FLEXIBLE PREMIUM
ING USA DEFERRED VARIABLE
ANNUITY AND LIFE ANNUITY CONTRACT
INSURANCE COMPANY
ING USA is a stock company domiciled in Iowa.
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Annuitant Owner
[XXXXXX X. XXX] [XXXX X. XXX]
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Initial Premium Income Option Annuity Commencement Date
[$10,000] [LIFE 10-YEAR CERTAIN] [JANUARY 1, 2026]
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Separate Account(s) Contract Number
[SEPARATE ACCOUNT B] [123456]
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This is a legal Contract between its Owner and Us. In this Contract you or your
refers to the Owner shown above. We, our or us refers to ING USA Annuity and
Life Insurance Company. You may allocate this Contact's Accumulation Value to
the various Subaccounts of the Separate Account.
If this Contract is in force, we will make income payments to you starting on
the Annuity Commencement Date. If you die prior to the Annuity Commencement
Date, we will pay a death benefit to the Beneficiary. The amount of such benefit
is subject to the terms of this Contract.
ALL PAYMENTS AND VALUES ARE BASED ON THE INVESTMENT EXPERIENCE OF THE ELECTED
SUBACCOUNT(S) OF THE SEPARATE ACCOUNT AND MAY INCREASE OR DECREASE, DEPENDING ON
THE SUBACCOUNTS' INVESTMENT RESULTS. PROVISIONS REGARDING THE VARIABLE NATURE OF
THIS CONTRACT ARE FOUND ON PAGES 12-14.
RIGHT TO EXAMINE THIS CONTRACT: YOU MAY RETURN THIS CONTRACT TO US OR THE AGENT
THROUGH WHOM YOU PURCHASED IT WITHIN 10 DAYS AFTER YOU RECEIVE IT. IF SO
RETURNED, WE WILL TREAT THE CONTRACT AS THOUGH IT WERE NEVER ISSUED. UPON
RECEIPT, WE WILL PROMPTLY REFUND THE ACCUMULATION VALUE PLUS ANY CHARGES WE HAVE
DEDUCTED AS OF THE DATE THE RETURNED CONTRACT IS RECEIVED BY US.
Secretary:
[/s/Xxxxx Xxxxxxx-Xxxxxxx]
Customer Service Center
[P.O. Box 9271
Des Moines, IA 50306-9271
0-000-000-0000] President:
[/s/Xxxxx X. Xxxxx]
FLEXIBLE PREMIUM DEFERRED VARIABLE ANNUITY CONTRACT - NON-PARTICIPATING
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Premiums payable during first [two] Contract Years. Variable Cash Surrender
Values while the Annuitant and Owner are living and prior to the Annuity
Commencement Date. Death Benefit subject to guaranteed minimum. Partial
Withdrawal Option. Investment results reflected in values.
IU-CA-3020
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CONTRACT CONTENTS
IMPORTANT TERMS ............................ 3 YOUR CONTRACT BENEFITS .................... 15
Cash Value Benefit
THE SCHEDULE(1) ............................ 5 Partial Withdrawal Option
Payment and Investment Information Surrender Charge
Contract Facts Proceeds Payable to the Beneficiary
Charges and Fees Death Benefit
Income Plan Factors
CHOOSING AN INCOME PLAN ................... 19
INTRODUCTION TO THIS CONTRACT .............. 9 Income Benefits
The Contract Annuity Commencement Date Selection
The Owner Frequency Selection
The Annuitant The Income Plan
The Beneficiary The Income Options
Change of Owner or Beneficiary Payment When Named Person Dies
PREMIUM PAYMENTS AND ALLOCATION CHANGES .... 11 OTHER IMPORTANT INFORMATION ............... 21
Initial Premium Sending Notice to Us
Additional Premium Payments Reports to Owner
Your Right to Change Allocation of Assignment - Using this Contract as
Accumulation Value Collateral Security
What Happens if a Subaccount Contract Changes - Applicable Tax Law
is Not Available Misstatement of Age or Sex
Non-Participating
HOW WE MEASURE THE CONTRACT'S VALUE ........ 12 Contestability
The Separate Account Payments We May Defer
When the Subaccount is Valued Authority to Make Agreements
Accumulation Value Required Note on Our Computations
Accumulation Value in each Subaccount
Measurement of Investment Experience
Charges Deducted from Accumulation Value on
each Contract Processing Date
Copies of any additional Riders and Endorsements are at the back of this
Contract.
(1)THE SCHEDULE
The Schedule gives specific facts about this Contract and its coverage. Please
refer to the Schedule while reading this Contract.
IU-IA-3020 2
IMPORTANT TERMS
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ACCUMULATION VALUE - The amount that a Contract provides for investment at any
time. Initially, this amount is equal to the premium paid.
ANNUITANT - The person designated by you to be the measuring life in determining
Income Payments.
ANNUITY COMMENCEMENT DATE - The date on which Income Payments begin.
ATTAINED AGE - Your age, or that of the Annuitant, on the Contract Date plus the
number of full years elapsed since the Contract Date.
BENEFICIARY - The person designated to receive benefits in the case of your
death.
BUSINESS DAY - Any day the New York Stock Exchange ("NYSE") is open for trading,
exclusive of federal holidays, or any day on which the Securities and Exchange
Commission ("SEC") requires that mutual funds, unit investment trusts or other
investment portfolios be valued.
CASH SURRENDER VALUE - The amount you receive upon surrender of the Contract.
CONTRACT ANNIVERSARY - The anniversary of the Contract Date.
CONTRACT DATE - The date we receive the initial premium and upon which we begin
determining the Contract values. It may not be the same as the Issue Date. This
date is used to determine Contract months, processing dates, years, and
anniversaries.
