Meeting Overview

1
Welcome
2
Meeting Overview

• Who is Fidelity Guaranty Life
• Who is Old Mutual
• Insurance Industry Trends
• Why Fidelity Guaranty Life

3
FG Life

• Founded in 1959
• Premier provider of Life and Annuity products
• Offers diverse product portfolio in 49 States and
  DC
• One of the first members of IMSA

4
FG Life (cont.)

• Strong financial strength ratings
• A.M. Best A
• Standard Poors A
• Fitch A
• Moodys A2

5
FG Life (cont.)

• Proven track record in producing positive sales
  and earnings growth
• Between 1993 and 2000, sales increased 448 and
  have grown to more than 1 Billion a year
• Surpassed 2 Billion in new premium in June 2002

6
FG Life (cont.)

• Based on LIMRA results
• 4th largest brokerage term writer in annualized
  premium (1st Quarter 2002)
• 8th largest brokerage life writer in annualized
  premium (1st Quarter 2002)
• Top 5 fixed annuity writer (2002)

7
Old Mutual

• In September 2001, joined forces with Old Mutual
  family of companies
• Founded 156 years ago
• London based insurance asset management company
• Fortune Global 500 Company
• Manages 234 Billion in funds (June 2001)

8
Old Mutual (cont.)

• Has 3.8 Million policyholders
• Has 2.4 Million banking customers
• Dedicated to the U.S. life insurance market

9
What has Old Mutual brought to FG Life?

• Capital to grow our business
• By the end of 2002, Old Mutual will have invested
  over 1 Billion in FG Life
• 816 Million through March 2002 which includes
  the initial purchase of 635 Million in September
  2001
• An additional 200 Million by December 2002
• FG Life has Old Mutuals support to continue to
  grow and support the new business we provide in
  todays economic environment and the future

10
What has Old Mutual brought to FG Life?

• World class expertise in Administrative Services
• Old Mutual provides the purchasing and
  negotiating power - and the weight - to
  competently move from a single supplier of
  administrative services to an actively managed
  portfolio of suppliers
• FG Life gains additional competency from
  suppliers with specialized skills
• Skills are now available to make changes without
  jeopardizing existing business and relationships
• A Win-Win situation is realized through lowering
  operating expenses and gaining quality of
  services provided

11
What has FG Life brought to Old Mutual?

• FG Life has proven to be an excellent entry into
  the U.S. life insurance market by providing
• An established distribution channel and partners
• An experienced management team
• Knowledge in innovative product design
• An established and well run organization
• Outstanding sales growth
• A great platform for future growth
• A Great Success Story!!!

12
What wont Old Mutual bring to FG Life?

• Failure to support our distribution channels and
  partners
• Rejection of the ideas and needs of agents
• Neglect to our distribution partners in terms of
  service and product design
• Second class solutions to problems and
  opportunities

13
Insurance Industry Trends

• New Insurance Sales
• Overall trends downward in life insurance sales
• Despite industry trends, traditional life
  products are showing excellent growth
• Key issues impacting new sales
• performance of equity market
• events of September 11th
• new institutional sales
• estate tax reform uncertainty

14
U.S. Business Environment

• Interest rates at historic low levels and holding
• Volatility of stock market
• declines started in March 2000
• overall worst market performance in 23 years
• Investor confidence rattled
• ENRON
• WorldCom

15
U.S. Business Environment (cont.)

• Favorable demographic trends
• The aging of America
• in 1970, 9 of Americans were over 65
• in 2002, the figure is 12.5
• in 2030, it will be 19
• The youngest of Baby-Boomers are now eyeing 40
• We are in the midst of the greatest transfer of
  wealth in history

16
U.S. Business Environment (cont.)

• We are in the most positive sales environment we
  have ever seen
• Our products have what consumers want and need
  today

17
U.S. Business Environment (cont.)

• Our products have
• Safety
• Tax Advantages
• Competitive Yields/Rates
• Liquidity
• Estate Planning Advantages
• Protection for Families

18
Why Fidelity Guaranty Life

• We have 5 core values that form the foundation to
  provide the best life and annuity products in the
  marketplace
• Integrity - customer satisfaction is our 1
  priority and is the cornerstone for all of our
  business activities
• Professionalism - we strive to exceed the
  expectations of our policyholders and
  distribution
• Innovation - by listening to and understanding
  what the market needs, we constantly look for
  unmet needs and continue to develop innovative
  products to meet those needs

