ML LIFE INSURANCE COMPANY OF NEW YORK
A Subsidiary of Xxxxxxx Xxxxx & Co., Inc.
Home Office: 000 Xxxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, XX 00000-0000
Annuity Service Center: P.O. Box 44222
Jacksonville, Florida 32231-4222
ML LIFE INSURANCE COMPANY OF NEW YORK will make periodic annuity payments for
the life of the Annuitant or as otherwise provided in this Contract. Payments
will be made to the Owner starting on the Annuity Date.
This is a legal Contract between you and us. PLEASE READ THE CONTRACT CAREFULLY.
EXCEPT FOR FIXED ANNUITY PAYMENTS, VALUES PROVIDED BY THIS CONTRACT ARE BASED
ON THE INVESTMENT EXPERIENCE OF THE SEPARATE ACCOUNT, ARE VARIABLE AND ARE NOT
GUARANTEED AS TO FIXED-DOLLAR AMOUNT.
TEN DAY RIGHT TO REVIEW CONTRACT: You may cancel this Contract within ten days
after you receive it. Simply return or mail it to us or your Financial
Consultant. We will refund the greater of the Contract Value or all of your
Premiums.
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TABLE OF CONTENTS
SECTION PAGE
Definitions ................................................................ 2
Contract Schedule .......................................................... 3
1. General Provisions ..................................................... 4
2. Premiums ............................................................... 6
3. The Separate Account ................................................... 6
4. Charges and Deductions ................................................. 7
5. Transfers .............................................................. 8
6. Withdrawals ............................................................ 8
7. Payment at Death ....................................................... 9
8. Annuity Provisions ..................................................... 11
9. Annuity Options ........................................................ 11
10. Annuity Option Tables .................................................. 13
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ML Life Insurance Company of New York is a stock life insurance company.
/s/ Xxxxxxx X. Xxxxx /s/ Xxxxx X. Xxxxxxxx
President Secretary
Flexible Premium Deferred
Variable Annuity Contract
Nonparticipating
DEFINITIONS
1. ACCUMULATION UNIT: A unit of measure used to compute the value of your
interest in a subaccount of the Separate Account prior to the Annuity Date.
2. ANNUITANT: Annuity payments may depend upon the continuation of a person's
life. That person is called the Annuitant.
3. ANNUITY DATE: The date on which annuity payments are scheduled to begin.
4. ATTAINED AGE: The age of a person on the Contract Date plus the number of
full contract years since the Contract Date.
5. BENEFICIARY: The person(s) designated by you to receive payment upon the
death of an Owner prior to the Annuity Date.
6. COMPANY: ML Life Insurance Company of New York. Also referred to as "we"
or "us".
7. CONTRACT ANNIVERSARY: The yearly anniversary of the Contract Date.
8. CONTRACT DATE: The effective date of the Contract as shown on the Contract
Schedule. This is usually the business day we receive your initial premium
at our Service Center.
9. CONTRACT VALUE: The value of your interest in the Separate Account.
10. CONTRACT YEAR: The period from the Contract Date to the first Contract
Anniversary, and thereafter, the period from one Contract Anniversary to
the next Contract Anniversary.
11. DUE PROOF OF DEATH: A certified copy of the death certificate, Beneficiary
Statement and any additional paperwork necessary to process a death claim.
12. FUND: An investment portfolio of an open-end management investment company
or unit investment trust in which a subaccount invests.
13. INDIVIDUAL RETIREMENT ACCOUNT OR ANNUITY ("IRA"): A retirement arrangement
meeting the requirements of Section 408 of the Internal Revenue Code.
14. NONQUALIFIED CONTRACT. A retirement arrangement plan other than a
qualified plan described under Section 401, 403, 408, 457 or any similar
provisions of the Internal Revenue Code.
15. OWNER: The person or persons entitled to exercise all rights under the
Contract. In this Contract, "you" means Owner.
16. PREMIUMS: The money you pay into this Contract.
17. SEPARATE ACCOUNT: This Contract is funded by a separate account of the
Company. The separate account has multiple subaccounts which invest in
shares or units of an underlying Fund. The separate account and the
subaccounts currently available with this Contract are identified in the
Contract Schedule.
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CONTRACT SCHEDULE
ML LIFE INSURANCE COMPANY OF NEW YORK Contract Number: [J001234567]
Home Office: New York, NY Contract Date: [April 1, 2000]
Annuity Service Center: Issue Date: [April 5, 2000]
P.O. Box 44222 Financial Consultant:
Jacksonville, FL 32231-4222 [XXXXXX X. AGENT]
0-000-000-0000
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OWNER INFORMATION ANNUITANT INFORMATION
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Name: [XXXX X. XXX] Name: [XXXX X. XXX]
Age: [55] Age: [55] Sex: [M]
Co-Owner: [XXXX X. XXX] Co-Annuitant: [XXXX X. XXX]
Age: [55] Age: [55] Sex: [F]
Address: [000 XXX XXXXXX] Annuity Date: [APRIL 1, 2035]
[ANYTOWN, US 01234-0033]
Maximum Owner Age: [90] Maximum Annuitant Age: [90]
Beneficiary: [XXXXXXX X. XXX]
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CONTRACT INFORMATION
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CONTRACT TYPE: FLEXIBLE PREMIUM INDIVIDUAL VARIABLE ANNUITY
ASSET-BASED INSURANCE CHARGE: [1.59% maximum]
CONTRACT FEE: [$40 at the end of each Contract Year (and on full
withdrawal) if the greater of premiums less withdrawls or
Contract Value is less than $25,000.]