CONTRACT PROCESSING DATE - The day when we deduct certain charges from the
Accumulation Value. If the Contract Processing Date is not a Valuation Date, it
will be on the next succeeding Valuation Date. The Contract Processing Date will
be on the Contract Anniversary of each year.
CONTRACT PROCESSING PERIOD - The period between successive Contract Processing
Dates unless it is the first Contract Processing Period. In that case, it is the
period from the Contract Date to the first Contract Processing Date.
CONTRACT YEAR - The period between Contract Anniversaries.
CONTINGENT ANNUITANT - The person designated by you who, upon the Annuitant's
death prior to the Annuity Commencement Date, becomes the Annuitant.
IU-IA-3020 3
IMPORTANT TERMS (continued)
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INCOME OPTION - Option you select that determines the form and amount of Income
Payments.
INCOME PAYMENT - The periodic payment you receive.
INITIAL PREMIUM - The payment amount required to put each Contract into effect.
ISSUE AGE - Your age, or that of the Annuitant, on the last birthday on or
before the Contract Date.
ISSUE DATE - The date the Contract is issued at our Customer Service Center.
MEASURING LIFE - The life used to determine the payment of Income Payments.
NET INVESTMENT FACTOR - The factor which reflects the investment experience of
the portfolio in which a Subaccount invests and also reflects the charges
assessed against the Subaccount for a Valuation Period.
OWNER - The person who owns this Contract and is entitled to exercise all rights
of the Contract. This person's death also triggers payment of the Death Benefit.
ROLL-UP RATE - Annual effective interest rate at which the Roll-up Value
accumulates during the first 10 Contract Years.
SUBACCOUNT - An investment option available in the Separate Account.
SPECIALLY DESIGNATED SUBACCOUNT - The Subaccount shown in the Schedule to which
distributions from an investment portfolio underlying a Subaccount in which
reinvestment is not available will be allocated, unless you specify otherwise.
VALUATION DATE - The day at the end of a Valuation Period when each Subaccount
is valued.
VALUATION PERIOD - Each business day together with any non-business days before
it.
IU-IA-3020 4
THE SCHEDULE
PAYMENT AND INVESTMENT INFORMATION
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Annuitant Owner
[XXXXXX X. XXX] [XXXX X. XXX]
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Annuitant's Issue Age Annuitant's Sex Owner's Issue Age
[55] [MALE] [35]
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Initial Premium Income Option Annuity Commencement Date
[$10,000] [LIFE 10-YEAR CERTAIN] [JANUARY 1, 2026]
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Contract Date Issue Date Residence Status
[JANUARY 1, 1996] [JANUARY 1, 1996] [IOWA]
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Separate Account(s) Contract Number
[SEPARATE ACCOUNT B] [123456]
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INITIAL INVESTMENT
Initial Premium received: [$10,000]
Your initial Accumulation Value has been invested as follows:
Percentage of
Subaccounts Accumulation Value
----------- ------------------
[ING Liquid Assets] [100%]
---------------------------------------- ------------------------------------
Total 100%
ROLL-UP RATE
[1.5%] annual effective rate for the first 10 Contract Years and 0.0%
thereafter.
ADDITIONAL PREMIUM PAYMENT INFORMATION
We will accept additional Premium Payments until the earlier of the date (a)
either the Annuitant or Owner reaches the Attained Age of [80]; and (b) [two]
years after the Contract Date. However, if this Contract is issued as an IRA, no
contributions may be made for the taxable year in which you attain age 70 1/2
and thereafter (except for rollover contributions).
The minimum additional Premium Payment which may be made is $50.00. If the
Contract's total premiums exceed $1,000,000, any additional Premium Payment
requires our prior approval.
ALLOCATION CHANGES BY TELEPHONE
You may request allocation changes by telephone during our telephone request
business hours. You may call our Customer Service Center at the number shown on
the cover page to make allocation changes by using the personal identification
number you will receive. You may also mail any notice or request for allocation
changes to our Customer Service Center at the address shown on the cover page.
IU-IA-3020 5
THE SCHEDULE
CONTRACT FACTS
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Annuitant Owner
[XXXXXX X. XXX] [XXXX X. XXX]
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Initial Premium Income Option Annuity Commencement Date
[$10,000] [LIFE 10-YEAR CERTAIN] [JANUARY 1, 2026]
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Separate Account(s) Contract Number
[SEPARATE ACCOUNT B] [123456]
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CONTRACT FACTS
Contract Processing Date
The Contract Processing Date for your Contract is [April 1] of each year.
Specially Designated Subaccount
When a distribution is made from an investment portfolio underlying a Subaccount
in which reinvestment is not available, we will allocate the amount of the
distribution to the [Liquid Asset Subaccount] unless you specify otherwise. We
also reserve the right to allocate premium to the [Liquid Asset Subaccount]
during any Right to Examine period.
IU-IA-3020 6
THE SCHEDULE
CHARGES AND FEES
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Annuitant Owner
[XXXXXX X. XXX] [XXXX X. XXX]
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Initial Premium Income Option Annuity Commencement Date
[$10,000] [LIFE 10-YEAR CERTAIN] [JANUARY 1, 2026]
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Separate Account(s) Contract Number
[SEPARATE ACCOUNT B] [123456]
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DEDUCTIONS FROM ACCUMULATION VALUE
Administrative Charge
We charge a maximum annual charge of $30 to cover a portion of our ongoing
administrative expenses. The charge is deducted on each Contract Anniversary and
at surrender. If the Contract Anniversary or surrender fall on a non-business
day, the charge is deducted on the next business day. At the time of deduction,
this charge will be waived if:
(1) The Accumulation Value is at least $50,000; or
(2) The sum of premiums paid to date is at least $50,000.
