EXHIBIT 10(b)
ACTUARIAL MEMORANDUM
ACTUARIAL MEMORANDUM
--------------------
PHOENIX LIFE INSURANCE COMPANY
FORM D610 - FLEXIBLE PREMIUM VARIABLE ACCUMULATION DEFERRED ANNUITY
This contract provides for payment of a deferred variable life expectancy
annuity based on the accumulated Contract Value. The amount of the initial
annuity payment will be based on the Contract Value and the life expectancy of
the annuitant or the joint life expectancy of the annuitant and joint annuitant.
Succeeding payments will be based on the investment experience of the
Subaccounts , the Guaranteed Interest Account(GIA) and the Market Value Adjusted
Guaranteed Interest Account(MVA) to which the Contract Value is allocated and
the annuitant's annually recalculated life expectancy or the annually
recalculated life expectancy of the annuitant and joint annuitant. The
subsequent payments may be higher or lower than the initial payment.
PREMIUM PAYMENTS
----------------
Premium payments, less any applicable premium tax, are allocated to Subaccounts
of a separate account, the GIA, and the MVA as directed by the contractholder.
The available Subaccounts are the Subaccounts of the Phoenix Life Insurance
Company Variable Accumulation Separate Account (VA Account).
The GIA is accounted for as part of the General Account of Phoenix
Insurance Company. Interest is credited daily on the amounts held under the
Guaranteed Interest Account at such rates as Phoenix Insurance Company
shall determine, but in no event will the effective annual rate of interest on
such amounts be less than 3%.
The MVA is a Separate Account established by Phoenix according to
Connecticut law. The assets supporting Phoenix's obligations based on
allocations to the MVA are held in Phoenix Separate Account MVA1 ("Separate
Account MVA1"), which is a "nonunitized" separate account. Such obligations are
based on the interest rates credited to allocations to the MVA and the terms of
the Contract. These obligations do not depend on the investment performance of
the assets in Separate Account MVA1. Phoenix guarantees specified rates of
interest for amounts allocated to the MVA for specified periods(Guarantee
Period). The Guaranteed Rate offered will, in no event, be less than 3%.
The VA Account was established on June 21, 1982 as a Separate Account under
Connecticut insurance law. On July 21, 1992, the Account's domicile was
transferred to New York. The VA Account is registered with the SEC as a unit
investment trust under the Investment Company Act of 1940. The assets of the VA
Account are used to purchase, at net asset value, shares of the following funds:
The Phoenix Edge Series Fund, AIM Variable Insurance Funds, The Xxxxx American
Fund, Deutsche Asset Management VIT Funds, Federated Insurance Series,
Fidelity(R) Variable Insurance Products, Franklin Xxxxxxxxx Variable Insurance
Products Trust, The Universal Institutional Funds, Inc. and Xxxxxx Advisors
Trust.
DETERMINATION OF THE CONTRACT VALUE
-----------------------------------
The total Contract Value under this contract equals the sum of the values of the
contract held in the Guaranteed Interest Account plus the values held in the MVA
plus the values of the contract's Accumulation Units held in each of the
Subaccounts of the VA Account.
DETERMINATION OF THE VALUE OF THE GIA
-------------------------------------
The value under the contract of the GIA is equal to the sum of all premium or
transfer amounts applied to the Guaranteed Interest Account and all interest
earned on these amounts less amounts withdrawn or transferred from this account
and amounts used as payment of the Annual Administrative Charge. The interest
credited will at least equal the guaranteed annual effective interest rate of
3%.
DETERMINATION OF THE VALUE OF THE (MVA)
---------------------------------------
The value under the contract of the MVA is equal to the sum of all premium or
transfer amounts applied to the MVA and all interest earned on these amounts
less amounts withdrawn or transferred from this account and amounts used as
payment of the Annual Administrative Charge less any applicable market value
adjustment. Phoenix guarantees specified
1
rates of interest for amounts allocated to the MVA for specified
periods(Guarantee Period). The Guaranteed Rate offered will, in no event, be
less than 3%.
MARKET VALUE ADJUSTMENT
-----------------------
Any withdrawal from the MVA will be subject to a Market Value Adjustment unless
the effective date of the withdrawal is within 15 days before and after the end
of a Guarantee Period. For this purpose, redemptions, transfers and maturity
amounts are treated as withdrawals. The Market Value Adjustment will be applied
to the amount being withdrawn after the deduction of any applicable
Administrative Charge and before the deduction of any applicable Contingent
Deferred Sales Charges (surrender charges). The Market Value Adjustment can be
positive or negative. The amount being withdrawn after application of the Market
Value Adjustment can be greater than or less than the amount withdrawn before
the application of the Market Value Adjustment.
A Market Value Adjustment will not be applied upon the payment of the Death
Benefit.
The Market Value Adjustment will reflect the relationship between the Current
Rate (defined below) for the amount being withdrawn and the Guaranteed Rate. It
is also reflective of the time remaining in the applicable Guarantee Period.
Generally, if the Guaranteed Rate is lower than the applicable Current Rate,
then the application of the Market Value Adjustment will result in a lower
payment upon withdrawal. Conversely, if the Guaranteed Rate is higher than the
applicable Current Rate, the application of the Market Value Adjustment will
produce a higher payment upon withdrawal.
