EXHIBIT NO. 5
FLEXIBLE PREMIUM VARIABLE LIFE INSURANCE POLICY
INSURED: [XXXX XXX]
PAYMENT CLASS: [STANDARD NON-SMOKER]
POLICY NUMBER: [SPECIMEN] ISSUE AGE: [35]
FACT AMOUNT: [$100,000] ISSUE DATE: [08/01/1993]
THIS IS A LEGAL CONTRACT -- READ IT CAREFULLY
XXXXXXX BENEFIT LIFE COMPANY promises to pay the death benefit to the
beneficiary on death of the insured upon receipt of the due proof of death of
the insured.
PLEASE EXAMINE THE APPLICATION. We issued this contract based upon the answers
in the application (copy included). If all answers are not complete and true,
the contract may be affected.
RIGHT TO CANCEL YOUR POLICY. You may cancel this contract by returning it to
Lincoln Benefit Life Company, PO Box 82532, Lincoln, NE 68501-2532, before
midnight of the 10th day after the date you receive the policy. Return of the
contract by mail is effective on being postmarked, properly addressed and
postage prepaid. We will refund the net policy value as of the date of
surrender, plus any charges and monthly deductions previously made. READ YOUR
CONTRACT CAREFULLY.
Executed for the Company at its home office in Lincoln, Nebraska on its issue
date.
/s/ Xxxx X. Xxxxxx /s/ Xxxx X. Xxxxxx
Vice President and Secretary President
LINCOLN BENEFIT LIFE COMPANY
Lincoln Benefit Life Centre
Lincoln, NE 68501
A Legal Reserve Stock Life Insurance Company
FLEXIBLE PREMIUM VARIABLE LIFE POLICY
Minimum Premium Required in the First Year
Death Benefit Payable on the Insured's Death
Flexible Premiums Payable for Life
Amount of Death Benefit or Surrender Value may vary,
reflecting investment experience of the Separate Account
Nonparticipating
Page 1
SUMMARY OF POLICY
This policy insures the life of the insured. If the insured dies while this
policy is in force, the death benefit will be paid to the beneficiary.
Payments for this policy are flexible. They may be made during the lifetime of
the insured.
During the lifetime of the insured, you may:
...change the planned payments and time between payments;
...obtain policy loans;
...change the beneficiary;
...change the death benefit option;
...surrender the policy for its net surrender value;
...exercise the other rights provided.
This is only a summary of the policy terms. The detailed provisions of this
policy will control. The provisions of your policy are set forth in the
following sections.
Policy Data.................Page 3 Policy Value......................Page 10
Definitions.................Page 6 Surrender Value...................Page 11
Death Benefit...............Page 7 Loans.............................Page 12
Beneficiary.................Page 8 Other Terms of Your Policy........Page 13
Ownership...................Page 9 Application.......................Insert
Premium Payment.............Page 9 Benefit Riders (if any)...........Insert
READ YOUR POLICY CAREFULLY
VUL 9390 Page 2
[POLICY DATA]
INSURED: [XXXX XXX]
PAYMENT CLASS: [STANDARD NON-SMOKER]
POLICY NUMBER: [SPECIMEN] ISSUE AGE: [35]
FACE AMOUNT: [$100,000] ISSUE DATE: [08/01/1993]
MONTHLY DEDUCTION DAY 01
B E N E F I T D E S C R I P T I O N
YEAR OF EXPIRY
OR MATURITY
FLEXIBLE PREMIUM VARIABLE LIFE LIFE
INSURANCE - [DEATH BENEFIT OPTION 1]
PAYMENT INFORMATION
REQUIRED PAYMENT [786]
PLANNED ANNUAL PAYMENT [786]
INITIAL PAYMENT [786]
THE PAYMENT OF A [MONTHLY SAFETY NET/LIFETIME GUARANTEE]
PREMIUM OF [$65.50] IS GUARANTEED TO KEEP THIS POLICY IN FORCE
FOR [30] YEARS, ASSUMING NO LOANS OR WITHDRAWALS ARE TAKEN.
SEE [SAFETY NET/LIFETIME GUARANTEE] PREMIUM PROVISION ON PAGE 10 FOR
DETAILS.
