AQR Dynamiq Allocation Indexsm

AQR DynamiQ Allocation Index SM Frequently Asked Questions

The AQR DynamiQ Allocation IndexSM (the “Index”) harnesses the same underlying investment research and expertise that have elevated AQR as a leader in the quantitative investment industry. The Index utilizes a multi-style and systematic rules-based methodology that:

• Diversifies globally1 within two major asset classes providing exposure to 15 major markets based on their individual attractiveness • Dynamically adjusts the mix of assets underlying the Index in an effort to achieve optimal results • Actively adjusts risk2 in seeking to deliver consistent returns through a variety of market environments

The AQR DynamiQ Allocation IndexSM has been designed by AQR Indices, LLC, a subsidiary of AQR Capital Management, LLC, for exclusive use in The Power Series of Index Annuities®, issued by American General Life Insurance Company (AGL).

Additional information and performance results for the AQR DynamiQ Allocation IndexSM can be found at www.aqr.com/Index.

Contact your AIG representative or call our Sales Desk at 888-438-6933, Option 2 to learn more.

1Diversification and risk management strategies do not guarantee positive performance or prevent negative returns. International stocks and bonds involve special risks, such as currency fluctuations, differing financial reporting and regulatory standards, and economic and political instability. These risks are highlighted when securities are from emerging markets. 2There are no assurances that any objective will be achieved. For financial professional or agent use only. Not for use with the public. AQR | FAQ

1. Who is AQR Capital Management? Over the last 22 years, AQR has established its position not only as one of the most reputable research institutions in the world, but as a leader in the quantitative investment space. They leverage the findings from their highly respected research teams to construct portfolios for a variety of clients, ranging from individual investors to some of the largest and sophisticated investors in the world.

AQR manages a diverse set of investment strategies rooted in the core philosophy that well-known drivers of performance, known as factors or styles, can be utilized to construct better, more efficient portfolios.

With $143 billion in assets under management (as of 3/31/2020), over 800 employees across the globe, including approximately 70 PhDs and 20 current and former professors, AQR manages money for some of the largest pensions, endowments, and sovereign wealth funds worldwide.

In June 2020, AQR launched AQR Indices, LLC, an affiliated index provider, which created the AQR DynamiQ Allocation IndexSM.

A few of AQR’s achievements:

Academic Engagement Awards and Prizes

• Nearly half of employees hold 60 Research Awards advanced degrees • Approximately 20 current and former Notable awards include: professors work at AQR • 10 Bernstein Fabozzi • AQR Asset Management Institute at Journal of Portfolio London Business School established Management Awards to promote excellence in asset • 9 Graham & Dodd Awards management • 6 Smith Breeden Awards • AQR Insight Award: annual $100,000 • 4 Dimensional Fund prize honoring unpublished papers Advisors Prizes that provide the most signigicant investment insights • 1 Fischer Black Prize • Online research library with more than • 1 Bernacer Prize 300 AQR papers, journal articles, • 1 Markowitz Journal of books and periodicals, as well as our Investment Management Award data sets

As of 3/31/2020. Source: AQR, SSRN and Google Scholar. Graham & Dodd Awards won in 2018, 2015, 2011, 2005, 2004, 2003, 2000, 1998, 1991; Bernstein Fabozzi Awards won in 2020, 2018, 2015, 2014, 2013, 2012, 2005, 2004, 2003; Smith Breeden Awards won in 2010, 2008, 2002, 2000, 1998; DFA Awards won in 2016, 2014, 2008, 2005; Michael Brennan Awards won in 2014, 2013, 2005 and 2004; Fischer Black Prize won in 2007; Bernacer Prize won in 2011; Markowitz Award won in 2015. Three Smith Breeden awards were second place mentions; two DFA awards were second place mentions; one Michael Brennan award was a second place mention.

1Source: AQR. All figures approximate as of 3/31/2020; AUM includes assets managed by AQR and its advisory affiliates. Includes current and former professors. For financial professional or agent use only. Not for use with the public. AQR | FAQ

2. What is the inception date of the Index? The inception date of the Index is May 18, 2020.

3. Is the Index discretionary or rules-based? The Index uses a systematic, rules-based methodology incorporating five key styles (also known as factors): Value, Momentum, Carry, Defensive, and Trend. The first four determine positioning within each asset class, while Trend determines the overall exposure between equity and fixed income.

4. What are the underlying markets within the AQR DynamiQ Allocation IndexSM? The Index has the flexibility to allocate across 9 geographical regions for the equity portion and 6 geographical regions for the fixed income portion of the Index. The Index will adjust allocations to the regions on a monthly basis, based on relative attractiveness measured by four factors: Value, Momentum, Carry, and Defensive.

