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[Type of Presentation]
MARCH 2010
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Sun Life Financial:
ABOUT US
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Our mission: help clients achieve lifetime security
Protection Savings
Imp
orta
nce
Buy a car
Changing Needs (Age)
Protect loves ones if I die
Provide income if unable to work
Save for education
Begin retirement savings (tax advantages)
Buy a home Protect savings
from market volatility
Start a business
Protect my business
Protect assets if a loved one becomes ill
Buy a second home
Early retirement
Travel
Protect assets from major health set back
Retirement
Pass on assets
20 30 40 50 60 70 80
Providing solutions across a lifespan of financial needs
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Global leader operating in 22 countries worldwide
Sun Life Financial around the world
MFS Headquarters
MFS investment and marketing/service offices
Canada
United States
Bermuda
IrelandUnited Kingdom
China
Hong KongIndia
Phillippines
Indonesia
Toronto
Mexico City
Sao Paulo
Bueno Aires
London
Madrid
Milan
RotterdamBerlin
Munich
Tokyo
Taipei
Sydney
Singapore
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0 5 10 15 20 25 30 35
Protective
Stancorp
Industrial Alliance
Genworth
AIG
Unum
Lincoln
Principal
Ameriprise
Hartford
Sun Life
Prudential
Great West
MetLife
Manulife
Fifth largest insurer in North America
* Bloomberg, October 30, 2009
Market capitalization in billions
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U.S.Canada MFS Asia U.K.
• Individual Life and Health
• Group Life and Health
• Group Pension
• Mutual Funds
• Asset Management
• Mutual Funds
• Asset Management
• Life and Annuity Policies
• Individual Life
• Individual Annuity
• Group Life and Health
• Individual Life and Health
• Individual Annuity
• Group Life and Health
• Group Pension
• Mutual Funds
• Asset Management
Products and Services
Sun Life Financial
Diversified mix of products and services
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Geographic Diversification* Business Diversification**
* Based on LTM Q3 2009 Revenue (C$): Excludes proceeds from gain on sale of CI Financial
**Based on LTM Q3’09 VNB (C$)
LTM Q3 2009
40%
Wealth Management
60%Protection
Canada
42%40%
U.S.
8%
6%7%
Corporate
Asia
MFS
Diversified sources of revenue
Percent of revenue by geography and product category
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1 Outlook stable. 2 Negative outlook.As of September 31, 2009
A.M.Best(as of Feb. 2009)
Standard & Poor’s(as of March 2009)
Moody’s(as of Feb. 2009)
Sun Life Assurance Company of Canada
A+1 (Superior)Second of 16 rating levels
AA2 (Very Strong)Third of 20 rating levels
Aa31 (Excellent)Fourth of 21 rating levels
Sun Life Assurance Company of Canada (U.S.)
A+1 (Superior)Second of 16 rating levels
AA2 (Very Strong)Third of 20 rating levels
Aa32 (Excellent)Fourth of 21 rating levels
Sun Life Insurance and Annuity Company of New York
A+1 (Superior)Second of 16 rating levels
AA2 (Very Strong)Third of 20 rating levels
Not rated
Among the industry’s most highly rated companies
Ratings from independent industry analysts
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1 The Other category is composed primarily of policyholder loans, derivative assets, investments in limited partnerships, and our equity investments in MFS. Four percent, or $4.5 billion, is invested in equities. About 50% of this equity portfolio is invested in North American exchange-traded funds, with the remainder invested in common and preferred shares in Canada, the United States, the United Kingdom, and Asia (primarily in Hong Kong).
