New York Life Instant Life Insurance QuoteState:AlabamaAlaskaArizonaArkansasCaliforniaColoradoConnecticutDelawareDist.ColumbiaFloridaGeorgiaHawaiiIdahoIllinoisIndianaIowaKansasKentuckyLouisianaMaineMarylandMassachusettsMichiganMinnesotaMississippiMissouriMontanaNebraskaNevadaNew HampshireNew JerseyNew MexicoNY Non-BusNY BusinessNorth CarolinaNorth DakotaOhioOklahomaOregonPennsylvaniaRhode IslandSouth CarolinaSouth DakotaTennesseeTexasUtahVermontVirginiaWashingtonWest VirginiaWisconsinWyomingGuamPuerto RicoVirgin IslandsAmer. SamoaBirthdate:JanuaryFebruaryMarchAprilMayJuneJulyAugustSeptemberOctoberNovemberDecember 12345678910111213141516171819202122232425262728293031 191019111912191319141915191619171918191919201921192219231924192519261927192819291930193119321933193419351936193719381939194019411942194319441945194619471948194919501951195219531954195519561957195819591960196119621963196419651966196719681969197019711972197319741975197619771978197919801981198219831984198519861987198819891990199119921993199419951996199719981999200020012002200320042005200620072008Gender:MaleFemaleSmoker/Tobacco:NoYesHealth Class:Preferred PlusPreferredRegular PlusRegularType of Insurance:1 Year Level Term5 Year Level Term10 Year Level Term15 Year Level Term20 Year Level Term25 Year Level Term30 Year Level Term35 Year Level Term40 Year Level TermTo Age 65 LevelTo Age 70 LevelTo Age 75 LevelTo Age 80 LevelTo Age 85 LevelTo Age 90 LevelTo Age 95 LevelTo Age 100 LevelTo Age 105 LevelTo Age 110 LevelOther Term10, 20, 30 Year TermAll Level Term Product Categories10 Year Return of Premium15 Year Return of Premium20 Year Return of Premium25 Year Return of Premium30 Year Return of PremiumTo age 65 Return of PremiumTo age 70 Return of PremiumTo age 75 Return of PremiumOther Return of Premium15, 20, 30 Year with ROPReturn of Premium ProductsTo Age 121 Level (No Lapse U/L)To Age 121 Level – Pay to 100To Age 121 Level – Pay to 65To Age 121 Level – 20 PayTo Age 121 Level – 10 PayTo Age 121 Level – Single PayFace Amount:$10,000$25,000$50,000$75,000$100,000$125,000$150,000$175,000$200,000$225,000$250,000$300,000$350,000$400,000$450,000$500,000$550,000$600,000$650,000$700,000$750,000$800,000$900,000$1,000,000$1,100,000$1,250,000$1,500,000$1,750,000$2,000,000$2,500,000$3,000,000$4,000,000$5,000,000$6,000,000$7,000,000$8,000,000$9,000,000$10,000,000Your Name:Phone Number:E-mail Address: New York Life is awarded the highest ratings for financial strength from all four of the major rating agencies, a testament to its solid financial stewardship, even in troubled times.We found the right individual in Ted Mathas. Ted Mathas, who succeeded me in 2008 as the Companyâ€™s 18th CEO, brings immense talent and leadership to the job. Just as important, there is no one more committed to the continuity of New York Lifeâ€™s core values â€“ or more qualified to uphold them. I first observed Tedâ€™s management skills nine years ago, when he managed NYLIFE Securities, our broker-dealer subsidiary. Since then, he has established a remarkable track record for success in a series of increasingly responsible positions. When the board of directors convened early in 2008 to consider CEO succession, their choice was unanimous. Ted Mathas is an excellent president and CEO. The time is now right for Ted to assume the additional role of chairman of the board. We are fortunate to have a leader of Tedâ€™s judgment, energy, intellect and vision to serve in these capacities. In conclusion, I am pleased to report that, in spite of the uncertainty of the financial markets and the state of the economy during the latter part of 2008, the situation at New York Life is very much business as usual: Our financial strength is solid. Our values are sound. Our devotion to doing whatâ€™s right for our policyholders is uncompromised. This is how it always has been and always will be at New York Life. On behalf of the board of directors, I thank you for continuing to let us be â€œThe Company You Keep.