PLEASE READ THIS CONTRACT CAREFULLY
THIS CONTRACT PROVIDES A PAYMENT CREDIT THAT MAY BE RECAPTURED UNDER CERTAIN
CIRCUMSTANCES IN THE FIRST CONTRACT YEAR.
ANNUITY BENEFIT PAYMENTS AND OTHER VALUES PROVIDED BY THIS CONTRACT, WHEN BASED
ON THE INVESTMENT PERFORMANCE OF THE VARIABLE ACCOUNT, MAY INCREASE OR DECREASE
AND ARE NOT GUARANTEED AS TO FIXED DOLLAR AMOUNT. PLEASE REFER TO THE VALUE OF
THE VARIABLE ACCOUNT SECTION FOR ADDITIONAL INFORMATION.
Values removed from a Guarantee Period Account prior to the end of its Guarantee
Period may be subject to a Market Value Adjustment that may increase or decrease
the values. A negative Market Value Adjustment will never be applied to the
Death Benefit. A positive Market Value Adjustment, if applicable, will be added
to the Death Benefit when the benefit paid is the contract's Accumulated Value.
Please refer to the Market Value Adjustment section for additional information.
RIGHT TO EXAMINE CONTRACT
IF THIS CONTRACT WAS NOT SOLD AS PART OF A REPLACEMENT: The Owner may cancel
this contract by returning it to the Company or one of its authorized
representatives within ten days after receipt. The Company will refund an amount
equal to the Accumulated Value, after application of any Market Value
Adjustment, plus any fees and other charges and less the Payment Credit
Recapture Amount. (See Payment Credit Recapture provision in "The Accumulation
Phase.") This refund amount may be more or less than gross payments to the
contract. If, however, the contract is issued as an Individual Retirement
Annuity (IRA), the Company will refund the greater of the above or gross
payments.
IF THIS CONTRACT WAS SOLD AS PART OF A REPLACEMENT: The Owner may cancel this
contract by returning it to the Company or one of its authorized representatives
within twenty days after receipt. The Company will refund an amount equal to
gross payments less any withdrawals taken.
ALLMERICA FINANCIAL LIFE INSURANCE AND ANNUITY COMPANY
Home Office: Dover, Delaware
Principal Office: 000 Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxxxxx 00000
This is a legal contract between Allmerica Financial Life Insurance and Annuity
Company (the Company) and the Owner and is issued in consideration of the
Initial Payment shown on the Specifications page. Additional Payments are
permitted. Payments may be allocated to Variable Sub-Accounts, the Fixed Account
or Guarantee Period Accounts.
/s/ Xxxx X. Xxx /s/ Xxxxxxx X. Xxxxxx
--------------- ---------------------
President Secretary
Flexible Payment Deferred Variable and Fixed Annuity
Annuity Benefit Payments Payable on the Annuity Date
Death Benefit Payable if death occurs prior to Annuity Date
(see Death Benefits section)
Non-Participating
Form A3038-02 bascb2-10
TABLE OF CONTENTS (WILL NEED TO FINALIZE AT LATER DATE)
SPECIFICATIONS ...............................................................................................3
DEFINITIONS...................................................................................................7
OWNER, ANNUITANT AND BENEFICIARY..............................................................................9
THE ACCUMULATION PHASE
PAYMENTS............................................................................................11
PAYMENT CREDITS......................................................................................X
VALUES..............................................................................................11
VALUE ENHANCEMENT....................................................................................X
TRANSFER............................................................................................13
XXXXXXXXXX AND SURRENDER............................................................................14
DEATH BENEFIT.......................................................................................16
PAYMENT CREDIT RECAPTURE.............................................................................X
THE PAYOUT PHASE
ANNUITY BENEFIT.....................................................................................18
TRANSFER............................................................................................20
WITHDRAWAL..........................................................................................20
PRESENT VALUE OF ANNUITY BENEFIT PAYMENTS...........................................................22
DEATH OF THE ANNUITANT..............................................................................22
ANNUITY BENEFIT PAYMENT OPTIONS.....................................................................22
LIFE ANNUITY GUARANTEE OPTIONS......................................................................23
ANNUITY OPTION RATE TABLES..........................................................................23
GENERAL PROVISIONS...........................................................................................27
2
SPECIFICATIONS
Contract Type: [NQ] Contract Number: [zz00600000]
Issue Date: [01/01/02] Annuity Date: [01/01/2035]
Owner: [Xxxx Xxx] Owner Date of Birth: [01/01/1950]
Joint Owner: [Xxxx Xxx] Joint Owner Date of Birth: [01/01/1950]
Annuitant: [Xxxx Xxx] Xxxxxxxxx Date of Birth: [01/01/1950]
Joint Annuitant: [Xxxx Xxx] Joint Annuitant Date of Birth: [01/01/1950]
Annuitant Sex: [Male] Beneficiary(ies):
Joint Annuitant Sex: [Male] Primary: Surviving Joint Owner, if any
1st Contingent: [Xxxx Xxx]
2nd Contingent: [Xxx Xxx]
Payment Credit Percentage: [4%] (for each Payment made before the first contract anniversary)
[2%] (for each Payment made on or after the first contract anniversary)
Value Enhancement Percentage: [2%]
Value Enhancement Date: every [5th] contract anniversary
Minimum Fixed Account
Guaranteed Interest Rate: [3%]
Minimum Additional Payment Maximum Additional Payment
Amount: [$50.00] Amount: [$2,000,000]
Guarantee Period Account Guarantee Period Account
Minimum Interest Rate: [3%] Minimum Allocation Amount: [$1,000.00]
Minimum Withdrawal Minimum Accumulated Value
Amount: [$100.00] After Withdrawal: [$1,000.00]
Minimum Annuity Maximum Alternative Annuity Date: [01/01/2049]
Benefit Payment: [$100.00]
3
SPECIFICATIONS (CONTINUED)
Surrender Charge Table:
Years From Surrender Charge as a
Date of Payment Percent of the Payments
To Date of Withdrawal Withdrawn
--------------------------------------------
[Less Than: 1 8.5%
2 8.5%
3 8.5%
4 8.5%
5 7.5%
6 6.5%
7 5.5%
8 3.5%
9 1.5%
Thereafter 0%]
Payment Credit Recapture Table:
Years From Payment Credit Recapture Amount
Date of Payment as a Percent of the Payments
To Date of Withdrawal Withdrawn
--------------------------------------------
[Less Than: 1 4.0%]
Withdrawal Without Surrender Charge Percentage: [15%]
Mortality and Expense Risk Charge: [1.45%] on an annual basis of the daily value
of the Sub-Account assets.
Administrative Charge: [.15%] on an annual basis of the daily value of the
Sub-Account assets.
Contract Fee: [$35, if the Accumulated Value is less than $75,000.00. Waived for
401(k)s.]
