------
------ GOLDEN FLEXIBLE PREMIUM
--------
-------- AMERICAN DEFERRED COMBINATION
--------------
-------------- LIFE INSURANCE VARIABLE AND FIXED
-------
------- COMPANY ANNUITY CONTRACT
Golden American is a stock company domiciled in Delaware.
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Annuitant Owner
[XXXXXX X. XXX] [XXXX X. XXX]
--------------------------------------------------------------------------------
Initial Premium Annuity Option Annuity Commencement Date
[$10,000] [LIFE 10-YEAR CERTAIN] [JANUARY 1, 2026]
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Separate Account(s) Contract Number
[SEPARATE ACCOUNT B AND THE FIXED ACCOUNT] [123456]
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This is a legal Contract between its Owner and Us. In this Contract you or your
refers to the Owner shown above. We, our or us refers to Golden American Life
Insurance Company.
If this Contract is in force, we will make income payments to you starting on
the Annuity Commencement Date. If you die prior to the Annuity Commencement
Date, we will pay a death benefit to the Beneficiary. The amount of such benefit
is subject to the terms of this Contract.
ALL PAYMENTS AND VALUES, WHEN BASED ON THE INVESTMENT EXPERIENCE OF THE VARIABLE
SEPARATE ACCOUNT, MAY INCREASE OR DECREASE IN DOLLAR AMOUNT, DEPENDING ON THE
CONTRACT'S INVESTMENT RESULTS. ALL PAYMENTS AND VALUES BASED ON THE FIXED
ACCOUNT MAY BE SUBJECT TO A MARKET VALUE ADJUSTMENT, THE OPERATION OF WHICH MAY
CAUSE SUCH PAYMENTS AND VALUES TO INCREASE OR DECREASE. PROVISIONS REGARDING THE
VARIABLE NATURE OF THIS CONTRACT ARE FOUND ON PAGE 11.
RIGHT TO EXAMINE THIS CONTRACT: YOU MAY RETURN THIS CONTRACT TO US OR THE AGENT
THROUGH WHOM YOU PURCHASED IT WITHIN 10 DAYS AFTER YOU RECEIVE IT. IF SO
RETURNED, WE WILL TREAT THE CONTRACT AS THOUGH IT WERE NEVER ISSUED. UPON
RECEIPT WE WILL PROMPTLY REFUND THE ACCUMULATION VALUE, ADJUSTED FOR ANY MARKET
VALUE ADJUSTMENT, PLUS ANY CHARGES WE HAVE DEDUCTED AS OF THE DATE THE RETURNED
CONTRACT IS RECEIVED BY US.
Secretary:
Customer Service Center /s/ Xxxxx Xxxxxxx-Xxxxxxx
X.X. Xxx 0000
Xxx Xxxxxx, XX 00000-0000 President:
1-800-366-0066 /s/ Xxxxx Xxxxxx
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FLEXIBLE PREMIUM DEFERRED COMBINATION VARIABLE AND FIXED ANNUITY CONTRACT - NO
DIVIDENDS
Variable Cash Surrender Values while the Annuitant and Owner are living and
prior to the Annuity Commencement Date. Limited Additional Premium Payment
option. Death Benefit subject to guaranteed minimum. Partial Withdrawal Option.
Non-participating. Investment results reflected in values.
CONTRACT CONTENTS
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THE SCHEDULE
Payment and Investment Information.................................. 3A
Contract Facts...................................................... 3B
Charges and Fees.................................................... 3C
Income Plan Factors................................................. 3D
IMPORTANT TERMS..................................................... 4
INTRODUCTION TO THIS CONTRACT.......................................... 6
The Contract
The Owner
The Annuitant
The Beneficiary
Change of Owner or Beneficiary
PREMIUM PAYMENTS AND ALLOCATION CHANGES.................................. 8
Initial Premium Payment
Additional Premium Payments
Your Right to Change Allocation of
Accumulation Value
What Happens if a Variable Separate Account
Division is Not Available
Restricted Funds
Thresholds
Dollar Cap
Premium Threshold
Allocation Threshold
Thresholds - Effect on Withdrawals
Threshold Processing
HOW WE MEASURE THE CONTRACT'S
ACCUMULATION VALUE.................................................... 11
The General Account
The Variable Separate Accounts
Measurement of Investment Experience
Fixed Account
Valuation Period
Accumulation Value
Accumulation Value in each Division and
Fixed Allocation
Charges Deducted from Accumulation Value on
each Contract Processing Date
YOUR CONTRACT BENEFITS................................................... 17
Partial Withdrawal Option
Surrender Charge
Waiver of Surrender Charge
Cash Surrender Value
Proceeds Payable to the Beneficiary
BENEFIT OPTION PACKAGES.................................................. 19
Election of Benefit Option Packages
Description of Benefit Option Package I
Description of Benefit Option Package II
Description of Benefit Option Package III
CHOOSING AN INCOME PLAN.................................................. 28
Annuity Benefits
Annuity Commencement Date Selection
Frequency Selection
The Income Plan
The Annuity Options
Payment When Named Person Dies
OTHER IMPORTANT INFORMATION.............................................. 32
Sending Notice to Us
Reports to Owner
Assignment - Using this Contract as
Collateral Security
Contract Changes - Applicable Tax Law
Misstatement of Age or Sex
Non-Participating
Contestability
Payments We May Defer
Authority to Make Agreements
Required Note on Our Computations
Copies of any additional Riders and Endorsements are at the back of this
Contract.
THE SCHEDULE
The Schedule gives specific facts about this Contract and its coverage.
Please refer to the Schedule while reading this Contract.
2
GA-IA-1112
THE SCHEDULE
PAYMENT AND INVESTMENT INFORMATION
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Annuitant Owner
[XXXXXX X. XXX] [XXXX X. XXX]
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Annuitant's Issue Age Annuitant's Sex Owner's Issue Age
[55] [MALE] [35]
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Initial Premium Annuity Option Annuity Commencement Date
[$10,000] [LIFE 10-YEAR CERTAIN] [JANUARY 1, 2026]
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Contract Date Issue Date Residence Status
[JANUARY 1, 1996] [JANUARY 1, 1996] [DELAWARE]
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Schedule Date Benefit Option Package
[JANUARY 1, 1996] [II]
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Separate Account(s) Contract Number
[SEPARATE ACCOUNT B AND THE FIXED ACCOUNT] [123456]
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INITIAL INVESTMENT
Initial Premium Payment Recieved [$10,000]
Your initial Accumulation Value has been invested as follows:
Percentage of
Divisions Accumulation Value
--------- ------------------
[Liquid Asset Division [50%
Fixed Allocation 1 Year] 50%]
---------------------------------- ----------------------------
Total 100%
===== ====
3A1
GA-IA-1112
THE SCHEDULE
PAYMENT AND INVESTMENT INFORMATION (continued)
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Annuitant Owner
[XXXXXX X. XXX] [XXXX X. XXX]
--------------------------------------------------------------------------------
Annuitant's Issue Age Annuitant's Sex Owner's Issue Age
[55] [MALE] [35]
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Initial Premium Annuity Option Annuity Commencement Date
[$10,000] [LIFE 10-YEAR CERTAIN] [JANUARY 1, 2026]
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Contract Date Issue Date Residence Status
[JANUARY 1, 1996] [JANUARY 1, 1996] [DELAWARE]
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Schedule Date Benefit Option Package
[JANUARY 1, 1996] [II]
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Separate Account(s) Contract Number
[SEPARATE ACCOUNT B AND THE FIXED ACCOUNT] [123456]
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ADDITIONAL PREMIUM PAYMENT INFORMATION
We will accept additional Premium Payments until the earlier of: (a) 10
years following the Contract Date; or (b) either you or the Annuitant
reaches the Attained Age of 86.
If this Contract is issued as an XXX, no contributions may be made for the
taxable year in which you attain age 70 1/2 and thereafter (except for
rollover contributions).
The minimum additional payment which may be made is $50.00. Any additional
payment which would cause the Contract's Accumulation Value to exceed
$1,000,000 requires our prior approval.
GUARANTEED MINIMUM INTEREST RATE
The minimum interest rate which can be declared by us for allocations to
the General Account is an effective annual rate of 3.0%.
ALLOCATION CHANGES BY TELEPHONE
You may request allocation changes by telephone during our telephone
request business hours. You may call our Customer Service Center at
1-800-366-0066 to make allocation changes by using the personal
identification number you will receive. You may also mail any notice or
request for allocation changes to our Customer Service Center at the
address shown on the cover page.
3A2
GA-IA-1112
THE SCHEDULE
CONTRACT FACTS
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Annuitant Owner
[XXXXXX X. XXX] [XXXX X. XXX]
--------------------------------------------------------------------------------
Initial Premium Annuity Option Annuity Commencement Date
[$10,000] [LIFE 10-YEAR CERTAIN] [JANUARY 1, 2026]
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Separate Account(s) Contract Number
[SEPARATE ACCOUNT B AND THE FIXED ACCOUNT] [123456]
--------------------------------------------------------------------------------
CONTRACT FACTS
Contract Processing Date
The Contract Processing Date for your Contract is [April 1] of each year.
Specially Designated Division
When a distribution is made from an investment portfolio underlying a
Separate Account Division in which reinvestment is not available, we will
allocate the amount of the distribution to the [Liquid Asset Division], or
its successor, unless you specify otherwise.
Benefit Option Package
Benefit Option Package [II] was selected.
OPTIONAL BENEFIT RIDERS
[Premium Credit Rider]
SPECIAL FUNDS
[GCG Core Bond Series, GCG Liquid Asset Portfolio, Fixed Account]
EXCLUDED FUNDS
[None]
RESTRICTED FUNDS
[None]
RESTRICTED FUND LIMITS
Maximum
Allocation % of Maximum
Accumulation Value Premium % Dollar Cap
------------------ --------- ----------
[30%] [99.999%] [$9,999,999]
3B
GA-IA-1112
THE SCHEDULE
CHARGES AND FEES
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Annuitant Owner
[XXXXXX X. XXX] [XXXX X. XXX]
--------------------------------------------------------------------------------
Initial Premium Annuity Option Annuity Commencement Date
[$10,000] [LIFE 10-YEAR CERTAIN] [JANUARY 1, 2026]
--------------------------------------------------------------------------------
Separate Account(s) Contract Number
[SEPARATE ACCOUNT B AND THE FIXED ACCOUNT] [123456]
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DEDUCTIONS FROM PREMIUMS
None
DEDUCTIONS FROM ACCUMULATION VALUE
Initial Administrative Charge
None
Administrative Charge
We charge a maximum of $30 to cover a portion of our ongoing administrative
expenses for each Contract Processing Period. The charge is incurred at the
beginning of the Contract Processing Period and deducted on the Contract
Processing Date at the end of the period. At the time of deduction, this
charge will be waived if: (1) The Accumulation Value is at least $50,000;
or (2) The sum of premiums paid to date is at least $50,000
Excess Allocation Charge
[$25.] Any charge will be deducted in proportion to the amount being
transferred from each Division or Fixed Allocation.
Premium Taxes
We deduct the amount of any premium or other state and local taxes levied
by any state or governmental entity when such taxes are incurred. We
reserve the right to defer collection of premium taxes until the Contract
is surrendered or until application of the Contract's Accumulation Value to
an Income Plan. An Excess Partial Withdrawal will result in the deduction
of any premium tax then due us on such amount. We reserve the right to
change the amount we charge for premium taxes on future Premium Payments to
conform with changes in the law or if you change your state of residence.