â€ Sy Sternberg Chairman of the Board February 12, 2009 Re p o r t t o Po l i c y h o l d e r s 2 0 0 8 By Gary Wendlandt Vice Chairman of the Board and Chief Investment Officer The latter part of 2008 was characterized by commentators as a â€œfinancial tsunamiâ€ â€“ an apt description. As I write this report in February of 2009, there are indications that, with the unprecedented level of government intervention, some level of stability may be returning to the financial markets, but there is no evidence to suggest a rapid economic recovery. Although subprime mortgage lending was the trigger for the crisis, it was only one aspect of a much larger credit boom and bust that has had far-reaching effects on the global economy. At the height of this boom, we saw widespread declines in lending standards and, at the same time, a growing number of firms willing to invest in increasingly risky and complex credit instruments, with expectations of oversized returns. An environment of easy credit also encouraged financial institutions to borrow heavily in order to participate in all manners of investments. This aggressive leveraging strategy created outsized immediate returns for these firms but also created staggering losses when the housing bubble burst. New York Life has remained strong throughout the crisis, ending 2008 with over $12.8 billion in statutory capital and retaining the highest ratings for long-term financial strength from all four of the major rating agencies. Last year, I reported to you about our initial response to the overheated credit market. We believed the risks inherent in popular investment vehicles far outstripped the rewards. Rather than get caught in the prevailing climate of over-optimism, we invested cautiously. As an added precaution, we also temporarily allocated a larger portion of the Companyâ€™s investments into safe U.S. Treasury bonds. Putting Your Safety First: An update on New York Lifeâ€™s financial strength Pu t t i n g Your Sa f e t y Fi r s t 12 Re p o r t t o Po l i c y h o l d e r s 2 0 0 8 In our 2007 Report, I also detailed a number of the most important principles that guide investment decisions at New York Life. These guidelines are worth revisiting here, as they will help you better understand how we have been able to protect the interests of our policyholders amid the events of 2008. We maintain diversification. We do not take outsized stakes in any single investment opportunity, no matter how attractive it may appear. Because of this, we had a very low level of exposure to individual firms, particularly in the troubled financial sector. New York Life typically maintains one of the most diversified investment portfolios among all of the major life insurers. As of year-end 2008, our ten largest credit exposures amounted to less than two percent of our total portfolio. We conduct our own research. We do our own fundamental, bottom-up research, rather than rely on the analysis of others. Based on our research, we independently concluded that many debt securities â€“ including the complex repackaging of subprime mortgages â€“ held far more risk than their ratings suggested. We insist on getting paid for taking risk. Our research showed that the real estate loans underlying collateralized debt obligations (CDOs) were subject to weak lending standards and questionable underwriting practices. These investments were inherently risky because they were originated with the intent to immediately repackage and sell them. We thought it foolish to take on someone elseâ€™s risk if they demonstrated an unwillingness to hold it themselves. Similar reasoning stood behind our decision to avoid credit default swaps â€“ the financial instruments that insure creditors against the risk of default. The inherent risks were mispriced because investors believed that historical low levels of default rates would continue â€“ a misjudgment that proved extremely costly for many firms. Pu t t i n g Your Sa f e t y Fi r s t 13 Re p o r t t o Po l i c y h o l d e r s 2 0 0 8 We take a long-term view. We invest for the long term because we make long-term commitments to our policyholders. As a mutual company, New York Life Insurance Companyâ€™s investment decisions are not subject to shareholder pressures for quarterly profit gains. We will â€“ and do â€“ forsake the potential of short-term gains in order to preserve long-term safety. This is exactly what took place two years ago, when we reallocated some of our investable cash flow from credit market investments to the security and liquidity of U.S. government bonds. We maintain ample liquidity. For New York Life, liquidity is â€œking,â€ as we must always be prepared to meet our obligations to policyholders. Our strong balance sheet is your assurance of protection in this environment. Unlike other financial firms, we have not been forced to sell assets in order to raise cash in a down market and do not require infusions of government capital. Indeed, the strength and liquidity of our portfolio will enable us to take advantage of the attractive investment opportunities that will arise in the years