SEPARATE ACCOUNT: XXXXXXX BENEFIT LIFE VARIABLE LIFE ACCOUNT
SUBACCOUNT ALLOCATION %
---------- ------------
[JANUS WORLDWIDE SUBACCOUNT] [20]
[FIDELITY VIPFII ASSET MANAGER SUBACCOUNT] [80]
VUL 9390 Page 3
SURRENDER CHARGE SCHEDULE
SURRENDER CHARGES FOR INITIAL FACE AMOUNT
THE FOLLOWING REPRESENTS THE MAXIMUM SURRENDER CHARGES WHICH MAY BE
ASSESSED AGAINST YOUR POLICY, ASSUMING NO ELECTIVE INCREASES IN FACE
AMOUNT.
POLICY AMOUNT OF POLICY AMOUNT OF
YEAR CHARGE YEAR CHARGE
------ --------- ------ ---------
1 $[632] 9 $[442]
2 [632] 10 [316]
3 [632] 11 [253]
4 [632] 12 [126]
5 [632] 13 on [-0-]
6 [600]
7 [569]
8 [506]
TABLE TO CALCULATE SURRENDER CHARGES
FOR ELECTIVE INCREASES IN FACE AMOUNT
Increase Per $1000 Increase Per $1000
Age of Increase Age of Increase
------ ----------- -------- -----------
0-25 1.45 35 3.08
26 1.60 36 3.27
27 1.75 37 3.46
28 1.90 38 3.65
29 2.05 39 3.85
30 2.20 40 4.04
31 2.35 41 4.23
32 2.50 42 4.42
33 2.69 43 4.62
34 2.88 44 4.81
45 and above 5.00
SURRENDER PERCENTAGES
INCREASE YEAR
1 2 3 4 5 6 7 8 9 10 11 12 13 on
- - - - - - - - - -- -- -- -----
% 100 100 100 100 100 95 90 80 70 50 40 20 -0-
VUL 9390 Page 4
GUARANTEED MONTHLY COST OF INSURANCE
POLICY RATE POLICY RATE
YEAR PER $1,000 YEAR PER $1,000
------ ---------- ------ ----------
1 0.14 34 2.49
2 0.15 35 2.74
3 0.16 36 3.03
4 0.17 37 3.36
5 0.18 38 3.74
6 0.19 39 4.17
7 0.21 40 4.64
8 0.22 41 5.15
9 0.24 42 5.68
10 0.26 43 6.24
11 0.28 44 6.82
12 0.31 45 7.46
13 0.33 46 8.15
14 0.36 47 8.93
15 0.39 48 9.81
16 0.42 49 10.79
17 0.46 50 11.84
18 0.51 51 12.95
19 0.56 52 14.09
20 0.62 53 15.26
21 0.68 54 16.44
22 0.75 55 17.65
23 0.82 56 18.92
24 0.91 57 20.26
25 1.00 58 21.73
26 1.10 59 23.47
27 1.22 60 25.81
28 1.35 61 29.32
29 1.50 62 35.08
30 1.67 63 45.08
31 1.85 64 62.09
32 2.05
33 2.26
VUL 9390 Page 5
Definitions
When these words are used in this contract, they have the meaning stated:
"app"
The application which you completed requesting this policy.
"beneficiary(ies)"
The person(s) designated to receive any death benefit under the policy.
"benefit rider"
An addition benefit we are providing
"Company ("we", "us", "our", "Lincoln Benefit Life")"
Our company, Lincoln benefit Life Company.
"death benefit"
the amount payable to the beneficiary under the policy upon the death of the
insured.
"face amount"
The initial death benefit, shown on page 3, adjusted for any increases or
decreases made after the issue date.
"fund"
A series mutual fund.
"increase age"
The age of the insured as of the effective date of an increase in base amount,
determined by the insured's last birthday.
"increase year"
A twelve month period beginning on an anniversary of the effective date of an
increase in base amount.
"insured"
The person upon whose life is covered by this policy.
"issue age"
The age of the insured at the time this policy issued (issue date) determined by
the insured's last birthday.
"issue date"
The date the policy is issued, as shown on Page 3. It is used to determine
policy years and policy months in the policy.
"lapse determination value"
The value that must be available to pay a monthly deduction in order for the
policy to remain in force. This is the policy value if no loans are on the
policy; and the net surrender value if the policy has outstanding loans.
"monthly-automatic payment"
A method of making payments each month automatically; for example, by bank draft
or salary deduction.
"monthly deduction day"
The same day in each month as the issue date. The day of the month on which
deductions are made. This day is shown on page 3.
