Mastering your

indexed UL sales:

Indexed UL basics
(For New IUL Sellers)
Insurance products are issued by: John Hancock Life Insurance Company (U.S.A.), Boston, MA 02116 (not licensed in New York) and John
Hancock Life Insurance Company of New York, Valhalla, NY 10595.
LIFE-9593 10/21 For Agent Use Only. This material may not be used with the public.
What is Similar features to traditional universal life except IUL
Indexed UL? offers:

Growth Protection Choices

Opportunity to earn Guaranteed stated floor Select Fixed Account
interest linked to the or Indexed Account
performance of a options that match
financial index
your clients financial
goals and objectives

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How does it Indexed UL is similar to
differ from traditional UL, because:
UL/VUL? It is a general account product just
like traditional UL
IUL typically offers a fixed
account rate just like
traditional UL
The company’s general account
yield is used to support this
declared rate
The general account yield also
supports an “options budget”
which funds index account
parameters (cap and floor)
Indexed UL is not like
VUL, because:
Client does not invest in
separate accounts with direct
equity exposure
The client does not have the
same upside or downside
potential (i.e., the upside is
capped and the downside has a
floor)
Cap and floor are determined by
the aforementioned "options
budget," supported by the
company's general account yield
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Where does it
• Typically min
fit? guaranteed rates
UL • Limited cash value VUL
volatility

IUL

• Stated floor guaranteed

• Greater upside potential UL

PERFORMANCE
IUL than UL, less upside
potential (and fewer IUL
options) than VUL

TIME
VUL
• Potential for negative
returns
VUL • Greater upside potential
than UL or IUL

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Key Segment: A portion of the Policy Value that is allocated to an indexed account.
It dictates the portion of policy value that is exposed to the equity market.
Indexed UL Typically, each segment has a duration of one year.
definitions
Segment Growth Rate: Percentage change of the referenced index (e.g.
you should S&P500)
know
Cap Rate: The maximum annual Segment Growth Rate for an Indexed
Account

Floor: The minimum annual Segment Growth Rate for an Indexed Account

Participation Rate: The percentage of the change in the index value that will
be recognized when calculating the Segment Growth Rate

Threshold Rate: Rate that must be exceeded on uncapped accounts before

credit is given*

*May not be applicable to all IUL products.

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What is an
examples of a
financial index?
Widely regarded as the best single benchmark of the U.S.
market, the S&P 500 Index includes 500 large cap
common stocks actively traded in the United States.

Standard & Poor’s®, S&P®, S&P 500®, Standard & Poor’s 500 and 500 are trademarks of Standard and Poor’s Financial Services LLC, a subsidiary of The McGraw-Hill Companies,
Inc. John Hancock has been licensed to use the trademarks of S&P Index. Products are not sponsored, endorsed, sold or promoted by the licensors of the indices and they make no
representation regarding the advisability of purchasing of products. You cannot invest directly in the Indices.

For Agent Use Only. This material may not be used with the public. 6 of 20
How Indexed
UL works
Tax-free retirement
distributions
(via loans & withdrawals)

Help fund education or other

expenses
(via loans & withdrawals)

Client pays premiums Client allocates Tax-Deferred

into their IUL policy those premium Cash Value
across Indexed Accumulation Income tax-free death
Accounts and a benefits to your heirs
Fixed Account

Life insurance death benefit proceeds are generally excludable from the beneficiary’s gross income for income tax purposes. Comments on taxation are based on John Hancock’s
understanding of current tax law, which is subject to change. Prospective purchasers should consult their professional tax advisor for details.
Loans and withdrawals may reduce the death benefit, cash surrender value, and may cause the policy to lapse. Lapse or surrender of a policy with a loan may cause the recognition of
taxable income. Policies classified as modified endowment contracts may be subject to tax when a loan or withdrawal is made. A federal tax penalty of 10% may also apply if the loan or
withdrawal is taken prior to age 59 1/2.
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What you need
to know about
the fixed
account
Provides Reduces Fewer
Serves as a safety, now or volatility restrictions than
“Holding Account” in the future Indexed
for Indexed Accounts
Account options
(money earns Fixed
Account interest before
being allocated to the
Indexed Accounts)

