Versa-Flex PRO II-CVFlexible Premium Universal Life Insurance

Death Benefit Protection, Cash Value AccumulationClient Guide

Pacific Life Insurance Company

VFPRO2-2C

Death Benefit Protection and Simple, Efficient Income Planning

1 Policy Form No. P10VP2.2 Some features mentioned above are available only by selecting optional riders at issue. Riders will likely incur additional charges and are subject to availability, restrictions and

limitations. When considering a rider, request a policy illustration from your life insurance producer to see the rider’s impact on your policy’s values.3 Policy charges may exceed the interest credited, in which case additional premiums may be required to keep the policy in force. See page 8 for policy charge details.4 Tax-free income assumes, among other things: (1) withdrawals do not exceed tax basis (generally, premiums paid less prior withdrawals); (2) policy remains in force until

death; (3) withdrawals taken during the first 15 policy years do not occur at the time of, or during the two years prior to, any reduction in benefits; and (4) the policy does not become a modified endowment contract. See IRC Sections 72, 7702(f)(7)(B), 7702A. Any policy withdrawals, loans and loan interest will reduce policy values and may reduce benefits.

Building sand castles. Building your financial future. Both require a little imagination, an idea of how you want it to look, and the understanding that an unexpected wave can change your plan at any moment. To help build the future you have in mind—buying a bigger house, sustaining a family business, retiring—you need protection as well as flexibility.

Versa-Flex Pro II-CV1 Versa-Flex PRO II-CV provides flexible death benefit protection and premiums you control. Pay as little as your planned no-lapse premiums2 or pay up to the policy limits, according to any schedule you choose. Your policy’s cash value will be credited at least the guaranteed minimum interest rate.3 You may supplement your income through tax-free4 policy loans and withdrawals from your policy’s available accumulated value. If your coverage needs change, you can adjust your policy to match.

Versa-Flex PRO II-CV offers:2

• Flexible coverages to tailor a death benefit for your needs.• Guaranteed 3% minimum interest rate and current interest rate bonus in

policy years 21+.• Zero net-cost policy loans in policy years 6+ on a current basis

(0.25% net loan cost guaranteed in all policy years).• Automated Income Option to structure a directly deposited, tax-free4

income stream.• Riders to help enhance early cash surrender values and protect

loan-oriented policies from lapse.

Investment and Insurance Products: Not a Deposit Not Insured by any Federal Government AgencyNot FDIC Insured No Bank Guarantee May Lose Value

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Flexibility that Works for You — Inside Versa-Flex PRO II-CV

Versa-Flex PRO II-CV’s flexibility

is apparent before you make

your first premium payment.

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5 Universal life insurance generally requires additional premium payments after the initial premium. If either no premiums are paid, or subsequent premiums are insufficient to continue coverage, it is possible that coverage will expire.

Choose Your Premiums5 You can adjust the amount of each premium payment based on your policy’s death benefit and financial objectives, as long as you have enough accumulated value to cover monthly policy charges.

With Versa-Flex PRO II-CV, you can decide how much (up to policy limits) or how little to pay in premiums. To help you remember to send in premiums on a regular basis, you can choose to set up premium reminders to be sent annually, semi-annually, quarterly, or monthly. Monthly payments will be set up as automated debits from your bank account. The minimum recurring payment is $50.

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Basic Coverage Type-CV on Primary Insured

Additional Coverage on Primary Insured with Cash Surrender Value Enhancement

Term on Primary Insured

Term on Family Members

6 Riders will likely incur additional charges and are subject to availability, restrictions and limitations. When considering a rider, request a policy illustration from your life insurance producer to see the rider’s impact on your policy’s values.

Build the Coverage that Matches Your Need

How you structure your Versa-Flex PRO II-CV policy will determine its ultimate flexibility. With the help of your life insurance producer, you can design what’s right for you by selecting among a wide range of flexible coverage types.

Different Coverages to Meet Different Needs

1. Start with Basic Coverage■ Basic Coverage Type-CV—This is where your protection begins. Basic Coverage Type-CV provides a foundation of life insurance protection on the primary insured. After establishing a minimum of $1,000 on the primary insured, you can enhance your policy’s protection by adding different coverage types.

2. Add Term Coverage to Meet Your Needs■ Annual Renewable Term Rider (ARTR) (Form #R10ARI)6—May be combined with Basic Coverage to provide level or varying amounts of term insurance on the primary insured. If increases are scheduled at policy issue, no further evidence of insurability would be required unless an increase is over certain limits.

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3. If Appropriate, Add Coverage on Primary Insured While Enhancing Your Policy’s Early Cash Surrender Values ■ SVER Term Insurance Rider (SVER-I) (Form #R09SVERI)6—Can be combined with Basic Coverage and ARTR Coverage to provide additional coverage on the primary insured. Doing so allows you to establish a higher early cash surrender value relative to premiums paid, but generally less cash surrender value after the 10th policy year compared to Basic Coverage only.