TRANSFER CHARGE: We reserve the right to charge [$25] for each transfer
during a Contract Year in excess of [12.]
INITIAL PREMIUM: [$70,000.] For the first 14 days following the Contract Date
all premiums will be allocated to the [Domestic Money Market
Subaccount.]
MINIMUM ADDITIONAL PREMIUM: [$100]
SEPARATE ACCOUNT: [ML of New York Variable Annuity Separate Account A] (The
"Separate Account")
SUBACCOUNTS AND ALLOCATION AFTER 14 DAYS FOLLOWING THE CONTRACT DATE:
[50% ML Basic Value Focus] [ % Xxxxx Value]
[25% ML Domestic Money Mkt] [ % Delaware Trend]
[ % ML Fundmtl Grwth Focus] [ % H&W International VIP]
[ % ML Government Bond] [ % MFS Emerging Growth]
[25% ML Index 500] [ % MFS Growth With Income]
[ % AIM VI Int'l Equity] [ % PIMCO Total Return Bond]
[ % AIM VI Value] [ % Xxxxxxxx Small Cap Value]
[ % Alliance Growth & Income] [ % Xxx Xxxxxx Emerging Growth]
[ % Alliance Premier Growth] 100% TOTAL
MAXIMUM NUMBER OF SUBACCOUNTS: [10]
MINIMUM TRANSFER AMOUNT: [$100]
MAXIMUM NUMBER OF WITHDRAWLS DURING CONTRACT YEAR: [6]
MINIMUM WITHDRAWAL AMOUNT: [$100]
MINIMUM REMAINING CONTRACT VALUE AFTER WITHDRAWAL: [$5,000]
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1. GENERAL PROVISIONS
1.1 BENEFICIARY: The beneficiary is shown in the Contract Schedule. You may
change the beneficiary while you are alive.
You may name a beneficiary irrevocably. If you do so, you can later
change the beneficiary only with the beneficiary's written consent.
If a beneficiary does not survive you, the estate or heirs of such
beneficiary have no rights under this Contract. However, if a beneficiary
survives you but dies before the Contract Value is distributed, the
estate or heirs of such beneficiary are entitled to the death benefit
that would otherwise have been paid to such beneficiary. If no
beneficiary survives you, payment of the death benefit will be made to
your estate.
1.2 OWNERSHIP OF CONTRACT: Unless another Owner is named by the purchaser,
the purchaser is the Owner. Upon notice to us you may assign the
Contract to a new Owner. The assignment terminates all prior beneficiary
designations. When the Contract is issued or the Owner is changed, the
maximum age of the Owner (or older co-owner, if applicable) must be less
than the Maximum Owner Age shown in the Contract Schedule.
Ownership rights must be exercised by the co-owners jointly. Co-owners
are deemed to be joint tenants with right of survivorship unless they
indicate otherwise.
1.3 ANNUITANT: When an annuity option is elected, the amount payable as of
the Annuity Date is based on the age (and sex, where permissible) of the
Annuitant, the annuity option selected, and the Contract Value.
The Annuitant may be changed at any time prior to the Annuity Date. A
change of Annuitant by a non-natural owner will be treated as the death
of an Owner (see Section 7.1). When the Contract is issued or a new
Annuitant is named, the maximum age of the Annuitant (or the older
co-annuitant, if applicable) must be less than the Maximum Annuitant Age
shown in the Contract Schedule.
1.4 NOTICES, CHANGES AND CHOICES: To be effective, all notices, changes and
choices you may make under this Contract must be in writing, signed and
received by us at our Service Center, except that transfers and premium
allocations may be made by telephone by you or your representative if
authorized by you in writing. If acceptable to us, notices, changes, and
choices relating to beneficiaries, ownership, Annuitants, and Annuity
Date will take effect as of the date signed unless we have already acted
in reliance on the prior status. We are not responsible for their
validity.
1.5 RESTRICTIONS ON IRAS: If this Contract is issued as or as part of an IRA,
it may not be assigned, pledged, or transferred unless permitted by law.
1.6 MISSTATEMENT OF AGE OR SEX: If the age of the Owner (or co-owner, if
applicable) is misstated, any death benefit payable under this Contract
will be adjusted to reflect the correct age.
