VARIABLE ANNUITIES INVESTMENT GUIDE · VARIABLE ANNUITIES INVESTMENT GUIDE As of 5/1/20 INVESTMENT...

VAC0915-0121

VARIABLE ANNUITIES INVESTMENT GUIDEAs of 1/19/21

INVESTMENT AND INSURANCE PRODUCTS ARE:• NOT FDIC INSURED • NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY • NOT A DEPOSIT OR OTHER OBLIGATION OF, OR GUARANTEED BY, THE BANK

OR ANY OF ITS AFFILIATES • SUBJECT TO INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF THE PRINCIPAL AMOUNT INVESTED

A variable annuity is a long-term contract between you and an insurance company that helps

you grow, protect, and manage retirement savings in a tax-advantaged way. It can help you:

o Grow retirement savings faster through the power of tax deferral.

o Manage your investment strategy by transferring among a diverse selection of investment options free of tax consequences.

o Convert your assets to guaranteed, lifetime retirement income.

o Leave a financial legacy through a guaranteed death benefit.

Our variable annuities also offer features such as asset allocation and optional principal protection. Optional benefits are available for an additional cost.

CONSIDER A PACIFIC LIFE VARIABLE ANNUITY

Insurance products are issued by Pacific Life Insurance Company in all states except New York and in New York by Pacific Life & Annuity Company. Product availability and features may vary by state.

All guarantees are subject to Pacific Life’s financial strength and claims-paying ability and do not

protect the value of the variable investment options, which are subject to market risk. The

value of the variable investment options will fluctuate so that shares, when redeemed, may be

worth more or less than the original cost. Annuity withdrawals and other distributions of

taxable amounts, including death benefit payouts, will be subject to ordinary income tax. For

nonqualified contracts, an additional 3.8% federal tax may apply on net investment income. If

withdrawals and other distributions are taken prior to age 59½, an additional 10% federal tax

may apply. A withdrawal charge also may apply. Withdrawals will reduce the contract value and

the value of the death benefits, and also may reduce the value of any optional benefits.

Pacific Life’s variable annuity investment options offer:

o A large selection of investment options to choose from.

o Globally recognized and respected investment managers.

o A wide assortment of asset-class selections.

o Numerous investment options with net fund expenses of less than 1%.1

1

1 Net fund expenses are as of the most recent fund prospectus (adjusted for any fee waivers/reimbursements). For more information, including the gross expense ratio, waivers, and/or expense reimbursements, see the applicable fund prospectus. Expenses are subject to change, and there is no guarantee that the investment advisor will continue to waive and/or reimburse fund fees beyond their current terms as outlined in each fund prospectus. In addition, please refer to the variable annuity product prospectus for additional product fees and charges.

Asset allocation and diversification do not guarantee future results, ensure a profit, or protect against loss.

Invest for the Long Term

When investing for the long term, there is a way to help manage the market’s unpredictable behavior. It’s called

diversification—and it’s considered to be an important factor in affecting long-term investment returns.

Diversification is based on the fact that different types of assets generally react differently to changes in the markets.

By strategically diversifying your investment options among a variety of asset classes, you can help smooth out

the impact of market volatility on your portfolio’s total return and help reduce the risks of long-term investing.

At Pacific Life, we not only believe in diversification, we’ve created a way to help make it easier to achieve.

Your financial professional has tools to help you assess your financial needs, investment time horizon, and risk tolerance.

Use your financial professional’s help to determine which option—or combination of options—may be right for you.

2

When your portfolio is invested across major asset classes and investment styles, it can help weather the market’s

ups and downs, while reducing your exposure to risk. This is demonstrated by the total returns of the diversified

portfolio—indicated in dark blue—in the chart below.

DIVERSIFY TO MANAGE MARKET VOLATILITY

Returns assume dividends and capital gains are reinvested. Indexes are unmanaged and cannot be invested in directly. Further, they hold no cash and incur no expenses. The performance data herein represents past performance, which does not guarantee future returns. The Large-Cap Growth category is represented by the Russell 1000® Growth Index. The Large-Cap Value category is represented by the Russell 1000® Value Index. The Large-Cap Blend category is represented by the Russell 1000® Index. These three indexes measure the performance of the growth and value styles of investing in large-cap U.S. stocks and are constructed to provide a comprehensive and unbiased barometer of the large-cap market. The Mid-Cap Blend category is represented by the Russell 2500™ Index, which measures the performance of both growth and value styles of investing in mid-cap U.S. stocks and is constructed to provide a comprehensive and unbiased barometer for the small- to mid-cap segment. The Foreign Stock category is represented by the MSCI EAFE Index (Morgan Stanley Capital International), which measures the performance of developed stock markets in Europe, Australasia, and the Far East. The Fixed Income category is represented by the Bloomberg Barclays U.S. Aggregate Bond Index, which includes U.S. government, corporate, and mortgage-backed securities, and maturities up to 30 years. The Cash category is represented by the BofA Merrill Lynch U.S. 3-Month Treasury Bill Index (T bill). The Diversified Portfolio is represented by an equal portion of the previously listed indexes. Index performance is not illustrative of the performance of the diversified funds available through a Pacific Life variable annuity. For performance on Pacific Life investment options, visit PacificLife.com.

