[Type of Presentation]
MARCH 2010
Prepared For:
Prepared By:
Edit Name on Title Master
Edit Title on Title Master
Edit Name on Title Master
Edit Title on Title Master
Edit Phone on Title Master
Sun Life Financial:
ABOUT US
2
Our mission: help clients achieve lifetime security
Providing solutions across a lifespan of financial needs
Protection
Savings
Protect my
business
Protect assets
if a loved one
becomes ill
Importance
Protect
loves ones
if I die
Provide
income if
unable to
work
Retirement
Protect assets
Early
from major
retirement
health set back Pass on assets
Travel
Buy a
second
home
Buy a
home
Begin
retirement
savings (tax
advantages)
Protect savings
from market
volatility
Start a
business
Save for
education
Buy a car
20
30
40
50
60
70
80
Changing Needs (Age)
3
Global leader operating in 22 countries worldwide
United Kingdom
Ireland
Rotterdam
Berlin
London
Munich
Milan
Canada
Toronto
United States
China
Madrid
Tokyo
Bermuda
Hong Kong
Mexico City
Taipei
India
Phillippines
Singapore
Indonesia
Sao Paulo
Bueno Aires
Sun Life Financial around the world
MFS Headquarters
MFS investment and marketing/service offices
Sydney
4
Fifth largest insurer in North America
Market capitalization in billions
Manulife
MetLife
Great West
Prudential
Sun Life
Hartford
Ameriprise
Principal
Lincoln
Unum
AIG
Genworth
Industrial Alliance
Stancorp
Protective
0
5
10
15
20
25
30
35
* Bloomberg, October 30, 2009
5
Diversified mix of products and services
Sun Life Financial
Canada
U.S.
MFS
Asia
U.K.
Products and Services
• Individual Life
and Health
• Individual
Annuity
• Group Life
and Health
• Group Pension
• Mutual Funds
• Individual Life
• Mutual Funds
• Individual
Annuity
• Asset
Management
• Group Life
and Health
• Individual Life
and Health
• Group Life
and Health
• Life and
Annuity
Policies
• Group Pension
• Mutual Funds
• Asset
Management
• Asset
Management
6
Diversified sources of revenue
Percent of revenue by geography and product category
Geographic Diversification*
Business Diversification**
Asia
Corporate
MFS
7%
6%
8%
Wealth
Management
Canada
42%
40%
Protection
U.S.
60%
40%
LTM Q3 2009
* Based on LTM Q3 2009 Revenue (C$): Excludes proceeds from gain on sale of CI Financial
** Based on LTM Q3’09 VNB (C$)
7
Among the industry’s most highly rated companies
Ratings from independent industry analysts
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
1 Outlook stable.
2 Negative outlook.
As of September 31, 2009
8
Prudently invested company assets
Percentage of assets invested in different asset classes
Real Estate
Cash
5%
8%
Equities
4%
Other1
7%
Mortgages and
Corp Loans
21%
Bonds
55%
• 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)
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).
9
Disciplined investment philosophy
145 years of financial stability
Total assets under management of US:
$385 billion (as of September 30, 2009
for 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
10
How we’re communicating our financial strength
• Over 20 million customers
worldwide
• 145 years in business
• A+ credit rating
• Never taken bailout money
11
Sun Life Financial’s connection with Churchill
12
History of innovation
1971
Enters annuity
market with
variable annuity
1865
Company is
chartered
1895
Enters U.S.
market
1982
Acquires MFS
1989
2004
Introduces MFS
Regatta brand
Introduces Sun Life Financial
Masters brand
1999
2008
Introduces Earnings
Enhancement Benefit
Introduces Retirement
Income Escalator
1982
1988
2000
2007
Introduces first VA
with no upfront
sales charge
Introduces
SLF Futurity
brand
Initial Public
Offering (ticker
symbol SLF)
Introduces
Income ON
Demand
13
Risk management: general
In the U.S.:
• 8 dedicated departments
• 150+ employees
• 75 actuaries hold FSA
professional designation
• 10 CFAs
“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.
14
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
15
Ongoing de-risking of our variable annuity products
Product levers to impact risk and profitability
Optional
Death
Benefits
Fees
Compensation
Phase 1
Q1 & Q2
2009