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What you
need to know
about IUL • Cash value growth within an IUL is tied to the performance of an underlying
index (e.g. S&P 500®)
Interest
• In an environment without a cap or a floor, a financial index (e.g. S&P500) can
Crediting be volatile. It can go up or down significantly in a given year

• However, with the cap and floor mechanics within an IUL, we can restrict the
how the underlying index can impact the ultimate interest credit.
• Because cap is usually set at some positive number and floor is typically set at
zero, IUL accounts share in index’s upside and none of the down ones
• Interest crediting strategies vary based upon: Participation Rate, Cap Rate,
Indices (e.g. an equity index and a bond index)

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Simple Here are a few hypothetical examples showcasing how interest credits are determined
and how they would change under different market conditions.
demonstration
of Interest Example 1 Example 2 Example 3
Index Change (5%) X Interest Crediting Rate = Interest Crediting Rate =
Crediting Participation Rate (110%) = 5.5% Cap Rate (13%) Floor Rate (1%)

20%
15% 20%
Positive Index Change
10%
X 13%
5%
Participation Rate 5% 5.5% 1%
0%
-5%
Indexed Interest Credit
-10%
-15%
-20%
-20%

Market performance Indexed account performance Cap Rate (13%)

The purpose of the figures shown is to illustrate how the performance of the underlying referenced index could affect the annual crediting rate for the segment. The examples assume a
hypothetical rate of return, interest crediting rate, cap and floor. This example may not be used to project or predict investment results.

For Agent Use Only. This material may not be used with the public. 10 of 20
Putting it
all together

Determining
fixed account
credits Helps determine
Portfolio
yield crediting rate

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Putting it
all together

Determining caps

Portfolio Helps determine

yield caps

Cost of options

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Putting it
all together

Determining
higher caps/
multipliers Helps determine
Portfolio
yield higher caps/multipliers

Additional Cost of
policy charges options

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John Hancock Base/Select Capped

Indexed Enhanced Capped Account Capped Indexed Account Indexed Account Base Capped Two Year

Account
Guaranteed Guaranteed Guaranteed Guaranteed
Product Cap Rate Multiplier Cap Rate Multiplier Cap Rate Multiplier Cap Rate Multiplier

parameters
Accumulation IUL
9.75% 106% 9.00% 45% 8.50% 5% 21.00% N/A
Protection IUL
by product
N/A N/A 8.00% 65% 10.25% 5% 24.00% N/A
Protection SIUL
N/A N/A 8.00% 65% 11.00% N/A N/A N/A

Enhanced High Capped High Capped Base High Par Indexed

Account Indexed Account High Par Indexed Account Account
Guaranteed Guaranteed Guaranteed Guaranteed
Product Cap Rate Multiplier Cap Rate Multiplier Cap Rate Multiplier Cap Rate Multiplier

Accumulation IUL
12.00% 80% 10.50% 30% 7.50% 45% N/A N/A
Protection IUL
N/A N/A 10.50% 38% 7.00% 65% 8.50% N/A
Protection SIUL
N/A N/A 10.50% 38% 7.00% 65% 8.50% N/A

Current Participation Rate for all High Par Capped Indexed Accounts is 160%. Enhanced accounts carry an additional 3% guaranteed Index Performance Charge. N/A indicates account or
multiplier is not available on this product; Rates vary for NY products. Information is current as of October 2021.
Guaranteed product features are dependent upon minimum premium requirements and the claims-paying ability of the issuer.

