VARIABLE ANNUITIES The Lincoln Leader

VARIABLE ANNUITIES

The Lincoln Leader

JULY 16, 2021 VOLUME 15, ISSUE 7

Competitive Intelligence update A review of industry sales ? First quarter 2021 (excluding employer markets)

Total Flow Variable Annuity (VA) sales for the industry were $25.95 billion. Below are some highlights from industry VA Sales data:

Industry sales increased 10.2% quarter-over-quarter (QOQ) and 19.9% yearover-year (YOY).

Lincoln maintained the #2 rank in Total Flow VA sales from last quarter.

A review of channel sales ? First quarter 2021 (including employer markets)

Lincoln maintained the #4 rank in the Bank Channel, the #2 rank in the Wire channel and the #2 rank in the IP channel.

Lincoln's Bank sales decreased 1% QOQ and increased 31% YOY. Lincoln's Planner sales increased 14% QOQ and decreased less than 1% YOY. Lincoln's Wire sales increased 16% QOQ and decreased 1% YOY.

Note: This information is not intended for and cannot be used with the public. Information is from public sources deemed reliable (LIMRA). Although every attempt has been made to ensure accuracy, it cannot be guaranteed. Past performance is no guarantee of future results. The Lincoln Competitive Intelligence Unit provides general information on a competitor's annuity products to help producers understand product differences. Keep in mind that products and features are subject to state and firm approvals.

Fund Liquidation Effective July 30, 2021

The Rational Trend Aggregation VA Fund, available only in Lincoln ChoicePlusSM Design products, is liquidating. Any assets in the fund on July 30th will be moved to the LVIP Government Money Market fund.

HEADLINES

Competitive Intelligence update

Fund liquidation

Lincoln Level Advantage? enhancements

Email campaign targets online account access

Fort Wayne Servicing Address Changed

Digital First strategy for contract delivery

Enhancements to online account registrations

5 or 10-year deferral death benefit payout changes

DCA specials

Prospectus supplements

Market conduct manual updated

Reference materials

Forms updates

NAIC Model Reg. updates

Fixed rates

NIGO Tips

Regulatory Roundup

Jul 2021

For financial professional use only. Not for use with the public.

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Lincoln Level Advantage? indexed variable annuity enhancements

Indexed account updates effective July 12, 2021

The following indexed account changes are effective July 12, 2021 on existing contracts. Changes are based on product version, issue state, issue date and crediting method. Annuity owners can allocate their eligible Account Value into these accounts on the next contract anniversary.

Account

1-Year S&P Performance 500 Cap with 15% Protection 1-Year Nasdaq-100? Cap with 15% Protection

1-Year S&P 500 Performance Trigger with Protection

3-Year Participation Rate with 10% Protection 6-Year Performance Cap with 10% Protection

Availability

Now available to in-force contracts in all states (all product versions except B-Class and Advisory Class).

Now available to in-force contracts in all states (all product versions except B-Class and Advisory Class).

15% Protection: Now available to in-force contracts (all product versions except B-Class and Advisory Class); see state restrictions below.

10% Protection: o Now available to in-force contracts in New Jersey and Texas. o Now available to in-force Select and Access product versions in California.

Now available to in-force contracts in Texas. Participation Rate accounts are not available on the B-Class, Advisory Class, or Select product versions.

Now available to in-force B-Class and Advisory Class contracts in all states.

State variations:

Pennsylvania: ? Performance Trigger accounts not available to contracts issued prior to Jan. 11, 2021. ? Participation Rate accounts not available to contracts issued prior to Jan. 11, 2021.

Minnesota ? Performance Trigger accounts not available to contracts issued prior to Oct. 12, 2020.

Email campaign targets clients not yet registered for online account access

Emails being sent to annuity owners to encourage registration

Over the next few months, we will be reaching out to annuity owners (and annuitants of individual custodial accounts) that have not yet registered for online account access. This email campaign will promote online account management, reminding clients that this service is:

Convenient, easy to use and saves time Safe, secure and helps them monitor account activity Paperless and contactless (go green!)

Jul 2021

For financial professional use only. Not for use with the public.

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Reminder: Fort Wayne Servicing Address Changed

Confirm you are using the correct physical address for overnight mail

Please confirm/update your records to reflect the Lincoln servicing address:

Overnight Servicing Address (Updated earlier in the year) Lincoln Financial Group Individual Annuity Operations 1301 South Harrison Street

The regular mailing address has not changed: Lincoln Financial Group P.O. Box 2348 Fort Wayne, IN 46801-2348

Fort Wayne, IN 46802-3425

We are in the process of updating all forms and collateral. During this transition period if the prior address has been used, the mail will still be delivered to Lincoln. Thank you for your attention to this matter.

Digital First strategy for contract delivery

Continuing in July: Phased-in approach for eDelivery of contracts to financial professionals

Lincoln is committed to helping our partners and customers do businesswith usseamlessly. In response to the evolving nature of ourvirtual world, we are rolling out an electronic delivery (eDelivery) requirement for annuities using a phasedin approach, that began in June and is continuing into July.