Source: Morningstar®, Inc., 2020.

Tota

l Ret

urns

Hig

her

Low

er

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Fixed Income11.63

Fixed Income

8.44

Fixed Income 10.26

Mid-Cap Blend 45.51

Foreign Stock 20.25

Foreign Stock 13.54

Foreign Stock 26.34

Large-Cap Growth

11.81

Fixed Income

5.24

Large-Cap Growth

37.21

Mid-Cap Blend 26.71

Fixed Income

7.84

Mid-Cap Blend 17.88

Mid-Cap Blend 36.80

Large-Cap Value 13.45

Large-Cap Growth

5.67

Mid-Cap Blend 17.59

Large-Cap Growth 30.21

Cash 1.87



Cash 4.42

Cash 1.78

Foreign Stock 38.59

Mid-Cap Blend 18.29

Mid-Cap Blend 8.11


Foreign Stock 11.17

Cash 2.06

Mid-Cap Blend 34.39

Large-Cap Growth

16.71

Large-Cap Growth

2.64


Large-Cap Growth33.48

Large-Cap Blend 13.24



Foreign Stock 25.03

Fixed Income

0.01


Cash6.18

Mid-Cap Blend 1.22

Diversified Portfolio –12.69




Mid-Cap Blend 16.17

Fixed Income

6.97


Foreign Stock 31.78


Large-Cap Blend1.50

Foreign Stock 17.32



Fixed Income

0.55



Large-Cap Growth

–1.51

Mid-Cap Blend 27.77

Mid-Cap Blend 4.27

Large-Cap Value –5.59




Diversified Portfolio

6.63



6.07

Mid-Cap Blend –36.79



Large-Cap Value0.39



Mid-Cap Blend 7.07


0.13


8.32

Mid-Cap Blend 16.81

Large-Cap Blend –4.78



–2.14


–6.53

Foreign Stock –15.94



11.13



13.93


Large-Cap Value

–36.85


22.54


13.08

Cash0.10


Foreign Stock22.78


6.79

Cash 0.05

Large-Cap Growth

7.08


15.63


–5.04


22.16





24.90

Large-Cap Growth

6.30

Large-Cap Growth

5.26

Large-Cap Growth

9.07

Cash 5.03



Foreign Stock 7.75


–0.10


12.70


21.59

Fixed Income

5.97


Fixed Income

2.65



Foreign Stock 22.01


Large-Cap Growth –20.42


Fixed Income

4.10

Fixed Income

4.34

Cash 3.06

Cash 4.83

Mid-Cap Blend 1.38


Fixed Income

5.93

Fixed Income

6.54

Mid-Cap Blend–2.51

Fixed Income

4.21

Cash 0.07

Cash 0.03


Foreign Stock 1.00

Fixed Income

3.54


Fixed Income

8.72




Cash 1.15

Cash 1.33

Fixed Income

2.43

Fixed Income

4.33



Cash 0.21

Cash 0.13

Foreign Stock–12.14

Cash 0.11

Fixed Income –2.02



Cash 0.33

Cash 0.86


Cash 2.28

3

1 Diversification does not guarantee future results, ensure a profit, or protect against loss.

Diversification1 may increase the growth potential of your investments while reducing the amount of risk to your portfolio.