If the age or sex of the Annuitant (or co-annuitant, if applicable)
is misstated, annuity payments will be adjusted to reflect the
correct age and sex. Any amount we have overpaid as the result of
such misstatement will be deducted from the next payments made by us
under this Contract. Interest on the overpayment will be charged at
the rate of 6% per year. Any amount we have underpaid will be paid in
full with the next payment made by us under this Contract. We will
pay interest on the underpayment at the rate of 6% per year.
1.7 PROOF OF AGE, SEX, OR SURVIVAL: We may require satisfactory proof of age,
sex, or survival of any person on whose continued life any payment under
this Contract depends.
1.8 INCONTESTABILITY: We will not contest this Contract.
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1.9 THE CONTRACT: This Contract, any applications, and any endorsements or
riders are the entire Contract. It is issued in consideration of the
payment of the Initial Premium.
Only our President, a Vice President, Secretary, or Assistant
Secretary may change the Contract. Any change must be in writing.
At any time we may make such changes in this Contract as are required
to make it conform with any law, regulation, or ruling issued by a
government agency,
1.10 NONPARTICIPATING: This Contract is nonparticipating. It does not share in
our surplus.
1.11 DATES: Contract Years and anniversaries are measured from the Contract
Date.
1.12 CONTRACT PAYMENTS: All sums payable to or by us are payable at our
Service Center. We may require return of this Contract prior to making
payment. Paid-up annuity benefits, Contract withdrawal values and death
benefits will not be less than the minimum required by the laws of the
state in which the Contract is delivered.
1.13 PROTECTION OF PROCEEDS: Payments under this Contract may not be assigned
by the payee prior to their due dates. To the extent allowed by law,
payments are not subject to legal process for debts of a payee.
1.14 PERIODIC REPORTS: At least once a year prior to the Annuity Date we will
furnish you with a report for your Contract. It will show the current
number of Accumulation Units, the value per Accumulation Unit and the
Contract Value.
1.15 PAYMENTS UNDER THE CONTRACT: Payment generally will be made within seven
days of our receipt of a completed request, but we may defer payment if:
(a) The New York Stock Exchange is closed;
(b) Trading on the New York Stock Exchange is restricted;
(c) An emergency exists such that it is not reasonably practical to
dispose of securities in the Separate Account or to determine the
value of its assets;
(d) The Securities and Exchange Commission by order so permits for the
protection of security holders; or
(e) Payment is derived from a check used to pay a Premium which has not
cleared through the banking system.
Conditions (b), (c) and (d) will be decided by or in accordance with
rules of the Securities and Exchange Commission. Transfers also may be
deferred upon the occurrence of any of the events described above.
1.16 TAX QUALIFICATION: This Contract is intended to qualify as an annuity
contract for federal income tax purposes. To that end, the provisions of
this Contract are to be interpreted to ensure or maintain such tax
qualification, notwithstanding any other provision to the contrary.
Distributions under this Contract shall be made in a time and manner
necessary to maintain such qualification under the applicable provisions
of the Internal Revenue Code including, in the case of an owner who is a
non-natural person, the requirement to distribute the entire interest
in the Contract upon any change of the Annuitant. For this purpose, the
entire interest in the Contract is the Contract Value less any Contract
Fee under Section 4.1. We reserve the right to amend this Contract to
reflect any clarifications that may be needed or are appropriate to
maintain such qualification or to conform this Contract to any applicable
changes in the tax qualification requirements.
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2. PREMIUMS
2.1 ADDITIONAL PREMIUMS: The Minimum Additional Premium is shown on the
Contract Schedule. Premiums may be paid at any time prior to the Annuity
Date without prior notice to us. We will restrict your right to make
additional premium payments as required by law.
2.2 PREMIUM ALLOCATION: Your Premiums will be allocated to the subaccounts of
the Separate Account as you direct, as shown in the Contract Schedule.
However, for the first 14 days following the Contract Date, all Premiums
will be allocated to the subaccount shown under Initial Premium in the
Contract Schedule. If you do not give us allocation instructions with
subsequent Premiums, we will allocate those Premiums according to the
allocation instructions last received from you.
3. THE SEPARATE ACCOUNT
3.1 THE SEPARATE ACCOUNT: The Separate Account is identified in the Contract
Schedule. It is a separate investment account of ML Life Insurance
Company of New York. With respect to the Separate Account, income, gains,
and losses, whether or not realized, from assets allocated to the
Separate Account are credited to or charged against the Separate Account
without regard to other income, gains, or losses of the Company. Assets
allocated to the Separate Account remain our property but are separate
from our general account and any other separate accounts we may have.
Separate Account assets, to the extent equal to the Separate Account's
reserves and other liabilities, may not be charged with liabilities from
any other business we conduct. We reserve the right to transfer any
excess to our general account.
3.2 SUBACCOUNTS: Current subaccounts are shown in the Contract Schedule. We
reserve the right to limit the number of subaccounts in which you may
invest to the number shown in the Contract Schedule.