Principal Office: 000 Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxxxxx 00000
[(1-800-xxx-xxxx)]
4
SPECIFICATIONS (CONTINUED)
Owner: [Xxxx Xxx ] Contract Number: [zzz0000000]
Joint Owner: [Xxxx Xxx]
Initial Payment: [$10,000.00]
Payment Allocation: (The Initial Payment is allocated in the following manner:)
Variable Sub-Accounts: Need to change to Xxxxxxx funds
---------------------
[Select Emerging Markets Fund Fidelity VIP Growth Portfolio
Select International Equity Fund Select Growth Fund
Xxxxxxxxxxx Global Securities Fund VA Allmerica Core Equity Fund
FT VIP Xxxxxxxxx Foreign Securities Fund Allmerica Equity Index Fund
MFS New Discovery Series AIM V.I. Blue Chip Fund
AIM V.I. Aggressive Growth Fund FT VIP Franklin Large Cap Growth Securities Fund
FT VIP Small Cap Fund Alliance Growth & Income Portfolio
Select Strategic Growth Fund MFS Total Return Series
Alliance Xxxxxxxxx Small Cap Value Portfolio MFS Utilities Series
Fidelity VIP Value Strategies Portfolio Xxxxxxxxxxx Main Street Growth & Income Fund VA
FT VIP Small Cap Value Securities Fund Fidelity VIP Contrafund
MFS Mid Cap Growth Series AIM V.I. Basic Value Fund
Fidelity VIP III Mid Cap Portfolio Xxxxxxxxxxx Multiple Strategies Fund VA
AIM V.I. Capital Development Fund Fidelity Equity Income Fund
Select Capital Appreciation Fund AllianceBernstein Value Portfolio
FT VIP Mutual Shares Securities Fund Select Growth & Income Fund
Select Value Opportunity Fund Xxxxxxxxxxx High Income Fund VA
Alliance Premier Growth Portfolio Select Investment Grade Income Fund
Alliance Technology Portfolio Select Strategic Income Fund
Xxxxxxxxxxx Capital Appreciation Fund VA Allmerica Government Bond Fund
AIM V.I. Premier Equity Fund Allmerica Money Market Fund]
Select Aggressive Growth Fund
Fixed Account:
--------------
5
SPECIFICATIONS (CONTINUED)
Owner: [Xxxx Xxx] Contract Number: [zzz0000000]
Joint Owner: [Xxxx Xxx]
Guarantee Period Accounts: Need to add hypothetical data
-------------------------
Guarantee Interest Expiration
Period Rate Date
------ ---- ----
[ 2 years
3 years
4 years
5 years
6 years
7 years
8 years
9 years
10 years]
-------
100% TOTAL PAYMENT ALLOCATION
6
SPECIFICATIONS (CONTINUED)
Owner: [Xxxx Xxx] Contract Number: [zzz0000000]
Joint Owner: [Xxxx Xxx]
================================================================================
RIDER(S) SELECTED:
[Annual Step-up Enhanced Death Benefit Rider:]
[See Rider for Benefit and Charge]
[Annual Step-up with 5% Yield Enhanced Death Benefit Rider:]
[See Rider for Benefit and Charge]
[Annual Step-up with 7% Yield Enhanced Death Benefit Rider:]
[See Rider for Benefit and Charge]
[10% Breakthrough with 5% Roll-up Enhanced Death Benefit Rider:]
[See Rider for Benefit and Charge]
[Enhanced Earnings Rider:]
[See Rider for Benefit and Charge]
[Discount Rider:]
[See Rider for details]
7
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8
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9
DEFINITIONS
Accumulated Value The aggregate value of all accounts in this
contract before the Annuity Date. As long as
the Accumulated Value is greater than zero,
the contract will stay in effect.
Accumulation Unit A measure used to calculate the value of a
Sub-Account before annuity benefit payments
begin.
Annuitant On and after the Annuity Date, the person
upon whose continuation of life annuity
benefit payments involving life contingency
depend. Joint Annuitants are permitted and
unless otherwise indicated, any reference to
Annuitant shall include Joint Annuitants.
Annuity Date The date annuity benefit payments begin. The
Annuity Date is shown on the Specifications
page.
Annuity Unit A measure used to calculate annuity benefit
payments under a variable annuity option.
Beneficiary The person, persons or entity entitled to
the Death Benefit prior to the Annuity Date
or any annuity benefit payments upon the
death of the Owner on or after the Annuity
Date.
Company Allmerica Financial Life Insurance and
Annuity Company.
Contract Year A one-year period based on the Issue Date or
an anniversary .
Cumulative Earnings Accumulated Value reduced by total Payments
not previously withdrawn.
Effective Valuation Date The Valuation Date on or immediately
following the day a payment, request for
transfer, withdrawal or surrender, or Proof
of Death is received at the Principal
Office.
Fixed Account The part of the Company's General Account to
which all or a portion of a Payment or
transfer may be allocated.
Fund Each separate investment company, investment
series or portfolio eligible for investment
by a Sub-Account of the Variable Account.
General Account All assets of the Company that are not
allocated to a Separate Account.
Gross Payment Base Total gross payments made to the contract
reduced by withdrawals which exceed the
Withdrawal Without Surrender Charge amount.
Guarantee Period The number of years that a Guaranteed
Interest Rate may be credited to a Guarantee
Period Account.
Guarantee Period Account An account which corresponds to a Guaranteed
Interest Rate for a specified Guarantee
Period and is supported by assets in a
Separate Account. The Owner may only invest
in a Guarantee Period Account prior to the
Annuity Date.
Guaranteed Interest Rate The annual effective rate of interest after
daily compounding credited to a Guarantee
Period Account.
10
Market Value Adjustment A positive or negative adjustment to
earnings in a Guarantee Period Account
assessed if any portion of a Guarantee
Period Account is withdrawn or transferred
prior to the end of its Guarantee Period.
Owner The person, persons or entity entitled to
exercise the rights and privileges under
this contract. Joint Owners are permitted
and unless otherwise indicated, any
reference to Owner shall include joint
Owners.
Payment Credit The amount credited to the contract by the
Company each time a Payment is made into the
contract.
Pro Rata How a Payment or withdrawal may be
allocated among the accounts. A Pro Rata
allocation or withdrawal will be made in the
same proportion that the value of each
account bears to the Accumulated Value.
Proof of Death The death certificate and all necessary
claim paperwork, as determined by the
Company.
Qualified Contract A contract that is purchased in connection
with a retirement plan which meets the
requirements of Section 401, 403, 408 or
408A of the Internal Revenue Code.
Request A request or notice made by the Owner, in a
manner consistent with the Company's current
procedures, which is received and recorded
by the Company.
Separate Account A segregated account established by the
Company. The assets in a Separate Account
are not commingled with the Company's
general assets and obligations. The assets
of a Separate Account are not subject to
claims arising out of any other business the
Company may conduct.
State The state or jurisdiction in which the
contract is issued.
Sub-Account A Variable Account subdivision that invests
exclusively in shares of a corresponding
Fund.
Surrender Value The amount payable to the Owner on full
surrender, after application of any
applicable Market Value Adjustment,
surrender charge, Contract Fee and Payment
Credit Recapture Amount.
Survivor Annuity Benefit The number of Annuity Units (under a
Percentage variable joint life annuitization option) or
the dollar value of the annuity benefit
payments (under a fixed joint life
annuitization option) paid during the
surviving Annuitant's life may be less than
or equal to the number of Annuity Units paid
when both individuals are living. The
Survivor Annuity Benefit Percentage is the
percentage of total Annuity Units or dollars
paid in each annuity benefit during the
survivor's life. For example, with a Joint
and Two-thirds Survivor Option, the Survivor
Annuity Benefit Percentage is 66 2/3 %. This
percentage is only applicable after the
death of the first Annuitant.
Valuation Date A day the values of all units are
determined. Valuation Dates occur on each
day the New York Stock Exchange is open for
trading, or such other dates when there is
sufficient trading in a Fund's portfolio
securities such that the current unit value
may be materially affected.
Valuation Period The interval between two consecutive
Valuation Dates.
11
Value Enhancement Prior to the Annuity Date, the amount
credited to the contract by the Company
on every fifth contract anniversary.
Variable Account The Company's Separate Account, consisting
of Sub-Accounts that invest in the
underlying Funds.
