Post on 15-Feb-2017
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GOAL CATEGORIES & THE RMM SOLUTION
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Category Description RMM solutionInvest Saving for a future goal • 2-IN-ONE Savings 4 my
Goal• Single Premium
Investment planRetire Saving to be able to maintain a lifestyle
after retirementRetirement Plan
Death & Disability Leaving sufficient funds behind to settle outstanding debt and take care of
dependants
• Pure Life Plan• Life & Disability Plan
• Accidental Death & Disability Plan
Paying for a dignified funeral • Funeral Care Plan• Standard Funeral Plan
• Comprehensive + Funeral Plan
Education Saving for a child's education to ensure a brighter future
2-IN-ONE Savings 4 Education
Debt Free Settling all debt or consolidating debt to ensure greater disposable income
Old Mutual Finance
Household & Car Ensuring your personal belongings against theft or damage
iWYZE
PRESENTATION TITLEPRESENTATION TITLE
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Why would your customers need to save for a future goal?
Case study
FINANCIAL GOAL: SAVING FOR A LONG-TERM GOAL
• Saving for a goal, means that you do not have to incur debt to reach a goal
• Saving over a long term results in better growth for your money because of compounding
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Who should buy the 2-IN-ONE Savings plans?
The 2-IN-ONE Savings plans are designed for customers who want to commit to a specific long term goal, but also want access to money during this period if required.
It is not aimed at customers wanting to save solely for the period shorter than 10 years.
2-IN-ONE SAVINGS PLANS
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2-IN-ONE Savings plans
Long Term Pocket Short Term Pocket
Build for the future Deal with todayRegulated by the Long
Term Insurance ActRegulated by the Collective
Investment Schemes Control Act
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What are the age limits?
2-IN-ONE SAVINGS PLANS
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ProductMinimum entry
age for policyholder
Maximum entry age for
policyholder
2-IN-ONE SAVINGS 4 MY GOAL 0 N/A
2-IN-ONE SAVINGS 4 MY GOAL (With Premium Waiver Option) 16 N/A
2-IN-ONE SAVINGS 4 EDUCATION 0 N/A
2-IN-ONE SAVINGS 4 EDUCATION (With Premium Waiver Option) 16 N/A
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2-IN-ONE SAVINGS PLANS
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ProductMinimum entry
age for the child
Maximum entry age for the
child
2-IN-ONE SAVINGS 4 EDUCATION Birth 14
2-IN-ONE SAVINGS 4 EDUCATION (With Premium Waiver Option) Birth 14
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2-IN-ONE SAVINGS PLANS
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What are the minimum and maximum terms?
Product Minimum TermsWhen maturity
benefit is available
2-IN-ONE SAVINGS 4 MY GOAL 10 Any age
2-IN-ONE SAVINGS 4 MY GOAL (With Premium Waiver Option) 10 Any age
2-IN-ONE SAVINGS 4 EDUCATION 10 Any age
2-IN-ONE SAVINGS 4 EDUCATION (With Premium Waiver Option) 10 Any age
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HOW CONTRIBUTIONS ARE COLLECTED
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Total Contributi
on
Long Term Pocket
Short Term Pocket
R150 R130 R20R160 R130 R30R900 R585 R315R2000 R1300 R700
For contribution from R150 – R200 a month:
R130 goes into long term and the rest goes into the short terms savings.
For contributions over R200 a month:
65% goes to long term and 35% to short term.
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PREMIUM SPLIT: WITHOUT PREMIUM WAIVER OPTION
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How is the premium split?
Total Contribution Long term premium Short term contribution
R150 R130 R20
R200 R130 R70
R250 R162.50 R87.50
R300 R195 R105
R400 R260 R140
R500 R325 R175
R1000 R650 R350
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PREMIUM SPLIT: WITH PREMIUM WAIVER OPTION
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How is the premium split?
Total contribution Long term premium
Premium for Premium Waiver
Short term contribution
R165 R130 R13 R22
R200 R130 R13 R57
R250 R152.58 R15.26 R82.16
R300 R183.10 R18.31 R98.59
R400 R244.13 R24.41 R131.45
R500 R305.17 R30.52 R164.32
R1000 R610.33 R61.03 R328.64
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FEES
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It is of crucial importance that you disclose these fees to your customers. This links closely to TCF legislation in that you have
to be transparent regarding anything that could impact a customer’s savings.
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PRODUCT FEATURESShort -term contribution increases and decreases
A customer can increase or decrease their short term contribution by at least R20 once every year. No changes are allowed for the first 12 months.