Equities Fixed Income Australia Sweden Australia Canada Switzerland Canada Europe United Kingdom Germany Hong Kong United States Japan Japan United Kingdom United States

AQR DynamiQ Allocation IndexSM Combines Five Distinct Styles to Help Enhance Performance

Style Fundamental Theme

Value Relatively cheap assets tend to outperform relatively expensive ones.

An asset’s recent relative performance tends to continue in the near Momentum future. This style focuses on long-term price changes.

Higher-yielding fixed income assets tend to provide higher returns than Carry lower-yielding fixed income assets.

Lower-risk and higher-quality equities tend to generate higher risk- Defensive adjusted returns.

For financial professional or agent use only. Not for use with the public. AQR | FAQ

5. Why does the index use a combination of 5 styles and what impact does that have on the expected performance of the Index? By combining 5 well-researched styles - Value, Momentum, Carry, Defensive and Trend—the AQR DynamiQ Allocation IndexSM is designed to harness the diversification potential of each. The result can be an overall index that is less sensitive to economic shocks and delivers a smoother, less volatile ride over the long term. When looking at almost 100 years of data, as illustrated in the below chart, a multi-style approach performs better than any one individual factor on its own. This is due to the fact that each factor has positive expected returns, and low or negative correlation between one another.

A Multi-Style Approach Has Historically Provided Higher, More Consistent Returns Over Time Hypothetical Average Annual Returns, 1926-2019

Full 1926-29 1930-39 1940-49 1950-59 1960-69 1970-79 1980-89 1990-99 2000-09 2010-19 Period

Trend Trend Trend Trend Multi-Style Multi-Style Multi-Style Multi-Style Trend Defensive Multi-Style 22.7% 11.7% 14.8% 20.7% 13.5% 8.5% 18.7% 11.3% 7. 4% 3.5% 11.2%

Multi-Style Multi-Style Multi-Style Multi-Style Trend Trend Defensive Momentum Multi-Style Trend Trend 13.7% 11.2% 12.4% 16.7% 9.7% 7.9 % 13.3% 10.4% 7.0% 1.7% 10.4%

Defensive Defensive Defensive Momentum Value Momentum Momentum Carry Defensive Momentum Momentum 10.3% 9.9% 7. 3% 9.5% 8.8% 7.1% 10.5% 7.8% 5.8% 0.5% 5.6%

Momentum Value Momentum Defensive Carry Carry Trend Trend Value Multi-Style Defensive 6.8% 6.1% 6.5% 7.0% 6.3% 5.8% 8.5% 6.1% 2.2% 0.2% 5.1%

Value Momentum Value Carry Defensive Value Value Value Momentum Value Value -2.5% 0.5% 4.8% 6.7% 5.4% 5.1% 7. 5% 4.9% 2.0% -1.7% 3.6%

Carry Carry Carry Value Momentum Defensive Carry Defensive Carry Carry Carry -3.3% -0.1% -3.3% -3.1% 2.7% -5.8% 4.9% -2.9% -0.2% -3.3% 2.5%

Value Momentum Carry Defensive Trend Multi-Style

Note: Past performance is not indicative of future results. Source: AQR. This hypothetical example is for illustrative purposes only. It is intended to show the diverse performance of the individual styles used in the Index from 1926 through 2019. It does not reflect the performance of any specific investment or portfolio that AQR manages. The underlying data for the Value, Momentum, Carry, Defensive, Trend and Multi-Style factors is derived from data taken from Ilmanen, Israel, Moskowitz, Thapar & Wang (2019), “Do Factor Premia Vary Over Time? A Century of Evidence.” The full sample period starts 1/1/1926 and ends 12/31/2019. All returns are scaled to 12% volatility, gross of fees and transaction costs.

For financial professional or agent use only. Not for use with the public. AQR | FAQ

6. What is the difference between “Momentum” and “Trend” and their impact in determining the Index’s allocation? Momentum is used to measure the relative price trends between geographical regions or assets, and uses longer-term price trends, typically 12 months. For example, when comparing geographical regions, say Canada and Japan, Momentum looks at the 12-month price movements between the two to determine which region has better price momentum, therefore increasing that region’s attractiveness. Momentum is utilized when determining the regional weights in each asset class.

Trend uses shorter term price movements, typically 3 months, to determine the tactical allocation to equity and fixed income. See the chart below for an example as to how price trends can affect the allocation to each asset class.

Equity Prices Fixed Income Prices More Equities More Fixed Income Trending Up = Trending Up = Shift Allocation Both Asset Classes More Equities & Both Asset Classes Less Equities & Trending Up = More Fixed Income Trending Down = Less Fixed Income

Allocations are subject to change. Note: Diversification and risk management strategies do not guarantee positive performance or prevent negative returns. There are no assurances that any objectives will be achieved.

AQR has conducted extensive research on both Momentum and Trend, which shows each factor has historically delivered positive, long-term performance.

