Pacific Life Insurance Company

16-5

Client Guide

PACIFIC INDEXEDPROTECTOR 2Indexed Universal Life Insurance

ESTATERETIREMENTBUSINESSFAMILY

THE FLEXIBILITY OF CASH VALUE LIFE INSURANCE

FINANCIAL PROTECTION

A policy’s proceeds are

paid to policy beneficiaries

when the insured dies.

FINANCIAL POTENTIAL

A policy’s cash value

has the potential to grow,

less policy charges.

FINANCIAL FEATURES

A policy’s optional

features are available for

additional life insurance

and financial needs.

02

BECAUSE YOUR FAMILY COMES FIRST

They are there with you on your journey through life. You look after

them. They look after you. It’s your family. They come first.

Part of looking out for your family is trying to protect them from risks.

And one of their biggest risks is what they would do without you.

What if you were to die too soon? Could your family get by without your income?

Pacific Indexed Protector 2 is an indexed universal life insurance

product from Pacific Life Insurance Company. It can help provide

your family with financial protection through income replacement from

policy proceeds if you die prematurely.

As cash value life insurance, each premium you pay has the potential

to do more for your family.

Policy form #P15IUL, S15PIAPR or ICC15 P15IUL, ICC15 S15PIAPR, based

on state of policy issue.

03

FAMILY

Premiums, Charges, and Current Rates

POLICY PREMIUMS: Your premiums are flexible.

Choose the amount you want to pay and the timing.

As long as your policy’s cash value is sufficient to pay

ongoing policy charges, your policy will stay in force.

Indexed universal life insurance generally requires

additional premiums after the initial payment. If either

no premiums are paid or subsequent premiums are

insufficient to continue coverage, it is possible the

coverage will expire.

POLICY CHARGES: The cost of insurance and benefits

provided through your policy is deducted monthly in the

form of policy charges, which include an Administrative

Charge, Coverage Charge, Cost of Insurance Charge,

and any applicable rider charges. Additionally, a pre-

mium load is deducted from each premium payment.

To understand how policy charges affect your policy’s

cash value, request a personalized illustration that

includes an Analysis of Charges. Policy charges will

reduce your policy’s effective rate of return.

POLICY SURRENDER CHARGES: If you surrender

your policy within the first 20 policy years, a surrender

charge will apply. A surrender charge will reduce your

policy’s cash value payable at policy surrender.

POLICY FACE AMOUNT CHANGES: You may

increase or decrease the face amount on your policy,

subject to restrictions, which may impact your policy

charges and surrender charges.

NON-GUARANTEED ELEMENTS: Non-guaranteed/

current elements are not guaranteed by definition.

As such, Pacific Life Insurance Company reserves

the right to change or modify any of these elements.

This right to change these elements is not limited to a

specific time or reason.

04

BECAUSE YOUR MONEY COUNTSProtecting your family with life insurance is a long-term commitment.

The type of coverage you choose matters. So does the company

you choose.

For the most affordable premiums, term life insurance is hard to beat.

As the name implies, though, each policy has a set term of coverage.

When the term ends, all the coverage and money paid for it go away.

With Pacific Indexed Protector 2, you may keep your life insurance protection for as long as you need it. Your policy will stay in force as long as your policy’s cash value is sufficient to pay ongoing policy charges.

Unlike term coverage, net premiums for cash value life insurance have

the potential to accumulate and grow. And you may increase or decrease

your premiums based on how much your policy has accumulated.

Flexibility is a hallmark of cash value life insurance coverage.

05

FAMILY

Zero FloatsWhat goes up must come down. Or does it?

Indexed universal life insurance is a form of cash value life insurance. What makes it

different is the way it credits interest to your policy’s cash value if you allocate among

the indexed accounts. Imagine the interest rate your policy credits as a buoy riding

along the waves of stock market movements.

Your policy’s buoy is anchored, meaning it can only float up to a certain point. This

maximum is called the growth cap and it limits your interest crediting rate on the upside.

Your interest rate is guaranteed to be no less than 0%. If the market drops, your cash

value stays where it was, reduced only by policy charges and any distributions you take,

such as withdrawals and policy loans.

With 0% guaranteed, your policy’s cash value is protected against market-based losses.

Indexed accounts do not directly participate in any stock or equity investments, but they

do credit an interest rate based in part on the movements of stock market indexes.

06

THE POTENTIAL TO GROWThe cash value of a Pacific Indexed Protector 2 life insurance policy has the potential to accumulate and grow.

Each premium you pay, net a premium load, is applied to the policy’s

fixed account, where it will earn a current interest rate, less monthly

policy charges.

You may transfer your policy’s accumulated value from the fixed

account to any combination of available indexed accounts on the

15th of each month. Each transfer into an indexed account creates a

unit of value called a segment. Any applicable interest is credited at

the end of each segment’s term, based in part on the performance of

a major stock market index, excluding dividends.

Talk to your life insurance producer about your financial goals and

the accounts that might match your current and long-term needs.

07

FAMILY

Tax Considerations: Loans and Withdrawals

For federal income tax purposes, tax-free income

assumes, among other things: (1) withdrawals do not

exceed tax basis (generally, premiums paid less prior

withdrawals); (2) policy remains in force until death;

(3) withdrawals taken during the first 15 policy years

do not occur at the time of, or during the two years

prior to, any reduction in benefits; and (4) the policy

does not become a modified endowment contract.

See IRC Sections 72, 7702(f)(7)(B), 7702A. Any policy

withdrawals, loans, and loan interest will reduce

policy values and may reduce benefits.