■ SVER Term Insurance Rider–Trust/Executive Benefit (SVER-T) (Form #R09SVERT)6—Available to corporate-owned, corporate trust-owned, or corporate-sponsored entities. Provides the same benefits as SVER-I in addition to an early termination credit that increases the net cash surrender value upon a qualifying policy surrender within the first 12 policy years.

4. Add Term Coverage on Your Family ■ Annual Renewable Term Rider–Additional Insured (Form #R08RTA)6— Provides term life insurance coverage on any member of the primary insured’s immediate family.

■ Children’s Term Rider (Form #R84-CT)6—Provides term coverage on the lives of the insured’s children.

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Death Benefit

Death Benefit

Fac

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Fac

e A

mo

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T ime T ime

Premium– Withdrawals

Amount

Net Amount at Risk*

Accumulated Value Net Amount at Risk*

Accumulated Value

Death Benefit

Net Amount at Risk*

T ime

Fac

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mo

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Accumulated Value

Option A Option B Option C

* Net Amount at Risk is the difference between your policy’s death benefit and your accumulated value. It is used in determining your policy’s Cost of Insurance charges.

7 For federal income tax purposes, life insurance death benefits generally pay income tax-free to beneficiaries pursuant to IRC Sec. 101(a)(1). In certain situations, however, life insurance death benefits may be partially or wholly taxable. Situations include, but are not limited to: the transfer of a life insurance policy for valuable consideration unless the transfer qualifies for an exception under IRC Sec. 101(a)(2) (i.e., the transfer-for-value rule); arrangements that lack an insurable interest based on state law; and an employer-owned policy unless the policy qualifies for an exception under IRC Sec. 101(j).

8 The maximum issue age for Death Benefit Option C is 80. The maximum Death Benefit calculated will not exceed the amount shown in the Policy Specifications as the “Option C Death Benefit Limit” except as described in the Death Benefit Qualification Test, Tax Qualification as Life Insurance, and Modified Endowment Contract Tax Status sections of the Policy.

Select Your Death Benefit Option

You may choose from among three Death Benefit Options to determine the growth of the primary insured’s coverages. No matter which option you choose, your beneficiaries will benefit from federal income tax-free7 death benefit proceeds.

Option A—Often called a “level death benefit,” this death benefit is equal to the face amount (sum of coverages on primary insured).

Option B—Known as an “increasing death benefit,” this death benefit equals the face amount plus the growth of your accumulated value.

Option C— With this “return of premium death benefit,” your death benefit equals your policy’s face amount plus all premiums you’ve paid, less withdrawals.8

Decide Now, Switch Later Choose a Death Benefit Option and initial face amount based on your current life insurance needs. Should your life insurance needs change, you can change your Death Benefit Option and face amount later. Certain guidelines apply, such as increases are only allowed once per year and a Death Benefit Option may only be changed to Option A or Option B. See your policy for details.

If the switch in Death Benefit Option or unscheduled increase results in a higher death benefit, you may be required to submit current evidence of insurability. Because changes can affect Net Amounts at Risk, you may also incur additional policy charges or tax consequences.

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9 Riders will likely incur additional charges and are subject to availability, restrictions and limitations. When considering a rider, request a policy illustration from your life insurance producer to see the rider’s impact on your policy’s values.

Scheduling Convenience Some insurance goals rely on the ability to gradually increase the death benefit over time. You can simplify this process by scheduling all future death benefit increases at issue through the varying form of the Annual Renewable Term Rider (ARTR) (Form #R10ARI).9 All future increases will be underwritten at issue so when the time comes to increase coverage, no additional underwriting will be required as long as the increase is within certain limits.

Adjust Your Coverage With the help of your life insurance producer, you can determine the right death benefit for your current needs. If your needs should change in the future, you can request increases and decreases in your coverage, subject to the following conditions:

Increases• Available anytime.• Minimum: $25,000.• Subject to an administrative charge.• Requires new underwriting approval.• Will result in additional policy charges

and a new surrender charge period.*

• May increase premiums.

Decreases• Available once per year after first policy

anniversary.• Must have at least $1,000 Basic

Coverage amount remaining, after decrease.

• No administrative charge.• May not necessarily reduce policy

charges.

* A 10-year surrender charge period applies to each layer of Basic Coverage – whether it is included at policy issue or added later through increases.

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Protect Your Policy from Lapse

10 Riders will likely incur additional charges and are subject to availability, restrictions and limitations. When considering a rider, request a policy illustration from your life insurance producer to see the rider’s impact on your policy’s values.

