42nd Annual Tax Conference

Capital Management

Peter Manley, JP Morgan Lee Christie, Sidley Austin Christine Watson, PwC, Moderator Tax Issues

• CFC Rules Make Offshore Subs Unavailable to US Parents • Tax Disincentives to Outbound Restructuring of US Business (“Inversion”) • Offshore Tax-Advantaged Structure • Tax Reform

42nd Annual Insurance Tax Conference NewCo CFC

42nd Annual Insurance Tax Conference Inversion

42nd Annual Insurance Tax Conference Offshore Advantage

42nd Annual Insurance Tax Conference Offshore Reinsurance Considerations

• FET / Income Tax Tradeoff

• Reserve Credit / Collateral • 953(d) Option

42nd Annual Insurance Tax Conference Transaction Value Creation

42nd Annual Insurance Tax Conference Transaction Value Creation

In $Millions Price to: Equity value / deal U.S. GAAP Announcement Target Acquiror Run-off Non-strategic Annuity value equity Statutory C&S May-17 Fidelity & Guaranty Life CF Corporation ✓ ✓ $1,835.0 0.96x N/A May-17 AEGON Transamerica life subsidiaries Wilton Re ✓ ✓ N/A N/A N/A Oct-16 Genworth Financial, Inc. Oceanwide Group Co. Ltd. ✓ 2,706.0 0.27x N/A Sep-15 Assurant (Employee benefits business) 940.0 NA 2.22x 1 Aug-15 Symetra Financial Corp. Sumitomo Life Insurance 3,726.9 1.19x 1.84x Jul-15 Stancorp Financial Group Meiji Yasuda 5,000.0 2.17x 4.05x

Oct-14 Aegon (Canadian life business) Wilton Re2 532.0 0.47x N/A 3 Sep-14 (Canadian business) 3,680.0 1.94x NA Jun-14 Protective Life Corp. Dai-ichi Life Insurance Co. 5,708.0 1.29x 1.86x May-14 XL Life Reinsurance (SAC) GreyCastle ✓ ✓ ✓ 570.0 0.97x NA Apr-14 Nuveen Investments TIAA 6,250.0 NA NA

Mar-14 Wilton Re Holdings Ltd. Canada Pension Plan 1,800.0 1.29x NA 4 Mar-14 Conseco Life Insurance Company Wilton Re ✓ ✓ 237.0 0.45x 1.50x 5 Feb-14 Continental Assurance Company Wilton Re ✓ ✓ 615.0 NA 1.03x 6 Sep-13 Forethought Financial Group Global Atlantic Financial Group ✓ NA NA NA 7 Jul-13 Lincoln Benefit Life Resolution Group ✓ ✓ ✓ 600.0 NA 1.83x Jun-13 Generali US life reinsurance business SCOR 750.0 NA 2.06x Apr-13 MONY Life Insurance Co. Protective ✓ 1,056.0 NA 1.70x 8 Dec-12 USA Athene ✓ ✓ 1,550.0 0.31x 0.60x 9 Dec-12 Sun Life U.S. annuity & certain life insurance businesses Guggenheim ✓ ✓ ✓ 1,350.0 0.65x 1.18x 10 Sep-12 Hartford's individual life insurance business ✓ 1,315.0 NA 1.88x 11 Jul-12 Presidential Life Athene ✓ ✓ 414.3 0.50x 1.28x 12 Jul-12 John Hancock fixed deferred annuities block RGA ✓ ✓ 350.0 NA NA May-12 SRLC America Jackson National () 663.0 NA 1.16x 13 Oct-11 EquiTrust Guggenheim ✓ ✓ 471.4 0.83x 0.95x 14 Jul-11 Investors Insurance Athene ✓ 55.0 1.58x 1.65x 15 Oct-10 Liberty Life Athene / Protective ✓ ✓ 628.0 0.86x 2.34x Sep-10 United Investors Life / Torchmark Protective 363.3 NA 2.18x 16 Aug-10 Harbinger ✓ ✓ 350.0 0.28x 0.39x Apr-10 American-Amicable Industrial Alliance ✓ 145.3 NA 1.88x 17 Feb-10 Security Benefit Corporation Guggenheim ✓ ✓ 400.0 NA NA Median $663.0 0.85x 1.70x Mean 1,511.2 0.88x 1.66x