Mortality and Expense Risk Charge
We deduct a charge from the assets in each Subaccount on a daily basis for
mortality and expense risks. This charge is based on the number of years this
Contract has been in force, as follows:
---------------------- ---------------------- ---------------------------------
Contract Year: The Maximum Daily Equivalent to an Annual Maximum
Charge Is: Rate of:
---------------------- ---------------------- ---------------------------------
1-10 [0.006936%] [2.50%]
---------------------- ---------------------- ---------------------------------
11+ [0.005535%] [2.00%]
---------------------- ---------------------- ---------------------------------
Transfer Charge
[$25] for transfers in excess of 12 per Contract Year. Any charge will be
deducted in proportion to the amount being transferred from each Subaccount.
Surrender Charge
Complete Years Elapsed
Since Premium Payment 0 1 2 3 4 5+
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Surrender Charges 6% 6% 5% 4% 3% 0%
Premium Taxes
We deduct the amount of any premium or other state and local taxes levied by any
state or governmental entity when such taxes are incurred. We reserve the right
to defer collection of Premium Taxes until the Contract is surrendered or until
application of the Contract's Accumulation Value to an Income Option. An Excess
Partial Withdrawal will result in the deduction of any Premium Tax then due us
on such amount. We reserve the right to change the amount we charge for Premium
Taxes on future Premium Payments to conform with changes in the law or if you
change your state of residence.
Redemption Fees
We may deduct the amount of any redemption fees imposed by a mutual fund or
other investment company in which the Subaccounts invest as a result of any
surrenders, partial withdrawals, reallocations or other transactions directed by
you.
IU-IA-3020 7
THE SCHEDULE
INCOME PLAN FACTORS
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Annuitant Owner
[XXXXXX X. XXX] [XXXX X. XXX]
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Initial Premium Income Option Annuity Commencement Date
[$10,000] [LIFE 10-YEAR CERTAIN] [JANUARY 1, 2026]
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Separate Account(s) Contract Number
[SEPARATE ACCOUNT B] [123456]
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Values for other payment periods, ages or joint life combinations are available
on request. Monthly payments are shown for each $1,000 applied.
OPTION 1: INCOME FOR A FIXED PERIOD
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Rates for Fixed Annuity Payments with a 1.5% Guaranteed Interest Rate
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Years Income Years Income Years Income
10 8.97 17 5.55 24 4.13
11 8.22 18 5.28 25 3.99
12 7.59 19 5.04 26 3.87
13 7.05 20 4.82 27 3.75
14 6.60 21 4.62 28 3.64
15 6.20 22 4.44 29 3.54
16 5.86 23 4.28 30 3.45
OPTION 2: INCOME FOR LIFE (SINGLE ANNUITANT)
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Rates for Fixed Annuity Payments with a 1.5% Guaranteed Interest Rate
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Option 2(a) Option 2(b)
Adjusted Age 10 Years Certain 20 Years Certain
Male/Female Male/Female
50 $3.23/3.00 $3.15/2.96
55 3.61/3.33 3.46/3.25
60 4.09/3.75 3.80/3.59
65 4.71/4.30 4.15/3.97
70 5.47/5.02 4.45/4.34
75 6.35/5.93 4.66/4.61
80 7.25/6.96 4.77/4.75
85 8.02/7.89 4.81/4.81
90 8.56/8.50 4.82/4.82
IU-IA-3020 8
INTRODUCTION TO THIS CONTRACT
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THE CONTRACT
This Contract, together with any attached Riders or Endorsements, constitutes
the entire Contract. Riders and Endorsements added to comply with applicable tax
law do not require your consent, but are subject to regulatory approval.
THE OWNER
You are the Owner of this Contract. You are also the Annuitant unless another
Annuitant has been named by you and is shown in the Schedule. You have the
rights and options described in this Contract, including but not limited to the
right to receive the Income Benefits on the Annuity Commencement Date.
One or more people may own this Contract. In the case of a sole Owner who dies
prior to the Annuity Commencement Date, we will pay the Beneficiary the Death
Benefit then due. If the sole Owner is not an individual, we will treat the
Annuitant as Owner for the purpose of determining when the Owner dies under the
Death Benefit provision. The sole Owner's estate will be the Beneficiary if no
Beneficiary designation is in effect, or if the designated Beneficiary has
predeceased the Owner. In the case of a Joint Owner dying prior to the Annuity
Commencement Date, the surviving Owner(s) will be deemed to be the
Beneficiary(ies) and any other Beneficiary(ies) on record will be treated as the
contingent Beneficiary(ies).
THE ANNUITANT
The Annuitant is the Measuring Life for the Income Benefits provided under this
Contract. The Annuitant must be a natural person. You may name a Contingent
Annuitant. The Annuitant may not be changed during the Annuitant's lifetime.
If the Annuitant dies before the Annuity Commencement Date, the Contingent
Annuitant becomes the Annuitant. You will be the Contingent Annuitant unless you
name someone else. If no Contingent Annuitant has been named, we will allow you
sixty days to designate someone other than yourself as the Annuitant. If all
Owners are not individuals, we will pay the death proceeds to the Beneficiary
upon the death of the Annuitant. If there are Joint Owners, we will treat the
youngest of the Owners as the Contingent Annuitant designated, unless you elect
otherwise.
THE BENEFICIARY
The Beneficiary is the person to whom we pay the Death Benefit if any Owner dies
prior to the Annuity Commencement Date. See "Proceeds Payable to the
Beneficiary" for more information. We pay Death Benefits to the primary
Beneficiary (unless there are Joint Owners in which case the Death Benefit is
payable to the surviving Owner). If the primary Beneficiary dies before the
Owner, the Death Benefit is paid to the Contingent Beneficiary, if any. If there
is no surviving Beneficiary, we pay the Death Benefit to the Owner's estate.
