EXHIBIT 99.4(a)
Form of Individual Flexible Premium
Variable Accumulation Deferred Annuity Contract
Form 90-53
[LOGO OF PACIFIC MUTUAL]
PACIFIC MUTUAL
LIFE INSURANCE COMPANY
000 Xxxxxxx Xxxxxx Xxxxx
Xxxxxxx Xxxxx, XX 00000
INDIVIDUAL FLEXIBLE PREMIUM VARIABLE ACCUMULATION DEFERRED ANNUITY CONTRACT
Investment Experience Reflected in Benefits
Variable and Fixed Accumulation Prior to Annuity Start Date; Fixed Annuity
Payments Thereafter
Death Benefit Proceeds Payable Prior to Annuity Start Date
Participating
READ YOUR CONTRACT CAREFULLY. This is a legal Contract between you, the Owner,
and us, Pacific Mutual Life Insurance Company, a mutual company.
We agree to pay the benefits of this Contract according to its provisions.
The consideration for this Contract is the application for it, a copy of which
is attached, and payment of the premiums.
Variable Account Accumulated Value may increase or decrease depending upon
Variable Account investment experience. There is no guaranteed Variable Account
Accumulated Value.
Contract loan value is less than one hundred percent (100%) of the Contract's
Accumulated Value.
Free Look Right - You may return this Contract within 10 days after you receive
it. To do so, mail it to us or our agent. This Contract will then be deemed
void from the beginning, no withdrawal charge will be imposed and we will
refund:
- any premium payment allocated to the Fixed Account; and
- any Variable Account Accumulated Value as of the Valuation Date we
receive the Contract; plus
- any Contract fees and Charges deducted from the Contract's Accumulated
Value in any Variable Account.
ST-43
Signed as our Home Office, 000 Xxxxxxx Xxxxxx Xxxxx, Xxxxxxx Xxxxx, Xxxxxxxxxx
00000.
/s/XXXXXX X. XXXXXX /s/XXXXXX X. XXXXX
------------------------------------ ------------------------------
Chairman and Chief Executive Officer Secretary
Form 90-53
TO OUR ILLINOIS POLICYOWNERS
At Pacific Mutual, we always strive to provide our policyowners with the best
products and services. Any business transaction, however, can be potentially
misunderstood and may end up as a complaint. Should you have a problem of that
nature, your local agent and agency will be glad to help you. You may also
contact:
Xxx X. Xxxxxxxx Consumer Services Section
Assistant Vice-President Department of Insurance
Pacific Mutual Life Insurance OR 000 X. Xxxxxxxxxx Xxxxxx
000 Xxxxxxx Xxxxxx Xxxxx Xxxxxxxxxxx, XX 00000
Xxxxxxx Xxxxx, XX 00000
11194
CONTRACT SPECIFICATIONS
BASIC CONTRACT - INDIVIDUAL FLEXIBLE PREMIUM VARIABLE
ACCUMULATION DEFERRED ANNUITY
ACCOUNT ALLOCATIONS AVAILABLE:
MONEY MARKET MULTI-STRATEGY GROWTH LT
MANAGED BOND INTERNATIONAL EQUITY INCOME
HIGH YIELD BOND GOVERNMENT SECURITIES EQUITY INDEX
BOND & INCOME EQUITY FIXED
AGGRESSIVE EQUITY EMERGING MARKETS
WITHDRAWAL CHARGE: AGE OF PREMIUM
IN CONTRACT YRS CHARGE PERCENT
1 6%
2 6%
3 5%
4 4%
5 3%
6 0%
ADMINISTRATIVE CHARGE: .00012500 OF THE UNLOANED ACCUMULATED VALUE.
MAINTENANCE FEE: $30.00 DEDUCTED ANNUALLY BEGINNING ON THE FIRST
CONTRACT YEAR
PAGE 3.0
CONTRACT NUMBER; VA96196500 CONTRACT DATE: 03-22-1996
ISSUE AGE AND SEX: 55 FEMALE ANNUITANT(S): XXXXX X XXXXXXX
INITIAL PREMIUM: $10,000.00 OWNER(S): XXXXX X XXXXXXX
ANNUITY START DATE: 09-17-2035
VARIABLE ANNUITY CONTRACT
READ YOUR CONTRACT CAREFULLY
DEFINITIONS
PM, WE, OUR and US - refer to Pacific Mutual Life Insurance Company.
MONTHLY PAYMENT DATE - is the date each month on which certain contract charges
are deducted from the Accumulated Value. This day is shown on the Contract
Specifications pages. The first monthly payment date is the Contract Date.
HOME OFFICE - means PM's Variable Life Administration Department located at 000
Xxxxxxx Xxxxxx Xxxxx, Xxxxxxx Xxxxx, Xxxxxxxxxx 00000. Mailing address: 000
Xxxxxxx Xxxxxx Xxxxx, X.X. Box 7500, Newport Beach, California 92658-7500.
YOU, YOUR or OWNER - refers to the owner of this Contract.
CONTRACT DATE - is shown on the Contract Specifications pages. Contract Years,
Quarters and Months and quarterly, semi-annual and annual anniversaries are
measured from this date.
CONTRACT YEARS, QUARTERS, MONTHS - are twelve-month periods, three-month
periods, and one-month periods measured from the Contract Date.
ACCUMULATION PERIOD - The period commencing on the Contract Date and ending on
the Annuity Start Date or, if earlier, when the Contract is terminated, either
through a Full Withdrawal, payment of charges, or payment of the death benefit
proceeds.
AGE - means the Owner's or Annuitant's Age nearest birthday, as applicable, as
of the Contract Date, increased by the number of complete Contract Years
elapsed.
ANNUITANT - is the person you name to receive the periodic annuity payments. If
you designate two persons as Joint Annuitants, unless otherwise indicated,
Annuitant means the Joint Annuitants or the survivor Annuitant, whichever
applies. You may change the Annuitant if you send us written notice before the
Annuity Start Date. However, you should do so only on the advice of your tax
adviser, as such event may result in special tax consequences.
BENEFICIARY - is the person you name to receive the death benefit proceeds, if
any, payable on the death of the Annuitant prior to the Annuity Start Date or
any remaining guaranteed annuity benefits after the Annuity Start Date. If no
Beneficiary is named or the Beneficiary does not survive the Annuitant, then the
Annuitant's estate shall have the rights of the Beneficiary. If there is a
surviving Joint Annuitant, the death benefit proceeds are payable only on the
death of the surviving Joint Annuitant. If there is a surviving Contingent
Annuitant and the Annuitant dies prior to the Annuity Start Date, the Contingent
Annuitant replaces the Annuitant and death benefit proceeds are payable only on
the death of the Contingent Annuitant.