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Fixed Income11.63

Fixed Income

8.44

Fixed Income 10.26

Mid-Cap Blend 45.51

Foreign Stock 20.25

Foreign Stock 13.54

Foreign Stock 26.34

Large-Cap Growth

11.81

Fixed Income

5.24

Large-Cap Growth

37.21

Mid-Cap Blend 26.71

Fixed Income

7.84

Mid-Cap Blend 17.88

Mid-Cap Blend 36.80


Large-Cap Growth

5.67

Mid-Cap Blend 17.59


Cash 1.87



Cash 4.42

Cash 1.78

Foreign Stock 38.59

Mid-Cap Blend 18.29

Mid-Cap Blend 8.11


Foreign Stock 11.17

Cash 2.06

Mid-Cap Blend 34.39

Large-Cap Growth

16.71

Large-Cap Growth

2.64






Foreign Stock 25.03

Fixed Income

0.01


Cash6.18

Mid-Cap Blend 1.22





Mid-Cap Blend 16.17

Fixed Income

6.97


Foreign Stock 31.78


Large-Cap Blend1.50

Foreign Stock 17.32



Fixed Income

0.55



Large-Cap Growth

–1.51

Mid-Cap Blend 27.77

Mid-Cap Blend 4.27






6.63



6.07




Large-Cap Value0.39



Mid-Cap Blend 7.07


0.13


8.32

Mid-Cap Blend 16.81




–2.14


–6.53




11.13



13.93


Large-Cap Value

–36.85


22.54


13.08

Cash0.10


Foreign Stock22.78


6.79

Cash 0.05

Large-Cap Growth

7.08


15.63


–5.04


22.16





24.90

Large-Cap Growth

6.30

Large-Cap Growth

5.26

Large-Cap Growth

9.07

Cash 5.03



Foreign Stock 7.75


–0.10


12.70


21.59

Fixed Income

5.97


Fixed Income

2.65



Foreign Stock 22.01




Fixed Income

4.10

Fixed Income

4.34

Cash 3.06

Cash 4.83

Mid-Cap Blend 1.38


Fixed Income

5.93

Fixed Income

6.54

Mid-Cap Blend–2.51

Fixed Income

4.21

Cash 0.07

Cash 0.03


Foreign Stock 1.00

Fixed Income

3.54


Fixed Income

8.72




Cash 1.15

Cash 1.33

Fixed Income

2.43

Fixed Income

4.33



Cash 0.21

Cash 0.13

Foreign Stock–12.14

Cash 0.11

Fixed Income –2.02



Cash 0.33

Cash 0.86


Cash 2.28

4

At the heart of our philosophy is one simple idea: You are an individual. Your specific investment needs, goals, and

preferences won’t accommodate a “one size fits all” approach to diversification.

That’s why we’ve built flexibility into our investment lineup. You can:

o Use individual investment options to create your own asset-allocation portfolio (pages 6–7).

o Select among a variety of broadly diversified asset-allocation strategies (pages 8–16).

o Mix and match any combination of investment options to customize your portfolio the way you choose.

Every variable investment option has some degree of risk depending on what it invests in and the strategies it uses.

While all variable investment options are subject to market risk, some investment options may experience greater

volatility than others. The variable investment options are not insured or guaranteed by the Federal Deposit Insurance

Corporation (FDIC). It is possible to lose money by investing in these funds.

If you’ve decided that a variable annuity is right for you, the next decision is how to allocate your contract value among

the investment options. With the help of your financial professional, you can choose an investment strategy that best

fits your retirement goals.

CHOICE AND FLEXIBILITY TO HELP YOU REACH YOUR GOALS

5

In addition to a wide array of asset classes and investment styles to choose from, you and your financial professional

have access to some of the most well-known and respected investment-management firms in the industry. Their

experience and expertise may help you achieve the greatest growth potential for your variable annuity portfolio.

Our investment lineup provides access to the following investment managers:

6

Net fund expenses are as of the most recent fund prospectus (adjusted for any fee waivers/reimbursements). For

more information, including the gross expense ratio, waivers, and/or expense reimbursements, see the applicable fund

prospectus. Expenses are subject to change, and there is no guarantee that the investment advisers will continue to

waive and/or reimburse fund fees beyond their current terms as outlined in each fund prospectus. In addition, please

refer to the variable annuity product prospectus for additional product fees and charges.

INVESTMENT OPTIONS BY ASSET CLASS

All investment options may not be available at all firms or with all Pacific Life variable annuity products. On certain contracts, a living benefit must be elected at contract issue and is not optional. Speak to your financial professional or see the prospectus for more information.

Investment Category Manager/Fund Name Morningstar Category Net Fund Expense (%)

U.S. Fixed-Income Funds

American Funds® IS Bond FundSM Intermediate Core Bond 0.90

American Funds® IS High-Income Bond FundSM High-Yield Bond 1.01

American Funds® IS US Govt/AAA-Rated Securities FundSM Intermediate Government 0.88