IU-IA-3020 9
INTRODUCTION TO THIS CONTRACT (continued)
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One or more persons may be named as primary Beneficiary or contingent
Beneficiary. In the case of more than one Beneficiary, unless you specify
otherwise, the Death Benefit will be paid in equal shares to the surviving
Beneficiaries.
Unless you designate an irrevocable Beneficiary, you have the right to change
Beneficiaries. When an irrevocable Beneficiary has been designated, you and the
irrevocable Beneficiary may have to act together to exercise the rights and
options under this Contract.
When naming or changing the Beneficiary(ies), you may specify the form of
payments of the Death Benefit. We will honor the specified form of payment to
the extent permitted under Section 72(s) of the Internal Revenue Code of 1986,
as amended ("the Code"). If the form of payment is not specified, the
Beneficiary(ies) may determine the manner of payment, to the extent allowed by
the Code.
CHANGE OF OWNER OR BENEFICIARY
During your lifetime and while this Contract is in effect, you may transfer
ownership of this Contract or change the Beneficiary. To make any of these
changes, you must send us written notice of the change in a form satisfactory to
us. If there are multiple (Joint) Owners, all must agree to the change. The
change will take effect as of the day the notice is signed. The change will not
affect any payment made or action taken by us before recording the change at our
Customer Service Center. A Change of Owner may affect the Benefit payable under
this Contract. See the "Death Benefit" provision.
IU-IA-3020 10
PREMIUM PAYMENTS AND ALLOCATION CHANGES
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INITIAL PREMIUM
The payment of the Initial Premium is required to put this Contract into effect.
The amount of the Initial Premium is shown in the Schedule.
ADDITIONAL PREMIUM PAYMENTS
You may make additional Premium Payments under this Contract after the Right to
Examine period ends. Restrictions on additional Premium Payments, such as Age,
the period during which we will accept additional Premium Payments, and the
timing and amount of each payment, are shown in the Schedule. We reserve the
right to accept additional Premium Payments beyond the period stated in the
Schedule. We also reserve the right to defer acceptance of or return any
additional Premium Payments if:
o they exceed the restrictions stated in the Schedule;
o a Subaccount to which they are allocated is closed; or
o in order to comply with any law or regulation.
As of the date we receive and accept your additional Premium Payment:
(1) The Accumulation Value will increase by the amount of the additional
Premium Payment less any applicable deductions shown in the Schedule.
(2) The increase in the Accumulation Value will be allocated among the
Subaccounts in accordance with your instructions. If you do not
provide such instructions, allocation will be among the Subaccounts in
proportion to the amount of Accumulation Value in each Subaccount as
of the date we receive and accept the additional Premium Payment.
Where to Make Payments
Remit additional Premium Payments to our Customer Service Center at the address
shown on the cover page. On request, we will give you a receipt signed by our
Treasurer.
YOUR RIGHT TO CHANGE ALLOCATION OF ACCUMULATION VALUE
You may change the allocation of the Accumulation Value among the Subaccounts of
the Separate Account after the Right to Examine period ends. Prior to the
Annuity Commencement Date, allocation changes in excess of twelve in any
Contract Year are subject to the Transfer Charge as stated in the Schedule.
Allocated values may be reduced by any Redemption Fees. To make an allocation
change, you must provide us with satisfactory notice at our Customer Service
Center. The change will take effect when we receive the notice.
We will monitor transfer activity and will restrict transfers that constitute
Frequent Trading. Our current definition of Frequent Trading is more than one
purchase and sale of the same underlying fund within a 30-day period. We may
modify our standard, or the standard as it may apply to a particular fund, at
any time without prior notice, if required by the underlying fund(s) in which
the Subaccounts invest and/or state or federal regulatory requirements. We will
notify you within 30 days of such modification.
WHAT HAPPENS IF A SUBACCOUNT IS NOT AVAILABLE
If your instructions include allocations to a Subaccount which is no longer
available, we will allocate the distribution to the Specially Designated
Subaccount shown in the Schedule unless you specify otherwise.
To elect an allocation to other than the Specially Designated Subaccount shown
in the Schedule, you must provide satisfactory notice to us. Such allocations
will not be counted as an allocation change for purposes of the number of free
allocations permitted.
IU-IA-3020 11
HOW WE MEASURE THE CONTRACT'S VALUE
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The benefits under this Contract are provided through investments in our
Separate Account (the "Account"), a unit investment trust, organized in and
governed by the laws of the State of Iowa, our state of Domicile. The Account is
divided into Subaccounts, each of which is available for investment under this
Contract.
THE SEPARATE ACCOUNT
The Account is kept separate from our general account and any other separate
accounts we may have. It is used to support Variable Annuity Contracts and may
be used for other purposes permitted by applicable laws and regulations. We own
the assets in the Account. Assets equal to the reserves and other liabilities of
the Account will not be charged with liabilities that arise from any other
business we conduct; but, we may transfer to our general account assets which
exceed the reserves and other liabilities of the Account. Xxxxxx and realized
and unrealized gains or losses from assets in the Account are credited to or
charged against the Account without regard to other income, gains or losses in
our other general and separate accounts.
The Account will invest in mutual funds, unit investment trusts and other
investment portfolios which we determine to be suitable for this Contract's
purposes. The Account is treated as a unit investment trust under Federal
securities laws. It is registered with the Securities and Exchange Commission
("SEC") under the Investment Company Act of 1940.
Subaccounts
The Account is divided into Subaccounts, each investing in a designated
investment portfolio. The Subaccounts and the investment portfolios may be
managed by a separate investment adviser. Such adviser may be registered under
the Investment Advisers Act of 1940.