CONTINGENT ANNUITANT - If there is a Contingent Annuitant, that person becomes
the Annuitant upon the Annuitant's death, if death occurs before the Annuity
Start Date.
CONTINGENT OWNER - If there is a Contingent Owner, that person becomes the Owner
if you die before the Annuity Start Date.
ANNUITY START DATE - is the date you choose to have us begin periodic annuity
payments to the Annuitant. It is shown on the Contract Specifications pages.
If you do not choose an Annuity Start Date,
we will make the Annuity Start Date the Contract Anniversary nearest the
Annuitant's 85th birthday. If there are Joint Annuitants, we will use the 85th
birthday of the younger Joint Annuitant. You may change the Annuity start Date
by sending us written notice before the Annuity Start Date then in effect.
However, in no event can the Annuity Start Date be later than the first day of
the month following the 95th birthday of the Annuitant or the younger Joint
Annuitant, if applicable.
OWNER - owns and controls this Contract and can exercise all contractual rights
while the Annuitant is living. You may change the Owner by sending us written
notice that is satisfactory to us. If there are Joint Owners, Owner means Joint
Owners, unless otherwise indicated.
OWNER BENEFICIARY - the person you name (other than a Joint or Contingent Owner)
to receive the death benefit proceeds, if any, if the Owner dies before the
Annuitant and before the Annuity Start Date, if living; otherwise, the Owner's
estate.
WRITTEN NOTICE - all changes or requests must be in writing and must be received
at our Home Office. Whenever written notice is required, send it to our Variable
Life Administration Department at its mailing address. The address is shown in
the Definitions Section under Home Office.
GENERAL PROVISIONS
ENTIRE CONTRACT - This Contract is between the Owner and PM. This Contract, the
attached application, all subsequent applications to change the Contract, and
any riders and endorsements make up the entire Contract. All statements made in
the application are representations and not warranties. This Contract may not
be modified, nor may any of our rights or requirements be waived, except in
writing by our President or Secretary.
INCONTESTABILITY - This Contract is not contestable.
MISSTATEMENTS - If the Age or sex of the Annuitant or the Age of the Owner is
misstated in the application, any benefits provided by this Contract prior to
the Annuity Start Date and the periodic annuity payments will be determined
using the correct Age and sex, if applicable. If the age or sex, if applicable,
is corrected after annuity payments begin, we will:
- if underpayment has occurred, pay the full amount due with the next
scheduled payment;
- if overpayment has occurred, deduct the amount due us from future
payments, spread equally over the remaining payments.
BASIS OF VALUES - A detailed statement showing how values are determined has
been filed with the state insurance departments. All values and reserves are at
least equal to those required by the laws of the state in which this Contract is
delivered.
DIVIDENDS - We do not expect dividends to become payable. At the end or each
Contract Year, we will determine your dividend, if any. You may choose to have
it paid in cash or added to your Accumulated Value. If you do not make a
choice, we will add it to your Accumulated Value. We will allocate any dividend
added to Accumulated Value in accordance with your most recent premium
allocation instructions, unless you instruct otherwise, subject to the five
investment alternatives limitation. You should consult with your tax adviser
before making any election.
ASSIGNMENT - You may assign all rights and benefits under this Contract before
the Annuity Start Date. We are not bound by any assignment until we have
received written notice satisfactory to us. We are not responsible for the
validity of any assignment. If the Contract has been absolutely assigned, the
assignee
becomes the Owner. The person receiving the Contract as security does not
become the Owner. You should consult with your tax adviser before taking any
action.
REPORTS - A report will be mailed to you at your last known address at the end
of each Contract Quarter prior to the Annuity Start Date. This report will
include the following information for the Contract Quarter.
- the Accumulated Value;
- the Full Withdrawal Value;
- any existing Contract Debt;
- transactions that occurred during the Contract Quarter; and
- any information required by law.
In addition to the above reports, a semi-annual and an annual report will also
be mailed to you. These reports will contain financial statements for the
Separate account and the designated investment company or companies in which the
Separate Account invests. The latter will include a list of the portfolio
securities of the investment company, as required by the Investment Company Act
of 1940. We will also send any other reports required by federal securities
law.
OWNERSHIP OF ASSETS - We have the exclusive and absolute control of our assets,
including all assets in the Separate Account.
COMPLIANCE - We reserve the right to make any change to the provisions of this
Contract to comply with, or give you the benefit of, any federal or state
statute, rule, or regulation, including, but not limited to, requirements for
annuity contracts under the Internal Revenue Code or that of any state.
We will provide you with a copy of any such change, and will also file such a
change with the insurance supervisory official of the state in which this
Contract is delivered.
WHEN THIS CONTRACT ENDS - This Contract ends when any of the following events
occur:
- You request that this Contract end; or
- If the Contract's Full Withdrawal Value is zero; or
- Payment of the death benefit proceeds has occurred.
PREMIUMS
PREMIUMS - This Contract will not be in force until the initial premium is paid.
Additional premium payments must be at least $250. Premiums may be paid at any
time prior to the Annuity Start Date, subject to the premium limitations shown
below. Premiums are payable either at our Home Office or through an Agent of
PM. Checks should be made payable to Pacific Mutual Life Insurance Company. On
written request a premium receipt signed by an officer of PM will be provided
after payment.
PREMIUM ALLOCATION - During the Free Look Period, premiums received by us at our
Home Office will be allocated to the Money Market Variable Account. We will
allocate the Accumulated Value in the Money Market Variable Account to the
Variable Accounts and Fixed Account fifteen days after the Contract is issued,
according to the premium allocation specified in the application or your most
recent instructions received by us, if any.
Upon written notice, you may change the premium allocation. Subsequent premiums
credited to your Contract 15 or more days after the Contract is issued will be
allocated to the Fixed and Variable Accounts according to your most recent
instructions, subject to the following. The Accumulated Value may be allocated
to no more than five of the Fixed and Variable Accounts. If we receive a
premium from you and your most recent allocation instructions would violate this
requirement, we will allocate the premium to the Fixed and Variable Accounts in
the same proportion as the Accumulated Value in those Accounts.
PREMIUM LIMITATIONS - Our prior approval is required before we will accept a
premium if, as a result, the sum of all premiums received for the Contract would
exceed $1,000,000.
Also, our prior approval is required to allocate a premium to the Fixed Account
if immediately after the premium allocation, the Accumulated Value in the Fixed
Account would equal or exceed $250,000.
DETERMINATION OF VALUES
ACCUMULATED VALUE - The Accumulated Value on any Valuation Date is the sum of
your Contract's Accumulated Value in the Fixed and Variable Accounts plus the
amount set aside in the Loan Account to secure any Contract Debt on that date.