3.3 CHANGES TO THE SEPARATE ACCOUNT: We may make additional subaccounts
available. We reserve the right, subject to obtaining any necessary
regulatory approvals, to eliminate subaccounts; to substitute a new
portfolio for the portfolio in which a subaccount invests; to deregister
the Separate Account under the Investment Company Act of 1940 (the "1940
Act"); to make any changes required by the 1940 Act; to operate the
Separate Account as a managed investment company under the 1940 Act or
any other form permitted by law; to transfer all or a portion of the
assets of a subaccount or Separate Account to another subaccount or
Separate Account pursuant to a combination or otherwise; and to create a
new Separate Account.
3.4 NUMBER OF ACCUMULATION UNITS: For each subaccount the number of your
Accumulation Units is the sum of:
Each Premium or transfer allocated to the subaccount
Divided by
The value of an Accumulation Unit for that subaccount for the
valuation period in which we received the Premium or transfer.
The number will be adjusted for transfers from each subaccount,
withdrawals and charges. Adjustments will be made as of the valuation
period in which the transaction is effective.
3.5 VALUE OF EACH ACCUMULATION UNIT: For each subaccount, the value of an
Accumulation Unit was arbitrarily set at $10 when the subaccount was
established. The value may increase or decrease from one valuation period
to the next. For any valuation period the value is:
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The value of an Accumulation Unit for the last prior
valuation period
Multiplied by
The Net Investment Factor for that subaccount for the current
valuation period.
3.6 NET INVESTMENT FACTOR: This is an index used to measure the investment
performance of a subaccount from one valuation period to the next. For
any subaccount, we determine the Net Investment Factor by dividing the
value of the assets of the subaccount for that valuation period by the
value of the assets of the subaccount for the preceding valuation period.
We subtract from that result the daily equivalent of the asset-based
insurance charge for the valuation period. We also take reinvestment of
dividends and capital gains into account when we determine the Net
Investment Factor.
We may adjust the Net Investment Factor to make provision for any
change in tax law that requires us to pay tax on earnings in the
Separate Account and any charge that may be assessed against the
Separate Account for assessments or federal premium taxes or federal,
state or local excise, profits or income taxes measured by or
attributable to the receipt of Premiums.
3.7 VALUATION PERIOD: This is the interval from one determination of the net
asset value of a subaccount to the next. Net asset values are determined
as of the close of business on each day the New York Stock Exchange is
open.
4. CHARGES AND DEDUCTIONS
4.1 CONTRACT FEE: A Contract Fee may be deducted from the Contract Value on
each Contract Anniversary that occurs on or prior to the Annuity Date. It
may also be deducted upon a full withdrawal of the Contract Value if it
is not withdrawn on a Contract Anniversary. The amount of the Contract
Fee and circumstances under which it will be imposed are shown in the
Contract Schedule. This charge will never increase.
4.2 ASSET-BASED INSURANCE CHARGE: This charge is made to compensate us for
our expenses for administration of the Separate Account, for issue and
administration of the Contract, for providing a guaranteed minimum death
benefit, and our risks. The maximum charge equals, on an annual basis,
the percentage shown in the Contract Schedule. The asset-based insurance
charge is deducted daily from the net asset value of the subaccounts.
4.3 TAXES, FEES AND ASSESSMENTS: Any charges made by us attributable to
premium taxes imposed by a state or other government will be deducted at
the Annuity Date, except in those jurisdictions that do not allow us to
reduce our current taxable premium income by the amount of any
withdrawal or death benefit. In those jurisdictions, we will also deduct
a charge for those taxes on any withdrawal or death benefit paid
under the Contract. We may also deduct a charge for assessments or
federal premium taxes or federal, state, or local excise, profits, or
income taxes measured by or attributable to the receipt of Premiums.
We also reserve the right to deduct from the Separate Account any
taxes imposed on the Separate Account.
4.4 PAYMENT OF DEDUCTIONS: The asset-based insurance charge will be computed
and deducted from each subaccount for each day the Contract is in force.
The transfer charge described in Section 5.1 will be deducted pro rata
from the subaccounts from which Contract Value is being transferred.
Other applicable charges will be deducted from each subaccount of the
Separate Account in the ratio of your interest in each subaccount to your
Contract Value.
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5. TRANSFERS
5.1 TRANSFERS AMONG SUBACCOUNTS: You may transfer all or part of your
Contract Value among the subaccounts. The number of transfers allowed
each contract year without charge is shown in the Contract Schedule.
We reserve the right to charge for each additional transfer as shown
in the Contract Schedule. The minimum amount which may be transferred
from any subaccount in any transaction is shown in the Contract
Schedule.
