Aetna Life Insurance and Annuity Company
ENDORSEMENT
This Contract is hereby endorsed to delete the previous Guaranteed Accumulation
Account (GA Account) Endorsement and replace it with the following:
Add to the GENERAL DEFINITIONS Section of the Contract the following paragraphs:
Maturity Date: The last day of a GA Account Term.
Matured Term Value: The amount payable on a GA Account Term's Maturity
Date.
Nonunitized Separate Account: An account set up by Aetna under Tile 38,
Sec. 38-154a, of the Connecticut General Statutes, which is used to hold
assets for GA Account Terms greater than three years. The Owner or
Participant, as applicable, does not participate in the investment gain
or loss from the assets held in the GA Account.
The Guaranteed Accumulation Account (GA Account) is amended and restated as
follows:
The GA Account guarantees stipulated rates of interest for stated periods
of time (see (1) and (3) below). Amounts withdrawn before the end of a
Guaranteed Term may be subject to a Market Value Adjustment (MVA) (see
(7) below).
(1) Deposit Period - A calendar month, a calendar quarter, or any other
period of time specified by Aetna during which Net Purchase Payment(s)
and transfers are accepted into the GA Account for one or more Guaranteed
Terms.
(2) Guaranteed Term (Term) - The period of time for which interest rates are
guaranteed on Net Purchase Payment(s) and on transfers made into a
Deposit Period of the GA Account. Terms are offered at Aetna's discretion
for various lengths of time ranging up to and including ten years.
(3) Guaranteed Term Classifications - The grouping of Terms according to
their time to maturity. The following are the Classifications:
(a) Short Term: Terms of up to and including 3 years; or
(b) Long Term: Terms of greater than 3 years and up to and including 10
years.
1
During a Deposit Period, Aetna may make available one or more Terms
within a Classification. The Owner has the option to allocate Net
Purchase Payment(s) and transfers into any or all of the available
Deposit Period Terms. If no specific direction is given, Net Purchase
Payment(s) and transfers will go into available Terms on a pro rata basis
within the Classification(s) previously chosen by the Owner. At least one
Term in the Short Term Classification will be available each Deposit
Period.
(4) Guaranteed GA Account Interest Rates (Guaranteed Rates) - Aetna will
declare all interest rate(s) applicable to a specific Term at the start
of the Deposit Period for that Term. These rate(s) are guaranteed by
Aetna for that Deposit Period and the ensuing Term and are not based on
the actual investment experience of the underlying assets in the GA
Account. The Guaranteed Rates are annual effective yields. The interest
is credited daily at a rate that will produce the guaranteed annual
effective yield over the period of a year. No annual rate will ever be
less than 4%.
For Terms of one year or less, one Guaranteed Interest Rate is set and
announced for that full Term. For other Terms, there may be two or more
rates. The rate(s) will be set and announced prior to the Deposit Period
for that Term and will not be subject to change.
(5) Withdrawals from GA Account - Full or partial surrenders may be requested
at any time from the GA Account. However, amounts withdrawn prior to the
Maturity Date of a Term to satisfy a surrender request may be subject to
an MVA (see (7) below).
Full and partial surrenders are satisfied by withdrawing amounts from
each of the Fund(s), the Fixed Account, the GA Account Short Term
Classification and the GA Account Long Term Classification on a pro rata
basis. However, the Owner or Participant, as applicable, may specify a
particular order in which investment options will be liquidated in order
to satisfy a partial surrender request.
For purposes of withdrawals, Terms within the GA Account Short Term and
Long Term Classifications are considered as two separate investment
options. Any withdrawal which is a surrender will be subject to the
Maintenance Fee and Surrender Fee as appropriate. Also, amounts will be
removed within a GA Account Classification starting with the Term still
in effect with the oldest Deposit Period.
Amounts may be transferred at any time subject to Contract specifications
(see (9) below). Amounts transferred prior to the Maturity Date of a Term
are subject to an MVA (see (7) below). Fund(s) will be removed within the
elected Classification starting with the Term still in effect with the
oldest Deposit Period.
2
During the Deposit Period and the 90 days following the close of the
Deposit Period, any amounts applied to the GA Account during that Deposit
Period may not be withdrawn unless due to:
(a) A full or partial surrender;
(b) A payment of a premium for an Annuity Option; or
(c) The Sum Payable at Death provision.
(6) Maturity Date/Reinvestment - For all GA Account Term(s) existing as of
the effective date of this endorsement in addition to GA Account Term(s)
announced subsequent to that date, the Owner or Participant, as
applicable, will be mailed a notice at least 18 calendar days before a
Term's Maturity Date. This notice will contain the current Deposit
Period's Guaranteed Rate(s), Term(s) and a projected Matured Term Value.
The Matured Term Value may be surrendered or transferred on the Term's
Maturity Date without an MVA. If no specific direction is given by the
Owner or Participant, as applicable, prior to the Maturity Date, each
Matured Term Value will be reinvested in a Term of the same duration. In
the event that a Term of the same duration is unavailable, each Matured
Term Value will automatically be reinvested in the next shortest Term
available in the same Classification during the then current Deposit
Period. If however, only one Term is available within the Classification,
then the Matured Term Value will automatically be reinvested in that
Term. Within two business days after the Maturity Date, the Owner or
Participant, as applicable, will be mailed a confirmation statement. This
statement will state the Terms and Guaranteed Rates which will apply to
the reinvested Matured Term Value.
