VUL 0230
FLEXIBLE PREMIUM VARIABLE LIFE INSURANCE POLICY
Insured: {Xxxx Xxx}
Owner: {Xxxx Xxx}
Payment Class: {Standard Non-Smoker}
Policy Number: {Specimen}
Face Amount: {100,000}
Issue Age: {35}
Sex: {Male}
Issue Date: {03/01/2002}
THIS IS A LEGAL CONTRACT--READ IT CAREFULLY
XXXXXXX BENEFIT LIFE COMPANY promises to pay the death benefit to the
beneficiary on death of the insured upon receipt of the due proof of death of
the insured.
PLEASE EXAMINE THE APPLICATION. We issued this policy based upon the answers in
the application (copy included) and receipt of your initial premium. If all
answers are not complete and true, the policy may be affected.
RIGHT TO CANCEL YOUR POLICY. You may cancel this policy by returning it to
Lincoln Benefit Life Company, or our agent, within 20 days after you receive it.
Return of the policy by mail is effective on being postmarked, properly
addressed and postage prepaid. We will refund any premiums allocated to the
separate account, adjusted to reflect investment gain or loss from the date of
allocation to the date of cancellation, in addition to any premium allocated to
the fixed account.
Executed for the Company at its home office in Lincoln, Nebraska on its issue
date.
Xxxxxxx X. Xxxxxxx B. Xxxxxx Xxxxxx
Secretary President
LINCOLN BENEFIT LIFE COMPANY
0000 Xxxxx 00xx Xxxxxx
Xxxxxxx, XX 00000
0-000-000-0000
A Legal Reserve Stock Life Insurance Company
FLEXIBLE PREMIUM VARIABLE LIFE POLICY
Minimum Premium Required in the First Year
Death Benefit Payable on the Insured's Death
Flexible Premiums Payable for Life
The Death Benefit and other Values provided by
this Policy are based on the investment experience
of the Separate Account,
the fixed account earnings, and other flexible factors.
These values may vary based on investment and
earnings experience and are not guaranteed as
to a fixed dollar amount.
Nonparticipating
SUMMARY OF POLICY
This policy insures the life of the insured. If the insured dies while this
policy is in force, the death benefit will be paid to the beneficiary.
Payments for this policy are flexible. They may be made during the lifetime of
the insured.
During the lifetime of the insured, you may:
...change the planned payments and time between payments;
...obtain policy loans;
...change the beneficiary;
...change the death benefit option;
...surrender the policy for its net surrender value;
...exercise the other rights provided.
This is only a summary of the policy terms. The detailed provisions of this
policy will control. The provisions of your policy are set forth in the
following sections:
Policy Data.............................Page 3 Policy Value..............................Page 12
Definitions.............................Page 6 Surrender Value...........................Page 14
Death Benefit...........................Page 8 Loans.....................................Page 15
Beneficiary.............................Page 9 Other Terms of Your Policy................Page 15
Ownership...............................Page 9 Exchange of Plan..........................Page 18
Premium Payment.........................Page 10 Application...............................Insert
Account Provisions......................Page 11 Benefit Riders (if any)...................Insert
READ YOUR POLICY CAREFULLY
DEFINITIONS
When these words are used in this policy, they have the meaning stated:
"app"
The application which you completed requesting this policy.
"benefit rider"
An additional benefit we are providing
"due proof of death"
(1) a certified original copy of the death certificate; or (2) a certified copy
of a decree of a court of competent jurisdiction as to the finding of death; or
(3) a written statement by a medical doctor who attended the deceased at the
time of death; or (4) any other proof satisfactory to the Company.
"face amount"
The initial death benefit, shown on Page 3, adjusted for any changes in
accordance with the terms of this policy.
"fixed account"
The portion of policy value invested in our general account.
"fund"
A series mutual fund.
"in force"
A term used to describe when the insured's life is covered under the terms of
this policy.
"increase age"
The age of the insured as of the effective date of an increase in face amount,
determined by the insured's last birthday.
"increase year"
A twelve month period beginning on the effective date of an increase in face
amount.
"insured"
The person upon whose life is covered by this policy as shown on Page 3.
"issue age"
The age of the insured at the time this policy was issued (issue date)
determined by the insured's last birthday.
"issue date"
The date the policy is issued, as shown on Page 3. It is used to determine
policy years and policy months in the policy.
"loan account"
An account established for amounts transferred from the subaccounts and the
fixed account as security for outstanding policy loans.
"monthly-automatic payment"
A method of making payments each month automatically; for example, by bank draft
or salary deduction.