"net death benefit"
The death benefit less any policy debt.
"net investment factor"
An index applied to measure the net investment performance of a subaccount from
one valuation date to the next. It is used to determine the policy value of a
subaccount in any valuation period.
"net policy value"
the policy value less any policy debt.
"net premium"
The gross premium less the premium charge.
"net surrender value"
The amount you would receive upon surrender of this contract, equal to the
surrender value less any policy debt.
VUL 9390 Page 6
"policy data"
The pages of this policy which identify specific information about the insured
and the benefits.
"policy debt"
The sum of all unpaid policy loans and accrued interest thereon.
"policy month"
A one month period beginning on the same day of the month as the issue date of
the policy.
"policy value"
the sum of the values of your interests in the subaccounts of the separate
account plus the value held in our general account as security for outstanding
policy loans. The amount from which monthly deductions are made and the death
benefit is determined.
"policy year"
A twelve month period beginning on an anniversary of the issue date.
"portfolio(s)"
the underlying mutual fund(s) (or investment securities thereof) in which the
subaccounts invest.
"premium class"
The class into which the insured is placed, determined by our rules for
providing insurance coverage.
"proof of death"
(1) a certified original copy of the death certificate; or (2) a certified copy
of a decree of a court of competent jurisdiction as to the finding of death; or
(3) a written statement by a medical doctor who attended the deceased at the
time of death; or (4) any other proof satisfactory to the company.
"record date"
The date we record the policy on our books as an inforce policy.
"required payment"
The minimum premium which must be paid to keep the policy in force for the first
year.
"separate account"
A segregated investment account of the Company entitled Lincoln Benefit Life
Variable Life Account.
"subaccount"
A subdivision of the separate account invested wholly in shares of one of the
portfolios.
"surrender value"
the policy value less any applicable surrender charges.
"valuation date"
Each day the New York Stock Exchange ("NYSE") is open for business.
"valuation period"
The period commencing at the close of normal trading on the NYSE (currently 4:00
p.m. Eastern time) on each valuation date and ending at the close of the NYSE on
the next succeeding value date.
"you"
The person(s) having the privileges of ownership defined in the policy. Such
privileges may be restricted by a retirement plan pursuant to which the policy
is issued.
DEATH BENEFIT
If the insured dies while this policy is in force, we will pay the death benefit
when we have received due proof of death. The death benefit will be based on:
1. The death benefit option in effect on the date of death;
2. Any increases or decreases to the face amount.
The death benefit will be reduced by any outstanding policy loans and accrued
loan interest. We will pay interest on the net death benefit from the date of
death until the date we pay it. The rate will be determined by us, but not less
than the rate required by the state in which the policy was issued.
VUL 9390 Page 7
death benefit option
While the insured is alive you may choose between two death benefit options:
If you select Option 1, the death benefit will be the greater of:
a. The face amount on the date of death; or
b. The percentage of the policy value shown in the Compliance with Federal Laws
Provision.
If you select Option 2, the death benefit will be the greater of:
a. The base amount plus the policy value on the date of death; or
b. The percentage of the policy value shown in the Compliance with Federal Laws
Provision.
The initial death benefit option selected by you is stated in the app.
change of death benefit option
You may ask us to change the death benefit option by writing to us. If you ask
to change from Option 2 to Option 1, the face amount will be increased by the
amount of the policy value. If you ask to change from Option 1 to Option 2, the
face amount will be decreased by the amount of the policy value.
The change will take effect on the monthly deduction day on or following the
date we receive the written request.
change of face amount
At any time after the fifth policy year, you may request either of the following
changes by writing us:
1. Increasing the face amount. You must submit a new app for an increase in
face amount. We will require due proof that the insured is still insurable.
An increase will be effective on the monthly deduction day after we approve
the increase. We reserve the right to limit the amount of any increases made
under this policy. The face amount may not be increased more than once in
any 12 month period.
2. Decreasing the face amount. A decrease will take effect on the monthly
deduction day on or following the date we received the request. A decrease
in face amount will first be applied against the most recent increase, then
to the next most recent increase successively, and finally to the initial
face amount. The face amount in effect after any decrease may not be less
than $25,000.
BENEFICIARY
The beneficiary will receive the death benefit when the insured dies and we have
received due proof of death. The beneficiary is as stated in the app unless
changed.
The beneficiary will receive the death benefits in the following order:
...Primary beneficiary, who will receive the death benefit if living when the
insured dies.