An excessive number of transfers, including short-term "market timing"
transfers, may adversely affect the performance of the underlying
portfolio in which a subaccount invests. If, in our sole opinion, a
pattern of an excessive number of transfers develops for a Contract, we
reserve the right not to process a transfer request. We also reserve the
right not to process a transfer request when the sale or purchase of
shares or units of an underlying portfolio is not reasonably practicable
due to actions taken or limitations imposed by the underlying fund
5.2 DOLLAR COST AVERAGING PROGRAM: You may transfer all or part of your
Contract Value in a designated subaccount to one or more other
subaccounts pursuant to the Dollar Cost Averaging Program (DCA Program).
We will transfer a specified amount each month from the subaccount that
you designate and allocate it in accordance with your instructions to the
subaccount(s) that you select. To elect the DCA Program you need to have
a minimum amount in the designated subaccount equal to the amount to be
transferred each month multiplied by the number of monthly transfers.
5.3 ASSET ALLOCATION PROGRAM: You may choose to have your premiums and
Contract Value allocated among the subaccounts in accordance with the
Asset Allocation Model you select based on your investment goals and risk
tolerance. Each Model identifies specific subaccounts and the percentage
of premium or Contract Value which should be allocated to each of these
subaccounts. At the end of each calendar quarter we will automatically
reallocate your Contract Value to maintain the subaccounts and
percentages then in effect for your selected Model.
5.4 REBALANCING PROGRAM: You may choose the Rebalancing Program where you
select the percentage of premium and Contract Value to be allocated to
subaccounts you select based on your investment goals and risk tolerance.
We will allocate your premiums or Contract Value to these subaccounts in
accordance with the percentages you select. At the end of each calendar
quarter we will automatically reallocate your Contract Value to maintain
the particular percentage allocation among the subaccounts you have
selected.
6. WITHDRAWALS
6.1 WITHDRAWALS: You may withdraw all or part of your Contract Value. Notice
must be received by us prior to the Annuity Date. The maximum number of
withdrawals permitted each contract year is shown in the Contract
Schedule. The minimum amount of each withdrawal, and the Contract Value
that must be remaining after a withdrawal, are shown in the Contract
Schedule. For a full withdrawal this contract must be surrendered to our
Service Center.
6.2 SYSTEMATIC WITHDRAWAL PROGRAM: You may have automatic withdrawals of a
specified dollar amount made periodically. We will make these
withdrawals from the subaccounts in the same proportion as the value of
each subbaccount bears to the Contract Value. These systematic
withdrawals are in addition to the withdrawals permitted annually under
the Contract. The minimum amount of each withdrawal and the remaining
Contract Value after a withdrawal is shown in the Contract Schedule. The
Systematic Withdrawal Program cannot extend beyond the Annuity Date.
6.3 PAYMENT OF WITHDRAWALS: Unless you notify us otherwise, partial
withdrawals will be deducted from each subaccount in the ratio of your
Contract Value in each subaccount to the
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Contract Value. Withdrawals will be based on Values for the valuation
period in which the notice (and Contract if required) is received at our
Service Center.
6.4 EFFECT OF WITHDRAWALS ON DEATH BENEFIT: Withdrawals will reduce on a
proportional basis the amount payable to a beneficiary if the owner dies
prior to the Annuity Date. See Section 7.1.1.
7. PAYMENT AT DEATH
7.1 DEATH OF OWNER
(including an Annuitant who is also an Owner)
7.1.1 DEATH PRIOR TO ANNUITY DATE: If an Owner dies prior to the Annuity
Date, we will pay the beneficiary the death benefit specified below, in a
lump sum, or if requested, under an annuity option under Section 7.1.4.
If the Owner is a non-natural person, then the Annuitant, rather than the
Owner will be used to determine the death benefit. The death benefit is
determined as of the date we receive due proof of the Owner's death at
our Service Center.
(a) If the Owner is age 80 or over on the Contract Date, the death
benefit is the greater of:
(i) the premiums paid into the Contract less "adjusted"
withdrawals from the Contract; or
(ii) the Contract Value.
Each "adjusted" withdrawal equals the amount withdrawn multiplied by
(i) divided by (ii) (both determined immediately prior to the
withdrawal).
(b) If the Owner is under age 80 on the Contract Date, the death benefit
is the greatest of:
(i) the premiums paid into the Contract less "adjusted" withdrawals
from the Contract;
(ii) the Contract Value; or
(iii) the Maximum Anniversary Value.
Each "adjusted" withdrawal equals the amount withdrawn multiplied by
the greater of (i) and (iii) divided by (ii) (all of which are
determined immediately prior to the withdrawal).
The following is an explantion and example of the effect of a withdrawal
on the death benefit. For purposes of this example, (a)(i) of this
section and the greater of (b)(i) and (b)(iii) of this section are
referred to as the Guaranteed Minimum Death Benefit (GMDB).