During the calendar month following the Term's Maturity Date, one
exception is allowed to the 90 day transfer restriction and MVA under (5)
and (7). This exception is applicable to each Matured Term Value plus any
interest accrued thereon, provided no part of the Matured Term Value was
transferred on the Maturity Date.
During this calendar month period, the Owner or Participant, as
applicable, may notify Aetna's Home Office to transfer or surrender all
or part of the Matured Term Value plus any interest accrued thereon from
the GA Account without an MVA. This provision only applies to the first
such request received from the Owner or Participant, as applicable,
during this period for any Matured Term Value. The Matured Term Value
plus any interest accrued thereon may be transferred upon such request
without an MVA:
3
(a) To any other Terms of the GA Account available in the current
Deposit Period; or
(b) To any other allowable Fund(s).
If no such notification is given, the Matured Term Value will remain
subject to the terms and conditions of the new Term. All surrender and
transfer requests will be processed as of the date they are received in
good order at Aetna's Home Office.
If this Contract is issued under a Tax Deferred Annuity Plan (see
Specifications page) the above notice will be sent to the Participant(s).
(7) Market Value Adjustment (MVA) - There will be an MVA for a withdrawal
from the GA Account before the end of a Term when the withdrawal is due
to:
(a) A transfer;
(b) A full or partial surrender; or
(c) A payment of a premium for Annuity Option 2.
The amount of the withdrawal will be adjusted to a market value amount as
described below.
The market value adjusted amount will be equal to the amount withdrawn
multiplied by the following ratio:
x
---
365
(1+i)
-----
x
---
365
(1+j)
Where: i is the Deposit Yield
j is the Current Yield
x is the number of days remaining, (computed from Wednesday of the
week of withdrawal) in the Guaranteed Term.
The Deposit Period Yield will be determined as follows:
(bullet) At the close of the last business day of each week of the Deposit
Period, a yield will be computed as the average of the yields on
that day of U.S. Treasury Notes which mature in the last three
months of the Guaranteed Term.
4
(bullet) The Deposit Period Yield is the average of those yields for the
Deposit Period. If withdrawal is made prior to the close of the
Deposit Period, it is the average of those yields on each week
preceding withdrawal.
The Current yield is the average of the yields on the last business day of the
week preceding withdrawal on the same U.S. Treasury Notes included in the
Deposit Period Yield.
In the event that no U.S. Treasury Notes which mature in the last three months
of the Guaranteed Term exist, Aetna reserves the right to use the U.S. Treasury
Notes that mature in a following quarter.
Full and partial surrenders as well as transfers made within six months of the
date of death of the Participant under the Sum Payable at Death provision will
be the greater of:
(bullet) The aggregate MVA amount which is the sum of all market value
adjusted amounts calculated due to a withdrawal of amounts (for
surrender or transfer) from Terms prior to the end of those Terms.
The aggregate MVA may be either positive or negative; or
(bullet) The applicable portion of the Current Value in the GA Account.
After the six month period, the surrender or transfer will be the aggregate MVA
amount (i.e. including all MVAs).
The greater of the aggregate MVA amount or the applicable portion of the Current
Value in the GA Account is applied to amounts withdrawn from the GA Account for
payment of a premium under Annuity Options 3 or 4.
Aetna may make any change to this provision with 30 days advance written notice
to the Owner or Participant, as applicable. Any such change shall become
effective for Purchase Payment(s), transfers or reinvestments made to any new
Term by any present or future Participant.
(8) Deposits to the GA Account - All amounts in the GA Account under the
Short Term Classification are made to the General Account.
All amounts in the GA Account under the Long Term Classifications are
made to a Nonunitized Separate Account. There are no discrete units for
this Nonunitized Separate Account. The Owner or Participant, as
applicable, does not participate in the gain or loss from the assets held
in the Nonunitized Separate Account. Such gain or loss is borne entirely
by Aetna. These assets may be chargeable with liabilities arising out of
any other business of Aetna.
5
For Terms under both the Short Term and Long Term Classifications, Aetna
guarantees stipulated interest rates to be credited to the GA Account.
All assets of Aetna including amounts made to the GA Account are
available to meet the guarantees under the GA Account.
(9) Before an Annuity Option is elected, all or any portion of the Current
Value may be transferred from any Fund or GA Account:
(a) To any other allowable Fund;
(b) To the Fixed Account; or
(c) To Terms of the GA Account available in the current Deposit Period.
Amounts in a specific GA Account Term cannot be transferred to the
Deposit Period of another Term within the same Classification except at
the Term's maturity (see (6)).
Amounts applied to Classifications of the GA Account may not be
transferred to the Fund(s) or to the Fixed Account during the Deposit
Period or for 90 days after the close of the Deposit Period.
Transfers from Terms of the GA Account are subject to the Withdrawal and
MVA provisions (see (5) and (7)).
Twelve transfers of Current Value can be made during a calendar year
period. The Transfer of any portion of the GA Account value at the
Maturity Date of a Term is not counted for this purpose. Aetna may allow
additional transfers, but each may be subject to a fee of up to $10.
Endorsed and made a part of this Contract on May 1, 1991 or the effective date
of the Contract whichever is later.
/s/ Xxxx X. Xxxxxx
President
Aetna Life Insurance and Annuity Company
6