...Contingent beneficiary, who will receive the death benefit if the primary
beneficiary dies before the insured.
If a beneficiary dies at the same time as the insured or within fifteen days
thereafter, we will pay the death benefit as if that beneficiary were not living
when the insured died. If none of the named beneficiaries are living when the
insured dies, the death benefit will be paid to you.
We will pay the death benefit to the beneficiaries according to the most recent
written instruction we have received from you. If we do not have any written
instructions, we will pay the death benefit in equal shares to the beneficiaries
who are to share the funds. If there is more than one beneficiary in a class
and one of the beneficiaries predeceases you, the death benefit will be paid to
the surviving beneficiaries in that class.
You may name new beneficiaries. We will provide a form to be signed. You must
file it with us. Upon receipt, it is effective as of the date you signed the
form, subject to any action we have taken before we received it.
If you name one or more irrevocable beneficiaries, no change in the
beneficiaries and no changes which affect policy values may be made without
their consent. No beneficiary has any rights in this policy until the insured
dies.
VUL 9390 Page 8
OWNERSHIP
The insured is the owner if no other person is named in the app as owner. The
owner controls the policy during the lifetime of the insured. Unless you provide
otherwise, as owner, you may exercise all rights granted by the policy without
the consent of anyone else. If the named owner dies before the insured, then the
contingent owner named in the app is the new owner. If no owner named in this
policy is living, then the owner will be the estate of the last named owner.
You may name a new owner. We will provide a form to be signed. You must file it
with us. Upon receipt, it is effective as of the date you signed the form,
subject to any action we have taken before we received it.
You may assign this policy or an interest in it to another. You must do so in
writing and file the assignment with us. No assignment is binding on us until we
receive it. When we receive it your rights and those of the beneficiary will be
subject to the assignment.
We are not responsible for the validity of any assignment you make.
PREMIUM PAYMENT
payments
Premiums for this policy are referred to as payments. The planned payment,
required payment and the time between payments are shown on Page 3.
Payments are flexible. This means you may change the amount of planned payments
and the time between payments. During the first year, you must pay an amount at
least as great as the required payment.
We must have received the first payment on the issue date. There is no insurance
until the first payment is made.
We will send you a reminder notice if you pay annually, semi-annually or
quarterly. You may also make a monthly-automatic payment. We may establish
limits on both the amount of payment and the time between payments.
Payments must be sent to our home office. The amount you pay will affect the
policy value. If you pay too little, the policy will stop subject to the grace
period.
allocation of premium payments
We will invest the net premium payments in the subaccounts you select. You must
specify your allocations on the app, in whole percents from 0% to 100%. The
total allocation must equal 100%. All net premium payments received before the
record date will be credited to the Money Market portfolio as of the date we
receive them. We will allocate such net premiums, plus earnings and less monthly
deductions, on the record date to the subaccounts you have selected. You may
change the allocation percentages at any time by writing us. Any change will be
effective when we receive it.
grace period
Except as provided in the monthly guarantee premium provison below, if on any
monthly deduction day the lapse determination value is determined to be less
than the monthly deduction for the current policy month, you will be given a
grace period of 61 days. This policy will be in force during the grace period.
If you do not make sufficient payment by the end of the grace period, the policy
will stop. If the insured dies during the grace period, we will deduct any
monthly deductions from the amounts we pay.
We will send a written notice to the most recent address we have for you at
least 30 days prior to the day coverage stops.
monthly guarantee premiums
In order to provide assurance that coverage will remain in force for specified
periods, the Policy offers a Guaranteed Minimum Death Benefit ("GMDB") feature
with two levels of monthly guarantee premiums--the lifetime guarantee premium
and the safety net premium.
lifetime guarantee premium
If total payments, less partial withdrawals and policy debt, are greater than or
equal to the sum of the monthly lifetime guarantee premium times the number of
months elapsed since the issue date, then the policy is guaranteed to stay in
force for the
VUL 9390 Page 9
insured's lifetime, even if the lapse determination value becomes insufficient
to cover monthly deductions.
safety net premium
If total payments, less partial withdrawals and policy debt, are greater than or
equal to the sum of the monthly safety net premium times the number of months
elapsed since the issue date, then the policy is guaranteed to stay in force for
a predetermined time period as shown on Page 3, even if the lapse determination
value becomes insufficient to cover monthly deductions. The safety net premium
is equal to the required payment for the first policy year.