7. What is the target volatility level for the Index and how does it work? The Index targets a volatility of 5%. The total exposure to equities and fixed income is scaled systematically on a daily basis to control risk.

For financial professional or agent use only. Not for use with the public. AQR | FAQ

8. How is risk controlled within the Index? The Index utilizes daily risk controls to seek the desired volatility level of 5%. This is implemented by adjusting the overall exposure to equities and fixed income markets. It can be expected that an increase in volatility in either asset class could result in lower total exposure to that asset class. See the graph below for the Index’s hypothetical weightings to each asset class since 2005.

Equity and Fixed Income Exposure Is Actively Adjusted to Potentially Boost Returns or Reduce Risk Hypothetical Exposures, January 1, 2005 - December 31, 2019

In down markets such as 2008-2009, In up markets like 2019, total exposure exposure is reduced. may increase to over 100%.

190 180180 160160 140140 120120 100100 Percentage 8080 6060 4040 2020 0 0 12/05 12/07 12/09 12/11 12/13 12/15 12/17 12/19

Equity Exposure Fixed Income Exposure Total Exposure

Note: Past performance is not indicative of future results. Source: AQR. This hypothetical example is for illustrative purposes only. It is intended to show the asset class weights of the Index, if it had existed from 1/1/05–12/31/19. The Index was created on 5/18/20. Levels for the Index before 5/18/20 represent hypothetical data determined by retroactive application of a back-tested model, itself designed with the benefit of hindsight. The above chart does not reflect the performance of any specific investment or portfolio that AQR manages. Individuals cannot invest directly in an index or the market. Specific exposures and asset classes are subject to change at any time without notice.

For financial professional or agent use only. Not for use with the public. AQR | FAQ

9. What is a backtest? Why is it important in constructing an index? Back-testing provides insight into how an index would have performed over a specified time period, prior to the inception date of the index. It is an important tool that allows us to illustrate how the Index would have performed throughout different historical market environments.

While the backtest of the Index only covers the span of the last 15 years, much of the research conducted by AQR which goes into the development and application of the factors utilized in the Index goes back decades, and in some cases over a century. Past performance is not indicative of future results.

Adding Global Diversification Across Styles May Smooth Out Returns and Increase the Likelihood of Achieving Long-Term Goals Hypothetical AQR DynamiQ Allocation IndexSM Performance, January 1, 2005–December 31, 2019

300300 S&P 500® 250250 (Without Dividends)

200 200 AQR DynamiQ Allocation IndexSM 150150 Index Value 100100

5050

00 12/05 12/07 12/09 12/11 12/13 12/15 12/17 12/19

Note: Past performance is not indicative of future results. Sources: AQR, Bloomberg. This hypothetical example is for illustrative purposes only. It is intended to show the performance of the AQR DynamiQ Allocation IndexSM versus the S&P 500® Index (without dividends) if the Index had existed from 1/1/05–12/31/19. The Index was created on 5/18/20. Levels for the Index before 5/18/20 represent hypothetical data determined by retroactive application of a back-tested model, itself designed with the benefit of hindsight. Returns for the AQR DynamiQ Allocation IndexSM are net of an annual fee. If dividends were included for the S&P 500® Index, the returns would have been less volatile. The above chart does not reflect the amount of interest credited to an index annuity during this time period. Actual results for a specific insurance contract would depend on the crediting strategy chosen and the index rate cap, spread and/or participation rate for the time period(s) shown. Individuals cannot invest directly in an index or the market.

For financial professional or agent use only. Not for use with the public. AQR | FAQ

10. Where can daily values be viewed? Daily pricing, and additional information on the AQR DynamiQ Allocation IndexSM, can be viewed at www.AQR.com/Index.

11. How often does the Index rebalance? Regional and asset class exposures are rebalanced on a monthly basis, while overall index exposures are adjusted on a daily basis to maintain a volatility target of 5%.