Prudently invested company assets
Percentage of assets invested in different asset classes
8%Equities
Cash
Real Estate
Other1
5%
4%
7%Bonds
55%Mortgages and Corp Loans
21%
• Bond portfolio includes over 1,200 borrowers from around the world; and 97% of total bond portfolio was investment grade
• Holding $8.9B in cash, cash equivalents and short-term securities, and $13B in government bonds
• Exposure to residential sub-prime and Alt-A loans was $350M (92% issued before 2006 or have an AAA rating)
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Disciplined investment philosophy
145 years of financial stability
Total assets under management of US:$385 billion (as of September 30, 2009for the Sun Life Financial group of companies)
How we manage risk:• Pillars of risk management • Safeguarding reserves and capital• Prudent investment approach• Active risk management
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How we’re communicating our financial strength
• Over 20 million customers worldwide
• 145 years in business• A+ credit rating• Never taken bailout money
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Sun Life Financial’s connection with Churchill
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Churchill promotion
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1988Introduces SLF Futurity brand
1982Introduces first VA with no upfront sales charge
1971Enters annuity market with variable annuity
2000Initial Public Offering (ticker symbol SLF)
1989Introduces MFS Regatta brand
2004 Introduces Sun Life Financial Masters brand
2007Introduces Income ON Demand
1865Company is chartered
1982Acquires MFS
1999Introduces Earnings Enhancement Benefit
2008Introduces Retirement Income Escalator
1895Enters U.S. market
History of innovation
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In the U.S.:
• 8 dedicated departments
• 150+ employees
• 75 actuaries hold FSA professional designation
• 10 CFAs
Risk management: general
“Strong” enterprise risk
management 2008 score
from Standard & Poor’s.
This rating placed us in
the upper echelon of
rated North American
insurers for 2008.
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Strategic ways we minimize risk
•Risk management oversight of product development process• Peer review• Corporate Office sign-off
•Hedging programs• First VA hedges put on in 1999• VA dynamic hedging since 2004 —
system originally developed in 1990s for other products
• Externally peer reviewed
•Risk tolerance limits• Board-mandated risk limits and
reporting• Chief Risk Officer oversight and
monitoring
•Stochastic valuation• Canadian “principles-based” reserves• Regulatory capital — Canadian
and U.S.• Economic Capital under development
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Q1 2010
Fees CompensationOptional Death
Benefits
Withdrawal Benefit % and Tiers
Initial Equity
Allocation
Ongoing Equity
Allocation
Step Ups
No. of Benefits
Phase 1Q1 & Q2 2009
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Phase 2Q3 2009
Phase 32010 3
Ongoing de-risking of our variable annuity products
Product levers to impact risk and profitability
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Strong corporate reserves and capital position
•Sun Life Assurance Company of Canada (U.S.)• NAIC Risk Based Capital (“RBC”):
Expected minimum ratio:
200%
•Sun Life Assurance Company of Canada • Minimum Continuing Capital & Surplus Requirement (MCCSR)
Sun Life RBC ratio as of 12/31/08:
150%
Sun Life RBC ratio as of 12/31/08:
357%
Sun Life MCCSR ratio as of 9/30/09:
357%
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Leve
l of
Str
ate
gic
Alig
nmen
t
HIGH
Loss Control Balance Sheet Protection
ComplianceCompliance
Loss MinimizationLoss Minimization
Risk MeasurementRisk Measurement
Risk ManagementRisk Management
Return OptimizationReturn Optimization
Risk Management Objective
Weak Practices
Better Practices
Best Practices
Risk / Return Optimization
Value Maximization
LOW
Best practices risk management
Strategic Planning IntegrationStrategic Planning Integration
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Our annuity product strategy
•Product focus• Focus on core VA product• Opportunistic approach to FA• Exiting non-registered FIA• Examining market and product
extensions
•Simplified VA product portfolio• Reduced number of living and death
benefits from 12 to 3
•Product design changes to align interests of shareholder, customer & distributor• Reduced equity exposure• Reduced benefits/increased fees
in line with competition• Reduced compensation
Result: Current product improves profitability and has reduced the capital at risk
MCCSR Ratio
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2004 2005 2006 2007 2008
Represents the MCCSR ratio of Sun Life Assurance Company of Canada and the RBC ratio of Sun Life Assurance Company of Canada (U.S.).