Changes within the Account
We may, from time to time, make additional Subaccounts available to you. These
Subaccounts will invest in investment portfolios we find suitable for this
Contract. We also have the right to eliminate Subaccounts from the Account, to
combine two or more Subaccounts or to substitute a new portfolio for the
portfolio in which a Subaccount invests. A substitution may become necessary if,
in our judgment, a portfolio or Subaccount no longer suits the purpose of this
Contract. This may happen due to a change in laws or regulations, a change in a
portfolio's investment objectives or restrictions, because the portfolio or
Subaccount is no longer available for investment, or for some other reason. We
will obtain any required regulatory approvals before making such a substitution.
Subject to any required regulatory approvals, we reserve the right to transfer
assets of the Account or Subaccount attributable to the class of contracts to
which this Contract belongs to another Account or Subaccount.
When permitted by law, we reserve the right to:
(1) deregister the Account under the Investment Company Act of 1940;
(2) operate the Account as a management company under the Investment
Company Act of 1940, if it is operating as a unit investment trust;
(3) operate the Account as a unit investment trust under the Investment
Company Act of 1940, if it is operating as a managed Account;
(4) restrict or eliminate any voting rights of Owners, or other persons
who have voting rights to the Account; and
(5) combine the Account with other Accounts.
IU-IA-3020 12
HOW WE MEASURE THE CONTRACT'S VALUE (continued)
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WHEN THE SUBACCOUNT IS VALUED
Each Subaccount will be valued at the end of each Valuation Period on a
Valuation Date.
ACCUMULATION VALUE
The Contract's Accumulation Value is the sum of the amounts in each of the
Subaccounts. You select how to allocate the Accumulation Value among the
available Subaccounts.
ACCUMULATION VALUE IN EACH SUBACCOUNT
On the Contract Date
On the Contract Date, the Accumulation Value is allocated to each Subaccount as
elected by you, subject to certain terms and conditions imposed by us. We
reserve the right to allocate premium to the Specially Designated Subaccount
during any Right to Examine period. After such time, allocation will be made
proportionately in accordance with the initial allocation(s) as elected by you.
On each Valuation Date
Subject to the "One-Time Roll-up Benefit" as described below, at the end of each
subsequent Valuation Period, the amount of Accumulation Value in each Subaccount
will be calculated as follows:
(1) We take the Accumulation Value in the Subaccount at the end of the
preceding Valuation Period.
(2) We multiply (1) by the Subaccount's Net Rate of Return for the current
Valuation Period.
(3) We add (1) and (2).
(4) We add to (3) any additional Premium Payments allocated to the
Subaccount during the current Valuation Period.
(5) We add or subtract transfers to or from that Subaccount during the
current Valuation Period.
(6) We subtract from (5) any Partial Withdrawals from the Subaccount
during the current Valuation Period.
(7) We subtract from (6) the amounts deducted from that Subaccount for
Surrender Charges, Administrative Charges, Transfer Charges, and
Premium Taxes as shown in the Schedule.
One-time Roll-up Benefit
On the 10th Contract Anniversary, if the Roll-up Value exceeds the Accumulation
Value, the excess ("Roll-up Benefit") will be credited to the Accumulation
Value. The Roll-up Benefit, if any, will be allocated pro-rata to the
Subaccounts in accordance with the allocation of Accumulation Value immediately
preceding the crediting of the Roll-up Benefit (see "Roll-up Value" in "Your
Contract Benefits"). This is a one-time increase. The Accumulation Value with
the Roll-up Benefit will serve as the Subaccount's Accumulation Value described
in (1) above for the purpose of calculating the Accumulation Value in that
Subaccount for the following Valuation Period.
MEASUREMENT OF INVESTMENT EXPERIENCE
Index of Investment Experience
The Index of Investment Experience is used to measure the performance of a
Subaccount. The Investment Experience of a Subaccount is determined on each
Valuation Date. We use an Index to measure changes in each Subaccount's
experience during a Valuation Period. We set the Index at $10 when the first
investment in a Subaccount is made. The Index for a current Valuation Period
equals the Index for the preceding Valuation Period multiplied by the Net Return
Factor for the current Valuation Period.
IU-IA-3020 13
HOW WE MEASURE THE CONTRACT'S VALUE (continued)
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How We Determine the Net Return Factor
For each Subaccount, the Net Return Factor reflects the Investment Experience of
the portfolio in which the Subaccount invests as well as the charges assessed
against the Subaccount for a Valuation Period. The factor is calculated as
follows:
(1) We take the net asset value of the portfolio in which the Subaccount
invests at the end of the current Valuation Period.
(2) We add to (1) the amount of any dividend or capital gains distribution
declared for the investment portfolio and reinvested in such portfolio
during the current Valuation Period. We subtract from that amount a
charge for our premium taxes, if any.
(3) We divide (2) by the net asset value of the portfolio at the end of
the preceding Valuation Period.
(4) We subtract the daily Mortality and Expense Risk Charge for each
Subaccount described in the Schedule for each day in the Valuation
Period.
Calculations for Subaccounts investing in unit investment trusts are on a per
unit basis.
Subaccount Net Rate of Return
The Net Rate of Return for a Subaccount during a Valuation Period is the Net
Return Factor for that Valuation Period minus one.
CHARGES DEDUCTED FROM ACCUMULATION VALUE ON EACH CONTRACT PROCESSING DATE
Expense charges and fees are shown in the Schedule.
IU-IA-3020 14
YOUR CONTRACT BENEFITS
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While this Contract is in effect, there are important rights and benefits that
are available to you. We discuss these rights and benefits in this section.
