AIICO INSURANCE PLC UNIQUE PRODUCT CAP

Date: ------------------

Attention: -------------------------

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Dear Sir,

PROPOSALS ON THE CASH ACCUMULATION PLAN (CAP) & CHILDREN EDUCATION PLAN (CEP).

I am pleased to enclose a copy of our proposal on the Cash Accumulation Plan & Children Education Plan for your kind consideration.

For further clarifications please do not hesitate to call me.  I am available for a meeting on receipt of a short notice.

Thank you for your co-operation.

Yours faithfully,

OPARA MARTINA

AGENCY MANAGER

08033251956

01-7375571.

INTRODUCTION

I would like to introduce our company – Aiico Insurance Plc (AIICO) and some of its products to you.

Aiico Insurance plc commenced operation in 1963 as a collection centre, and was incorporated in 1990. To date, Aiico has become the largest life. Insurer in Nigeria.

The company’s success has been the result of the ability to evaluate its potentials, set realistic goals and make necessary actions to achieve them.

In recognition of her achievements; the company has worn many laurels. In 2007 Aiico Insurance won the president’s merit award of the Nigerian Stock exchange for the insurance sector.

Aiico is reputed for quality insurance services and prompt settlement of claims. It is recognized not only for its size and delivery network, but also for the range of products it offers. We are able to tailor specific insurances to meet your needs.

Aiico has a customer- driven policy of rendering prompt and efficient services, making use of ultra modern information technology and top class professionalism we are reputed for quality insurance services and prompt settlement of claims.

1)    THE CASH ACCUMULATION PLAN (CAP). The Aiico Cash Accumulation Plan is a multi benefit plan that protects and pays one even when one is still living.

The program has duration of 12years, 15yrs, 18yrs and 21yrs. The individual who is younger can choose a longer duration which reduces his premium (The regular amount he pays annually or semi annually).

2)   INSTALMENTAL PAYMENTS: The insured can receive his face amount in three installments and so does not have to wait till the final maturity e.g. 12years. For a 12years plan and a sum assured (Insurance value or face amount) of N5, 000,000 for example;

1^st payment                      -                  25% of N5m          - at the 4^th year,

                             (N1, 250,000).

2^ND payment                    -                  25% of N5m          - at the 8^th year

 (N1, 250,000).

3^RD payment                              -                  N100% of N5m      - at the 12^th year,

(N5, 000,000)

           +

                   plus accumulated yearly bonuses

PROTECTION

Provides for full payment of the face amount (N5, 10m, N20m) plus bonuses in the event of death of the policy holder during the period of insurance even before the first installment is due.

·         If death occurs at any time after the instalment payment has just been paid, the full face amount of N5m, N10m, N20m plus all bonuses will be paid without making deductions for the installments already paid.

MATURITY BENEFITS

·         It is not compulsory to take the installmental payments. The money may be left

with Aiico at a good interest. In this case the individual will receive the money

multiplied as the accrued reversionary bonuses, interest on investment of

installments and the full face amount will be paid at the maturity.

·         Where the installments have been paid the accrued reversionary bonuses in addition to the full face amount (N5m, N10m N20M) will be paid at the maturity.

INVESTMENT OF INSTALLMENTS

     You can use the installments anyway you like.

(a)    Invest in your business or anywhere else at a good rate of return.

(b) Leave the money with aiico at a high rate of interest which will be               communicated to you at the time.

(c) Use the money for children education.

(d)         Use the money for other urgent needs.

LEVEL PREMIUM

While enjoying increasing protection and a growing investment fund your

premium will remain the same throughout the duration of the policy.

ACCIDENTAL BENEFITS

Accidental death benefits are offered where death occurs by accident. While a monthly income is offered for permanent and total disability.

WAIVER OF PREMIUM

In the event of disability due to sickness or accident, premiums which falls

within the period of disability and incapacitation will be waived.

The policy will however remain in force as if the policy holder was paying

premiums normally.

In order to rate a premium on the above product the following information is required from the proposed insured.

(1)          -   Amount of Insurance (Sum Assured)

(2)         -   Age

(3)         -   Duration

However, the following illustrations are based on examples of N10m & N50m Insurance for 18 years duration at ages 35 to 50 years.

(1)          N10m for 18yrs at ages 35 – 50

AGE (YRS)	ANNUAL PREMIUM(N)	SEMI ANNUAL PREMIUM (N)
35	928,300	482,716
36	934,800	486,096
37	936,900	487,180
38	939,300	488,436
39	942,100	489,892
40	944,200	491,244
41	953,200	495,664
42	957,200	497,744
43	961,500	499,980
44	966,400	502,528
45	971,800	505,336
46	982,500	510,900
47	989,000	514,280
48	996,200	518,024
49	9,004,200	522,164
50	1,013,000	526,760

(2)         N50m for 18yrs at ages 35- 50yrs.

AGE (YRS)	ANNUAL  PREMIUM(N)	SEMI ANNUAL PREMIUM(N)
35	4,611,300	2,397,876
36	4,642,800	2,414,260
37	4,653,300	2,419,716
38	4,665,300	2,425,956
39	4,679,300	2,433,236
40	4,692,300	2,439,996
41	4,734,800	2,462,096
42	4,754,800	2,472,996
43	4,765,820	2,478,226
44	4,800,800	2,496,416
45	4,827,800	2,510,456
46	4,876,300	2,535,676
47	4,707,320	2,573,896
48	4,949,800	2,573,896
49	4,989,800	2,594,696
50	5,033,800	2,617,576

          CHILDREN EDUCATION PLAN (CEP)

-      This policy provides payment of annual premiums for periods ranging

from 10 to 25yrs.