12
OWNER, ANNUITANT AND BENEFICIARY
Owner When the contract is issued, the Owner will
be as shown on the Specifications page. The
Owner may be changed in accordance with the
terms of this contract. Upon the death of an
Owner prior to the Annuity Date, a Death
Benefit is paid. The Maximum Alternative
Annuity Date is based upon the age of the
Owner.
The Owner may exercise all rights and
options granted in this contract or by the
Company, subject to the consent of any
irrevocable Beneficiary. Where there are
joint Owners, the consent of both is
required in order to exercise any ownership
rights.
Assignment Prior to the Annuity Date and prior to the
death of an Owner, the Owner may be changed
at any time. Only the Owner may assign this
contract. An absolute assignment will
transfer ownership to the assignee. This
contract may also be collaterally assigned
as security. The limitations on ownership
rights while the collateral assignment is in
effect are stated in the assignment.
Additional limitations may exist for
contracts issued under provisions of the
Internal Revenue Code.
An assignment will take place only when the
Company has actually received a Request in
writing and recorded the change at the
Principal Office. The Company will not be
deemed to know of the assignment until such
time. When recorded, the assignment will
take effect as of the date it was signed.
The assignment will be subject to payments
made or actions taken by the Company before
the change was recorded.
The Company will not be responsible for the
validity of any assignment nor the extent of
any assignee's interest. The interests of
the Beneficiary will be subject to any
assignment.
Annuitant When the contract is issued, the Annuitant
will be as shown on the Specifications page.
The Annuitant may be changed in accordance
with the terms of this contract. Prior to
the Annuity Date, an Annuitant may be
replaced or added unless the Owner is a non-
natural person. At all times there must be
at least one Annuitant. If the Annuitant
dies and a replacement is not named, the
Owner will be considered to be the new
Annuitant. Upon the death of an Annuitant
prior to the Annuity Date, a Death Benefit
is not paid unless the Owner is a
non-natural person.
A change of Annuitant will take place only
when the Company has actually received a
Request in writing and recorded the change
at the Principal Office. The Company will
not be deemed to know of the change of
Annuitant until such time. When recorded,
the change of Annuitant will take effect as
of the date it was signed. The change of
Annuitant will be subject to payments made
or actions taken by the Company before the
change was recorded.
13
Beneficiary The Beneficiary is as named on the
Specifications page unless subsequently
changed. The Owner may declare any
Beneficiary to be revocable or irrevocable.
A revocable Beneficiary may be changed at
any time prior to the Annuity Date and
before the death of an Owner or after the
Annuity Date and before the death of the
Annuitant. An irrevocable Beneficiary must
consent in writing to any change. Unless
otherwise indicated, the Beneficiary will be
revocable.
A Beneficiary change must be made in writing
in a form acceptable to the Company and will
be subject to the rights of any assignee of
record. When the Company receives the form,
the change will take place as of the date it
was signed, even if an Owner or the
Annuitant dies after the form is signed but
prior to the Company's receipt of the form.
Any rights created by the change will be
subject to payments made or actions taken by
the Company before the change was recorded.
All benefits payable to the Beneficiary
under this contract will be divided equally
among the surviving Beneficiaries of the
same class, unless the Owner directs
otherwise. If there is no surviving
Beneficiary in a particular class, then the
benefit is divided equally among the
surviving Beneficiaries of the next class.
If there is no surviving Beneficiary, the
deceased Beneficiary's interest will pass to
the Owner or the Owner's estate. At the
death of the first joint Owner prior to the
Annuity Date, the surviving joint Owner is
the sole, primary Beneficiary
notwithstanding that the designated
Beneficiary may be different.
The Beneficiary can not assign, transfer,
commute, anticipate or encumber the proceeds
or payments unless given that right by the
Owner.
Protection of Proceeds To the extent allowed by law, this contract
and any payments made under it will be
exempt from the claims of creditors.
14
THE ACCUMULATION PHASE
PAYMENTS
Payments Each Payment is equal to the gross payment
less the amount of any applicable premium
tax. Gross payments refers to Payments made
by the Owner. The Company reserves the right
to deduct the amount of the premium tax from
the Accumulated Value at a later date rather
than when the premium tax liability is first
incurred by the Company. In no event will
an amount be deducted for premium taxes
before the Company has incurred a tax
liability under applicable State law.
Initial Payment The Initial Payment is shown on the
Specifications page.
Additional Payments Prior to the Annuity Date and before the
death of an Owner, the Owner may make
additional Payments of at least the
Minimum Additional Payment Amount (see
Specifications page).
Payment Allocations The Initial Payment is allocated in
accordance with the Payment Allocation,
shown on the Specifications page. Each
subsequent Payment will be allocated in the
same manner unless allocation instructions
accompany the Payment or the Payment
Allocation is changed by the Owner.
The minimum amount that may be allocated to
the Guarantee Period Account is shown on the
Specifications page. If the Owner requests
an allocation less than the minimum amount,
the Company reserves the right to apply that
amount to the [money market Sub-Account.]
PAYMENT CREDITS
Each time the Owner makes a Payment to the
contract, the Company will credit an amount
equal to such Payment multiplied by the
Payment Credit Percentage (see
Specifications page). This amount will be
credited to the contract's Accumulated
Value. Each Payment Credit will be allocated
in the same manner as its corresponding
Payment.
VALUES
Value of the Variable The value of a Sub-Account on a Valuation
Account Date is determined by multiplying the
Accumulation Units in that Sub-Account by
the Accumulation Unit Value as of the
Valuation Date.
Accumulation Units are purchased when an
amount is allocated to a Sub-Account. The
number of Accumulation Units purchased
equals the amount allocated to a Sub-Account
divided by the applicable Accumulation Unit
Value as of the Valuation Date.
Accumulation Unit The value of a Sub-Account Accumulation Unit
Values as of any Valuation Date is determined by
multiplying the value of an Accumulation
Unit for the preceding Valuation Date by the
Net Investment Factor for that Valuation
Period.
Net Investment Factor The Net Investment Factor measures the
investment performance of a Sub-Account from
one Valuation Period to the next. This
factor is equal to 1.000000
15
plus the result (which may be positive or
negative) from dividing (a) by (b) and
subtracting (c) and (d) where:
(a) is the investment income of a Sub-
Account for the Valuation Period,
including realized or unrealized
capital gains and losses during the
Valuation Period, adjusted for
provisions made for taxes, if any;
(b) is the value of that Sub-Account's
assets at the beginning of the
Valuation Period;
(c) is the Mortality and Expense Risk
Charge applicable to the current
Valuation Period (see Specifications
page) plus any applicable Rider
charges; and
(d) is the Administrative Charge
applicable to the current Valuation
Period (see Specifications page).
The Company assumes the risk that its actual
mortality expense experience may exceed the
amounts provided under the contract. The
Company guarantees that the charge for
mortality and expense risks and the
administrative charge will not be increased.
Subject to applicable State and federal
laws, these charges may be decreased or the
method used to determine the Net Investment
Factor may be changed.
Value of the Fixed Amounts allocated to the Fixed Account
Account receive interest at rates periodically set
by the Company. The Company guarantees that
the initial rate of interest in effect when
an amount is allocated to the Fixed Account
will remain in effect for that amount for
one year or until such amount is transferred
out of the Fixed Account, whichever is
sooner. Thereafter, the rate of interest for
that amount will be the Company's current
interest rate, but no less than the Minimum
Fixed Account Guaranteed Interest Rate (see
Specifications page).