For Agent Use Only. This material may not be used with the public. 14 of 20
John Hancock
Indexed
Account Barclays Global MA Classic
parameters Barclays Global MA Bonus Rate Rate

by product Product Participation Rate

Guaranteed
Bonus
Participation
Rate
Guaranteed
Bonus

Managed Accumulation IUL

100% 0.65% 125% N/A

Volatility Index
Protection IUL
N/A N/A N/A N/A
Protection SIUL
N/A N/A N/A N/A

Current Participation Rate for all High Par Capped Indexed Accounts is 160%. Enhanced accounts carry an additional 3% guaranteed Index Performance Charge. N/A indicates account or
multiplier is not available on this product; Rates vary for NY products. Information is current as of October 2021.
Guaranteed product features are dependent upon minimum premium requirements and the claims-paying ability of the issuer.

For Agent Use Only. This material may not be used with the public. 15 of 20
Products that By offering distinct indexed accounts, sample policy design gives clients
the freedom to change their allocations as their needs change over time.
change with
your clients 2020 2040 2060
Accumulating cash Nearing retirement Ensuring a legacy

20% 20% 20%

Age 45 Age 65 Age 85

20% 60%

80% 80%

Capped Indexed Account Barclays Global MA Bonus/Classic

High Capped Indexed Account Fixed Indexed Account

The figures used in this case study are hypothetical and for discussion purposes only. A client would need to determine which type of life
insurance product and which index accounts are most suitable for their specific needs.

For Agent Use Only. This material may not be used with the public. 16 of 20
Historical
examples • This example shows how actual S&P
500 returns would have impacted the
interest credited to a policy
• In years where the S&P positive, the
credit is linked to the return for that
index
• In years where they are negative, the
interest credit is 0%
• The Segment Growth Rate presented
do not include any multipliers that are
offered with the indexed accounts

Past performance is not indicative of future results. This example demonstrates what would have been credited with Accumulation IUL ’21r’s current caps, and participation rates as of October
2021. Any new premiums designated to an Indexed Account(s) form new Segments on the 15th of each month and each has a one-year term. New premiums are subject to a Lock In Date of three
business days. The current Participation and Cap Rates can be changed by the insurer and are subject to the guaranteed levels stated in the policy. Source: S&P 500 Index data from 12/14/00 –
12/14/20.

For Agent Use Only. This material may not be used with the public. 17 of 20
Accessing Index loan
policy cash Standard loan or participating loan

value In the first 10 years, borrowed Funds stay linked to indexed

funds are charged an interest account and are charged an
rate less a spread. interest rate (could be a fixed
or variable charge).
Typically zero-net cost loan years
11+ (same rate charged and This creates more risk, as net loan
credited). charge could vary from year to
year depending on return of the
index.

Index loans are available after the third policy year on John Hancock IUL products. The cost of an index loan can vary substantially compared to that of a standard loan and the risk
of policy lapse is greater than it would be with a standard loan. See the policy illustration and “Understanding Potential Loan Costs” for further details.
Index loan requests in excess of the Indexed Appreciation Account will be secured by balances transferred from the Fixed Account to a Loan Account.

For Agent Use Only. This material may not be used with the public. 18 of 20
IUL practices
to watch For

Weaker Fixed Holding Account Multi-year Applying interest

Account performance rate lower than segments credits to end-of-
Fixed Account year segment
value

For Agent Use Only. This material may not be used with the public. 19 of 20
The John
Hancock
advantage

Customize the policy with unique living benefit riders to provide

more value and differentiate yourself
State-of-the art Illustration software:  www.jhillustrator.com
E-tool and calculators: John Hancock Needs Analysis Calculator a
Interactive Rate Calculator (coming soon!).
Comprehensive marketing materials
Go to new “JH IUL Academy” at
JHSaleshub.com/IUL to get started today!
For Agent Use Only. This material may not be used with the public. 20 of 20
Standard loan requests in excess of the Fixed Account balance can be taken from the Indexed Accounts. Amounts borrowed from the Indexed Accounts will be transferred to the Loan Account at Segment maturity. See the policy contract
for more information. Index loans and Fixed Index Loans are available after the third policy year. Both Index loan and Fixed Index Loan requests in excess of the Index Appreciation Account will be secured by balances transferred from
the Fixed Account to a Loan Account.  The cost of an index loan can vary substantially compared to that of a standard loan and the risk of policy lapse is greater than it would be with a standard loan. See the policy illustration and
“Understanding Potential Loan Costs” for further details.