The Market Value Adjustment applied to the amount being withdrawn is determined
by using the following formula:
Market Value Adjustment
= Amount x [ 1+ i ] n/12-1
[_________]
[1+j+.0025]
where,
Amount, is the amount being withdrawn from a given accumulated amount less any
applicable administrative charges.
i, is the Guaranteed Rate being credited to the amount subject to the Market
Value Adjustment; and
j, is the Current Rate, which is the current interest rate, for new deposits
with a Guarantee Period equal to the number of years remaining in the current
Guarantee Period, rounded up to the next higher number of complete years; and
n, is the number of months rounded up to the next whole number from the date of
the withdrawal or transfer to the end of the current Guarantee Period.
If the Company does not offer a Guarantee Period equal to the number of years
remaining in the Guarantee Period, "j" will be determined by interpolation of
the Guaranteed Rate for the Guarantee Periods then available.
DETERMINATION OF THE VALUE OF THE SUBACCOUNTS OF THE VA ACCOUNT
---------------------------------------------------------------
The value of a Subaccount of the VA Account is determined by multiplying the
total number of units under the contract for that Subaccount by the Unit Value
of the Subaccount. The total number of units under the contract for a Subaccount
of the VA Account is equal to the number of units credited to the Subaccount by
premium payment or transfer, minus the number of units released by transfers,
withdrawals or payments of the Annual Administrative Charge. With each premium
payment, withdrawal, administrative charge payment, or transfer, the number of
units credited to or subtracted from a Subaccount will be determined by dividing
the amount of the premium payment, withdrawal, administrative charge payment, or
transfer applied to that Subaccount by the then current Unit Value of that
Subaccount on the Valuation Date that coincides with the date of the
transaction.
2
The Unit Value of each Subaccount of the VA Account was set by us on the first
Valuation Date of the Subaccount. The current Unit Value of a Subaccount on any
subsequent Valuation Date is determined by multiplying the Unit Value of the
Subaccount on the immediately preceding Valuation Date by the Net Investment
Factor for that Subaccount for the Valuation Period just ended.
NET INVESTMENT FACTOR
---------------------
The Net Investment Factor for a Subaccount of the VA Account for a Valuation
Period is equal to 1.000000 plus the applicable net investment rate. The net
investment rate is determined by:
(a) taking the sum of the accrued net investment income and
capital gains and losses, realized or unrealized, of the
Subaccount for the Valuation Period; and
(b) dividing the result of (a) by the value of the Subaccount at
the beginning of the Valuation Period; and
(c) for each calendar day in the Valuation Period, subtracting an
amount equal to the daily Mortality and Expense Risk Fee plus
the Daily Administration Fee, and plus the daily Tax Fee, if
any.
STATUTORY RESERVE
-----------------
Reserves are calculated based on the NAIC Actuarial Guideline 33, or continuous
CARVM methodology. We project the benefits using scenarios such as:
o Assume the contract holder exercises free withdrawals at every
allowable time;
o Assume the contract holder surrenders the contract at the next
anniversary, or each subsequent anniversary;
o Assume the contract holder holds the contract until all surrender
charges have expired;
o Assume the contract holder exercises free withdrawals, then surrenders
immediately, or at the next anniversary, or at each subsequent
anniversary
We determine which scenario will produce the largest present value of projected
benefits, and we calculate the reserve on a seriatim basis.
The statutory reserves during the accumulation period are equal to the sum of
(a) and (b) below:
(a) a continuous CARVM reserve(as described above), but no less
than the policy's surrender value;
(b) an additional reserve based on the guaranteed death benefit
chosen at issue. The additional reserve for each death benefit
option are described below.
(1) OPTION 1(RETURN OF PREMIUM) AND OPTION 2(ANNUAL STEPUP)-
the additional reserve is calculated based on the
Connecticut letter method. This reserve is calculated on a
seriatum basis. It assumes a one-third drop in the account
value, determines the exposure generated by such a drop
and multiplies the exposure by a mortality rate based on
the 1994 GAM Table.
(2) OPTION 3(RETURN OF PREMIUM WITH RELIEF BENEFIT AND
ACCUMULATION ENHANCEMENT)- This reserve is calculated on a
seriatum basis and is equal to the greater of (A) and (B)
below.
(A)Connecticut letter method. This reserve is
calculated on a seriatum basis. It assumes a
one-third drop in the account value, determines
the exposure generated by such a drop and
multiplies the exposure by a mortality rate based
on the 1994 GAM Table.
(B)The Relief benefit reserve is equal to a
percentage(40% for issue ages less than 70, 25%
for issue ages 70-75) of the Relief Amount
multiplied by a mortality rate based on the 1994
GAM.
3
The Accumulation Enhancement active life reserves
are determined for this policy based on the Full
Net Level Method. The interest rate used
throughout all years for this product is 4.5
percent. Mortality rates used are based on the
1983 GAM Table. Morbidity rates are a
conservative modification of those used in
pricing, which are based on incidence rates from
the 1982-84 National Long Term Care Survey. Until
reasonably reliable prospective estimates of
charges and claims can be determined, a
retrospective process will be used. This process
will be monitored at least annually and refined
to assure reserve adequacy.
If the contract is continued under an annuity option, the reserve equals the
present value of all future annuity payments based on the last such payment and
based on the Annuity 2000 table and an interest rate no greater than the maximum
valuation interest rate as determined by the Standard Valuation Law for the
appropriate contract type and issue year.
Under variable payout annuity Option L, the reserve will be the Contract Value
held in the VA Account.
SURRENDER VALUE
---------------
At any time after the Contract Date, the owner may withdraw part or all of the
contract's Surrender Value. The Surrender Value of the contract equals the
Contract Value of the contract on the Valuation Date that coincides with the
date of withdrawal minus any applicable surrender charge.
