EXHIBIT (d)(i)
SECURITY EQUITY LIFE INSURANCE COMPANY
00 XXXXXXXX XXXX XXXXX
XXXXX 000
XXXXXX, XXX XXXX 00000
(A stock insurance company)
FLEXIBLE PREMIUM VARIABLE
LIFE INSURANCE CONTRACT
NON-PARTICIPATING
SECURITY EQUITY LIFE INSURANCE COMPANY ("SELIC") promises to provide the
benefits described in this Contract. This promise is subject to the terms of
this Contract. It is made in return for the Contract Holder's Application and
payment of the required premiums. This is a legal contract between the Contract
Holder and SELIC. PLEASE READ THIS CONTRACT CAREFULLY.
This Contract takes effect on the Issue Date. It continues, prior to the
Maturity Date, as long as the Net Cash Value is sufficient to pay the Monthly
Charges, as described herein.
FREE LOOK PERIOD
This Contract may be canceled at any time within ten (10) days after it is
received, within ten (10) days after mailing or personal delivery of the Notice
of Withdrawal Right, or within forty-five (45) days after the date of the
Application, whichever is later. If canceled, this Contract must be returned to
the Company at its Home Office. Written notice of cancellation is also needed.
If this Contract is canceled, it will be as though this Contract had never been
issued. Any premium paid will be returned to the Contract Holder minus any
Partial Withdrawals taken and any Contract Loans together with accrued but
unpaid interest on such Contract Loans.
This Contract is governed by the laws of the Governing Jurisdiction (See
Contract Schedule A).
ALL VALUES OR PAYMENTS PROVIDED BY THIS CONTRACT WHEN BASED ON THE INVESTMENT
RESULTS OF A SEPARATE ACCOUNT DIVISION MAY INCREASE OR DECREASE AND ARE NOT
GUARANTEED AS TO DOLLAR AMOUNT. THE AMOUNT AND DURATION OF THE DEATH BENEFIT MAY
BE VARIABLE OR FIXED UNDER CERTAIN CONDITIONS (SEE PART 2, INSURANCE PLAN).
Signed for Security Equity Life Insurance Company
/s/ Xxxxxxx X. Xxxxxx /s/ Xxxxxxx X. Xxxxxx
Xxxxxxx X. Xxxxxx, Secretary Xxxxxxx X. Xxxxxx, President
60006 1294
TABLE OF CONTENTS
Page
Schedule A. General Contract and Insured Information.................................. 60107A
Schedule B. Contract Charges and Fees................................................. 60107B
Schedule C. The Separate Account...................................................... 60107C
Schedule D. Face Amount............................................................... 60107D
Schedule E. Cost of Insurance......................................................... 60107E
Schedule F. Death Benefit Computation................................................. 60107F
Part 1. Definitions................................................................... 602062.01
Part 2. Insurance Plan................................................................ 602062.02
Part 3. Variable Life Insurance Coverage.............................................. 603063.01
Part 4. Premium Payments.............................................................. 603063.02
Part 5. The Separate Account and The Fixed Fund....................................... 604064.01
Part 6. Separate Account Values....................................................... 604064.02
Part 7. Cash Value.................................................................... 605065.01
Part 8. Contract Loans................................................................ 605065.02
Part 9. Partial Withdrawals........................................................... 605065.04
Part 10. Reports to Contract Holder................................................... 606066.01
Part 11. Termination Provisions....................................................... 606066.01
Part 12. General Provisions........................................................... 606066.02
Security Equity Life Insurance Company
00 Xxxxxxxx Xxxx Xxxxx, Xxxxx 000
Xxxxxx, XX 00000
(000) 000-0000
CONTRACT SCHEDULE A
GENERAL CONTRACT AND INSURED INFORMATION
Contract Number: SPECIMEN
Contract Holder: Xxxx Xxx
Contract Date: January 1, 1995
Contract Year: January 1 through December 31
Issue Date: January 1, 1995
Maturity Date: January 1, 2060
Beneficiary Xxxx Xxx
BASIC CONTRACT INFORMATION
Plan: Flexible Premium Variable Life Insurance
Initial Face Amount: $25,000
Death Benefit Option: Option 1
Death Benefit Accumulation Rate: Not Applicable
Loan Interest Rate Option: Fixed Rate
Governing Jurisdiction: NY
Minimum Fixed Fund Crediting Rate: 4.00%
INSURED INFORMATION
Insured: Xxxx Xxx
Date of Birth: 01/01/1960
Sex: Male
Smoker Status: N-S
Social Security Number: 000-00-0000
Residence: 000 Xxxx Xx.
Xxxxxx, XX 00000
Citizenship: U.S.A.
60107A 1.01
CONTRACT SCHEDULE A
GENERAL CONTRACT AND INSURED INFORMATION
(continued)
RIDER INFORMATION
Riders: None
PREMIUM INFORMATION
Initial Premium: $386.84
Initial Net Premium: $259.18
Minimum Subsequent Premium: $50.00
Maximum Subsequent Premium: Not Applicable
If the initial premium and subsequent premiums prove to be too low, insurance
coverage may cease.
60107A 1.02
CONTRACT SCHEDULE A
GENERAL CONTRACT AND INSURED INFORMATION
(continued)
NET PREMIUM ALLOCATION LIMITATIONS
The Contract Holder may direct the allocation of the Net Premium to any Separate
Account Division as described in Contract Schedule C. Allocations must be
specified in percentages that are whole numbers.
The Contract Holder may also allocate Net Premium to the Fixed Fund, subject to
the Maximum Fixed Fund Allocation Percentage. The initial percentage is shown
below. SELIC may change the Maximum Fixed Fund Allocation Percentage at any
time.
Maximum Fixed Fund Allocation Percentage: 100%
During the Free Look Period, however, the allocation of the Net Premium will be
limited to the Money Market Separate Account Division, or a comparable Separate
Account Division investing in short term money market instruments.
PARTIAL WITHDRAWALS
Minimum Withdrawal Amount: $1,000.00
INSURANCE COVERAGE
Settlement Option Interest Rate: 1.00%
BASIS OF COMPUTATIONS
Mortality Table: 1980 Commissioners Standard
Ordinary, S/N-S,
Age Nearest Birthday.
Interest Rate: 4.00%
60107A 1.03
CONTRACT SCHEDULE B
CONTRACT CHARGES AND FEES
Charges displayed in this schedule are the maximum charges under this Contract.
Current charges may be lower than those shown.
PREMIUM LOADS
Premium Loads, consisting of a Distribution Charge, a DAC Tax Charge and a
Premium Tax Charge, are deducted from each premium payment.
Target Premium: $386.84
Distribution Charge:
Premiums paid during Premiums paid during
Contract Year Contract Year
Contract Year Up to Target Premium In Excess of Target Premium
1 30.00% 2.00%
2-10 10.00% 2.00%
11-15 8.00% 2.00%
16+ 4.00% 2.00%
DAC Tax Charge: 1.00% of premiums paid, all Contract Years.
Premium Tax Charge: A charge calculated to approximate the
aggregate of taxes based on premiums received
imposed on the Company by the jurisdiction in
which the Contract Holder resides at the time
the premiums are received.
DAILY CHARGES
Daily charges are deducted from each Separate Account Division.
