EXHIBIT 99.(b)(4)(b)
COUNTRY INVESTORS LIFE ASSURANCE COMPANY
0000 X Xxxxxxx Xxxxxx, XX Xxx 0000
Xxxxxxxxxxx, XX 00000-0000
Phone (000) 000-0000
VARIABLE SETTLEMENT AGREEMENT
COUNTRY Investors Life Assurance Company, referred to
in this agreement as "We", "Us", "Our", or the
"Company", will pay the benefits of this agreement
subject to all of its terms.
This agreement supplements the original contract.
Unless otherwise stated, terms used in this agreement
have the same meaning as such terms when used in the
original contract.
For service or information on this agreement, contact
Our agent, agency office or Our Variable Product
Service Center, [PO Xxx 0000, Xxx Xxxxxx, Xxxx
00000-0000, phone 000-000-0000, fax 000-000-0000].
The provisions on the following pages are a part of
this agreement.
PAYMENTS MADE FROM FUNDS ALLOCATED TO THE SEPARATE
ACCOUNT ARE BASED ON THE INVESTMENT EXPERIENCE OF THAT
ACCOUNT AND MAY INCREASE OR DECREASE DAILY. THESE
PAYMENTS ARE NOT GUARANTEED AS TO DOLLAR AMOUNTS.
/s/ [ILLEGIBLE] /s/ [ILLEGIBLE]
Secretary President
CI-VAAGRMNT-04
CONTRACT CONTENTS
PAGE NO.
Introduction to Contract Cover
Variable Settlement Election Form 1
SECTION I - DEFINITIONS
Annuity Xxxx 0
Assumed Interest Rate 3
Effective Date 3
Fixed Interest Option 3
Fund 3
General Account 3
Owner 3
Payee 3
Proceeds 3
SEC 3
Valuation Period 3
Variable Account 3
We, Us, Our, and Company 3
You and Your 3
SECTION II - THE CONTRACT
This is a Contract 4
Change or Waiver of Terms 4
Misstatement of Age or Sex 4
Assignment 4
Payments During Minority 4
Payments to Trustee 4
Claims of Creditors 4
Non-Segregation of Funds 4
SECTION III - SETTLEMENT AND PAYMENT OF PROCEEDS
Settlement Options 4
Allocation 4
Exchanges of Annuity Units 5
Surrender 5
Cash Surrender Value 5
Delay of Payment 5
Amount of Variable Payments 5
Annuity Unit Value 6
Net Investment Factor 6
Settlement Benefit 6
Minimum Amounts 7
SECTION IV - VARIABLE ACCOUNT
Variable Account 7
SECTION I
DEFINITIONS
The following section defines certain terms used in this agreement. Please refer
to Your original contract for definitions of other terms.
ANNUITY UNIT An accounting unit of measure used to calculate
the amount of payments.
ASSUMED INTEREST The assumed interest rate in the Variable Settlement
RATE AND FACTOR Option Tables is 5% per year. The daily assumed
interest factor derived from an Assumed Interest Rate
of 5% is 0.9998663. We may also offer other Assumed
Interest Rates and other Variable Settlement Options
from time to time, which may be available at the time
You elect a settlement option.
EFFECTIVE DATE The date of which the Proceeds are applied to a
settlement option.
FIXED INTEREST An option whereby payments made are based on a
OPTION guaranteed interest rate equal to the Assumed Interest
Rate. The Fixed Interest Option is supported by the
General Account.
FUND The Investment Options shown on Page 1 of this
agreement. The corresponding Funds are registered with
the SEC under the Investment Company Act of 1940 as an
open-end diversified management investment company or
unit investment trust in which the Account invests.
GENERAL ACCOUNT All Our assets other than those allocated to the
Variable Account or any other Separate Account. We have
complete ownership and control of the assets of the
General Account.
OWNER The person who own owns the original contract and this
agreement and who is entitled to exercise all rights
and privileges provided in the original contract and
this agreement. The original Owner is the primary Payee
as shown on Page 1.
PAYEE The primary Payee(s) as named on Page 1 of this
agreement. Upon the death of the primary Payee, it
means any contingent Payees who become Payees under
this agreement. The interest of any Payee in a class
who dies before You will pass to any survivors of the
class, share and share alike, unless otherwise provided
on Page 1 of this agreement. If no Payee in a class
survives, We will pay the Proceeds to the next
contingent Payee(s). If no contingent Payee survives,
We will pay the Proceeds to the estate of the last
Payee to die.
PROCEEDS The total amount You apply to a Fixed or Variable
Settlement Option on the Effective Date of this
agreement.