Insurance policies and/or associated riders and features may not be available in all states. Some riders may have additional fees and expenses associated with them.

Standard & Poor’s®, S&P®, S&P 500®, Standard & Poor’s 500 and 500 are trademarks of Standard and Poor’s Financial Services LLC, a subsidiary of The McGraw-Hill Companies, Inc. John Hancock has been licensed to use the
trademarks of S&P  Index. Products are not sponsored, endorsed, sold or promoted by the licensors of the indices and they make no representation regarding the advisability of purchasing products. You cannot invest directly in the
Indices.

Loans and withdrawals will reduce the death benefit and the cash surrender value, and may cause the policy to lapse. Lapse or surrender of a policy with a loan may cause the recognition of taxable income. Withdrawals in excess of the
cost basis (premiums paid) will be subject to tax and certain withdrawals within the first 15 years may be subject to recapture tax. Additionally, policies classified as Modified Endowment Contracts may be subject to tax when a loan or
withdrawal is made. A federal tax penalty of 10% may also apply if the loan or withdrawal is taken prior to age 59½. Cash value available for loans and withdrawals may be more or less than originally invested. Withdrawals are available
after the first policy year.

The Index Account options may not be available on all products or in all jurisdictions. [The Base Index Account options (Base Capped Index Account and Base High Par Indexed Account) are the only index account options available for
policies issued in New York for PIUL’20.] [For AIUL’21R policies issued in New York, the Base Index Account options (Base Capped Index Account and Base Capped Two Year Indexed Account) are the only index account options
available.] Please consult each product’s producer guide for index account option availability.

Neither Barclays Bank PLC ('BB PLC'') nor any of its affiliates (collectively 'Barclays') is the issuer or producer of the John Hancock Life Insurance Company (U.S.A.)’s (the “Company” or the “Issuer”) life insurance products (the
“Products”) and Barclays has no responsibilities, obligations or duties to purchasers of the Products. The Barclays Global MA Index (the “Index”) together with any Barclays indices that are components of the Index, is a trademark
owned by Barclays and, together with any component indices and index data, is licensed for use by the Company as the issuer or producer of the Products.  

Barclays’ only relationship with the Issuer in respect of the Index is the licensing of the Index, which is administered, compiled and published by BB PLC in its role as the index sponsor (the “Index Sponsor”) without regard to the Issuer
or the Products or purchasers of the Products. Additionally, the Company as issuer or producer of the Products may for itself execute transaction(s) with Barclays in or relating to the Index in connection with the Products. Purchasers
acquire the Products from the Company and purchasers neither acquire any interest in the Index nor enter into any relationship of any kind whatsoever with Barclays upon purchase of the Products. The Products are not sponsored,
endorsed, sold or promoted by Barclays and Barclays makes no representation regarding the advisability of the Products or use of the Index or any data included therein. Barclays shall not be liable in any way to the Issuer, Product
purchaser or to other third parties in respect of the use or accuracy of the Index or any data included therein.

Protection IUL & Protection SIUL are not available in New York.

Guaranteed product features are dependent upon minimum premium requirements and the claims-paying ability of the issuer.

Insurance products are issued by John Hancock Life Insurance Company (U.S.A.), Boston, MA 02210 (not licensed in New York) and John Hancock Life Insurance Company of New York, Valhalla, NY 10595.

MLINY100121983-1

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