"monthly deduction day"
The day of the month on which deductions are made. This will be the same day in
each month as the issue date, shown on Page 3. If a month does not have that
day, the deduction will be made the last day of that month.
"net"
Used in reference to the death benefit, policy value or surrender value. This
means that this item has been reduced by any policy debt.
"net death benefit"
The death benefit less any policy debt.
"net investment factor"
An index applied to measure the net investment performance of a subaccount from
one valuation date to the next. It is used to determine the policy value of a
subaccount in any valuation period.
"net policy value"
The policy value less any policy debt.
"net premium"
The gross premium less the premium expense charge.
"net surrender value"
The amount you would receive upon surrender of this policy, equal to the
surrender value less any policy debt. The net surrender value must be positive
in value for the policy to remain in force, unless the safety net premium factor
is in effect.
"payment class"
The class into which the insured is placed, determined by our rules for
providing insurance coverage.
"policy anniversary"
The same day and month as your issue date for each subsequent year your policy
remains in force.
"policy data"
The pages of this policy which identify specific information about the insured
and the benefits.
"policy debt"
The sum of all unpaid policy loans and accrued interest thereon.
"policy month"
A one month period beginning on the same day of the month as the issue date of
the policy.
"policy value"
The sum of the values of your interests in the subaccounts of the separate
account plus the value of the fixed account and the loan account. The amount
from which monthly deductions are made and the death benefit is determined.
"policy year"
A twelve month period beginning on an anniversary of the issue date.
"portfolio(s)"
The underlying mutual fund(s) (or investment series thereof) in which the
subaccounts invest.
"required payment"
The minimum premium which must be paid to keep the policy in force for the first
year.
"separate account"
A segregated investment account of the Company entitled Lincoln Benefit Life
Variable Life Account.
"subaccount"
A subdivision of the separate account invested wholly in shares of one of the
portfolios.
"surrender value"
The policy value less any applicable surrender charges.
"valuation date"
Each day the New York Stock Exchange ("NYSE") is open for business.
"valuation period"
The period commencing at the close of normal trading on the NYSE (currently 4:00
p.m. Eastern time) on each valuation date and ending at the close of the NYSE on
the next succeeding valuation date.
"we","us","our"
Our company, Lincoln Benefit Life Company.
"you"
The person(s) having the privileges of ownership defined in the policy.
DEATH BENEFIT
If the insured dies while this policy is in force, we will pay the death benefit
when we have received due proof of death. The death benefit will be based on:
1. The death benefit option in effect on the date of death; and
2. Any increases or decreases to the face amount.
The death benefit will be reduced by any policy debt less any unpaid monthly
deduction amounts occurring during a grace period. If the proceeds are not paid
within 30 days after we receive due proof of death of the insured, we will pay
interest on the proceeds. Interest will accrue at the legal rate of interest and
will accrue from the date of death until the claim is paid.
death benefit option
While the insured is alive you may choose between two death benefit options:
If you select Option 1, the death benefit will be the greater of:
a. The face amount on the date of death;
or
b. The percentage of the policy value shown in the Compliance with Federal
Laws Provision.
If you select Option 2, the death benefit will be the greater of :
a. The face amount plus the policy value on the date of death; or
b. The percentage of the policy value shown in the Compliance with Federal
Laws Provision.
The initial death benefit option selected by you is stated in the app.
change of death benefit option
At any time after the first policy year, you may request us to change the death
benefit option by writing to us. If you ask to change from Option 2 to Option 1,
the face amount will be increased by the amount of the policy value. If you ask
to change from Option 1 to Option 2, the face amount will be decreased by the
amount of the policy value.
The change will take effect on the monthly deduction day on or following the
date we receive the written request. We will provide to you an endorsement
showing the actual start date of the death benefit option change and the new
face amount. We reserve the right to limit the frequency of the death benefit
option changes made under this policy.
change of face amount
At any time after the first policy year, you may request either of the following
changes by writing us. The request will take effect on the monthly deduction day
on or following the date we approve the request:
1. Increasing the face amount. You must submit a new app for an increase in
face amount. We will require due proof that the insured is still insurable.
We reserve the right to limit the amount of any increases made under this
policy. The face amount may not be increased more than once in any 12 month
period.
2. Decreasing the face amount. A decrease in face amount will first be applied
against the most recent increase, then to the next most recent increase
successively, and finally to the initial face amount. The face amount in
effect after any decrease may not be less than $100,000. If you request a
partial withdrawal, the maximum partial withdrawal amount may not reduce
the face amount below $25,000.
We will provide you an endorsement showing the start date of any increase or
decrease and the new face amount. We reserve the right to limit the amount and
frequency of any increase or decrease in face amount.