SURRENDER CHARGE
----------------
Any withdrawal in excess of 10% of the Contract Value will be subject to the
following Surrender Charge (Contingent Deferred Sales Charge), expressed as a
percentage of the amount withdrawn, up to a maximum of the total premiums paid.
In the first contract year, the 10% withdrawal without a sales charge is
determined based on the Contract Value on the date of the first partial
withdrawal. In all subsequent years, the 10% will be based on the previous
Contract anniversary value.
Complete Years from Surrender Charge
Premium Payment Date Percentage
--------------------------------------------------------------
0 8%
1 7%
2 6%
3+ 0%
The contingent deferred sales charge is applied to amounts withdrawn or
surrendered up to the total of all premium payments less prior withdrawals for
which a contingent deferred sales charge was paid. Following a partial
withdrawal, the death benefit will be reduced by the same proportion as the
Contract Value is reduced by the withdrawal.
The Units and amounts released for transfer or withdrawal will be determined on
the First In, First Out (FIFO) basis.
In no event will the Surrender Charge applied exceed 9% of the total premiums
paid on this contract.
ANNUAL ADMINISTRATIVE CHARGE
----------------------------
An Annual Administrative Charge is deducted at the end of each contract year
from the Contract Value of the contract. This charge will never exceed $35 and
each Subaccount bears a pro-rata share of this expense based on the Subaccount's
proportionate Contract Value.
DAILY MORTALITY AND EXPENSE RISK FEE
------------------------------------
A Mortality and Expense Risk Fee is taken from each Subaccount of the VA Account
in the calculation of the Net Investment Factor. The Mortality and Expense(M &
E) Risk Fee is taken daily and is based on the annual rate shown below.
4
Daily M & E Annual M & E
----------- ------------
Death Benefit Option 1 .00418% 1.525%
Death Benefit Option 2 .00459% 1.675%
Death Benefit Option 3 .00500% 1.825%
DAILY ADMINISTRATIVE FEE
------------------------
A Daily Administrative Fee is taken daily from each Subaccount of the VA Account
in the calculation of the Net Investment Factor. The Daily Administrative Fee is
0.00034% which is based on an annual rate of 0.125%.
TRANSFER CHARGE
---------------
The Transfer Charge is $0.00. This charge is variable and we reserve the right
to charge a transfer fee after the first twelve transfers in each contract year,
not to exceed $20.00 per transfer. If we should do this we will notify the state
insurance department and seek any required approval.
DAILY TAX FEE
-------------
A Tax Fee, if any, is taken daily against each Subaccount of the VA Account in
such amount as appears on the Schedule Page of the contract.
PREMIUM TAX
-----------
The premium tax rate, if any, as of the Contract Date, is shown on the contract
Schedule Page. This rate may change for subsequent premium payments in
accordance with applicable state law. We will pay any premium tax due and will
only reimburse ourselves upon remittance of the premium tax to the applicable
state or municipality.
DEATH BENEFIT
-------------
OPTION 1: STANDARD - RETURN OF PREMIUM
-------------------------------------------------
The death proceeds (less any deferred premium tax) equal the
greater of:
a. 100% of premium payments less "Adjusted Partial
Withdrawals" (as defined below); or
b. the Contract Value next determined following receipt
of a certified copy of the death certificate.
OPTION 2: ANNUAL STEP-UP TO AGE 80
-----------------------------------
Where the eldest Owner has not yet attained age 80, the death
proceeds (less any deferred premium tax) equal the greater of:
a. 100% of premium payments less "Adjusted Partial
Withdrawals" (as defined below); or
b. the "Annual Step-up Amount" (as defined below); or
c. the Contract Value next determined following receipt
of a certified copy of the death certificate.
On and after the eldest Owner's attained age 80, the death
proceeds (less any deferred premium tax) equal the greater of:
a. the death benefit calculated at the end of the
Contract Year prior to the eldest Owner's attained
age 80, plus 100% of the premium payments less
"Adjusted Partial Withdrawals" made since the end of
the Contract Year prior to the eldest Owner's
attained age 80;
or
5
b. the Contract Value next determined following receipt of a
certified copy of the death certificate.
ADJUSTED PARTIAL WITHDRAWALS
The Adjusted Partial Withdrawal is calculated for each partial
withdrawal as the product of (a) times (b) where:
(a) is the ratio of the amount of the partial withdrawal to
the Contract Value on the date of (but prior to) the
partial withdrawal; and
(b) is the death benefit on the date of (but prior to) the
partial withdrawal.
ANNUAL STEP-UP AMOUNT (FOR DEATH BENEFIT OPTION 2)
In the first contract year, the Annual Step-up Amount is equal
to 100% of premium payments less "Adjusted Partial
Withdrawals".
In the second contract year or any subsequent contract year,
the Annual Step-up Amount is equal to the greater of:
1. the Annual Step-up Amount at the end of the previous contract
year, plus 100% of premium payments made since the end of
the previous contract year, less "Adjusted Partial
Withdrawals" made since the end of the previous contract year;
or
2. the Contract Value.
DEATH BENEFIT - OPTION 3 RELIEF DEATH BENEFIT WITH ACCUMULATION ENHANCEMENT
This death benefit is based on the age of the Owner on the Contract Date. If
there is more than one Owner, it is based on the age of the eldest Owner.
If the Owner has not attained age 70 on the Contract Date, the death benefit
(less any premium tax) is equal to A or B, whichever is greater, where:
A is 100% of premium payments less "Adjusted Partial Withdrawals" (as defined
below); and
B is the Contract Value next determined following receipt of a certified death
certificate at our annuity operations division, plus 40% of the Relief Amount
(as defined below).