12. Is there an embedded fee for this Index? Yes, the embedded fee is 50 bps annually.

For financial professional or agent use only. Not for use with the public. Disclosures Stocks and bonds are subject to risks, including the possible loss of principal. International stocks that provide exposure to foreign markets involve special risks, such as currency fluctuations, differing financial reporting and regulatory standards, and economic and political instability. These risks are highlighted when stocks are from emerging markets. Index Definition The S&P 500® Index is a market-capitalization-weighted index of the 500 largest U.S. publicly traded companies. The index is widely regarded as the best gauge of large-cap U.S. equities. The S&P 500® is a price return index and does not include the impact of dividends. Index Methodology The AQR DynamiQ Allocation IndexSM (the “Index”) is a long only index providing exposure to futures on third-party equity indices primarily comprised of large- cap securities of U.S. and non-U.S. issuers from developed markets, and exposure to futures on U.S. and non-U.S. developed government fixed income securities. The Index will target an average of 40% equity and 60% fixed income weighting over the long-term. The exposures of the Index to equity and fixed income will vary based on a rules-based methodology that allocates to equity and fixed income based on several well-known investment styles, with the potential for substantially different weightings from the 40/60 target depending on both market conditions and the attractiveness of each asset according to signals within the Index methodology. Back-Test Information on Multi-Style Approach Chart AQR back-tests of Value, Momentum, Carry, Defensive, Trend, and Multi-Style theoretical long/short style components are based on monthly returns, undiscounted, gross of fees and transaction costs, excess of a cash rate proxied by the Merrill Lynch 3-Month T-Bill Index, and scaled to 12% annualized volatility. Each strategy is designed to take long positions in the assets with the strongest style attributes and short positions in the assets with the weakest style attributes, while seeking to ensure the portfolio is market-neutral. The Style and Asset Group Composites, are based on an allocation to the style components and asset group components based on their liquidity and breadth. The components are then allocated with roughly equal weighting to each of the styles within an asset group (as not all four styles are present in each asset group). Stock and Industry Selection: approximately 2,000 stocks across Europe, Japan, and U.S. Country Equity Indices: Australia, Canada, Eurozone, Hong Kong, Japan, Sweden, Switzerland, U.K., and U.S. Within Europe: Italy, France, Germany, Netherlands, and Spain. Bond Futures: Australia, Canada, Germany, Japan, U.K., and U.S. Currencies: Australia, Canada, Euro, Japan, New Zealand, Norway, Sweden, Switzerland, U.K., and U.S. “AQR” and the AQR DynamiQ Allocation Index are trademarks or service marks of AQR Capital Management, LLC or one of its affiliates (collectively, “AQR”) and have been licensed for use by American General Life Insurance Company (the “Company”) for use as a benchmark for an annuity (inclusive of all applicable riders, the “Product”). The Product is not sponsored, endorsed, sold or promoted by AQR, its affiliates, nor the calculation agent, and they do not provide any investment advice to the Company with respect to the Product or to owners of the Product, nor do they make any representation regarding the advisability of investing in the Product or obtaining exposure to the Index. The Index is constructed without regard to the investment needs or suitability of the Company, the Product, or any Product owners. AQR and the Index’s calculation agent have no obligation or liability whatsoever with respect to, and make no representations regarding, the Product. AQR makes no representation regarding the ability of the Index to achieve its goals and disclaims all express or implied warranties, including any warranty of merchantability and fitness for a particular purpose or use, in connection with the Index, including, without limitation, any results to be obtained by tracking the Index. Neither AQR nor the Index’s Calculation Agent guarantees the accuracy or completeness of the Index. NONE OF AQR OR ITS AFFILIATES SHALL HAVE ANY LIABILITY FOR ANY ERRORS, OMISSION OR INTERRUPTIONS OF OR IN CONNECTION WITH THE INDEX OR ANY DATA INCLUDED THEREIN OR FOR THE PRODUCT. The Index is independently calculated by a third-party calculation agent. The AQR DynamiQ Allocation Index methodology adjusts exposures to achieve a volatility target. It is possible that the index could realize a volatility greater or less than its target. Hypothetical and simulated examples have many inherent limitations and are generally prepared with the benefit of hindsight. There are frequently sharp differences between simulated results and the actual results. There are numerous factors related to the markets in general or the implementation of any specific investment strategy, which cannot be fully accounted for in the preparation of simulated results and all of which can adversely affect actual results. No representation is being made that any account, product, or strategy will or is likely to achieve profits, losses, or results similar to those shown. The AQR DynamiQ Allocation IndexSM (the “Index”) embeds an annual index cost in the calculations of the change in index value. This embedded index cost will reduce any change in index value, and it funds certain operational and licensing costs for the Index. Since it will affect the return of the Index, it may also impact the amount of interest credited to an index annuity; however, it is not a fee paid by the policy owner or received by the issuing insurance company. Individuals cannot invest directly in an index. This material and its contents have been provided to you solely for informational purposes and does not constitute an offer or solicitation of an offer or any advice or recommendation to purchase any securities or other financial instruments and may not be construed as such. Any use of the information or data for commercial purposes or design of products is prohibited without the prior written consent of an authorized person of AQR. The Power Series of Index Annuities are issued by American General Life Insurance Company (AGL), 2727-A Allen Parkway, Houston, Texas 77019. Contract Numbers for the Power Series of Index Annuities: AG-800 (12/12) and AG-801 (12/12). AGL is a member of American International Group, Inc. (AIG). The underwriting risks, financial and contractual obligations and support functionsassociated with the annuities and policies issued by AGL are its responsibility. AGL does not issue products in the state of New York. Contracts, policies and riders may vary by state and are not available in all states.

I6063FAQ (7/20)