Fidelity® VIP Government Money Market Portfolio Money Market—Taxable 0.36

Fidelity® VIP Strategic Income Multisector Bond 0.92

Janus Henderson VIT Flexible Bond Intermediate Core-Plus Bond 0.82

Lord Abbett Bond Debenture Portfolio VC Multisector Bond 0.91

Lord Abbett Total Return Portfolio VC Intermediate Core-Plus Bond 0.73

Pacific Asset Management Core Income Corporate Bond 0.74

Pacific Asset Management Floating Rate Income Bank Loan 0.88

Pacific Asset Management High Yield Bond High-Yield Bond 0.64

PIMCO VIT Income Portfolio Multisector Bond 1.07

PIMCO Inflation Managed Inflation-Protected Bond 1.93

PIMCO Managed Bond Intermediate Core Bond 0.98

T. Rowe Price Short Duration Bond Short-Term Bond 0.64

Western Asset Management Diversified Bond Intermediate Core Bond 0.65

Non-U.S. Fixed-Income Funds

American Funds® IS Capital World Bond FundSM World Bond 0.99

Ashmore Emerging Markets Debt Emerging-Markets Bond 1.03

Templeton Global Bond VIP Fund World Bond 0.76

U.S. Equity Funds

AB Small-Cap Value Small Value 0.98

American Century Value Large Value 0.87

American Century VP Mid Cap Value Mid-Cap Value 1.02

American Funds® IS Blue Chip Income and Growth FundSM Large Value 0.93

American Funds® IS Growth FundSM Large Growth 0.86

American Funds® IS Growth-Income FundSM Large Blend 0.80

BlackRock Equity Index Large Blend 0.28

BlackRock Large-Cap Growth Large Growth 0.89

BlackRock Small-Cap Index Small Blend 0.55

Boston Partners Mid-Cap Value Mid-Cap Value 0.93

ClearBridge Large-Cap Value Large Value 0.84

ClearBridge Variable Aggressive Growth Portfolio Large Growth 1.04

Fidelity® VIP Contrafund® Large Growth 0.86

Franklin Rising Dividends VIP Fund Large Blend 0.89

Franklin/BlackRock Small-Cap Equity Small Value 0.92

Invesco Oppenheimer Main Street® Core Large Blend 0.68

Ivy Mid-Cap Growth Mid-Cap Growth 0.91

Janus Focused Growth Large Growth 0.97

JPMorgan Value Advantage Large Value 0.89

MFS® Growth Large Growth 0.78

MFS® Small-Cap Growth Small Growth 0.84

Scout Investments Mid-Cap Equity Mid-Cap Blend 0.88

T. Rowe Price Dividend Growth Large Blend 0.88

7

Eligible for an optional living benefit. Additional eligible investment option available with Protected Investment Benefit optional benefit.

All investment options may not be available at all firms.

Investment Category Manager/Fund Name Morningstar Category Net Fund Expense (%)

Non-U.S. Equity Funds

American Funds® IS Global Growth FundSM World Large Stock 1.07

American Funds® IS Global Growth and Income FundSM World Large Stock 1.16

American Funds® IS Global Small Capitalization FundSM World Small/Mid Stock 1.26

American Funds® IS International FundSM Foreign Large Growth 1.05

American Funds® IS International Growth and Income FundSM Foreign Large Blend 1.17

American Funds® IS New World Fund® Diversified Emerging Markets 1.09

Franklin Mutual Global Discovery VIP Fund World Large Stock 1.19

Invesco Oppenheimer Emerging Markets Diversified Emerging Markets 1.07

Invesco Oppenheimer V.I. Global Fund World Large Stock 1.02

Invesco Oppenheimer V.I. International Growth Fund Foreign Large Growth 1.25

MFS® International Large-Cap Foreign Large Growth 1.01

QS Investors International Small-Cap Foreign Small/Mid-Blend 1.13

Wellington International Value Foreign Large Value 0.89

Alternative Strategies Funds

Neuberger Berman U.S. Equity Index PutWrite Strategy Portfolio Multialternative 1.06

PIMCO VIT CommodityRealReturn® Strategy Portfolio Commodities Broad Basket 2.26

VanEck VIP Global Hard Assets Fund Natural Resources 1.40

Sector Funds

BlackRock Health Sciences Health 1.14

Invesco V.I. Global Real Estate Fund Global Real Estate 1.29

Ivy VIP Energy Equity Energy 1.29

MFS® Technology Technology 1.15

MFS® VIT Utilities Series Utilities 1.04

Principal Real Estate Real Estate 0.97

Asset-Allocation/Balanced Funds

American Funds® IS Asset Allocation FundSM Allocation—50% to 70% Equity 0.81

American Funds® IS Capital Income Builder® FundSM World Allocation 0.78

American Funds® IS Global Balanced FundSM World Allocation 1.23

American Funds® IS Managed Risk Asset Allocation FundSM Allocation—50% to 70% Equity 0.91

BlackRock Global Allocation V.I. Fund World Allocation 0.99

BlackRock 60/40 Target Allocation ETF V.I. Fund Allocation—50% to 70% Equity 0.33

DFA Balanced Allocation Portfolio Allocation—50% to 70% Equity 0.70

Fidelity® VIP FundsManager® 60% Allocation—50% to 70% Equity 0.84

First Trust Dorsey Wright Tactical Core Portfolio Allocation—70% to 85% Equity 1.30

First Trust/Dow Jones Dividend & Income Allocation Portfolio Allocation—50% to 70% Equity 1.20

First Trust Multi Income Allocation Portfolio Allocation—30% to 50% Equity 1.15

Franklin Allocation VIP Fund Allocation—50% to 70% Equity 0.92

Franklin Income VIP Fund Allocation—30% to 50% Equity 0.71

Invesco V.I. Balanced-Risk Allocation Fund World Allocation 1.05

Invesco V.I. Equity and Income Fund Allocation—50% to 70% Equity 0.80

Ivy VIP Asset Strategy World Allocation 1.02

Janus Henderson VIT Balanced Portfolio Allocation—50% to 70% Equity 0.87

JPMorgan Insurance Trust Global Allocation Portfolio World Allocation 1.17

JPMorgan Insurance Trust Income Builder Portfolio Allocation—30% to 50% Equity 0.93

MFS® VIT Total Return Series Allocation—50% to 70% Equity 0.86

PIMCO VIT All Asset Portfolio Tactical Allocation 1.67

PLFA Pacific Dynamix® Conservative-Growth Allocation—30% to 50% Equity 0.59

PLFA Pacific Dynamix® Moderate-Growth Allocation—50% to 70% Equity 0.59

PLFA Pacific Dynamix® Growth Allocation—70% to 85% Equity 0.59

PLFA Portfolio Optimization Conservative Allocation—15% to 30% Equity 0.92

PLFA Portfolio Optimization Moderate-Conservative Allocation—30% to 50% Equity 0.95

PLFA Portfolio Optimization Moderate Allocation—50% to 70% Equity 0.94

PLFA Portfolio Optimization Growth Allocation—70% to 85% Equity 0.95

PLFA Portfolio Optimization Aggressive-Growth Allocation—85%+ Equity 0.97

State Street Total Return V.I.S. Fund Allocation—50% to 70% Equity 0.92

8

Pacific Dynamix® Portfolios and Portfolio Optimization Portfolios allow you to match the appropriate fund to your

financial objectives, risk tolerance, and time horizon. Each fund is structured as a fund-of-funds (a fund that invests in

other underlying funds) that has been diversified to achieve a specific target-risk level using a strategic mix of multiple

asset classes.