Mortality and Expense 0.0013665% daily
Risk Charge: (equivalent to 0.50% annually)
60107B 1.01
CONTRACT SCHEDULE B
CONTRACT CHARGES AND FEES
(continued)
Charge for Taxes: SELIC reserves the right to deduct from the
assets of the Separate Account Divisions a
charge equivalent to any federal, state, or
local taxes which it may be required to pay
based on the investment earnings of a
Separate Account Division.
MONTHLY CHARGES
Monthly charges are deducted from the Insurance Account Value.
Administration Charge: $8.00 per month.
Cost of Insurance: See Contract Schedule E.
ANNUAL CHARGES
Annual loan charges are added to the Loan Amount.
Fixed Loan Interest Rate: 6.00% annually in arrears.
Loan Interest Spread: 0.50%
TRANSACTION CHARGES
Transaction Charges are deducted at the time of each transaction.
Transfer Charge: None
Illustrative Report Fee: A reasonable fee may be charged. The amount
of this fee may vary depending on the type
and complexity of the report requested.
However, the fee will not exceed $50.00.
Withdrawal Charge: None
Surrender Charge: None
60107B 1.02
CONTRACT SCHEDULE B
CONTRACT CHARGES AND FEES
(continued)
Other Charges: SELIC reserves the right to deduct from this
Contract's Insurance Account Value an amount
equivalent to any federal, state, or local
taxes or other government charge which SELIC
determines to be properly attributable to
this Contract.
UNDERWRITING CHARGES
Underwriting Charges are deducted on the Issue Date or on the effective date of
an increase in Face Amount, change in Death Benefit Option, or any other
transaction which requires Evidence of Insurability.
Underwriting Charge: $100.00
60107B 1.03
CONTRACT SCHEDULE C
THE SEPARATE ACCOUNT
SEPARATE ACCOUNT INFORMATION
The Separate Account is governed by the laws of New York, the Company's state of
domicile.
The Separate Account Divisions available to the Contract Holder on the Issue
Date are listed in this Schedule. This Schedule may be amended from time to time
to add or delete Separate Account Divisions.
LIMITATION ON TRANSFER
The maximum number of transfers of Insurance Account Value allowed among
Separate Account Divisions and the Fixed Fund per Contract Year is one (1).
OTHER SEPARATE ACCOUNT LIMITATIONS
The maximum number of Separate Account Divisions to which this Contract's
Insurance Account Value may be allocated at any one time is five (5).
60107C 1.01
CONTRACT SCHEDULE C
THE SEPARATE ACCOUNT
(continued)
DIVISIONS INVESTING IN PORTFOLIOS
Each of the Separate Account Divisions listed below invests in shares or units
of a portfolio managed by an investment manager.
General American Capital Company - Money Market Fund
Objective: The highest level of current income consistent with reservation of
capital and maintenance of liquidity.
Strategy: Investing primarily in high-quality, short-term money market
instruments.
Life & Annuity Trust - U.S. Government Allocation Fund
Objective: A high level of total return over the long term, consistent with
reasonable risk.
Strategy: Investment primarily in three maturity classes of U.S. Treasury debt
securities: long-term U.S. Treasury bonds, intermediate-term U.S.
Treasury notes, and short-term money market instruments.
Life & Annuity Trust - Asset Allocation Fund
Objective: Primarily a high rate of long-term total return composed of capital
growth and income payments; secondarily, preservation of capital.
Strategy: Investment in any combination of common stocks, U.S. Treasury bonds
and money market instruments.
VIP - Growth Portfolio
Objective: The achievement of capital appreciation.
Strategy: Purchases of common stocks, although its investments are not
restricted to any one type of security.
60107C 1.02
CONTRACT SCHEDULE C
THE SEPARATE ACCOUNT
(continued)
VIP II - Investment Grade Bond Portfolio
Objective: To seek as high a level of current income as is consistent with the
preservation of capital.
Strategy: Investments in a broad-range of investment-grade, fixed income
securities. The Fund will maintain a dollar-weighted average
portfolio maturity of ten years or less.
VIP II - Asset Manager Portfolio
Objective: To seek a high total return with reduced risk over the long-term.
Strategy: Allocation of assets among domestic and foreign stocks, bonds and
short-term, fixed-income instruments.
VIP II - Index 500 Portfolio
Objective: To seek to provide investment results that correspond to the total
return (i.e. the combination of capital changes and income) of
common stocks publicly traded in the United States.
Strategy: An attempt to duplicate the composition and total return of the
Standard & Poors 500 Composite Stock Price Index while keeping
transaction costs low.
VIP II - Overseas Portfolio
Objective: Seeks long-term growth of capital.
Strategy: Invests mainly in equity securities outside of the United States.
60107C 1.03
CONTRACT SCHEDULE C
THE SEPARATE ACCOUNT
(continued)
VIP - High Income Portfolio
Objective: Seeks high current income.
Strategy: Invests mainly in high-yielding debt securities, with an emphasis on
lower-quality securities.
VIP - Equity Income Portfolio
Objective: Seeks reasonable income. The Fund also considers the potential for
capital appreciation.
Strategy: Invests mainly in income-producing equity securities.
Evergreen VA Fund
Objective: Seeks to achieve capital appreciation.
Strategy: Invests in the securities of little known or relatively small
companies undergoing changes which the Adviser believes will have
favorable consequences. Income will not be a factor in the selection
of portfolio investments.
Evergreen VA Foundation Fund
Objective: Seeks, in order of priority, reasonable income, conservation of
capital and capital appreciation.
Strategy: Invests principally in income-producing common and preferred stocks
and fixed income securities.
60107C 1.04
CONTRACT SCHEDULE C
THE SEPARATE ACCOUNT
(continued)
Evergreen VA Growth and Income Fund
Objective: Seeks to achieve a return composed of capital appreciation in the
values of its shares and current income.
Strategy: Invests in securities of companies that are undervalued in the
marketplace relative to those companies assets, breakup value,
earnings, or potential for earnings growth.
RIF - Multi-Style Equity Fund
Objective: Seeks income and capital growth.
Strategy: Invests principally in equity securities.
RIF - Aggressive Equity Fund
Objective: Seeks capital appreciation by assuming a higher level of volatility.
Strategy: Invests principally in equity securities.
RIF - Non-U.S. Fund
Objective: Seeks favorable total return and additional diversification for
United States investors.
Strategy: Invests primarily in equity securities of U.S. companies.
RIF - Core Bond Fund
Objective: Seeks to maximize total return through capital appreciation and
income by assuming a level of volatility consistent with the broad
fixed-income market.
Strategy: Invests primarily in fixed-income securities.
60107C 1.05
CONTRACT SCHEDULE C
THE SEPARATE ACCOUNT
(continued)
VIP II - Contrafund Portfolio
Objective: Seeks capital appreciation.
Strategy: Invests mainly in equity securities of companies that are
undervalued or out of favor.
Xxxxx Xxxxx Series - Balanced Portfolio
Objective: Seeks long-term growth consistent with preservation of capital and
balanced by current income.
Strategy: Invests in a diversified portfolio that generally invest 40-60% in
assets selected primarily for their growth potential and 40-60% in
assets selected primarily for their income potential.
Xxxxx Xxxxx Series - Growth Portfolio
Objective: Seeks long-term growth consistent with preservation of capital.
Strategy: Invests primarily in an diversified portfolio of common stocks of
companies of any size.
Xxxxx Xxxxx Series - Worldwide Growth Portfolio
Objective: Seeks long-term growth consistent with preservation of capital.
Strategy: Invests primarily in a diversified portfolio of foreign and domestic
issuers.