RBC Ratio 404% 407% 339% 358% 300-350%
Note: MCCSR applies to all Sun Life, while RBC applies to Sun Life U.S. only (approx 20% of total capital base)238% 216%
222%
213%
232%
Well capitalized: MCCSR Ratio
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About Sun Life Financial
BUSINESS OVERVIEW
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The market potential for each business will drive our actions
Markets
Products Develop focused portfolio to meet evolving distribution and customer needs and deliver shareholder value
Operations and Culture Anticipate and efficiently service customer needs through a high performance culture
Financial and Risk Management
Distribution Expand distribution capacity and capability
Ensure growth is profitable and sustainable Leverage risk management as a core discipline
Solid foundation for sustainable growth
•Drive focus, build scale and simplify
Percentage of revenues by business line
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50%Annuities
29%Individuals
21%Employee Benefits Group
2009 revenue by business unit
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Aligning markets, products and distribution
Annuities EBG Life
Wholesale Distribution (SLFD/EBG) Strategic Partnerships
WirehousesRegional
IndependentFirms
BanksBroker
General Agents
BrokersConsultants
Consumer
Marketing
Business and Product Lines
• Variable Annuities • Core Universal Life• M Financial
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About Sun Life Financial
BRAND
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Increasing brand awareness
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Increasing brand awareness
•Goal• Increase aided brand awareness
to drive profitable growth
•Targets• Financial professionals• Consumers
•Advertising Strategy• Drive name recognition and inform• Be fun and engaging• Employ viral elements to create buzz
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Consumers Financial Intermediaries
Media focus on thought leadership
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Cirque du Soleil sponsorship
•Official Insurance Sponsor U.S. Big Top and Arena Touring Shows • Added touch points with our target• Alignment with premiere properties• On-site branding and visibility• Co-branded marketing exposure• Rights to use Cirque du Soleil logos,
imagery and music
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Sun Life stadium
• Multi-year naming rights• National and international
exposure• Florida Marlins• Miami Dolphins• University of
Miami Hurricanes• Orange Bowl• BCS Championships• 2010 Pro-Bowl and
Super Bowl • Over 1 Billion impressions
BEFORE Super Bowl• 46.4 per cent of households
watched the Super Bowl in the U.S. alone!
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Philanthropic elements
• Over $1 million commitment to improving educational opportunities for our nation’s at-risk youth.
• Will recognize and provide grants, scholarships and financial education resources to at-risk high school students and the non-profit organizations who work on their behalf.
• Focus is on six U.S. markets: Detroit, San Diego, New York, Seattle, Boston and Miami – markets in which the graduation rate falls below the national average.
www.sunliferisingstar.com
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Showcasing thought leadership
“Lengthy Recovery Results in Pessimism”
– Associated Press
“More Planning to Postpone Retirement” – Ignites
“Survey: Many Americans Now Plan to Work Past 67” – Time Magazine
“Sun Life: More Expect to Delay Retirement” – National Underwriter
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Operations Managers’ Roundtable
3rd out of 16 providers2008 Ranking of annuity insurance carriers’
back-office service
1st out of 18 VA Providers2006 Study of Bank and
Brokerage Retail Investment Services
2008, 2007, 2006, 2005 Award for Financial
Intermediary Post-Sale Service
Quality awards
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About Sun Life Financial
LEADERSHIP
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SLF leadership: presidents
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About Sun Life: biographies
•Westley V. ThompsonPresidentSun Life Financial U.S.
• Westley V. Thompson is President, Sun Life Financial U.S. He was named to this position in October, 2008.
• Prior to his appointment at Sun Life Financial, he was President of the Retirement Solutions division of Lincoln Financial Group.
• Mr. Thompson joined Lincoln Financial Group in 1998, through the company’s acquisition of CIGNA individual insurance. In 2000, Thompson formed and built Lincoln Financial Distributors (LFD), the wholesaling distribution organization of Lincoln Financial Group. In 2006, Mr. Thompson was named president of the Employer Markets segment of Lincoln Financial Group.