BENEFICIARY
The beneficiary will receive the death benefit when the insured dies and we have
received due proof of death. The beneficiary is as stated in the app unless
changed.
The beneficiaries will receive the death benefits in the following order:
....Primary beneficiary, who will receive the death benefit if living when the
insured dies.
....Contingent beneficiary, who will receive the death benefit if the primary
beneficiary dies before the insured.
If a beneficiary dies at the same time as the insured or within fifteen days
thereafter, we will pay the death benefit as if that beneficiary were not living
when the insured died. If none of the named beneficiaries are living when the
insured dies, the death benefit will be paid to you.
We will pay the death benefit to the beneficiaries according to the most recent
written instruction we have received from you. If we do not have any written
instructions, we will pay the death benefit in equal shares to the beneficiaries
who are to share the funds. If there is more than one beneficiary in a class and
one of the beneficiaries predeceases you, the death benefit will be paid to the
surviving beneficiaries in that class.
You may name new beneficiaries. We will provide a form to be signed. You must
file it with us. Upon receipt, it is effective as of the date you signed the
form, subject to any action we have taken before we received it.
If you name one or more irrevocable beneficiaries, no change in the
beneficiaries and no changes which affect policy values may be made without
their consent. No beneficiary has any rights in this policy until the insured
dies.
OWNERSHIP
The insured is the owner if no other person is named in the app as owner. The
owner controls the policy during the lifetime of the insured. Unless you provide
otherwise, as owner, you may exercise all rights granted by the policy without
the consent of anyone else. If the named owner dies before the insured, then the
contingent owner named in the app is the new owner. If no owner named in this
policy is living, then the owner will be the estate of the last named owner.
You may name a new owner. We will provide a form to be signed. You must file it
with us. Upon receipt, it is effective as of the date you signed the form,
subject to any action we have taken before we received it.
You may assign this policy or an interest in it to another. You must do so in
writing and file the assignment with us. No assignment is binding on us until we
receive it. When we receive it, your rights and those of the beneficiary will be
subject to the assignment.
We are not responsible for the validity of any assignment you make.
PREMIUM PAYMENT
payments
Premiums for this policy are referred to as payments. The planned payment,
required payment and the time between payments are shown on Page 3.
Payments are flexible. This means you may change the amount of planned payments
and the time between payments. During the first year, you must pay an amount at
least as great as the required payment.
We must have received the first payment on or before the issue date. This policy
will not be in effect before this amount is received.
We will send you a reminder notice if you pay annually, semi-annually or
quarterly. You may also make a monthly-automatic payment. We may establish
limits on both the amount of payment and the time between payments.
Payments must be sent to our home office. The amount you pay will affect the
policy value. If you pay too little, the policy will stop subject to the grace
period.
allocation of premium payments
We will invest the net premium payments in the fixed account and the subaccounts
you select. You must specify your allocations on the app, in whole percents from
0% to 100%. The total allocation must equal 100%. You initially may allocate
your policy value to up to twenty-one options, counting each subaccount and the
fixed account as one option. All net premium payments not requiring underwriting
will be allocated to the subaccounts and fixed account as of the date payments
are received at our home office. Premium payments requiring underwriting will
not be credited with interest or earnings prior to the issue date. We will
allocate such net premium payments, plus earnings and less monthly deductions,
once underwriting approval is received and all outstanding requirements are
satisfied, to the subaccounts and fixed account specified on the app or your
most recent instructions. You may change the allocation percentages at any time
by writing us. Any change will be effective when we receive it.
We reserve the right to allocate premium payments to the fixed account during
the Right to Cancel Your Policy period described on Page 1 of this policy.
Transfer of premiums from the fixed account at the end of the Right To Cancel
Your Policy period will not be considered one of your free transfers.
grace period
Except as provided in the safety net premium provision below, if on any monthly
deduction day the net surrender value is determined to be less than the monthly
deduction for the current policy month, you will be given a grace period of 61
days. This policy will be in force during the grace period. If you do not make
sufficient payment by the end of the grace period, the policy will stop. If the
insured dies during the grace period, we will deduct any monthly deductions from
the amounts we pay.
We will send a written notice to the most recent address we have for you and any
assignee at least 30 days prior to the day coverage stops.
safety net premium
If total payments, less partial withdrawals and policy debt, are greater than or
equal to the sum of the monthly safety net premium times the number of months
elapsed since the issue date, then the policy is guaranteed to stay in force for
a predetermined time period as shown on Page 3, even if the net surrender value
becomes insufficient to cover monthly deductions. The safety net premium is
equal to the required payment for the first policy year.