LOAN ACCOUNT - The amount set aside to secure any Contract Debt in the Loan
Account on each Contract Anniversary is equal to the amount of debt. During
each Contract Year, the amount in the Loan Account on any Valuation Date is:
- the amount in the Loan Account on the prior anniversary increased by
interest;
- plus any loan taken since the prior anniversary increased by interest;
and
- minus any loan amount repaid including withdrawal amounts for repayment,
since the prior anniversary increased by interest.
FIXED ACCOUNT - The Accumulated Value in the Fixed Account on any Valuation Date
is:
- the Accumulated Value in the Fixed Account on the prior Monthly Payment
Date increased by interest;
- minus any maintenance fee assessed against the Fixed Account.
- plus the amount of any premiums received and allocated to the Fixed
Account since the last Monthly Payment Date increased by interest;
- minus any monthly deduction assessed against the Fixed Account, and
other deductions due, if any, that are assessed against the Fixed
Account increased by interest.
- minus any deductions caused by withdrawals or transfers from the Fixed
Account, including transfers to the Loan Account, since the last Monthly
Payment Date increased by interest; and
- plus the amount of any transfers of Accumulated Value to the Fixed
Account, including transfers from the Loan Account, since the last
Monthly Payment Date increased by interest.
VARIABLE ACCOUNTS - Assets in the Variable Accounts are divided into
Accumulation units, which are a unit of measure used to calculate the value of
your allocation in a Variable Account during the
Accumulation Period. We credit your Contract with accumulation units in each
Variable Account as a result of:
- any premiums received and allocated to the Variable Account; and
- transfers of Accumulated Value to the Variable Account, including
transfers from the Loan Account.
We debit Accumulation units in each Variable Account as a result of:
- transfers of Accumulated Value from the Variable Account, including
transfers to the Loan Account;
- any deductions caused by withdrawals from the Variable Account;
- the monthly deduction and other deductions due, if any, that are
assessed against the Variable Account; and
- any maintenance fee assessed against the Variable Account.
To determine the number of Accumulation units debited or credited in connection
with a transaction, we divide the dollar amount of the transaction by the
Accumulation unit value of the affected Variable Account. The number of
Accumulation units in the Variable Account will change only if Accumulation
units are debited or credited for the transactions above.
The Accumulation unit value of each Variable Account is determined on each
Valuation Date. The number of units in each Variable Account will not change
because of subsequent changes in the Accumulation unit value.
The initial Accumulation unit value of each Variable Account was $10. To
calculate the Accumulation unit value of a Variable Account on any Valuation
Date, we divide the value of the Variable Account's net assets by the total
number of Accumulation units credited to the Variable Account on that date.
To determine the value of the Variable Account's net assets, we take into
account:
- the investment performance of the Variable Account;
- any dividends or distributions paid to the Variable Account;
- the daily Mortality and Expense Risk charge, equal to .00003424658
(1.25% annually) multiplied by the Accumulated Value in the Variable
Account, for each calendar day on or between Valuation Dates; and
- charges, if any, that may be assessed by us for income taxed
attributable to the operation of the Variable Account.
A Valuation Date is each day required by applicable law and currently includes
each day the New York Stock Exchange is open together with each day Pacific
Mutual is normally open for business.
To determine your Accumulated Value in each Variable Account, we multiply the
number of your Accumulation units in the Variable Account by the Accumulation
unit value of such Account.
INTEREST - We will credit interest on the Accumulated Value in the Fixed Account
at a rate not less than .3273% per month, compounded monthly. This is
equivalent to 4% annually. At our discretion, we may credit a higher rate of
interest on the Fixed Account. If we declare a higher rate, premiums allocated
or transfers made to the Fixed Account during the time the higher rate is in
effect are guaranteed to earn that rate until the end of the Contract Year.
Thereafter, higher rates that may be declared on such premiums or transfers and
the interest thereon will be guaranteed for at least one year.
We will credit interest on the amounts in the loan Account at the Loan Credited
Interest rate. The effective annual Loan Credited Interest rate is equal to the
Loan Interest Rate charged minus 1.75%.
TRANSFER AND WITHDRAWAL BENEFITS
TRANSFERS - While the Annuitant is living and your Contract is in force prior to
the Annuity Start Date, you may, upon written notice, transfer your Accumulated
Value, or a part of it, among the Fixed and Variable Accounts subject to the
following:
Only one transfer from the Fixed Account may be made in any twelve-month
period. If the Accumulated Value in the Fixed Account is at least $1000,
transfers from the Fixed Account will be limited to 20% of the Accumulated
Value in the Fixed Account. Transfers from the Variable accounts to the
Fixed Account may be made only during the Contract Month preceding each
Contract Anniversary. After each transfer, Accumulated Value may be
allocated to no more than five of the Fixed and Variable Accounts. No
transfer may be made until 15 days after the Contract is issued.
Also, our prior approval is required to allocate a transfer to the Fixed
Account if, immediately after the transfer, the Accumulated Value of the
Fixed Account would equal or exceed $250,000.
No charges are currently imposed upon a transfer. WE reserve the right at a
future date to limit the size of transfers and remaining balances, to assess
transfer charges and to limit the number and frequency of transfers.
BAILOUT PROVISION - The first time the Fixed Account interest rate credited on
any premium or transfer allocated to the Fixed Account falls 1% or more below
the initial guaranteed rate for that premium or transfer, the limitations on
transfers from the Fixed Account will be waived for 60 days for that portion of
the Accumulated Value attributable to that premium or transfer.
WITHDRAWAL BENEFITS - During the Accumulation Period and after the Free Look
Period, you may request a Full or Partial Withdrawal from your Accumulated Value
while the Annuitant is living, and while your Contract is in force by sending us
written notice. If you make a Full Withdrawal, this Contract must accompany
your written request. If the Contract is lost, we require a signed lost
Contract form. If you make a Full Withdrawal, this Contract will terminate and
any obligation we have under this Contract will be satisfied. If you make a
Partial Withdrawal, the amount withdrawn must be at least $500 and the remaining
Full Withdrawal Value must be at least $500. Any time a withdrawal is made, we
will deduct the amount of the withdrawal plus any applicable Withdrawal Charge
from the Accumulated Value proportionately to your Accumulated Value in each
Variable Account and the Fixed Account, unless otherwise requested by you.
Withdrawal proceeds less any charge for premium taxed, may be applied towards an
Annuity Option under this Contract or towards the purchase of any other annuity
option we then offer.