19
Why Fidelity Guaranty Life (cont.)

• Service - we recognize that service is the name
  of the game and are striving to ensure that are
  distribution is given the level of service they
  need and deserve
• Teamwork - we place a strong emphasis on teamwork
  and customer feedback by encouraging open
  communication from our key stakeholders which
  enables us to achieve higher levels of
  innovation, success and dedication

20
Why Fidelity Guaranty Life (cont.)

• With Fidelity Guaranty Life, you have a solid
  partner for your financial future
• With Fidelity Guaranty Life, you have a company
  built upon the promise that
• Life Keeps Getting Better!!!

21
Fidelity Guaranty Life Portfolio

• HomeCertain - level term insurance targeted for
  those who have secured a mortgage loan in the
  last 13 months
• Savers Select Term - level term insurance with
  15, 20 and 30 year term periods

22
Fidelity Guaranty Life Portfolio

• SecureMaster - simplified issue universal life
  product that can be purchased without a medical
  exam
• WealthMaster Classic - our newest flagship
  universal Life product that offers choice,
  flexibility and guarantees

23
Why WealthMaster Classic

• There is a market for a competitive universal
  life product
• Volatility in the stock market creates shift to
  fixed products
• Fixed UL had the highest growth in market share
  in 2001
• Flexibility in design still a popular choice
• New generation of ULs have long-term guarantee
  features
• Still a large number of under-performing policies

24
WealthMaster Classic

• Outstanding Product Features
• No Lapse Premium Guarantee to Age 100
• Two Years of First Year Commission
• Extended Maturity Option
• Surrender Charge Waiver
• Competitive Current Interest Rates
• Liberal Underwriting Requirements

25
WealthMaster Classic Leading Edge Policy Design

• Issue ages 0 - 85 (age last birthday)
• Minimum Face Amount 100,000
• Maximum Face Amount None
• Four Premium Classes Preferred NonTobacco,
  NonTobacco Preferred Tobacco and Tobacco

26
WealthMaster ClassicLeading Edge Policy Design

• Three cost of insurance bands
• 100,000 - 499,999
• 500,000 - 999,999
• 1,000,000 - over
• Short form application
• Same liberal preferred underwriting as Savers
  Select

27
WealthMaster Classic Leading Edge Policy Design

• Guaranteed interest rate 3.5
• Current credited interest rate 6.5
• Stable interest rate history on universal life
• Guaranteed interest rate bonuses
• .5 years 11-20
• 1 years 21
• Surrender charge period 15 Years

28
WealthMaster ClassicLeading Edge Policy Design

• Withdrawals and partial surrenders permitted
  after first policy year (500 minimum with a 25
  charge for each partial surrender)
• No Cost policy loans available after 10th
  policy year

29
WealthMaster Classic Leading Edge Policy Design

• Target premium GUARANTEES the death benefit to
  age 100 at all issue ages
• Targets Male Female
• Age 35 5.90 4.73
• Age 45 10.11 8.08
• Age 55 15.66 12.89

30
WealthMaster Classic Leading Edge Policy Design

• Minimum premium guarantees the death benefit for
  15 years
• Sample Minimum Premiums
• Male Female
• Age 35 2.95 2.40
• Age 45 5.06 4.08
• Age 55 9.60 7.68

31
WealthMaster Classic Leading Edge Policy Design
Two years to collect first year target and get
paid first year commission!
32
WealthMaster Classic Leading Edge Policy Design
Example Male age 35 Preferred N/S 150,000
face amount Target premium is 885 Client pays
442.50 per year for 15 years of guaranteed death
benefit and 30 years of coverage on a current
interest basis. Agent receives commission as
follows First year rate X 442.50 year
one First year rate X 442.50 year two
Total commission is two times the first
year premium
33
WealthMaster Classic Leading Edge Policy Design

• All premium in excess of target in the first year
  flows directly to the guaranteed cash surrender
  value less a 5 premium load.
• Example
• Target premium is 3,000 with a 1035 cash value
  of 15,000. The guaranteed surrender value the
  first year is 14,250.00

34
WealthMaster Classic Leading Edge Policy Design

• Extended Maturity Provision
• 1 or more of cash value at age 100 maintains the
  death benefit beyond age 100.
• Example
• Face amount is 1,000,000 at issue and has not
  been reduced for the life of the contract. There
  is 100,000 of cash at time of maturity. The
  1,000,000 of face will remain in-force at the
  time it is needed most.