VIP III - Balanced Portfolio
Objective: Seeks to provide income and growth of capital.
Strategy: Invests in a diversified portfolio of stocks and bonds.
60107C 1.06
CONTRACT SCHEDULE D
FACE AMOUNT
Minimum Insurance Coverage: $25,000
Maximum Insurance Coverage: Subject to underwriting.
The Insurance Coverage is equal to the Face Amount plus any insurance coverage
provided by Rider.
Increases in Insurance Coverage will require Evidence of Insurability. Increases
will be subject to an Underwriting Charge as shown in Contract Schedule B.
60107D 1.01
CONTRACT SCHEDULE E
COST OF INSURANCE
The maximum monthly Cost of Insurance rates are for each $1,000 of Net Amount at
Risk. Current charges may be lower than those shown.
CONTRACT COST OF CONTRACT COST OF
YEAR INSURANCE RATE YEAR INSURANCE RATE
1 0.14094 41 5.03724
2 0.14762 42 5.59039
3 0.15680 43 6.17549
4 0.16682 44 6.78686
5 0.17851 45 7.44038
6 0.19103 46 8.16249
7 0.20607 47 8.97320
8 0.22110 48 9.89813
9 0.23865 49 10.95204
10 0.25619 50 12.11846
11 0.27709 51 13.37460
12 0.29966 52 14.69860
13 0.32391 53 16.08129
14 0.34984 54 17.49682
15 0.37912 55 18.96601
16 0.41009 56 20.51212
17 0.44693 57 22.16549
18 0.48965 58 23.98724
19 0.53742 59 26.06643
20 0.59276 60 28.78427
21 0.65401 61 32.81758
22 0.72203 62 39.64294
23 0.79429 63 53.06605
24 0.87251 64 83.33333
25 0.96090 65 83.33333
26 1.05949
27 1.16916
28 1.29417
29 1.43714
30 1.59899
31 1.77812
32 1.97123
33 2.18097
34 2.40660
35 2.65338
36 2.93268
37 3.30181
38 3.61779
39 4.04199
40 4.52073
60107E 1.01
CONTRACT SCHEDULE F
DEATH BENEFIT COMPUTATION
TABLE OF MINIMUM DEATH BENEFIT FACTORS
CONTRACT MINIMUM DEATH CONTRACT MINIMUM DEATH
YEAR BENEFIT FACTOR YEAR BENEFIT FACTOR
1 4.38 41 1.40
2 4.24 42 1.38
3 4.10 43 1.35
4 3.96 44 1.33
5 3.83 45 1.31
6 3.70 46 1.29
7 3.58 47 1.27
8 3.47 48 1.26
9 3.35 49 1.24
10 3.24 50 1.23
11 3.14 51 1.21
12 3.04 52 1.20
13 2.94 53 1.19
14 2.85 54 1.18
15 2.76 55 1.17
16 2.68 56 1.16
17 2.59 57 1.15
18 2.51 58 1.14
19 2.44 59 1.12
20 2.36 60 1.11
21 2.29 61 1.10
22 2.23 62 1.09
23 2.16 63 1.07
24 2.10 64 1.06
25 2.04 65 1.04
26 1.99
27 1.93
28 1.88
29 1.83
30 1.79
31 1.74
32 1.70
33 1.66
34 1.62
35 1.58
36 1.55
37 1.52
38 1.48
39 1.45
40 1.43
60107F 1.01
PART 1. DEFINITIONS
As used in this Contract the following terms have the meanings defined in this
Part.
ATTAINED AGE: The Issue Age plus the number of completed Contract Years.
BENEFICIARY: Any person or entity named on the Company's records to receive the
insurance proceeds after the Insured dies.
BORROWED FUND: An account established in XXXXX's general account for any amounts
transferred from the Separate Account Divisions and the Fixed Fund as a result
of loans. The account is credited with interest that is not based on the
experience of any Separate Account Division.
COMPANY: Security Equity Life Insurance Company, the issuer of this Contract.
CONTRACT ANNIVERSARY: The day which marks the start of a new Contract Year.
CONTRACT DATE: The date used to begin calculating Monthly Charges and Annual
Charges under this Contract. The Contract Date is shown in Contract Schedule A.
CONTRACT HOLDER: The owner of this Contract, as shown in the records of SELIC.
All of the rights and benefits of this Contract belong to the Contract Holder,
unless otherwise stated herein.
CONTRACT MONTH: This term is used for calculating Monthly Charges under this
Contract. Computation of Contract Months starts with the Contract Date.
CONTRACT YEAR: Each successive twelve month period starting on the Contract
Date.
FACE AMOUNT: The amount of insurance under this Contract, excluding any coverage
provided by riders. The Initial Face Amount is shown in Contract Schedule A.
Thereafter, it may change in accordance with the provisions of Part 2, Insurance
Plan and Part 9, Partial Withdrawals.
FIXED FUND: The portion of the Insurance Account Value allocated to SELIC's
general account (excluding amounts in the Borrowed Fund). This amount is
credited with interest that is not based on the experience of the Separate
Account Divisions.
GOVERNING JURISDICTION: The state or jurisdiction in which this Contract is
delivered and whose laws govern its terms.
HOME OFFICE: The principal administrative office of Security Equity Life
Insurance Company at 00 Xxxxxxxx Xxxx Xxxxx, Xxxxx 000, Xxxxxx, Xxx Xxxx 00000.
INSURANCE ACCOUNT: An accounting record kept for the purpose of tracking the
premiums and other values used to determine insurance coverage and other
benefits under this Contract.
INSURED: The person whose life is insured under the terms of this Contract. The
Insured is shown in Contract Schedule A.
60206 2.01 1294
ISSUE AGE: The Insured's age at his or her nearest birthday as of the Contract
Date.
ISSUE DATE: The day the first premium is received and accepted by the Company.
This is also the date insurance coverage becomes effective. All Contract values
based on a Separate Account Division are determined beginning on the Issue Date.
MATURITY DATE: The date on which this Contract will mature. The Maturity Date is
shown in Contract Schedule A.
MONTHIVERSARY: The first day of each Contract Month. The day Monthly Charges are
deducted from the Insurance Account Value. It is the same day of each succeeding
month as the Contract Date except that whenever the Monthiversary falls on a day
other than a Valuation Day it is deemed to be the next Valuation Day. If any
Monthiversary would be the 29th, 30th or 31st of a month that does not have that
number of days, then the Monthiversary will be the last day of that month.
MONTHLY CHARGES: The charges that are deducted monthly from the Insurance
Account Value (see Part 7, Cash Value).
NET AMOUNT AT RISK: The Net Amount At Risk is calculated on any Monthiversary by
subtracting the Insurance Account Value from the Death Benefit discounted to
such Monthiversary at the interest rate specified in Contract Schedule A, under
Basis of Computations.
SEPARATE ACCOUNT: An account which has been established by SELIC to separate the
assets funding the variable benefits for the class of contracts to which this
Contract belongs, and other contracts funded through the Separate Account, from
the other assets of SELIC.
SEPARATE ACCOUNT DIVISION: The subdivisions of the Separate Account. Each
Separate Account Division invests in a single corresponding underlying
portfolio.
S.E.C.: The United States Securities and Exchange Commission.
SELIC: Security Equity Life Insurance Company, the issuer of this Contract, also
referred to as the "Company".
PART 2. INSURANCE PLAN
This Contract provides insurance coverage on the life of the Insured. The
Insured is named in Contract Schedule A.