There is a risk that better results could be achieved by investing in an individual fund or funds representing a single asset

class rather than using asset allocation. A fund-of-funds is subject to its own expenses along with the expenses of the

underlying funds. It is typically exposed to the same risks as the underlying funds in which it invests in proportion to the

allocation of assets among those underlying funds, among other risks. Each underlying fund has its own investment goal,

strategy, and risks. The prospectuses for the underlying funds for Portfolio Optimization Portfolios and Pacific Dynamix

Portfolios are available at PacificLife.com.

TARGET-RISK FUNDS

These funds are managed by Pacific Life Fund Advisors LLC (PLFA).

Established in 2007, PLFA provides multi-asset-class solutions through its

Asset Allocation, Manager Oversight, and Investment Risk Management

groups. PLFA is an SEC-registered investment adviser and a wholly owned

subsidiary of Pacific Life Insurance Company (Pacific Life).

As of March 31, 2020, PLFA managed approximately $41 billion in total

assets under management.

9

Each Pacific Dynamix Portfolio is a fund-of-funds that invests in a wide range of index-oriented underlying funds.

o Index-based: Lower expenses associated with passive investment instruments allow a Pacific Dynamix Portfolio to play a key role in managing the cost of your overall investment portfolio.

o Multi-asset-class diversification: Nine underlying investments in the Pacific Dynamix Portfolios offer global investment exposure across numerous asset classes and investment styles.

o Multi-manager asset allocation: Three well-respected money-management firms manage the respective investment sleeves, offering investment depth and knowledge.

PACIFIC DYNAMIX PORTFOLIOS

Fund Portfolio Composition (%) Objective U.S./Global Focus1

Pacific Dynamix® Conservative-Growth

Other %

Cash %

Bond %

Non-US Equity %

US Equity %

Dynamix Conservative Growth

29.60

11.9058.50

Seeks current income and moderate growth of capital.

U.S.

GLOBAL

Pacific Dynamix® Moderate-Growth

Other %

Cash %

Bond %

Non-US Equity %

US Equity %

Dynamix Moderate Growth

44.30

17.30

38.40 Seeks long-term growth of capital and low to moderate income.

U.S.

GLOBAL

Pacific Dynamix® Growth

Other %

Cash %

Bond %

Non-US Equity %

US Equity %

Dynamix Growth

57.0023.00

20.00

Seeks moderately high, long-term growth of capital with low current income.

U.S.

GLOBAL

1 U.S./Global Focus: Generally, a U.S.-focused investment will have an allocation to U.S.-based equity and fixed income that is greater than 60%. A global-focused investment will have an allocation to equity and fixed income, based outside the U.S., that is greater than 40%.

Pie chart allocations reflect information as of 3/31/20 provided by the investment firms managing the respective portfolio(s). Portfolio allocations can fluctuate and may change over time.

Eligible for an optional living benefit.

Additional eligible investment option available with Protected Investment Benefit optional living benefit.

U.S. Equity Non-U.S. Equity Fixed Income Cash Other

BlackRock Investment Management manages the domestic-equity sleeve.

Dimensional Fund Advisors manages the international-equity sleeve.

SSGA Fund Management manages the fixed-income sleeve.

10

Portfolio Optimization Portfolios are managed by a dedicated multi-asset-class solutions team and offer one-step

diversification. The Portfolio Optimization Portfolios range in investment style from conservative to aggressive-growth

to help match your risk tolerance and investment goals. The funds offer:

o One-Step Diversification: Each Portfolio Optimization Portfolio is a fund-of-funds diversified among multiple asset classes, providing you with a core asset-allocation solution to help meet your financial goals.

o A Dedicated Team that Manages Multi-Asset-Class Solutions: PLFA manages and oversees each fund through a multi-step process that includes:

• Asset allocation.

• Manager research.

• Investment risk management.

PORTFOLIO OPTIMIZATION PORTFOLIOS

11

Fund Portfolio Composition (%) Objective U.S./Global Focus1

Portfolio Optimization Conservative

Other %

Cash %

Bond %

Non-US Equity %

US Equity %

Portfolio Optimization Conservative

14.20

82.20

3.60

Seeks current income and preservation of capital.

U.S.

GLOBAL

Portfolio Optimization Moderate-Conservative

Other %

Cash %

Bond %

Non-US Equity %

US Equity %

Portfolio Optimization Moderative Conservative

26.50

9.7063.80Seeks current income and moderate

growth of capital.U.S.