If at any time the total payments, less partial withdrawals and policy debt, are
less than the sum of the monthly safety net premium times the number of months
elapsed, the safety net premium provision will no longer be in effect. Once it
is not in effect, it cannot be reinstated, and the policy will continue in force
only so long as its net surrender value is sufficient to pay the monthly
deductions and for any corresponding grace period.
Increases, decreases, partial withdrawals, death benefit option changes, and
additions or deletions of benefit riders, may affect the monthly safety net
premiums.
reinstatement
Prior to the death of the insured and if this policy has not been surrendered,
this policy may be reinstated provided you:
1. Make your request within five years of the date the policy entered the
grace period;
2. Give us the proof we require that the insured is still insurable in the
same payment class that the policy was issued;
3. Pay an amount large enough to cover the unpaid monthly deductions for the
grace period;
4. Make a payment sufficient to keep the policy in force for 3 policy months;
and
5. Repay or ask us to reinstate any loan.
The policy value on the reinstatement date will reflect the policy value at the
time of termination and premiums applied at the time of reinstatement. Surrender
charges will continue to be based on the original policy date.
When this policy is reinstated, a new two-year contestable period will apply
with respect to statements made in the application for reinstatement. The
contestable period is explained in the incontestability provision on Page 15.
ACCOUNT PROVISIONS
assets of the separate account
The separate account, shown on Page 3A, is a separate investment account to
which we allocate assets contributed under this and certain other life insurance
policies. We will have exclusive and absolute ownership and control of the
assets of our separate accounts. The assets of the separate account will be
available to cover the liabilities of our general account only to the extent
those assets exceed the liabilities of that separate account arising under the
variable life policies supported by that separate account.
The assets of the separate account will be valued at least as often as any
policy benefits vary, but at least monthly. Our determination of the value of
the accumulation unit by the method described in this policy will be conclusive.
assets of the fixed account
At any time while this policy is in force, you may allocate premiums, or
transfer from an existing subaccount, to a fixed account. The fixed account will
earn interest at the current rate declared by us, on the monthly deduction day.
The rates we declare are effective annual interest rates. This means we credit
interest at a rate which compounds over one year to the interest rate we
declare. The minimum guaranteed monthly interest rate used to compute policy
values in the fixed account is shown on Page 3A. Compounded monthly, this is the
same as the minimum guaranteed annual interest rate shown on Page 3A. We may use
an interest rate greater than the minimum guaranteed interest rate, but are not
obligated to do so.
transfer and transfer fees
You may transfer amounts between subaccounts and/or the fixed account. We
reserve the right to impose a $10 transfer fee on the second and subsequent
transfers within a calendar month, and to impose a minimum size on transfer
amounts as shown on page 3A, and to limit the number of transfers in any policy
year. Additional restrictions apply to transfers from/to the fixed account as
discussed below.
Transfers from the fixed account to the subaccounts may only be made during the
60 day period beginning on the issue date or the policy anniversary. Transfer
requests received at any other time will not be processed. The maximum amount
which may be transferred from the fixed account during a policy year is the
greater of:
1. 30% of the fixed account balance as of the last policy anniversary; or
2. the greatest amount of any prior transfer from the fixed account.
At any time, without notice, we may suspend, modify or terminate your privilege
to make transfers via the telephone or via other electronic or automated means.
We reserve the right to refuse any transfer request for an owner or certain
owners if, in our sole discretion:
o We believe that excessive trading by such owner or owners or a specific
transfer request or group of transfer requests may have a detrimental
effect on unit values or the share prices of the underlying mutual funds or
would be to the disadvantage of other policy owners; or
o We are informed by one or more of the underlying mutual funds that the
purchase of shares is to be restricted because of excessive trading or a
specific transfer or group of transfers is deemed to have a detrimental
effect on share prices of affected underlying mutual funds.
Such restrictions may also be applied in any other manner reasonably designed to
prevent any use of the transfer right which is considered by us to be to the
disadvantage of other policy owners.
separate account modifications
We reserve the right, subject to applicable law, to make additions to, deletions
from, or substitutions for the mutual fund shares underlying the subaccounts of
the separate account. We will not substitute any share attributable to your
interest in a subaccount without notice to you and prior approval of the
Securities and Exchange Commission, to the extent required by the Investment
Company Act of 1940, and the Nebraska Insurance Commissioner. The approval
process is on file with the insurance commissioner of the state where this
policy is delivered.
We reserve the right to establish additional subaccounts of the separate
account, each of which would invest in shares of another portfolio of the mutual
fund or another mutual fund. You may then instruct us to allocate premium
payments or transfers to such subaccounts, subject to any terms set by us or the
mutual fund.