DEATH BENEFIT
If the Insured dies while this Contract is in force, a Death Benefit is payable
to the Beneficiary when XXXXX receives due proof of death. The amount of the
Death Benefit payable is equal to the Death Benefit determined on the date of
the Insured's death. This amount depends on the Face Amount and the Death
Benefit Option selected by the Contract Holder and shown in Contract Schedule A.
The amount of the Death Benefit payable is also adjusted as follows:
(1) by deducting the amount of any unpaid Monthly Charges against the
Insurance Account Value to the date of death; and
(2) by deducting the amount of any Contract Loans outstanding against the
Insurance Account Value on the date of death plus interest accrued but
unpaid on such Contract Loans on the date of death; and
(3) by deducting the amount of any unpaid charges for benefits provided by
Xxxxx, if any.
60206 2.02 1294
DEATH BENEFIT OPTIONS
There are three Death Benefit Options, described below. The Death Benefit Option
for this Contract on the Issue Date is shown in Contract Schedule A.
Option 1: Under Death Benefit Option 1, the Death Benefit on any date is
equal to the Face Amount in effect on that date.
Option 2: Under Death Benefit Option 2, the Death Benefit on any date is
equal to the Face Amount in effect on that date plus the
Insurance Account Value on that date.
Option 3: Under Death Benefit Option 3, the Death Benefit on any date is
equal to the Face Amount in effect on that date, plus the
accumulated premiums paid under this Contract up to such date. In
calculating the Death Benefit under this option, premiums are
accumulated from the date the premium was credited to the
Insurance Account Value to the date the Death Benefit is being
determined at the Death Benefit Accumulation Rate shown in
Contract Schedule A.
MINIMUM DEATH BENEFIT
To ensure that the Contract will qualify as life insurance under the Internal
Revenue Code, the Death Benefit will never be less than the Minimum Death
Benefit. The Minimum Death Benefit on any date is equal to the Insurance Account
Value on that date multiplied by the appropriate Minimum Death Benefit Factor. A
table of Minimum Death Benefit Factors is included in Contract Schedule F.
FACE AMOUNT
Unless otherwise agreed, the Face Amount for this Contract may not be greater
than that determined according to Contract Schedule D. The Face Amount on the
Issue Date is shown in Contract Schedule A. Contract Schedule A will be updated
from time to time as the information contained therein is changed.
CHANGING THE FACE AMOUNT
The Contract Holder may, subject to approval of the Company, change the Face
Amount. The Contract Holder must request any change not specified in Contract
Schedule D by notifying the Company in writing. Evidence of Insurability may be
required. If SELIC approves the change, it will take effect on the next
Monthiversary which is at least thirty (30) days after all the required
information has been provided to SELIC. The Contract will be amended to show the
effective date of any such change in Face Amount. Any limitations on the number
and/or amount of such changes are shown in Contract Schedule D. Cost of
Insurance amounts charged to the Insurance Account Value will be adjusted to
provide for the change. No change in Face Amount will be effective if the
Insured dies before the effective date of such change.
CHANGING THE DEATH BENEFIT OPTION
The Death Benefit Option for this Contract may be changed while this Contract is
in effect. The Contract Holder must request the change by notifying the Company
in writing. Evidence of Insurability may be required. If SELIC approves the
change, it will take effect on the next Contract Anniversary which is at least
thirty (30) days after all the required information has been provided to SELIC.
The Contract will be amended to show the effective date of any change in Death
Benefit Option. The Cost of Insurance amounts will be adjusted to provide for
the change. No change in Death Benefit Option will be effective if the Insured
dies before the effective date of such change.
60206 2.03 1294
PART 3. VARIABLE LIFE INSURANCE COVERAGE
TIME OF PAYMENT OF DEATH BENEFIT
A Death Benefit will usually be paid within seven (7) days of the date due proof
of the Insured's death is received by XXXXX at its Home Office and any other
requirements are satisfied. Payment of any amount of Death Benefit based upon
the experience of any Separate Account Division may be delayed, however, during
any period that:
(1) The New York Stock Exchange (or its successor, or, if the securities in
which the assets of a Separate Account are invested are not traded on the
New York Stock Exchange, any principal exchange on which such securities
are traded) is closed, or trading is restricted; or
(2) The S.E.C. determines that a state of emergency exists.
Settlement of any amounts not based upon the experience of a Separate Account
Division will be made not more than six (6) months after due proof of death is
received.
INTEREST ON DEATH BENEFITS
Interest on Death Benefits will be credited as prescribed by law.
SETTLEMENT OPTIONS
If payment is deferred by a separate written agreement with the Contract Holder
or Beneficiary, the rate of interest credited will be at least the Settlement
Option Interest Rate shown in Contract Schedule A.
BENEFICIARY
The Contract Holder may name or change a Beneficiary by sending written notice
to the Company. The designation of a Beneficiary may be revocable or
irrevocable. An Irrevocable Beneficiary may not be changed without his or her
consent. Also an Irrevocable Beneficiary must consent to the exercise of certain
other rights by the Contract Holder. There may be different classes of
Beneficiaries, such as primary and secondary. These classes set the order of
payments. There may be more than one Beneficiary in a class. The Beneficiary
designation in effect on the Issue Date is stated in the Application for this
Contract and in any related documents which are attached to and made a part of
this Contract.
SUICIDE EXCLUSION
If the Insured commits suicide, while sane or insane, within two years from the
date coverage becomes effective under this Contract, only a limited Death
Benefit will be payable. In such case, the amount of the Death Benefit will be
equal to the amount of the Net Premiums less any Partial Withdrawals and
Contract Loans and any loan interest accrued but unpaid.
If, after the expiration of the two year period described above, the Insured
commits suicide within two years from the date of receipt of any Subsequent
Premium payment which increases the amount of the Death Benefit, or any change
of Face Amount or change of Death Benefit Option which increases the amount of
the Death Benefit, the amount of the increase in the Death Benefit will be
limited to a refund of the Cost of Insurance charges made for such increase.
60306 3.01 1294
PART 4. PREMIUM PAYMENTS
A. PREMIUM PAYMENTS GENERALLY
The Contract Holder may make premium payments at any time, subject to
limitations described in this Contract. All premiums are payable to SELIC at its
Home Office. All funds received by the Company will be credited to this Contract
as a premium payment unless clearly marked otherwise.
PREMIUM LIMITATION
If premiums are received which would cause the Contract to fail to meet the
definition of a life insurance contract in accordance with the Internal Revenue
Code, SELIC will refund the excess premium payments Such premium payments will
be refunded with interest within 60 days after the end of a Contract Year. Any
maximum premium limitations on the Issue Date are shown in Contract Schedule A.
PREMIUM LOADS
Any Premium Loads shown in Contract Schedule B are deducted from premiums
received by SELIC prior to allocation to the Separate Account Division. Premium
Loads include the Distribution Charge, DAC Tax Charge, and Premium Tax Charge.
NET PREMIUMS
A Net Premium is any premium SELIC receives minus any Premium Loads.
INITIAL PREMIUM
The Initial Premium received and accepted by the Company on the Issue Date is
shown in Contract Schedule A.
INITIAL NET PREMIUM
The Initial Net Premium for this Contract is stated in Contract Schedule A.
MINIMUM NET PREMIUM
The Minimum Net Premium at any time is equal to twelve (12) times the first
Monthly Charges for the current Contract Year.
