PARKSTONE VARIABLE ANNUITY
FLEXIBLE PREMIUM DEFERRED VARIABLE ANNUITY CONTRACT
THE COMPANY'S PROMISE
In consideration of the Purchase Payments and the attached application, Security
Benefit Life Insurance Company (the "Company") will pay the benefits of this
Contract according to its provisions,
LEGAL CONTRACT
PLEASE READ YOUR CONTRACT CAREFULLY. It is a legal Contract between the owner
and the Company. The Contract's table of contents is on page 2.
FREE LOOK PERIOD-RIGHT TO CANCEL
IF FOR ANY REASON THE OWNER IS NOT SATISFIED WITH THIS CONTRACT, THE OWNER MAY
RETURN IT TO THE COMPANY WITHIN 10 DAYS FROM THE DATE OF RECEIPT. IT MAY BE
RETURNED BY DELIVERING OR MAILING IT TO THE COMPANY. IF RETURNED, THIS CONTRACT
SHALL BE DEEMED VOID FROM THE CONTRACT DATE. THE COMPANY WILL REFUND ANY
PURCHASE PAYMENTS MADE AND ALLOCATED TO THE FIXED ACCOUNT AND WILL REFUND
SEPARATE ACCOUNT CONTRACT VALUE AS OF THE DATE THE RETURNED POLICY IS RECEIVED
BY THE COMPANY.
SIGNED FOR THE SECURITY BENEFIT LIFE INSURANCE COMPANY ON THE CONTRACT DATE.
XXXXX X. XXXXX XXXXXX X. XXXXXX
Secretary President
A BRIEF DESCRIPTION OF THIS CONTRACT
This is a FLEXIBLE PREMIUM DEFERRED VARIABLE ANNUITY CONTRACT
*Purchase Payments may be made until the earlier of the Annuity Start Date or
termination of the Contract.
*A Death Benefit may be paid prior to the Annuity Start Date according to the
Contract provisions.
*Annuity Payments begin on the Annuity Start Date using the method specified in
this Contract.
*This Contract is Participating.
ALL PAYMENTS AND VALUES PROVIDED BY THIS CONTRACT, WHEN BASED ON THE INVESTMENT
EXPERIENCE OF THE SEPARATE ACCOUNT, ARE VARIABLE AND MAY INCREASE OR DECREASE IN
ACCORDANCE WITH THE INVESTMENT EXPERIENCE OF THE SEPARATE ACCOUNT. THERE ARE NO
GUARANTEED MINIMUM PAYMENTS OR CASH VALUES. (SEE "CONTRACT VALUE AND EXPENSE
PROVISIONS" AND "ANNUITY PAYMENT PROVISIONS" FOR DETAILS.)
[SBG LOGO]
SECURITY BENEFIT LIFE INSURANCE COMPANY
A MEMBER OF THE SECURITY BENEFIT GROUP OF COMPANIES
000 XX XXXXXXXX XXXXXX, XXXXXX, XX 00000-0001
0-000-000-0000
TABLE OF CONTENTS
PAGE
CONTRACT SPECIFICATIONS 3
DEFINITIONS 4
GENERAL PROVISIONS 7
THE CONTRACT 7
COMPLIANCE 7
MISSTATEMENT OF AGE 7
EVIDENCE OF SURVIVAL 7
INCONTESTABILITY 7
ASSIGNMENT 7
TRANSFERS 8
CLAIMS OF CREDITORS 8
NONFORFEITURE VALUES 8
PARTICIPATION 9
STATEMENTS 9
OWNERSHIP, ANNUITANT AND BENEFICIARY PROVISIONS 9
OWNERSHIP 9
JOINT OWNERSHIP 9
ANNUITANT 9
PRIMARY AND CONTINGENT BENEFICIARIES 9
OWNERSHIP AND BENEFICIARY CHANGES 9
PURCHASE PAYMENT PROVISIONS 10
FLEXIBLE PURCHASE PAYMENTS 10
PURCHASE PAYMENT LIMITATIONS 10
PURCHASE PAYMENT ALLOCATION 00
XXXXX XX XXXXXXX 00
CONTRACT VALUE AND EXPENSE PROVISIONS 10
CONTRACT VALUE 10
FIXED ACCOUNT CONTRACT VALUE 10
FIXED ACCOUNT INTEREST CREDITING 11
SEPARATE ACCOUNT CONTRACT VALUE 11
ACCUMULATION UNIT VALUE 11
NET INVESTMENT FACTOR 11
DETERMINING ACCUMULATION UNITS 12