Source: Company filings, FactSet, SNL Financial; 1 Includes special dividend of $0.50; 2 Converted to USD using 10/16/14 exchange rate of 0.89x; based on OSFI capital of $1,280.6mm; 3 Converted to USD using 9/3/14 exchange rate of 0.92x; Price of GBP2,219 based on 1.80:1x conversion rate from CAD to GBP; Based off of IFRS of GBP1,146 as of 6/30/14; 4 Based on 3/3/14 CNO press release, net assets sold of $527mm; 5 Net proceeds of $615mm, a portion of which will be received in the form of a dividend from CAC immediately prior to closing; 6 Forethought Financial Group's C&S of $509mm as of 6/30/13; 7 Lincoln Benefit C&S of $328mm as of 6/30/2013; per 7/17/13 release, would record a GAAP loss on the sale of LBL in the range of $475-525mm; 8 Based on 12/21/12 Aviva press release, transaction values Aviva USA at 0.6x 6/30/12; converted to USD using 0.9728 USD/CAD rate on 9/30/12; 9 Based on 12/17/12 Sun Life Financial presentation; net IFRS book value of business sold of C$2.15bn as of 9/30/12; converted to USD using 0.9728 USD/CAD rate on 9/30/12; Per 12/17/12 Sun Life investor presentation, multiple calculated as $1.35bn purchase price divided by $1.14bn 9/30/12 net U.S. statutory book value (defined as statutory capital plus IFRS book value of two legal entities being sold); 10 Equity value calculated as cash payment ($615mm) plus publicly indicated release of statutory capital by the company ($700mm)Excludes value associated with the recapture of business previously retroceded to AG; 11 Presidential Life’s 6/30/12 book value of $836mm and C&S of $325mm as reported in Company filings; 12 Statutory Represents $350mm RGA investment in return for $5.4 billion in invested assets; 13 EquiTrust C&S of $463mm as of 6/30/11; GAAP book value of $531mm including AOCI per 11/10/11 FBL investor presentation; 14 Represents a transaction multiple of IFRS equity; per SCOR’s 6/30/11 interim report, IFRS book value of $35mm; C&S of $33mm as of 2010 per STAT annual statement; 15 Canadian GAAP book value calculated per Note 11 of 12/2/10 RBC 40-F as $5.4bn in total assets less $4.6bn in total liabilities for implied equity value of $728mm as of 10/31/10; C&S of $268mm as of 6/30/10; 16 Per 4/6/11 Harbinger press release, C&S of $902mm as of 12/31/10; IFRS book value of £1.0bn ($1.2bn) as of 6/30/10 per Old Mutual 2010 interim report; exchange rate of 0.8105 GBP/USD; 17 $400mm purchase price includes capital injections by investor group of $175mm on 2/26/10 and $165mm on 7/30/10 42nd Annual Insurance Tax Conference Arch Capital UGC from AIG for $3.4bn

United Guaranty Overview Transaction Overview UGC is the leading private mortgage insurance On August 15, 2016, American International Group, Inc. (“AIG”) (NYSE:AIG), a leading global company in the United States with $186.4 billion of insurance organization serving customers in more than 100 countries and jurisdictions, first-lien primary mortgage insurance in force as of announced it had entered into a definitive agreement to sell its 100% interest in United June 30, 2016 Guaranty Corp. (“UGC”) to Arch Capital Group Ltd. (“Arch”) (NASDAQ:ACGL) The Company has active relationships with over The total consideration for the transaction is $3.4 billion consisting of $2.2 billion of cash, $250 1,800 customers and approximately 1,050 million of newly issued Arch perpetual preferred stock, and $975 million of newly issued Arch employees including a national sales force of convertible non-voting common-equivalent preferred stock approximately 100 professionals AIG will retain all mortgage insurance business ceded under UGC’s existing 50% quota share agreement with various AIG subsidiaries, for business originated from 2014 through 2016 The convertible non-voting common-equivalent preferred stock would convert into approximately 9% of the Arch common stock AIG has agreed to enter into an investor rights agreement with Arch which will include customary registration rights following a lock-up period Closing of the transaction is subject to required regulatory approvals The transaction maximizes value from UGC, while further streamlining AIG’s organization, and allows AIG to continue delivering on its promise to return $25 billion to its shareholders by the end of 2017

42nd Annual Insurance Tax Conference CF Corp announced the acquisition of Fidelity & Guaranty Life for $1.835 bn Fidelity & Guaranty Life Overview Transaction Overview

 Fidelity & Guaranty is a provider of primarily: fixed Acquisition of  CF Corp. to acquire 100% of the common shares of F&G for total consideration of $1.835bn indexed annuity products (71% of FY ’16 sales), multi- Fidelity & ($31.10 per share) year guaranty annuity products (27% of FY ’16 sales), and Guaranty Life  Acquisition implied P/BV (ex. AOCI) of 1.1x indexed universal life products (2% of FY ’16 sales)  CF Corp. will acquire certain reinsurance companies from HRG Group with this transaction Reinsurance  F&G has grown sales by approximately 10% annually  F&G will reinsure a significant share of its existing and new business to a newly-created Transactions from 2012-2016 amounting to $2.6bn in sales during FY affiliate company

‘16  The transaction will be financed with $1.2bn from CF Corp’s IPO and more than $700mm in Transaction equity  Headquartered in Des Moines, Iowa, F&G has ~700,000 Financing policies in force  Funds advised by Blackstone and FNF have provided a full backstop funding commitment to ensure funding  CF Corp intends to retain F&G’s strong management team and Chinh Chu and William Foley  F&G is a top 5 player in the IMO distribution channel and Management will become Co-Chairmen sells through a network of ~100 IMOs and 30,000+ and Board  The board will be comprised of independent directors contracted agents Investment  F&G will enter into an investment management agreement with affiliates of Blackstone  F&G generates income by matching stable, long-term Management  F&G’s current focus on high quality investment grade assets will be maintained under the liabilities against a high-quality investment portfolio to Agreement current team earn a net spread

42nd Annual Insurance Tax Conference CF Corp announced the acquisition of Fidelity & Guaranty Life for $1.835 bn

Seller

BDA Op Co

Reinsurance Dividend

IA Op Co

42nd Annual Insurance Tax Conference Tax Reform

• Lower Corporate Income Tax Rate

• Life Insurance Provisions

• Impact on Pricing

• Provisions Affecting Deductibility of Outbound Reinsurance Premiums ➢ Neal Bill

42nd Annual Insurance Tax Conference Tax Reform – Impact on RBC

Morgan Stanley 10/11/17 Study of US Life-Annuity Insurers • Average RBC @35% Tax Rate 492% • Average RBC @20% Tax Rate 396% • Components of 96 bps Difference ➢ DTAs 15 ➢ Asset Risk 20 ➢ Other 61

42nd Annual Insurance Tax Conference