The value of the Fixed Account on any date
is the sum of amounts allocated to the Fixed
Account plus interest compounded and
credited daily at the rates applicable to
those amounts. The value of the Fixed
Account will be at least equal to the
minimum required by law in the State in
which this contract is delivered.
Value of the Guarantee Amounts allocated to the same Guarantee
Period Accounts Period Account on the same day will be
treated as one Guarantee Period Account. The
interest rate in effect when an amount is
allocated to a Guarantee Period Account is
guaranteed for the duration of the Guarantee
Period. Each time the Guaranteed Interest
Rate changes for a particular Guarantee
Period, a new Guarantee Period Account is
established.
The value of a Guarantee Period Account on
any date is the sum of amounts allocated to
that Guarantee Period Account plus interest
compounded and credited daily at the rate
applicable to that amount.
Guaranteed Interest The Company will periodically set Guaranteed
Rates Interest Rates for each available Guarantee
Period. These rates will be guaranteed for
the duration of the respective Guarantee
Periods. A Guaranteed Interest Rate will
never be less than the Guarantee Period
Account Minimum Interest Rate (see
Specifications page).
16
Renewal Guarantee At least 45 days (but not more than 75 days)
prior to the end a Periods Guarantee Period,
the Company will notify the Owner in writing
of the expiration of that Guarantee Period.
The Owner may transfer amounts to the
Sub-Accounts, the Fixed Account or establish
a new Guarantee Period Account of any
duration then offered by the Company as of
the day following the expiration of the
Guarantee Period. The transfer will not be
subject to a Market Value Adjustment; see
"Market Value Adjustment." Guaranteed
Interest Rates corresponding to the
available Guarantee Periods may be higher or
lower than the previous Guaranteed Interest
Rate. If reallocation instructions are not
received at the Principal Office before the
end of a Guarantee Period, the Guarantee
Period Account value will be automatically
applied to a new Guarantee Period Account
with the same Guarantee Period unless:
(a) less than the Guarantee Period
Account Minimum Allocation Amount
(see Specifications page) remains in
the Guarantee Period Account on its
expiration date; or
(b) the Guarantee Period would extend
beyond the Annuity Date or is no
longer available.
In such cases, the Guarantee Period Account
value will be transferred to the [money
market Sub-Account.]
Contract Fee Prior to the Annuity Date, on each contract
anniversary and when the contract is
surrendered, the Company will deduct a
Contract Fee (see Specifications page) Pro
Rata.
VALUE ENHANCEMENT
If the oldest Owner (or oldest Annuitant, if
the Owner is a non-natural person) is under
age 76 on the Issue Date, the Company will
credit a Value Enhancement on each Value
Enhancement Date prior to the Annuity Date.
However, the Company will not credit a Value
Enhancement after the date of death of an
Owner (or Annuitant, if the Owner is a
non-natural person), if the contract is not
continued by the deceased Owner's spouse (or
deceased Xxxxxxxxx's spouse, if the Owner is
a non-natural person).
The Value Enhancement is an amount equal to
the Accumulated Value on the Value
Enhancement Date multiplied by the Value
Enhancement Percentage (see Specifications
page). This amount will be credited to the
contract's Accumulated Value and will be
allocated Pro Rata. However, the portion of
each Value Enhancement that would have been
credited to a Guarantee Period Account (if
applicable) as a result of this Pro Rata
allocation will be credited to the [money
market Sub-Account].
TRANSFER
Prior to the Annuity Date, the Owner may
transfer amounts among accounts by Request
to the Principal Office. Transfers to a
Guarantee Period Account must be at least
equal to the Minimum Guarantee Period
Account Allocation Amount (see
Specifications page). If the Owner requests
the transfer of a smaller amount to the
Guarantee Period Account, the Company may
transfer that amount to the [money market
Sub-Account.]
Any transfer from a Guarantee Period Account
prior to the end of its Guarantee Period
will be subject to a Market Value
Adjustment.
17
There is no charge for the first twelve
transfers per contract year. A transfer
charge of up to $25 may be imposed on each
additional transfer.
The Company reserves the right to limit or
refuse transfers if it determines, in its
sole discretion, that the exercise of that
right by an Owner(s), or any agent or duly
authorized representative of such Owner(s)
is, or would be, to the disadvantage of
other Owners. Such transfer limitations
could be applied to transfers to or from
some or all of the accounts and could
include but not be limited to:
(a) the requirement of a minimum time
period between each transfer;
(b) not accepting a transfer request of
an agent or duly authorized
representative of such Owner(s)
authorized to act on behalf of such
Owner(s); and
(c) limiting the dollar amount that may
be transferred to or from any of the
accounts by an Owner(s) at any one
time.
Such limitations, individually or in
aggregate, may be applied in any manner
reasonably designed to prevent any use of
the transfer right which is considered by
the Company to be to the disadvantage of
other Owners.
XXXXXXXXXX AND SURRENDER
Prior to the Annuity Date, the Owner may, by
Request, withdraw a part of the Surrender
Value or surrender the contract for its
Surrender Value. If the Owner takes a
withdrawal or surrenders the contract prior
to the first contract anniversary, the
amount withdrawn or the Surrender Value may
be subject to a deduction for the Payment
Credit Recapture Amount. See Payment Credit
Recapture provision in "The Accumulation
Phase."
Any withdrawal must be at least the Minimum
Withdrawal Amount (see Specifications page).
A withdrawal will not be permitted if the
Accumulated Value remaining in the contract
would be less than the Minimum Accumulated
Value After Withdrawal (see Specifications
page). The Request must indicate the dollar
amount to be paid and the accounts from
which it is to be withdrawn. A withdrawal
from a Guarantee Period Account will be
subject to a Market Value Adjustment.
When surrendered, this contract terminates
and the Company has no further liability
under it. The Surrender Value will be based
on the Accumulated Value on the Effective
Valuation Date.
Amounts taken from the Variable Account will
be paid within 7 days of the date a Request
is received. The Company reserves the right
to delay payments subject to applicable
laws, rules and regulations governing
variable annuities.
Amounts taken from the Fixed Account or the
Guarantee Period Accounts will normally be
paid within 7 days of the date a Request is
received. The Company may defer payment for
up to six months from the receipt date.
If deferred for 30 days or more, the amount
payable will be credited interest at a rate
equal to the Minimum Fixed Account
Guaranteed Interest Rate (see Specifications
page), or the rate mandated by the
appropriate State.
18
Withdrawal Without In each calendar year, withdrawals up to the
Surrender Charge greater of (a) or (b) may be made without a
surrender charge where:
(a) is a percent (see Specifications
Page) of the Gross Payment Base as
of the Effective Valuation Date,
reduced by any prior Withdrawal
Without Surrender Charge made in the
same calendar year; and
(b) is, for Qualified Contracts and
contracts funding employer-sponsored
Internal Revenue Code Section 457
plans, the amount of the Life
Expectancy Distribution ("LED")
benefit available under the
Company's then current LED rules,
including withdrawals taken as a
Required Minimum Distribution
("RMD"). The LED benefit available
is reduced by any prior Withdrawal
Without Surrender Charge made in the
same calendar year. LED benefits are
based on the life expectancy of the
Owner or the joint life expectancies
of the Owner and the Beneficiary.
Withdrawal Without Surrender Charge amounts
will first be considered withdrawn from
Cumulative Earnings. To the extent that any
such amount withdrawn exceeds Cumulative
Earnings, the excess will be considered
withdrawn on a last-in, first-out basis from
Payments not previously withdrawn. Amounts
withdrawn from a Guarantee Period Account
prior to the end of the applicable Guarantee
Period will be subject to a Market Value
Adjustment.