MORTALITY AND EXPENSE RISK CHARGE 12
PREMIUM TAX EXPENSE 12
ADMINISTRATION CHARGE 12
MUTUAL FUND EXPENSES 12
WITHDRAWAL PROVISIONS 12
WITHDRAWALS 12, 13
WITHDRAWAL VALUE 13
WITHDRAWAL CHARGES 13
FREE WITHDRAWALS 13
SYSTEMATIC WITHDRAWALS 14
FREE SYSTEMATIC WITHDRAWALS 14
DISABILITY WAIVER 14
DATE OF REQUEST 14
PAYMENT OF WITHDRAWAL BENEFITS 14, 15
DEATH BENEFIT PROVISIONS 15
DEATH BENEFIT 15
PROOF OF DEATH 16
DISTRIBUTION RULES 16
ANNUITY PAYMENT PROVISIONS 16
ANNUITY START DATE 16, 17
CHANGE OF ANNUITY START DATE 17
ANNUITY START AMOUNT 17
WITHDRAWAL CHARGES 17
ANNUITY TABLES 17
ANNUITY PAYMENTS 17
CHANGE OF ANNUITY OPTION 18
FIXED ANNUITY PAYMENTS 18
VARIABLE ANNUITY PAYMENTS 18
ANNUITY UNITS 18
NET INVESTMENT FACTOR 18, 19
ALTERNATE ANNUITY OPTION RATES 19
ANNUITY OPTIONS 19, 20
ANNUITY TABLES 21, 22
AMENDMENTS OR ENDORSEMENTS, IF ANY
DEFINITIONS
SEPARATE ACCOUNT
Income and realized and unrealized gains and losses from assets in the Separate
Account are credited to, or charged against, the Separate account without regard
to the income, gains or losses from the Company's general account or its other
separate account. The Separate Account is divided into Subaccounts shown on page
3. Income and realized and unrealized gains and losses from assets in each
Subaccount are credited to, or charged against, the Subaccount without regard to
income, gains or losses in the other Subaccounts. The Company has the right to
transfer to its general account any assets of the Separate Account that are in
excess of the reserves and other Contract liabilities with respect to the
Separate Account. The value of the assets in the Separate Account on each
Valuation Date is determined as of the end of each Valuation Date.
SUBACCOUNT NET ASSET VALUE
The Subaccount Net Asset Value is equal to: (1) the net asset value of all
shares of the underlying mutual fund held by the Subaccount; plus (2) any cash
or other assets; less (3) all liabilities of the Subaccount.
SUBACCOUNTS
The Separate Account is divided into Subaccounts which invest in shares of
mutual funds. Each Subaccount may invest its assets in a separate class or
series of a designated mutual fund or funds. The Subaccounts are shown on page
3. Subject to the regulatory requirements then in force, the Company reserves
the right to:
1. change or add designated mutual funds or other investment vehicles;
2. add, remove or combine Subaccounts;
3. add, delete or make substitutions for securities that are held or
purchased by the Separate Account or any Subaccount;
4. operate the Separate Account as a management investment company;
5. combine the assets of the Separate Account with other separate accounts
of the Company or an affiliate thereof;
6. restrict or eliminate any voting rights of the owner with respect to the
Separate Account or other persons who have voting rights as to the
Separate Account; and
7. terminate and liquidate any Subaccount.