If the Owner has attained age 70 but not yet attained age 76 on the Contract
Date, the death benefit (less any premium tax) is equal to A or B, whichever is
greater, where:
A is 100% of premium payments less "Adjusted Partial Withdrawals" (as defined
below); and
B is the Contract Value next determined following receipt of a certified death
certificate at our annuity operations division, plus 25% of the Relief Amount
(as defined below).
If the contract is not owned by a natural person, the age of the Primary
Annuitant on the Contract Date will be used to calculate the death benefit.
6
If the spouse elects to continue the contract under Death Benefit Option 3, the
death benefit under the continued contract will be calculated using the
surviving spouse's attained age as of the date we continue the contract.
RELIEF AMOUNT
The Relief Amount is equal to the Contract Value less Modified Premium Payments
(as defined below), not to exceed the following maximum amount:
If eldest Owner has not attained age 70 on the Contract Date, the maximum Relief
Amount is 200% multiplied by (A minus B minus C), where:
A is sum of Modified Premium Payments made prior to the date the death benefit
is calculated.
B is the sum of premium payments made during the 12 months prior to date of the
death benefit is calculated.
C is the sum of Monthly Benefits (as defined below) credited to Contract Value.
If eldest Owner has attained age 70 but not yet attained age 76 on the Contract
Date, the maximum Relief Amount is 100% multiplied by (A minus B minus C),
where:
A is the sum of Modified Premium Payments made prior to the date the death
benefit is calculated.
B is the sum of premium payments made during the 12 months prior to date of
calculation.
C is the sum of Monthly Benefits (as defined below) credited to Contract Value.
MODIFIED PREMIUM PAYMENTS
Modified Premium Payments are equal to the following:
The sum of all premium payments plus Monthly Benefits credited to Contract
Value, if any;
minus
2. the amount that each partial withdrawal exceeds the difference, at the time
of each partial withdrawal, between: (1) the Contract Value prior to the partial
withdrawal, and (2) the Modified Premium Payments prior to the partial
withdrawal. If the partial withdrawal does not exceed this difference, or if
there are no partial withdrawals, this value is zero. Partial withdrawals are
taken from earnings first, then from the premium payments in the order they were
received.
ADJUSTED PARTIAL WITHDRAWALS
The sum of all Adjusted Partial Withdrawals when each is calculated as the
product of A multiplied by B where:
A is the ratio of the amount of the partial withdrawal to the Contract
Value on the date of (but prior to) the partial withdrawal; and
B is the death benefit on the date of (but prior to) the partial
withdrawal.
MONTHLY BENEFIT
The monthly amount credited to the Contract Value when a claim under the
Accumulation Enhancement is being paid.
ELIGIBILITY FOR ACCUMULATION ENHANCEMENT (AE)
You may be eligible for the Accumulation Enhancement (AE) under Death Benefit
Option 3 (described below). If there is more than one Owner, the AE is available
to any Owner but only one AE claim will be paid under this contract. The AE is
not available in Contract Year 1 and is not available after the Maturity Date.
To apply for the AE, the Owner must provide Written Notice to Us that the
Covered Person has completed the
7
Qualification Period.
The Covered Person means the Owner. The Covered Person will mean the Primary
Annuitant if the contract is not owned by a natural person. The Covered Person
must be less than age 91 at the time the Qualification Period expires in order
to qualify for the AE.
THE QUALIFICATION PERIOD
The Qualification Period is 120 consecutive days of confinement to a Nursing
Home or Assisted Care Living Facility which commences anytime after the first
Contract Year has expired but prior to the Maturity Date and prior to the
Covered Person attaining age 91. Any day the Covered Person is confined during
the first Contract Year will not count towards satisfaction of the Qualification
Period. The Nursing Home or Assisted Care Living Facility must be located within
the 50 jurisdictions of the United States.
CALCULATION OF ACCUMULATION ENHANCEMENT (AE) AND CREDIT TO CONTRACT VALUE
The AE is calculated only once. The AE is calculated as of the first Valuation
Date after the Qualification Period has expired, regardless of when We receive
Written Notice that the Qualification Period has expired.
If the Owner has not attained age 70 on the Contract Date, the AE will equal 40%
of the Relief Amount. If the Owner has attained age 70 but not yet attained age
76 on the Contract Date, the AE will equal 25% of the Relief Amount. The Relief
Amount is defined above. For all contracts issued by the Us or an affiliated
company, the maximum AE (or similar enhancement) amount We will pay with respect
to a Covered Person is $750,000.
Each month for 50 consecutive months, two percent (2%) of the AE will be
credited to the Contract Value, provided the Covered Person is still living.
This monthly amount credited to the Contract Value is called the Monthly
Benefit. Since the AE is calculated as of the first Valuation Date after the
Qualification Period has expired, there could be a retroactive Monthly
Benefit(s) credited to the Contract Value. At the end of the 50 consecutive
months, the entire AE amount will have been credited and Monthly Benefits will
cease
TERMINATION OF ACCUMULATION ENHANCEMENT (AE) The AE terminates on the earliest
of the following:
the date the AE maximum amount (as described above) is exhausted;
the date the contract terminates for any reason; the date of the Covered
Person's death;
the date the Annuitant changes if the Covered Person is the Annuitant;
the Maturity Date.
DEFINITIONS:
ASSISTED CARE LIVING FACILITY means a facility which is licensed or certified by
the jurisdiction in which it is located and is operating to provide care to 10
or more persons; and meets the following:
(1)has a 24-hour on-site staff to provide care and services sufficient to
support the Covered Person's needs;
(2)has established procedures for obtaining appropriate aid in the event of a
medical emergency; and
(3)makes a charge, including room and board for such care and services.
