Common use of Risk Charge Clause in Contracts

Risk Charge. In calculating unit values, We will deduct a mortality and expense risk charge daily from each variable subaccount which is equal, on an annual basis, to a percentage of the daily net asset value. This percentage is the Annual Mortality and Expense Risk Fee. The deduction is made to compensate Us for assuming the mortality and expense risks under contracts of this type. The Annual Mortality and Expense Risk Fee is equal to the Base M&E Risk Fee plus any fees for certain optional riders. Your Initial Base M&E Risk Fee and Initial Annual M&E Risk Fee is shown under Contract Data. The Base M&E Risk Fee on any Day is based on Your age band and Your size band. The Table of Base M&E Risk Fees, including the age bands and the size bands, is shown under Contract Data. At issue, Your age band is based on Your age as of the Application Date as shown under Contract Data. Your age band will not change for the life of the contract unless there is a “covered life change”. If there is a “covered life change”, Your age band will be reset on that date based on the Attained Age of the Owner.