Once you’ve designed the right coverage for your needs, make sure it stays in-force. For no extra charge, you can enjoy no-lapse protection through the Short-Term No-Lapse Guarantee Rider (Form #R02NL5).10 As long as you pay at least the required no-lapse premium stated in your policy, your death benefit (including any coverages added through optional riders) is guaranteed against lapse for the duration stated in the chart below. If policy loans or withdrawals are taken, additional premiums may be required to maintain your no-lapse guarantee.

For example, a policy for an insured aged 45 at issue would have a 20-year no-lapse guarantee period. A policy for an insured aged 60 at issue would have a 10-year no-lapse guarantee period.

Age at Issue Guarantee Period (Years)

Age at Issue Guarantee Period (Years)

20-50 20 58 12

51 19 59 11

52 18 60 10

53 17 61 9

54 16 62 8

55 15 63 7

56 14 64-70 6

57 13 71-75 4

Paying only the Short-Term No-Lapse Premiums will guarantee the death benefit from 4 to 20 years, based on insured’s age at issue, but will not guarantee cash value accumulation. If you discontinue paying the Short-Term No-Lapse Premiums, the no-lapse feature will terminate before the guaranteed duration. Additional premiums will be required to continue the policy beyond the guaranteed duration.

As your dreams grow,

your Versa-Flex PRO II-CV

accumulated value can grow with them.

Grow Your Accumulated Value

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Understanding the Crediting Rate

With Versa-Flex PRO II-CV, your policy’s accumulated value can grow, which you may later use for supplemental income. Moreover, any accumulated value growth in your life insurance policy is tax-deferred.

Your policy’s accumulated value is comprised of the:• Sum of your premium payments less premium loads• Minus policy charges• Plus credited interest

Each year, your policy’s accumulated value will be credited with at least 3.00%—we guarantee it.

The current crediting rate may be higher, is guaranteed for the first policy year, and may be changed periodically thereafter. While the current rate your policy earns may vary, it will never fall below a minimum guaranteed rate of 3.00%.

Bonus Interest Rate As an added bonus, we may increase the current interest rate credited to policies in or after their 21st policy year by an additional 0.20%. This bonus rate is not guaranteed.

Policy Charges The cost of the life insurance and benefits provided through the policy is deducted monthly in the form of policy charges, which include an Administrative Charge, Coverage Charge, Cost of Insurance Charge, and any applicable rider charges. Additionally, a premium load is deducted from each premium payment. To understand how the policy charges will affect your policy’s cash value, request a personalized illustration that includes the “Analysis of Charges” report.

Access Your Policy’s Accumulated Value for Income

Help meet your income goals through tax-free11 withdrawals and policy loans from your policy’s accumulated value.

Withdrawals• Available after first policy year.• $25 fee for each withdrawal (currently waived).• Minimum Amount: $200• Maximum Amount: Cash surrender value minus total policy debt minus $500.

Policy Loans• Minimum Amount: $200 (in most states).• Maximum Amount: Cash surrender value minus total policy debt minus three times

the most recent monthly policy charges.• Loan interest rate charged is offset by interest rate credited to

loan account.

Zero Net-Cost Loans in and after Policy Year 6(based on current annual rates)

Policy Year

Annual Interest Charged

Annual Interest Credited

Annual Net Cost

All Policy Years (guaranteed) 3.25% 3.00% 0.25%

Policy Years 6+ (current) 3.25% 3.25% 0.00%

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11 Tax-free income assumes, among other things: (1) withdrawals do not exceed tax basis (generally, premiums paid less prior withdrawals); (2) policy remains in force until death; (3) withdrawals taken during the first 15 policy years do not occur at the time of, or during the two years prior to, any reduction in benefits; and (4) the policy does not become a modified endowment contract. See IRC Sections 72, 7702(f)(7)(B), 7702A. Any policy withdrawals, loans and loan interest will reduce policy values and may reduce benefits.

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Transfer Policy Distributions to Your Bank Account on a Steady BasisThe Automated Income Option deposits recurring policy loans and withdrawals directly into your checking or savings account. With just a written request, you can depend on a fixed payment, or an amount based on a fixed period of time, to be deposited on a regular basis. Please note that there may be an administrative charge for this service and there are eligibility requirements.

Overloan Protection II Rider (Form #R08OLP)12—Designed for policyowners who plan to take maximum policy loans from their policy, this rider protects the policy from lapse after rider exercise, even if the policy debt exceeds the cash value. There is a one-time charge and certain conditions must be met before a policyowner can qualify for and exercise the rider, including meeting the minimum premium requirement in the first five policy years and electing the Guideline Premium Death Benefit Qualification Test. After rider exercise, no new premiums, loans, withdrawals or benefit changes are allowed.

12 The potential tax consequences of the Overloan Protection II Rider have not specifically been ruled on by the IRS or the courts. Please consult your tax advisor for more information. Riders will likely incur additional charges and are subject to availability, restrictions and limitations. When considering a rider, request a policy illustration from your life insurance producer to see the rider’s impact on your policy’s values.