Surrender Charge
Complete Years Elapsed
Since Premium Payment 0 1 2 3 4 5 6 7+
---------------------------------------------------------------------------
Surrender Charges 7% 7% 6% 6% 5% 4% 3% 0%
3C1
GA-IA-1112
THE SCHEDULE
CHARGES AND FEES (continued)
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Annuitant Owner
[XXXXXX X. XXX] [XXXX X. XXX]
--------------------------------------------------------------------------------
Initial Premium Annuity Option Annuity Commencement Date
[$10,000] [LIFE 10-YEAR CERTAIN] [JANUARY 1, 2026]
--------------------------------------------------------------------------------
Separate Account(s) Contract Number
[SEPARATE ACCOUNT B AND THE FIXED ACCOUNT] [123456]
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Deductions from the Divisions
MORTALITY AND EXPENSE RISK CHARGE - We deduct a charge from the assets in
each Variable Separate Account Division on a daily basis for mortality and
expense risks. The charge is not deducted from the Fixed Account or General
Account values. Prior to the Annuity Commencement Date, the Mortality and
Expense Risk Charge varies by Benefit Option Package selected by you, as
follows:
-----------------------------------------------------------------
Benefit Option The Maximum Daily Equivalent to an Annual
Package Selected: Charge Is: Maximum Rate of:
-----------------------------------------------------------------
I [0.003030%] [1.10%]
-----------------------------------------------------------------
II [0.003585%] [1.30%]
-----------------------------------------------------------------
III [0.004002%] [1.45%]
-----------------------------------------------------------------
After the Annuity Commencement Date, the maximum daily Mortality and
Expense Risk Charge will be [0.004141%] (equivalent to an annual maximum
rate of [1.50%]), regardless of Benefit Option Package.
ASSET BASED ADMINISTRATIVE CHARGE - We deduct a charge of not more than
[0.000411]% of the assets in each Variable Separate Account Division on a
daily basis (equivalent to an annual maximum rate of [0.15]%) to compensate
us for a portion of our ongoing administrative expenses. This charge is not
deducted from the Fixed Account or General Account values.
CHARGE DEDUCTION DIVISION
If elected by you, all charges against the Accumulation Value in this
Contract will be deducted from the [Liquid Asset Division], or its
successor.
3C2
GA-IA-1112
THE SCHEDULE
INCOME PLAN FACTORS
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Annuitant Owner
[XXXXXX X. XXX] [XXXX X. XXX]
--------------------------------------------------------------------------------
Initial Premium Annuity Option Annuity Commencement Date
[$10,000] [LIFE 10-YEAR CERTAIN] [JANUARY 1, 2026]
--------------------------------------------------------------------------------
Separate Account(s) Contract Number
[SEPARATE ACCOUNT B AND THE FIXED ACCOUNT] [123456]
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Values for other payment periods, ages or joint life combinations are
available on request. Monthly payments are shown for each $1,000 applied
based on the Annuity 2000 Mortality Table.
OPTION 1: INCOME FOR A FIXED PERIOD
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Rates for Fixed Annuity Payments with a 3% Guaranteed Interest Rate
--------------------------------------------------------------------------------
Years Income Years Income Years Income
5 17.95 14 7.28 23 5.00
6 15.18 15 6.89 24 4.85
7 13.20 16 6.54 25 4.72
8 11.71 17 6.24 26 4.60
9 10.56 18 5.98 27 4.49
10 9.64 19 5.74 28 4.38
11 8.88 20 5.53 29 4.28
12 8.26 21 5.33 30 4.19
13 7.73 22 5.16
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Rates for Variable Annuity Payments with a 3.5% Assumed Interest Rate (AIR)
--------------------------------------------------------------------------------
Years Income Years Income Years Income
5 18.17 14 7.51 23 5.25
6 15.39 15 7.12 24 5.11
7 13.41 16 6.78 25 4.98
8 11.93 17 6.48 26 4.86
9 10.78 18 6.22 27 4.75
10 9.86 19 5.98 28 4.64
11 9.11 20 5.77 29 4.55
12 8.49 21 5.58 30 4.46
13 7.96 22 5.41
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Rates for Variable Annuity Payments with a 5% Assumed Interest Rate (AIR)
--------------------------------------------------------------------------------
Years Income Years Income Years Income
5 18.82 14 8.23 23 6.04
6 16.05 15 7.85 24 5.91
7 14.08 16 7.52 25 5.78
8 12.61 17 7.23 26 5.67
9 11.46 18 6.97 27 5.56
10 10.55 19 6.74 28 5.47
11 9.81 20 6.54 29 5.38
12 9.19 21 6.36 30 5.30
13 8.67 22 6.19
3D1
GA-IA-1112
THE SCHEDULE
INCOME PLAN FACTORS (continued)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Annuitant Owner
[XXXXXX X. XXX] [XXXX X. XXX]
--------------------------------------------------------------------------------
Initial Premium Annuity Option Annuity Commencement Date
[$10,000] [LIFE 10-YEAR CERTAIN] [JANUARY 1, 2026]
--------------------------------------------------------------------------------
Separate Account(s) Contract Number
[SEPARATE ACCOUNT B AND THE FIXED ACCOUNT] [123456]
--------------------------------------------------------------------------------
OPTION 2: INCOME FOR LIFE (SINGLE ANNUITANT)
--------------------------------------------------------------------------------
Rates for Fixed Annuity Payments with a 3% Guaranteed Interest Rate
--------------------------------------------------------------------------------
Option 2(b) Option 2(b) Option 2(c)
Adjusted 10 Years Certain 20 Years Certain Refund Certain
Age Male/Female Male/Female Male/Female
50 $4.06/3.83 $3.96/3.77 $3.93/3.75
55 4.43/4.14 4.25/4.05 4.25/4.03
60 4.90/4.56 4.57/4.37 4.66/4.40
65 5.51/5.10 4.90/4.73 5.12/4.83
70 6.26/5.81 5.18/5.07 5.76/5.42
75 7.11/6.70 5.38/5.33 6.58/6.19
80 7.99/7.70 5.48/5.46 7.69/7.21
85 8.72/8.59 5.52/5.51 8.72/8.59
90 9.23/9.18 5.53/5.53 10.63/10.53
--------------------------------------------------------------------------------
Rates for Variable Annuity Payments with a 3.5% Assumed Interest Rate (AIR)
--------------------------------------------------------------------------------
Option 2(b) Option 2(b)
Adjusted 10 Years Certain 20 Years Certain
Age Male/Female Male/Female
50 4.36/4.12 4.25/4.06
55 4.72/4.43 4.53/4.33
60 5.18/4.84 4.84/4.64
65 5.79/5.37 5.16/4.99
70 6.53/6.08 5.44/5.33
75 7.38/6.96 5.62/5.58
80 8.23/7.95 5.72/5.71
85 8.96/8.83 5.76/5.76
90 9.46/9.41 5.77/5.77
--------------------------------------------------------------------------------
Rates for Variable Annuity Payments with a 5% Assumed Interest Rate (AIR)
--------------------------------------------------------------------------------
Option 2(b) Option 2(b)
Adjusted 10 Years Certain 20 Years Certain
Age Male/Female Male/Female
50 5.28/5.04 5.15/4.98
55 5.62/5.33 5.41/5.22
60 6.06/5.72 5.69/5.50
65 6.65/6.23 5.98/5.82
70 7.36/6.91 6.23/6.13
75 8.17/7.77 6.40/6.36
80 9.00/8.72 6.49/6.48
85 9.69/9.56 6.53/6.53
90 10.17/10.12 6.54/6.54
3D2
GA-IA-1112
IMPORTANT TERMS
--------------------------------------------------------------------------------
ACCUMULATION VALUE - The amount that a Contract provides for investment at any
time. Initially, this amount is equal to the premium paid.
ANNUITANT - The person designated by you to be the measuring life in determining
Annuity Payments.
ANNUITY COMMENCEMENT DATE - The date on which Annuity Payments begin.
ANNUITY OPTIONS - Options you select that determine the form and amount of
Annuity Payments.
ANNUITY PAYMENT - The periodic payment you receive.
ATTAINED AGE - Your age, or that of the Annuitant, on the Contract Issue Date
plus the number of full years elapsed since the Contract Date.
BENEFICIARY - The person designated to receive benefits in the case of your
death.
BUSINESS DAY - Any day the New York Stock Exchange ("NYSE") is open for trading,
exclusive of federal holidays, or any day on which the Securities and
Exchange Commission ("SEC") requires that mutual funds, unit investment
trusts or other investment portfolios be valued.
CASH SURRENDER VALUE - The amount you receive upon surrender of the Contract.
CONTRACT ANNIVERSARY - The anniversary of the Contract Date.
CONTRACT DATE - The date we received the initial premium and upon which we begin
determining the Contract values. It may not be the same as the Contract
Issue Date. This date is used to determine Contract months, processing
dates, years, and anniversaries.
CONTRACT ISSUE DATE - The date the Contract is issued at our Customer Service
Center.
CONTRACT PROCESSING DATES - The days when we deduct certain charges from the
Accumulation Value. If the Contract Processing Date is not a Valuation
Date, it will be on the next succeeding Valuation Date. The Contract
Processing Date will be on the Contract Anniversary of each year.
CONTRACT PROCESSING PERIOD - The period between successive Contract Processing
Dates unless it is the first Contract Processing Period. In that case, it
is the period from the Contract Date to the first Contract Processing Date.
CONTRACT YEAR - The period between Contract Anniversaries.
CHARGE DEDUCTION DIVISION - The Division from which all charges are deducted if
so designated or elected by you.
CONTINGENT ANNUITANT - The person designated by you who, upon the Annuitant's
death prior to the Annuity Commencement Date, becomes the Annuitant.
CREDIT(S) - An amount added by us to the Accumulation Value. Credits, if any,
are applied based on the terms and conditions of an optional premium credit
rider which may be elected by you and attached to this Contract.
4
GA-IA-1112
IMPORTANT TERMS (continued)
--------------------------------------------------------------------------------
EXPERIENCE FACTOR - The factor which reflects the investment experience of the
portfolio in which a Variable Separate Account Division invests as well as
the charges assessed against the Division for a Valuation Period.
FIXED ACCOUNT - This is the Separate Account established to support Fixed
Allocations.
FIXED ALLOCATION - An amount allocated to the Fixed Account that is credited
with a specified interest rate for a specific Guarantee Period.
GENERAL ACCOUNT - An account which contains all of our assets other than those
held in our separate accounts.
GUARANTEE PERIOD - The period of years a specified interest rate is guaranteed
to be credited to a Fixed Allocation or allocations to available Guaranteed
Interest Divisions of the General Account.
GUARANTEED INTEREST DIVISION - A Division of the General Account which we may,
from time to time, make available for allocations of Premium Payments or
Accumulation Value which we credit with fixed rates of interest for
specific Guarantee Periods.
GUARANTEED INTEREST RATE - The effective annual interest rate which we will
credit for a specified Guarantee Period.
GUARANTEED MINIMUM INTEREST RATE - The minimum interest rate which can be
declared by us for allocations to a Guaranteed Interest Division. The
Guaranteed Minimum Interest Rate is shown in the Schedule.
ISSUE AGE - Your age, or that of the Annuitant, on the last birthday on or
before the Contract Date.
MARKET VALUE ADJUSTMENT - A positive or negative adjustment to a Fixed
Allocation. It may apply if all or part of a Fixed Allocation is withdrawn,
transferred, or applied to an Income Plan prior to the end of the Guarantee
Period.
MATURITY DATE - The date on which a Guarantee Period matures. The Maturity Date
of a Guarantee Period will be on the last day of the calendar month in
which the Guarantee Period ends.
OWNER- The person who owns this Contract and is entitled to exercise all rights
of the Contract. This person's death also initiates payment of the Death
Benefit. "You" and "Your" refer to the Owner.
SCHEDULE DATE - The date on which the Benefit Option Package takes effect. On
the Contract Issue Date, the Schedule Date is the same as the Contract
Date. Thereafter, if you elect to replace the then current Benefit Option
Package with another available Benefit Option Package, the Schedule Date
will be the effective date of the change.
SPECIALLY DESIGNATED DIVISION - The Division shown in the Schedule to which
distributions from an investment portfolio underlying a Separate Account
Division in which reinvestment is not available will be allocated, unless
you specify otherwise.
VALUATION DATE - The day at the end of a Valuation Period when each Division is
valued.
VALUATION PERIOD - Each business day together with any non-business days before
it.
VARIABLE SEPARATE ACCOUNT DIVISION - An investment option available in the
Variable Separate Account.
5
GA-IA-1112
INTRODUCTION TO THIS CONTRACT
--------------------------------------------------------------------------------
THE CONTRACT
This is a legal Contract between you and us. We provide benefits as stated
in this Contract. In return, you supply us with the Initial Premium Payment
required to put this Contract in effect. This Contract, together with any
attached Riders or Endorsements, constitutes the entire Contract. Riders
and Endorsements add provisions or change the terms of the basic Contract.