If any of these changes result in a material change to the Separate Account or a
Subaccount, the Company will notify the Owner of the change. The Company will
not change the investment policy of any Subaccount in any material respect
without complying with the filing and other procedures of the insurance
regulators of the state of issue.
VALUATION DATE
A Valuation Date is each day the New York Stock Exchange and the Company's Home
Office are open for business.
VALUATION PERIOD
A Valuation period is the interval of time from one valuation Date to the next
Valuation Date.
GENERAL PROVISIONS
THE CONTRACT
The entire contract between the Owner and the Company consists of this Contract,
the attached Application, and any Amendments, Endorsement or Riders to the
Contract. All statements made in the Application will, in the absence of fraud,
as ruled by a court of competent jurisdiction, be deemed representations and not
warranties. The Company will use no statement made by or on behalf of the Owner
or the Annuitant to void this Contract unless it is in the written Application.
Any change in the Contract can be made only with the written consent of the
President, a Vice President, or the Secretary of the Company.
The Purchase Payment(s) and the application must be acceptable to the Company
under its rules and practices. If they are not, the Company's liability shall be
limited to a return of the Purchase Payment(s).
COMPLIANCE
The Company reserves the right to make any change to the provisions of this
Contract to comply with or give the Owner the benefit of any federal or state
statute, rule or regulation. This includes, but is not limited to, requirements
for annuity contracts under the Internal Revenue code or the laws of any state.
The Company will provide the Owner with a company of any such change and will
also file such a change with the insurance regulatory officials of the state in
which the Contract is delivered.
MISSTATEMENT OF AGE
If the age of the Annuitant has been misstated, payments shall be adjusted, when
allowed by law, to the amount which would have been provided for the correct
age. Proof of the age of an annuitant may be required at any time, in a form
suitable to the Company. If payments have already commenced and the misstatement
has caused an underpayment, the full amount due will be paid with the next
scheduled payment. If the misstatement has caused an overpayment, the amount due
will be deducted from one or more future payments.
EVIDENCE OF SURVIVAL
When any payments under this Contract depend on the payee being alive on a given
date, proof that the payee is living may be required by the Company. Such proof
must be in a form accepted by the Company, and may be required prior to making
the payments.
INCONTESTABILITY
This Contract will not be contested after it has been in force for two years
from the Issue Date during the life of the Owner.
ASSIGNMENT
Please refer to page 3 to see if this Contract may be assigned. If it may be
assigned, no Assignment under this Contract is binding unless Received by the
Company in writing. The Company assumes no responsibility for the validity,
legality, or tax status of any Assignment. The Assignment will be subject to any
payment made or other action taken by the Company before the Assignment is
Received by the Company. Once filed, the rights of the Owner, Annuitant and
Beneficiary are subject to the Assignment. Any claim is subject to proof of
interest of the assignee.
DEATH BENEFIT PROVISIONS
PROOF OF DEATH
Any of the following will serve as Proof of Death
1. certified copy of the death certificate;
2. certified decree of a court of competent jurisdiction as to the finding
of death;
3. written statement by a medical doctor who attended the deceased Owner;
or
4. any proof accepted by the Company.
DISTRIBUTION RULES
The entire Death Benefit with any interest shall be paid within 5 years after
the death of any Owner, except as provided below. In the event that the
Designated Beneficiary elects an Annuity Option, the length of time for the
payment period may be longer than 5 years if: (1) the Designated Beneficiary is
a natural person; (2) the Death Benefit is paid out under one of Annuity Options
1 through 8; and (3) payments are made over a period that does not exceed the
life or life expectancy of the Designated Beneficiary; and (4) Annuity Payments
begin within one year of the death of the Owner. If the deceased Owner's spouse
is the sole Designated Beneficiary, the spouse shall become the sole Owner of
the Contract. He or she may elect to (1) keep the Contract in force until the
sooner of the spouse's death or the Annuity Start Date; or (2) receive the Death
Benefit.