NURSING HOME means a free-standing facility or distinct part of a facility
(including a ward, wing, or swing-bed unit of a hospital or other facility)
which is licensed or certified, if required, by the jurisdiction in which it is
located; and meets the following:
(1)provides skilled or intermediate care by one or more of the following health
care professionals: registered nurse, licensed vocational nurse, licensed
practical nurse, physical therapist, occupational therapist, speech therapist,
respiratory therapist, licensed medical social worker or registered dietitian.
8
(2)provides services performed by or under the immediate supervision of a
registered nurse, licensed practical nurse or licensed vocational nurse, on-site
twenty-four (24) hours per day.
Assisted Care Living Facility or Nursing Home do not include any facility
located on the premises of, or that has arrangements with: a retirement home,
residential living facility or continuing care retirement community to provide
care and services to their residents.
Assisted Care Living Facility or Nursing Home does not mean:
o a hospital or clinic;
o a rehabilitation hospital or facility;
o the Covered Person's primary place of residence including independent
living units in a continuing care retirement community or similar
facility; or
o a facility for the treatment of alcoholism, drug addiction, or mental
illness or disorders.
ANNUITY BENEFIT AT MATURITY
---------------------------
Unless the owner elects an alternative payment option or receives the contract's
surrender value in a lump sum on or before the Maturity Date, the Contract Value
less any premium tax due on the Maturity Date will be applied to provide a
variable life expectancy annuity based on the Annuitant's age and sex under
Payment Option A Life Annuity with 10 year period certain. Upon the death of the
Annuitant(and Joint Annuitant, if there is a Joint Annuitant), the remaining
Contract Value will be paid in a lump sum to the Annuitant's beneficiary.
ANNUITY PAYMENT OPTIONS
-----------------------
CALCULATION OF FIXED ANNUITY PAYMENTS
Under Options A, B, D, E and F, rates are based on the 1983a Individual Annuity
Mortality Table projected with projection scale G to the year 2040 and an
interest rate of 3%. Under Options G and H, the guaranteed interest rate is 3%.
CALCULATION OF VARIABLE ANNUITY PAYMENTS
Under Options I, J, K, M and N, the amount of the first payment is equal to the
amount held under the selected option in each Subaccount, divided by $1,000 and
then multiplied by the applicable payment option rate. The first payment equals
the sum of the amounts provided by each Subaccount.
In each Subaccount, the number of fixed annuity Units is determined by dividing
the amount of the initial payment provided by that Subaccount by the Annuity
Unit Value for that Subaccount on the first Payment Calculation Date.
Thereafter, the number of fixed Annuity Units in each Subaccount remains
unchanged unless You transfer funds to or from the Subaccount. If You transfer
funds to or from a Subaccount, the number of fixed Annuity Units will change in
proportion to the change in value of the Subaccount as a result of the transfer.
The number of fixed Annuity Units will change effective with the transfer, but
will remain fixed in number following the transfer.
Second and subsequent payments are determined by multiplying the number of fixed
Annuity Units for each Subaccount by the Annuity Unit Value for that Subaccount
on the Payment Calculation Date. The total payment will equal the sum of the
amounts provided by each Subaccount. The amount of second and subsequent
payments will vary with the investment experience of the Subaccounts and may be
either higher or lower than the first payment.
Under Option L, We determine the amount of the annual distribution by dividing
the amount of Contract Value held under this option as of the payment
calculation date by the life expectancy of the Annuitant or the joint life
expectancy of the Annuitant and Joint Annuitant at that time.
9
Under Options I, J, M and N, the applicable payment option rate used to
determine the first payment amount will not be less than the rate based on the
1983a Individual Annuity Mortality Table projected with projection scale G to
the year 2040, with continued projection thereafter and the Assumed Investment
Rate.
Under Option K, the payment option rate will be based on the number of payments
to be made during the specified period and the Assumed Investment Rate.
We guarantee that neither expenses actually incurred, other than taxes on
investment return, nor mortality actually experienced, shall adversely affect
the dollar amount of variable annuity payments.
OPTION A - LIFE ANNUITY WITH SPECIFIED PERIOD CERTAIN
A fixed payout annuity payable monthly while the Annuitant is living or, if
later, the end of the specified period certain. The period certain may be
specified as 5, 10, or 20 years. The period certain must be specified at the
time this option is elected.
OPTION B - NON-REFUND LIFE ANNUITY
A fixed payout annuity payable monthly while the Annuitant is living. No monthly
payment, death benefit or refund is payable after the death of the Annuitant.
OPTION D - JOINT AND SURVIVORSHIPLIFE ANNUITY
A fixed payout annuity payable monthly while either the Annuitant or designated
Joint Annuitant is living. You must designate the Joint Annuitant at the time
You elect this option. The designated Joint Annuitant must be at least age 40 on
the first Payment Calculation Date.
OPTION E - INSTALLMENT REFUND LIFE ANNUITY
A fixed payout annuity payable monthly while the Annuitant is living. If the
Annuitant dies before the annuity payments made under this option total an
amount which refunds the entire amount applied under this option, we will make a
lump sum payment equal to the entire amount applied under this option less the
sum of payments already made.
OPTION F - JOINT AND SURVIVORSHIP LIFE ANNUITY WITH 10-YEAR PERIOD CERTAIN
A fixed payout annuity payable monthly while either the Annuitant or designated
Joint Annuitant is living, or if later, the end of 10 years. You must designate
the Joint Annuitant at the time You elect this option. The Joint Annuitant must
be at least age 40 on the first Payment Calculation Date.