CASH VALUE BENEFIT
Cash Surrender Value
Before the Annuity Commencement Date, the Cash Surrender Value is determined as
follows:
(1) We take the Contract's Accumulation Value;
(2) We deduct any Surrender Charges;
(3) We deduct any charges shown in the Schedule that have been incurred
but not yet deducted, including: (a) any administrative charge that
has not yet been deducted; (b) any applicable premium tax; and (c) any
Redemption Fees.
Cancelling to Receive the Cash Surrender Value
You may surrender this Contract on or before the Annuity Commencement Date. To
do this, you must return this Contract with a signed request for cancellation to
our Customer Service Center. The Cash Surrender Value will vary daily. We will
determine the Cash Surrender Value as of the date we receive the Contract and
your signed request in our Customer Service Center. All benefits under this
Contract will then end. We will usually pay the Cash Surrender Value within
seven days; but, we may delay payment as described in the "Payments We May
Defer" provision.
PARTIAL WITHDRAWAL OPTION
You must provide us satisfactory notice at our Customer Service Center to take a
Partial Withdrawal. The maximum amount that may be withdrawn in each Contract
Year without being considered an Excess Partial Withdrawal is described below.
We will collect a Surrender Charge and any unrecovered Premium Taxes for Excess
Partial Withdrawals. For purposes of determining the Surrender Charge,
withdrawals are considered to come from premiums in the same order as paid
("first in, first out" basis). A Partial Withdrawal may be reduced by any
Redemption Fees.
A Partial Withdrawal request will be deemed a surrender of the Contract if it:
(a) exceeds 90% of the Cash Surrender Value determined as of the date the
withdrawal request is received; and (b) reduces the Cash Surrender Value after
such withdrawal to less than $2,500.
Minimum Withdrawal Amount
The Minimum Withdrawal Amount that can be taken is $100.
Conventional Partial Withdrawals
The maximum amount that can be taken as a Conventional Partial Withdrawal each
Contract Year without being considered an Excess Partial Withdrawal is the Free
Amount. The Free Amount is equal to 10% of the Contract's Accumulation Value,
determined as of the date of withdrawal, less amounts previously withdrawn
during that Contract Year.
Systematic Partial Withdrawals
You may elect Systematic Partial Withdrawals commencing 28 days or later from
the Contract Date. Systematic Partial Withdrawals may be taken on a monthly,
quarterly or annual basis. You may select the day withdrawals will be made, but
no later than the 28th day of the month. If you do not elect a day, the same day
of the month as the Contract Date will be used.
IU-IA-3020 15
YOUR CONTRACT BENEFITS (continued)
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The Maximum Systematic Partial Withdrawal Amounts are 0.833% of the Accumulation
Value monthly, 2.5% of the Accumulation Value quarterly or 10% of the
Accumulation Value annually, not previously withdrawn.
Systematic Partial Withdrawals that do not exceed the Maximum Systematic Partial
Withdrawal Amounts are not subject to Surrender Charges.
Systematic Partial Withdrawals and Conventional Partial Withdrawals may not be
taken in the same Contract Year.
SURRENDER CHARGE
A Surrender Charge may be imposed as a percentage of premium not previously
withdrawn if the Contract is surrendered or an Excess Partial Withdrawal is
taken. The percentage imposed at time of surrender or Excess Partial Withdrawal
depends on the number of complete years that have elapsed since a Premium
Payment was made. The Surrender Charge is expressed as a percentage of each
Premium Payment not previously withdrawn and is shown in the Schedule.
Free Amounts are not treated as withdrawals of Premium Payments for purposes of
calculating any Surrender Charge.
PROCEEDS PAYABLE TO THE BENEFICIARY
Prior to the Annuity Commencement Date
If you die prior to the Annuity Commencement Date, we will pay the Beneficiary
the Death Benefit. If there are Joint Owners and any Owner dies, we will pay the
surviving Owner(s) the Death Benefit. We will pay the amount on receipt of due
proof of the Owner's death at our Customer Service Center. Such amount may be
received in a single lump sum or applied to any of the Income Options (see
"Choosing an Income Plan"). When the Owner (or any Owner where there are Joint
Owners) is not an individual, the Death Benefit will become payable on the death
of the Annuitant prior to the Annuity Commencement Date (unless a Contingent
Annuitant survived the Annuitant). Only one Death Benefit is payable under this
Contract. In all events, distributions under the Contract must be made as
required by applicable law.
How to Claim Payments
We must receive proof of the Owner's (or the Annuitant's - see above for when
the Annuitant's death is applicable) death before we will make any payments to
the Beneficiary. We will calculate the Death Benefit as of the Valuation Date on
or immediately subsequent to the date we receive due proof of death. The
Beneficiary should contact our Customer Service Center for instructions.
DEATH BENEFIT
If the Owner, or any Joint Owner, dies prior to the Annuitization Date, we will
pay the Beneficiary the Death Benefit.
The Death Benefit is the greater of:
(a) the Accumulation Value and
(b) the Roll-up Value.
IU-IA-3020 16
YOUR CONTRACT BENEFITS (continued)
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Roll-up Value
On the Contract Date, the Roll-up Value is the initial premium paid. On
subsequent Valuation Dates, the Roll-up Value is: (a) the Roll-up Value on the
prior Valuation Date; plus (b) interest, calculated at the Roll-up Rate (as
shown in the Schedule); plus (c) any additional premium paid during the current
Valuation Period; less (d) adjustments for any partial withdrawals made during
the current Valuation Period.
Partial Withdrawal Adjustments
For any Partial Withdrawals, the Roll-up Value will be reduced on a pro-rata
basis. The pro-rata adjustment is equal to (1) divided by (2) multiplied by (3)
where: (1) is the Accumulation Value withdrawn; (2) is the Accumulation Value
immediately prior to withdrawal; and (3) is the Roll-up Value immediately prior
to withdrawal.