The specific monthly guarantee premium option must be selected at issue. If, at
any time the total payments, less partial withdrawals and policy debt, is less
than the sum of the appropriate monthly guarantee premium times the number of
months elapsed, we will let you know and you will be given 61 days to satisfy
any shortfall. If such payments are not made during this period, the GMDB will
expire; once it has expired, it cannot be reinstated. After the GMDB has
expired, the policy will continue in force only so long as its lapse
determination value is sufficient to pay the monthly deductions.
Increases, decreases, partial withdrawals, death benefit option changes, and
additions or deletions of benefit riders, may affect the monthly guarantee
premiums.
reinstatement
If this policy stops, you may ask us to reinstate it--that is, put the policy
back in full force--up to 5 years after the date that it stopped.
We will reinstate the policy if you:
1. Give us the proof we require that the insured is still insurable in the
same payment class that the policy was issued;
2. Pay an amount large enough to cover the monthly deductions for the time, up
to 6 months, since the policy value became zero;
3. Make a payment sufficient to keep the policy in force for 3 policy months;
and
4. Pay or ask us to reinstate any loan with interest as described in the loan
interest provision.
POLICY VALUE
On the issue date or, if later, the date the first premium is received, the
policy value is the net premium less the monthly deduction for the first policy
month.
On any other day, the policy value is the sum of the values in each subaccount,
plus the value of the loan account.
On each valuation date, the policy value in a subaccount is:
1. The policy value of the subaccount on the preceding valuation date,
multiplied by the net investment factor for the subaccount for the current
valuation period, plus
2. Any net premium received and allocated to the subaccount during the current
valuation period, plus
3. Any policy value transferred to the subaccount during the current valuation
period, minus
4. Any policy value transferred from the subaccount during the current
valuation period, minus
5. Any partial withdrawals from the subaccount during the current valuation
period, minus
6. The portion of any monthly deduction or administrative expense charge
allocated to the subaccount during the current valuation period for the
policy month following the monthly deduction day.
All policy values equal or exceed those required by law. Detailed explanations
of methods of calculation are on file with appropriate regulatory authorities.
VUL 9390 Page 10
net investment factor
The net investment factor measures investment performance of a subaccount
during a valuation period. The net investment factor is (1) divided by (2),
minus (3) where:
1. is the result of:
a. the net asset value per share of the portfolio held in the subaccount at
the end of the current valuation period, plus
b. the per share amount of any dividend or capital gain distribution made
by the portfolio during the current valuation period, plus or minus
c. a per share credit or charge with respect to any taxes which we paid or
for which we reserved during the valuation period which are determined
by us to be attributable to the operation of the subaccount (no federal
income taxes are applicable under present law).
2. is the net asset value per share of the portfolio held in the subaccount at
the end of the last prior valuation period.
3. the risk charge assessed for mortality and expense risks, as described on
page 11.
premium charge
Upon receipt of each payment and before allocation of the payment to the
subaccounts, we will deduct a premium charge of 2.5% of the premium.
monthly deductions
The monthly deduction is the sum of:
1. A $5.00 policy fee;
2. The cost of insurance for the policy; and
3. The cost of any benefit riders attached to the policy.
administrative expense charge
An annual administrative expense charge of .20% of policy value will be assessed
on each policy anniversary during the first twelve policy years.
risk charge
We will assess, on a daily basis, an annualized charge which is currently .70%
(guaranteed not to exceed .90%) of the value in each subaccount for our
assumption of certain mortality and expense risks.
Specifically, we bear the risk that the total amount of death benefits payable
will be greater than anticipated, and we also assume the risk that the actual
cost we incur to administer the policy will not be covered by administrative
charges assessed.
cost of insurance
The cost of insurance is determined as follows:
1. Divide the death benefit as of the prior monthly deduction day by
1.003273739.
2. Subtract the policy value as of that prior monthly deduction day less the
policy fee and less the cost of insurance of any benefit riders attached to
this policy;
3. Multiply the results by the current cost of insurance rate divided by
1,000. The cost of insurance rate is based on the insured's sex, issue age,
policy year, and payment class. The rates will be determined by us, but
they will never be more than the guaranteed rates shown on Page 5.
transfers and transfer fee
You may transfer amounts between subaccounts. We reserve the right to impose a
$25 transfer fee on the second and subsequent transfers within a calendar month,
and to impose a minimum size on transfer amounts.