Phase 2
Q3
2009


Phase 3
2010


Withdrawal
Benefit %
and Tiers
Initial
Equity
Allocation





Ongoing
Equity
Allocation
Step
Ups
No. of
Benefits
12


3
Q1 2010
16
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 RBC ratio as of 12/31/08:
357%
•Sun Life Assurance Company of Canada
• Minimum Continuing Capital & Surplus Requirement (MCCSR)
Sun Life RBC ratio as of 12/31/08:
Sun Life MCCSR ratio as of 9/30/09:
150%
357%
17
Best practices risk management
Best
Practices
Level of Strategic Alignment
HIGH
Strategic Planning Integration
Return Optimization
Better
Practices
Risk Management
Risk Measurement
Weak
Practices
Loss Minimization
Compliance
LOW
Loss Control
Balance Sheet
Protection
Risk / Return
Optimization
Value
Maximization
Risk Management Objective
18
Our annuity product strategy
•Product focus
•
•
•
•
Focus on core VA product
Opportunistic approach to FA
Exiting non-registered FIA
Examining market and product
extensions
•Product design changes to align
interests of shareholder, customer
& distributor
• Reduced equity exposure
• Reduced benefits/increased fees
in line with competition
• Reduced compensation
•Simplified VA product portfolio
• Reduced number of living and death
benefits from 12 to 3
Result: Current product improves profitability and has reduced the capital at risk
19
Well capitalized: MCCSR Ratio
MCCSR Ratio
2005
2006
2007
407%
339%
358%
232%
213%
404%
222%
RBC Ratio
216%
238%
2004
2008
300-350%
Note: MCCSR applies to all Sun Life, while RBC applies to Sun Life U.S. only (approx 20% of total capital base)
Represents the MCCSR ratio of Sun Life Assurance Company of Canada
and the RBC ratio of Sun Life Assurance Company of Canada (U.S.).
20
About Sun Life Financial
BUSINESS OVERVIEW
21
Solid foundation for sustainable growth
•Drive focus, build scale and simplify
Markets
Products
Distribution
Operations and Culture
Financial and Risk Management
The market potential for each business will drive
our actions
Develop focused portfolio to meet evolving distribution
and customer needs and deliver shareholder value
Expand distribution capacity and capability
Anticipate and efficiently service customer needs
through a high performance culture
Ensure growth is profitable and sustainable
Leverage risk management as a core discipline
22
2009 revenue by business unit
Percentage of revenues by business line
Employee
Benefits Group
21%
Individuals
Annuities
50%
29%
23
Aligning markets, products and distribution
Business and Product Lines
Annuities
• Variable Annuities
EBG
Life
• Core Universal Life
• M Financial
Marketing
Wholesale Distribution (SLFD/EBG) Strategic Partnerships
Wirehouses
Regional
Independent
Firms
Banks
Broker
General
Agents
Brokers
Consultants
Consumer
24
About Sun Life Financial
BRAND
25
Increasing brand awareness
9
26
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
27
Media focus on thought leadership
Consumers
Financial Intermediaries
28
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
29
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!
30
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
31
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
32
Quality awards
2008, 2007, 2006, 2005
Award for Financial
Intermediary
Post-Sale Service
1st out of 18 VA Providers
2006 Study of Bank and
Brokerage Retail Investment Services
3rd out of 16 providers
Operations Managers’ Roundtable
2008 Ranking of annuity insurance carriers’
back-office service
33
About Sun Life Financial
LEADERSHIP
34
SLF leadership: presidents
35
About Sun Life: biographies
•Westley V. Thompson
President
Sun 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.
36
About Sun Life: biographies
•Terry Mullen
President, 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).
37
About Sun Life: biographies
•Priscilla S. Brown
Senior Vice President, Head of Marketing
Sun 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.
38
About Sun Life: biographies
•Janet V. Whitehouse
Senior Vice President and General Manager, Individual Life Insurance
Sun 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.
39
About Sun Life: biographies
•Daniel O’Shea
Senior Vice President, Individual Life Sales
Sun 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.
40
About Sun Life: biographies
•Gregory Smith
Senior Vice President, Affiliated Channel
Sun 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.
41