OPTION G - PAYMENTS FOR A SPECIFIED PERIOD
A fixed payout annuity payable monthly over a specified period of time. Payments
continue whether the Annuitant lives or dies. The specified period must be in
whole numbers of years from 5 to 30, but cannot be greater than 100 minus the
age of the Annuitant. However, if the beneficiary of any death benefits payable
under this contract elects this Payment Option, the period selected by the
beneficiary may not extend beyond the life expectancy of such beneficiary.
OPTION H - PAYMENTS OF A SPECIFIED AMOUNT
Equal income installments of a specified amount are paid until the principal sum
remaining under this option from the amount applied is less than the amount of
the installment. When that happens, the principal sum remaining will be paid as
a final payment. The amount specified must provide for payments for a period of
at least 5 years.
OPTION I - VARIABLE LIFE ANNUITY WITH 10-YEAR PERIOD CERTAIN
A variable payout annuity payable monthly while the Annuitant is living or, if
later, for ten years. If the beneficiary of any death benefits payable under
this contract elects this payment option, the period certain will equal the
shorter of 10 years and the life expectancy of such beneficiary.
OPTION J - JOINT SURVIVORSHIP VARIABLE LIFE ANNUITY WITH 10-YEAR PERIOD CERTAIN
A variable payout annuity payable monthly while either the Annuitant or
designated Joint Annuitant is living, or if later, the end of 10 years. You must
designate the Joint Annuitant at the time You elect this option. The Joint
Annuitant must be at least age 40 on the first Payment Calculation Date. This
option is not available for the payment of any death benefit under this
contract.
10
OPTION K - VARIABLE ANNUITY FOR SPECIFIED PERIOD
A variable payout annuity payable monthly over a specified period of time.
Payments continue whether the Annuitant lives or dies. The specified period must
be in whole numbers of years from 5 to 30, but cannot be greater than 100 minus
the age of the Annuitant. However, if the beneficiary of any death benefits
payable under this contract elects this payment option, the period selected by
the beneficiary may not extend beyond the life expectancy of such beneficiary.
This option also provides for unscheduled withdrawals. An unscheduled withdrawal
will reduce the number of fixed Annuity Units in each Subaccount and affect the
amount of future payments.
OPTION L - VARIABLE LIFE EXPECTANCY ANNUITY
This option provides a variable income which is payable over the Annuitant's
annually recalculated life expectancy or the annually recalculated life
expectancy of the Annuitant and Joint Annuitant. This option also provides for
unscheduled withdrawals. An unscheduled withdrawal will reduce the Contract
Value and affect the amount of future payments. Upon the death of the Annuitant
(and Joint Annuitant, if applicable), the remaining Contract Value will be paid
in a lump sum to the beneficiary.
OPTION M - UNIT REFUND VARIABLE LIFE ANNUITY
This option provides variable monthly payments as long as the Annuitant lives.
In the event of the death of the Annuitant, the monthly payments will stop and
the beneficiary will receive a lump payment equal to the value of the remaining
Annuity Units. This value is equal to the sum of the number of remaining Annuity
Units for each Subaccount multiplied by the current Annuity Unit Value for that
Subaccount. The number of remaining Annuity Units for each Subaccount will be
calculated as follows:
(1) the net amount in the Subaccount applied under this option on the first
Payment Calculation Date divided by the corresponding Annuity Unit Value on
that date, minus
(2) the sum of the Annuity Units released from the Subaccount to make the
payments under this option.
You may not transfer any assets under Option M, unless We agree otherwise.
OPTION N - VARIABLE NON-REFUND LIFE ANNUITY
A variable payout annuity payable monthly while the Annuitant is living. No
monthly payment, death benefit, or refund is payable after the death of the
Annuitant.
OTHER OPTIONS
We may offer other annuity payment options or alternative versions of the
options listed above.
PAYMENT OPTION TABLES AND RATES
The tables in this section show the guaranteed minimum monthly payments for
Options A-G, and the minimum initial payment for the Variable Payment Options I,
J, K M and N for each $1,000 applied. These rates are based on the Annuitant's
age and sex. If Our rates in effect on the first Payment Calculation Date are
more favorable, We will use those rates. Subsequent monthly payments for the
Variable Payment Options will vary and may be higher or lower than the first
payment. Amounts for payment frequencies, periods, ages and any current rate
information not shown will be provided upon request.
The term "age" as used in the tables refers to the actual age of the Annuitant
on the first Payment Calculation Date.