If the Owner dies after the Annuity Start Date, any Annuity Payments shall
continue to be paid at least as rapidly as under the method of payment being
used as of the date of the Owner's death.
If the Owner is a Nonnatural Person, the distribution rules set forth above
apply in the event of the death of, or a change in, the Annuitant. This Contract
is deemed to incorporate any provision of Section 72(s) of the Internal Revenue
Code of 1986, as amended (the "Code"), or any successor provision. This Contract
is also deemed to incorporate any other provision of the Code deemed necessary
by the Company, in its sole judgment, to qualify this Contract as an annuity.
The application of the distribution rules will be made in accordance with Code
section 72(s), or any successor provision, as interpreted by the Company in its
sole judgment.
The foregoing distribution rules do not apply to a Contract which is: (1)
provided under a plan described in Code section 401(a): (2) described in Code
section 403(b); (3) an individual retirement annuity or provided under an
individual retirement account or annuity; or (4) otherwise exempt from the Code
section 72(s) distribution rules.
ANNUITY PAYMENT PROVISIONS
ANNUITY START DATE
The owner may choose the Annuity Start Date at the time of application. The
Annuity Start Date may not be prior to the third Contract Anniversary; provided
that the Annuity Start Date may be prior to the third Contract Anniversary if
one of Annuity Options 5 or 6 is elected. The Annuity Start Date must be prior
to the later of: (1) the oldest Annuitant's eighty-fifth birthday; or (2) the
tenth Contract Anniversary, but in no event later than the oldest Annuitant's
ninety-fifth birthday. If no Annuity Start Date is chosen, the Company will use
the later of (1) the oldest Annuitant's seventieth birthday; or (2) the tenth
Contract anniversary, but in no event later than the Annuitant's ninety-fifth
birthday.
The Annuity Start Date is the date the first payment will be paid to the
Annuitant under one of the Annuity Options.
CHANGE OF ANNUITY START DATE
An Owner may change the Annuity Start Date subject to approval by the Company. A
request for the change must be made in writing. The written request must be
Received by the Company at least 30 days prior to the new Annuity Start Date and
30 days prior to the previous Annuity Start Date.
ANNUITY START AMOUNT
The Annuity Start Amount is applied to one or more of the Annuity Options listed
on page 19. The Annuity Start Amount is: (1) the Contract Value on the Annuity
Start Date; less (2) any Premium Taxes due or paid by the Company. Unless
otherwise directed by the Owner. Annuity Start Amount derived from Fixed Account
Contract Value will be applied to purchase a Fixed Annuity Option; that derived
from Separate Account Contract Value will be applied to purchase a Variable
Annuity Option.
WITHDRAWAL CHARGES
Withdrawal Charges are not applied to (1) Annuity payments made under Annuity
Options 1-4, 7 and 8; or (2) those made under Annuity Options 5 and 6 that
provide for payments over a period of at least 7 years. Withdrawal Charges are
applied to annuity payments under Annuity Options 5 and 6 that provide for
payments over a period of less than 7 years. See "Withdrawal Provisions" on
pages 12-15.
ANNUITY TABLES
Annuity Table A through C show the guaranteed minimum amount of monthly annuity
Payment per $1,000 of Annuity Start Amount for Annuity Options 1 through 4, 7
and 8 that applied to the first Variable Annuity Payment and to each payment for
Fixed Annuity Payment. The amount of each Annuity Payment for Annuity Options 1
through 4 and 8 will depend on the Annuitant's age on the Annuity Start Date.
Table A and B assume 1900 as the year of birth of the Annuity To use Tables A
and B for an Annuitant born after 1900, the actual age is reduced by 0.1
(one-tenth) of a year for each year the year of birth exceeds 1900. For an
Annuitant with a birth year prior to 1900, the actual age is increased in a like
manner. The actual age (in completed months) reduced or increased becomes the
"adjusted age of the Annuitant." The guaranteed payout rate is then found by
interpolating the Annuitant's adjusted age between the ages shown in Tables A
and B. Tables A and B are based on the 1983 Table "A" mortality table and an
interest rate of 3.5% per year. On request the company will furnish the amount
of monthly annuity Payment per $1,000 applied for any ages not shown.