In the event of any such substitution or change, we may by endorsement make such
changes as may be necessary or appropriate to reflect such substitution or
change.
If we deem it to be in the best interests of persons having voting rights under
the policies, the separate account may be operated as a management company under
the Investment Company Act of 1940 or it may be deregistered under such Act in
the event such registration is no longer required.
POLICY VALUE
On the issue date or, if later, the date the first premium is received, the
policy value is the net premium less the monthly deduction for the first policy
month.
On any other day, the policy value is the sum of the values in each subaccount,
plus the value of the fixed account and the loan account.
On each valuation date, the value in a subaccount is:
1. The value of the subaccount on the preceding valuation date, multiplied by
the net investment factor for the subaccount for the current valuation
period, plus
2. Any net premium received and allocated to the subaccount during the current
valuation period, plus
3. Any policy value transferred to the subaccount during the current valuation
period, minus
4. Any policy value transferred from the subaccount during the current
valuation period, minus
5. Any partial withdrawals from the subaccount during the current valuation
period, minus
6. The portion of any monthly deduction allocated to the subaccount during the
current valuation period for the policy month following the monthly
deduction day.
The value in the fixed account equals:
1. Any net premiums allocated to it, plus
2. Any policy value transferred to it from the subaccounts, plus
3. Interest credited to it, minus
4. Any policy value transferred out of it, minus
5. Any partial withdrawals taken from it, minus
6. Any monthly deduction charge taken from it.
All policy values equal or exceed those required by law. Detailed explanations
of methods of calculation are on file with appropriate regulatory authorities.
net investment factor
The net investment factor measures investment performance of a subaccount during
a valuation period. The net investment factor is (1) divided by (2) where:
1. is the net result of:
a. the net asset value per share of the portfolio held in the subaccount
at the end of the current valuation period, plus
b. the per share amount of any dividend or capital gain distribution made
by the portfolio during the current valuation period, plus or minus
c. a per share credit or charge with respect to any taxes which we paid
or for which we reserved during the valuation period which are
determined by us to be attributable to the operation of the subaccount
(no federal income taxes are applicable under present law).
2. is the net asset value per share of the portfolio held in the subaccount at
the end of the last prior valuation period.
premium expense charge
Upon receipt of each payment and before allocation of the payment to the
subaccounts or fixed account, we will deduct a premium expense charge. This
charge, shown on Page 3A, is a percentage of the premium received.
administrative expense charge
The monthly administrative expense charge is equal to the administrative expense
charge rate shown on Page 3A for the appropriate policy year, divided by 12,
times the initial face amount, divided by 1000. This charge covers
administration expenses and issuance costs.
A monthly administrative expense charge will also be assessed for each increase
in face amount based on the effective date of each increase. The applicable
charge is equal to the amount of increase times the rate shown on Page 3A for
the appropriate policy year divided by 12, divided by 1000.
monthly deductions
The monthly deduction is the sum of:
1. A policy fee as shown on Page 3A;
2. The administrative expense charge;
3. The mortality and expense risk charge;
4. The cost of insurance for the policy; and
5. The cost of any benefit riders attached to the policy.
No cost of insurance charge, administrative expense charge, or policy fee will
be assessed after the policy anniversary following the insured's 100th birthday.
risk charge
The monthly mortality and expense risk charge is equal to the annual mortality
and expense risk rate shown on Page 3A for the appropriate policy year, divided
by 12, times the total value in the subaccount on the monthly deduction day.
Specifically, we bear the risk that the total amount of death benefits payable
will be greater than anticipated, and we also assume the risk that the actual
cost we incur to administer the policy will not be covered by administrative
charges assessed.
cost of insurance
The cost of insurance is determined as follows:
1. Divide the death benefit as of the prior monthly deduction day by
1.00327374.
2. Subtract the policy value as of that prior monthly deduction day, and
divide the result by 1000;
3. Multiply the results by the current cost of insurance rate. The cost of
insurance rate is based on the insured's sex, issue age, policy year, and
payment class. The rates will be determined by us, but they will never be
more than the guaranteed rates shown on Page 5.
SURRENDER VALUE
You may terminate your policy for its net surrender value, which may be paid in
cash or under an income plan.
The net surrender value of this policy is the amount we will pay you if you ask
us to stop this policy. It is equal to the policy value less the surrender
charge less any policy debt. If the surrender charge is greater than the policy
value, the surrender value is zero.