The adjustment to a withdrawal causes the GMDB to be reduced in the same
proportion that the withdrawal reduces the Contract Value. For example:
Assume that the GMDB and Contract Value immediately prior to a withdrawal
are $50,000 and $100,000, respectively. If a $10,000 withdrawal is taken
from the Contract, the "adjusted" withdrawal would equal the amount
withdrawn, multiplied by the GMDB divided by the Contract Value ($10,000
x $50,000/$100,000 = $5,000). Since a $10,000 withdrawal reduces the
Contract Value by 10% ($10,000/$100,000) the GMDB is also reduced by
10% or $5,000 (10% x $50,000).
7.1.2 MAXIMUM ANNIVERSARY VALUE: The Maximum Anniversary Value is equal to the
greatest anniversary value for the Contract. An anniversary value is
equal to the Contract Value on a Contract Anniversary increased by
premium payments and decreased by "adjusted" withdrawals, as defined in
Section 7.1.1(b), since that anniversary.
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To determine the Maximum Anniversary Value, we will calculate an
anniversary value for each Contract Anniversary through the earlier of
your attained age 80 or the anniversary on or prior to your date of
death. If the Contract has co-owners, we will calculate the anniversary
value through the earlier of the older Owner's attained age 80 or the
anniversary on or prior to any Owner's date of death if a death
benefit is payable.
We will calculate the Maximum Anniversary Value based on your age (or
the age of the older Owner, if the Contract has co-owners) on the
Contract Date. Subsequent changes in Owner will not increase the period
of time used to determine the Maximum Anniversary Value. If a new Owner
has not reached attained age 80 and is older than the Owner whose age is
being used to determine the Maximum Anniversary Value at the time of the
ownership change, the period of time used in the calculation of the
Maximum Anniversary Value will be based on the age of the new Owner at
the time of the ownership change. If at the time of an ownership change
the new Owner is attained age 80 or over, we will use the Maximum
Anniversary Value as of the anniversary on or prior to the ownership
change, increased by premium payments and decreased by "adjusted"
withdrawals, as defined in Section 7.1.1(b), since that anniversary.
If we have not received the beneficiary's instructions for making payment
within 60 days following our receipt of the Owner's certified
death certificate, due proof of death will be deemed to have been
received by us on the 60th day, and payment will be made in a lump sum.
7.1.3 CONTRACT CONTINUATION OPTION: If the surviving spouse of the deceased
Owner is the beneficiary, such spouse may choose to continue this
Contract. The spouse shall become the "new" owner and the beneficiary
until a new beneficiary is named. If the death benefit which would
have been paid to the surviving spouse is greater than the Contract
Value as of the date we determine the death benefit, we will increase the
Contract Value of the continued Contract to equal the death benefit we
would have paid to the surviving spouse. Your interest in each subaccount
will be increased by the ratio of your Contract Value in each subaccount
to your Contract Value.
7.1.4 ANNUITY OPTION: If the beneficiary is the surviving spouse of the
deceased Owner, he or she may choose to receive payments under any of the
annuity options of this Contract. For any other beneficiary, only those
options are available that provide for full payment of such Owner's
interest in the Contract:
(a) Within five years of the date of such Owner's death;
(b) Over the lifetime of such beneficiary of this Contract; or
(c) Over a period that does not exceed the life expectancy, as defined by
Internal Revenue Service regulations, of such beneficiary of this
Contract.
Subparagraphs (b) and (c) apply only to individuals, and such payments
must start within one year of the date of such Owner's death. For IRAs,
any annuity option chosen must meet the requirements of the Internal
Revenue Code.
7.1.5 DEATH AFTER ANNUITY DATE: See Section 9.
7.2 DEATH OF ANNUITANT WHO IS NOT AN OWNER
7.2.1 If the Annuitant dies prior to the Annuity Date and the Annuitant is not
the Owner, the Owner, provided the Owner is a natural person, may
designate a new Annuitant. If one is not designated, the Owner will
become the Annuitant. If the Owner is a non-natural person, the death
of the Annuitant shall be treated as the death of the Owner.
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8. ANNUITY PROVISIONS
8.1 ANNUITY DATE: The Annuity Date may not be later than the date the
Annuitant would reach the Maximum Annuitant Age shown in the Contract
Schedule. If you have not chosen an Annuity Date, it will be the date
the Annuitant would reach the Maximum Annuitant Age shown in the Contract
Schedule. For an IRA, if you have not chosen an Annuity Date, it will be
the date the Annuitant reaches age 70 1/2. You may change the Annuity
Date prior to the Annuity Date.
8.2 AMOUNT OF ANNUITY PAYMENTS: Charges made by us for premium taxes will be
deducted from your Contract Value at the Annuity Date. The remaining
value will be transferred to our general account and applied to the
annuity option you selected, at our then current annuity purchase rates,
which will be furnished on request. The annuity purchase rates will
assume interest of not less than 3%. They will not be less favorable than
those shown in the annuity tables in this Contract. The tables show the
minimum guaranteed amount of each monthly payment for each $1,000 so
applied, according to the sex (where permissible) and age at the Annuity
Date of the Annuitant. The tables are based on the 1983 Table "a" for
Individual Annuity Valuation, projected forward to 2000 with interest at
3%.