We hope to have our distribution partners take full advantage of eDelivery of contracts this year.

Lincoln's Digital First strategy provides an efficient method for the new business process and positions us to be more competitive in the marketplace.

Once the Digital First strategy is implemented, the contract delivery method will be determined by the firm's contract delivery preference:

If the firm's contract delivery preference is to have the contract sent to the financial professional, the contract will be sent via eDelivery.

If the firm's contract delivery preference is to have the contract sent to the client, the client would check the box on the application supplement to elect Electronic Transmissions and provide their email address for eDelivery.

For steps and tips on how to get started with eDelivery, check out our flier or watch this video.

If you have any questions, please reach out to your Lincoln representative. Refer to these Talking points for details and instructions.

Jul 2021

For financial professional use only. Not for use with the public.

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Enhancements to the Online Registration Experience on

Use of phone numbers to verify identity beginning July 23, 2021

We are pleased to announce upcoming enhancements to the online registration experience for . Lincoln is phasing in a new telephone-based identity verification process for all consumers and financial professionals who register for access to their accounts on .

A telephone number (for either a landline or cell phone) will be required during the registration process and verified before the registration can be completed. This new identity verification process replaces the use of Knowledge-Based Authentication (KBA) questions, increases security and helps streamline the registration experience.There is no impact to consumers or financial professionals who have already registered for online account access. New users will be prompted to follow the process for anyone registering for account access including employees, customers, producers, consultants, broker-dealers, prospects, plan sponsors and TPAs.

The updated registration screens are shown below, as well as the three quick steps in the identity verification process:

1. The user enters required information, including a phone number. 2. For a cell phone, a text message will be sent that includes a link to verify. For a landline, a call will be made,

and a verification code given. The user will enter the code from the automated-voice message to verify. 3. Once the identity is confirmed, the registration process can be completed.

The information provided will carry over and automatically create a multifactor profile, either text or phone, based on the phone number provided in registration for the user during first and every subsequent login.

If you have questions, review this FAQ document or use the Contact Us page on to contact the correct representative.

5 or 10-year deferral death benefit payout option only allowed for existing Lincoln contracts

New applications will not be accepted after July 23, 2020

The 5 or 10-year deferral death benefit payout options will only be available to beneficiaries of existing Lincoln contracts. Lincoln will no longer offer the 5 or 10-year distribution option if a new application is required.

There is no impact to other deceased contract options.

Any pending business submitted on or prior to July 23rd, must be funded by end of business August 20th, 2021. Electronic order entry systems and forms will be updated to reflect this change effective August 23rd, 2021.

Jul 2021

For financial professional use only. Not for use with the public.

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DCA specials for July

Lincoln Investor Advantage? and Lincoln Investor Advantage? Pro

Available products: B-Share and Pro B-Share Available specials:

6% 6-month special 12% 3-month special

Specials are available for new issues and subsequent payments (sub-pays) into existing contracts in all states that allow the DCA Fixed Account, including New York. In order to be eligible, the following conditions must be met:

For subsequent payments, the oldest owner/annuitant on the contract must be under age 80 at the time of the purchase payment.

Purchase payments that total $5,000,000 or more ($1,000,000 or more with Earnings Optimizer) for all contracts for the same owner and/or annuitant will be subject to Home Office approval.

Lincoln ChoicePlusSM

Available products: Fusion and A-Class Available specials:

3% 6-month special 6% 3-month special

Specials are available for new issues and subsequent payments (sub-pays) into existing contracts in all states that allow the DCA Fixed Account, including New York. In order to be eligible, the following conditions must be met:

The contract must be issued on or after August 26, 2013. The contract cannot have a living benefit rider.

American Legacy?

Available products: Series B-share, Signature 1, Design 1, Target Date Income B-share Available specials:

6% 6-month special

Available products: Fusion and A-Class Available specials:

3% 6-month special 6% 3-month special

Specials are available for new issues and subsequent payments (sub-pays) into existing contracts in all states that allow the DCA Fixed Account, including New York. Available to contracts with or without a living benefit rider.

Rate lock procedures for all DCA specials

Payments must be received at Lincoln's home office by July 30, 2021 4:00 p.m. EST. The following are the rate lock procedures for cash and 1035 exchanges:

Cash: 7-day rate lock ? Money must be received at Lincoln within 7 days from the date the paperwork is received, or from the date of transmission for electronic business.

Applications with 1035 Exchange or Transfer Paperwork: 45-day rate lock ? Money must be received at Lincoln within 45 days from the date the paperwork is received at Lincoln. For electronic business, money must be received within 45 days from the date of transmission.

Recent prospectus supplements

The following supplement(s) are posted on Lincoln websites with the annuity prospectuses. LVIP MFS Blended Mid Cap Managed Volatility Fund ? dated July 1, 2021, providing updates to the portfolio managers.

Jul 2021

For financial professional use only. Not for use with the public.

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