Termination will be effective on the date we receive your written request. We
may require that your policy accompany your written request before making any
payment.
surrender charge
The maximum surrender charges we will assess, based on the face amount at issue,
are shown in the Surrender Charge Schedule on Page 4. An additional layer of
surrender charge will apply to an elective increase in face amount. The new
layer of surrender charge will be positive for fourteen years from the effective
date of the increase. The initial surrender charge on an increase is an amount
per thousand of increase which varies by increase age, as shown in the Table on
Page 4. The charge for any increase year can be calculated from the Table on
Page 4 as follows:
1. The amount per $1000 of increase, times
2. The increase amount divided by 1000, times
3. The Surrender Charge Percentage.
continuation of coverage
If you stop making payments, this policy and any riders will remain in effect as
long as the net surrender value covers the monthly deductions or the policy is
still in force as defined in the monthly guarantee premiums provision. This
provision does not continue any riders beyond their normal termination dates.
partial withdrawal
You may request a partial withdrawal of your net surrender value after the first
policy year by writing to us. Your partial withdrawal will be effective on the
next valuation date. You may specify how much of your partial withdrawal you
wish taken from each subaccount or from the fixed account. However, you may not
withdraw from the fixed account more than the total withdrawal times the ratio
of the fixed account to your total policy value immediately pror to the
withdrawal. The partial withdrawal service fee, as shown on Page 3A, may be
deducted from the subaccounts and fixed accounts in the same proportion as the
partial withdrawal.
The policy value will be reduced by the amount of any partial withdrawal. Any
policy with Death Benefit Option 1 will also have a reduction in the face
amount. The minimum partial withdrawal amount is shown on Page 3A and the
maximum partial withdrawal amount may not reduce the net surrender value below
$500. In addition, the maximum partial withdrawal amount may not reduce the face
amount below $25,000.
basis of values
Minimum surrender values are based on the 1980 CSO Mortality Table, age last
birthday, male or female, smoker or nonsmoker, as appropriate. The minimums are
not less than those required by the state in which the app is signed.
LOANS
You may have a loan if you assign this policy to us as sole security. The amount
of any loan request must not be such that the total amount of outstanding loans,
loan interest, plus the requested loan exceeds 90% of the surrender value.
We will ordinarily disburse proceeds of policy loans within seven days from the
date of receipt of a request for a loan at our home office, although payments
may be postponed under certain circumstances as detailed in the "deferment of
payments" section on Page 17. As long as the policy remains in force, the loan
may be repaid in whole or in part without penalty at any time while the insured
is living.
loan interest
An amount equal to your policy value less all premiums paid may be taken as a
preferred loan. The annual loan interest rate charged for preferred loans is
shown on Page 3A. A standard loan is the amount that may be borrowed from the
sum of premiums paid. The annual loan interest rate for standard loans is shown
on Page 3A.
Interest on policy loans accrues daily and is due at the end of each policy
year. Any interest not paid when due becomes part of the policy loan and will
bear interest at the rates described in this provision.
When a policy loan is made, a portion of the policy value sufficient to secure
the loan will be transferred to the loan account reducing the policy value in
the separate account. Any loan interest that is due and unpaid will also be so
transferred. All loan amounts will be transferred from the subaccounts and the
fixed account to the loan account in the same allocation percentages as
specified for premium payments. However, we will not withdraw loan amounts from
the fixed account equaling more than the total loan multiplied by the ratio of
the fixed account to your total account value immediately prior to the loan.
Xxxxxxx transferred to the loan account will no longer be affected by the
investment experience of the separate account and will instead accrue interest
at the annual loan credited rate as shown on Page 3A.
loan repayment
You may pay back your loan and loan interest at any time. If you do not, we will
deduct the loan and loan interest from the amounts we pay.
If your loan and loan interest exceed the surrender value, this policy will stop
except as provided in the grace period section. We must mail a notice to you and
all assignees at least 30 days before the policy stops.
OTHER TERMS OF YOUR POLICY
our contract with you
These pages and the signed app are your entire contract with us. We issued it
based upon your app and the payment made by you. A copy of the app is included.
Any supplemental app will also be attached to and made a part of the contract.
We will not use any statements, except those made in the app and any
supplemental app, to challenge any claim or to avoid any liability under this
policy. The statements made in the app will be treated as representations and
not as warranties.
Only our officers have authority to change this policy. No agent may do this.