SUBSEQUENT PREMIUMS
Each premium payment made after the Initial Premium has been paid is known as a
Subsequent Premium payment. Subsequent Premium payments may be made on any
Valuation Day and in any amount, subject to any maximum and minimum premium
limitations shown in Contract Schedule A.
CONTINUATION OF INSURANCE
This Contract does not terminate automatically for failure to pay Subsequent
Premiums. If all premium payments cease, the insurance coverage provided under
this Contract, including benefits provided by any Rider attached to this
Contract, will continue, prior to the Maturity Date, in accordance with the
provisions of this Contract for as long as the Net Cash Value is sufficient to
cover the Monthly Charges.
PREMIUM PAYMENT TO PREVENT LAPSE
Whenever this Contract is in danger of lapsing because the Net Cash Value is
insufficient to pay the Monthly Charges, the amount of premium required to
prevent lapse is equal to three (3) times the Monthly Charges then due plus any
applicable Premium Loads.
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PREMIUM PAYMENTS TO REINSTATE INSURANCE COVERAGE
When insurance coverage has lapsed due to insufficient Net Cash Value, the
amount of premium required to reinstate the insurance coverage is equal to:
(a) the Monthly Charges due and unpaid at the time of lapse; plus
(b) three (3) times the Monthly Charges due at the time of Reinstatement; plus
(c) any applicable Premium Loads.
PREMIUM NOTICES
Notices of any premium payments necessary to prevent lapse of insurance coverage
or to reinstate insurance coverage will be sent to the Contract Holder.
B. ALLOCATION OF NET PREMIUMS TO THE FIXED FUND AND THE SEPARATE ACCOUNT
DIVISIONS
Net Premiums are allocated to or among the Fixed Fund and the Separate Account
Divisions in accordance with the Contract Holder's instructions, subject to the
Net Premium Allocation Limitations stated in Contract Schedule A, and further
subject to any limitations stated in Contract Schedule C. If no instructions are
received from the Contract Holder with a premium payment, such Net Premiums will
be allocated to the Fixed Fund and the Separate Account Divisions in the same
proportions as stated in the most recent recorded instructions received from the
Contract Holder.
TIMING
Net Premiums received prior to the Valuation Time on any Valuation Day will be
allocated as of the date they are received. Net Premiums received after such
time will be allocated on the next Valuation Day.
DURING FREE LOOK PERIOD
Any Net Premiums received prior to the end of the Free Look Period will be
allocated to the Money Market Division (or an equivalent Separate Account
Division which invests in short term money market instruments). At the end of
such period, the Net Cash Value may, at the direction of the Contract Holder, be
allocated to the Fixed Fund and any Separate Account Divisions then available.
No allocation instructions received from the Contract Holder during the Free
Look Period will be acted upon unless the Company has received written evidence
from the Contract Holder indicating that the Free Look Period has expired.
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PART 5. THE SEPARATE ACCOUNT AND THE FIXED FUND
Subject to the conditions set forth in this Part, the Contract Holder has the
right to allocate and re-allocate the Insurance Account Value of this Contract
among the Separate Account Divisions on any Valuation Day. Transfers to and from
the Fixed Fund are also allowed, subject to the limitations described in this
Part 5.
THE SEPARATE ACCOUNT
The assets in the Separate Account are kept segregated from the general account
of the Company and from any other separate accounts of the Company. XXXXX owns
the assets of the Separate Account. Those assets will only be used to support
variable life insurance policies and for any other purposes permitted by
applicable laws and regulations. The portion of the assets of the Separate
Account equal to the reserves and other policy liabilities with respect to the
Separate Account will not be charged with liabilities that arise from any other
business SELIC may conduct. SELIC may, however, transfer from the Separate
Account to its general account assets that exceed the reserves and other policy
liabilities with respect to the Separate Account. Income, gains, and losses,
whether or not realized, from the Separate Account are credited to or charged
against the Separate Account without regard to the income, gains, or losses of
any other separate account and without regard to any of XXXXX's other income,
gains, or losses.
SELIC reserves the right to operate the Separate Account as a management
investment company or unit investment trust registered under the Investment
Company Act of 1940 or in any other form permitted by law.
TRANSFERS
Transfers must be requested by the Contract Holder in a form acceptable to the
Company. The Company reserves the right to limit the amount of any transfer. The
maximum number of transfers per Contract Year is shown in Contract Schedule C.
Written confirmation of each transfer will be sent to the Contract Holder.
Transfers between or among Separate Account Divisions may be made on any
Valuation Day (see, however, Availability of Funds, in Part 12, General
Provisions). Transfers involving the Fixed Fund are subject to additional
restrictions set forth below.
TRANSFERS INVOLVING THE FIXED FUND
Transfers to the Fixed Fund from the Separate Account Divisions may be made on
any Valuation Day. However, after any transfer of amounts to the Fixed Fund, the
amount in the Fixed Fund immediately after the transfer may not exceed the Net
Cash Value times the Fixed Fund Maximum Allocation Percentage. The Fixed Fund
Maximum Allocation Percentage is shown in Contract Schedule A.
Transfers from the Fixed Fund are subject to the following restrictions:
(a) the transfer must occur during the 30 day period following each Contract
Anniversary; and
(b) the amount transferred may be no larger than 25% of the amount in the Fixed
Fund on the date of the transfer; and
(c) only one (1) transfer from the Fixed Fund per Contract Year is allowed.
INVESTMENTS OF THE SEPARATE ACCOUNT DIVISION
The Separate Account Divisions may invest their assets in shares or units of
portfolios managed by one or more investment managers. Investment managers are
selected by the Company in its discretion.
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FIXED FUND INTEREST
Interest will be credited to amounts in the Fixed Fund at rates determined by
SELIC. The effective annual rate is guaranteed not to be less than the Minimum
Fixed Fund Crediting Rate shown in Contract Schedule A. The interest credited
will reflect the timing and amounts added to or withdrawn from the Fixed Fund.
SELIC may, in its sole discretion, establish a higher rate of interest to be
credited to some or all of the Insurance Account Value allocated to the Fixed
Fund, although it is not obligated to do so.
CHANGES IN THE SEPARATE ACCOUNT DIVISIONS
XXXXX has the right to establish additional Separate Account Divisions and to
establish other investment options, from time to time. For any Separate Account
Division, XXXXX has the right to substitute a new portfolio for the portfolio in
which the Separate Account Division invests, to substitute new Separate Account
Divisions, to combine two or more Separate Account Divisions, to cause a
Separate Account Division that is managed directly by an investment manager to
instead invest its assets in shares or units of portfolios managed by one or
more investment managers, to cause a Separate Account Division that invests its
assets in shares or units of a portfolio to instead be managed directly by an
investment manager, and to eliminate any existing Separate Account Divisions or
any other investment option. Subject to any required regulatory approvals, SELIC
reserves the right to transfer assets of a Separate Account Division to another
Separate Account Division which SELIC determines to be associated with the class
of contracts to which this Contract belongs.
Also, subject to the approval of the Superintendent of the New York State
Insurance Department, SELIC has the right to change the investment policy of any
Separate Account Division. If required, the process for obtaining approval of a
material change from the New York Superintendent of Insurance will be filed with
the insurance supervisory official of the Governing Jurisdiction. SELIC will
notify the Contract Holder if any material change of investment policy is
approved.
