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Transforming Retirement Savings
May 2016
Problem: The State of U.S. Retirement Savings = Dismal
Headlines sound the alarm that saving for retirement in the United States is getting harder
75% of Americans arrive at retirement with less than $28,000 – in part due to divorce
31% of America’s full-time employed work force has no retirement savings or pension plan
Over a lifetime, hidden fees in 401ks can cost a median-income two-earner family nearly
nearly one-third of their investment returns, and divorce will blindside many, resulting in an
average loss of three-quarters of their total net worth.
Social Security will run a cumulative cash deficit of $2.8 trillion between now & 2034
People want alternatives
to the risk and limitations
embedded in defined
contribution plans
(401ks/IRAs)
Some employers are turning to Cash
Balance (Defined Benefit) Plans but they’re
expensive and hard to set up.
The insurance industry sells billions of dollars
of guaranteed payment products but they
require huge upfront investments and 75+%
of consumers don’t understand them.
• A new-to-the-world method of wealth creation &
preservation for married individuals
• Life insurance based, endowment-like product
• Available online in just a few clicks
• Starts at just $15 per month premium
• Deducted from monthly paycheck, credit card or bank
• Guaranteed benefit from $10K to $2MM (chosen by the
consumer) after 25 years
• Includes divorce insurance coverage that grows over time
Why it makes sense
• Almost half of the weddings which take place in the United
States each year will fail. Most within the first 8 years.
• Divorce reduces the average person's wealth by 77%.
• 44% of women go below the poverty line following divorce.
• The percentage of married persons who will reach their 25th
anniversary is only 33%. Moreover, second and third marriages
have a fewer than 1 out of 3 success rate.
• U.S. taxpayers foot an annual bill of over $112 BILLION dollars
in Federal, State and Local taxes to support fragmented families
every year.
• Equivalent investment return for insured is 5.7% compounded
over 25 years
Solution #1Marriage Assurance
What it is
Marriage Insurance Being Pitched in U.S., Canada
CBC | Posted: 4/30/2012 PM – Updated: 4/30/12 2:24 PM
QUICK POLL
Would you buy marriage insurance?
Yes, I think it’s a great idea
No, I think it’s ridiculous
Maybe, depending on the price
44.12%
24.51%
31.37%
Market AcceptanceMarriage Assurance
Insurance agents, financial planners and wealth
advisors love this product
LOIs from agencies across the US representing more
than 54,000 agents
So do large scale Employee Benefits providers like
Mercer, Aon and Watson Wyatt
So does our target audience!
Seven market acceptance studies consistently
showing 40+% responding “I would definitely buy it”,
plus 20-40% saying “maybe, if I knew more about it”.
Solution #2Personal Portable Pension Plan
The easiest way to save for retirement – a simple online
retirement savings product tied to the consumer, not a
company, with a great user experience purchased almost
instantly with complete clarity to the consumer.
• Available online in just a few clicks
• $25 minimum buy in / Patent Pending
• Deducted from monthly paycheck, credit card or bank
• Guaranteed lump sum or fixed income at desired retirement age
• Complexity free, single product focus, no confusing riders
• Captures some of the market gains but none of the market losses
How it worksWhat it is
Survey Monkey poll of more than 1000 adults age 18 – 50. 11 choices of unique
characteristics of 401ks, IRA, traditional annuities and the 4P.
Who chose the exact qualities of a 4P?
• 65.06% chose at least 2 of the characteristics that define a 4P
• 33.73% chose 4 or more qualities that define a 4P
• 20.48% of respondents chose five of five of the choices that described only those
characteristics of a 4P
Conclusion, given the choice, fully one-fifth of the adult population under 50,
employed full time, would call a 4P “an ideal retirement savings vehicle for me”
INDUSTRY PUNDITS LOVE OUR
“ That market [25-55 age group] is wide open.
If you guys capture the holy trinity of online
value [cost, convenience and transparency],
you will be uber successful.”
Jamie Cox, Managing Partner, Harris Financial Group
– Sought after annuity industry authority, recognized by Barron's,
Registered Rep Magazine and Virginia Business Journal as one
of the top independent financial advisors in the country.