Withdrawal With Any amounts withdrawn or surrendered in
Surrender Charge excess of the Withdrawal Without Surrender
Charge amount may be subject to a surrender
charge.
These amounts will first be considered
withdrawn on a first-in, first-out basis
from Payments not previously withdrawn.
These amounts will then be considered
withdrawn from Cumulative Earnings. The
Company will compute applicable charges
using the Surrender Charge Table (see
Specifications page).
Waiver of Surrender The surrender charge will be waived if an
Charge Owner, or the if the Owner is a non-natural
person, is:
(a) admitted to a "medical care
facility" after being named Owner
or Annuitant and remains confined
there until the later of one year
after the Issue Date or 90
consecutive days;
(b) first diagnosed by a licensed
"physician" as having a "fatal
illness" after the Issue Date and
after being named Owner or
Annuitant; or
(c) physically disabled after the Issue
Date and after being named Owner or
Xxxxxxxxx and before attaining age
65. The Company may require proof of
continuing disability, and reserves
the right to obtain an examination
by a licensed "physician" of its
choice and at its expense.
"Medical care facility" means any State
licensed facility providing medically
necessary inpatient care which is prescribed
by a licensed "physician" in writing and
based on physical limitations which prohibit
daily living in a non-institutional setting.
"Fatal illness" means a condition diagnosed
by a licensed "physician" which is expected
to result in death within two years of the
diagnosis. "Physician" means a person other
than the Owner, the Annuitant or a member of
one of their families who is State licensed
to give medical care or
19
treatment and is acting within the scope of
that license. "Physically disabled" means
the Owner or Annuitant has been unable to
engage in an occupation or to conduct daily
activities for a period of at least 12
consecutive months as a result of disease or
bodily injury.
No additional Payments are permitted after
this provision becomes effective.
Market Value Adjustment A transfer, withdrawal or surrender from a
Guarantee Period Account after the
expiration of its Guarantee Period will not
be subject to a Market Value Adjustment. A
Market Value Adjustment will apply to all
other transfers, withdrawals or surrenders
from a Guarantee Period Account. Amounts in
a Guarantee Period Account that are applied
under an Annuity Option are treated as
withdrawals when calculating the Market
Value Adjustment. The Market Value
Adjustment will be determined by multiplying
the amount taken from each Guarantee Period
Account by the market value factor. The
market value factor for each Guarantee
Period Account is equal to:
(1+I) n/365
-----
(1+j) -1
where:
i - is the Guaranteed Interest Rate
expressed as a decimal being
credited to the current Guarantee
Period;
j - is the new Guaranteed Interest
Rate, expressed as a decimal, for a
Guarantee Period with a duration
equal to the number of years
remaining in the current Guarantee
Period, rounded to the next higher
number of whole years. If that rate
is not available, the Company will
use a suitable rate or index allowed
by the Department of Insurance; and
n - is the number of days remaining
from the Effective Valuation Date to
the end of the current Guarantee
Period.
If the Guaranteed Interest Rate being
credited is lower than the new Guaranteed
Interest Rate, the Market Value Adjustment
will decrease the Guarantee Period Account
value. Similarly, if the Guaranteed Interest
Rate being credited is higher than the new
Guaranteed Interest Rate, the Market Value
Adjustment will increase the Guarantee
Period Account value. The Market Value
Adjustment will never result in a change to
the value more than the interest earned in
excess of an amount based on the Guarantee
Period Account Minimum Interest Rate (see
Specifications page).
DEATH BENEFIT
At the death of an Owner prior to the
Annuity Date, the Company will pay to the
Beneficiary a Death Benefit upon receipt at
the Principal Office of Proof of Death. If
the Owner is a non-natural person, prior to
the Annuity Date, a Death Benefit is paid on
the death of an Annuitant, upon receipt at
the Principal Office of Proof of Death.
Death Benefit The Death Benefit will be the greater of:
(a) the Accumulated Value on the
Effective Valuation Date, increased
by any positive Market Value
Adjustment; or
20
(b) the sum of the gross payments
made under this contract prior to
the date of death, proportionately
reduced to reflect all partial
withdrawals.
For each withdrawal, the
proportionate reduction is
calculated by multiplying the Death
Benefit under the (b) option,
immediately prior to the withdrawal,
by the following:
Amount of the withdrawal
------------------------
Accumulated Value immediately
prior to the withdrawal
If an Owner (or an Annuitant, if the Owner
is a non-natural person), dies prior to the
first contract anniversary, the Death
Benefit will include a deduction for the
Payment Credit Recapture Amount. See Payment
Credit Recapture provision in "The
Accumulation Phase."
Payment of the Death Unless the Owner has specified that the
Benefit Death Benefit be under another settlement
option that satisfies the of Section 72(s)
of the Internal Revenue Code, the Death
Benefit will be paid to the Beneficiary
within 7 days of the Effective Valuation
Date. Alternatively, if the Owner has not
specified otherwise, the Beneficiary may, by
a Request in writing, elect to:
(a) defer distribution of the Death
Benefit for a period no more than 5
years from the date of death; or
(b) receive distributions over his/her
life expectancy (or over a period
not extending beyond such life
expectancy). Distributions must
begin within one year from the date
of death.
If distribution of the Death Benefit is
deferred under (a) or (b), any value in
Guarantee Period Accounts will be
transferred to the [money market
Sub-Account]. The excess, if any, of the
Death Benefit over the Accumulated Value
will also be transferred to the [money
market Sub-Account.] The Beneficiary may, by
a Request, effect transfers and withdrawals,
but may not make additional Payments. If
there are multiple Beneficiaries, the
consent of all is required.
If the sole Beneficiary is the deceased
Owner's spouse, the Beneficiary may, by a
Request in writing, continue the contract
and become the new Owner and Annuitant
subject to the following:
(a) any value in the Guarantee Period
Accounts will be transferred to the
[money market Sub-Account];
(b) the excess, if any, of the Death
Benefit over the contract's
Accumulated Value will also be
transferred to the [money market
Sub-Account];
(c) additional Payments may be made; and
(d) any subsequent spouse of the new
Owner, if named as the Beneficiary,
may not continue the contract.
21
PAYMENT CREDIT RECAPTURE
Prior to the Annuity Date, the Company will
recapture all or part of any Payment Credits
(the "Payment Credit Recapture Amount") in
the circumstances outlined below:
(a) If the Right to Examine contract
provision is exercised and the
amount payable is based on the
Accumulated Value;
(b) If a withdrawal, subject to a
surrender charge, is taken prior to
the first contract anniversary;
(c) If the contract is surrendered prior
to the first contract anniversary;
or
(d) If death of an Owner (or an
Annuitant, if the Owner is a
non-natural person) occurs prior to
the first contract anniversary and
the contract is not continued by the
deceased Owner's spouse (or deceased
Xxxxxxxxx's spouse, if the Owner is
a non-natural person).
In (a), (c) and (d) above, the Payment
Credit Recapture Amount is equal to total
Payment Credits.
In (b) above, the Payment Credit Recapture
Amount is calculated by applying the
applicable percentage in the Payment Credit
Recapture Table (see Specifications page) to
Payments, subject to a surrender charge,
that are withdrawn (see Specifications
page).
The Payment Credit Recapture Amount will
first be considered withdrawn on a first-in,
first-out basis from Payments not previously
withdrawn. The Payment Credit Recapture
Amount will then be considered withdrawn
from Cumulative Earnings.
22
THE PAYOUT PHASE
ANNUITY BENEFIT
Annuity Options Annuity Options are available on a fixed,
variable or combination fixed and variable
basis. The Annuity Options described below
or any alternative option offered by the
Company may be chosen. If no option is
chosen, monthly benefit payments will be
made under the Life Annuity with 10 Years
Period Certain option.