35
WealthMaster ClassicSimple Underwriting

• Short simple application for quicker turnaround
  time
• No Blood through age 40 500K, age 50 250K
• Easier for your client
• Four underwriting bands Tobacco, Nontobacco,
  Preferred Tobacco and Preferred Nontobacco
• No need to resell case at delivery with higher
  rate
• Your Client Male 45, 60 248, BP 150/90
  Cholesterol 260, HDL 7.0 , one parent die before
  age 60 due to heart or cancer
• gets our best rate!

36
WealthMaster ClassicSimple Underwriting

• Liberal Height Weight
• Liberal blood pressure readings
• 150/90 age 50 and younger
• 160/95 ages 51 (blood pressure
  treatment allowed if controlled over
  last 2 years)
• Cholesterol
• 260 age 50 and younger
• 280 ages 51 to 65
• 300 over age 65, Cholesterol/HDL ratio cannot
  exceed 7.0 (Cholesterol treatment allowed if
  controlled over last 2 years)

37
WealthMaster Classic Leading Edge Policy Design

• Additional Riders
• Accelerated Death Benefit Rider
• Accidental Death Benefit Rider
• Childs Level Term Insurance Rider
• Disability Income Rider
• Level Term Insurance Rider
• Waiver Of Monthly Deduction Rider

38
Accelerated Benefit Rider

• If client is diagnosed with a terminal illness,
  they can receive up to 50 of the policy death
  benefit, up to a maximum of 250,000
• Must be elected at policy issue.
• No Premium charge.
• One time administrative fee of 350 at time of
  claim.

39
Accidental Death Benefit Rider

• Issue ages 0-60 (age last birthday)
• May be added at any time with evidence of
  insurability
• Maximum benefit is the face amount of the policy
  up to 250,000

40
Childrens Level Term Life Rider

• One premium is charged for all covered children
• Issue ages 15 days through 18 years of age age
  last birthday
• Minimum/ maximum 5,000/ 10,000 available in
  increments of 1,000
• If primary insured dies while this rider is in
  effect each child will receive a paid- up term
  life policy to age 25.
• Convertible to age 25.

41
Disability Income Rider

• Maximum monthly benefit is the lesser of
• 3,000 monthly or
• 66 2/3 of monthly pay
• Total disability is defined as inability to
  substantially perform in the usual and customary
  way the essential duties of any occupation for
  which the insured may qualify by reason of
  education, training or experience
• Must be added at issue only
• Three month waiting period and 2 year benefit or
  Six month waiting period and 5 year benefit

42
Level Term Insurance Rider

• Provides one-years level term insurance
  renewable through insureds age 99 or the
  expiration of coverage, whichever is first
• Ideal for business - allows policyowner to add or
  drop insureds as needed
• Face amounts may vary by individual but cannot
  exceed the primary insureds face amount

43
Waiver of Monthly Deduction

• Waives the monthly deductions (cost of insurance
  and expense charges)
• Keeps coverage in force in the event of total
  disability lasting longer than 6 months.
• Prevents cancellation of coverage and keeps the
  cash value from being exhausted.

44
WealthMaster Classic

• Sample Illustrations Male 50 - 500,000 - PNT
• Target Premium
• Minimum Premium
• Minimum Premium to Carry
• Minimum Premium to Endow
• Minimum Premium for 15 Years/Dump-In/Target
• 25 Pay Equal to Target
• 1035 Exchange Plus Target
• 1035 Exchange Plus Premium Equal to Target

45
Questions and Answers
46
Summary and Recap

• The business environment is the best we have seen
• Industry sales of fixed life insurance products
  continue to be excellent
• The outlook for the remainder of 2002 and the
  first half of 2003 is bright
• Fidelity Guaranty Lifes products are extremely
  competitive and well positioned
• We will continue to be a major competitive
  product provider for you - investing in future
  growth and product innovation