Market AcceptancePersonal Portable Pension Plan
Question 8: If I could design the ideal retirement savings vehicle
for me, it would have (check all that apply):
Allianz Study – majority prefers safety over return
Prefer 8% RETURN with possibility of
losing value/vulnerable to market downturn
Prefer 4% RETURN that is guaranteed not to
lose value
24%
76%
Example from one of 3 company initiated independent studies
Who is the Target Market Who is the Target Market
Total # of Americans with Full-Time Jobs =121.41 Million*
30 million
With NO ACCESS to
company sponsored
retirement plans
11 millionWith access but
who choose NOTto participate
• Plus another 22+ million contract, temporary and part-time workers with no
access to retirement plans
* 70 million with access to company sponsored retirement plans – many looking for safe alternatives
59 million
With access and
actively participating
in their retirement
plans
PRIMARY TARGET SECONDARY TARGET
58.2 million
Already married with
no prenuptial
agreement
23.3 million
Previously
divorced one or
more times
44 million
Concerned
parents of
soon-to-be
marrieds
Unique and defensible
How do our products differ from others out there?
• No other company offers anything remotely similar to Marriage Assurance
• No insurance company offers annuities direct-to-consumers online. Only one
online aggregator exists (launched April 2016). Will help us sell!
• We’ll have a better (guaranteed) ROI. 5.7% for MA; Up to 9% for 4P
• No other Defined Benefit Plans can directly compete with 401k plans with such
low cost entry points. $15/month for MA; $25/week for 4P
• No other guaranteed insurance products are designed with living benefits
specifically for people who are just starting their careers and/or their retirement
savings plans.
Barriers to entry?
• IP – Our 4P is patent pending
• Legacy systems – D2C is a huge barrier to entry to existing life insurers,
especially in the annuity market. We’re as much a pioneer in this regard as
Esurance was to the auto insurance segment in 1999.
• “Reputational Risk” – Large insurers are not-so-secretly worried about
associating their brand with what they consider a controversial product.
• Perception of adverse selection risk – 100% of actuaries initially think a near
50% divorce rate equals unprofitability. After stress testing our model 100%
admit they were wrong.
Pilot program geography
and financial data
$000,000 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7
Revenue $7.53 $21.28 $50.84 $111.25 $205.59 $334.54 $497.41
Reserves $6.04 $25.05 $66.25 $168.25 $361.74 $672.29 $1,129.70
Expenses $3.46 $6.17 $11.53 $22.08 $38.31 $59.82 $87.91
Net Income $0.25 $0.93 $3.55 $9.88 $22.13 $41.22 $68.99
PILOT STATES
EXPANSION IN 1ST YEAR
Alaska
Hawaii EXPANSION BY 3rd YEAR
The Team
Management Team Key Board Members
• CEO, SafeGuard Guaranty Corporation
• 33 years of New Product Dev, 14 in the
insurance industry
• 5 successful startups in 4 distinctly
different industries
John Logan | Founder & CEO
• 30+ years of C level experience in
banking and insurance
• VP, The First Bank of Chicago
• Co-founder, Swift Insurance Brokers
• CEO/CFO, CMA Insurance Holdings
Thomas Mayo | CFO
• 30+ years of C level experience in
insurance
• VP, MassMutual, Annuities Division
• VP, The Hartford, Agency Strategy,
eBusiness & Technology
Kenneth Fries | EVP Distribution
& Strategic Alliances
• 17+ years of C level multi-channel
marketing experience in both
digital & non-digital environments
• VP of Digital Marketing Strategy
for Harte Hanks
• Former life insurance agent
Sebastian Pistritto, VP of Marketing
• 30+ years of C level life insurance &
annuities experience
• President, Citicorp International
Insurance
• SVP, Citigroup (Marketing & Product
Development)
• VP, National Life of Vermont
Chad Masland | Director
• CEO, Traction and Scale LLC
• Co-founder, Kitara Media, public
rollup in digital advertising
• Co-founder, inSparq, leading social
commerce company
Richard Hecker | Director
The Opportunity
Raising $2,500,000
Preferred Shares
Use of Funds
$1,500,000 = Required Reserves and Surplus
to create the insurance underwriting entity
$1,000,000 = Operating Expenses
Estimated valuation
EOY 1 = $12,052,948
EOY 7 = $1,571,532,570
Thank you
John Logan, CEO | SafeGuard Guaranty Corporation
Direct: 919-745-0697
www.safeguardguaranty.com