Riders and Endorsements added to comply with applicable tax law do not
require your consent, but are subject to regulatory approval.
THE OWNER
You are the Owner of this Contract. You are also the Annuitant unless
another Annuitant has been named by you and is shown in the Schedule. You
have the rights and options described in this Contract, including but not
limited to the right to receive the Annuity Benefits on the Annuity
Commencement Date.
One or more people may own this Contract. If there are multiple Owners
named, the age of the oldest Owner will be used to determine the applicable
Death Benefit. In the case of a sole Owner who dies prior to the Annuity
Commencement Date, we will pay the Beneficiary the Death Benefit then due.
If the sole Owner is not an individual, we will treat the Annuitant as
Owner for the purpose of determining when the Owner dies under the Death
Benefit provision (if there is no Contingent Annuitant), and the
Annuitant's age will determine the applicable Death Benefit payable to the
Beneficiary. The sole Owner's estate will be the Beneficiary if no
Beneficiary designation is in effect, or if the designated Beneficiary has
predeceased the Owner. In the case of a joint Owner dying prior to the
Annuity Commencement Date, the surviving Owner(s) will be deemed to be the
Beneficiary(ies) and any other Beneficiary(ies) on record will be treated
as the contingent Beneficiary(ies).
THE ANNUITANT
The Annuitant is the measuring life of the Annuity Benefits provided under
this Contract. The Annuitant must be a natural person. You may name a
Contingent Annuitant. The Annuitant may not be changed during the
Annuitant's lifetime.
If the Annuitant dies prior to the Annuity Commencement Date, the
Contingent Annuitant becomes the Annuitant. If no Contingent Annuitant has
been named, we will allow you sixty days to designate someone other than
yourself as the Annuitant. You will be the Contingent Annuitant unless you
name someone else. If all Owners are not individuals and, through the
operation of this provision, an Owner becomes the Annuitant, we will pay
the death proceeds to the Beneficiary. If there are joint Owners, we will
treat the youngest of the Owners as the Contingent Annuitant designated,
unless you elect otherwise.
THE BENEFICIARY
The Beneficiary is the person to whom we pay death proceeds if any Owner
dies prior to the Annuity Commencement Date. See "Proceeds Payable to the
Beneficiary" for more information. We pay death proceeds to the primary
Beneficiary (unless there are joint Owners in which case the Death Benefit
proceeds are payable to the surviving Owner). If the primary Beneficiary
dies before the Owner, the death proceeds are paid to the Contingent
Beneficiary, if any. If there is no surviving Beneficiary, we pay the death
proceeds to the Owner's estate.
One or more persons may be named as primary Beneficiary or contingent
Beneficiary. In the case of more than one Beneficiary, we will assume any
death proceeds are to be paid in equal shares to the surviving
Beneficiaries. You may specify other than equal shares.
6
GA-IA-1112
INTRODUCTION TO THIS CONTRACT (continued)
--------------------------------------------------------------------------------
You have the right to change Beneficiaries, unless you designate the
primary Beneficiary irrevocable. When an irrevocable Beneficiary has been
designated, you and the irrevocable Beneficiary may have to act together to
exercise the rights and options under this Contract.
When naming or changing the Beneficiary(ies), you may specify the form of
payments of the Death Benefits. We will honor the specified form of payment
to the extent permitted under Section 72(s) of the Internal Revenue Code.
If the form of payment is not specified, the Beneficiary(ies) may determine
the manner of payment, to the extent allowed by the Code.
CHANGE OF OWNER OR BENEFICIARY
During your lifetime and while this Contract is in effect you may transfer
ownership of this Contract or change the Beneficiary. To make any of these
changes, you must send us written notice of the change in a form
satisfactory to us. If there are joint Owners, both must agree to the
change. The change will take effect as of the day the notice is signed. The
change will not affect any payment made or action taken by us before
recording the change at our Customer Service Center. A Change of Owner may
affect the amount of Death Benefit payable under this Contract. See
"Proceeds Payable to Beneficiary" and "Benefit Option Packages" for more
information.
7
GA-IA-1112
PREMIUM PAYMENTS AND ALLOCATION CHANGES
--------------------------------------------------------------------------------
INITIAL PREMIUM PAYMENT
The Initial Premium Payment is required to put this Contract in effect. The
amount of the Initial Premium Payment is shown in the Schedule.
ADDITIONAL PREMIUM PAYMENTS
You may make additional Premium Payments under this Contract after the end
of the Right to Examine period. Restrictions on additional Premium
Payments, such as the Attained Age of the Annuitant or Owner, the period
during which we will accept additional premium payments and the timing and
amount of each payment, are shown in the Schedule. We reserve the right to
accept additional premium payments beyond the period stated in the
Schedule, or to defer acceptance of or to return any additional Premium
Payments if they exceed the restrictions stated in the Schedule, if a
Division or Fixed Allocation to which they are allocated is closed, or in
order to comply with any law or regulation.
As of the date we receive and accept your additional Premium Payment:
(1) The Accumulation Value will increase by the amount of the Premium
Payment less any premium deductions shown in the Schedule.
(2) The increase in the accumulation value will be allocated among
the Divisions and the Fixed Account in accordance with your
instructions. If you do not provide such instructions, allocation
will be among the Divisions in proportion to the amount of
accumulation value in each Division as of the date we receive and
accept the additional premium payment. Allocations to the Fixed
Account will be made only upon specific written request.
Where to Make Payments
Remit the Premium Payments to our Customer Service Center at the address
shown on the cover page. On request we will give you a receipt signed by
our treasurer.
YOUR RIGHT TO CHANGE ALLOCATION OF ACCUMULATION VALUE
You may change the allocation of the Accumulation Value among the available
Divisions of the Variable Separate Account, the General Account, and the
Fixed Account after the end of the Right to Examine period. Prior to the
Annuity Commencement Date, allocation changes in excess of twelve in any
Contract Year are subject to the Excess Allocation Charge stated in the
Schedule. After the Annuity Commencement Date, allocation changes in excess
of four in any Contract Year are subject to the Excess Allocation Charge
stated in the Schedule. After Annuity Payments begin under this Contract,
allocation changes are not allowed between values providing Fixed Annuity
Payments and Variable Annuity Payments. To make an allocation change, you
must provide us with satisfactory notice at our Customer Service Center.
The change will take effect when we receive the notice. An allocation from
the Fixed Account may be subject to a Market Value Adjustment.
Limitation of Allocations
We reserve the right to restrict allocations into and out of the General
Account. Such limits may be dollar restrictions on allocations into the
General Account or we may restrict reallocations into the General Account.
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PREMIUM PAYMENTS AND ALLOCATION CHANGES (continued)
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WHAT HAPPENS IF A VARIABLE SEPARATE ACCOUNT DIVISION IS NOT AVAILABLE
When a distribution is made from an investment portfolio supporting a unit
investment trust Separate Account Division in which reinvestment is not
available, we will allocate the distribution to the Specially Designated
Division shown in the Schedule unless you specify otherwise. Such a
distribution may occur when an investment portfolio or Division matures,
when distribution from a portfolio or Division cannot be reinvested in the
portfolio or Division due to the unavailability of securities, or for other
reasons. When this occurs because of maturity, we will send written notice
to you thirty days in advance of such date. To elect an allocation to other
than the Specially Designated Division shown in the Schedule, you must
provide satisfactory notice to us at least seven days prior to the date the
investment matures. Such allocations will not be counted as an allocation
change of the Accumulation Value for purposes of the number of free
allocations permitted.
RESTRICTED FUNDS
Restricted Funds are subject to limits as to amounts which may be invested
or transferred into such Divisions. The designation of a Division as a
Restricted Fund may be changed upon 30 days notice to the Owner with regard
to future transfers and Premium Payments into such Division. When a new
Division is made available it may be designated as a Restricted Fund. If so
designated, the rules regarding its restrictions will be sent to you. The
total Contract limits which apply to Restricted Funds available under this
Contract, if any, are shown in the Schedule.
Thresholds
Each Restricted Fund has one or more thresholds at which point no further
amounts may be allocated to that Division. Compliance with a threshold is
verified whenever there is a transaction initiated which is subject to such
threshold (Premium Payments, transfers, withdrawals). A threshold is
applied to the total Accumulation Value of each Restricted Fund. Thresholds
may be changed by us for new premiums, transfers or withdrawals by
Restricted Fund upon 30 day notice to you.
Dollar Cap
The Dollar Cap is the dollar amount at which no further Accumulation Value
may be added to Restricted Funds.
Premium Threshold
The threshold for premium by Restricted Fund limits the amount of any
premium which may be allocated to that Division. Should a request for
allocation to a Restricted Fund exceed the limit in effect for that
Division or for the Contract, any excess over that amount shall be
allocated prorata to any non-Restricted Fund(s) in which the Contract is
then invested. Should the Contract not be invested in other non-Restricted
Funds, the excess will be invested in the Specially Designated Division
unless we receive written instructions to do otherwise. Premium allocations
must also satisfy the Allocation Threshold.
Allocation Threshold
Allocations into a Restricted Fund are limited to that amount such that the
Accumulation Value in that Restricted Fund after such allocation does not
exceed the threshold for that Division and does not cause the Contract's
total limit on allocation to Restricted Funds to be exceeded. If the amount
of an allocation would cause either limit to be exceeded, the allocation
will only be executed to the extent the lower limit would allow.
Allocations from a Restricted Fund will be allowed even if the amount
remaining in the Restricted Fund after an allocation exceeds the Allocation
Threshold. If a program of allocations over time is authorized by us,
verification of the threshold will be performed at the initiation of such
program. If such program is modified at a later date, a testing of
thresholds will be done at that time.
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PREMIUM PAYMENTS AND ALLOCATION CHANGES (continued)
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Thresholds - Effect on Withdrawals
If a withdrawal is requested while any Accumulation Value is allocated to
Restricted Funds and the Allocation Threshold percentage is currently
exceeded, the percentage for funds invested in Restricted Funds for the
total Contract, after taking into account the withdrawal, may not be higher
than prior to the withdrawal. Should the calculated effect of a withdrawal
result in the total Contract threshold being exceeded, the excess portion
of the withdrawal will be processed prorata from all Variable Divisions.
Systematic withdrawals, while the Contract has investments in Restricted
Funds, if not withdrawn prorata from all Divisions, shall be monitored
annually to assure threshold compliance. Should the effect of such
withdrawals cause a Restricted Fund to exceed its threshold, the Divisions
from which the withdrawals are processed may be adjusted to assure that the
percentage of Accumulation Value in the Restricted Funds does not increase
Threshold Processing
For the purpose of calculating any thresholds, the values for the Divisions
will be determined using the prior day's closing Index of Investment
Experience.
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HOW WE MEASURE THE CONTRACT'S ACCUMULATION VALUE
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THE GENERAL ACCOUNT
The General Account contains all assets of the Company other than those in
the Separate Account(s) we establish. We may, from time to time, make
available for allocations of Premium Payments or Accumulation Value under
this Contract specific Divisions of the General Account (Guaranteed
Interest Divisions ) which we credit with fixed rates of interest declared
by us for the then available Guarantee Period(s). Any declaration will be
by class and will be based solely on our expectations of future earnings,
but will never be less than the Guaranteed Minimum Interest Rate shown in
the Schedule. We may periodically guarantee higher rates for specific
Guarantee Periods based on our sole discretion. Such rates will apply to
periods following the date of declaration. Interest will be credited daily
at a rate to yield the declared annual Guaranteed Interest Rate.
Guarantee Periods
We may offer any number of Guarantee Periods and may, from time to time,
change the Guarantee Periods available. Any change in the Guarantee Periods
available under the Contract will not affect existing Allocations in a
Guarantee Period until the Guarantee Period Maturity Date. The Guaranteed
Interest Rates for an Allocation to a Guaranteed Interest Division are
effective for the entire period.
Transfers from the General Account
We currently require that amounts allocated to the General Account not be
transferred until the Maturity Date of the applicable Guarantee Period. We
reserve the right not to allow amounts previously transferred from the
General Account to the Variable Separate Account or Fixed Account to be
transferred back to the General Account for a period of at least six months
from the date of transfer.