For annuity Options 5 through 7, annuity rates based on age are not used to
calculate annuity payment. Annuity Payments for Options 5 and 6 are computed
without reference to the Annuity Tables.
ANNUITY PAYMENTS
The Annuity Option is shown on page 3. Owner may choose any form of Annuity
Option that is allowed by the Company. The Owner may choose an Annuity Option by
written request. This request must be Received by the Company at least 30 days
prior to the Annuity Start Date. Several Annuity Options are listed on pages 19
and 20. No Annuity Option can be selected that requires the Company to make
periodic payments of less than $50.00. If no Annuity Option is chosen prior to
the Annuity Start Date, the Company will use Life with 10-Year Fixed Period
Option. Each Annuity Option allows for making Annuity Payments annually,
semiannually, quarterly or monthly.
ANNUITY OPTIONS (CONTINUED)
OPTION 5
FIXED PERIOD OPTION: This option provide payments for a fixed number of years
between 5 and 20. If the Contract Value is held in the Fixed Account, then the
amount of the payments will vary as a result of the interest rate (as adjusted
periodically) credited on the Fixed Account. This rate is guaranteed to be no
less than the Guaranteed Rate shown on page 3. If the Contract Value is held in
the Separate Account then the amount of the payments will vary as a result of
the investment performance of the Subaccounts chosen. If all the Annuitants die
before receiving the fixed number of payments, any remaining payments will be
made to the Designated Beneficiary.
OPTION 6
FIXED PAYMENT OPTION: This option provides a fixed payment amount. This amount
is paid until the amount applied, including daily interest adjustment, is paid.
If the Contract Value is held in the Fixed Account, then the number of payments
will vary as a result of the interest rate (as adjusted periodically) credited
on the Fixed Account. This rate is guaranteed to be no less than the Guaranteed
Rate shown on page 3. If the Contract Value is held in the Separate Account,
then the number of payments will vary as a result of the investment performance
of the Subaccounts chosen. If all the Annuitants die before receiving all the
payments, any remaining payments will be made to the Designated Beneficiary.
OPTION 7
PERIOD CERTAIN OPTION: This option provides payments for a fixed period of 5,
10, 15 or 20 years. Payments will be made until the end of this period. If the
Annuitant dies prior to the end of the period, the remaining payments will be
made to the Designated Beneficiary. Table C shows some of the guaranteed rates
for this option.
OPTION 8
JOINT AND CONTINGENT SURVIVOR OPTION: This option provides payments for the life
of the primary Annuitant. Payments will be made to the primary Annuitant as long
as he or she is living. Upon the death of the primary Annuitant, payments will
be made to the contingent Annuitant as long as he or she is living. If the
Contingent Annuitant is not living upon the death of the Primary Annuitant, no
payments will be made to the Contingent Annuitant. Table B shows some of the
guaranteed rates for this option.