SEC The U.S. Securities and Exchange Commission.
VALUATION PERIOD The period between the close of business on a Business
Day and the close of business on the next Business Day.
VARIABLE ACCOUNT The same Variable Account as described in the original
contract and is subject to the same provisions as
described in the original contract. It is registered
with the SEC under the Investment Company Act of 1940
as a unit investment trust.
WE, US, OUR, AND COUNTRY Investors Life Assurance Company.
COMPANY
YOU OR YOUR The Payee.
3
SECTION II
THE CONTRACT
THIS IS A CONTRACT This is a legal contract between the Owner and the
Company. The entire contract includes the original
contract and other attached papers, if any, which by
this agreement, form the entire agreement.
CHANGE OR WAIVER OF No change or waiver of any terms will be valid unless
TERMS it is in writing and signed by Our President, Vice
President, Secretary, Assistant Secretary, or Actuary.
MISSTATEMENT OF We have the right to reduce future payments for
AGE OR SEX misstated Age or sex. The total payments will never
exceed the total of all payments which would have been
paid had Your Age and sex been stated correctly.
ASSIGNMENT Neither the Payee nor the Owner can assign the Proceeds
or the payments of this agreement to another party.
PAYMENTS DURING Except as provided by statute, any payments due a minor
MINORITY Payee shall be paid to the legal guardian of such
minor. Any privilege of a minor Payee to withdraw or
change this agreement may be exercised only through the
legal guardian of such minor Payee.
PAYMENTS TO TRUSTEE Any payment made to a trustee(s) will be subject to the
following:
1. Evidence of qualification of the trust must be
furnished to Us within 90 days of the effective
date such payment is due.
2. Such payment will be made to the executor or
administrator of the estate of the deceased Payee
if evidence of qualification is not provided
within such 90 days or if such trustee(s) disclaim
all right to receive such payment.
It is understood and agreed that the Company is not a
party to or bound by the conditions of the trust.
Payment to such trustee(s), or to the executor or
administrator, if for any reason such trustee(s) does
not qualify as provided herein, will be a complete
discharge of the Company's obligations hereunder to the
extent of the payments made. The Company will be under
no further obligation to oversee administration of such
payments.
CLAIMS OF CREDITORS Payments to any Payee(s) will be exempt from the claims
of creditors to the maximum extent allowed by law.
NON-SEGREGATION OF Any Proceeds held by Us in the Fixed Interest Option of
FUNDS this agreement may be mingled with the general funds of
the Company. We will not be under any duty or
requirement to segregate or separately invest the
Proceeds of the fixed account.
SECTION III
SETTLEMENT AND PAYMENT OF PROCEEDS
SETTLEMENT OPTIONS The settlement option the Payee has chosen is listed on
Page 1 of this agreement. Under this option, payments
may be made on a fixed dollar basis, a variable basis,
or a combination of both.
ALLOCATION On the Effective Date, the Payee will determine the
percentage of Proceeds that will be allocated to the
Subaccounts and to the Fixed Interest Option. Any
allocation must be for at least 10% of the Proceeds. A
fractional percent may not be chosen.
4
EXCHANGES OF The Payee may exchange Annuity Units of one Subaccount
ANNUITY UNITS for those of another on a dollar equivalent basis.
The following rules apply to exchanges:
1. the exchange request may be by telephone or in
writing on a form acceptable to Us;
2. the exchange will take effect as of the end of the
Valuation Period during which We receive the
request at Our Variable Product Service Center;
and
3. the Payee may exchange Annuity Units among the
Subaccounts an unlimited number of times in a
Contract Year.
SURRENDER The Payee may make a surrender under this agreement and
receive the Cash Surrender Value, if any, subject to
the following rules:
1. The Payee must send a written request to Us along
with such information or evidence as may be
required by law or as may be needed to process the
request;
2. Surrender can only be made during the period in
which We guarantee variable annuity payments for a
specified number of years;
3. We have the right to defer payment of a surrender
from the Fixed Interest Option for up to 6 months;
4. Upon surrender, the contract will terminate.
The Payee may not make a partial withdrawal.
CASH SURRENDER VALUE The value payable at full surrender of the Variable
Settlement Option will be equal to the commuted value
of payments remaining in the guaranteed period, if any.
The interest rate used to compute the commuted value of
any unpaid payments remaining in the guaranteed period
will be the Assumed Interest Rate. Each payment under a
Variable Settlement Option will be assumed to be equal
to the number of Annuity Units times the applicable
annuity unit value.