THE VARIABLE SEPARATE ACCOUNT
The variable Annuity Benefits under this Contract are provided through
investments which may be made in our Separate Account (the "Account"), a
unit investment trust Separate Account, organized in and governed by the
laws of the State of Delaware, our state of Domicile. The Account is
divided into Divisions, each of which is available for investment under
this Contract.
The Account is kept separate from our General Account and any other
Separate Accounts we may have. It is used to support Variable Annuity
Contracts and may be used for other purposes permitted by applicable laws
and regulations. We own the assets in the Separate Account. Assets equal to
the reserves and other liabilities of the account will not be charged with
liabilities that arise from any other business we conduct; but, we may
transfer to our General Account assets which exceed the reserves and other
liabilities of the Variable Separate Account. Income and realized and
unrealized gains or losses from assets in the Variable Separate Account are
credited to or charged against the Account without regard to other income,
gains or losses in our other investment accounts.
The Variable Separate Account will invest in mutual funds, unit investment
trusts and other investment portfolios which we determine to be suitable
for this Contract's purposes. The Variable Separate Account is treated as a
unit investment trust under Federal securities laws. It is registered with
the Securities and Exchange Commission ("SEC") under the Investment Company
Act of 1940. The Variable Separate Account is also governed by state law as
described above.
Variable Separate Account Divisions
A unit investment trust Separate Account is divided into Divisions, each
investing in a designated investment portfolio. The Divisions and the
investment portfolios designated may be managed by a separate investment
adviser. Such adviser may be registered under the Investment Advisers Act
of 1940.
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HOW WE MEASURE THE CONTRACT'S ACCUMULATION VALUE (continued)
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Changes within the Variable Separate Account
We may, from time to time, make additional Variable Separate Account
Divisions available to you. These Divisions will invest in investment
portfolios we find suitable for this Contract. We also have the right to
eliminate Divisions from a Variable Separate Account, to combine two or
more Divisions or to substitute a new portfolio for the portfolio in which
a Division invests. A substitution may become necessary if, in our
judgment, a portfolio or Division no longer suits the purpose of this
Contract. This may happen due to a change in laws or regulations, a change
in a portfolio's investment objectives or restrictions, because the
portfolio or Division is no longer available for investment, or for some
other reason. We will obtain any required regulatory approvals before
making such a substitution
Subject to any required regulatory approvals, we reserve the right to
transfer assets of the Variable Separate Account which we determine to be
associated with the class of contracts to which this Contract belongs, to
another Variable Separate Account or Division.
When permitted by law, we reserve the right to:
(1) deregister a Variable Separate Account under the Investment
Company Act of 1940;
(2) operate a Variable Separate Account as a management company under
the Investment Company Act of 1940, if it is operating as a unit
investment trust;
(3) operate a Variable Separate Account as a unit investment trust
under the Investment Company Act of 1940, if it is operating as a
managed Variable Separate Account;
(4) restrict or eliminate any voting rights of Owners, or other
persons who have voting rights to a Variable Separate Account;
and
(5) combine a Variable Separate Account with other Variable Separate
Accounts.
MEASUREMENT OF INVESTMENT EXPERIENCE
Index of Investment Experience
The Index of Investment Experience is the index that measures the
performance of a Variable Separate Account Division. The investment
experience of a Variable Separate Account Division is determined on each
Valuation Date. We use an Index to measure changes in each Division's
experience during a Valuation Period. We set the Index at $10 when the
first investments in a Division are made. The Index for a current Valuation
Period equals the Index for the preceding Valuation Period multiplied by
the Experience Factor for the current Valuation Period.
How We Determine the Experience Factor (Net Return Factor)
For Divisions of a unit investment trust Separate Account, the Experience
Factor reflects the Investment Experience of the portfolio in which the
Division invests as well as the charges assessed against the Division for a
Valuation Period. The factor is calculated as follows:
(1) We take the net asset value of the portfolio in which the
Division invests at the end of the current Valuation Period.
(2) We add to (1) the amount of any dividend or capital gains
distribution declared for the investment portfolio and reinvested
in such portfolio during the current Valuation Period. We
subtract from that amount a charge for our taxes, if any.
(3) We divide (2) by the net asset value of the portfolio at the end
of the preceding Valuation Period.
(4) We subtract the daily Mortality and Expense Risk Charge for each
Division described in the Schedule for each day in the Valuation
Period.
(5) We subtract the daily Asset Based Administrative Charge described
in the Schedule for each day in the Valuation Period.
Calculations for Divisions investing in unit investment trusts are on a per
unit basis.
Net Rate of Return for a Variable Separate Account Division (Net Return
Rate)
The Net Rate of Return for a Variable Separate Account Division during a
Valuation Period is the Experience Factor for that Valuation Period minus
one.
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HOW WE MEASURE THE CONTRACT'S ACCUMULATION VALUE (continued)
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FIXED ACCOUNT
The Fixed Account is a Separate Account under state insurance law and is
not required to be registered with the Securities and Exchange Commission
under the Investment Company Act of 1940. Interests in the Fixed Account
are registered under the Securities Act of 1933. The Fixed Account includes
various Fixed Allocations which we credit with fixed rates of interest
declared by us for the then available Guarantee Period(s) you select. Any
declaration will by class and will be based solely on our expectations of
future earnings. We reset the interest rates for new Fixed Allocations
periodically based on our sole discretion. Such rates will apply to periods
following the date of declaration. Any declaration will be by class and
will be based on our future expectations. Interest will be credited daily
at a rate to yield the declared annual Guaranteed Interest Rate
Minimum Fixed Allocation
The minimum allocation to the Fixed Account in any one Fixed Allocation is
$250.00.
Guarantee Periods
We may offer any number of Guarantee Periods and may, from time to time,
change the Guarantee Periods available. Any change in the Guarantee Periods
available under the Contract will not affect existing Fixed Allocations in
a Guarantee Period until the Guarantee Period Maturity Date.
The Guaranteed Interest Rates for a Fixed Allocation are effective for the
entire period. The Maturity Date of a Guarantee Period will be on the last
day of the calendar month in which the Guarantee Period ends. Withdrawals
and transfers made during a Guarantee Period may be subject to a Market
Value Adjustment unless made within thirty days prior to the Maturity Date.
Upon the Maturity Date of a Guarantee Period, we will transfer the
Accumulation Value of the expiring Fixed Allocation to a Fixed Allocation
with a Guarantee Period equal in length to the expiring Guarantee Period,
unless you select another period prior to its Maturity Date. We will notify
you at least thirty days prior to a Maturity Date of your options for
renewal. If the period remaining from the expiry of the previous Guarantee
Period to the Annuity Commencement Date is less than the period you have
elected or the period expiring, the next shortest period then available
that will not extend beyond the Annuity Commencement Date will be offered
to you. If a period is not available, the Accumulation Value will be
transferred to the Specially Designated Division.
Market Value Adjustments
A Market Value Adjustment will be applied to a Fixed Allocation upon
withdrawal, transfer or application to an Income Plan if made more than
thirty days prior to such Fixed Allocation's Maturity Date, except on
Systematic Partial Withdrawals and XXX Partial Withdrawals AS DESCRIBED IN
"YOUR CONTRACT BENEFITS". The Market Value Adjustment is applied to each
Fixed Allocation separately and may be positive, negative or result in no
change.
Market Value Adjustment During The Right to Examine Period
The Market Value Adjustment is determined by multiplying the amount of the
Accumulation Value withdrawn by the following factor:
(((1+I)/(1+J))^(N/365))-1
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HOW WE MEASURE THE CONTRACT'S ACCUMULATION VALUE (continued)
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MARKET VALUE ADJUSTMENT FOLLOWING THE RIGHT TO EXAMINE PERIOD
The Market Value Adjustment is determined by multiplying the amount of the
Accumulation Value withdrawn, transferred or applied to an Income Plan by
the following factor:
(((1+I)/(1+J+.0050))^(N/365))-1
where: I is the Index Rate for a Fixed Allocation on the first day of the
applicable Guarantee Period; J is the Index Rate for new Fixed Allocations
with Guarantee Periods equal to the number of years (fractional years
rounded up to the next full year) remaining in the Guarantee Period at the
time of calculation; and N is the remaining number of days in the Guarantee
Period at the time of calculation.
Index Rate
The Index Rate is the average of the Ask Yields for the U.S. Treasury
Strips as reported by a national quoting service for the applicable
maturity. The average is based on the period from the 22nd day of the
calendar month two months prior to the calendar month of Index Rate
determination to the 21st day of the calendar month immediately prior to
the month of determination. The applicable maturity date for these U.S.
Treasury Strips is on or next following the last day of the Guarantee
Period. If the Ask Yields are no longer available, the Index Rate will be
determined using a suitable replacement method subject to any required
regulatory approval. We currently set the Index Rate once each calendar
month. However, we reserve the right to set the Index Rate more frequently
than monthly, but in no event will such Index Rate be based on a period
less than 28 days.
Market Value Adjustments will be applied as follows:
(1) The Market Value Adjustment will be applied to the amount
withdrawn before deduction of any applicable Surrender Charge.
(2) For a Partial Withdrawal, partial transfer or in the case where a
portion of an allocation is applied to an Income Plan, the Market
Value Adjustment will be calculated on the total amount that must
be withdrawn, transferred or applied to an Income Plan in order
to provide the amount requested
(3) If the Market Value Adjustment is negative, it will be assessed
first against any remaining Accumulation Value in the particular
Fixed Allocation. Any remaining Market Value Adjustment will be
applied against the amount withdrawn, transferred or applied to
an Income Plan.
(4) If the Market Value Adjustment is positive, it will be credited
to any remaining Accumulation Value in the particular Fixed
Allocation. If a cash surrender, full transfer or full
application to an Income Plan has been requested, the Market
Value Adjustment is added to the amount withdrawn, transferred or
applied to an Income Plan.
VALUATION PERIOD
Each Division and Fixed Allocation will be valued at the end of each
Valuation Period on a Valuation Date.
ACCUMULATION VALUE
The Accumulation Value of this Contract is the sum of the amounts in each
of the Divisions of the Variable Separate Account, the General Account, and
the Fixed Account. You select how to allocate the Accumulation Value among
the available Divisions and the Fixed Account.
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HOW WE MEASURE THE CONTRACT'S ACCUMULATION VALUE (continued)
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ACCUMULATION VALUE IN EACH DIVISION AND FIXED ALLOCATION
On the Contract Date
On the Contract Date, the Accumulation Value is allocated to each Division
and Fixed Allocation as elected by you, subject to certain terms and
conditions imposed by us. We reserve the right to allocate premium to the
Specially Designated Division during any Right to Examine period. After
such time, allocation will be made proportionately in accordance with the
initial allocation(s) as elected by you.
On each Valuation Date
At the end of each subsequent Valuation Period, the amount of Accumulation
Value in each Division and Fixed Allocation will be calculated as follows:
(1) We take the Accumulation Value in the Division or Fixed
Allocation at the end of the preceding Valuation Period.
(2) We multiply (1) by the Variable Separate Account Division's Net
Rate of Return for the current Valuation Period or we calculate
the interest to be credited to a Fixed Allocation or to a
Guaranteed Interest Division for the current Valuation Period.
(3) We add (1) and (2).
(4) We add to (3) any additional Premium Payments (less any premium
deductions shown in the Schedule) allocated to the Division or
Fixed Allocation during the current Valuation Period.
(5) We add or subtract allocations to or from that Division or Fixed
Allocation during the current Valuation Period.
(6) We subtract from (5) any Partial Withdrawals from the Division or
Fixed Allocation during the current Valuation Period.
(7) We subtract from (6) the amounts deducted from that Division or
Fixed Allocation for:
(a) any charges due for the Optional Benefit Riders shown in the
Schedule;
(b) any deductions from Accumulation Value as shown in the
Schedule.
However, if elected, amounts deducted will be taken from the Charge
Deduction Division.
CHARGES DEDUCTED FROM ACCUMULATION VALUE ON EACH CONTRACT PROCESSING DATE
Expense charges and fees are shown in the Schedule.