Savings top-up
A Top-up can be made anytime, provided that a previous top-up contribution has been finalised. The top up limits are as follows:
Minimum top-up amount – R250Maximum top-up amount – R5000
Top-ups can only be made via a once off debit order arranged at a client services branch. Any amount for the savings top-up will first be used to pay the long-term premiums that might be in arrears.
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PRESENTATION TITLEPRESENTATION TITLE
When: Savings Boosters is an amount equal to:
After 24 premiums Sum of the last 2 long term premiums
After 60 premiums Sum of the last 3 long term premiums
After 110 premiums Sum of the last 8 long term premiums
PRODUCT FEATURESSavings boosters
To motivate our customers to be disciplined in their long term savings. Old Mutual will pay into the long-term pocket, the following:
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ActivityAmount = R275.60
24R137.80
23R137.80
22R137.80
21R137.80
20R137.80 Premiums
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DISABILITY, DEATH & MATURITY
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Long-term pocket
Disability of policyholder
Death of policyholder
Maturity
2-IN-ONE Savings 4 my Goal(Without Premium Waiver Option)
The customer has 3 options:
1.Continue paying premiums2.Request that the policy be made paid-up if the minimum paid-up value is met.3.Claim the fund value with a valid disability claim
The fund value available at the time of death will pay out, if claimed by the nominated beneficiary.
The fund value is transferred to the short -term pocket.
2-IN-ONE Savings 4 Education(Without Premium Waiver Option)
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DISABILITY, DEATH & MATURITY
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Short-term pocket
Disability of policyholder
Death of policyholder
Maturity
2-IN-ONE Savings 4 my Goal(With and without Premium Waiver Option)
If the long-term pocket is made paid-up, the short-term pocket will also be paid-up.
The fund value available at the time of death will pay into the customer’s estate.
After the long -term pocket fund value is transferred to short term -pocket, the short-term Pocket remains paid-up
until the customer claims the maturity
proceeds
2-IN-ONE Savings 4 Education(With and without Premium Waiver Option)
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THE PREMIUM WAIVER OPTIONWhat is the premium waiver option?
It can only be selected on application of the policy.
It protects the customer’s savings only for the first 10 years, irrespective of the term selected by the customer.
It costs a customer an additional 10% of the long term premium, for10 years only, thereafter this additional amount is paid to the Long Term Pocket.
There is a 6 months waiting period on death or (certain) disability as a result of natural causes.
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THE PREMIUM WAIVER OPTIONHow does the premium waiver work?
The premium waiver comes into effect when the policyholder dies or becomes disabled. Old Mutual will inject a lump sum, equal to the remainder of the premiums required up to a term of 10 years. After the lump sum was injected, the following applies:
2-IN-ONE Savings 4 my Goal – The policy will pay out.
2-IN-ONE Savings 4 Education – The policy will become paid-up.
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PRESENTATION TITLEPRESENTATION TITLE
Activity
THE PREMIUM WAIVER OPTION1. A customer has a 2-IN-ONE Savings 4 my Goal and dies due to natural causes after 4 months from applying for the policy.
The fund value available at the time of death will pay out to the beneficiary.
2. A customer has a 2-IN-ONE Savings 4 my Goal and dies due to natural causes after 2 years from applying for the policy.
Old Mutual will inject a lump sum, equal to the remainder of the premiums required up to a term of 10 years and the policy will pay out.
3. A customer has a 2-IN-ONE Savings 4 Education and becomes disabled due to an accident after 1 month from applying for the policy.
Old Mutual will inject a lump sum, equal to the remainder of the premiums required up to a term of 10 years and the policy will become paid-up.
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THE PREMIUM WAIVER OPTION
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2-IN-ONE Savings 4 my Goal and Education(With Premium Waiver Option)
Death of PolicyholderNatural Causes Accident
Less than 6 months from application date
The fund value available at the time of death will pay out, if claimed by the nominated beneficiary.
Waiver benefit applies
More than 6 months from application date
Waiver benefit applies Waiver benefit applies
After 10 years
The fund value available at the time of death will pay out, if claimed by the nominated beneficiary.
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THE PREMIUM WAIVER OPTION
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Disability of PolicyholderNatural Causes Accident
Less than 6 months from application date
The customer has 3 options:
1.Continue paying premiums2.Request that the policy be made paid-up if the minimum paid-up value is met.3.Claim the fund value with a valid disability claim
Waiver benefit applies
More than 6 months from application date
Waiver benefit applies Waiver benefit applies
After 10 years
The customer has 3 options:
1.Continue paying premiums2.Request that the policy be made paid-up if the minimum paid-up value is met.3.Claim the fund value with a valid disability claim
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CAUSAL EVENTS
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Long-term pocket Short-term pocket1 part-withdrawal after every 5 years Money can be withdrawn at any time up to a
balance of R0.