DELAY OF PAYMENT Proceeds from surrenders will usually be mailed to the
Payee within 7 days after the Payee's signed request is
received in Our Variable Product Service Center. We
will usually mail any death claim Proceeds within 7
days after We receive Due Proof of Death. We have the
right to delay such payment whenever:
1. the New York Stock Exchange is closed other than
on customary weekends and any holiday closing;
2. trading on the New York Stock Exchange is
restricted as determined by the SEC;
3. the SEC, by order, permits postponement for the
protection of contract owners; or
4. as a result of an emergency, as determined by the
SEC, it is not reasonably possible to dispose of
securities or to determine the value of the net
assets of the Variable Account.
AMOUNT OF VARIABLE The amount of the first payment under a Variable
PAYMENTS Settlement Option is equal to:
1. the number of thousands of dollars of Proceeds
applied to the option; TIMES
5
2. the factor per $1,000 for the option, from the
Variable Settlement Option Tables.
The amount of each later payment is equal to the sum
for each Subaccount of the number of Annuity Units
times the applicable annuity unit value as of the end
of the Valuation Period on the payment date selected.
ANNUITY UNIT VALUE The number of Annuity Units credited under a Variable
Settlement Option for each Subaccount is equal to:
1. the amount of the first payment; TIMES
2. the initial Subaccount percentage allocation;
DIVIDED BY
3. the applicable annuity unit value as of the
option's effective date.
The number of Annuity Units remains constant. However,
if You exchange Annuity Units among the Subaccounts,
the units are exchanged on a dollar equivalent basis.
The annuity unit values depend on the Assumed Interest
Rate and on the net investment factor. An annuity unit
value is determined for each Subaccount for each
Valuation Period. The annuity unit value of each
Subaccount for its first Valuation Period was set at
$1.00. Each annuity unit value for each later Valuation
Period is equal to:
1. the annuity unit value for the immediately
preceding Valuation Period; TIMES
2. the net investment factor for that Valuation
Period; TIMES
3. the daily assumed interest factor for each day in
that Valuation Period.
NET INVESTMENT The net investment factor for each Subaccount for each
FACTOR Valuation Period is determined by dividing "1" by "2"
and subtracting "3" from the result, where:
1. is equal to:
a. the net asset value of the Subaccount as
of the end of the Valuation Period; PLUS
b. the amount of all investment income and
capital gains, realized or unrealized,
credited to the net assets of the
Subaccount during the Valuation Period;
MINUS
c. the amount of capital losses, realized
or unrealized, charged against the net
assets during the Valuation Period;
MINUS
d. the amount charged against the
Subaccount for taxes, or any amount set
aside during the Valuation Period by the
Company as a provision for taxes
attributable to the operation or
maintenance of the Subaccount;
2. is equal to the net asset value of the Subaccount
for the immediately preceding Valuation Period;
3. is a charge no greater than 0.0038091% of the net
assets in the Subaccount for each day in the
Valuation Period.
SETTLEMENT BENEFIT While You live, We will pay You an income beginning on
the Effective Date. If You live before all guaranteed
payments have been made, any remaining amounts will be
paid as shown on Page 1 of this agreement.
6
MINIMUM AMOUNTS We reserve the right:
1. to refuse to accept or retain an amount of
Proceeds of less than $5,000; and
2. if payments as provided in this agreement will be
less than $100 each, to make payments at less
frequent intervals.
SECTION IV
VARIABLE ACCOUNT
VARIABLE ACCOUNT The Variable Account under this agreement is the same
as the Variable Account under the original contract. We
own the assets of the Variable Account. We will value
the assets of the Variable Account each Business Day.
The Variable Account is divided into Subaccounts. The
Subaccounts are listed on Page 1 of this agreement. The
Payee will determine the percentage of Proceeds that
will be allocated to each Subaccount. The Fund has
several Investment Options each of which corresponds to
one of the Subaccounts of the Variable Account. The
Investment Options are listed on Page 1 of this
agreement. Amounts allocated to a Subaccount will
automatically be invested in the fund investment option
associated with that Subaccount. The Payee will share
only in the income, gains or losses of the Investment
Option(s) where shares are held.
7
VARIABLE SETTLEMENT AGREEMENT
PAYMENTS MADE FROM FUNDS ALLOCATED TO THE SEPARATE ACCOUNT ARE BASED ON THE
INVESTMENT EXPERIENCE OF THAT ACCOUNT AND MAY INCREASE OR DECREASE DAILY. THESE
PAYMENTS ARE NOT GUARANTEED AS TO DOLLAR AMOUNTS.