ahead. We donâ€™t blindly follow the crowd. New York Life has been through numerous economic cycles in its 164-year history, and we have learned to avoid both the frenzy of overheated markets and the panic that occurs when markets tumble. For example, we did not join the rush to invest in hedge funds, as we are not comfortable with their lack of transparency. We simply will not participate in investments we cannot thoroughly analyze. Pu t t i n g Your Sa f e t y Fi r s t 14 Re p o r t t o Po l i c y h o l d e r s 2 0 0 8 Sadly, the most damaging losses suffered by financial companies and individual investors could have been avoided through the application of these, and other, common-sense investment principles. On pages 18 and 19, we discuss a few of the ways New York Lifeâ€™s investment philosophy can apply to your own familyâ€™s financial planning. As we look ahead, it is still not possible to forecast the duration or depth of the current economic cycle. It appears that the recession will continue well into 2009 and it is reasonable to expect that corporate bankruptcies and defaults will continue to rise. New York Life is certainly not immune to what occurs in the financial markets, but historically, our portfolio has experienced lower defaults â€“ and better recoveries in cases of defaults â€“ than market averages. With our strong balance sheet, disciplined investment approach and rigorous risk controls, we are well positioned to continue to deliver superior investment results. Our primary goal is ensuring we can meet all of our obligations to policyholders, now and decades from now. No matter how the markets perform in 2009 â€“ and in the years beyond â€“ New York Life will be here, secure as always, standing behind every promise we make. Pu t t i n g Your Sa f e t y Fi r s t 15 Re p o r t t o Po l i c y h o l d e r s 2 0 0 8 Our Performance at a Glance Our Pe r f o r m a n c e a t a G l a n c e 16 YEAR IN $ MILLIONS 2008 1,283 2007 1,278 2006 1,096 2005 942 2004 978 Operating earnings is the measure used for management purposes to highlight the Companyâ€™s results from ongoing operations and the underlying profitability of our business. In 2008, New York Life achieved record-setting operating earnings of $1.283 billion. OPERATING EARNINGS3, 4 YEAR IN $ MILLIONS 2008 12,826 2007 14,680 2006 13,859 2005 12,853 2004 11,838 Surplus and asset valuation reserves, the funds that ensure we can meet future obligations to policyholders and finance our growth, declined in 2008 as a result of the weak equity and credit markets, yet remain well above historical levels. The Company has more than enough capital to meet rating agency capital requirements for their highest possible financial strength ratings. YEAR IN $ BILLIONS 2008 14.0 2007 13.0 2006 11.9 2005 10.8 2004 10.1 This chart shows the revenue the Company has generated from its domestic and international business during the last five years â€“ primarily premium and fee income, deposits included in policyholder account balances for life and annuity products, and net margins on guaranteed products. Operating revenue has grown steadily since 2004. OPERATING REVENUE3 NOTES APPEAR ON PAGE 2O. YEAR IN $ BILLIONS 2008 14.7 2007 14.1 2006 12.6 2005 10.9 2004 9.5 With $14.7 billion in payments made to beneficiaries and policyholders in 2008, we again exceeded previous totals, a reflection of the growing number of people who today count on New York Life for financial security. Benefits include death claims paid to beneficiaries and annuity payments. Dividends are payments made to eligible policyholders from divisible surplus. POLICYHOLDER BENEFITS AND DIVIDENDS1 SURPLUS AND ASSET VALUATION RESERVES2 YEAR IN $ MILLIONS 2008 2,427 2007 2,149 2006 1,891 2005 1,583 2004 1,488 This chart shows the growth of new insurance sales since 2004 and includes results from both our domestic and international operations. 