PART 6. SEPARATE ACCOUNT VALUES
VALUATION DAY
The Valuation Day is a day the New York Stock Exchange (or its successor) is
open for trading and the S.E.C. has not restricted trading or declared an
emergency, except for normal business holidays. Each Valuation Day ends at the
Valuation Time.
VALUATION TIME
Valuation Time is the close of trading on the New York Stock Exchange (or any
successor exchange) or, if the securities in which the assets of a Separate
Account Division are invested are not traded on the New York Stock Exchange, the
close of trading on any exchange on which such securities are traded.
VALUATION PERIOD
The Valuation Period is the period of time between Valuation Times. The
Valuation Period begins as of the end of the previous Valuation Day.
ACCUMULATION UNITS
Accumulation Units are used to measure the Insurance Account Value allocated to
each Separate Account Division. The value of a unit is determined as of the
Valuation Time on each Valuation Day. The value of any unit will vary from
Valuation Day to Valuation Day to reflect the investment performance of the
Separate Account Division applicable to that unit and the deduction of daily
charges.
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SELIC reserves the right to split or consolidate the number of Accumulation
Units credited to this Contract with a corresponding increase or decrease in the
unit values. SELIC may exercise this right whenever it considers an adjustment
of units to be desirable. Strict equity will be preserved, however, in making
any adjustment. No adjustment will have any material effect on the benefits,
provisions, or investment return of this Contract, or on the Contract Holder,
Insured, any Beneficiary, any assignee or other person, or on the Company.
ACCUMULATION UNIT VALUE
The value of an Accumulation Unit in each Separate Account Division is $1.00 on
the first Valuation Day for that Separate Account Division. The value of any
Accumulation Unit on any subsequent Valuation Day is equal to its value on the
preceding Valuation Day multiplied by the Net Investment Factor for that
Separate Account Division for the Valuation Period.
NET INVESTMENT FACTOR
The Net Investment Factor is determined for each Separate Account Division for
each Valuation Period. The Net Investment Factor equals the Gross Investment
Rate for such period plus 1.0 and minus the Mortality and Expense Risk Charge.
GROSS INVESTMENT RATE
The Gross Investment Rate of a Separate Account Division for any Valuation
Period is equal to the Net Earnings of that Separate Account Division during the
Valuation Period divided by the value of the total assets of that Separate
Account Division at the beginning of the Valuation Period.
NET EARNINGS
The Net Earnings of each Separate Account Division are equal to the accrued net
investment income and capital gains and losses (realized and unrealized) of that
Separate Account Division, reduced by any amount charged against that Separate
Account Division for taxes paid or reserved by SELIC.
The Gross Investment Rate and Net Earnings of each Separate Account Division
will be determined by SELIC in accordance with generally accepted accounting
principles and applicable laws, rules, and regulations.
MORTALITY AND EXPENSE RISK CHARGE
The Mortality and Expense Risk Charge is deducted daily from each Separate
Account Division. The maximum charge is stated in Contract Schedule B.
CREDITING AND CANCELING ACCUMULATION UNITS
Transactions which require the crediting and canceling of Accumulation Units
will be made as of the Valuation Time on the Valuation Day in which the
transaction is effected. Premium payments and requests for loans, withdrawals,
transfers, etc. received after the Valuation Time will be effective on the next
Valuation Day.
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PART 7. CASH VALUE
A. CONTRACT VALUES
INSURANCE ACCOUNT VALUE
The Insurance Account Value on the Issue Date is equal to the Net Premium
invested in the Separate Account and the Fixed Fund, less:
(a) Cost of Insurance Charges; and
(b) Administration Charges; and
(c) any Underwriting Charges; and
(d) any Rider Charges deducted from the Insurance Account Value; and
(e) any Charges for Special Insurance Class Rating; and
(f) any other charges as stated in Contract Schedule B.
The Insurance Account Value on any subsequent Valuation Day is equal to the
Insurance Account Value on the prior Valuation Day plus:
(a) any new Net Premium invested in the Separate Account and the Fixed Fund;
and
(b) any increase in value of the Separate Account investments of such Insurance
Account due to investment results (net of Daily Charges); and
(c) any interest credited to the Fixed Fund; and
(d) any interest credited to the Borrowed Fund; and
less:
(a) any decrease in value of the Separate Account investments due to investment
results (net of Daily Charges); and
(b) Cost of Insurance Charges (deducted only on Monthiversary); and
(c) Administration Charges (deducted only on Monthiversary); and
(d) any Partial Withdrawals taken; and
(e) any Rider Charges deducted from the Insurance Account Value; and
(f) any Underwriting Charges; and
(g) any Charges for Special Insurance Class Rating; and
(h) any other charges as stated in Contract Schedule B.
NET CASH VALUE
Net Cash Value is the Insurance Account Value minus any Contract Loan balance
and accrued unpaid interest.
B. CHARGES DEDUCTED FROM THE INSURANCE ACCOUNT VALUE
The following charges may be deducted from the Insurance Account Value that is
invested in the Separate Account and the Fixed Fund. These charges are deducted
pro-rata from the Fixed Fund and each Separate Account Division.
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COST OF INSURANCE
Cost of Insurance Charges are deducted from the Insurance Account Value on each
Monthiversary. Guaranteed Cost of Insurance Charges are determined by
multiplying the applicable cost of insurance rates from the table or tables in
Contract Schedule E times the Net Amount At Risk calculated as of the last day
of the prior Contract Month. Current Cost of Insurance Charges may be lower.
ADMINISTRATION CHARGE
Administration Charges are deducted from the Insurance Account Value on each
Monthiversary. The maximum Administration Charge is stated in Contract Schedule
X.
XXXXX CHARGES
Charges for Riders, if any, deducted from the Insurance Account Value are shown
in the Contract Schedules for such Riders.
UNDERWRITING CHARGES
Underwriting Charges may apply at issue and upon increases in Face Amount and
changes in Death Benefit Option. These charges are deducted at issue or at the
time of the increase in Face Amount, change in Death Benefit Option or any other
transaction which requires Evidence of Insurability. Any Underwriting Charges
are shown in Contract Schedule B.
CHARGES FOR SPECIAL INSURANCE CLASS RATING
Charges may apply if there is a Special Insurance Class Rating. These charges
are deducted from the Insurance Account Value on each Monthiversary. If any
charges apply, they are shown in Contract Schedule B.
PART 8. CONTRACT LOANS
CONTRACT LOANS
The Contract Holder may request a loan against this Contract. This Contract must
be assigned to the Company as sole security for the loan. A loan may be made on
any Valuation Day. An amount equal to the amount borrowed will be transferred
from the Separate Account and the Fixed Fund to the Borrowed Fund of the general
account. Any such transfer is made by canceling Accumulation Units in the
Separate Account Division and applying the value of those units to the Borrowed
Fund and by reducing the Insurance Account Value attributable to the Fixed Fund.
Unless other specific instructions are received from the Contract Holder, the
loan will be taken from the Separate Account Divisions and the Fixed Fund in
proportion to the amount of the Contract Holder's then-current Insurance Account
Value in each Separate Account Division and the Fixed Fund.
MAXIMUM LOAN
The Maximum Loan amount for this Contract is equal to the Insurance Account
Value less the sum of the following:
(a) outstanding loan amount together with unpaid accrued loan interest; and
(b) the Minimum Net Premium for the current Contract Year; and
(c) loan interest charges until the next Contract Anniversary.