Change of Owner
If there is a change in ownership (except for a change in trust as Owner where
the Contract is issued for the benefit of the Owner or Annuitant) including the
addition or deletion of a Joint Owner, the Roll-up Value will become and remain
$0 (zero) thereafter.
Spousal Beneficiaries
If, at the Owner's death, the surviving spouse of the deceased Owner is the
Beneficiary and the Roll-up Value as of the date we receive due proof of the
Owner's death, minus the Accumulation Value, also as of that date, is greater
than zero, we will add such difference to the Accumulation Value. Unless we are
directed otherwise, such addition will be allocated to the Subaccounts of the
Separate Account then available in the same proportion as the Accumulation Value
in each available Subaccount bears to the Accumulation Value in all such
Subaccounts. If there is no Accumulation Value in any Subaccount then available,
the addition will be allocated to the Specially Designated Subaccount.
Election by the surviving spouse to continue the Contract as their own pursuant
to Internal Revenue Code Section 72(s) or the equivalent provisions of U.S.
Treasury Department rules for qualified plans will not be considered a change of
Owner and the following will apply:
(1) The Contract's Roll-up Value calculation will not change as a result
of the re-set of Accumulation Value described in above.
(2) Additional Premium Payments are not allowed until we are notified of
the intent to continue the Contract as their own. Receipt of
additional premium will be deemed to be an election to continue the
Contract as their own.
(3) Surrender Charges applicable to premiums paid prior to the date we
receive due proof of death of the original Owner will be waived;
premiums paid thereafter will be subject to any applicable Surrender
Charge.
(4) The surviving spouse's Attained Age will be used to determine the age
at which additional Premium Payments are no longer accepted as stated
in the Schedule; the original Contract Date will be used to determine
the period during which additional premiums are allowed.
(5) At subsequent death of the surviving spouse, the Death Benefit will be
determined as provided above and the Contract will be terminated.
IU-IA-3020 17
YOUR CONTRACT BENEFITS (continued)
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Non-Spousal Beneficiary
If, at the Owner's death, the non-spouse Beneficiary of the deceased Owner
elects to continue the Contract for the purpose of taking distributions pursuant
to Internal Revenue Code Section 72(s) or the equivalent provisions of U.S.
Treasury Department rules for qualified plans, the following will apply:
(1) If the Roll-up Value as of the date we receive due proof of the Owner's
death, minus the Accumulation Value, also as of that date, is greater than
zero, we will add such difference to the Accumulation Value. Unless we are
directed otherwise, such addition will be allocated to the Subaccounts then
available in the same proportion as the Accumulation Value in each
available Subaccount bears to the Accumulation Value in all such
Subaccounts. If there is Accumulation Value in any Subaccount not then
available, the addition will be allocated to the Specially Designated
Subaccount.
(2) Upon determination of the Death Benefit, the Roll-up Value will become and
remain $0 (zero).
(3) The amount payable upon the death of the non-spouse Beneficiary, if such
beneficiary dies while receiving distributions under this Contract, will be
the Accumulation Value as of the date we receive due proof of such
Beneficiary's death.
(4) No additional Premium Payments may be made under this Contract following
the date we receive due proof of the Owner's death.
(5) At subsequent surrender, any applicable Surrender Charges will be waived.
IU-IA-3020 18
CHOOSING AN INCOME PLAN
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INCOME BENEFITS
If you and the Annuitant are living on the Annuity Commencement Date, we will
begin making payments to you. We will make these payments under the Income
Option (or Options) elected by you. You may elect to apply the Accumulation
Value (minus any applicable Premium Tax) to any Income Option by making a
written request at least 30 days prior to the Annuity Commencement Date. If no
Income Option has been elected by the Required Annuity Commencement Date,
payments will be made under Option 2 on a 10-year Period Certain basis. The
amount of the payments will be determined by applying the Accumulation Value on
the Annuity Commencement Date in accordance with the Income Options section
below (see "Payments We May Defer"). Before we pay any Income Benefits, we
require the return of this Contract. If this Contract has been lost, we require
the completed and returned applicable lost Contract form.
ANNUITY COMMENCEMENT DATE SELECTION
You select the Annuity Commencement Date. You may select any date following the
first Contract Anniversary but before the Required Annuity Commencement Date
stated below. On the Annuity Commencement Date, the age of the Annuitant plus
the number of years payments are guaranteed must not exceed 100. If you do not
select a date, the Annuity Commencement Date will be in the month following the
Required Annuity Commencement Date. If, on the Annuity Commencement Date, a
Surrender Charge remains and you elect Income Option 1, the Period Certain must
be of at least 10 years duration.
Required Annuity Commencement Date
The Annuity Commencement Date may be no later than the same date as the Contract
Processing Date in the month following the later of the Annuitant's 90th
birthday or 10 years after the last Premium Payment.
FREQUENCY SELECTION
Income Payments will be made monthly unless you direct otherwise in writing.
However, payments other than monthly, quarterly, semi-annually or annually
require our consent. Each Income Payment must equal at least $50.00 and the sum
of all Income Payments in any one year must equal at least $250.00. We have the
right to increase these minimums based upon increases reflected in the Consumer
Price Index - Urban (CPI-U) since January 1, 2005. If the option and frequency
elected do not meet these minimum requirements, we have the right to make
payments less frequently as necessary to do so.
THE INCOME PLAN
While this Contract is in effect and before the Annuity Commencement Date, you
may choose one or more Income Options for the payment of the Death Benefit. If,
at the time of your death, no Option has been chosen for paying the Death
Benefit, the Beneficiary may choose an Option within one year. You may also
elect an Income Option on surrender of the Contract. For each Option elected, we
will issue a separate written agreement putting the Option into effect.