• Mr. Thompson started his career at Aetna in 1979 in their executive management program. He went on to a series of assignments of increasing responsibilities within Aetna’s personal financial security division and individual life strategic business unit. In 1994, Thompson joined CIGNA to build an independent brokerage distribution capability for CIGNA’s individual insurance division.
• Mr. Thompson received a bachelor’s degree from Brown University. He is an active board member of LIMRA International and several community-based organizations, including the Boys and Girls Club of Greater Hartford, the Wadsworth Antheneum-Amistad Foundation and the Connecticut Science Center, located in Hartford. Mr. Thompson has been actively involved in youth soccer programs for the past 20 years.
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About Sun Life: biographies
•Terry MullenPresident, Sun Life Financial Distributors, Inc.Sun Life Financial U.S.
• Terry Mullen is President, Sun Life Financial Distributors, Inc.
• Mr. Mullen joined Sun Life Financial in October 2008, and is responsible for all aspects of distribution for life and annuities products and services.
• Prior to his appointment at Sun Life Financial, he was President and Chief Executive Officer of Lincoln Financial Distributors, Inc. (LFD), the wholesaling distribution organization for Lincoln Financial Group. He held this position since December 2006.
• Mr. Mullen joined Lincoln Financial Group in June 2003 as Senior Vice President and Managing Director of the American Legacy business unit of LFD where he was responsible for the reorganization of the American Legacy wholesaling force. More recently, Mr. Mullen served as Senior Vice President and Head of Sales for LFD until his appointment as President and Chief Executive Officer.
• Prior to joining Lincoln Financial, Mr. Mullen was the Senior Vice President, National Sales Manager and Managing Director for Seasons Select at AIG SunAmerica. Prior to joining AIG SunAmerica, Mr. Mullen had a nine-year career in sales and marketing, and held various marketing director roles within American Skandia, Dean Witter Reynolds, Inc., Keyport Life Insurance Company, Inc. and Planco Financial Services.
• Mr. Mullen holds a Bachelor’s degree in Business Administration and Finance from the University of Delaware. He is a licensed securities dealer with Series 6, 26 and 63 designations, is insurance licensed, and an active board member of the Insurance Retirement Institute (IRI).
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About Sun Life: biographies
•Priscilla S. BrownSenior Vice President, Head of MarketingSun Life Financial U.S.
• Priscilla S. Brown is Senior Vice President, Head of Marketing, of Sun Life Financial U.S. She was named to this position in January 2009.
• Recognizing that one’s perception of a brand is rooted in the interactions one has with the company and its products, Sun Life is broadening the traditional definition of brand to include all aspects of the customer experience. Ms. Brown is responsible for aligning Sun Life’s U.S. marketing efforts across all channels and creating an integrated marketing and branding strategy that enhances the profile of our brand and its value to our business.
• Prior to her appointment at Sun Life Financial, she was Chief Marketing and Brand Officer of Lincoln Financial Group. She joined Lincoln Financial Group in 1991, where she was appointed to several leadership positions, beginning with Vice President, Lincoln National Investment Management. Two years later she became chairperson, Lincoln Advisor Funds. In 1994, Ms. Brown was appointed President, Lincoln National Equity Sales, and in 1998, she was appointed Vice President, Investor Relations. Ms. Brown was appointed Vice President, Corporate and Public Affairs in 2003, a position she held under her appointment as Chief Brand Officer in 2006. Strategic Marketing was added to her responsibilities in 2008.
• Prior to joining Lincoln Financial Group, Ms. Brown held marketing, sales and sales management roles at The Equitable Life Assurance Society and Paine Webber.
• Ms. Brown began her career in electronic news working as intern, reporter and producer for KQED-TV, the PBS affiliate in San Francisco and WMAQ, the NBC affiliate in Chicago.