BORROWED FUND
The Borrowed Fund is a portion of the Company's general account reserved for
amounts held as collateral for Contract Loans. The initial amount of the
Borrowed Fund will be equal to any loan principal. Interest will be credited to
the Borrowed Fund at the Borrowed Fund Crediting Rate described below.
60506 5.02 1294
Interest credited to the Borrowed Fund during the previous Contract Year will be
transferred to the Fixed Fund and the Separate Account Divisions on each
Contract Anniversary. The amount so transferred will be allocated among the
Fixed Fund and the Separate Account Divisions in proportion to the Insurance
Account Value in the Fixed Fund and each Separate Account Division.
Amounts of loan interest accrued against the loan principal and unpaid on each
Contract Anniversary will be added to the amount of the loan principal. An
amount equal to the unpaid interest will be transferred from the Fixed Fund and
the Separate Account Divisions to the Borrowed Fund on the Contract Anniversary.
This amount will be transferred from the Fixed Fund and the Separate Account
Divisions in proportion to the Insurance Account Value in the Fixed Fund and
each Separate Account Division.
BORROWED FUND CREDITING RATE
Interest credited to amounts held in the Borrowed Fund as collateral for loans
will be at a rate at least equal to the rate stated under "Basis of
Computations" in Contract Schedule A. Interest will be credited such that the
Borrowed Fund Crediting Rate is always equal to the Loan Interest Rate less the
Loan Interest Spread stated in Contract Schedule B. The Borrowed Fund Crediting
Rate may not be changed more frequently than annually. Any change in the
Borrowed Fund Crediting Rate for this Contract will be effective on a Contract
Anniversary. The Contract Holder will be notified of any such change.
LOAN INTEREST RATE
Either a fixed loan interest rate option or a variable loan interest rate option
may be elected. The Loan Interest Rate Option may be changed by the Contract
Holder on any Contract Anniversary, upon written notice in a form acceptable to
the Company. Such notice must be received at the Home Office of the Company no
more than ninety (90) days nor less than thirty (30) days prior to such Contract
Anniversary. Contract Schedule A will be updated to reflect any changes in the
Loan Interest Rate Option.
The current Loan Interest Rate will be applied to the entire outstanding loan
balance.
The variable Loan Interest Rate will be determined by the Company on each
Contract Anniversary. It will never exceed the maximum loan interest rate
permitted by the law of the Governing Jurisdiction. SELIC will determine the
variable Loan Interest Rate by using the greater of: (a) the Published Monthly
Average for the calendar month ending two months before the beginning of the
month in which the Contract Anniversary falls, or in which falls the
Monthiversary immediately prior to the Contract Anniversary; and (b) the
interest rate shown in Contract Schedule A under Basis of Computations plus the
Loan Interest Spread.
The Published Monthly Average means Moody's Corporate Bond Yield Average -
Monthly Average Corporates, as published by Xxxxx'x Investors Service, Inc. or
by any successor to that service (or if that average is no longer published, a
like average set by the insurance regulatory official for the Governing
Jurisdiction). The Loan Interest Spread is shown in Contract Schedule B.
If the maximum variable Loan Interest Rate for a Contract Year is at least 1/2
of 1% higher than the rate set for the previous Contract Year, the rate may be
increased to the maximum. If the maximum variable Loan Interest Rate for a
Contract Year is at least 1/2 of 1% lower than the rate set for the previous
Contract Year, the rate will be reduced to the maximum.
Interest is due annually in arrears, or if earlier, the date of termination of
this Contract or the date that the loan is repaid in full. Any unpaid interest
on any outstanding loans will be added to the outstanding loan amount as of the
Contract Anniversary.
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If loan repayments are not made when the outstanding loan and loan interest due
would exceed the Insurance Account Value, then the Contract will terminate,
subject to the Grace Period provision (see Part 11, Termination Provisions,
Grace Period and Termination).
REPAYMENT OF LOAN
All or part of any Contract Loan plus accrued interest may be paid at any time
while this Contract is in force.
Any repayment of a Contract Loan will result in the transfer of values equal to
the repayment out of the Borrowed Fund and the application of those values to
the Fixed Fund and the Separate Account Divisions as a Net Premium payment.
Unless other specific instructions are received from the Contract Holder, these
values will be allocated to the Fixed Fund and the Separate Account Divisions in
proportion to the amount of the Contract Holder's current Insurance Account
Value in the Fixed Fund and each Separate Account Division.
PART 9. PARTIAL WITHDRAWALS
PARTIAL WITHDRAWALS
Withdrawals may be made on any Valuation Day. The withdrawal must be requested
by the Contract Holder in a form acceptable to the Company. Withdrawals will be
effective on the Valuation Day on which the request is received in proper form
by SELIC.
Unless other specific instructions are received from the Contract Holder, the
withdrawal will be taken from the Fixed Fund and the Separate Account Divisions
in proportion to the Contract Holder's current Insurance Account Value in the
Fixed Fund and each Separate Account Division.
The Death Benefit and Face Amount at the time the withdrawal is taken may be
reduced, based on the amount withdrawn and the Death Benefit Option then in
effect.
MAXIMUM WITHDRAWAL AMOUNT
The Maximum Withdrawal Amount for this Contract is equal to the Insurance
Account Value less the sum of the following:
(a) outstanding loan amount together with unpaid accrued loan interest; and
(b) the Minimum Net Premium for the current Contract Year; and
(c) loan interest until the next Contract Anniversary.
However, the Maximum Withdrawal Amount is exceeded whenever such withdrawal
would reduce the Face Amount below the minimum stated in Contract Schedule D.
MINIMUM WITHDRAWAL AMOUNT
The amount of each withdrawal must be at least equal to the Minimum Withdrawal
Amount shown in Contract Schedule A.
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PART 10. REPORTS TO CONTRACT HOLDER
ANNUAL REPORT
Each year within 30 days after the Contract Anniversary, the Company will mail a
report to the Contract Holder. The report will show the Insurance Account Value
at the beginning of the previous Contract Year and all premiums paid since that
time. It will also show the additions to, and deductions from, the Insurance
Account Value during the Contract Year, and the Insurance Account Value, Death
Benefit, Net Cash Value, outstanding Contract Loans and accrued loan interest as
of the current Contract Anniversary. This report will also include any
additional information required by applicable law or regulation.
ILLUSTRATIVE REPORT
In addition to the Annual Reports, the Contract Holder may request an
Illustrative Report showing projected Contract values. There may be a charge for
providing an Illustrative Report (see Contract Schedule B).
PART 11. TERMINATION PROVISIONS
GRACE PERIOD
If the Net Cash Value is not sufficient to cover the Monthly Charges due on any
Monthiversary, a Grace Period is allowed for payment of the amount of premium
needed to increase the Insurance Account Value so that monthly deductions can be
made. This Grace Period begins on the date the deduction is due. It ends 61 days
from that date or, if later, 61 days after the date SELIC mails a written notice
to the Contract Holder at the last known address shown on XXXXX's records. This
notice will state the amount or premium required to be paid to increase the
Insurance Account Value. During the Grace Period, the insurance coverage will
continue in effect. Unpaid Monthly Charges to the date of death will be deducted
from any Death Benefit proceeds.
To continue the insurance coverage in force, the Contract Holder must make an
additional premium payment before the end of the Grace Period at least equal to
three (3) times the Monthly Charges due when the Grace Period began, plus any
Premium Loads.