Our approval is needed for any Option where:
(1) the person named to receive payment is other than you or the Beneficiary;
or
(2) the person named is not a natural person, such as a corporation; or
(3) any income payment would be less than the minimum Income Payment stated
above.
IU-IA-3020 19
CHOOSING AN INCOME PLAN (continued)
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THE INCOME OPTIONS
Option 1. Income for a Fixed Period
Monthly Payments are made in equal installments for a fixed number of years. The
number of years must be at least 10 and not more than 30.
Option 2. Single Life Income
Payment is made to the person named in equal monthly installments based on one
of the following, as elected by you:
(a) Payments continue as long as the Annuitant is living and cease at the
Annuitant's death.
(b) Payments continue for a Period Certain and continue thereafter as long
as the Annuitant is living. The Period Certain must be at least 10
years and not more than 30 years as specified by you.
Option 3. Joint Life Income
This Option is available if there are two Annuitants, one of whom is designated
the Primary Annuitant and the other the Secondary Annuitant. Monthly payments
continue as long as at least one of the Annuitants is living based on one of the
following, as elected by you:
(a) Payments continue as long as either Annuitant is living.
(b) Payments continue for a Period Certain and continue thereafter as long
as either Annuitant is living. The Period Certain must be at least 10
years and not more than 30 years as specified by you.
The minimum rates for Option 1 are based on 1.5% interest, compounded annually.
The minimum rates for Options 2 and 3 are based on 1.5% interest, compounded
annually, and the Annuity 2000 Mortality Table. Tables reflecting these minimum
guaranteed monthly rates per $1,000 applied are shown in the Schedule. We may
pay a higher rate at our discretion.
In addition to the Income Options described above, payments may be made under
any other method mutually agreed upon by you and us.
PAYMENT WHEN NAMED PERSON DIES
When the person named to receive payment dies, we will pay any amounts still due
as provided by the Annuity Option elected. The amounts still due are determined
as follows:
(1) For Option 1 or for any remaining guaranteed payments in Option 2,
payments will be continued.
(2) For Option 2(a), no amounts are payable after the Annuitant's death.
(3) For Option 3(a), no amounts are payable after the death of both
Annuitants.
IU-IA-3020 20
OTHER IMPORTANT INFORMATION
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SENDING NOTICE TO US
Whenever written notice is required, send it to our Customer Service Center. The
address of our Customer Service Center is shown on the cover page. Please
include your Contract number in all correspondence.
REPORTS TO OWNER
We will send you a report at least once during each Contract Year. The report
will show the Accumulation Value, Roll-up Value and the Cash Surrender Value as
of the end of the Contract Processing Period. The report will also show the
allocation of the Accumulation Value as of such date and the amounts deducted
from or added to the Accumulation Value since the last report. The report will
also include any information that may be currently required by the insurance
supervisory official of the jurisdiction in which the Contract is delivered.
We will also send you copies of any shareholder reports of the portfolios in
which the Subaccounts invest, as well as any other reports, notices or documents
required by law to be furnished to Owners.
ASSIGNMENT - USING THIS CONTRACT AS COLLATERAL SECURITY
You can assign this Contract as collateral security for a loan or other
obligation. This does not change the ownership. Your rights and any
Beneficiary's rights are subject to the terms of the assignment. The
Beneficiary's rights may be subordinate to those of an assignee unless the
Beneficiary was designated as irrevocable prior to the assignment. To make or
release an assignment, we must receive written notice satisfactory to us at our
Customer Service Center. We are not responsible for the validity of any
assignment.
CONTRACT CHANGES - APPLICABLE TAX LAW
We reserve the right to make changes in this Contract or its Riders to the
extent necessary to continue to qualify this Contract as an annuity. Any such
changes will apply uniformly to all Contracts that are affected. You will be
given advance written notice of such changes.
MISSTATEMENT OF AGE OR SEX
If an age or sex has been misstated, the amounts payable or benefits provided by
this Contract will be those that the Premium Payment made would have bought at
the correct age or sex.
NON-PARTICIPATING
This Contract does not participate in our divisible surplus.
IU-IA-3020 21
OTHER IMPORTANT INFORMATION (continued)
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CONTESTABILITY
This Contract is incontestable from its Issue Date.
PAYMENTS WE MAY DEFER
We may not be able to determine the value of the assets of the Subaccounts
because:
(1) The NYSE is closed for trading;
(2) the SEC determines that a state of emergency exists;
(3) an order or pronouncement of the SEC permits a delay for the
protection of Owners; or
(4) the check used to pay the premium has not cleared through the banking
system. This may take up to 15 days.
During such times, we may delay:
(1) determination and payment of the Cash Surrender Value;
(2) determination and payment of any Death Benefit if death occurs before
the Annuity Commencement Date;
(3) allocation changes of the Accumulation Value; or
(4) application of the Accumulation Value under an income plan.
AUTHORITY TO MAKE AGREEMENTS
All agreements made by us must be signed by one of our officers. No other
person, including an insurance agent or broker, has the authority to:
(1) change any of this Contract's terms;
(2) extend the time for Premium Payments; or
(3) make any agreement binding on us.
REQUIRED NOTE ON OUR COMPUTATIONS
We have filed a detailed statement of our computations with the insurance
supervisory official in the jurisdiction where this Contract is delivered. The
values are not less than those required by the law of that state or
jurisdiction.
IU-IA-3020 22
FLEXIBLE PREMIUM DEFERRED VARIABLE ANNUITY CONTRACT - NON-PARTICIPATING
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Premiums payable during first [two] Contract Years. Variable Cash Surrender
Values while the Annuitant and Owner are living and prior to the Annuity
Commencement Date. Death Benefit subject to guaranteed minimum. Partial
Withdrawal Option. Investment results reflected in values.
IU-IA-3020