FULL WITHDRAWAL VALUE - This is the amount that will be paid upon a Full
Withdrawal. The Full Withdrawal Value is the Accumulated value less any
maintenance fee due, less any Withdrawal Charge, if any, and less any amount in
the Loan Account.
CONTRACT LOANS
CONTRACT LOANS - If your Contract is issued on a qualified basis under Section
401 of the Internal Revenue Code and if loans are allowed under your qualified
plan, you may obtain loans upon written notice after the first Contract Year and
prior to the Annuity Start Date, while the Annuitant is living and this Contract
is in force, on the sole security of the amount in the Loan Account for this
Contract.
AMOUNT AVAILABLE - The amount available for a loan will depend on your
Contract's Accumulated Value. If the Accumulated Value is less than or equal to
$20,000, the maximum Loan Account valance immediately after any loan may not
exceed the lesser of 80% of the Contract's Accumulated value or $10,000. If the
Accumulated Value is greater than $20,000, the maximum Loan Account balance
immediately after any loan may not exceed the lesser of 50% of the Contract's
Accumulated Value, or $50,000 reduced by the excess of (a) the highest
outstanding Contract Debt within the preceding 12 month period ending on the
date the loan is made over (b) the outstanding Contract Debt on the date the
loan is effective. The amount of the loan must be at least $2,000.
LOAN INTEREST RATE - Except as described in the next paragraph, the Loan
Interest Rate is the higher of:
- the Moody's Corporate Bond Yield Average-Monthly Average Corporates, as
published by Xxxxx'x Investors Service, Inc., or its successor, for the
calendar month ending two months before the month in which each Contract
Anniversary occurs; or
- 5%.
The Loan Interest Rate applicable to your Contract will be determined annually
and will be effective for 12 months from each Contract Anniversary. Loan
Interest will accrued daily.
- The interest rate we charge may be increased if the Loan Interest Rate
increased by 1/2% or more from that charges in the preceding Contract
Year.
- The interest rate we charge will be decreased if the Loan Interest Rate
decreases by 1/2% or more from that charge in the preceding Contract
Year.
- Any change in the interest rate will be effective on the Contract
Anniversary.
- The revised interest rate will be charged on the entire outstanding loan
during the Contract Year.
We will notify you of the current Loan Interest Rate on your Contract when:
- you make a loan on your Contract; or
- we increase the interest rate on any existing Contract Debt.
In the event that the Moody's Corporate Bond Yield Average-Monthly Average
Corporates is no longer published, we will use a substantially similar average
as established by regulation within the state in which this Contract is
delivered.
LOAN ACCOUNT - When a loan is taken, an amount equal to the loan amount is
transferred out of the Accumulated Value in the Fixed and Variable Accounts int
o the Loan Account to secure the loan. Unless you request otherwise, loan
amounts will be deducted from the Variable Accounts and the Fixed Account on a
proportionate basis, up to the amount available. We will credit interest
monthly on amounts in the Loan
Account at the Loan Credited Interest rate. The effective annual Loan Credited
Interest rate is equal to the Loan Interest Rate charged minus 1.75%. On each
Contract Anniversary, the interest credited will be transferred from the Loan
Account to the Fixed and Variable Accounts according to your most recent premium
allocation instructions.
REPAYMENT - Loans must be repaid within 5 years and before the Annuity Start
Date, except loans used to purchase the principal residence of the Annuitant
must be repaid within 20 years and before the Annuity Start Date.
Repayment of loan principal plus accrued interest is required each Contract
Quarter. Loan repayments will be due on the Contract Quarterly Anniversary next
following the date the loan is effective and on each succeeding Contract
Quarterly Anniversary thereafter. Repayment must be received at our Home office
before the end of the Contract Month in which the due date falls.
If we do not receive the repayment before the end of the Contract Month in which
the due date falls, a Partial Withdrawal equal to the repayment amount due and
any applicable Withdrawal Charge will be made from the Contract and paid to us.
The date of the partial Withdrawal will be the Monthly Payment Date next
following the last day of the Contract Month in which the repayment was due.
The portion of the Partial Withdrawal equal to the unpaid principal amount due
will be deducted from the Loan Account. The portion equal to the interest due
and any Withdrawal Charge imposed will be deducted from the Accumulated Value in
the Variable Accounts and Fixed Account on a proportionate basis.
If we receive a repayment in excess of a billed amount, the excess will be
applied first towards the principal portion of the outstanding loan and then to
any accrued interest. Payments received by us which are less than the billed
amount will be returned to you.
Prepayment of the entire outstanding Contract Debt plus any interest due may be
made at any time prior to the Annuity Start Date and while this Contract is in
force. At the time of the prepayment, we will bill you for any interest due.
We will consider the loan paid when this interest is also paid. An amount equal
to the portion of any loan repaid, but not more than the amount in the Loan
Account, will be transferred from the Loan Account to the Fixed and Variable
accounts according to your most recent instructions.
Any payment we receive from you while you have a loan outstanding will be first
considered a loan repayment, unless you tell us in writing it is a premium
payment.
DEATH BENEFITS
DEATH OF ANNUITANT - We will pay the death benefit proceeds to the Beneficiary
if the Annuitant dies prior to the Annuity Start Date unless there is a
surviving Joint or Contingent Annuitant. In such event, the surviving Joint or
Contingent Annuitant becomes the Annuitant. If the Annuitant dies at or after
Age 76, the death benefit will be the Accumulated Value as of the Valuation Date
due proof of death and instructions regarding payment are received by PM. If
the Annuitant dies prior to Age 86, the death benefit will be the greater of (a)
the Accumulated Value as of the Valuation Date due proof of death and
instructions regarding payment are received by PM; or (b) the total premium paid
into the Contract less any deductions caused by previous partial withdrawals.
No Withdrawal Charge will be imposed. The death benefit proceeds will be the
death benefit reduced by the amount in the Loan Account, if any. Payment will
be made when we receive acceptable proof of death and instructions regarding
payment at our Home Office. Instead of a lump sum payment, the amount of the
death benefit proceeds, less any applicable charge for premium taxes, may be
applied towards an Annuity Option under this Contract or towards the purchase of
any other annuity option we then offer.
DEATH OF OWNER - If the Owner dies while the Annuitant is living and prior to
the Annuity Start Date, we will pay the death benefit proceeds to the surviving
Joint or Contingent Owner, if any. If there is no
surviving Joint or Contingent Owner, the death benefit proceeds will be paid to
the Owner Beneficiary, if living, and otherwise to the Owner's estate. If the
Owner is not also the Annuitant, then, in the event the deaths of the Owner and
Annuitant are under circumstances where it cannot be determined who died first,
payment will be made to the Beneficiary, if living; otherwise to the Annuitant's
estate. If the Owner and the Annuitant are the same, payment will be made to
the Beneficiary, if living; otherwise to the Annuitant's estate.