Any change must be written.
when protection starts
The issue date is the date when this policy becomes effective if the insured is
then living and the first payment has been made.
termination
This policy will terminate upon the earliest of the following events:
1. Surrender of the policy; or
2. End of the grace period; or
3. Death of the insured.
misstatement of age or sex
If the insured's age or sex shown on the app has been misstated, any proceeds
will be adjusted to the amount which the initial safety net premium would have
purchased at the correct age and sex.
incontestability
Except as provided in the next provision or in any attached rider with an
incontestability provision, we may not contest this policy once it has been in
force while the insured is alive for 2 years from its issue date except for
failure to make payments that cause the net surrender value to be too small to
cover the monthly deductions required to keep this policy and its riders in
force.
We may not contest any increase in face amount once it has been in force while
the insured is alive for 2 years from the effective date of the increase.
We may not contest any reinstatement of this policy or any benefit riders after
they have been in force while the insured is alive for two years from the
reinstatement date.
If the policy is rescinded under this provision:
1. We will only pay an amount equal to the policy value less any policy debt;
and
2. The policy will stop.
suicide or self-destruction
If the insured dies by suicide while sane or self destruction while insane
within 2 years from the issue date of the policy:
1. We will only pay an amount equal to the policy value less any policy debt;
and
2. The policy will stop.
If the insured dies by suicide while sane or self-destruction while insane
within two years of the effective date of any increase in face amount, our
liability with respect to the increase will be limited to the cost of insurance
for the increase.
annual report
Each year we will send you an annual report following the policy anniversary.
Each report will provide information on various transactions that took place
during the policy year just completed, as well as information on the current
status of the policy. This information will include items such as:
1. The policy value as of the end of the current and prior year.
2. Payments and withdrawals made during the year.
3. The monthly deductions and expense charges made during the year.
4. Earnings during the year.
5. The current death benefit.
6. The current surrender charges and surrender value.
7. The amount of policy debt.
8. Such additional information as required by applicable law or regulation.
If you ask us, we will send you an additional report at any time during the
policy year. We may charge you for this extra report, but the charge will be no
more than $25. We will tell you what the current charge is before sending the
report.
conformity with state law
This policy is subject to the laws of the state where the app was signed. If any
part of the policy does not comply with the law, it will be treated by us as if
it did.
nonparticipating
This policy is nonparticipating. It does not share in our profits or surplus
earnings. We will pay no dividends on this policy.
compliance with federal laws
The two requirements below are intended to maintain the status of this policy as
life insurance under the current Internal Revenue Code:
First, the amount of payments that you may pay is limited by law. We will
conduct a test no less frequently than annually, and return any excess payments.
Second, the death benefit payable may not be less that the applicable percentage
of your policy value. This percentage is based on the attained age as shown in
the table below:
Attained Applicable
Age Percentage
0 to 40 250
41 243
42 236
43 229
44 222
45 215
46 209
47 203
48 197
49 191
50 185
51 178
52 171
53 164
54 157
55 150
56 146
57 142
58 138
59 134
60 130
61 128
62 126
63 124
64 122
65 120
66 119
67 118
68 117
69 116
70 115
71 113
72 111
73 109
74 107
75 to 90 105
91 104
92 103
93 102
94 and above 101
We will conduct a test monthly and increase the death benefit, subject to our
then current underwriting limits, to be equal to the applicable percentage of
your policy value, if necessary. The death benefit will remain at that level
unless it has to be increased again. If we cannot increase the death benefit due
to underwriting limits, we will return the amount of policy value necessary so
that the death benefit will be equal to the applicable percentage of your policy
value after returning the amount.
We will perform any necessary action within 60 days of the end of the policy
year in which the requirement has not been met.
We reserve the right to amend the policy to comply with:
1. Future changes in the Internal Revenue Code;
2. Any regulations or rulings issued under the code; and
3. Any other requirements imposed by the Internal Revenue Service.
We will give you a copy of any such amendment.
payment of proceeds
The net death benefit, or the net surrender value in the event you withdraw it,
will be paid in one sum or applied to any settlement option we then provide.
When we pay the proceeds, we may ask that you give this policy back to us. No
surrenders or partial withdrawals are permitted after payments under a
settlement option have started.
Settlement options will include:
1. We will hold the proceeds at interest, and pay out the funds when the
person entitled to them requests.
2. We will pay a selected monthly income until the proceeds, with interest,
are exhausted.
3. We will pay a monthly income, based upon the amount of proceeds, interest
rate and the age and sex of the person or persons receiving the funds, for
a selected period or the lifetime of the person or persons to whom the
funds are being paid.