Fixed annuity options are funded through the
General Account. Variable annuity options
may be funded through one or more of the
Sub-Accounts. Not all Sub-Accounts may be
made available.
Selection of Annuity The Owner must select an Annuity Benefit
Benefit Payments Payment Option prior to or after the Issue
Date but before the Annuity Date. Annuity
benefit payments will be paid monthly or at
any other frequency currently offered by the
Company. If the first payment would be less
than the Minimum Annuity Benefit Payment
(see Specifications page), a single payment
will be made instead. If a life annuity
option has been elected, satisfactory proof
of the date of birth of the Annuitant must
be received at the Principal Office before
any payment is made. Also, if a life annuity
option has been elected, from time to time
the Company may require satisfactory proof
that the Annuitant is alive.
Selection or Change The Owner must select an Annuity Date when
of Annuity Date selecting an Annuity Benefit Payment Option.
If a Period Certain payment option is
selected, the Annuity Date must be on or
after the second contract anniversary;
otherwise, the Annuity Date must be at least
30 days after the Issue Date. Prior to such
Annuity Date, the Owner may change the
Annuity Date by Request. The Request must be
received at the Principal Office at least
one month before the new Annuity Date. To
the extent permitted by applicable laws,
rules and regulations governing variable
annuities, the new Annuity Date must be no
later than the Maximum Alternative Annuity
Date shown on the Specifications page.
Annuity Benefit Payment In the case of a variable annuity option,
Change Frequency the Owner must select an Annuity Benefit
Payment Change Frequency. This is the
frequency of change in the dollar value of
the variable annuity benefit payments. For
example, if an annual Annuity Benefit
Payment Change Frequency is chosen, the
dollar value of variable annuity benefit
payments will remain constant within each
one-year period. The Owner must also select
the date of the first change.
Assumed Investment In the case of a variable annuity option,
Return the Owner must select an Assumed Investment
Return ("AIR"). This rate is used to
determine the initial variable annuity
benefit payment and how the payment will
change over time in response to the
performance of the selected Sub-Accounts.
If the actual performance of any selected
Sub-Account (as measured by the Net
Investment Factor) is equal to the AIR, the
annuity benefit payment attributable to
that Sub-Account will be constant. If the
actual performance is greater than the AIR,
the annuity benefit payment will increase.
If the actual performance is less than the
AIR, the annuity benefit payment will
decrease.
Reversal of Decision The Owner may reverse the decision to
To Annuitize annuitize by a Request in writing within
90 days after the Annuity Date. Upon
receipt of such notice, the Company will
place the contract back to the Accumulation
Phase subject to the following:
23
(a) The funds applied under a variable
annuity option during this period
will be treated as if they had been
invested in the Accumulation Phase
of the contract, with the same
allocations that were in effect
since the Annuity Date.
(b) The funds applied under a fixed
annuity option during this period
will be treated as if they had been
invested in the Accumulation Phase
of the contract in the Fixed
Account, since the Annuity Date.
(c) Any annuity benefit payment paid or
withdrawal taken during this period
will be treated as a withdrawal of
the Surrender Value as of the date
of the payment or withdrawal. Fixed
Annuity benefit payments will be
treated as withdrawals from the
Fixed Account. Variable annuity
benefit payments will be treated as
withdrawals from the variable Sub-
Accounts. Surrender charges and
Payment Credit Recapture Amounts may
apply to these withdrawals.
(d) If the Company learns of the Owner's
decision to reverse after the
Maximum Alternative Annuity Date
(see Specifications page) the Owner
must immediately select another
Annuity Benefit Payment Option.
Annuity Value The Annuity Value will be the Accumulated
Value, after application of any applicable
Market Value Adjustment, and less any
applicable premium tax. For a Death
Benefit annuity, the Annuity Value will be
the amount of the Death Benefit, less any
applicable premium tax.
The amount of the first annuity benefit
payment under all available options except
period certain options will depend on the
age and/or sex of the Annuitant on the
Annuity Date and the Annuity Value applied.
Period certain options are based only on the
duration of payments and the Annuity Value.
Annuity Unit Values A Sub-Account Annuity Unit Value on any
Valuation Date is equal to its value on the
preceding Valuation Date multiplied by the
product of:
(a) a discount factor equivalent to the
Assumed Investment Return; and
(b) the Net Investment Factor of the
Sub-Account funding the annuity
benefit payments for the applicable
Valuation Period.
The value of an Annuity Unit as of any date
other than a Valuation Date is equal to its
value as of the preceding Valuation Date.
Each variable annuity benefit payment is
equal to the number of Annuity Units
multiplied by the applicable value of an
Annuity Unit, except that under a Joint and
Survivor Option, after the first death, the
number of units in each payment is equal to
the total number of units multiplied by the
Survivor Annuity Benefit Percentage.
Variable annuity benefit payments will
increase or decrease with the value of the
Annuity Units as of the date of the first
payment of each Annuity Benefit Payment
Change Frequency. The Company guarantees
that the amount of each variable annuity
benefit payment will not be affected by
changes in mortality and expense experience.
24
Number of Annuity Units For each Sub-Account the number of Annuity
Units determining the benefit payable is
equal to the amount of the first annuity
benefit payment divided by the value of the
Annuity Unit as of the Valuation Date used
to calculate the amount of the first
payment. Once annuity benefit payments
begin, the number of Annuity Units will not
change unless a split, a withdrawal or a
transfer is made.
Payment of Annuity Annuity Benefit Payments are paid to the
Benefit Payments Owner. By Request in writing, the Owner may
direct that payments are made to another
person, persons or entity.
If an Owner, who is not also an Annuitant,
dies on or after the Annuity Date, the
following occurs:
(a) If the deceased Owner was the sole
Owner, then the remaining annuity
benefit payments will be payable to
the Beneficiary in accordance with
the terms of the Annuity Option
selected. Upon the death of a sole
Owner, the Beneficiary becomes the
Owner of the contract; or
(b) If the contract has joint Owners,
then the remaining annuity benefit
payments will be payable to the
surviving joint Owner in accordance
\ with the terms of the Annuity Option
selected. Upon the death of the
surviving joint Owner, the
Beneficiary becomes the Owner of the
contract.
TRANSFER
After the Annuity Date and prior to the
death of the Annuitant, the Owner may
transfer among Sub-accounts by Request to
the Principal Office.
Transfers may increase or decrease the
number of Annuity Units in each subsequent
payment.
There is no charge for the first twelve
transfers per contract year. A transfer
charge of up to $25 may be imposed on each
additional transfer.
The Company reserves the right to limit or
refuse transfers if it determines, in its
sole discretion, that the exercise of that
right by an Owner(s), or any agent or duly
authorized representative of such Owner(s)
is, or would be, to the disadvantage of
other Owners. Such transfer limitations
could be applied to transfers to or from
some or all of the accounts and could
include but not be limited to:
(a) the requirement of a minimum time
period between each transfer;
(b) not accepting a transfer request of
an agent or duly authorized
representative of such Owner(s)
authorized to act on behalf of such
Owner(s); and
(c) limiting the dollar amount that may
be transferred to or from any of the
accounts by an Owner(s) at any one
time.
Such limitations, individually or in
aggregate, may be applied in any manner
reasonably designed to prevent any use of
the transfer right which is considered by
the Company to be to the disadvantage of
other Owners.