The death benefit will be as stated above, except that the deceased Owner's Age,
instead of the Annuitant's will be used to determine the death benefit.
If the spouse of the deceased Owner is the Owner Beneficiary, or is the sole
surviving Joint or Contingent Owner, the spouse may continue this Contract in
force until the earliest of (a) the spouse's death, (b) the death of the
annuitant; or (c) the Annuity Start Date.
CHARGES
MORTALITY AND EXPENSE RISK CHARGE - We deduct daily from the net assets of each
Variable Account a Mortality and Expense Risk Charge equal to an annual rate of
1.25% of the average daily net assets. The Mortality and Expense Risk Charge is
to compensate us for the risk we assume that mortality and expenses will be
greater than estimated. This Charge is guaranteed by us and may not be
increased.
MONTHLY DEDUCTION - A Monthly Deduction is due on each Monthly Payment Date
prior to the Annuity Start Date and is equal to the sum of the following items:
- the monthly Administrative Charge, if any; and
- the monthly charge for any rider benefits.
The Monthly Deduction will be charged to each Variable Account and the Fixed
Account in proportion to the Accumulated value in these accounts on each Monthly
Payment Date.
ADMINISTRATIVE CHARGE - Beginning on the Contract Date and monthly thereafter
during the Accumulation period, there will be a charge equal to the
Administrative Charge multiplied by the Accumulated Value reduced by any
Contract Debt and any monthly charge for rider benefits. The Administrative
Charge is shown on the Contract Specifications pages. We reserve the right to
impose an Administrative Charge on any Contract on which it is currently waived,
and to increase the charge, but in no event will the Administrative Charge
imposed exceed the annual rate of 0.15%.
MAINTENANCE FEE - The maintenance fee, if any, will be deducted on each Contract
Anniversary, proportionately to the Accumulated Value in each Variable Account
and the Fixed Account during the Accumulation Period. At the time of any Full
Withdrawal or annuitization, the fee will be prorated for the portion of the
Contract Year that the Contract was in force. The annual maintenance fee is
shown on the Contract Specifications pages. We reserve the right to impose this
maintenance fee on any Contract on which it is currently waived, but in no event
will the annual fee exceed $30.00.
WITHDRAWAL CHARGE - No sales charges are deducted from the premium payments.
However a Withdrawal Charge, when applicable, may be assessed at the time of a
Partial or Full Withdrawal and, under certain instances, upon annuitization.
The amount of the Withdrawal Charge and when it is assessed is discussed below:
1. Order of withdrawal: To calculate the Withdrawal Charge, withdrawal
amounts will be applied to premiums in order the premiums are received.
Once all premiums have been
deemed withdrawn, additional amounts withdrawn will be applied to the
remaining Accumulated Value.
2. Free withdrawal amount: Starting with the second Contract Year, the
first withdrawal in each Contract Year of up to 10% of the sum of the
premiums paid during the current and the preceding four Contract Years
may be withdrawn without imposition of the Withdrawal Charge. This free
withdrawal privilege is noncumulative.
The amount of the Withdrawal Charge varies according to the number of Contract
Years each premium deemed withdrawn has remained credited to the Contract. To
determine the Age of the premium, the premium is considered Age 1 in the
Contract Year the premium is received and increases in Age each Contract
Anniversary thereafter. The Withdrawal Charge percentages for each Age applied
to any premiums deemed withdrawn are shown on the Contract Specifications pages.
No charge is assessed on amounts withdrawn applied to premium payments credited
to the Contract over five Contract Years.
If a Full Withdrawal is requested, or upon annuitization except as described
below, the Contract's Accumulated Value including any amount in the Loan
Account, less any maintenance fee due, will be considered in determining any
Withdrawal Charge that may be assessed.
The amount of the withdrawal proceeds and the Withdrawal Charge, if any, will be
allocated proportionately to the Accumulated Value in each Variable Account and
the Fixed Account unless otherwise requested by you.
No Withdrawal Charge will be imposed in the event of death. Upon annuitization,
a Charge may be imposed; however, no Withdrawal Charge will be imposed after the
first two Contract Years if:
- an Annuity Option under the Contract is elected and the annuity period
is five years or longer; or
- proceeds are applied to purchase any other annuity option then offered
by us and the annuity period is five years or longer.
In no event will the Withdrawal Charge assessed, when added to prior Withdrawal
Charges, ever exceed 6% of the total premiums paid.
PREMIUM TAX CHARGE - If applicable, any charge for premium taxes that a state or
local government charges us which is not refundable, will be deducted from your
Accumulated Value on the Annuity Start Date or if you request a Full Withdrawal.
Premium taxes currently range from 0% to 3%, but may be changed by a government
entity. We reserve the right to deduct premium taxes when due.
DELAY OF PAYMENTS
VARIABLE ACCOUNTS - We will pay death benefit proceeds, Full and Partial
Withdrawal proceeds, loan amounts, and proceeds on the Annuity Start Date based
on Accumulated Value in the Variable Accounts, and will effect a transfer
between Variable Accounts or from a Variable Account to the Fixed Account,
within seven days after we receive all the information needed to process a
payment or transfer.
However, we may postpone the processing or payment of such a payment or transfer
of amounts based on investment performance of the Variable Accounts if:
- The New York Stock Exchange is closed on other than customary weekend
and holiday closings or trading on the New York Stock Exchange is
restricted as determined by the Securities and Exchange Commission
(SEC); or
- An emergency exists, as determined by the SEC, as a result of which
disposal of securities is not reasonably practicable to determine the
value of the Account assets; or
- The SEC by order permits postponement for the protection of Contract
Owners.
FIXED ACCOUNT - As to amounts allocated to the Fixed Account, we may defer
payment of any Full or Partial Withdrawal proceeds or loan amounts, or defer
transfers from the Fixed Account for up to six months after we receive your
written request for it. We will credit interest, at a rate of at least 4%
annually, on any withdrawal proceeds or loan amounts derived from the Fixed
Account that we defer for 30 days or more. However, we will not defer payment of
any such amounts if they are to be used to pay premiums on any policies issued
by PM.
SEPARATE ACCOUNT PROVISIONS
SEPARATE ACCOUNT - We established the Separate Account and maintain it under the
laws of California. The Separate Account is divided into subaccounts, called
Variable Accounts. Realized and unrealized gains and losses from the assets of
each Variable Account are credited or charged against it without regard to our
other income, gains, or losses. Assets may be put in our Separate Account to
support this Contract and other variable annuity contracts. Assets may be put
in our Separate Account for other purposes, but not to support contracts other
than variable annuity contracts.