GLOBAL

Portfolio Optimization Moderate

Other %

Cash %

Bond %

Non-US Equity %

US Equity %

Portfolio Optimization Moderate

39.70

11.70

48.60 Seeks long-term growth of capital and low to moderate income.

U.S.

GLOBAL

Portfolio Optimization Growth

Other %

Cash %

Bond %

Non-US Equity %

US Equity %

Portfolio Optimization Growth

52.70

16.60

30.70Seeks moderately high, long-term capital appreciation with low current income.

U.S.

GLOBAL

Portfolio Optimization Aggressive-Growth

Other %

Cash %

Bond %

Non-US Equity %

US Equity %

Portfolio Optimization Aggressive Growth

60.4022.40

17.20

Seeks high, long-term capital appreciation. U.S.

GLOBAL

Eligible for an optional living benefit.

Additional eligible investment option available with Protected Investment Benefit optional living benefit.

U.S. Equity Non-U.S. Equity Fixed Income



12

Not all investment managers adopt the same discipline in their approaches to asset allocation. Pacific Life variable

annuities offer a variety of asset-allocation funds across multiple investment disciplines from well-known and respected

ASSET-ALLOCATION FUNDS

Fund Portfolio Composition (%) Summary U.S./Global Focus1

American Funds® IS Asset Allocation FundSM

Other %

Cash %

Bond %

Non-US Equity %

US Equity %

American Funds IS® Asset Allocation Fund

52.70

8.10

7.80

31.40

American Funds® IS Asset Allocation FundSM has an investment mix falling within the following ranges: 40%–80% in equity securities, 20%–50% in debt securities, and 0%–40% in money-market instruments and cash. The Fund may invest up to 15% of its assets in common stocks and other equity securities of issuers domiciled outside the United States and up to 5% of its assets in debt securities of issuers domiciled outside the United States. In addition, the fund may invest up to 25% of its debt assets in lower-quality debt securities.

U.S.

GLOBAL

American Funds® IS Capital Income Builder® FundSM

Other %

Cash %

Bond %

Non-US Equity %

US Equity %

American Funds IS® Capital Inc Builder® Fund

29.60

36.20

7.30

26.90

American Funds® IS Capital Income Builder® FundSM has two primary investment objectives. It seeks to provide a level of current income that exceeds the average yield on U.S. stocks generally and to provide a growing stream of income over the years. The Fund seeks to provide above-average current income and a growing stream of income from investments in income-providing securities, including established companies that pay high current income or have strong prospects for dividend growth.

U.S.

GLOBAL

American Funds® IS Global Balanced FundSM

Other %

Cash %

Bond %

Non-US Equity %

US Equity %

American Funds IS® Global Balanced Fund

26.10

30.00

37.70

6.20

American Funds® IS Global Balanced FundSM aims to provide long-term growth of capital, conservation of principal, and current income by investing in stocks and bonds from around the world. Typically, stocks account for at least 45% of assets, and bonds at least 30% of assets.

U.S.

GLOBAL

American Funds® IS Managed Risk Asset Allocation FundSM

Other %

Cash %

Bond %

Non-US Equity %

US Equity %

American Funds IS® Managed Risk Asset Allocation Fund

46.60

7.20

18.40

27.80

American Funds® IS Managed Risk Asset Allocation FundSM invests in shares of the American Funds Insurance Series Asset Allocation FundSM while seeking to manage portfolio volatility and provide downside protection. The Fund employs a risk-management overlay to attempt to stabilize the volatility of the Fund around a target volatility level and reduce the downside exposure of the Fund during periods of significant market declines.

U.S.

GLOBAL

Eligible for an optional living benefit. U.S. Equity Non-U.S. Equity Fixed Income Cash Other



13

investment managers. Talk with your financial professional about the discipline—or combination of disciplines—that

can help meet your investment goals.


BlackRock Global Allocation V.I. Fund

Other %

Cash %

Bond %

Non-US Equity %

US Equity %

BlackRock Global Allocation V.I. Fund

38.10

20.60

25.90

11.70

3.70

BlackRock Global Allocation V.I. Fund invests in a portfolio of equity, debt, and money-market securities, seeking diversification across markets, industries, and issuers as one of its strategies to generate long-term growth with less volatility than global equities. The Fund has a flexible and broad investment mandate that seeks growth from high cash-flow equities, equity diversification, and income from bonds, and uses hedging instruments to reduce portfolio volatility. It is well-diversified and has the ability to invest across traditional and non-traditional asset classes, sectors, and capital structure.

U.S.

GLOBAL

BlackRock 60/40 Target Allocation ETF V.I. Fund

Other %

Cash %

Bond %

Non-US Equity %

US Equity %

BlackRock 60/40 Target Allocation ETF V.I. Fund

46.00

17.00

37.00BlackRock 60/40 Target Allocation ETF V.I. Fund seeks to provide total return by investing approximately 60% of the portfolio in equity ETFs and approximately 40% of the portfolio in fixed-income ETFs.

U.S.