SURRENDER VALUE
The surrender value of this policy is not less than the minimum value required
by the state in which the policy is delivered, calculated in accordance with the
basis of values provision. The surrender value at all times reflects the
payments which you have made and the time elapsed in the policy year.
The surrender value of this policy is the policy value less the surrender
charge. If the surrender charge is greater than the policy value, the surrender
value is zero. The net surrender value is the amount we will pay you if you ask
us to stop this policy.
VUL 9390 Page 11
surrender charge
The maximum surrender charges we will assess, based on the face amount at issue,
are shown in the Surrender Charge Schedule on Page 4. An additional layer of
surrender charge will apply to an elective increase in face amount. The new
layer of surrender charge will be positive for twelve years from the effective
date of the increase. The initial surrender charge on an increase is an amount
per thousand of increase which varies by increase age, as shown in the Table on
Page 4. The charge for any increase year can be calculation from the Table on
Page 4 as follows: [Amount per $1000 of increase] times [increase amount divided
by 1000] times Surrender Percentage.
continuation of coverage
If you stop making payments, this policy and any riders will remain in effect as
long as the lapse determination value covers the monthly deductions or the
policy is still in force as defined in the monthly guarantee premiums provision.
This provision does not continue any riders beyond their normal termination
dates.
partial withdrawal
You may request a partial withdrawal of your net surrender value. We will reduce
both the policy value and the death benefit by the amount of any partial
withdrawal. During the first twelve policy years, a proportionate percentage of
the surrender charge will be deducted from the amount of the partial withdrawal.
The proportionate percentage will be determined by dividing the amount of the
partial withdrawal requested by the cash surrender value. When a partial
withdrawal charge is assessed we will reduce any remaining surrender charges in
a proportionate manner. A partial withdrawal must be for at least $250 and may
not reduce the surrender value below $500.
basis of values
Minimum surrender values are based on the 1980 CSO Mortality Table, age last
birthday, male or female, smoker or nonsmoker, as appropriate. The minimums are
not less than those required by the state in which this policy is delivered.
LOANS
You may have a loan if you assign this contract to us as sole security. The
total amount of your loan and loan interest may not exceed 90% of the surrender
value.
We will ordinarily disburse proceeds of policy loans within seven days from the
date of receipt of a request for a loan at our home office, although payments
may be postponed under certain circumstances as detailed in the "deferment of
payments" section on page 15. As long as the policy remains in force, the loan
may be repaid in whole or in part without penalty at any time while the Insured
is living.
loan interest
An amount equal to your policy value less all premiums paid may be taken as a
preferred loan. The interest are charged for preferred loans is 4% per year. A
standard loan is the amount that may be borrowed from the sum of premiums paid.
The standard loan interest rate is 6% per year.
Interest on policy loans accrues daily and is due at the end of each policy
year. Any interest not paid when due becomes part of the policy loan and
will bear interest at the same rate.
When a policy loan is made a portion of the policy value sufficient to secure
the loan will be transferred to the general account reducing the policy value in
the separate account. Any loan interest that is due and unpaid will also be so
transferred. Amounts transferred to the general account will accrue interest at
an annual rate of 4%. You may allocate a policy loan among the subaccounts of
the separate account. If no such allocation is made, the loan will be allocated
among the subaccounts of the separate account in the same proportion that the
policy value in each subaccount bears to the total policy value on the date of
the loan. Xxxxxxx transferred to our general account will no longer be affected
by the investment experience of the separate account.
loan repayment
You may pay back your loan and loan interest at any time. If you do not, we will
deduct the loan and loan interest from the amounts we pay.
If your loan and loan interest exceed the surrender value, this contract will
stop except as provided in the grace period section. We must mail a notice to
you and all assignees at least 30 days before the contract stops.
VUL 9390 Page 12
OTHER TERMS OF YOUR POLICY
our contract with you
These pages and the signed app are your entire contract with us. We issued it
based upon your app and the payment made by you. A copy of the app is included.
We will not use any statements, except those made in the app, to challenge any
claim or to avoid any liability under this policy. The statements made in the
app will be treated as representations and not as warranties.