8.3 ANNUITY OPTIONS: If you have not chosen an annuity option described in
Section 9, Option 4 will apply with a 10-year guarantee period. You may
change options prior to the Annuity Date. An option not set forth in the
Contract may be chosen if acceptable to us.
8.4 MINIMUM ANNUITY PAYMENT: If the Contract Value to be applied at the
Annuity Date is less than $2,000, we may pay such amount in a lump sum.
If any payment would be less than $20, we may change the frequency so
payments are at least $20 each.
9. ANNUITY OPTIONS
9.1 OPTION 1 - PAYMENTS OF A FIXED AMOUNT: Equal payments in the amount
chosen will be made until the amount of your Contract Value transferred
to our general account adjusted for interest credited of at least 3% is
exhausted. The term over which such payments are made must be at least
five years.
9.2 OPTION 2 - PAYMENTS FOR A FIXED PERIOD: Payments will be made for the
period chosen. The period must be at least 5 years.
9.3 OPTION 3 - LIFE ANNUITY: Payments will be made for the life of the
Annuitant. Payments will cease with the last payment due prior to the
Annuitant's death.
9.4 OPTION 4 - LIFE ANNUITY WITH PAYMENTS GUARANTEED FOR 5,10,15 OR 20 YEARS:
Payments will be made for the guaranteed period chosen (5, 10, 15 or 20
years) and as long thereafter as the Annuitant lives.
9.5 OPTION 5 - LIFE ANNUITY WITH GUARANTEED RETURN OF CONTRACT VALUE:
Payments will be made until the sum of the annuity payments equals the
amount of your Contract Value transferred to our general account at the
Annuity Date, and as long thereafter as the Annuitant lives.
9.6 OPTION 6 - JOINT AND SURVIVOR LIFE ANNUITY: Payments will be made during
the lifetimes of the Annuitant and a designated second person. The amount
of such payments will not change by reason of the death of the first
joint Annuitant to die.
9.7 OPTION 7 - JOINT AND SURVIVOR LIFE ANNUITY WITH PAYMENTS GUARANTEED FOR
5, 10, 15 OR 20 YEARS: Payments will be made for the guaranteed period
chosen (5, 10, 15 or 20 years) and as long thereafter as either of the
Annuitants lives.
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9.8 OPTION 8 - IRA: This option is available only for IRAs. Annuity
payments may be based on (a) the life expectancy of the Annuitant, (b)
the joint life expectancy of the Annuitant and his or her spouse, or (c)
the life expectancy of the surviving spouse if the Annuitant dies before
the Annuity Date. Payments will be made annually. Each annual payment
will be equal to the remaining value on that January 1, divided by the
applicable current life expectancy, as defined by Internal Revenue
Service regulations. Each subsequent payment will be made on the
anniversary of the Annuity Date. Interest will be credited at our current
rate for this option. The rate will not be less than 3%. On the death of
the measuring life or lives prior to full distribution of the remaining
value, the remaining value will be paid to the beneficiary in a lump sum.
9.9 DEATH OF ANNUITANT: On the death of the Annuitant while guaranteed
amounts remain unpaid under Option 1, 2, 4, 5 or 7, the Owner may choose
either:
(a) To have payments continue for the amount or period guaranteed; or
(b) To receive the present value of the remaining guaranteed payments in
a lump sum.
If an Owner dies while guaranteed amounts remain unpaid, the present
value may be paid in a lump sum to the beneficiary, if the beneficiary so
elects.
Present values will be computed at the interest rate that was used to
compute the amount of the initial annuity payment.
9.10 PAYMENT: Except for Option 8, monthly payments will be made beginning on
the Annuity Date, but prior to the Annuity Date you may choose a less
frequent payment interval. The amount of each payment on an annual,
semiannual, or quarterly basis will be not less than the monthly payment
computed from the annuity tables in this Contract multiplied by the
appropriate factor.