• She and her husband, Payne, have two children.
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About Sun Life: biographies
•Janet V. WhitehouseSenior Vice President and General Manager, Individual Life InsuranceSun Life Financial U.S.
• Janet V. Whitehouse is Senior Vice President and General Manager of the Individual Life Insurance Division of Sun Life Financial’s U.S. Operations. She was appointed to this position in November 2008. In this role, Ms. Whitehouse is responsible for the strategic review, direction and execution of Sun Life’s Individual Life Insurance business.
• Prior to her current role, Ms. Whitehouse served as Senior Vice President and General Manager of SLF’s Employee Benefits Group, from February to October 2008. In this role,she had profit and loss responsibility for SLF EBG’s Life, Disability, Stop-Loss, Dental and worksite businesses.
• Ms. Whitehouse joined Sun Life Financial in 2000 as Vice President, Strategic Initiatives, in which she was responsible for Market Research and Development, E-Business and Development of new ventures into worksite marketing and other areas. In 2002, Ms. Whitehouse was appointed Senior Vice President, Human Resources and Public Relations for Sun Life’s Financial’s U.S. Operations, a position she held until February 2008.
• In 2007, Ms. Whitehouse played key roles in the divestitures of Sun Life Retirement Services (U.S.), Inc. (RSI) and Independent Financial Marketing Group (IMFG), and led the integration of Genworth Financial, Inc., employee benefits group business acquisition.
• Before joining Sun Life Financial, Ms. Whitehouse served as Senior Vice President at Duncanson & Holt, a subsidiary of UNUM Corporation. She also held various positions for UNUM and other subsidiaries since 1985, including Vice President, Corporate Development, Vice President, European Development and President and Chief Operating Officer for Commercial Life, a subsidiary of UNUM Corporation.
• Ms. Whitehouse graduated from the University of Connecticut, where she received a Bachelor of Science, and the University of New Hampshire from which she earned a Masters of Business Administration, majoring in Marketing and Finance.
•Daniel O’SheaSenior Vice President, Individual Life SalesSun Life Financial U.S.
• Daniel O’Shea is Vice President of Individual Life Sales for Sun Life Financial Distributors. He was appointed to this position in October of 2009. In this role, Mr. O’Shea is responsible for expanding the distribution channel strategy for our Individual Life insurance business and creating a value proposition for differentiating in this channel.
• Mr. O’Shea has over 20 years of successful distribution, life sales and marketing experience. Previously, he worked at Principal Financial, where he led the strategic development, design, execution and management of the company’s Life Brokerage distribution channel. He also worked at Lincoln Financial in sales management leadership roles for BGA distribution and then as National Sales Manager of Retail distribution.
• Mr. O’Shea has a BA from Framingham State College and holds his Series 6, 63, and 26.
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About Sun Life: biographies
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•Gregory Smith Senior Vice President, Affiliated ChannelSun Life Financial U.S.
• Gregory Smith is Senior Vice President of Sun Life Financial Distributors’ Affiliated Channel. He was appointed to this position in December of 2009. In this role, Mr. Smith is responsible for developing and executing the affiliated distribution channel strategy for the Individual Life insurance business.
• Mr. Smith was most recently Senior Vice President and Channel Head, Strategic Distribution for ING in Minnesota responsible for the design, implementation, and execution of ING’s closely aligned retail Life and Annuity distribution strategy. Prior to that, he was Sr. Vice President and Channel Head of the Financial Institutions Division at Lincoln Financial where he oversaw the redesign and alignment of the bank channel’s product, marketing, and sales strategy. Past roles also include Sr. Vice President of Financial Institutions at Zurich Kempler where he successfully grew the bank channel's VA sales from $25 million annually to $2 billion in just three years.
• Mr. Smith has a Masters Degree from the University of Chicago Graduate School of Business and a BA from Morehouse College, Atlanta, GA and holds his Series 7, 24, 52 and 63 licenses.
About Sun Life: biographies