National Association of State Treasurers

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• National Association of State Treasurers
• May 2002

Carey Hoch VP Product Marketing Manulife
College Savings
MLI0510021263
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Manulife College Savings
Manulife Financial
Education Trust of Alaska
T.Rowe Price
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Manulife USAs Strengths

• Over US 92 billion in assets globally
• Distribute four different product lines
• Group Pensions - 1 in the sale of 401(k) plans
  and one of the top sellers of new Defined
  Contribution plans within its peer group for
  second year in a row
• Life Insurance 1 in average policy size
  across all product lines
• Annuities top ten annuity provider in the
  non-proprietary broker/dealer channel, according
  to VARDS 2001 year end data
• College Savings Over 212 million in sales in
  only in the market9 months
• Over 180 local wholesalers

According to the 2001 LIMRA U.S. Institutional
Pensions Sales Survey Source LIMRA
International, U.S. Individual Life Insurance
Sales Survey, Q3 2001
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Purpose of Study

• Identify delivery support service preferred by
  producers
• Conduct an attitudinal survey of brokers to
  identify
• Future role of education products in producers
  business
• Identify education products that producers are
  currently using
• Define key drivers of product selection
• Define the 529 customer profile to help build
  business

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Familiarity with 529 Plans

• Almost all of those producers surveyed were
  familiar with 529 College Savings Plans (94)

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College Savings Products Sold Most Often
Traditional taxable mutual funds that clients
specifically intend to use as college savings
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Events Influencing 529 Plan Purchase

• Producers report that clients typically purchase
  529 plans for child beneficiaries who are between
  the ages of 5 and 9
• Producers see a pretty even split between parents
  (51) and grandparents (39) as prospects for 529
  sales
• Three out of four (76) also suggest that the
  birth of a child or grandchild is often a trigger
  event that influences the decision to purchase a
  529 plan

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Events Triggering 529 Plan Purchase
89
72
66
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Average Time to Complete the Sale of 529 Plan
80 of producers complete the sale within one
month
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Hurdles for Producers Selling 529 Plans
Clients have a difficult time finding the money
to properly fund these products
65
The products are difficult to sell because all of
the features benefits have to be explained to
potential clients
43
Regulatory uncertainty makes people hesitant to
buy these products
41
It is difficult to convince clients of the need
for these products
27
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Producer Investment Selection Criteria

• Producers are most likely to say they consider
  the variety of investment options and the service
  their client will receive from the company to be
  very important considerations in their choice
  (72 each)

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Top Tools Used to Introduce 529 Plans

• Mailers 42
• Seminars 32
• Kits 19
• Online Calculators 16
• Meeting with client 14
• Referrals/word of mouth 8

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Manulife College Savings Marketing Strategy

• Help define target markets for producers
• Parents
• Grandparents
• Build marketing materials geared for both targets
  to help brokers prospect their book

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Manulife College Savings Marketing Strategy

• Advisory sold market positions products as part
  of an overall financial plan
• Develop tools to help present to clients as part
  of plan
• Calculators
• State Tax Benefit
• UGMA/UTMA
• College Cost
• Family

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State Tax Benefit Calculator
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State Tax Benefit Calculator
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Thank you National Association of State
Treasurers May 2002