Charge Deduction Division Option
We will deduct all charges against the Accumulation Value of this Contract
from the Charge Deduction Division if you elected this option (see the
Schedule). If you did not elect this Option or if the charges are greater
than the amount in the Charge Deduction Division, the charges against the
Accumulation Value will be deducted as follows:
(1) If these charges are less than the Accumulation Value in the
Variable Separate Account Divisions, they will be deducted
proportionately from all Divisions.
(2) If these charges exceed the Accumulation Value in the Variable
Separate Account Divisions, any excess over such value will be
deducted proportionately from any Fixed Allocations and
Guaranteed Interest Divisions.
Any charges taken from the Fixed Account or the General Account will be
taken from Allocations starting with the Guarantee Period nearest its
Maturity Date until such charges have been paid.
At any time while this Contract is in effect, you may change your election
of this Option. To do this you must send us a written request to our
Customer Service Center. Any change will take effect within seven days of
the date we receive your request.
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YOUR CONTRACT BENEFITS
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While this Contract is in effect, there are important rights and benefits
that are available to you. We discuss these rights and benefits in this
section.
PARTIAL WITHDRAWAL OPTION
To take a Partial Withdrawal, you must provide us satisfactory written
notice at our Customer Service Center. The maximum amount that can be
withdrawn each Contract Year without being considered an Excess Partial
Withdrawal is described below. We will collect a Surrender Charge for
Excess Partial Withdrawals and any unrecovered Premium Taxes.
We will treat as a request to surrender the Contract any request for a
Partial Withdrawal which (a) exceeds 90% of the Cash Surrender Value; and
(b) reduces the Cash Surrender Value after such withdrawal to less than
$2,500.
Minimum Withdrawal Amount
The Minimum Withdrawal Amount that can be taken is $100.
Conventional Partial Withdrawals
The maximum amount that can be taken as a Conventional Partial Withdrawal
each Contract Year without being considered an Excess Partial Withdrawal is
the Free Amount, equal to 10% of the Contract's Accumulation Value,
determined as of the date of withdrawal. If Benefit Option Package III is
elected, any percentage of the Free Amount not taken in any Contract Year,
calculated as of the last withdrawal in that year, will accumulate to a
maximum of 30%. If Option III is elected after the Contract Date, this
right of accumulation will begin on the date Option III is elected.
Any Conventional Partial Withdrawal from Fixed Allocations is subject to a
Market Value Adjustment unless withdrawn within 30 days prior to the
Maturity Date.
Systematic Partial Withdrawals
Systematic Partial Withdrawals may be elected to commence after 28 days
from the Contract Issue Date and may be taken on a monthly, quarterly or
annual basis. You select the day withdrawals will be made, but no later
than the 28th day of the month. If you do not elect a day, the same day of
the month as the Contract Date will be used.
Maximum Systematic Partial Withdrawal Amounts:
Variable Separate .833% of Accumulation Value monthly,
Account Divisions: 2.5% of Accumulation Value quarterly or
10% of Accumulation Value annually, not
previously withdrawn.
Fixed Allocations and Interest earned on a Fixed Allocation or
Guaranteed Interest Guaranteed Interest Division for the
Divisions prior month, quarter or year (depending
on the frequency selected).
Systematic Partial Withdrawals which do not exceed the Maximum Systematic
Partial Withdrawal Amounts are not subject to Surrender Charges. Systematic
Partial Withdrawals of interest from Fixed Allocations are not subject to a
Market Value Adjustment.
Systematic Partial Withdrawals and Conventional Partial Withdrawals may not
be taken in the same Contract Year.
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YOUR CONTRACT BENEFITS
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XXX Partial Withdrawals for Qualified Plans Only
Partial Withdrawals may be taken from a Contract issued as an XXX on a
monthly, quarterly or annual basis. Such XXX Partial Withdrawals will not
be subject to Surrender Charges to the extent that they do not exceed the
Minimum Required Distribution based on the Accumulation Value of this
Contract, as set forth in the Internal Revenue Code. A minimum withdrawal
of $100.00 is required. You select the day the withdrawals will be made,
but no later than the 28th day of the month. If you do not elect a day, the
same day of the month as the Contract Date will be used. An XXX Partial
Withdrawal in excess of the Systematic Partial Withdrawal Amounts described
above may be subject to a Market Value Adjustment.
Systematic Partial Withdrawals and Conventional Partial Withdrawals are not
allowed when XXX Partial Withdrawals are being taken.
SURRENDER CHARGE
A Surrender Charge may be imposed as a percentage of premium not previously
withdrawn if the Contract is surrendered or an Excess Partial Withdrawal is
taken. The percentage imposed at time of surrender or Excess Partial
Withdrawal depends on the number of complete years that have elapsed since
a Premium Payment was made. The Surrender Charge expressed as a percentage
of each Premium Payment not previously withdrawn is as follows:
Complete Years Elapsed
Since Premium Payment 0 1 2 3 4 5 6 7+
---------------------------------------------------------------------------
Surrender Charges 7% 7% 6% 6% 5% 4% 3% 0%
To determine the Surrender Charge on Excess Partial Withdrawals, the
withdrawals will occur in the following order:
(1) The Free Amount;
(2) Premium Payments made seven or more years prior to the
withdrawal;
(3) Premium Payments made less than seven years prior to withdrawal;
and
(4) Any Remaining Accumulation Value.
Free Amounts are not treated as withdrawals of Premium Payments for
purposes of calculating any Surrender Charge.
Waiver of Surrender Charge
No Surrender Charges will be assessed for an Excess Partial Withdrawal or
surrender if:
(1) More than one Contract Year has elapsed since the Contract Date;
and
(2) The withdrawal or surrender is requested within three years after
your admission to and confinement in a licensed Nursing Care
Facility for 45 consecutive days.
This waiver does not apply if you spent at least one day in a licensed
Nursing Care Facility during the two week period immediately preceding or
immediately following the Contract Date.
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YOUR CONTRACT BENEFITS (continued)
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CASH VALUE BENEFIT
Cash Surrender Value
The Cash Surrender Value, while the Annuitant is living and before the
Annuity Commencement Date, is determined as follows:
(1) We take the Contract's Accumulation Value;
(2) We adjust for any applicable Market Value Adjustment;
(3) We deduct any Surrender Charges;
(4) We deduct any charges shown in the Schedule that have been
incurred but not yet deducted, including:
(a) any administrative charge that has not yet been deducted;
(b) the pro rata part of any charges for Optional Benefit
Riders; and
(a) any applicable premium or other tax.
Cancelling to Receive the Cash Surrender Value
On or before the Annuity Commencement Date if the Annuitant is living, you
may surrender this Contract to us. To do this, you must return this
Contract with a signed request for cancellation to our Customer Service
Center. The Cash Surrender Value will vary daily. We will determine the
Cash Surrender Value as of the date we receive the Contract and your signed
request in our Customer Service Center. All benefits under this Contract
will then end. We will usually pay the Cash Surrender Value within seven
days; but, we may delay payment as described in the Payments We May Defer
provision.
PROCEEDS PAYABLE TO THE BENEFICIARY
Prior to the Annuity Commencement Date
If you die prior to the Annuity Commencement Date, we will pay the
Beneficiary the Death Benefit based on the Benefit Option Package elected
and in effect on the date of death. If there are joint Owners and any Owner
dies, we will pay the surviving Owner(s) the Death Benefit. We will pay the
amount on receipt of due proof of the Owner's death at our Customer Service
Center. Such amount may be received in a single lump sum or applied to any
of the Annuity Options (see Choosing an Income Plan). When the Owner (or
all Owners where there are joint Owners) is not an individual, the Death
Benefit will become payable on the death of the Annuitant prior to the
Annuity Commencement Date (unless a Contingent Annuitant survived the
Annuitant). Only one Death Benefit is payable under this Contract. In all
events, distributions under the Contract must be made as required by
applicable law.
How to Claim Payments to Beneficiary
We must receive proof of the Owner's (or the Annuitant's) death before we
will make any payments to the Beneficiary. We will calculate the Death
Benefit as of the date we receive due proof of death. The Beneficiary
should contact our Customer Service Center for instructions.
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BENEFIT OPTION PACKAGES
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This Contract offers three Benefit Option Packages. The Option Package you
elect is shown in the Schedule.
ELECTION OF BENEFIT OPTION PACKAGES
On any Contract Anniversary prior to and including the date you reach
Attained Age 80, you may elect to replace the Benefit Option Package in
effect with another Benefit Option Package provided you are the sole Owner
and you and the Annuitant meet the eligibility criteria stated below. Such
election must be received by us in writing at our Customer Service Center
on or during the sixty day period immediately preceding the Contract
Anniversary.
The effective date of the newly elected Benefit Option Package will be the
Contract Anniversary at the end of the sixty day election period. We will
issue another Schedule reflecting the new Benefit Option Package Chosen.
This new Schedule will reflect the new Schedule Date and the revised
Charges, if any, for the Benefit Option Package elected.
SPECIAL FUNDS AND EXCLUDED FUNDS
The allocation of Accumulation Value to the Variable Separate Account
Divisions, the General Account, and the Fixed Account may be subject to
specific limitations or rules when calculating the Death Benefits provided
in each of the Benefit Option Packages described below. Such allocations
are called Special Funds and Excluded Funds. Special Funds and Excluded
Funds, if any, are shown in the Schedule.
We may add newly available Divisions as Special Funds or Excluded Funds. We
may also reclassify an existing Division as a Special Fund or Excluded Fund
or remove such designation(s) upon 30 days notice to you. Such
reclassifications will apply to amounts transferred or otherwise allocated
to such Division after the date of the change. We may reduce any applicable
Mortality and Expense Risk Charge for that portion of the Contract
allocated to a Special Fund or Excluded Fund.
COVERED FUNDS
Any divisions not designated as Special or Excluded shall be Covered.
DESCRIPTION OF BENEFIT OPTION PACKAGE I
Benefit Option Package I is not available if, at the time of election, the
Contract's Accumulation Value is less than $15,000 ($1,500 for Qualified
Plans).
The Death Benefit is the greatest of (i), (ii) and (iii) below, where:
(i) is the Accumulation Value less any Credits applied after or
within 12 months of the date of death;
(ii) is the Guaranteed Death Benefit less any Credits applied after or
within 12 months of the date of death;
(iii) is the Cash Surrender Value.
Guaranteed Death Benefit
The Guaranteed Death Benefit is equal to the sum of I and II below.
I. The Guaranteed Death Benefit Base for Covered Funds
II. The Accumulation Value allocated to Excluded Funds
On the Contract Date, the Guaranteed Death Benefit Base for Covered Funds
is the initial premium plus any Credits, if applicable, allocated to
Covered Funds. On subsequent Valuation Dates, the Guaranteed Death Benefit
Base for Covered Funds is calculated as follows:
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(1) Start with the Guaranteed Death Benefit Base for Covered Funds
from the prior Valuation Date.
(2) Add any additional premiums paid and any Credits allocated to
Covered Funds during the current Valuation Period to (1).
(3) Adjust (2) for any transfers to or from Excluded Funds during the
current Valuation Period.
(4) Subtract from (3) any Partial Withdrawal Adjustments for any
Partial Withdrawal made from Covered Funds during the current
Valuation Period.
The Guaranteed Death Benefit Base for Excluded Funds has a corresponding
definition, but with respect to amounts allocated to Excluded Funds.
Transfers from Excluded Funds to Covered Funds will reduce the Guaranteed
Death Benefit Base for Excluded Funds on a pro-rata basis. The resulting
increase in the Guaranteed Death Benefit Base for Covered Funds will equal
the lesser of the reduction in the Guaranteed Death Benefit Base for
Excluded Funds and the net Accumulation Value transferred.
Transfers from Covered Funds to Excluded Funds will reduce the Guaranteed
Death Benefit Base for Covered Funds on a pro-rata basis. The resulting
increase in the Guaranteed Death Benefit Base for Excluded Funds will equal
the reduction in Guaranteed Death Benefit Base for Covered Funds.