The assets of our Separate Account are our property. The portion of its assets
equal to the reserves and other Contract liabilities with respect to our
Separate Account will not be chargeable with liabilities arising out of any
other business we conduct. We may transfer assets of a Variable Account in
excess of the reserves and other liabilities with respect to that Account to
another Variable Account or to our general account. All obligations arising
under the Contract are general corporate obligations of PM. We do not hold
ourselves out to be trustees of the Separate Account assets.
VARIABLE ACCOUNTS - Each Variable Account may invest its assets in a separate
class of shares of a designated investment company or companies. The Variable
Accounts of our Separate Account that were available for your initial
allocations are shown on the Contract Specifications pages. The allocations
that you initially chose are shown on the copy of the application attached to
this Contract. From time to time we may make other Variable Accounts available
to you. We will provide you with written notice of all material details
including investment objectives and all charges.
We reserve the right, subject to compliance with the law then in effect, to:
- change or add designated investment companies;
- add, remove or combine Variable Accounts;
- add, delete or make substitutions for the securities that are held or
purchased by the Separate Account or any Variable Account;
- register or deregister the Separate Account under the Investment Company
Act of 1940;
- operate the Separate Account as a managed investment company;
- combine the assets of the Separate Account with other separate accounts
of PM or an affiliate thereof;
- run the Separate Account under the direction of a committee, boar or
other group;
- restrict or eliminate any voting rights of Contract Owners with respect
to the Separate Account, or other persons who have voting rights as to
the Separate Account. Also, unless required by law or regulation, an
investment Contract may not be changed without our consent; and
- comply with law.
If any of these changes result in a material change in the underlying
investments of a Variable Account of our Separate Account, we will notify you of
such change.
We will not change the investment policy of the Separate Account without the
approval of the insurance Commissioner in the State of California and without
following the filing and other procedures established by insurance regulators of
the state of issue, with whom the approval process is on file.
ANNUITY BENEFITS
If the Annuitant is living while this Contract is in force on the Annuity Start
Date, we will begin making periodic annuity payments to the Annuitant. We will
make these payments under the Annuity Option chosen by you. You may choose or
change an Annuity Option by making a written request at least 30 days prior to
the Annuity Start Date. Unless you have chosen otherwise, we will make payments
under Option 1 with payments certain for 10 years if a single Annuitant is
named. If Joint Annuitants are named, a joint and 50% last survivor annuity
under Option 3 will apply.
Before we pay any annuity benefits, we require the return of this Contract. If
the Contract is lost, we require a signed lost Contract form.
FREQUENCY - You choose the frequency of the annuity payments. This may be
monthly, quarterly, semi-annually or annually. If we do not receive written
notice from you, the payments will be made monthly. The amount of each payment
must be at least $50.00 we will change the frequency if it is less.
We may require proof that the payee is alive prior to making any payment. We
may also require proof of the payee's birthdate and sex, unless this Contract is
issued on a unisex basis, before making any payment under Options 1, 2 and 3.
While the Contrast is in force and before the Annuity Start Date, you may choose
an Annuity Option for the payment of death benefit proceeds. If, at the time of
the Annuitant's or Owner's death, no option has been chosen for paying the death
benefit proceeds, the Beneficiary, or Joint or Contingent Owner, or Owner
Beneficiary, as applicable, may choose an Annuity Option. You may also elect an
Annuity Option for payment of Partial Withdrawal or Full Withdrawal proceeds.
The proceeds, less any applicable charge for premium taxes, may also be used to
purchase any other annuity option then offered by us. We reserve the right to
pay any proceeds under the Contract in a lump sum if the proceeds are less than
$10,000.
Any proceeds applied towards an Annuity Option under the Contract, or any
annuity option then offered by us, will be transferred to our general account.
The general account contains all of our assets other than those allocated to the
Separate Account or to any other separate account of PM.
OPTION 1 - LIFE INCOME WITH GUARANTEED PAYMENT PERIOD - Proceeds may be applied
to provide payments in equal installments as long as the payee lives, with a
guaranteed payment period of 10 or 20 years, as elected. If the payee dies
during the guaranteed period chosen, payments will continue to be made to the
Beneficiary until the end of the period. The amount of the income will be based
on the payee's
Age and sex, unless unisex rates are applicable, and our purchase rates then in
effect. However, the monthly income purchased per $1000 will not be less than
that shown in the following table:
Xxxxx's Age on
Birthday
Nearest Annuity Life 10 Years Certain Life 20 Years Certain
Start Date Male Female Unisex Male Female Unisex
30 or less 3.90 3.76 3.88 3.88 3.75 3.86
31 3.93 3.78 3.90 3.91 3.77 3.88
32 3.96 3.81 3.93 3.94 3.80 3.91
33 3.99 3.83 3.96 3.97 3.82 3.94
34 4.02 3.86 3.99 3.99 3.84 3.97
35 4.06 3.88 4.02 4.03 3.87 4.00
36 4.09 3.91 4.06 4.06 3.89 4.03
37 4.13 3.94 4.09 4.09 3.92 4.06
38 4.17 3.97 4.13 4.12 3.95 4.09