GLOBAL

DFA Balanced Allocation Portfolio

DFA Balanced Allocation Portfolio is a fund-of-funds that seeks long-term growth of capital and low to moderate income. The Fund invests in underlying U.S. and international equity and fixed-income Variable Investment Trusts (VITs) and/or Funds managed by Dimensional Fund Advisors LP, and Dimensional Fund Advisors affiliates, and utilizes a transparent and disciplined approach that cost-effectively targets higher expected returns that are consistent across asset classes.

U.S.

GLOBAL

Fidelity® VIP FundsManager® 60%

Other %

Cash %

Bond %

Non-US Equity %

US Equity %

Fidelity® VIP FundsManager 60%

43.24

20.98

Cash –1.31

37.09

Fidelity® VIP FundsManager® 60% is an actively managed portfolio seeking a high total return by investing in a combination of actively managed underlying Fidelity® retail and Variable Insurance Products (VIP) funds. The strategic allocation of 60% equity and 40% fixed income will include a diversified mix of domestic-equity funds, international-equity funds, fixed-income funds, and money-market funds.

U.S.

GLOBAL

Other %

Cash %

Bond %

Non-US Equity %

US Equity %

DFA Balanced Allocation Portfolio

42.20

16.00

41.80


14

ASSET-ALLOCATION FUNDS (cont.)


First Trust Dorsey Wright Tactical Core Portfolio

Other %

Cash %

Bond %

Non-US Equity %

US Equity %

First Trust Dorsey Wright Tactical Core Portfolio

72.39

22.74

0.82

4.05

The investment objective of the First Trust Dorsey Wright Tactical Core Portfolio (the Fund) is to provide total return. The Fund will have minimum and maximum allocations to four asset classes. The Fund seeks to achieve its investment objective by investing, under normal conditions, at least 80% of its net assets (plus any investment borrowings) in ETFs and cash and cash equivalents that comprise the Dorsey Wright Tactical Tilt Moderate Core Index (the Index). The Index will utilize the Dorsey Wright Dynamic Asset Level Investing (DALI) asset-allocation process developed by Dorsey Wright & Associates (DWA) to allocate assets over the four asset classes in the maximum and minimum allocations noted above. The process evaluates the four asset classes and ranks them from strongest to weakest based on their Relative Strength score.

U.S.

GLOBAL

First Trust/Dow Jones Dividend & Income Allocation Portfolio

Other %

Cash %

Bond %

Non-US Equity %

US Equity %

First Trust/Dow Jones Dividend & Income Allocation Portfolio

50.6148.25

1.14

First Trust/Dow Jones Dividend & Income Allocation Portfolio seeks to provide total return by allocating among dividend-paying stocks and investment-grade bonds. The Fund will focus on investing in approximately 50% dividend-paying equities selected from the Dow Jones U.S. Total Stock Market Index, approximately 50% investment-grade bonds of issuers included in the Dow Jones Corporate Bond IndexSM, investment-grade bonds of issuers included in the Dow Jones Industrial Average, and U.S. government and agency securities.

U.S.

GLOBAL

First Trust Multi Income Allocation Portfolio

Other %

Cash %

Bond %

Non-US Equity %

US Equity %

First Trust Multi Income Allocation Portfolio

37.50

62.50

First Trust Multi Income Allocation Portfolio seeks to achieve its objective by following a strategic and tactical asset-allocation process that provides diversified exposure to investment-grade and non-investment-grade debt markets. The Fund will invest among nine income-generating, diversified asset classes: High Dividend Paying Equities, Preferred Securities, Master Limited Partnerships, Real Estate Investment Trusts, High Yield Bonds, Senior Loans, Corporate Bonds, Mortgage Backed Securities, and Treasury Inflation-Protected Securities. These asset classes provide a broader scope of investment opportunities that can offer higher yield and meaningful diversification relative to traditional bond strategies.

U.S.

GLOBAL

Franklin Allocation VIP Fund

Other %

Cash %

Bond %

Non-US Equity %

US Equity %

Franklin Founding Funds Allocation VIP Fund

39.86

Cash –4.56Other –0.32

16.29

48.73

Franklin Allocation VIP Fund seeks capital appreciation with income as a secondary goal by allocating to multiple investment strategies. The strategies are managed by individual Franklin Templeton investment teams, each with its own style and approach. The Fund generally will maintain around a 60/40 equity/fixed-income composition, resulting in a portfolio diversified across asset classes, sectors, regions, and investment styles.

U.S.

GLOBAL




15


Franklin Income VIP Fund

Other %

Cash %

Bond %

Non-US Equity %

US Equity %

Franklin Income VIP Fund

17.64

27.1049.10

6.16Franklin Income VIP Fund follows a value-oriented investment philosophy seeking income and long-term capital appreciation potential by investing in dividend-paying stocks, convertible securities, and bonds. The Fund’s flexible investment approach allows for potential attractive opportunities across market cycles.

U.S.

