Exploring LTC Solutions - Ash Brokerage

1©2021 Lincoln National Corporation

LCN-3447717-021021For broker-dealer use only. Not for use with the general public.

L I N C O L N M O N E YG UA R D M A R K E T A D VA N TA G E ℠

Exploring LTC Solutions:

A P R I L 2 7 , 2 0 2 1



David J. Bidwell CTLC and Rob Johnson Sales VP / Lincoln MoneyGuard Brokerage

Lincoln MoneyGuard Market Advantage®

Ash BrokerageApril 27, 2021



Agenda

• Lincoln as a Trailblazer

• MoneyGuard Market Advantage

• Investment Options

• Marketing Resources



State AvailabilityAs of April 2021

47 states:Approved

Pending: CA, MT

Not to be filed in NY



Lincoln as a Trailblazer



Power of Innovation and DistributionLincoln MoneyGuard® Solutions

1988 2004 2007 2010 2013 2014 2015 2019 2021

Launched Lincoln MoneyGuard

Lincoln MoneyGuard Reserve• First fully guaranteed

solution

Expanded sales force to 10 wholesalers• Increased sales by

over 25%

Sales force grew to 39 wholesalers• Over 60% sales growth

Launched flex-pay design• 62% hybrid market share

Created Lincoln Concierge Care Coordination for all policy holders.

Launched Lincoln MoneyGuard IIILaunched Basic ROP

Introducing MoneyGuard Market AdvantageSM



What the market is telling us

Methodology:Survey (3/26/2020 – 3/30/2020) with 333 financial professionals. [Note: Financial professionals were screened for selling Long-Term Care products]; Survey (3/3 /2020 – 3/6/2020) with 250+ consumers [Note: US Adults age 30-65, Financial decision-makers, Investable assets of $200k or more, Experience with long-term care coverage (i.e., the respondent or someone close to them needed LTC services), Some level of interest in purchasing long-term care coverage in the next 5 years.

Full Guarantee – Known benefits, no upside potentialModerate Guarantee – Limited Reduction in Guarantee for Moderate UpsideLess Guarantee – Significant Reduction in Guarantee and Significant UpsideNo Guarantee – Unlimited Downside for Maximum Upside

• The majority of financial professionals (58%) and consumers (56%) place much more importance on guarantees within an LTC product than investment growth potential.

• However, over half of financial professionals (56%) and consumers (51%) said they would recommend or choose a product that offers a limited reduction in guarantees for moderate upside potential.

27%

56%

11%6%

FINANCIAL PROFESSIONAL

Full Moderate Less None

34%

51%

14% 1%

CONSUMER

Full Moderate Less None



• Believe they can outperform guaranteed solutions

• Primary focus is tax-deferred growth and income

• Primary focus is legacy protection through death benefit

• Primary focus is a comprehensive long-term care strategy

• Receive death benefits whether or not LTC benefit is needed

• Want some LTC protection but looking for lower cost options

LTC Strategy

Client Focus

Opportunity

Strategies for protecting against LTC expenses

• Expand our product suite with a solution that provides greater potential LTC benefits, vs current MoneyGuard products, through investment performance with a base level of guaranteed protection

• Provide substantially more legacy protection than 100% guaranteed solutions• Broaden target audience to capture those who may have otherwise selected other

LTC strategies

MoneyGuard Market AdvantageSM

Self-FundingAnnuities with

LTC ridersLife with LTC riders

MoneyGuardHybrid Solutions Traditional LTC

Only 7.5 million Americans have some long-term insurance in place1 even though an estimated 115 million Americans will need some type of care in their lifetime.2

1American Association for Long-Term Care Insurance, 2020, www.aaltci.org.2World Bank Group, https://data.worldbank.org/indicator/SP.DYN.TO65.MA.ZS. (Longevity); 2017 Profile of Older Americans, Acl.gov (Care need percentage); U.S and World Population Clock, https://www.census.gov/popclock/ (Population).

http://www.aaltci.org/

https://data.worldbank.org/indicator/SP.DYN.TO65.MA.ZS

https://www.census.gov/popclock/



MoneyGuard Market Advantage



Introducing MoneyGuard Market AdvantageSM

Long-term care benefit growth potential Upside potential to grow long-term care benefits by participating in the market with a guaranteed 3 year minimum LTC benefit duration1.

Protected benefitsAnnually lock-in a portion of your client’s LTC benefit pool every anniversary.

Legacy protectionIf your client doesn’t need care, potential for death benefit growth to leave a meaningful legacy.

Investment optionsEasy-to-manage fund lineup allows for customization for all risk tolerances*.

MoneyGuard Market AdvantageSM provides long-term care and death benefit growth potential through

investment performance, as well as added LTC protection through annual lock-ins and a guaranteed benefit base1.