39 4.21 4.00 4.17 4.16 3.98 4.13
40 4.25 4.03 4.21 4.20 4.01 4.16
41 4.30 4.07 4.25 4.24 4.04 4.20
42 4.34 4.10 4.30 4.28 4.07 4.24
43 4.39 4.14 4.35 4.32 4.11 4.28
44 4.45 4.18 4.40 4.36 4.15 4.32
45 4.50 4.23 4.45 4.41 4.19 4.36
46 4.56 4.27 4.50 4.45 4.23 4.41
47 4.61 4.32 4.56 4.50 4.27 4.46
48 4.68 4.37 4.62 4.55 4.31 4.50
49 4.74 4.42 4.68 4.60 4.36 4.55
50 4.81 4.48 4.74 4.65 4.40 4.61
51 4.88 4.53 4.81 4.71 4.45 4.66
52 4.95 4.59 4.88 4.76 4.50 4.71
53 5.03 4.66 4.96 4.82 4.56 4.77
54 5.11 4.73 5.04 4.88 4.61 4.83
55 5.20 4.80 5.12 4.94 4.67 4.89
56 5.29 4.87 5.21 5.00 4.73 4.95
57 5.38 4.95 5.30 5.06 4.79 5.01
58 5.49 5.04 5.40 5.12 4.85 5.07
59 5.59 5.13 5.50 5.18 4.92 5.13
60 5.71 5.22 5.61 5.24 4.98 5.20
61 5.82 5.32 5.73 5.31 5.05 5.26
62 5.95 5.42 5.85 5.37 5.12 5.32
63 6.08 5.54 5.97 5.43 5.18 5.38
64 6.22 5.65 6.11 5.48 5.25 5.44
65 6.36 5.78 6.25 5.54 5.32 5.50
66 6.50 5.91 6.39 5.59 5.39 5.56
67 6.66 6.04 6.54 5.64 5.45 5.61
68 6.82 6.19 6.70 5.69 5.52 5.66
69 6.98 6.34 6.86 5.73 5.58 5.71
70 7.14 6.50 7.02 5.77 5.63 5.75
71 7.31 6.67 7.19 5.81 5.69 5.79
72 7.48 6.85 7.37 5.84 5.74 5.82
73 7.66 7.03 7.54 5.87 5.78 5.85
74 7.83 7.22 7.72 5.89 5.82 5.88
Xxxxx's Age on
Birthday
Nearest Annuity Life 10 Years Certain Life 20 Years Certain
Start Date Male Female Unisex Male Female Unisex
75 8.01 7.41 7.90 5.91 5.85 5.90
76 8.18 7.60 8.07 5.93 5.88 5.92
77 8.35 7.80 8.25 5.95 5.91 5.94
78 8.51 8.00 8.42 5.96 5.93 5.96
79 8.67 8.20 8.58 5.97 5.95 5.97
80 8.82 8.39 8.74 5.98 5.96 5.98
81 8.96 5.57 8.89 5.99 5.97 5.98
82 9.09 8.75 9.03 5.99 5.98 5.99
83 9.21 8.92 9.16 5.99 5.99 5.99
84 9.33 9.07 9.28 6.00 5.99 6.00
85 or more 9.43 9.21 9.39 6.00 6.00 6.00
OPTION 2 - JOINT AND SURVIVOR - Proceeds may be applied to provide payments in
equal installments during the lifetime of the primary Annuitant and, after the
death of the primary Annuitant, in installments equal to 50%, 66-2/3%, or 100%
(as specified in the election) of the original payment to the secondary
Annuitant named in the election if and so long as such secondary Annuitant
lives. The amount of the income will be based on the Age and sex of both
Annuitants unless unisex rates are applicable, and our purchase rates then in
effect. However, the monthly income purchased per $1,000 will not be less than
that shown in the following table. The table shows monthly income amounts for
various five-year Age intervals and is based upon election of the 50%
survivorship payment option. Monthly payments for Ages, sex combinations, and
percentages not shown are available upon request.
Male Age
(Primary Annuitant)
60 65 70 75 80
60 5.28 5.68 6.14 6.66 7.20
65 5.42 5.89 6.44 7.05 7.70
Female Age 70 5.55 6.10 6.75 7.50 8.31
75 5.66 6.28 7.06 7.97 9.00
80 5.74 6.43 7.32 8.42 9.72
Unisex Age
(Primary Annuitant)
60 65 70 75 80
60 5.30 5.75 6.27 6.85 7.48
65 5.43 5.94 6.54 7.24 8.01
Unisex Age 70 5.53 6.11 6.82 7.66 8.61
75 5.61 6.25 7.06 8.06 9.23
80 5.66 6.35 7.25 8.41 9.83
OPTION 3 - JOINT AND LAST SURVIVOR - Proceeds may be applied to provide payments
in equal installments as long as both Joint Annuitants are living, with the
installment payments being equal to 50%, 66-2/3%, or 100% (as specified in the
election) of the original payment after one of the Joint Annuitants dies.
Payments will continue as long as the surviving Annuitant lives. The amount of
the income will be based on the age and sex of the Joint Annuitants, unless
unisex rates are applicable, and our purchase rates then in effect. However, the
monthly income purchased per $1,000 will not be less than shown in the following
table. The table shows monthly income amount for various five-year Age
intervals and is based upon election of the 50% survivorship payment option.
Monthly payments for Ages, sex combinations and percentages not shown are
available upon request.
Male Age
60 65 70 75 80
60 5.57 5.91 6.32 6.78 7.29
65 5.90 6.28 6.74 7.28 7.87
Female Age 70 6.31 6.75 7.29 7.91 8.62
75 6.82 7.34 7.98 8.74 9.60
80 7.43 8.05 8.83 9.77 10.86
Unisex Age
60 65 70 75 80
60 5.75 6.12 6.56 7.07 7.64
65 6.12 6.53 7.03 7.63 8.30
Unisex Age 70 6.56 7.03 7.62 8.32 9.13
75 7.07 7.63 8.32 9.17 10.15
80 7.64 8.30 9.13 10.15 11.38
OPTION 4 - FIXED PAYMENT FOR SPECIFIED PERIOD - Proceeds may be applied to
provide payments in equal installments for a specified period. If the payee
dies during the specified period, the discounted value of the remaining unpaid
payments based on the interest rate that we use to determine the amount of each
payment, will be paid to the Beneficiary. The amount of the income will be
based on the period elected and our purchase rates then in effect. However, the
monthly income purchased per $1,000 will not be less than that shown in the
following table:
FIXED FIXED FIXED FIXED
PERIOD MONTHLY PERIOD MONTHLY PERIOD MONTHLY PERIOD MONTHLY
YEARS INCOME YEARS INCOME YEARS INCOME YEARS INCOME
3 29.40 10 10.06 17 6.71 24 5.35
4 22.47 11 9.31 18 6.44 25 5.22
5 18.32 12 8.69 19 6.21 26 5.10
6 15.56 13 8.17 20 6.00 27 5.00
7 13.59 14 7.72 21 5.81 28 4.90
8 12.12 15 7.34 22 5.64 29 4.80
9 10.97 16 7.00 23 5.49 30 4.72
OPTION 5 - FIXED PAYMENT OF A SPECIFIC AMOUNT - Proceeds may be applied to
provide payments of the installment amount elected by you until the proceeds
applied and the interest thereon are exhausted. If the payee dies before all
guaranteed payments have been made, the discounted value of the remaining unpaid
payments, based on the interest rate that we use to determine the amount of each
payment, will be paid to the Beneficiary. The interest rate we use to determine
payments will be at least 4% annually.
Amounts shown for Options 1, 2 and 3 are based on the 1983 Table a, with
interest at 4%. Amounts shown for Option 4 are based on interest at 4%. You
may also choose to have proceeds paid under any other annuity option we then
offer. We will let you know what these are upon request.
