Coming September 19th:

Custom Care III and Core Care in FL, HI, NJ, NY and NV

On September 19, 2011, we will introduce our new product portfolio - Custom Care III and Core Care - in Florida, Hawaii, New Jersey, New York* and Nevada. (*Non-Partnership only)

NOTE: Once Custom Care III and Core Care are launched, Custom Care II Enhanced will no longer be available. All Custom Care II Enhanced applications in applicable states must be signed no later than September 18, 2011, and received in the home office no later than September 19, 2011.

Overview of Custom Care III & Core Care

John Hancock's latest LTC insurance offerings, Custom Care III and Core Care, were developed based on today's realities. The design, benefits, and pricing of each product reflects:

• recent trends in our growing body of claims experience, and the prevailing conditions that exist within today's economic environment
• our commitment to providing flexible solutions that enable you to meet the individual needs, preferences, and budget of each client

Custom Care III is a highly customizable solution offering a variety of optional riders, similar to its predecessor Custom Care II Enhanced. Core Care is a streamlined solution based on the Custom Care III chassis, emphasizing greater affordability and simplified policy design to help facilitate the sales process.

New features of Custom Care III and Core Care

• CPI Compound Inflation to Age 751 allows the Daily Benefit and Total Pool of Money to be adjusted each year on a compounded basis, according to increases in the Consumer Price Index (CPI). The potential amount of the annual CPI increase is unlimited, even during periods of the highest inflation. In the event that the CPI decreases, the benefit amount will not be reduced. Annual benefit increases will occur on each policy anniversary through your 75th birthday.
• Paid-Up at Age 75 is an attractive option for clients 55 or younger who want to eliminate paying premiums during their retirement years.

On Custom Care III, the following new feature is also available:

• 20-Pay2 enables your clients to pay the full cost of their policy over 20 individual, annual payments.

1 This benefit is not available to applicants over age 70. There will be no further increases on or after the policyholder's 76th birthday.

Not available in AZ or DE.

2 The maximum issue age for 20-Pay is 69.

Other key highlights include:

Change to definition of Adult Day Care for Interstate Compact States

There is a change to the definition of Adult Day Care in all Interstate Compact states. The change is effective on a go forward basis and previously issued policies are not impacted. The definition of Adult Day Care does not meet the Uniform Standards of the Interstate Compact, therefore the definition has been revised and the policy form number only on page 6 has changed to ICC10-LTC11 5/11.

The definition is as follows: Adult Day Care means social and health-related services provided during the day in a community or group setting to six (6) or more persons (or a fewer number of persons as required by applicable state law or regulation.) The purpose of the program is to support frail or impaired elderly, or other disabled adults who can benefit from care in a group setting outside the Home.

Illustrations, rate cards, and reports

On September 19, 2011, you can illustrate these products on eHansel and Hansel (version 14). Rate cards will also be available to download: Custom Care III: LTC-8003, Core Care: LTC-8103. State versions apply in Florida and New York.

Spousal fillable application booklets

Electronic versions of applications in these states are available to order beginning today and will be available to download, completed and saved in a PDF on September 19, 2011. Note: You will still need to print, sign, and
mail the application to the home office. Review the Fillable Application Flier (LTC-8719) for details. Refer to the chart on the back of this memo for your state's corresponding application form number.

The joint application contains a checklist on how to complete the package, HIPAA Medical Authorization form, Outline of Coverage, and all state-required forms. Other updates include:

• Personal Worksheets have been updated to disclose our rate increase history.
• Updated Credit for Application page for referral splits, to indicate the involvement of a referring producer who helped solicit or sell the case.
• Automatic Deduction Plan (7269R) is a new addition within the application.

State variations

FLORIDA

• Daily Benefit = $50-$300,
• Monthly Benefit = $1,500-$9,000
• 365-day Elimination Period - not available
• Waiver of Home Health Care Elimination Period = Waiver of Elimination Period
• Coordination of Benefits - not available
• Timely Payment of Claims = 10% interest on late payment of claims
• Special Contingent NF Benefit for Limited Pay policies
• Employer Pay for Sponsored Group - not available - Loyalty Credit - not available
• Marital discount for spouses only not partners

NEW JERSEY

• Coordination of Benefits - not available
• Total Homemaker Services covered under regular HHC Benefit
• Special meals is a mandated benefit under HHC
• Family Discount - not available
• Partners include members of a civil union and registered domestic partners - no 3-year requirement

NEW YORK

• Daily Min = $70 (Non-metro area), $100 (in metro area)
• Monthly Benefit = $2,200-$15,500 (Non-metro area), $3100 (in metro area)
• 365-day Elimination Period - not available
• Only Domestic Partners/Spouses qualify for Couples Discount, SharedCare, and Survivorship and Waiver of Premium
• Coordination of Benefits- not available
• Contingent Nonforfeiture with Standard Pay and Limited Payment Options - not available
• Total Homemaker Services covered under regular HHC Benefit
• Couples/Partner Discount = 20%
• Marketing Group Discount (including Valued Client) for non-Marketing Group Policy Form - not available
• Marketing Group 5% Employer-pay all discount - not available. Employer or Association may only pay up to 50% of premium.
• Family Discount, Valued Client, and Loyalty Discount - not available