25
WITHDRAWAL
After the Annuity Date and prior to the
death of the Annuitant, the Owner may have
the right, based on the Annuity Option
selected, to make withdrawals. If the Death
Benefit is applied under an Annuity Option
the Beneficiary may also make withdrawals in
accordance with this provision.
Amounts withdrawn that were applied under a
variable Annuity Option will be paid within
7 days of the date a Request is received.
The Company reserves the right to delay
payments subject to applicable laws, rules
and regulations governing variable
annuities.
Amounts withdrawn that were applied under a
fixed Annuity Option will normally be paid
within 7 days of the date a Request is
received. The Company may defer payment for
up to six months from the date a Request is
received. If deferred for 30 days or more,
the amount payable will be credited interest
at a rate of at least 3% or the appropriate
rate mandated by the State.
Only one Request for withdrawal under each
provision may be made each calendar year,
unless a period certain option is chosen.
Payment Withdrawal Each calendar year, the Owner can request up
Amount Option to an amount equal to the Payment Withdrawal
Amount (see Specifications page).
For fixed Annuity Options, each withdrawal
proportionately reduces the dollar amount of
each future annuity benefit payment. The
proportionate reduction is calculated by
multiplying the dollar amount of each future
annuity benefit payment by the following:
Amount of the withdrawal
------------------------
Present Value of all remaining
fixed annuity benefit payments
immediately prior to the withdrawal.
For variable Annuity Options, each
withdrawal proportionately reduces the
number of Annuity Units in each future
annuity benefit payment. The proportionate
reduction is calculated by multiplying the
number of Annuity Units in each future
annuity benefit payment by the following:
Amount of the withdrawal
------------------------
Present Value of all remaining
variable annuity benefit payments
immediately prior to the withdrawal.
Present Value Over the life of the contract, for period
Withdrawal Option certain and life with period certain
Annuity Options when there are remaining
guaranteed annuity benefit payments, the
Owner may request withdrawals which
represent a percentage of the Present Value
of those remaining guaranteed annuity
benefit payments. "Guaranteed annuity
benefit payments" refers to the non-life
contingent annuity benefit payments. Each
year a withdrawal is taken under this
provision, the Company records the
percentage withdrawn. Each withdrawal
proportionately reduces future annuity
benefit payments. (See proportionate
reduction calculation below.) The total
percentage withdrawn over the life of the
contract cannot exceed the Present Value
Withdrawal Amount (see Specifications page).
For fixed Annuity Options, each withdrawal
proportionately reduces the dollar amount of
each future annuity benefit payment. The
proportionate reduction is
26
calculated by multiplying the dollar amount
of each future annuity benefit payment by
the following:
Amount of the withdrawal
------------------------
Present Value of all remaining fixed
guaranteed annuity benefit payments
immediately prior to the withdrawal
For variable Annuity Options, each
withdrawal proportionately reduces any
remaining guaranteed payments. The
proportionate reduction is calculated by
multiplying the number of Annuity Units in
each future annuity benefit payment by the
following:
Amount of the withdrawal
------------------------
Present Value of all remaining variable
guaranteed annuity benefit payments
immediately prior to the withdrawal
If an Annuitant is still living after there
are no remaining guaranteed payments under a
life with period certain payout:
(a) for variable Annuity Options, the
number of Annuity Units will
increase to the number of Annuity
Units payable prior to any
withdrawals, adjusted for transfers.
(b) for fixed Annuity Options, the
dollar amount of the annuity benefit
payments will increase to the amount
payable prior to any withdrawals,
adjusted for transfers.
PRESENT VALUE OF ANNUITY BENEFIT PAYMENTS
For a variety of purposes, it is at times
necessary to determine the Present Value of
either all future annuity benefit payments
or of future guaranteed annuity benefit
payments. Present Values are calculated
based on the Annuity 2000 Mortality Table,
male, female or unisex rates as appropriate,
and the interest rate or AIR used to
determine the annuity benefit payments
increased by the following adjustments:
Adjustment
Death of the Annuitant 0.00%
All Withdrawals after the Annuity Date:
- 5 or more years after the Issue Date 0.00%
- Within 5 years of the Issue Date:
15 or more years of annuity benefit
payments being valued 1.00% 10-14
years of annuity benefit payments
being valued 1.50% Less than 10
years of annuity benefit payments
being valued 2.00%
Unless otherwise indicated by the Owner,
upon the death of the Annuitant, the Present
Value of the remaining guaranteed annuity
benefit payments may be paid to the Owner.
27
ANNUITY BENEFIT PAYMENT OPTIONS
PERIOD CERTAIN ANNUITY:
Periodic annuity benefit payments for a
chosen number of years. The number of years
selected may be from 10 to 30, or any other
period currently made available by the
Company.
LIFE ANNUITY:
(a) Single Life - Periodic annuity
benefit payments during the
Annuitant's life. The annuity
benefit payments do not continue
after the death of the Annuitant.
(b) Joint and Survivor - Periodic
annuity benefit payments during the
joint lifetime of the Joint
Annuitants. For variable options,
after the first death, the number
of units in each payment during the
lifetime of the survivor is equal to
the total number of units multiplied
by the Survivor Annuity Benefit
Percentage. For fixed options, after
the first death, the dollar amount
of each payment during the lifetime
of the survivor is equal to the
dollar value of each payment paid
prior to such death multiplied by
the Survivor Annuity Benefit
Percentage.
LIFE ANNUITY GUARANTEE OPTIONS
If a life Annuity Option has been elected,
the Owner may also select one of the
following guarantees:
PERIOD CERTAIN
Periodic guaranteed payments for a period of
5 to 30 years, or any other period currently
made available by the Company.
CASH BACK
Upon notification of the Annuitant's death,
any excess of the Annuity Value applied over
the total amount of the annuity benefit
payments will be paid to the Owner or
Beneficiary, whichever is applicable.
ANNUITY OPTION RATE TABLES
The first variable annuity benefit payment
will be based on the Annuity Option Rates
made available by the Company on the rate
basis available at the time the Annuity
Option is selected. The fixed annuity
benefit payments will be based on the
greater of the guaranteed Annuity Option
Rates shown in the tables on the following
pages or the Company's non-guaranteed
current Annuity Option Rates applicable to
this class of contracts. The Company
guarantees that once an Annuity Option is
selected, the annuity benefit payments will
not be affected by changes in mortality and
expense experience.