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10. ANNUITY OPTION TABLES
MINIMUM GUARANTEED MONTHLY ANNUITY PAYMENT FOR EACH $1,000 APPLIED UNDER OPTION
OPTION 2 (PAYMENTS FOR A FIXED PERIOD)
-------------------------------------------------------------------------
Years Each Years Each Years Each Years Each
Payable Payment Payable Payment Payable Payment Payable Payment
-------------------------------------------------------------------------
5 17.91 9 10.53 13 7.71 17 6.23
6 15.14 10 9.61 14 7.26 18 5.96
7 13.16 11 8.86 15 6.87 19 5.73
8 11.68 12 8.24 16 6.53 20 5.51
-------------------------------------------------------------------------
OPTION 3 (LIFE ANNUITY), OPTION 4 (LIFE ANNUITY WITH 10 OR 20 YEARS GUARANTEED)
AND OPTION 5 (RETURN OF CONTRACT VALUE GUARANTEED)
-------------------------------------------------------------------------------------------------------------------------------
*Adjusted Life 10 Years 20 Years Return of *Adjusted Life 10 Years 20 Years Return of
Male Age Annuity Guaranteed Guaranteed Contract Value Female Age Annuity Guaranteed Guaranteed Contract Value
-------------------------------------------------------------------------------------------------------------------------------
56 4.42 4.37 4.20 4.21 56 4.12 4.10 4.01 4.00
57 4.51 4.45 4.27 4.28 57 4.20 4.17 4.07 4.06
58 4.60 4.54 4.33 4.35 58 4.28 4.25 4.13 4.13
59 4.70 4.63 4.39 4.43 59 4.36 4.33 4.19 4.20
60 4.80 4.73 4.46 4.51 60 4.45 4.41 4.26 4.27
61 4.92 4.83 4.52 4.60 61 4.55 4.50 4.33 4.35
62 5.04 4.93 4.59 4.68 62 4.65 4.59 4.40 4.43
63 5.17 5.05 4.65 4.78 63 4.76 4.69 4.47 4.52
64 5.30 5.16 4.72 4.88 64 4.87 4.80 4.54 4.61
65 5.45 5.29 4.78 4.98 65 5.00 4.91 4.61 4.70
66 5.61 5.42 4.85 5.09 66 5.13 5.03 4.68 4.80
67 5.77 5.55 4.91 5.20 67 5.27 5.15 4.76 4.91
68 5.95 5.69 4.97 5.32 68 5.42 5.29 4.83 5.02
69 6.14 5.84 5.03 5.45 69 5.58 5.42 4.90 5.14
70 6.34 5.99 5.08 5.58 70 5.75 5.57 4.97 5.27
71 6.55 6.14 5.13 5.72 71 5.94 5.73 5.03 5.40
72 6.78 6.30 5.18 5.86 72 6.14 5.89 5.09 5.54
73 7.02 6.46 5.23 6.02 73 6.36 6.06 5.15 5.69
74 7.28 6.63 5.27 6.18 74 6.60 6.23 5.21 5.85
75 7.55 6.80 5.31 6.34 75 6.86 6.42 5.25 6.02
76 7.84 6.97 5.34 6.52 76 7.13 6.61 5.30 6.20
77 8.16 7.15 5.37 6.71 77 7.43 6.80 5.34 6.39
78 8.49 7.32 5.40 6.90 78 7.75 7.00 5.37 6.59
79 8.85 7.50 5.42 7.11 79 8.10 7.20 5.40 6.80
80 9.24 7.76 5.44 7.32 80 8.47 7.40 5.43 7.02
81 9.65 7.84 5.46 7.55 81 8.87 7.60 5.45 7.26
82 10.09 8.01 5.47 7.79 82 9.31 7.79 5.47 7.51
83 10.55 8.17 5.49 8.04 83 9.79 7.99 5.48 7.77
84 11.05 8.32 5.49 8.31 84 10.31 8.17 5.49 8.05
85 11.58 8.47 5.50 8.59 85 10.87 8.53 5.50 8.36
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OPTION 6 (JOINT AND SURVIVOR LIFE ANNUITY)
-------------------------------------------------------------------------------------------------------------------------------
*Adjusted *Adjusted Male Age *Adjusted
Female ---------------------------------------------------------------------------------------------------------- Female
Age 50 55 60 65 70 75 80 85 Age
-------------------------------------------------------------------------------------------------------------------------------
50 3.46 3.54 3.60 3.65 3.69 3.71 3.72 3.73 50
55 3.58 3.70 3.80 3.88 3.94 3.98 4.01 4.03 55
60 3.68 3.85 4.00 4.13 4.24 4.32 4.37 4.40 60
65 3.77 3.98 4.20 4.40 4.59 4.73 4.83 4.90 65
70 3.84 4.09 4.38 4.67 4.96 5.21 5.41 5.55 70
75 3.89 4.18 4.52 4.92 5.34 5.74 6.10 6.38 75
80 3.92 4.24 4.63 5.11 5.67 6.26 6.85 7.37 80
85 3.95 4.28 4.71 5.25 5.93 6.72 7.58 8.45 85
-------------------------------------------------------------------------------------------------------------------------------
Information for ages or Annuity Options not shown will be furnished on request.
*"Adjusted Age" is the actual age on the Annuity Dated reduced by one year for
each 10 full years between January 1, 2000 and the Annuity Date. For example:
---------------------------------------------------------
ANNUITY DATE ADJUSTED AGE
---------------------------------------------------------
Before 2010 Actual Age
2010 to 2019 Subtract 1 year from actual age
2020 to 2029 Subtract 2 years from actual age
2030 to 2039 Subtract 3 years from actual age
2040 to 2049 Subtract 4 years from actual age
---------------------------------------------------------
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