Long-term pocket Short-term pocketSurrender value is available at any time Will automatically surrender when long-term
pocket is surrendered
Long-term pocket Short-term pocketWill automatically become paid-up when customer stops paying premiums and the premium holiday benefit and the grace period is used if the value is greater than R1000.
Customer can also request for it to be made paid-up if the minimum paid-up value is met.
Will also be paid-up if the long-term pocket is paid-up.
Part-withdrawals
Surrender
Paid-up
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FEES & CHARGES APPLICABLE FOR CAUSAL EVENTS
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Event Fees & Charges
Part withdrawal
R300* + reducing fee.
Sum must not be more than 30% of fund value
Paid-up
Surrender (from active status)
Surrender (from paid-up status)
R155*, which must not be more than 30% of fund value
Under certain extreme circumstances (for instance, investment market crash), we may reduce the Part Withdrawal and the Surrender Values by a percentage as a protective measure. Once the market normalises, the reduction percentage may be removed.
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THE REDUCING FEE: SAVINGS PLAN WITH A TERM OF 10 YEARS
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15%
0%
Application 5 years
Charge term
10 years/2 = 5 years
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THE REDUCING FEE: SAVINGS PLAN WITH A TERM OF 20 YEARS
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15%
0%
Application 10 years
Charge term
20 years/2 = 10 years
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THE REDUCING FEE: SAVINGS PLAN WITH A TERM OF 30 YEARS
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15%
0%
Application 10 years
Charge term
10 years/2 = 15 years
Maximum penalty term is 10 years.
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HOW SAVINGS ARE INVESTEDLong Term Pocket
1. Savings in the Long Term Pocket are all invested in the Old Mutual Smoothed Bonus Fund.
2. The fund then invests in a mix of investments, such as:
a) High growth investments: Sharesb) Medium growth investments: Propertyc) Low growth investments: Bondsd) Foreign investments: All of the above
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HOW SAVINGS ARE INVESTED3. This is a medium risk fund: Under bad market conditions, customers may get less than what was invested.
4. Customers’ savings grow by bonuses declared each year for the previous year.
5. Guaranteed to receive not less than sum of the accumulated net premiums at:
a) Maturityb) or death.
6. Guarantee falls away on taking part-withdrawals or surrender of policy.
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The yearly bonuses we declare are not guaranteed. This means that the bonus may be reversed in extreme market conditions.
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HOW SAVINGS ARE INVESTEDShort Term Pocket
1. Savings in the Short Term Pocket are all invested in the Old Mutual Money Market Fund.
2. The fund then invests in cash and other banking investments.
3. This is a low risk fund: Very small chance that customers would get less than what was invested.
4. Customers’ savings grow by interest, which is added at the end of each month. 5. For customers exiting, the interest earned up that day is added.
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2-IN-ONE SAVINGS 4 EDUCATION: EXCLUSIVE FEATURES What limits apply to children?
A customer can take out the 2-IN-ONE Savings 4 Education for any child, it does not have to be a dependent, own or legally adopted child.
A customer can change the name of the child on the plan for any reason and at any time.
The investment term for the child will be determined by the age of the child.
The normal age at which a child finishes with school is at 18. It would make sense for a customer to select a term that would reach maturity when the child reaches 18 or 19 years.
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2-IN-ONE SAVINGS 4 EDUCATION: EXCLUSIVE FEATURES What happens on death or disability of the child?
On death or disability of the child the customer has the following options:
Replace the child on the plan with another child and continue paying premiums.
Request the fund value to be paid out with a valid disability or death claim.
Request for the policy to be made paid-up if minimum paid-up value is met.
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2-IN-ONE SAVINGS PLANS
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2-IN-ONE Savings Plans assessment
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THE SINGLE PREMIUM INVESTMENT PLAN
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Single Premium Investment PlanMinimum entry age for policyholder None
Maximum entry age for Policyholder None
Minimum premium R2000
Maximum premium R200 000
Minimum term 5 years
Maximum term None
Who can be the premium payer? Anyone can pay
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THE SINGLE PREMIUM INVESTMENT PLAN
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Single Premium Investment PlanPremium Holiday
Surrender value available?
Part-withdrawals allowed?
Paid-up option available?
API applicable?
Family Support Services
Excluding Funeral Support
Yes No
Yes No
Yes No
Yes No
Yes No
Yes No
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THE SINGLE PREMIUM INVESTMENT PLAN
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Single Premium Investment Plan assessment
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SAVINGS RANGE: THE ADVICE LED CONVERSATION
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The value of Advice Led Conversation.
THANK YOU
Old Mutual is a licensed Financial Service Provider
THANK YOU
Old Mutual is a licensed Financial Service Provider