28
GUARANTEED ANNUITY OPTION TABLES FOR FIXED ANNUITY OPTIONS
FIRST MONTHLY ANNUITY BENEFIT PAYMENT
FOR EACH $1,000 OF ANNUITY VALUE APPLIED
Age
Nearest Life Annuity with Life Life Annuity
Payment 10 Year Period Certain Annuity With Cash Back
Male Female Unisex Male Female Unisex Male Female Unisex
[50 4.05 3.81 3.91 4.08 3.83 3.93 3.90 3.72 3.79
51 4.11 3.87 3.97 4.15 3.89 3.99 3.96 3.77 3.85
52 4.18 3.93 4.03 4.22 3.95 4.06 4.01 3.82 3.90
53 4.25 3.99 4.10 4.30 4.01 4.13 4.07 3.88 3.96
54 4.33 4.06 4.17 4.38 4.08 4.20 4.14 3.94 4.02
55 4.41 4.13 4.24 4.46 4.15 4.28 4.20 3.99 4.07
56 4.49 4.20 4.32 4.55 4.23 4.36 4.27 4.06 4.14
57 4.58 4.28 4.40 4.65 4.31 4.45 4.34 4.12 4.21
58 4.68 4.36 4.49 4.75 4.40 4.54 4.42 4.19 4.28
59 4.78 4.45 4.58 4.86 4.49 4.64 4.50 4.26 4.36
60 4.88 4.54 4.67 4.98 4.59 4.74 4.58 4.34 4.44
61 4.99 4.63 4.77 5.10 4.69 4.85 4.67 4.42 4.52
62 5.10 4.73 4.88 5.23 4.80 4.97 4.76 4.50 4.60
63 5.23 4.84 4.99 5.37 4.92 5.10 4.85 4.59 4.69
64 5.35 4.95 5.11 5.52 5.04 5.24 4.95 4.68 4.79
65 5.48 5.07 5.24 5.69 5.18 5.38 5.06 4.78 4.89
66 5.62 5.20 5.37 5.86 5.32 5.54 5.17 4.89 5.00
67 5.77 5.33 5.51 6.04 5.47 5.70 5.28 4.99 5.11
68 5.92 5.47 5.65 6.24 5.64 5.88 5.40 5.11 5.23
69 6.07 5.62 5.80 6.45 5.82 6.07 5.52 5.23 5.35
70 6.23 5.78 5.96 6.67 6.01 6.27 5.66 5.36 5.48
71 6.39 5.94 6.12 6.90 6.21 6.49 5.79 5.49 5.61
72 6.56 6.11 6.29 7.16 6.44 6.72 5.94 5.63 5.75
73 6.73 6.29 6.47 7.43 6.68 6.98 6.09 5.78 5.90
74 6.90 6.48 6.65 7.71 6.94 7.25 6.24 5.94 6.06
75 7.08 6.67 6.83 8.02 7.22 7.54 6.41 6.11 6.23]
These tables are based on an annual interest rate of [3%]
and the Annuity 2000 Mortality Table
29
GUARANTEED ANNUITY OPTION TABLES FOR FIXED ANNUITY OPTIONS (CONTINUED)
FIRST MONTHLY ANNUITY BENEFIT PAYMENT
FOR EACH $1,000 OF ANNUITY VALUE APPLIED
Joint and Survivor Life Annuity
Older Age
50 55 60 65 70 75 80
Y 50 [3.53 3.61 3.68 3.73 3.76 3.79 3.80
O 55 3.77 3.88 3.97 4.04 4.08 4.11
U 60 4.10 4.25 4.36 4.45 4.50
N 65 4.55 4.74 4.90 5.01
G 70 5.16 5.43 5.64
E 75 6.02 6.41
R 80 7.25]
A
G
E
Joint and Two-Thirds Survivor Life Annuity
Older Age
50 55 60 65 70 75 80
Y 50 [3.80 3.93 4.09 4.25 4.43 4.61 4.80
O 55 4.11 4.29 4.49 4.70 4.91 5.13
U 60 4.53 4.77 5.02 5.29 5.55
N 65 5.09 5.42 5.75 6.07
G 70 5.88 6.31 6.75
E 75 6.99 7.59
R 80 8.58]
A
G
E
These tables are based on an annual interest rate of [3 %]
and the Annuity 2000 Mortality Table
30
GUARANTEED ANNUITY OPTION TABLES FOR FIXED ANNUITY OPTIONS (CONTINUED)
FIRST MONTHLY ANNUITY BENEFIT PAYMENT
FOR EACH $1,000 OF ANNUITY VALUE APPLIED
Number of Xxxxx Xxxxxxx for a
Years Period Certain
[ 10 9.61
15 6.87
20 5.51
25 4.71
30 4.18]
These tables are based on an annual interest rate of [3%]
and the Annuity 2000 Mortality Table.
31
GENERAL PROVISIONS
Entire Contract The entire contract consists of this
contract, any application attached at issue,
riders, Specifications pages and
endorsements.
Misstatement of Age If the age or sex of an individual is
or Sex misstated, the Company will adjust all
benefits payable to that which would be
available at the correct age or sex. Any
underpayments already made by the Company
will be paid immediately. Any overpayments
will be deducted from future annuity benefit
payments.
Failure to Notify Company After the Annuity Date and once notified of
of Annuitant Death the Annuitant's death, the Company reserves
the right to recover any overpaid annuity
benefit payments.
Modifications Only the President or Vice President of the
Company may modify or waive any provisions
of this contract. Agents or Brokers are not
authorized to do so.
Incontestability The Company cannot challenge the validity of
this contract after it has been in force for
more than two years from the date of issue.
Minimums All values and benefits available under this
contract equal or exceed those required by
the State in which the contract is
delivered.
Annual Report The Company will furnish an annual report to
the Owner containing a statement of the
number and value of Accumulation Units
credited to the Sub-Accounts, the value of
the Fixed Account and the Guarantee Period
Accounts and any other information required
by applicable law, rules and regulations.
Addition, Deletion, or The Company reserves the right, subject to
Substitution of compliance with applicable law, to add to,
Investments delete from, or substitute for the shares of
a Fund that are held by the Sub-Accounts or
that the Sub-Accounts may purchase. The
Company also reserves the right to eliminate
the shares of any Fund no longer available
for investment or if the Company believes
further investment in the Fund is no longer
appropriate for the purposes of the
Sub-Accounts.
The Company will not substitute shares
attributable to any interest in a
Sub-Account without notice to the Owner and
prior approval of the Securities and
Exchange Commission as required by the
Investment Company Act of 1940. This will
not prevent the Variable Account from
purchasing other securities for other series
or classes of contracts, or from permitting
a conversion between series or classes of
contracts on the basis of requests made by
Owners.
The Company reserves the right, subject to
compliance with applicable laws, to
establish additional Separate Accounts,
Guarantee Period Accounts and Sub-Accounts
and to make them available to any class or
series of contracts as the Company considers
appropriate. Each new Separate Account or
Sub-Account will invest in a new investment
company, or in shares of another open-end
investment company, or such other
investments as may be permitted under
applicable law. The Company also reserves
the right to eliminate or combine existing
Sub-Accounts and to transfer the assets of
any Sub-Accounts to any other Sub-Accounts.
In the event of any substitution or change,
the Company may, by appropriate notice, make
such changes in this and other contracts as
may be necessary or appropriate to reflect
the substitution or change. If the Company
considers it to be in the best interests of
the owners, the Variable Account or any
Sub-Account may be operated as a management
company under
32
the Investment Company Act of 1940 or in any
other form permitted by law, or may be
de-registered under the Act in the event
registration is no longer required, or may
be combined with other accounts of the
Company.
Changes in Law The Company reserves the right to make any
changes to provisions of the contract to
comply with, or give Owners the benefit of,
any federal or State statute, rule, or
regulation.
Change of Name Subject to compliance with applicable law,
the Company reserves the right to change the
names of the Variable Account or the
Sub-Accounts.
Federal Tax The Variable Account is not currently
Considerations subject to tax, but the Company reserves the
right to assess a charge for taxes if the
Variable Account becomes subject to tax.
Splitting of Units The Company reserves the right to split the
value of a unit, either to increase or
decrease the number of units. Any splitting
of units will have no material effect on the
benefits, provisions or investment return of
this contract or upon the Owner, the
Annuitant, any Beneficiary, or the Company.
Insulation of Separate The investment performance of Separate
Account Account assets is determined separately
from the other assets of the Company. The
assets of a Separate Account equal to the
reserves and liabilities of the contracts
supported by the account will not be charged
with liabilities from any other business
that the Company may conduct.
33
Flexible Payment Deferred Variable and Fixed Annuity
Annuity Benefit Payments Payable on the Annuity Date
Death Benefit Payable to Beneficiary if Owner Dies prior to Annuity Date
Non-Participating
Form A3038-02 34 bascb2-10