Partial Withdrawal Adjustments
For any partial withdrawal, the Death Benefit components will be reduced on
a pro-rata basis. The pro-rata adjustment is equal to (1) divided by (2)
multiplied by (3), where: (1) is the Accumulation Value withdrawn; (2) is
the Accumulation Value immediately prior to withdrawal; and (3) is the
amount of the applicable Death Benefit component immediately prior to the
withdrawal. Separate adjustments will apply to the amounts in the Covered
and Excluded Funds.
Change of Owner
A change of Owner will result in recalculation of the Death Benefit and the
Guaranteed Death Benefit. If the new Owner's Attained Age at the time of
the change is less than 86, the Guaranteed Death Benefit in effect prior to
the change will remain in effect and the Death Benefit provision shall
apply. If the new Owner's Attained Age is 86 or greater at the time of the
change, or if the new owner is not an individual (other than a trust
created for the benefit of the owner or annuitant), the Guaranteed Death
Benefit will be zero, and the Death Benefit will then be the Cash Surrender
Value.
Spousal Continuation upon Death of Owner
If at the Owner's death, the surviving spouse of the deceased Owner is the
Beneficiary and such surviving spouse elects to continue the Contract as
their own pursuant to Internal Revenue Code Section 72(s) or the equivalent
provisions of U.S. Treasury Department rules for qualified plans, the
following will apply:
(1) If the Guaranteed Death Benefit as of the date we receive due
proof of death of the Owner, before deducting any Credits, minus
the Accumulation Value, also as of that date, is greater than
zero, we will add such difference to the Accumulation Value. Such
addition will be allocated to the Divisions of the Separate
Account then available in the same proportion as the Accumulation
Value in each available Division bears to the Accumulation Value
in all such Divisions. If there is no Accumulation Value in any
Division then available, the addition will be allocated to the
Specially Designated Division.
(2) The Guaranteed Death Benefit will continue to apply, with all age
criteria using the surviving spouse's age as the determining age.
(3) At subsequent surrender, any Surrender Charge applicable to
premiums paid prior to the date we receive due proof of death of
the Owner will be waived. Any premiums paid later will be subject
to any applicable Surrender Charge.
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Non Spousal Continuation upon Death of Owner
If, at the Owner's death, the non spouse beneficiary of the deceased Owner
elects to continue the Contract for the purpose of taking distributions
pursuant to Internal Revenue Code Section 72(s) or the equivalent
provisions of U.S. Treasury Department rules for qualified plans, the
following will apply:
(1) If the Guaranteed Death Benefit as of the date we receive due
proof of death of the Owner, minus the Accumulation Value, also
as of that date, is greater than zero, we will add such
difference to the Accumulation Value. Such addition will be
allocated to the Divisions of the Separate Account then available
in the same proportion as the Accumulation Value in each
available Division bears to the Accumulation Value in all such
Divisions. If there is no Accumulation Value in any Division then
available, the addition will be allocated to the Specially
Designated Division.
(2) Thereafter, the Guaranteed Death Benefit will no longer be
available under this Contract, and the amount payable upon the
death of the non spouse beneficiary, if such beneficiary dies
while receiving distributions under this Contract, will be the
Accumulation Value as of the date we receive due proof of such
beneficiary's death.
(3) No additional premium payments may be made under this Contract
following the date we receive due proof of death of the Owner.
(4) At subsequent surrender, any applicable Surrender Charges will be
waived.
DESCRIPTION OF BENEFIT OPTION PACKAGE II
Benefit Option Package II is not available if there are Joint Contract
Owners or if, at the time of election, the Contract's Accumulation Value is
less than $5,000 ($1,500 for Qualified Plans).
Death Benefit
The Death Benefit is the greatest of (i), (ii), (iii) and (iv) below,
where:
(i) is the Accumulation Value less any Credits applied after or
within 12 months of the date of death;
(ii) is the Guaranteed Death Benefit less any Credits applied after or
within 12 months of the date of death;
(iii) is the Cash Surrender Value; and
(iv) is the Minimum Death Benefit, less any Credits applied after or
within 12 months of the date of death.
Minimum Death Benefit
The Minimum Death Benefit is equal to the sum of I and II below:
I. The Accumulation Value allocated to Excluded Funds; and
II. Adjusted Premium for Covered Funds.
Adjusted Premium for Covered Funds shall mean all premium and any credits
allocated to Covered Funds, plus an adjustment for any amounts transferred
to Covered Funds, less a pro-rata adjustment for any amounts transferred or
withdrawn from Covered Funds. The amount of the pro-rata adjustment will
equal (a) times (b) divided by (c), where: (a) is the Adjusted Premium for
Covered Funds prior to the transfer or withdrawal; (b) is the Accumulation
Value of the transfer or withdrawal; and (c) is the Accumulation Value
allocated to Covered Funds before the transfer or withdrawal.
Adjusted Premium for Excluded Funds has the same definition, but with
respect to amounts allocated to Excluded Funds.
Transfers from Excluded Funds to Covered Funds increase the Adjusted
Premium for Covered Funds by the lesser of the reduction of the Adjusted
Premium for Excluded Funds and net Accumulation Value transferred.
Transfers from Covered Funds to Excluded Funds increase the Adjusted
Premium for Excluded Funds by the reduction in the Adjusted Premium for
Covered Funds.
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Guaranteed Death Benefit
The Guaranteed Death Benefit is equal to the sum of I and II below.
I. The Guaranteed Death Benefit Base for Covered Funds
II. The Accumulation Value allocated to Excluded Funds
If the Schedule Date is the Contract Date, the Guaranteed Death Benefit
Base for Covered Funds as of such date is the initial premium plus any
Credits, if applicable, allocated to Covered Funds. If the Schedule Date is
other than the Contract Date:
(1) If a transfer from Benefit Option Package I has occurred, the
Guaranteed Death Benefit Base for Covered Funds as of the new
Schedule Date is set to equal the Accumulation Value allocated to
Covered Funds minus any fees or charges deducted as of such date;
and
(2) If a transfer from Benefit Option Package III has occurred, the
Guaranteed Death Benefit Base for Covered Funds as of the new
Schedule Date is set to equal the Alternate Guaranteed Death
Benefit Base for Covered and Special Funds as defined under
Benefit Option Package III as of such date.
On subsequent Valuation Dates, the Guaranteed Death Benefit Base for
Covered Funds is calculated as follows:
(1) Start with the Guaranteed Death Benefit Base for Covered Funds on
the prior Valuation Date.
(2) Add to (1) any additional premium and any Credits allocated to
the Covered Funds during the current Valuation Period and
adjustments for transfers to Covered Funds during the current
Valuation Period and subtract from (1) any adjustment for
transfers from Covered Funds during the current Valuation Period
and any Partial Withdrawal Adjustments for any Partial
Withdrawals taken from Covered Funds during the current Valuation
Period.
(3) On a Valuation Date that occurs on or prior to the Owner's
attained age 90, which is also a Contract Anniversary, we set the
Guaranteed Death Benefit Base for Covered Funds equal to the
greater of (2) or the Accumulation Value allocated to Covered
Funds minus any fees or charges deducted as of such date. On all
other Valuation Dates, the Guaranteed Death Benefit Base for
Covered Funds is equal to (2).
The Guaranteed Death Benefit Base for Excluded Funds has a corresponding
definition, but with respect to amounts allocated to Excluded Funds.
Transfers from Excluded Funds to Covered Funds will reduce the Guaranteed
Death Benefit Base for Excluded Funds on a pro-rata basis. The resulting
increase in the Guaranteed Death Benefit Base for Covered Funds will equal
the lesser of the reduction in the Guaranteed Death Benefit Base for
Excluded Funds and the net Accumulation Value transferred.
Transfers from Covered Funds to Excluded Funds will reduce the Guaranteed
Death Benefit Base for Covered Funds on a pro-rata basis. The resulting
increase in the Guaranteed Death Benefit Base for Excluded Funds will equal
the reduction in Guaranteed Death Benefit Base for Covered Funds.
Partial Withdrawal Adjustments
For any partial withdrawal, the Death Benefit components will be reduced on
a pro-rata basis. The pro-rata adjustment is equal to (1) divided by (2)
multiplied by (3), where: (1) is the Accumulation Value withdrawn; (2) is
the Accumulation Value immediately prior to withdrawal; and (3) is the
amount of the applicable Death Benefit component immediately prior to the
withdrawal. Separate adjustments will apply to amounts in the Covered and
Excluded Funds.
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BENEFIT OPTION PACKAGES (continued)
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Change of Owner
If there is a change in ownership and the new Owner's Attained Age at the
time of the change is less than 81, the Guaranteed Death Benefit in effect
prior to the change will remain in effect and the provisions for Benefit
Option Package II will continue to apply. If the new Owner's Attained Age
at the time of the change is 81 or greater, if Joint Owners are named, or
if the new Owner is not an individual (except in the case of a trust issued
for the benefit of the owner or annuitant), the provisions of Benefit
Option Package I will apply and we will issue a new Schedule reflecting the
Schedule Date and the revised charges, if any, applicable to Benefit Option
Package I.
Spousal Continuation upon Death of Owner
If at the Owner's death, the surviving spouse of the deceased Owner is the
Beneficiary and such surviving spouse elects to continue the Contract as
their own pursuant to Internal Revenue Code Section 72(s) or the equivalent
provisions of U.S. Treasury Department rules for qualified plans, the
following will apply:
(1) If the greater of (ii) and (iv) in the Death Benefit provision as
of the date we receive due proof of death of the Owner, before
deducting any Credits, minus the Accumulation Value, also as of
that date, is greater than zero, we will add such difference to
the Accumulation Value. Such addition will be allocated to the
Divisions of the Separate Account then available in the same
proportion as the Accumulation Value in each available Division
bears to the Accumulation Value in all such Divisions. If there
is no Accumulation Value in any Division then available, the
addition will be allocated to the Specially Designated Division.
(2) The Guaranteed Death Benefit and the Minimum Death Benefit will
continue to apply, using the surviving spouse's age as the
determining age.
(3) At subsequent surrender, any Surrender Charge applicable to
premiums paid prior to the date we receive due proof of death of
the Owner will be waived. Any premiums paid later will be subject
to any applicable Surrender Charge.
Non Spousal Continuation upon Death of Owner
If, at the Owner's death, the non spouse beneficiary of the deceased Owner
elects to continue the Contract for the purpose of taking distributions
pursuant to Internal Revenue Code Section 72(s) or the equivalent
provisions of U.S. Treasury Department rules for qualified plans, the
following will apply:
(1) If the greater of (ii) and (iv) in the Death Benefit provision as
of the date we receive due proof of death of the Owner, minus the
Accumulation Value, also as of that date, is greater than zero,
we will add such difference to the Accumulation Value. Such
addition will be allocated to the Divisions of the Separate
Account then available in the same proportion as the Accumulation
Value in each available Division bears to the Accumulation Value
in all such Divisions. If there is no Accumulation Value in any
Division then available, the addition will be allocated to the
Specially Designated Division.
(2) Thereafter, the Guaranteed Death Benefit and Minimum Death
Benefit will no longer be available under this Contract, and the
amount payable upon the death of the non spouse beneficiary, if
such beneficiary dies while receiving distributions under this
Contract, will be the Accumulation Value as of the date we
receive due proof of such beneficiary's death.
(3) No additional premium payments may be made under this Contract
following the date we receive due proof of death of the Owner.
(4) At subsequent surrender, any applicable Surrender Charges will be
waived.
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BENEFIT OPTION PACKAGES (continued)
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DESCRIPTION OF BENEFIT OPTION PACKAGE III
Benefit Option Package III is not available if there are Joint Contract
Owners or if, at the time of election, the Contract's Accumulation Value is
less than $5,000 ($1,500 for Qualified Plans).
The Death Benefit is the greatest of (i), (ii), (iii), (iv) and (v) below,
where:
(i) is the Accumulation Value less any Credits applied after or
within 12 months of the date of death;
(ii) is the lesser of (a) and (b), less any Credits applied after or
within 12 months of the date of death where (a) is the Guaranteed
Death Benefit, and (b) is the Maximum Guaranteed Death Benefit;
(iii) the Cash Surrender Value;
(iv) is the Minimum Death Benefit, less any Credits applied after or
within 12 months of the date of death; and
(v) the Alternate Guaranteed Death Benefit less any Credits applied
after or within 12 months of the date of death.