GLOBAL

Invesco V.I. Balanced-Risk Allocation Fund

Other %

Cash %

Bond %

Non-US Equity %

US Equity %

Invesco VI Balanced-Risk Allocation Fund

53.81

21.737.52

16.94

Invesco V.I. Balanced-Risk Allocation Fund is designed to provide capital loss protection during down markets by investing in multiple asset classes: equities, fixed income, and commodities, such that no one asset class drives the Fund’s performance. Actual allocation will vary based on the manager’s view of risk associated with each asset class. It is expected that the annualized volatility level for the Fund will be, on average, approximately 8%.

U.S.

GLOBAL

Invesco V.I. Equity and Income Fund

Other %

Cash %

Bond %

Non-US Equity %

US Equity %

Invesco VI Equity and Income Fund

6.90

24.00

5.80

63.30

Invesco V.I. Equity and Income Fund seeks to build wealth and manage risk through ownership of large companies the team feels are poised to benefit from positive business developments, while minimizing risk through comprehensive diversification of stocks, bonds, and convertible bonds.

U.S.

GLOBAL

Ivy VIP Asset Strategy

Other %

Cash %

Bond %

Non-US Equity %

US Equity %

Ivy Funds VIP Asset Strategy

29.40

32.50

13.30

20.20

4.60

Ivy VIP Asset Strategy seeks a rate of return competitive with that of global equities with a reduced level of volatility over a full market cycle. It blends an equity sleeve of global equity securities and a diversifying sleeve of fixed income, U.S. Treasuries, precious metals, commodities, and cash. It is not limited by region or asset class and has flexible ranges of 50%–80% of assets for the equity sleeve, with a long-term target of about 65%; and 20%–50% for the diversifying sleeve, with a long-term target of about 35%. The portfolio managers target a level of expected total risk equaling 70%–90% of the risk represented in the benchmark index.

U.S.

GLOBAL

Janus Henderson VIT Balanced Portfolio

Other %

Cash %

Bond %

Non-US Equity %

US Equity %

Janus Henderson VIT Balanced Portfolio

47.5651.80

0.36

0.28

Janus Henderson VIT Balanced Portfolio is a multi-asset portfolio offering the potential for long-term capital appreciation with the flexibility to navigate uncertain and volatile markets. The Fund invests 35–65% of its assets in equity securities, depending on market conditions, and the remaining assets in fixed-income securities and cash equivalents. The Fund’s dynamic asset-allocation strategy attempts to defensively position ahead of market volatility while seeking strong, risk-adjusted returns.

U.S.

GLOBAL


16


JPMorgan Insurance Trust Global Allocation Portfolio

Other %

Cash %

Bond %

Non-US Equity %

US Equity %

JPMorgan Insurance Trust Global Allocation Portfolio

32.39

22.40

Cash –10.53

55.74

The Fund seeks to maximize long-term total return. It invests in a broad range of equity, fixed-income, and alternative asset classes in the U.S. and other markets throughout the world, both developed and emerging. Investment insights are developed through top-down macro views combined with bottom-up views of JPMorgan asset-class specialists globally.

U.S.

GLOBAL

JPMorgan Insurance Trust Income Builder Portfolio

Other %

Cash %

Bond %

Non-US Equity %

US Equity %

JPMorgan Insurance Trust Income Builder Portfolio

14.93

18.44

51.46

7.517.66 The Fund seeks to maximize income while maintaining

prospects for capital appreciation. It invests in income-producing securities, including debt and equity securities, from both developed and emerging markets. The management team has wide latitude to allocate the Fund’s assets among strategies and asset classes.

U.S.

GLOBAL

MFS® VIT Total Return Series

Other %

Cash %

Bond %

Non-US Equity %

US Equity %

MFS VIT Total Return

55.60

4.40

39.50

0.50

MFS® VIT Total Return Series invests approximately 60% of the Fund’s assets in equity securities and approximately 40% of the Fund’s assets in debt instruments. The Fund’s equity holdings focus on income-producing equity securities and companies it believes are undervalued compared to their perceived worth (value companies), and primarily with large capitalizations. Of the Fund’s investments in debt instruments, MFS generally invests substantially all of these investments in investment-grade quality debt instruments.

U.S.

GLOBAL

State Street Total Return V.I.S. Fund

Other %

Cash %

Bond %

Non-US Equity %

US Equity %

PIMCO VIT All Asset All Authority

32.31

32.51

22.13

3.76

9.29

State Street Total Return V.I.S. Fund is a broadly diversified portfolio that provides exposure to three primary asset classes: (1) Equity securities (U.S. and non-U.S.), (2) Fixed Income (U.S. and non-U.S.), and (3) alternative-style investments. The Fund’s overall strategic target allocation range is: 45–65% equity securities, 30–50% fixed-income securities, and 3–15% alternative investments. The Fund’s managers may from time to time make tactical adjustments to the Fund’s allocation to a particular sub-asset class to pursue short- to intermediate-term opportunities based on a broad range of market and economic conditions, and a combination of quantitative and fundamental evaluation.

U.S.

GLOBAL

ASSET-ALLOCATION FUNDS (cont.)




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VARIABLE ANNUITIES INVESTMENT GUIDE · VARIABLE ANNUITIES INVESTMENT GUIDE As of 5/1/20 INVESTMENT...

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