2008 was another record year for the Company, exceeding $2 billion in sales for the second consecutive year. Over the past four years, our insurance sales have grown at a compound annual rate of 13 percent. INSURANCE SALES5 Re p o r t t o Po l i c y h o l d e r s 2 0 0 8 Our Pe r f o r m a n c e a t a G l a n c e 17 YEAR IN $ BILLIONS 2008 249.1 2007 280.0 2006 261.5 2005 222.8 2004 213.0 Assets under management declined in 2008, a result of the weakening of equity markets. However, over the past four years, the Companyâ€™s assets under management have grown by over $36 billion, reflecting the strength of the Companyâ€™s diversified products and distribution channels. ASSETS UNDER MANAGEMENT YEAR IN $ MILLIONS 2008 26,632 2007 24,789 2006 23,815 2005 18,776 2004 15,406 Investment sales include new sales of investment annuities, mutual funds and other investment-related products by both our domestic and international operations. In 2008, investment sales increased over $1.8 billion from 2007, due to growth of our fixed annuity business. INVESTMENT SALES6 YEAR IN $ BILLIONS 2008 781.2 2007 750.9 2006 694.8 2005 647.7 2004 611.2 This chart shows the growth of the Companyâ€™s individual life insurance in force over the last four years. Our steady growth â€“ $170 billion since 2004 â€“ is the sign of a strong and vibrant company. NOTES APPEAR ON PAGE 20. INDIVIDUAL LIFE INSURANCE IN FORCE7 Re p o r t t o Po l i c y h o l d e r s 2 0 0 8 The current state of the economy is understandably a cause for concern. While everyoneâ€™s situation is unique, we offer the following suggestions for you to keep in mind as you review your familyâ€™s financial plans. Preserve Your Future Assets Unless absolutely necessary, you should not tap into assets and resources set aside for future use in an effort to address current challenges and expenses. Early withdrawals from IRAs and other qualified plans often bring costly taxes and penalties. Moreover, you can never recoup the time youâ€™ve spent saving for retirement. If you start using the dollars that youâ€™ve been accumulating for years, you may find it difficult to replenish those savings and you will have fewer assets working for you when the markets rebound. Maintain a Diversified Portfolio All types of financial assets â€“ life insurance, savings accounts, CDs, annuities, bonds and stocks â€“ perform differently in different economic climates. Maintaining a broad portfolio mix (that is, â€œnot putting all your eggs in one basketâ€) can help dampen the effects of market fluctuations or problems in any single area. Donâ€™t Chase the Latest Financial or Investment Fads History has proven that acting on the latest â€œhotâ€ financial tip usually produces dismal results in the end. Take the time to regularly review your financial plans with your agent or advisor to ensure they continue to meet your needs and objectives â€“ but donâ€™t hastily abandon what you have to blindly follow the crowd in another direction. And donâ€™t listen to people who try to forecast market movements. They donâ€™t know! Protecting Your Familyâ€™s Financial Future Adhering to Sound Planning Principles Is the Best Course of Action â€“ in Good Times and Bad P r o t e c t i n g Your Fa m i l y â€™ s Fi n a n c i a l Future 18 Re p o r t t o Po l i c y h o l d e r s 2 0 0 8 Manage Your Risk Carefully If you take on too much risk when the markets are soaring (when everything looks safe), you are exposing yourself to sizable losses when the markets decline, making it very difficult to stay the course and ultimately achieve your long-term investment goals. When planning for retirement, many people choose to balance the inherent risks of investment products with other financial products that offer guaranteed income upon retirement (such as Guaranteed Lifetime Income annuities). Regardless of what products you ultimately purchase, be sure to check the financial strength rating of the company you are buying from. Keep a Long-Term Perspective on Your Financial Future It is important to remember that markets are cyclical: They go upâ€¦they go downâ€¦and they go up again, bringing feelings of both optimism and pessimism for investors. Rather than react to each swing of the market, it is usually appropriate to stick with a carefully considered long-term strategy, especially when it comes to your retirement and other long-range needs. Your New York Life agent can help you select from a number of products that have withstood the test of time and bring a measure of safety, so you know your money will be there when you need it â€“ even if that is decades from today. Call upon the Knowledge of Your New York Life Agent As a New York Life customer, you are not alone when it comes to planning for, and protecting, your familyâ€™s financial future. We stand ready to assist you in any way we can â€“ and your New York Life agent is just a phone call away. He or she is most familiar with your particular situation, plans and objectives. And when you do business with one of our representatives, you can be confident that you are working with someone who is held to the highest standards of professionalism and integrity, and backed by one of the