Only our officers have authority to change this contract. Any change must be
written. No agent may do this.
when protection starts
The issue date is the date when this policy becomes effective if the insured is
then living and the first payment has been made.
incorrect age or sex
If the insured's age or sex shown on the app is wrong, we will change the
amounts we pay to the amounts which the deductions made would have bought at the
correct age and sex.
incontestability
Except as provided in the next provision or in any attached rider with an
incontestability provision, we may not contest this contract once it has been in
force while the insured is alive for 2 years from its issue date except for
failure to make payments that cause the lapse determination value to be too
small to cover the monthly deductions required to keep this contract and its
riders in force.
We may not contest any increase in face amount once it has been in force while
the insured is alive for 2 years from the effective date of the increase.
suicide or self-destruction
If the insured dies by suicide while sane or self destruction while insane
within 2 years from the issue date of the contract:
1. We will only pay a refund of the payments made less any loan, loan interest
and partial surrenders; and
2. The policy will stop.
annual report
Each year we will send you an annual report following the policy anniversary.
Each report will provide information on various transactions that took place
during the policy year just completed, as well as information on the current
status of the policy. This information will include items such as:
1. The policy value as of the end of the current and prior year.
2. Payments made during the year.
3. The deductions for cost of insurance, riders and expense charges made during
the year.
4. Earnings during the year.
5. The current death benefit.
6. The current surrender charges and surrender value.
7. The amount of outstanding policy loans.
8. Such additional information as required by applicable law or regulation.
nonparticipating
This policy is nonparticipating. It does not share in our profits or surplus
earnings. We will pay no dividends on this policy.
Compliance with federal laws
The two requirements below are intended to maintain the status of this policy
as life insurance under the current Internal Revenue Code:
First, the amount of payments that you may pay is limited by law. We will
conduct a test no less frequently than annually, and return any excess payments.
Second, the death benefit payable may not be less than the applicable percentage
of your policy value. This percentage is based on the attained age as shown in
the table below:
---------------------------------------------
Attained Applicable
Age Percentage
---------------------------------------------
0 to 40 250
41 243
42 236
43 229
44 222
45 215
46 209
VUL 9390 Page 13
---------------------------------------------
Attained Applicable
Age Percentage
---------------------------------------------
47 203
48 197
49 191
50 185
51 178
52 171
53 164
54 157
55 150
56 146
57 142
58 138
59 134
60 130
61 128
63 124
64 122
65 120
66 119
67 118
68 117
69 116
70 115
71 113
72 111
73 109
74 107
75 to 90 105
91 104
92 103
93 102
94 101
95 and above 100
We will conduct a test monthly and increase the death benefit subject to our
then current underwriting limits to be equal to the applicable percentage of
your policy value, if necessary. The death benefit will remain at that level
unless it has to be increased again. If we cannot increase the death benefit
due to underwriting limits, we will return the amount of policy value necessary
so that the death benefit will be equal to the applicable percentage of your
policy value after returning the amount.
We will perform any necessary action within 60 days of the end of the policy
year in which the requirement has not been met.
We reserve the right to amend the policy to comply with:
1. Future changes in the Internal Revenue Code;
2. Any regulations or rulings issued under the code; and
3. Any other requirements imposed by the Internal Revenue Service.
We will give you a copy of any such amendment.
settlement
The net death benefit, or the net surrender value in the event you withdraw it,
will be paid in one sum or applied to any settlement option we then provide.
Settlement options will include:
Option 1
Interest
We will hold the proceeds at interest, and pay out the funds when the person
entitled to them requests.
Option 2
Fixed Payments
We will pay a selected monthly income until the proceeds, with interest, are
exhausted.
Option 3
Life Income - Guaranteed Period Certain
We will pay the proceeds in a monthly income for as long as the payee lives.
Guarantee periods may be selected between 5 and 20 years. If a guarantee period
is selected, payments will continue until the later of the death of the payee or
the end of the guarantee period. If the payee dies before the end of the
guarantee period, we will continue payments to a successor payee. If no
guarantee period is selected, then payments will cease after the death of the
payee. It is possible for the payee to receive only one payment under this
option, if the payee dies before the second payment is due.
Option 4
Joint and Survivor
We will pay the proceeds in a monthly income to two payees for as long as either
payee is alive. Payments will stop when both payees have died. It is possible
for the payees to receive only one payment, if both payees die before the second
payment is due.
VUL 9390 Page 14
Option 5
Period Certain
We will pay the proceeds in monthly installments for a specified number of
years, from 5 to 25. If the payee dies before the end of the specified period,
the remaining guaranteed payments will be paid to a successor payee.