CONTRACT TERMINATION
This Contract will terminate on the earliest to occur of the following:
(1) the end of the Grace Period for this Contract; or
(2) this Contract is surrendered by the Contract Holder; or
(3) the Maturity Date of this Contract; or
(4) when all the obligations of the Company under this Contract have been
fulfilled.
SURRENDER
This Contract may be surrendered for its Net Cash Value on any Valuation Day.
The Contract Holder must request a Surrender in a form acceptable to the
Company.
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REINSTATEMENT
This Contract may be reinstated, prior to the Maturity Date, provided that:
(1) satisfactory Evidence of Insurability is provided to the Company; and
(2) this Contract has not been surrendered for cash; and
(3) the Contract Holder must request the Reinstatement in a form acceptable to
the Company; and
(4) the request must be within five (5) years of the date of Contract
termination; and
(5) the Reinstatement Premium must be paid at the time of Reinstatement. The
Reinstatement Premium must be no less than the amount specified in Part 4,
Premium Payments; and
(6) the Insured must be alive on the date the Reinstatement becomes effective.
The Reinstatement will become effective on the date that it is approved by
the Company.
MATURITY DATE
No insurance coverage will be effective on or after the Maturity Date. If the
Insured is living and this Contract is in force on this date the Net Cash Value
will be paid to the Contract Holder, and the liability of the Company under this
Contract will cease.
PART 12. GENERAL PROVISIONS
ENTIRE CONTRACT
This Contract is issued in consideration of the Application and the Initial
Premium payment. This Contract and Application, a copy of which is attached,
together with any Contract Schedules, any Riders and any other related documents
constitute the entire Contract. Any waiver or change of any provision in this
Contract must be in writing and signed by an officer of the Company.
WAIVER NOT ESTOPPEL
The failure of the Company to enforce any provision of this Contract will not
constitute or be construed as a waiver of such provision or of the right to
enforce it at a later time, nor will the waiver of any provision by the Company
on one or more occasions constitute or be construed as a waiver for all
occasions and the Company will not be estopped from enforcing any provision of
this Contract except as may be otherwise agreed to in writing by an officer of
the Company.
RIGHT TO AMEND
If any provision in this Contract is in conflict with the laws of the state
which govern this Contract, the provision will be deemed to be amended to
conform with such laws. In addition, this Contract may be amended from time to
time by the Company as may be required to meet the definition of life insurance
under the Internal Revenue Code, or its regulations or published rulings.
CONTRACT HOLDER COVENANTS
The Contract Holder represents that all statements made in the Application for
this Contract are true and complete to the best of his or her knowledge and
belief. The Contract Holder also covenants with the Company that all statements
made in any related documents supplied to the Company, including negative
answers to any questions contained in any related documents supplied by the
Company, will be true and complete to the best of the Contract Xxxxxx's
knowledge and belief.
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If any information contained in this Contract, Application, Contract Schedules
or any other related documents for this Contract is inaccurate or untrue on the
date it is issued, the Contract Holder agrees to promptly notify the Company and
provide corrected information.
COMPANY COVENANTS
The Company agrees that all statements in the Application will be deemed
representations and not warranties. The Company also agrees that no statement
will, in the absence of fraud, be used to void this Contract or be used in
defense of a claim for the insurance benefits under this Contract unless it is
contained in the Application or in related documents and signed either by the
Contract Holder or by the proposed Insured. A copy of the Application is
attached to this Contract at issue.
FIXED BENEFIT RIGHT
The Contract Holder has a one time right during the first 24 months, as long as
this Contract is in force, to transfer all of the Insurance Account Value in the
Separate Account to the Fixed Fund. This request must be in writing and must
specifically indicate that the transfer is being made in exercise of the Fixed
Benefit Right. This transfer will not be subject to any transfer limitations or
charges. At the time of such transfer, there will not be any effect on this
Contract's Death Benefit, Face Amount, Net Amount at Risk, any Contract Loans,
Issue Age or insurance class. All Net Premiums paid after this transfer is made
will be allocated to the Fixed Fund. Once this transfer is elected, no future
Net Premiums may be allocated to the Separate Account Divisions, and no
transfers will be allowed from the Fixed Fund into the Separate Account
Divisions.
MISSTATEMENT OF AGE OR SEX
If it is found that the amount of any benefit provided by this Contract is
incorrect because of misstatement as to the age or sex (if applicable), the
amount of the benefit will be equitably adjusted on the basis of the correct
facts.
INCONTESTABILITY
In order for the Company to contest the validity of any insurance coverage
provided by this Contract, legal action must be commenced within two years from
the Issue Date or from the effective date of any change requiring Evidence of
Insurability.
EVIDENCE OF INSURABILITY
Evidence of Insurability may be required for any transaction that increases the
Net Amount at Risk of this Contract. Transactions that increase the Net Amount
at Risk may include: Payment of Subsequent Premiums, a Change of Face Amount or
Death Benefit Option, Partial Withdrawal, or Reinstatement.
METHOD OF COMPUTING VALUES
A detailed statement of the method used to compute this Contract's benefits and
values is filed with the insurance regulatory authority of the Governing
Jurisdiction. These benefits and values are not less than those required by the
laws of the Governing Jurisdiction.
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AVAILABILITY OF FUNDS
Cash payments from this Contract for Contract Loans, Partial Withdrawals or
Surrender, and Accumulation Units transferred between or among Separate Account
Divisions will usually be effected within seven days after a satisfactory
request is received at the Home Office of the Company. Payment may be delayed,
however, during any period that:
(1) the New York Stock Exchange (or its successor or, if the securities in
which the assets of the Separate Accounts are invested are not traded on
the New York Stock Exchange, any principal exchange on which such
securities are traded) is closed, or trading is restricted; or
(2) the S.E.C. determines that a state of emergency exists.
Payment of the portion of any amount payable from the Fixed Fund for Contract
Loans, Partial Withdrawals or Surrender, and transfers to the Separate Account
Divisions may be delayed for not more than 6 months. If payment is deferred for
30 days or more, SELIC will pay interest on such amounts at the rate of 2 1/2%
per year for the period of deferment.
Payments will not be delayed if the amounts are used to pay premiums to SELIC.
CLAIMS OF CREDITORS
The proceeds of this Contract will be free from creditor's claims to the extent
allowed by law.
NOTICE
Any written notice required by this Contract to be given by the Company to the
Contract Holder will be effective five (5) days after it is mailed by first
class mail or fifteen (15) days after it is mailed by third class mail (or when
received, if sent by any other means) to the Contract Holder at the Contract
Xxxxxx's last known address as noted on the records of the Company.
Any written notice required by this Contract to be given by the Contract Holder
to the Company will be effective when received in a form acceptable to the
Company at its Home Office. To be acceptable, a notice must be in written form,
in the English language (except where applicable law requires otherwise), must
include all pertinent information, and must be signed by the Contract Holder or
an individual authorized to act for the Contract Holder and so designated on the
records of the Company.
ASSIGNMENT
This Contract may be assigned by the Contract Holder. No assignment will be
effective against the Company until the Contract Holder notifies SELIC of the
assignment in writing. The Company is not responsible for the validity of any
assignment.
CONSTRUCTION
In the event of a conflict between this Contract's provisions and the
information contained in any related documents for this Contract, the provisions
of this Contract will be controlling.
SEVERABILITY
In the event any provision of this Contract is declared illegal or otherwise
unenforceable, it will be severed from this Contract and the remainder of this
Contract will be valid and enforceable.
60606 6.04 1294