-      Guaranteed payments of school fees in the event of death, total and permanent disablement of the parent/guardian.

-      Provides for payment of a lump sum at maturity when the child enters university (or secondary school.

-      Provides for return of premiums in the event of death of the child before the maturity of the plan.

-      The fund may be transferred to the benefit of any other child of the policy holder in the event of the beneficiary.

-      In the event of death of the policy holder.

-      Future premiums will be waived

-      A monthly income of 1% of the sum assured (N100, 000 monthly incomes for N10m sum assured) will be paid to the policy holder.

-      On maturity, the agreed fund (sum assured) will be paid for the child’s education.

In order to rate a premium on the above product the following information is required from the proposed insured.

1)    -        Amount of insurance (sum assured)

2)   -        Age

3)   -        Duration.

The following illustration is based on the example of an N10m for 15yrs at ages 35 – 50yrs.

AGE (YRS)	ANNUAL PREMIUM(N)	SEMI ANNUAL PREMIUM(N)
35	620,300	323,556
36	625,800	325,416
37	632,300	328,796
38	639,400	332,488
39	647,900	336,908
40	637,300	341,796
41	667,400	347,048
42	688,800	358,176
43	646,400	336,128
44	725,800	377,416
45	746,900	388,388
46	766,000	398,320
47	799,400	415,688
48	828,800	430, 976
49	860,800	447,616
50	896,300	466,076

BASIC MINIMUM INSURANCE FOR A MARRIED MAN WITH CHILDREN

MINIMUM BASIC INSURANCES TO BE ARRANGED BY A MARRID PERSON BLESSED WITH CHILDREN

A)   Educational provision for the children: No child is worth bringing to life without adequate education. Though many people do all kinds of things with the hope of securing the education of the child. Some people claim they have built or bought a house so that the rent that is generated from it can be used to pay for the education of the child. Some buy bus or buses so that income that come from them can be used to secure the education of the children yet another set of people buy stocks and bonds to secure the education of the children. On the other hand some open bank account to ‘save ‘money for the children education. However when you equate any of the so called protection for children education to life’s major contingencies like disability and death they all fail woefully!

House

In case of permanent disability you may most likely sale the house to bring back the health of the man, In case of death you have left what the child should have to protect other than what would protect the child; that is if the house is not even sold to fight for the man’s life before eventual death. IN Africa here it is not unlikely that family members may seize your property from your hapless widow and children.

BUSES

It is evident that vehicles driven with mouth rarely use fuel. Transportation business is full of uncertainties that some who really invested real money into it have a bloody nose more often than anticipated before they leave the business; you can imagine what would happen to some one with one or two buses. One or two accidents or  even a police or LATSMA trouble would get your little transport tower tumbling into a ready quick sand and would effectively knock out your supposed income from transport business to the wild wind even in short time  not to talk of on a long time.

STOCKS and BONDS

The feet with which most of our stock bigots come out of the murky water of stock crash is still fresh, it is simply a highly risky venture. Though if you are lucky you can make some quick money out of your stock in a short interval but to think that you would use stock to secure the education of your children that would take at least 15 years would be taking you luck too far out of range incase of disability. Most likely your stocks would be melted away to save your life and the same thing in case of untimely death. In fact it may even be sold to do funeral! So where does the education of the child lie in this?

SAVINDS IN BANK

This is the most hopeless to use the current need bank savings to ‘secure’ the education of a child that would span 15 to 18 years! Can you honestly pin-point one man who has ran a savings account diligently for five years without one single unavoidable withdrawal? If you cant for such a short period of 5 years how then do you hope you would use your savings account to plan for the education of your children that would last a long time. It is no doubt that it is the savings accounts that actually go first when disability or death come calling!

EDUCATIONAL INSURANCE

There is no doubt that the only one safe secured and sure way to secure the education of your children is EDUCATIONAL ASSURANCE POLICY. This unique arrangement satisfies the law of successful thrift, successful accumulation and adequate time that inevitably yield the strategic needed income. ST+ SA + AT = NI. Besides it licks the contingency of disability by paying for itself (Self Sustenance) in case of disability. In case of Death it automatically provides the entire insured amount to train the child irrespective of the number of installments you have paid!

B PAY YOURSELF

Every other thing you are expending your money on while going through life, you are paying others; but you would definitely be learning from other people’s mistake by opting to pay yourself by your self. This is because if you allow other people to pay you, you may definitely not be too far from untold sorrow.

What do I mean? While paying everybody else keep some for the old man you would be someday’ if you do not intend to go begging to children, your appointed succeeding manager and others when you are supposed to play big daddy! Pay yourself by organizing an executive retirement plan for your self and spouse alone. No other investment mentioned in A above can help you absolutely to have a retired future other than your EXECUTIVE RETIREMENT PLAN

With these two, though there are some other good ones ypou have a firm foundation on your financial security.

IGWEGBE LAWRENCE