11
OPTIONS A & E--LIFE ANNUITY WITH SPECIFIED PERIOD CERTAIN; INSTALLMENT REFUND LIFE ANNUITY
------------ --------------------------- -------------------------- -------------------------
INSTALLMENT REFUND 10 YEARS CERTAIN 20 YEARS CERTAIN
------------ --------------------------- -------------------------- -------------------------
AGE MALE FEMALE MALE FEMALE MALE FEMALE
------------ ------------- ------------- ------------ ------------- ------------ ------------
40 $3.28 $3.15 $3.32 $3.17 $3.31 $3.16
------------ ------------- ------------- ------------ ------------- ------------ ------------
45 3.44 3.28 3.51 3.31 3.48 3.30
------------ ------------- ------------- ------------ ------------- ------------ ------------
50 3.64 3.45 3.73 3.50 3.69 3.48
------------ ------------- ------------- ------------ ------------- ------------ ------------
55 3.88 3.66 4.02 3.73 3.94 3.70
------------ ------------- ------------- ------------ ------------- ------------ ------------
60 4.18 3.92 4.39 4.03 4.23 3.96
------------ ------------- ------------- ------------ ------------- ------------ ------------
65 4.56 4.25 4.88 4.43 4.56 4.29
------------ ------------- ------------- ------------ ------------- ------------ ------------
70 5.03 4.68 5.50 4.96 4.90 4.66
------------ ------------- ------------- ------------ ------------- ------------ ------------
75 5.63 5.24 6.24 5.66 5.19 5.03
------------ ------------- ------------- ------------ ------------- ------------ ------------
80 6.40 5.97 7.12 6.55 5.41 5.33
------------ ------------- ------------- ------------ ------------- ------------ ------------
85 7.43 6.96 8.06 7.60 5.50 5.48
------------ ------------- ------------- ------------ ------------- ------------ ------------
OPTION B--NON-REFUND LIFE ANNUITY
--------------- ------------ ------------
AGE MALE FEMALE
--------------- ------------ ------------
40 $3.33 $3.17
--------------- ------------ ------------
45 3.51 3.32
--------------- ------------ ------------
50 3.75 3.50
--------------- ------------ ------------
55 4.05 3.74
--------------- ------------ ------------
60 4.44 4.05
--------------- ------------ ------------
65 4.97 4.46
--------------- ------------ ------------
70 5.70 5.03
--------------- ------------ ------------
75 6.68 5.85
--------------- ------------ ------------
80 8.05 7.02
--------------- ------------ ------------
85 10.03 8.77
--------------- ------------ ------------
OPTION D--JOINT AND SURVIVORSHIP LIFE ANNUITY
----------------------------------------------------------------------------------------------
FEMALE MALE AGE
----------------------------------------------------------------------------------------------
AGE 40 45 50 55 60 65 70 75
----------------------------------------------------------------------------------------------
40 $3.04 $3.08 $3.11 $3.13 $3.14 $3.15 $3.16 $3.16
----------------------------------------------------------------------------------------------
45 3.11 3.16 3.21 3.24 3.27 3.28 3.30 3.30
----------------------------------------------------------------------------------------------
50 3.16 3.24 3.31 3.37 3.41 3.44 3.47 3.48
----------------------------------------------------------------------------------------------
55 3.21 3.31 3.41 3.50 3.58 3.63 3.67 3.70
----------------------------------------------------------------------------------------------
60 3.24 3.37 3.50 3.63 3.75 3.84 3.92 3.97
----------------------------------------------------------------------------------------------
65 3.27 3.41 3.57 3.74 3.91 4.07 4.20 4.30
----------------------------------------------------------------------------------------------
70 3.29 3.45 3.63 3.84 4.07 4.30 4.51 4.69
----------------------------------------------------------------------------------------------
75 3.30 3.47 3.67 3.91 4.19 4.50 4.83 5.13
----------------------------------------------------------------------------------------------
OPTION F--JOINT AND SURVIVORSHIP LIFE ANNUITY WITH 10-YEAR PERIOD CERTAIN
---------------------------------------------------------------------------------------------
FEMALE MALE AGE
---------------------------------------------------------------------------------------------
AGE 40 45 50 55 60 65 70 75
---------------------------------------------------------------------------------------------
40 $3.04 $3.08 $3.11 $3.13 $3.14 $3.15 $3.16 $3.16
---------------------------------------------------------------------------------------------
45 3.11 3.16 3.21 3.24 3.27 3.28 3.30 3.30
---------------------------------------------------------------------------------------------
50 3.16 3.24 3.31 3.37 3.41 3.44 3.47 3.48
---------------------------------------------------------------------------------------------
55 3.21 3.31 3.41 3.50 3.58 3.63 3.67 3.70
---------------------------------------------------------------------------------------------
60 3.24 3.37 3.50 3.63 3.75 3.84 3.92 3.97
---------------------------------------------------------------------------------------------
65 3.27 3.41 3.57 3.74 3.91 4.07 4.20 4.29
---------------------------------------------------------------------------------------------
70 3.29 3.45 3.63 3.84 4.07 4.30 4.51 4.68
---------------------------------------------------------------------------------------------
75 3.30 3.47 3.67 3.91 4.19 4.50 4.81 5.10
---------------------------------------------------------------------------------------------
12
OPTION G--PAYMENTS FOR A SPECIFIED PERIOD
-------------------- ----------------- ------------------
ANNUAL MONTHLY
NUMBER OF YEARS INSTALLMENT INSTALLMENT
-------------------- ----------------- ------------------
5 $211.99 $17.91
-------------------- ----------------- ------------------
6 179.22 15.14
-------------------- ----------------- ------------------
7 155.83 13.16
-------------------- ----------------- ------------------
8 138.31 11.68
-------------------- ----------------- ------------------
9 124.69 10.53
-------------------- ----------------- ------------------
10 113.82 9.61
-------------------- ----------------- ------------------
11 104.93 8.86
-------------------- ----------------- ------------------
12 97.54 8.24