strongest and most respected companies â€“ a company that will be there for you in good times and bad. P r o t e c t i n g Your Fa m i l y â€™ s Fi n a n c i a l Future 19 Re p o r t t o Po l i c y h o l d e r s 2 0 0 8 Notes No t e s 20 1 Policyholder benefits and dividends include New York Life Insurance Company (NYLIC), New York Life Insurance and Annuity Corporation (NYLIAC), NYLIFE Insurance Company of Arizona (NYLAZ) and the Companyâ€™s international operations at percent ownership. NYLICâ€™s policyholder benefits and dividends were $8.1 billion for each of the 12 months ended December 31, 2007 and 2008. NYLIACâ€™s policyholder benefits and dividends were $5.4 billion and $5.2 billion for the 12 months ended December 31, 2007 and 2008, respectively. NYLAZ is not authorized in New York and does not conduct insurance business in New York. 2 Statutory capital includes statutory surplus and the asset valuation reserve (AVR) on a consolidated basis of the Company. NYLICâ€™s statutory surplus was $11,959 million and $11,793 million at December 31, 2007 and 2008, respectively. Included in NYLICâ€™s statutory surplus is NYLIACâ€™s statutory surplus totaling $2,650 million and $3,596 million at December 31, 2007 and 2008, respectively. AVR for NYLIC was $2,257 million and $649 million at December 31, 2007 and 2008, respectively. AVR for NYLIAC was $464 million and $384 million at December 31, 2007 and 2008, respectively. 3 This chart has been prepared in accordance with our primary management reporting system, which is based on accounting principles generally accepted in the United States of America (GAAP) with certain adjustments we believe are more appropriate as a measurement approach. A reconciliation is contained in the Companyâ€™s 2008 Annual Report. Policyholders may request a copy of the GAAP-basis consolidated unabridged financial statements and the 2008 Annual Report by writing to New York Life Insurance Company, 51 Madison Avenue, New York, New York 10010. Policyholders may obtain a copy of the statutory financial statements applicable to their respective companies by contacting the Secretary of the parent company, New York Life Insurance Company, 51 Madison Avenue, New York, New York 10010. The GAAP and statutory financial statements mentioned above will be available beginning mid-April 2009 on our Web site (www.newyorklife.com). Although the GAAP-basis consolidated unabridged financial statements are prepared in accordance with GAAP, the New York State Insurance Department (the Department) recognizes only statutory accounting practices for determining and reporting the financial condition and results of operations of an insurance company, for determining its solvency under the New York Insurance Law, and for determining whether its financial condition warrants the payment of a dividend to its policyholders. No consideration is given by the Department to financial statements prepared in accordance with GAAP in making such determinations. The notes to the GAAP-basis consolidated unabridged financial statements contain a reconciliation of GAAP net income to statutory net income as well as a reconciliation of GAAP policyholdersâ€™ equity to statutory surplus and asset valuation reserves. 4 This indicator has been revised for years 2004â€“2007 to conform to the Companyâ€™s change in definition of operating earnings, effective 1/1/2008. A complete description of this revision can be found in the Companyâ€™s 2008 Annual Report, which will be available beginning mid-April 2009 on our Web site (www.newyorklife.com). 5 This indicator has been revised for years 2004â€“2007 to conform to the Companyâ€™s change in definition of insurance sales, which adjusted single premium sales including immediate annuities to 50 percent, effective 1/1/2008. A complete description of this revision can be found in the Companyâ€™s 2008 Annual Report, which will be available beginning mid-April 2009 on our Web site (www.newyorklife.com). 6 2006 investment sales include $1.1 billion of sales related to an acquisition of an investment subsidiary in 2006. 2004 investment sales include $1.25 billion of sales related to an acquisition of an investment subsidiary in 2004. This indicator has been revised for years 2004â€“2007 to conform to the Companyâ€™s change in definition of investment sales, effective 1/1/2008. A complete description of this revision can be found in the Companyâ€™s 2008 Annual Report, which will be available beginning mid-April 2009 on our Web site (www.newyorklife.com). 7 Face amounts.