08

ACCESSING YOUR CASH VALUEBecause life is filled with unexpected surprises, wants, and needs, you

may have to access your life insurance policy’s available cash value

through policy loans and withdrawals that are tax-free.

If you are supporting your growing children and your elderly parents,

for example, you may be in the middle of a Sandwich Generation

moment. Financial resources might be tight.

Along with the flexibility to access your policy’s available cash value, if

you die prematurely, your policy’s proceeds payable at your death may

help continue the support you have been providing to your family.

09

FAMILY

Tax Considerations: Policy Proceeds

For federal income tax purposes, life insurance death

benefits generally pay income tax-free to beneficiaries

pursuant to IRC Section 101(a)(1). In certain situations,

however, life insurance death benefits may be partially

or wholly taxable. Situations include, but are not

limited to: the transfer of a life insurance policy for

valuable consideration unless the transfer qualifies

for an exception under IRC Section 101(a)(2) (i.e. the

“transfer-for-value rule”); arrangements that lack

an insurable interest based on state law; and an

employer-owned policy unless the policy qualifies for

an exception under IRC Section 101( j).

10

YOUR POLICY PROCEEDS FOR YOUR FAMILYYour policy’s proceeds are paid tax-free to your policy beneficiaries

when you die. Along with replacing your income, the proceeds might

be used to pay off the family home, satisfy debts, and/or help ensure

efficient estate transfer.

You have three choices for your policy’s payout structure:

A Level Death benefit equals the policy’s face amount.

B IncreasingDeath benefit equals the policy’s face amount,

plus the policy’s accumulated cash value.

C Return of Premium

Death benefit equals the policy’s face

amount plus the sum of premiums paid,

less any withdrawals.

How you structure your policy will affect its charges and surrender

charges, so work with your life insurance producer to build the coverage

that meets your needs.

11

FAMILY

Financial Features

Your policy offers optional features called riders for

additional life insurance and financial needs. Riders

help expand the flexibility and protection of your

policy. Some riders are automatically included with

eligible policies. Other riders must be elected at

policy issue for additional cost.

Ask your life insurance producer to provide you

with more details on the financial features available

to you through riders.

Riders will likely incur additional charges and are

subject to availability, restrictions and limitations.

When considering a rider, request a policy

illustration from your life insurance producer to

see the rider’s impact on your policy’s values.

12

GUARANTEED PROTECTIONWhat good is life insurance coverage if your policy lapses due to insufficient cash

value to pay ongoing policy charges? With Pacific Indexed Protector 2, you can

get guaranteed protection to or beyond life expectancy at competitive premiums.

With the guarantee, you can safeguard your policy against lapse, regardless of policy performance. Simply elect the optional No-Lapse Guarantee Rider at policy issue and choose a guaranteed duration. Your life insurance producer can illustrate the necessary premiums required.

Timing of your premium payments is important. Miss a premium or make a

late payment, and your no-lapse duration may be shortened or negated. If the

no-lapse feature terminates, additional premiums would be required to resume

the no-lapse guarantee and/or policy. If policy loans or withdrawals are taken,

additional premiums may be required to keep the no-lapse guarantee in force.

The No-Lapse Guarantee Rider (Form #R14FNL or ICC14 R14FNL, based on state

of policy issue), depending on how you structure your policy, has a maximum

duration of the insured’s lifetime, subject to certain limits. If your net no-lapse

guarantee value is zero, the no-lapse feature terminates. If the no-lapse feature

terminates, additional premiums would be required to resume the no-lapse

guarantee. If policy performance is such that your policy is being maintained

solely by the no-lapse guarantee, your policy will not build cash value.

13

FAMILY

14

PACIFIC LIFE THE POWER TO HELP YOU SUCCEEDWhen it comes to choosing the company you will trust with the purchase

of your life insurance policy, consider their treatment of the policyowners

who have purchased before you. Pacific Life has a history of passing along

savings to our policyowners in the form of over 120 pricing improvements to

our inforce policies since 1985.

When you buy a policy from Pacific Life, you become a voting member in our

mutual holding company structure. We make decisions that benefit you and

the long-term financial strength of the company.

You matter to us.

Buying life insurance is a long-term commitment. The company you choose matters.

FAMILY

15

16-5 15-44239-00 5/16

This material is not intended to be used, nor can it be used by any taxpayer, for the purpose of avoiding U.S. federal, state or local tax penalties. This material is written to support the promotion or marketing of the transaction(s) or matter(s) addressed by this material. Pacific Life, its affiliates, their distributors and respective representatives do not provide tax, accounting or legal advice. Any taxpayer should seek advice

based on the taxpayer’s particular circumstances from an independent tax advisor or attorney.

Pacific Life Insurance CompanyNewport Beach, CA

(800) 800-7681 • www.PacificLife.com

Pacific Life Insurance Company is licensed to issue insurance products in all states except New York. Product availability and features may vary by state. Insurance products and their guarantees, including optional benefits and any crediting rates, are backed by the financial strength and

claims-paying ability of the issuing insurance company. Look to the strength of the life insurance company with regard to such guarantees as these guarantees are not backed by the broker-dealer, insurance agency, or their affiliates from which products are purchased. Neither these entities nor

their representatives make any representation or assurance regarding the claims-paying ability of the life insurance company.

Pacific Life Insurance Company’s individual life insurance products are marketed exclusively through independent third-party life insurance producers, which may include bank affiliated entities. Some selling entities may limit availability of some optional riders based on their client’s age and other

factors. Your broker-dealer or firm can help you determine which optional riders and investment options are available and appropriate for your clients.

Investment and Insurance Products: Not a Deposit Not Insured by any Federal Government Agency

Not FDIC Insured No Bank Guarantee May Lose Value