-------------------- ----------------- ------------------
13 91.29 7.71
-------------------- ----------------- ------------------
14 85.95 7.26
-------------------- ----------------- ------------------
15 81.33 6.87
-------------------- ----------------- ------------------
16 77.29 6.53
-------------------- ----------------- ------------------
17 73.74 6.23
-------------------- ----------------- ------------------
18 70.59 5.96
-------------------- ----------------- ------------------
19 67.78 5.73
-------------------- ----------------- ------------------
20 65.26 5.51
-------------------- ----------------- ------------------
25 55.76 4.71
-------------------- ----------------- ------------------
30 49.53 4.18
-------------------- ----------------- ------------------
OPTION I--VARIABLE PAYMENT LIFE ANNUITY WITH 10-YEAR PERIOD CERTAIN
--------------- ------------ ------------
AGE MALE FEMALE
--------------- ------------ ------------
40 $4.15 $4.02
--------------- ------------ ------------
45 4.29 4.12
--------------- ------------ ------------
50 4.40 4.27
--------------- ------------ ------------
55 4.73 4.46
--------------- ------------ ------------
60 5.06 4.71
--------------- ------------ ------------
65 5.51 5.05
--------------- ------------ ------------
70 6.08 5.52
--------------- ------------ ------------
75 6.79 6.17
--------------- ------------ ------------
80 7.65 6.99
--------------- ------------ ------------
85 8.57 7.98
--------------- ------------ ------------
OPTION J--JOINT SURVIVOR VARIABLE PAYMENT LIFE ANNUITY WITH 10-YEAR PERIOD CERTAIN
-----------------------------------------------------------------------------------------------
FEMALE MALE AGE
AGE 40 45 50 55 60 65 70 75
-----------------------------------------------------------------------------------------------
40 $3.92 $3.94 $3.96 $3.98 $3.99 $4.00 $4.00 $4.01
-----------------------------------------------------------------------------------------------
45 3.96 4.00 4.03 4.06 4.08 4.09 4.10 4.11
-----------------------------------------------------------------------------------------------
50 4.00 4.05 4.10 4.15 4.18 4.21 4.23 4.24
-----------------------------------------------------------------------------------------------
55 4.03 4.10 4.18 4.24 4.30 4.35 4.39 4.41
-----------------------------------------------------------------------------------------------
60 4.06 4.15 4.25 4.34 4.43 4.52 4.58 4.63
-----------------------------------------------------------------------------------------------
65 4.09 4.19 4.31 4.44 4.57 4.70 4.81 4.90
-----------------------------------------------------------------------------------------------
70 4.11 4.22 4.36 4.53 4.70 4.89 5.07 5.22
-----------------------------------------------------------------------------------------------
75 4.12 4.75 4.41 4.60 4.82 5.07 5.34 5.59
-----------------------------------------------------------------------------------------------
OPTION K--VARIABLE PAYMENT ANNUITY FOR A SPECIFIED PERIOD
-------------------- ----------------- ------------------
NUMBER OF ANNUAL MONTHLY
YEARS INSTALLMENT INSTALLMENT
-------------------- ----------------- ------------------
5 $217.98 $18.53
-------------------- ----------------- ------------------
6 185.53 15.77
-------------------- ----------------- ------------------
7 162.39 13.81
-------------------- ----------------- ------------------
8 145.08 12.34
-------------------- ----------------- ------------------
9 131.65 11.19
-------------------- ----------------- ------------------
13
-------------------- ----------------- ------------------
NUMBER OF ANNUAL MONTHLY
YEARS INSTALLMENT INSTALLMENT
-------------------- ----------------- ------------------
10 120.94 10.28
-------------------- ----------------- ------------------
11 112.20 9.54
-------------------- ----------------- ------------------
12 104.94 8.92
-------------------- ----------------- ------------------
13 98.83 8.40
-------------------- ----------------- ------------------
14 93.61 7.96
-------------------- ----------------- ------------------
15 89.10 7.58
-------------------- ----------------- ------------------
16 85.18 7.24
-------------------- ----------------- ------------------
17 81.74 6.95
-------------------- ----------------- ------------------
18 78.70 6.69
-------------------- ----------------- ------------------
19 75.99 6.46
-------------------- ----------------- ------------------
20 73.57 6.25
-------------------- ----------------- ------------------
25 64.53 5.49
-------------------- ----------------- ------------------
30 58.75 5.00
-------------------- ----------------- ------------------
OPTION M--VARIABLE PAYMENT LIFE ANNUITY WITH UNIT REFUND
--------------- ------------ ------------
AGE MALE FEMALE
--------------- ------------ ------------
40 $4.12 $4.01
--------------- ------------ ------------
45 4.25 4.11
--------------- ------------ ------------
50 4.42 4.24
--------------- ------------ ------------
55 4.64 4.41
--------------- ------------ ------------
60 4.92 4.64
--------------- ------------ ------------
65 5.28 4.94
--------------- ------------ ------------
70 5.74 5.33
--------------- ------------ ------------
75 6.32 5.86
--------------- ------------ ------------
80 7.07 6.55
--------------- ------------ ------------
85 8.01 7.43
--------------- ------------ ------------
OPTION N--VARIABLE PAYMENT LIFE ANNUITY
--------------- ------------ ------------
AGE MALE FEMALE
--------------- ------------ ------------
40 $4.15 $4.02
--------------- ------------ ------------
45 4.30 4.13
--------------- ------------ ------------
50 4.50 4.27
--------------- ------------ ------------
55 4.76 4.47
--------------- ------------ ------------
60 5.11 4.73
--------------- ------------ ------------
65 5.60 5.09
--------------- ------------ ------------
70 6.29 5.60
--------------- ------------ ------------
75 7.20 6.34
--------------- ------------ ------------
80 8.49 7.41
--------------- ------------ ------------
85 10.30 8.98
--------------- ------------ ------------
/s/Xxxx X. Xxxxxx 8/16/01
--------------------------------------------------------------------------------
Xxxx X. Xxxxxx, FSA, MAAA Date
Associate Actuary
14