Other Options
We may have other options available. Information about them may be obtained by
writing or calling us.
At the time the proceeds are payable, we will inform you concerning the rate of
interest to be paid on funds left with us. We guarantee that the rate of
interest will not be less than 3-1/2%. We may pay interest in excess of the
guaranteed rate. We will issue a supplementary contract setting forth the
benefits to be paid and the rights of the beneficiary. Each election must
include at least $5,000.00 of policy proceeds must result in installment
payments of not less than $50.00.
EXCHANGE OF PLAN
Any time during the first two policy years, you may exchange this policy without
evidence of insurability for a life insurance policy on the life of the insured
on such plan as is offered by us for exchanges from this policy. The new policy
will not have death benefits that vary with the investment experience of a
separate account. It will have the same issue date, issue age and risk
classification as this policy.
You may elect that the new policy either have the same death benefit initially
or the same net amount at risk initially as this policy has on the last day it
is in force.
To effect this exchange, you must return this policy to us at our home office
along with a completed application for exchange. It must be signed by you. We
must also receive;
a. The release of any lien against or assignment of this policy. You may
instead submit written approval by the lienholder or assignee of this
policy.
b. The surrender and release of this policy.
c. Payment of any exchange adjustments due us as described below.
The date of exchange will be the first day to occur, on or after receipt at our
home office of all items required for the exchange, that is the same day of the
month as this policy's anniversary.
If the surrender value of the new policy on the date of exchange is greater than
the surrender value of this policy on that date, then the exchange will be
subject to your payment to us of an exchange adjustment equal to the difference.
Otherwise, we will pay you an exchange adjustment equal to the excess on the
date of exchange of the surrender value of this policy over the surrender value
of the new policy.
The new policy will take effect on the date of exchange. When the new policy
takes effect, this policy terminates and is no longer in force.
To the extent the loan value of the new policy is sufficient security, the new
policy will be subject to any loans against this policy. The loan rate under the
new policy will be the rate used by us in the jurisdiction in which the new
policy is issued on the date of exchange.
Unless otherwise provided in the exchange application, the owner and the
beneficiary under the new policy will be the same as under this policy. Any
subsequent changes will be governed by the printed provisions of the new policy.
The application and evidences of insurability submitted for issuance of this
policy shall be included as part of the exchange application for the new policy.
Any rider benefits included in this policy will be included in the new policy
according to our rules applicable to the new policy on its policy date. The new
policy will conform to all of the requirements of the jurisdiction in which it
is issued regardless of any terms of this provision providing to the contrary.
deferment of payments
We will pay any amounts due under this contract within seven days, unless:
. The New York Stock Exchange is closed for other than usual weekends or
holidays, or trading on such exchange is restricted;
. An emergency exists as defined by the Securities and Exchange Commission; or
VUL 9390 Page 15
. The Securities and Exchange Commission permits delay for the protection of
contract holders.
assets of separate account
The assets of the separate account will be available to cover the liabilities of
our general account only to the extent that the assets exceed the liabilities of
the separate account arising under the variable life policies supported by the
separate account.
separate account modifications
We reserve the right, subject to applicable law, to make additions to, deletions
from, or substitutions for the mutual fund shares underlying the subaccounts of
the separate account. We will not substitute any share attributable to your
interest in a subaccount without notice to you and prior approval of the
Securities and Exchange Commission, to the extent required by the Investment
Company Act of 1940, and the Nebraska Insurance Commissioner. The approval
process in on file with the insurance commissioner of the state where this
policy is delivered.
We reserve the right to establish additional subaccounts each of which would
invest in shares of another mutual fund. You may then instruct us to allocate
purchase payments to such subaccounts, subject to any terms set by us or the
mutual fund.
In the event of any such substitution or change, we may by endorsement make such
changes as may be necessary or appropriate to reflect such substitution or
change.
If we deem it to be in the best interests of persons having voting rights under
the contracts, the separate account may be operated as a management company
under the Investment Company Act of 1940 or it may be deregistered under such
Act in the event such registration is no longer required.
VUL 9390 Page 16
FLEXIBLE PREMIUM VARIABLE LIFE POLICY
Minimum Premium Required in the First Year
Death Benefit Payable on the Insured's Death
Flexible Premiums Payable for Life
Amount of Death Benefit or Surrender Value may vary,
reflecting investment experience of the Separate Account
Nonparticipating
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