More Options for Greater Versatility

13 Riders will likely incur additional charges and are subject to availability, restrictions and limitations. When considering a rider, request a policy illustration from your life insurance producer to see the rider’s impact on your policy’s values.

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Versa-Flex PRO II-CV offers the following additional riders.13

Accidental Death Benefit Rider (Form #R84-AD)—Pays an additional benefit if the primary insured’s death is accidental, subject to certain exclusions.

Conversion Rider (Form #R06CON)—At any time during the eighth policy year, allows the policyowner to convert to any other life insurance policy that we make available for such conversions.

Disability Benefit Rider (Form #R84-DB)—A monthly disability benefit allocated to the policy’s accumulated value during the primary insured’s qualifying disability, but not beyond age 65.

Guaranteed Insurability Rider (Form #R93-GI)—An option to buy additional insurance on the primary insured’s life without proof of insurability at specified ages up to 40 years old.

Owner Waiver of Charges Rider (Form #R84-OWC)—Waives policy charges if the policyowner (who is not the primary insured) becomes totally disabled before age 60.

Payor Waiver of Charges Rider (Form #R84-PWC)—Waives policy charges on a child’s policy upon death or total disability of an adult payor.

Terminal Illness Rider14—Allows the policyowner to accelerate a portion of the death benefit if the insured is diagnosed as terminally ill (12 months or fewer to live). Benefit will be a lump sum payment up to $250,000.

Waiver of Charges Rider (Form #R84-WC)—Waives policy charges in the event of the total disability of the primary insured following a three-month qualifying period.

14 The Terminal Illness Rider (Form #R12TIU or ICC12 R12TIU—form # based on state in which policy is issued) is an Accelerated Death Benefit Rider for Terminal Illness. Benefits paid by accelerating the policy’s death benefit may or may not qualify for favorable tax treatment under Section 101(g) of the Internal Revenue Code of 1986. Tax treatment of an accelerated death benefit due to terminal illness depends on the life expectancy of the insured at the time benefits are accelerated. Receipt of accelerated death benefits may affect eligibility for public assistance programs such as Medicaid. Tax laws relating to accelerated death benefits are complex. Pacific Life cannot determine whether the benefits are taxable. Clients are advised to consult with qualified and independent legal and tax advisors for more information. The cost of exercising the rider is that the death benefit is reduced by an amount greater than the rider benefit payment itself to reflect the early payment of the death benefit. Rider benefit payments will reduce the death benefit, cash surrender value, and any policy debt. Additionally, rider benefit payments may adversely affect the benefits under other riders.

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Pacific Life—The Power to Help You Succeed

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At Pacific Life, we believe a product is more than its illustrated policy values. It’s a commitment forged with the life insurance company that issues it. When you buy a life insurance policy from us, you become a voting member of the Pacific Mutual Holding Company, so decisions made in support of our overall financial strength are also made with the policyowners’ best interests in mind. We take this commitment to our policyowners seriously, as shown in our history of passing along savings in the form of over 120 policy improvements since 1985.

Buying life insurance is a long-term commitment.

The company you choose matters.

Pacific Life Insurance CompanyNewport Beach, CA 92660

(800) 800-7681 • www.PacificLife.com

Pacific Life Insurance Company is licensed to issue insurance products in all states except New York. Product availability and features may vary by state. Insurance products and their guarantees, including optional benefits and any crediting rates, are backed by the financial

strength and claims-paying ability of the issuing insurance company. Look to the strength of the life insurance company with regard to such guarantees as these guarantees are not backed by the broker-dealer, insurance agency or their affiliates from which products are purchased. Neither these entities nor their representatives make any representation or assurance regarding the claims-paying ability of the life insurance

company.

Non-guaranteed elements are not guaranteed by definition. As such, Pacific Life Insurance Company reserves the right to change or modify any non-guaranteed element. This right to change non-guaranteed elements is not limited to a specific time or reason.

Pacific Life Insurance Company’s individual life insurance products are marketed exclusively through independent third-party life insurance producers, which may include bank affiliated entities. Some selling entities may limit availability of some optional riders based on their client’s

age and other factors. Your life insurance producer can help you determine which optional riders are available and appropriate for you.

VFPRO2-2C 15-29995-03 3/15

This material is not intended to be used, nor can it be used by any taxpayer, for the purpose of avoiding U.S. federal, state or local tax penalties. This material is written to support the promotion or marketing of the transaction(s) or matter(s) addressed by this material. Pacific Life Insurance Company, its distributors and their respective representatives

do not provide tax, accounting or legal advice. Any taxpayer should seek advice based on the taxpayer’s particular circumstances from an independent tax advisor.