1 Assuming all premiums are paid, no post-issue loans, withdrawals, increases or decreases are made.* Three tiers of funding options are available: Tier 1 – Fixed Account, Bond funds, Tier 2 – Blended (Equity/Bond) Funds, Asset Allocation Funds, Target Date Funds and Tier 3 – Equity Funds. Up to 80% of allocation can be in Tier 3 options (Equity funds). If any money is allocated to Tier 3 then at least 20% of the money needs to be allocated to Tier 1 options (Fixed Account, Bond funds). A periodic auto-rebalancing will be built into the product to ensure this.

MoneyGuard Market AdvantageSM is a variable universal life insurance policy with a long-term care rider for qualified expenses.



Flex Care Cash Benefits

Look toward the future and help your clients stay in control with a plan that provides the convenience and flexibility for today and tomorrow.

Available as long as Base LTC value remains and informal care is approved as part of the Plan of Care.



How it works – LTC benefit growthLong-term care benefits with guarantees, growth potential through investment performance and lock-ins

• MoneyGuard Market AdvantageSM is a variable universal life insurance policy with a long-term care rider for qualified expenses.

• Growth potential and a way to protect against declining values.

• The highest LTC value of the following three choices will be used at time of claim:

– LTC Market Value that is 4x Accumulation Value.

– Annual lock-ins protect 2.5x Accumulation Value (Protected Value) to protect growth and protect against market volatility.

– 3-year initial minimum guaranteed long-term care benefit (LTC Base Value) provides a known level of protection at time of purchase.

FOR ILLUSTRATIVE PURPOSE ONLY. CONCEPTUAL REPRESENTATION.

Protected Value (Lock-in)

AccumulationValue

$-

$200,000.00

$400,000.00

$600,000.00

$800,000.00

$1,000,000.00

$1,200,000.00

$1,400,000.00

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41

Guaranteed Base Value LTC Market Value Protected Value Accumulation Value

MoneyGuard Market AdvantageSM LTC benefit comparison

Annual lock-in of 2.5x Accumulation ValueAccumulation Value x2.5 surpasses Guaranteed Benefit Base

LTC Market Value



How it works – Death benefit growth• MoneyGuard Market AdvantageSM provides enhanced legacy protection tied to performance of investment options selected

▪ Designed to provide greater death benefit potential than MoneyGuard III by leveraging subaccount returns into an enhanced death benefit.

‒ Death benefit increases as accumulation value grows.

‒ Potential for significantly greater legacy protection compared to current MoneyGuard offerings.

LesserDeath Benefit

▪ Death Benefit is primary focus

▪ Designed to provide the greatest guaranteed legacy protection with growth potential tied to investment performance.

▪ Guaranteed Death Benefit if LTC is not needed

▪ Death Benefit is greatest of the Specified Amount, Minimum Required Death Benefit or Residual Death Benefit.

GreaterDeath Benefit

MoneyGuard IIIMoneyGuardMarket AdvantageSM

VULONE

with LTC Rider



Illustrating MoneyGuard Market AdvantageSM



Illustration: Product Overview



Illustration: Summary of Benefits



Illustration: Illustrated values



Investment Options



Investment Flexibility

1 Allocation rules apply and are based on the risk profile of the funds selected. Please see policy for full details. 2 Dollar cost averaging is an optional program that enables you to systematically reallocate specified dollar amounts from the Fixed or Money Market Accounts to the variable accounts. By allocating funds on a regular basis as opposed to a one-time allocation, you may reduce the average cost per unit over time. Neither dollar cost averaging (DCA) nor portfolio rebalancing assures a profit or protects against loss in declining markets. Because dollar cost averaging involves continuous investment in securities regardless of fluctuating price levels, you need to consider if you’ll be in a position to continue purchasing through periods of low price levels. 3 Quarterly automatic rebalancing and allocation rules are required to maintain the Value Protection Rider (VPR) on MoneyGuard Market AdvantageSM.

Whether your clients want to build their own policy portfolio or they’d like to have more guidance, Lincoln has solutions to help.1

If your clients are the type of investors who:

Want to select a preset portfolio allocation. They can choose from our menu of professionally managed asset allocation options if they’d like a simple alternative to selecting individual funds and monitoring their performance.

Like the convenience of having one fund that evolves over time based on their investment horizon. They can choose from professionally designed, all-in-one target-date investment options that fit their risk tolerance and time horizon.

Prefer to build their own portfolio. They can choose from diverse investment options ranging from large cap growth to emerging markets and more.

To stay on track

Clients can take advantage of dollar cost averaging2 and automatic rebalancing3 to ensure that their strategy remains aligned with their risk tolerance and investment objectives.



Investment Overview

Investment Guide<Actual link to guide>



Investment Partners



Marketing Resources



Featured Marketing Pieces

Investment GuideAdvisor Guide

Client GuideConcierge Care Client Guide



Thank YouPlease contact the

Ash Brokerage LTC Team with anyQuestions or Illustrations Requests



(800) 589-3000www.ashbrokerage.com

Remember, It’s about a Plan!

Questions?



(800) 589-3000www.ashbrokerage.com

Thank you for attending

L I N C O L N M O N E YG UA R D M A R K E T A D VA N TA G E ℠

Exploring LTC Solutions:

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Exploring LTC Solutions - Ash Brokerage