ANNUITY TABLES
TABLE A
SETTLEMENT OPTIONS ONE, TWO, AND THREE
MINIMUM INITIAL MONTHLY INSTALLMENTS PER $1,000 OF AMOUNT APPLIED
Adjusted
Age Option One Option Two Option Three
of Annuitant Life Year Fixed Period Ends Unit
Unisex Only 5 Years 10 Years 15 Years 20 Years Refund
----------- ---------- ------- -------- -------- -------- ------------
55 4.54 4.53 4.51 4.46 4.38 4.40
56 4.62 4.61 4.58 4.53 4.44 4.47
57 4.71 4.70 4.66 4.60 4.51 4.54
58 4.80 4.79 4.75 4.68 4.57 4.62
59 4.90 4.88 4.84 4.76 4.64 4.70
60 5.00 4.99 4.93 4.84 4.70 4.78
61 5.11 5.09 5.03 4.93 4.77 4.87
62 5.23 5.21 5.14 5.02 4.84 4.96
63 5.36 5.33 5.25 5.12 4.91 5.06
64 5.49 5.46 5.37 5.21 4.98 5.17
65 5.64 5.60 5.50 5.31 5.05 5.28
66 5.79 5.75 5.63 5.42 5.12 5.39
67 5.95 5.91 5.77 5.53 5.19 5.52
68 6.13 6.08 5.91 5.63 5.25 5.65
69 6.32 6.26 6.07 5.74 5.32 5.79
70 6.53 6.46 6.23 5.86 5.37 5.94
71 6.75 6.67 6.40 5.97 5.43 6.09
72 6.99 6.89 6.58 6.08 5.48 6.26
73 7.26 7.13 6.76 6.18 5.52 6.44
74 7.54 7.39 6.95 6.29 5.57 6.63
75 7.85 7.67 7.14 6.39 5.60 6.83
Values not shown will be provided upon request. Annual, semiannual, or quarterly
installments can be determined by multiplying the monthly installments by
11.812853, 5.9572227, and 2.9914196 respectively.
TABLE B
SETTLEMENT OPTIONS FOUR AND EIGHT
MINIMUM INITIAL MONTHLY INSTALLMENT PER $1,000 OF AMOUNT APPLIED
Adjusted Age of Adjusted Age of Secondary Annuitant
Primary Annuitant 55 60 62 65 70 75
----------------- ---- ---- ---- ---- ---- ----
55 4.16 4.27 4.30 4.35 4.42 4.47
60 4.34 4.51 4.57 4.66 4.78 4.86
62 4.41 4.61 4.68 4.79 4.94 5.04
65 4.51 4.76 4.85 4.99 5.20 5.35
70 4.66 4.99 5.13 5.34 5.67 5.95
75 4.78 5.19 5.37 5.66 6.16 6.63
Values not shown will be provided upon request. Annual, semiannual, or quarterly
installments can be determined by multiplying the monthly installments by
11.812853, 5.9572227, and 2.9914196 respectively.
TABLE C
SETTLEMENT OPTION SEVEN
MINIMUM INITIAL MONTHLY INSTALLMENT PER $1,000 OF AMOUNT APPLIED
PERIOD CERTAIN
5 YEARS 10 YEARS 15 YEARS 20 YEARS
------- -------- -------- --------
18.11 9.83 7.1 5.75
Values not shown will be provided upon request. Annual, semiannual, or quarterly
installment can be determined by multiplying the monthly installments by
11.812853, 5.9572227, and 2.9914196 respectively.
PARKSTONE VARIABLE ANNUITY
A BRIEF DESCRIPTION OF THIS CONTRACT
This is a FLEXIBLE PREMIUM DEFERRED VARIABLE ANNUITY CONTRACT
*Purchase Payments may be made until the earlier of the Annuity Start Date or
termination of the contract. *A Death Benefit may be paid prior to the Annuity
Start Date according to the Contract provisions. *Annuity Payments being on the
Annuity Start Date using the method as specified in this Contract.
*This Contract is Participating.
ALL PAYMENTS AND VALUES PROVIDED BY THIS CONTRACT, WHEN BASED ON THE INVESTMENT
EXPERIENCE OF THE SEPARATE ACCOUNT, ARE VARIABLE AND MAY INCREASE OR DECREASE IN
ACCORDANCE WITH THE INVESTMENT EXPERIENCE OF THE SEPARATE ACCOUNT. THERE ARE NO
GUARANTEED MINIMUM PAYMENTS OR CASH VALUES. (SEE "CONTRACT VALUE AND EXPENSE
PROVISIONS" AND "ANNUITY PAYMENT PROVISIONS" FOR DETAILS.)
SECURITY BENEFIT LIFE INSURANCE COMPANY
A Member of The Security Benefit Group of Companies 000 XX Xxxxxxxx, Xxxxxx, XX
00000-0001 1-800-355-4555