INDEX
SUBJECT PAGE
Accumulated Value.................................................. 6
Administrative Charge.............................................. 11
Age................................................................ 4
Annuitant.......................................................... 3,4
Annuity Benefits................................................... 13-17
Annuity Start Date................................................. 4
Assignment......................................................... 5
Basis of Values.................................................... 5
Beneficiary........................................................ 4
Charges............................................................ 11
Compliance......................................................... 6
Contingent Annuitant............................................... 4
Contingent Owner................................................... 4
Contract Loans..................................................... 9
Contract Specification............................................. 3
Death Benefit...................................................... 10
Definitions........................................................ 4
Dividends.......................................................... 5
General Provisions................................................. 5
Interest........................................................... 8
Maintenance Fee.................................................... 11
Misstatement....................................................... 5
Monthly Deduction.................................................. 11
Mortality and Expense Risk Charge.................................. 11
Owner.............................................................. 3,5
Premium Allocation................................................. 6
Premium Limitation................................................. 6
Premiums........................................................... 6
Reports............................................................ 5
Separate Account................................................... 12,13
Transfers.......................................................... 8
Withdrawals........................................................ 8
Withdrawal Charge.................................................. 11
ENDORSEMENT
PREAUTHORIZED WITHDRAWAL FEATURE
This endorsement becomes a part of the Variable Annuity Contract (Form 90-53) to
which it is attached.
PREAUTHORIZED WITHDRAWAL FEATURE - You may request preauthorized Scheduled
Partial Withdrawals from your Contract during the Accumulation Period and after
the Free look Period while it is in force. All requests must be in writing.
Withdrawal payments will be deducted from your Accumulated Value. The
Withdrawals may be made either monthly, quarterly, semiannually or annually, and
may be stopped or modified upon written request received by us at least 30 days
in advance. Scheduled partial Withdrawals will be based on the Accumulated
Value at the end of the valuation period during which the Withdrawal is
scheduled. A Withdrawal Charge may be imposed on Scheduled Partial Withdrawals.
No Withdrawal Charge will be imposed on Scheduled Partial Withdrawal payments to
the extent your total withdrawals in the Contract Year during which the
Withdrawals are made do not exceed 10% of the sum of the premiums paid during
the current and the preceding four Contract Years.
Any time a Scheduled Partial Withdrawal is made, we will deduct from the
Accumulated Value the amount of the Withdrawal plus the applicable Withdrawal
Charge, if any. The deduction from the Accumulated Value will be made
proportionately to your Accumulated Value in each Variable Account and the Fixed
Account. Any charge for premium taxes that a state or other government charges
us as a result of the Withdrawal will be deducted from the Withdrawal proceeds.
The minimum amount for any preauthorized Scheduled Partial Withdrawal is $100.
We reserve the right at a future date to increase the minimum amount for any
Scheduled Partial Withdrawals, to impose or increase minimum remaining balances,
and to limit the number and frequency of requests for stopping or modifying
Scheduled Partial Withdrawals. Any Scheduled Partial Withdrawal that equals or
exceeds the Full Withdrawal Value will be treated as a Full Withdrawal. In no
event will the payment of a Scheduled Partial Withdrawal exceed the Full
Withdrawal Value, less any charge for premium taxes. The Contract will
automatically terminate if a Scheduled Partial Withdrawal causes the resulting
Full Withdrawal Value to equal zero.
We will pay Scheduled Partial Withdrawal proceeds within seven days after the
valuation period during which the Withdrawal is scheduled. However, we may
postpone the processing or payment of such payment based on the investment
performance of the Variable Accounts and defer payment of amounts allocated to
the Fixed Account in accordance with the Delay of Payments Section of your
Contract.
PACIFIC MUTUAL LIFE INSURANCE COMPANY
Chairman and Chief Executive Officer
E-9107
ENDORSEMENT
THIS ENDORSEMENT IS PART OF YOUR VARIABLE ANNUITY CONTRACT (FORM 90-53) AND
SHOULD BE ATTACHED TO IT.
The Death of Annuitant provision is hereby replaced by the following:
DEATH OF ANNUITANT -- We will pay the death benefit proceeds to the Beneficiary
if the Annuitant dies prior to the Annuity Start Date unless there is a
surviving Joint or Contingent Annuitant. In such event, the surviving Joint or
Contingent Annuitant becomes the Annuitant. The death benefit will be the
greater of (a) the Accumulated Value as of the Valuation Date due proof of death
and instructions regarding payment are received by PM; or (b) the total premiums
paid into the Contract less any deductions caused by previous Partial
Withdrawals; or (c) the Minimum Guaranteed Death Benefit for Contract Years six
and later. No Withdrawal Charge will be imposed. The death benefit proceeds
will be the death benefit reduced by the amount in the Loan Account, if any.
Payment will be made when we receive acceptable proof of death and instructions
regarding payment at our Home Office. Instead of a lump sum payment, the amount
of the death benefit proceeds, less any applicable charge for premium taxes, may
be applied towards an Annuity Option under this Contract or towards the purchase
of any other annuity option we then offer.
Minimum Guaranteed Death Benefit (MGDB) -- Starting in Contract Year six to
Contract Year eleven, the MGDB is the Accumulated Value at the fifth Contract
Anniversary, less any deductions caused by Partial Withdrawals and increased by
any premium payments received since the fifth Contract Anniversary. The MGDB is
adjusted on the tenth Contract Anniversary and each succeeding fifth Contract
Anniversary to the greater of the most recent MGDB or the Accumulated Value as
of such anniversary, and during the next following five year interval is
decreased by any deductions caused by Partial Withdrawals and increase by any
premium payments since such fifth Contract Anniversary. After the Contract year
in which the Annuitant reaches age 85, the MGDB will no longer be adjusted on
each fifth Contract anniversary, but it will still be adjusted for deductions
caused by Partial Withdrawals and for premium payments.
The Withdrawal Charge provision is hereby modified by adding the following
paragraph before the last paragraph of the provision.
No Withdrawal Charge will be imposed if the Annuitant has been diagnosed with a
medically determinable condition which results in a life expectancy of 12 months
or less. The following conditions must be met on or before the Withdrawal
request is made:
-- A request can be made anytime after the first Contract Anniversary.
-- The Contract must be in force on the date the request is approved.
-- We must receive written proof satisfactory to us that the Annuitant's
life expectancy is 12 months or less from the date of the written
request. Proof will include the certification by a licensed physician,
who is not yourself or a blood relative residing in the same household.
Such proof should include documentation supported by clinical,
radiological or laboratory evidence of the condition. We reserve the
right to obtain a second medical opinion from a physician of our choice
at our expense.
-- Owner or legal guardian must apply in writing for this benefit on a
form supplied by us.
-- Written consent from any assignee must be obtained.
PACIFIC MUTUAL LIFE INSURANCE COMPANY
Chairman and Chief Executive Officer
E-93-9053