Minimum Death Benefit
The Minimum Death Benefit is equal to the sum of I and II below:
I. The Accumulation Value allocated to Excluded Funds; and
II. Adjusted Premium for Covered and Special Funds.
Adjusted Premium for Covered and Special Funds shall mean all premium and
any Credits allocated to Covered or Special Funds, plus an adjustment for
any amounts transferred to Covered or Special Funds, less a pro-rata
adjustment for any amounts transferred or withdrawn from Covered or Special
Funds. The amount of the pro-rata adjustment will equal (a) times (b)
divided by (c), where: (a) is the Adjusted Premium for Covered and Special
Funds prior to the transfer or withdrawal; (b) is the Accumulation Value of
the transfer or withdrawal; and (c) is the Accumulation Value allocated to
Covered and Special Funds before the transfer or withdrawal. Adjusted
Premium for Excluded Funds has the same definition, but with respect to
amounts allocated to Excluded Funds.
Transfers from Excluded Funds to Covered or Special Funds increase the
Adjusted Premium for Covered and Special Funds by the lesser of the
reduction of the Adjusted Premium for Excluded Funds and net Accumulation
Value transferred. Transfers from Covered or Special Funds to Excluded
Funds increase the Adjusted Premium for Excluded Funds by the reduction in
the Adjusted Premium for Covered and Special Funds.
Guaranteed Death Benefit
The Guaranteed Death Benefit is equal to the sum of I, II and III below.
I. The Guaranteed Death Benefit Base for Covered Funds
II. The Guaranteed Death Benefit Base for Special Funds
III. The Accumulation Value allocated to Excluded Funds
On the Schedule Date, the Guaranteed Death Benefit Base for Covered Funds
is set to equal the Accumulation Value allocated to Covered Funds minus any
fees or charges deducted as of such date. On subsequent Valuation Dates,
the Guaranteed Death Benefit Base for Covered Funds is calculated as
follows:
(1) Start with the Guaranteed Death Benefit Base for Covered Funds on
the prior Valuation Date.
(2) Calculate Interest on (1) for the current Valuation Period at the
Guaranteed Death Benefit Interest Rate shown below.
(3) Add (1) and (2).
(4) Add to (3) any additional premiums and any Credits allocated to
Covered Funds during the current Valuation Period.
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BENEFIT OPTION PACKAGES (continued)
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(5) Add to or subtract from (4) adjustments for transfers made during
the current Valuation Period.
(6) Subtract from (5) the amount of any Partial Withdrawal
Adjustments for any partial withdrawals made from Covered Funds
during the current Valuation Period.
The Guaranteed Death Benefit Base for Excluded Funds has a corresponding
definition, but with respect to amounts allocated to Excluded Funds.
On the Schedule Date, the Guaranteed Death Benefit Base for Special Funds
is set to equal the Accumulation Value allocated to Special Funds minus any
fees or charges deducted as of such date. On subsequent Valuation Dates,
the Guaranteed Death Benefit Base for Special Funds is calculated as
follows:
(1) Start with the Guaranteed Death Benefit Base for Special Funds on
the prior Valuation Date.
(2) Add to (1) any additional premiums and any Credits allocated to
Special Funds during the current Valuation Period.
(3) Add to or subtract from (3) adjustments for transfers made during
the Valuation Period.
(4) Subtract from (3) the amount of any Partial Withdrawal
Adjustments for any partial withdrawals made from Special Funds
during the current Valuation Period.
Transfers
Transfers from Special Funds to Covered or Excluded Funds will reduce the
Guaranteed Death Benefit Base for Special Funds on a pro-rata basis. The
resulting increase in the Guaranteed Death Benefit Base for Covered or
Excluded Funds will equal the reduction in the Guaranteed Death Benefit
Base for Special Funds.
Transfers from Covered Funds to Special or Excluded Funds will reduce the
Guaranteed Death Benefit Base for Covered Funds on a pro-rata basis. The
resulting increase in the Guaranteed Death Benefit Base for Special or
Excluded Funds will equal the reduction in Guaranteed Death Benefit Base
for Covered Funds.
Transfers from Excluded Funds to Covered or Special Funds will reduce the
Guaranteed Death Benefit Base for Excluded Funds on a pro-rata basis. The
resulting increase in the Guaranteed Death Benefit Base for Covered or
Special Funds will equal the lesser of the reduction in the Guaranteed
Death Benefit Base for Excluded Funds and the net Accumulation Value
transferred.
Guaranteed Death Benefit Interest Rate
The Guaranteed Death Benefit Interest Rate is 5%, except that for any
Valuation Period ending after the Contract Anniversary on which the Owner
attains age 90, or after the Maximum Guaranteed Death Benefit has been
reached, the Guaranteed Death Benefit Interest Rate will be 0%.
Maximum Guaranteed Death Benefit
The Maximum Guaranteed Death Benefit is equal to three times premium paid,
plus three times any Credits, reduced by the amount of any Partial
Withdrawal Adjustments. Any addition due to spousal continuation will not
affect the Maximum Guaranteed Death Benefit or the Guaranteed Death Benefit
Base.
Partial Withdrawal Adjustments
For any partial withdrawal, the Death Benefit components will be reduced on
a pro-rata basis. The pro-rata adjustment is equal to (1) divided by (2)
multiplied by (3), where: (1) is the Accumulation Value withdrawn; (2) is
the Accumulation Value immediately prior to withdrawal; and (3) is the
amount of the applicable Death Benefit component immediately prior to the
withdrawal. Separate adjustments will apply to the amounts in the Covered,
Excluded and Special Funds as well as the Maximum Guaranteed Death Benefit
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BENEFIT OPTION PACKAGES (continued)
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Alternate Guaranteed Death Benefit
The Alternate Guaranteed Death Benefit is equal to the sum of I and II
below.
I. The Alternate Guaranteed Death Benefit Base for Covered and
Special Funds
II The Accumulation Value allocated to Excluded Funds
If the Schedule Date is the Contract Date, the Alternate Guaranteed Death
Benefit Base for Covered and Special Funds as of such date is the initial
premium plus any Credits, if applicable, allocated to Covered and Special
Funds. If the Schedule Date is other than the Contract Date:
(1) If a transfer from Benefit Option Package I has occurred, the
Alternate Guaranteed Death Benefit Base for Covered and Special
Funds as of the new Schedule Date is set to equal the
Accumulation Value allocated to Covered and Special Funds minus
any fees or charges deducted as of such date; and
(2) If a transfer from Benefit Option Package II has occurred, the
Alternate Guaranteed Death Benefit Base for Covered and Special
Funds as of the new Schedule Date is set to equal the Guaranteed
Death Benefit Base for Covered Funds as defined under Benefit
Option Package II as of such date.
On subsequent Valuation Dates, the Alternate Guaranteed Death Benefit Base
for Covered and Special Funds is calculated as follows:
(1) Start with the Alternate Guaranteed Death Benefit Base for
Covered and Special Funds from the prior Valuation Date.
(2) Add to (1) any additional premium and any Credits allocated to
Covered and Special Funds during the current Valuation Period
(3) Add to (or subtract from) (2) adjustments for transfers made
during the current Valuation Period.
(4) Subtract from (3) any Partial Withdrawal Adjustments for any
partial withdrawals taken from Covered and Special Funds during
the current Valuation Period.
(5) On a Valuation Date that occurs on or prior to the Owner's
attained age 90, which is also a Contract Anniversary, we set the
Alternate Guaranteed Death Benefit Base for Covered and Special
Funds equal to the greater of (4) or the Accumulation Value in
Covered and Special Funds minus any fees and charges deducted as
of such date. On all other Valuation Dates, the Alternate
Guaranteed Death Benefit Base for Covered and Special Funds is
equal to (4).
The Alternate Guaranteed Death Benefit Base for Excluded Funds has a
corresponding definition, but with respect to amounts allocated to Excluded
Funds.
Transfers
Transfers from Special or Covered Funds to Excluded Funds will reduce the
Alternate Guaranteed Death Benefit Base for Covered and Special Funds on a
pro-rata basis. The resulting increase in the Alternate Guaranteed Death
Benefit Base for Excluded Funds will equal the reduction in the Alternate
Guaranteed Death Benefit Base for Covered and Special Funds.
Transfers from Excluded Funds to Covered or Special Funds will reduce the
Alternate Guaranteed Death Benefit Base for Excluded Funds on a pro-rata
basis. The resulting increase in the Alternate Guaranteed Death Benefit
Base for Covered and Special Funds will equal the lesser of the reduction
in the Alternate Guaranteed Death Benefit Base for Excluded Funds and the
net Accumulation Value transferred.
Change of Owner
If there is a change in ownership and the new Owner's Attained Age at the
time of the change is less than 81, the Guaranteed Death Benefit in effect
prior to the change will remain in effect and the provisions for Benefit
Option Package III will continue to apply. If the new Owner's Attained Age
at the time of the change is 81 or greater, if Joint Owners are named, or
if the new Owner is not an individual (except in the case of a trust issued
for the benefit of the owner or annuitant), the provisions of Benefit
Option Package I will apply and we will issue a new Schedule reflecting the
Schedule Date and the revised charges, if any, applicable to Benefit Option
Package I.
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BENEFIT OPTION PACKAGES (continued)
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Spousal Continuation upon Death of Owner
If at the Owner's death, the surviving spouse of the deceased Owner is the
Beneficiary and such surviving spouse elects to continue the Contract as
their own pursuant to Internal Revenue Code Section 72(s) or the equivalent
provisions of U.S. Treasury Department rules for qualified plans, the
following will apply:
(1) If the greatest of (ii), (iv) and (v) in the Death Benefit
provision as of the date we receive due proof of death of the
Owner, before deducting any Credits, minus the Accumulation
Value, also as of that date, is greater than zero, we will add
such difference to the Accumulation Value. Such addition will be
allocated to the Divisions of the Separate Account then available
in the same proportion as the Accumulation Value in each
available Division bears to the Accumulation Value in all such
Divisions. If there is no Accumulation Value in any Division then
available, the addition will be allocated to the Specially
Designated Division.
(2) The Guaranteed Death Benefit, the Alternate Guaranteed Death
Benefit, the Minimum Death Benefit, and the Maximum Guaranteed
Death Benefit will continue to apply, with all age criteria using
the surviving spouse's age as the determining age.
(3) At subsequent surrender, any surrender charge applicable to
premiums paid prior to the date we receive due proof of death of
the Owner will be waived. Any premiums paid later will be subject
to any applicable surrender charge.
Non Spousal Continuation upon Death of Owner
If, at the Owner's death, the non spouse beneficiary of the deceased Owner
elects to continue the Contract for the purpose of taking distributions
pursuant to Internal Revenue Code Section 72(s) or the equivalent
provisions of U.S. Treasury Department rules for qualified plans, the
following will apply:
(1) If the greatest of (ii), (iv) and (v) in the Death Benefit
provision as of the date we receive due proof of death of the
Owner, minus the Accumulation Value, also as of that date, is
greater than zero, we will add such difference to the
Accumulation Value. Such addition will be allocated to the
Divisions of the Separate Account then available in the same
proportion as the Accumulation Value in each available Division
bears to the Accumulation Value in all such Divisions. If there
is no Accumulation Value in any Division then available, the
addition will be allocated to the Specially Designated Division.
(2) Thereafter, the Guaranteed Death Benefit, the Alternate
Guaranteed Death Benefit, the Minimum Death Benefit, and the
Maximum Guaranteed Death Benefit will no longer be available
under this Contract, and the amount payable upon the death of the
non spouse beneficiary, if such beneficiary dies while receiving
distributions under this Contract, will be the Accumulation Value
as of the date we receive due proof of such beneficiary's death.
(3) No additional premium payments may be made under this Contract
following the date we receive due proof of death of the Owner.
