now is the time for critical illness insurance sm

For Agent/Broker Dealer Information Only. Do Not Use with Consumers.

Now is the TimeNow is the TimeFor CriticalFor Critical

Illness InsuranceIllness Insurancesmsm

Presented by

Dana Davis and Mary Grahovac

June 29, 2006

PLAG.2789.02.06


““Not because you are going to die, but Not because you are going to die, but because you are going to survive!”because you are going to survive!”

Dr. Marius BarnardDr. Marius Barnard


Health chassis product Issue amounts of 25,000 – 500,000 Issue ages 18-65 14 covered illnesses

Protective CRITICALanswersm

Policy Form CI-03

Policy form CI-03 is a limited benefit health coverage policy providing limited or supplemental coverage, paying benefits ONLY upon first occurrence and diagnosis of a covered condition. Advanced payments reduce base policy's benefit; any lump sum payments may be taxable. Consult your tax advisor for tax details. If 100% of maximum allowable benefit is advanced, policy will terminate. Consult policy for benefits, riders, limitations, exclusions, reductions, and terms under which policy may be continued in force or discontinued. Policy form and definitions may vary by state. Subject to underwriting. Not available in all states.


CRITICALanswerSM Covered Critical Illnesses

* May vary by state

** See “No Waiting Period on Most Covered Conditions” for further information Policy Form CI-03


Multiple Payment Benefit allows payment from three categories, not to exceed three times initial face amount, based on policy specification


Policy Form CI-03


CRITICALanswerSM Multiple Payment Benefit Feature

Exceptions and Limitations: 1. The Payment of all benefits under the policy shall not exceed three times the initial benefit amount stated in the policy; 2. The payment of benefits ender each category shall not exceed 100% of the initial benefit amount for each category; 3. There shall be only benefit payment for each covered condition; 4. There shall be only one benefit payment per 180-day period across the three categories. However, the 180-day period does not apply to benefit payments within the same category; 5. If a first-ever diagnosis occurs within the 180-day period after a benefit payment, it is not effectively considered a “first-ever diagnosis” under the policy. Therefore, a benefit payment may be paid for a subsequent occurrence and diagnosis of that covered condition; and 6. If more than one covered condition is diagnosed at the same time, the benefit payment shall be based on the larger benefit amount of those diagnosed. If there benefits amounts are the same, there shall be only one benefit payment per 180-day period. See Outline of Coverage for “How this Benefit is Calculated”.

Policy Form CI-03


Return of Premium upon death, less any benefits paid, as long as policy remains in force

No waiting period on most covered conditions Reduced Benefit Period – If the insured is

diagnosed with a covered condition of Invasive or In Situ Cancer, the reduced benefit period shall be 90 days, beginning on the policy effective date

Renewable for life - benefit reduced 50% in each category at age 65 or five years, whichever is greater.


Policy Form CI-03


Protective CRITICALanswerSM


Underwriting Critical Illness Insurance

Remember … incidence occurs before mortality If the applicant has a history of any of the covered

conditions they will not qualify for the insurance Morbidity based underwriting versus mortality based

underwriting For example, in assessing coronary risk, there is a higher

occurrence for the event of either a heart attack or coronary bypass surgery than the probability of dying from either one of these.

Source: OptimumRe



Family history typically has a greater impact on CI underwriting than life underwriting. Variables associated with family (natural parents and siblings) history include:

The number of affected first degree relatives (FDR) The FDR’s age at diagnosis – not death The current age of the applicant The sex of the applicant (in some cases)

Source: OptimumRe


Potential Impact of Family History on CII

0

10

20

30

40

50

60

70

18 22 26 30 34 38 42 46 50 54 58 62

Age of Applicant

Age

of

Dia

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DR

Line 1

Less Impact

Greater Impact



Build is an important factor in critical illness underwriting

Generally, an APS will be ordered more frequently on CI applications

Typically the best candidates for standard CI underwriting would be the those individuals eligible to qualify for Select Preferred or Preferred life underwriting

Source: OptimumRe


Protective LifeInsurance Company

now is the time for critical illness insurance sm

Documents

benefit payments

initial benefit

life benefit

larger benefit

information policy form

maximum allowable benefit

policy effective daterenewable

day period