(4) At subsequent surrender, any applicable Surrender Charges will be
waived
27
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CHOOSING AN INCOME PLAN
--------------------------------------------------------------------------------
ANNUITY BENEFITS
If you and the Annuitant are living on the Annuity Commencement Date, we
will begin making payments to you. We will make these payments under the
Annuity Option (or Options) elected by you. You may elect to apply any
portion of the Accumulation Value (minus any applicable premium tax) to any
Annuity Option by making a written request at least 30 days prior to the
Annuity Commencement Date. When the Annuity Option is elected, you must
also tell us if payments are to be made as a Fixed Annuity, a Variable
Annuity or some combination of Fixed and Variable Annuity. If Variable
Annuity payments are elected, you must also select the Assumed Interest
Rate (AIR) and specify the portion of the Accumulation Value (less any
applicable premium tax) to be allocated to the available Divisions. If no
Annuity Option has been elected by the Required Annuity Commencement Date,
payments will be made as a Fixed Annuity under Option 2 on a 10-year period
certain basis. The amount of the payments will be determined by applying
the Accumulation Value on the Annuity Commencement Date in accordance with
the Annuity Options section below (see Payments We May Defer). After
payments begin, only those payable as Variable Annuity Payments under
Option 1 may be commuted to a lump sum and Surrender Charges may apply.
Before we pay any Annuity Benefits, we require the return of this Contract.
If this Contract has been lost, we require the applicable lost Contract
form.
Fixed Annuity Payments
If Fixed Annuity payments are chosen, the payment rate for the option
chosen, shown in the tables in the Schedule, reflects the minimum
guaranteed interest rate. Interest rates actually paid may be higher.
Variable Annuity Payments
If Variable Annuity payments are chosen, the initial payment for the option
chosen, shown in the Schedule, reflects the Assumed Interest Rate selected
by you. Thereafter, the Divisions must earn this rate plus enough to cover
any deductions stated in the Schedule if future Annuity Payments are to
remain level. If earnings exceed this amount, Annuity Payments will
increase; if earnings are less, Annuity Payments will decrease.
Annuity Units
The Number of Annuity Units is based on the amount of the first Variable
Annuity Payment which is equal to:
(1) The portion of the Accumulation Value applied to pay a Variable
Annuity Payment (minus any applicable premium tax); divided by
(2) 1,000; multiplied by
(3) The payment rate in the tables shown in the Schedule for the
option chosen.
Such amount, or portion, of the Variable Annuity Payment will be divided by
the appropriate Annuity Unit Value on the tenth Valuation Date before the
due date of the first payment to determine the number of Annuity Units.
Thereafter, the number of Annuity Units remains unchanged. Each future
payment is equal to the sum of the products of each Annuity Unit Value
multiplied by the appropriate number of Annuity Units. The Annuity Unit
Value on the tenth Valuation Date prior to the due date of the payment is
used.
Annuity Unit Value
On any Valuation Date, an Annuity Unit Value is equal to:
(1) The Annuity Unit Value on the previous Valuation Day; multiplied
by
(2) The Annuity Net Return Factor(s) for the Valuation Date;
multiplied by
(3) A Factor to reflect the AIR.
The Annuity Unit Value and Annuity Payment amount may go up or down due to
investment gain or loss.
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CHOOSING AN INCOME PLAN (continued)
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Net Return Factor
The Net Return Factor(s) is(are) used to compute all Variable Annuity
Payments for any Division in the Variable Separate Account. The Net Return
Factor for each Division is equal to 1.0000 plus the Net Rate of Return.
The Net Rate of Return is equal to:
(1) The value of the shares of the Division at the end of a Valuation
Date; minus
(2) The value of shares of the Division at the start of the Valuation
Date; plus or minus
(3) Taxes (or reserves for taxes) on the Separate Account (if any);
divided by
(4) The value of shares of the Division at the start of the Valuation
Date; minus
(5) The daily Asset Based Administrative Charges and Mortality and
Expense Risk Charges described in the Schedule for each day in
the Valuation Period.
A Net Return Rate may be more or less than 0%.
The value of a share in a Division is equal to the net assets of the
Division divided by the number of shares outstanding.
Annuity Payments shall not be changed due to mortality or expense results.
ANNUITY COMMENCEMENT DATE SELECTION
You select the Annuity Commencement Date. You may select any date following
the first Contract Anniversary but before the Required Date of Annuity
Commencement stated below. On the Annuity Commencement Date, the age of the
Annuitant plus the number of years payments are guaranteed must not exceed
100. If you do not select a date, the Annuity Commencement Date will be in
the month following the required date of Annuity Commencement. In applying
the Accumulation Value, we may first collect any Premium Taxes due us. If,
on the Annuity Commencement Date, a Surrender Charge remains and you select
Annuity Option 1, your Annuity Option must include a period certain of at
least 10 years duration.
Required Date of Annuity Commencement
Distributions from a Contract funding a Qualified Plan must commence no
later than April 1st of the calendar year following the calendar year in
which you attain age 70 1/2. Otherwise, the Annuity Commencement Date may
be no later than the same date as the Contract Processing Date in the month
following the later of the Annuitant's 90th birthday or 10 years after the
last Premium Payment.
FREQUENCY SELECTION
You may choose the frequency of the Annuity Payments. They may be monthly,
quarterly, semi-annually or annually. If we do not receive written notice
from you, the payments will be made monthly.
THE INCOME PLAN
While this Contract is in effect and before the Annuity Commencement Date,
you may choose one or more Annuity Options for the payment of Death Benefit
proceeds. If, at the time of your death, no Option has been chosen for
paying the Death Benefit proceeds, the Beneficiary may choose an Option
within one year. You may also elect an Annuity Option on surrender of the
Contract for its Cash Surrender Value. For each Option we will issue a
separate written agreement putting the Option into effect.
Our Approval is needed for any Option where:
(1) the person named to receive payment is other than you or the
Beneficiary; or
(2) the person named is not a natural person, such as a corporation;
or
(3) any income payment would be less than the Minimum Annuity Income
Payment stated below.
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CHOOSING AN INCOME PLAN (continued)
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THE ANNUITY OPTIONS
Option 1. Income for a Fixed Period
Payment is made in equal installments for a fixed number of years. The
number of years must be at least 5 and not more than 30.
Option 2. Single Life Income
Payment is made to the person named in equal monthly installments based on
one of the following, as elected by you:
(a) Payments continue as long as the Annuitant is living and cease at
the Annuitant's death.
(b) Payments continue for a period certain and continue thereafter as
long as the Annuitant is living. The period certain may be
between 5 and 30 years as specified by you.
(c) Payments continue as long as the Annuitant is living. At the
Annuitant's death, the difference between the sum of the payments
made and the Accumulation Value applied to this option is paid to
the Beneficiary in a lump sum. This "Cash Refund" feature is
available only if the total amount applied to the Option is taken
as a Fixed Annuity payment.
Option 3. Joint Life Income
This Option is available if there are two Annuitants, one of whom is
designated the Primary Annuitant and the other the Secondary Annuitant.
Monthly payments continue as long as at least one of the Annuitants is
living based on one of the following, as elected by you:
(a) Payments continue as long as either Annuitant is living;
(b) Payments continue for a period certain and continue thereafter as
long as either Annuitant is living. The period certain may be
between 5 and 30 years as specified by you;
(c) Payments continue as long as either Annuitant is living. At the
death of both Annuitants, the difference between the sum of the
payments made and the Accumulation Value applied to this option
is paid to the Beneficiary in a lump sum. This "Cash Refund"
feature is available only if the total amount applied to the
Option is taken as a Fixed Annuity payment.
If Fixed Annuity Payments are chosen under Options 1, 2(a), 2(b), 3(a) or
3(b), you may also elect to have payments increase annually at 1%, 2% or 3%
compounded annually.
Payment may be made under any other method mutually agreed upon by you and
us.
Minimum Annuity Income Payment
The minimum initial monthly annuity income payment that we will make is
$50. The minimum total income payments in any one year is $250. We have the
right to increase these minimums based upon increases reflected in the
Consumer Price Index - Urban (CPI-U) since July 1, 1993.
PAYMENT WHEN NAMED PERSON DIES
When the person named to receive payment dies, we will pay any amounts
still due as provided by the Annuity Option elected. The amounts still due
are determined as follows:
(1) For Option 1, or for any remaining guaranteed payments in Option
2 or Option 3, payments will be continued.
(2) For Option 2a, no amounts are payable after the Annuitant's
death.
(3) For Option 3a, no amounts are payable after the death of both
Annuitants.
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OTHER IMPORTANT INFORMATION
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SENDING NOTICE TO US
Whenever written notice is required, send it to our Customer Service
Center. The address of our Customer Service Center is shown on the cover
page. Please include your Contract number in all correspondence.
REPORTS TO OWNER
We will send you a report at least once during each Contract Year. The
report will show the Accumulation Value and the Cash Surrender Value as of
the end of the Contract Processing Period. The report will also show the
allocation of the Accumulation Value as of such date and the amounts
deducted from or added to the Accumulation Value since the last report. The
report will also include any information that may be currently required by
the insurance supervisory official of the jurisdiction in which the
Contract is delivered.
We will also send you copies of any shareholder reports of the portfolios
in which the Divisions of the Variable Separate Account invest, as well as
any other reports, notices or documents required by law to be furnished to
Owners.
ASSIGNMENT - USING THIS CONTRACT AS COLLATERAL SECURITY
You may assign this Contract as collateral security for a loan or other
obligation. This does not change the ownership. Your rights and any
Beneficiary's right are subject to the terms of the assignment. The
Beneficiary's rights may be subordinate to those of an assignee unless the
Beneficiary was designated as an irrevocable Beneficiary prior to the
assignment. To make or release an assignment, we must receive written
notice satisfactory to us, at our Customer Service Center. We are not
responsible for the validity of any assignment.
CONTRACT CHANGES - APPLICABLE TAX LAW
We reserve the right to make changes in this Contract or its Riders to the
extent necessary to continue to qualify this Contract as an annuity. Any
such changes will apply uniformly to all Contracts that are affected. You
will be given advance written notice of such changes.
MISSTATEMENT OF AGE OR SEX
If an age or sex has been misstated, the amounts payable or benefits
provided by this Contract will be those that the Premium Payment made would
have bought at the correct age or sex.
NON-PARTICIPATING
This Contract does not participate in our divisible surplus.
CONTESTABILITY
This Contract is incontestable from its date of issue.
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OTHER IMPORTANT INFORMATION (continued)
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PAYMENTS WE MAY DEFER
We may not be able to determine the value of the assets in the Variable
Separate Account because:
(1) The NYSE is closed for trading;
(2) the SEC determines that a state of emergency exists;
(3) an order or pronouncement of the SEC permits a delay for the
protection of Owners; or
(4) the check used to pay the premium has not cleared through the
banking system. This may take up to 15 days.
During such times, as to amounts allocated to the Variable Separate
Account, we may delay:
(1) determination and payment of the Cash Surrender Value;
(2) determination and payment of any Death Benefit if death occurs
before the Annuity Commencement Date;
(3) allocation changes of the Accumulation Value; or
(4) application of the Accumulation Value under an income plan.
As to amounts allocated to the General Account and Fixed Account, we may,
at any time, defer payment of the Cash Surrender Value for up to six months
after we receive a request for it. We will allow interest of at least 3.0%
a year or greater if required by state law, on any Cash Surrender Value
payment derived from the General Account or Fixed Account that we defer 30
days or more.
AUTHORITY TO MAKE AGREEMENTS
All agreements made by us must be signed by one of our officers. No other
person, including an insurance agent or broker, has the authority to:
(1) change any of this Contract's terms;
(4) extend the time for Premium Payments; or
(5) make any agreement binding on us.
REQUIRED NOTE ON OUR COMPUTATIONS
We have filed a detailed statement of our computations with the insurance
supervisory official in the jurisdiction where this Contract is delivered.
The values are not less than those required by the law of that state or
jurisdiction. Any benefit provided by an attached Optional Benefit Rider
will not increase these values unless otherwise stated in that Rider.
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FLEXIBLE PREMIUM DEFERRED COMBINATION VARIABLE AND FIXED ANNUITY CONTRACT - NO
DIVIDENDS
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Variable Cash Surrender Values while the Annuitant and Owner are living and
prior to the Annuity Commencement Date. Limited Additional Premium Payment
Option. Death Benefit subject to guaranteed minimum. Partial Withdrawal Option.
Non-participating. Investment results reflected in values.
GA-IA-1112