At the time the proceeds are payable, we will inform you concerning the rate of
interest to be paid on funds left with us. We guarantee that the rate of
interest will not be less than 3%. We may pay interest in excess of the
guaranteed rate. We will issue a supplementary contract setting forth the
benefits to be paid and the rights of the beneficiary. Each election must
include at least $5,000.00 of policy proceeds and must result in installment
payments of not less than $50.00.
deferment of payments
We will pay any amounts due under the separate account of this policy within
seven days, unless:
o The New York Stock Exchange is closed for other than usual weekends or
holidays, or trading on such exchange is restricted;
o An emergency exists as defined by the Securities and Exchange Commission;
or
o The Securities and Exchange Commission permits delay for the protection of
policy holders.
In addition, we may defer payment of any net surrender value in the fixed
account for up to 6 months after you ask for it. If we defer payment for more
than 30 days we will add interest at our current rate from the time you asked
for such surrender value.
EXCHANGE OF PLAN
If this policy is in force, you may exchange it during the first two policy
years after the policy date or within two years of an increase in face amount,
for a policy in which values do not vary with the investment experience of the
separate account. This exchange will be implemented by transferring your policy
value to the fixed account and removing your future right to allocate funds to
the separate account. We may require you to return this policy to us to amend
before this exchange will be processed. This transfer will not be subject to the
excess transfer fee.
FLEXIBLE PREMIUM VARIABLE LIFE POLICY
Minimum Premium Required in the First Year
Death Benefit Payable on the Insured's Death
Flexible Premiums Payable for Life
The Death Benefit and other Values provided by
this Policy are based on the investment experience
of the Separate Account,
the fixed account earnings, and other flexible factors.
These values may vary based on investment and
earnings experience and are not guaranteed as
to a fixed dollar amount.
Nonparticipating
VUL 0231
Additional Insured Term Insurance Benefit Rider
AR 9402
benefit
We will pay the amount insured provided by this rider when we receive proof that
the additional insured died while this rider was in force. The additional
insured and the death benefit for this rider are shown in the Policy Data.
beneficiary
Any amount payable under this rider upon the death of an additional insured will
be paid to you, unless otherwise provided. If you are deceased, payment will be
made to the estate of such additional insured.
exchange of this rider
Prior to the additional insured's 75th birthday, you may exchange this rider for
a new policy insuring the life of the additional insured. The exchange will be
made on the following conditions:
1. This rider must be in force when you make the exchange.
2. The request for exchange must be written.
3. The new policy selected by you must be a whole life plan, or flexible
premium adjustable life plan, then sold by us.
4. The death benefit of the new policy will not be greater than the death
benefit of this rider on the date of exchange, but never less than $10,000.
5. The issue date of the new policy will be the date of exchange.
6. The premium for the new policy will be based on the additional insured's
sex, attained age and the payment class applicable to this rider. No new
evidence of insurability will be required.
7. Any benefit riders providing additional benefits in the event of disability
or death will be made a part of the new policy only with our consent.
In addition, a special exchange provision will be allowed to any additional
insured if the policy stops due to the death of the insured or because the
insured reached age 99. This special exchange will be allowed regardless of the
age of the additional insured. All other conditions listed above will still
apply.
when this rider stops
This rider will stop:
1. on the monthly activity day next following the additional insured's 99th
birthday; or
2. when this rider is exchanged as provided; or
3. on the monthly activity day after you make a written request; or
4. when the policy stops.
basis of computations
The reserves for this rider are computed upon the Commissioners 1980 Standard
Ordinary Mortality Table, interest as prescribed in the Standard Valuation Law,
the insured's age last birthday, and the assumption that deaths occur at the end
of policy years.
other terms of this rider
1. This rider is made a part of the policy on the issue date, and except as
provided is subject to all terms of the policy.
2. The cost for this rider is included in the monthly deductions. The amount
of deductions required will never exceed the rates shown in the Policy
Data.
The issue date of this rider is the issue date of the policy unless a later date
is stated here:
Lincoln Benefit Life Company
/s/ B. Xxxxxx Xxxxxx
B. Xxxxxx Xxxxxx
President
VUL 0222
Primary Insured Term Insurance Benefit Rider
AR 9402
benefit
We will pay the death benefit provided by this rider if we pay the policy death
benefit and this rider was in force when the insured died. The death benefit for
this rider is shown in the Policy Data.
beneficiary
You may name a different beneficiary to receive the benefit for this rider.
Otherwise we will pay it to the beneficiary for the policy death benefit.
when this rider stops
This rider will stop:
1. on the monthly activity day next following the insured's 99th birthday; or
2. when this rider is exchanged as provided; or
3. on the monthly activity day after you make a written request; or
4. when the policy stops.
exchange of this rider
Prior to the insured's 75th birthday, you may exchange this rider for a new
policy. The exchange will be made on the following conditions.
1. This rider must be in force when you make the exchange.
2. The request for exchange must be written.
3. The new policy selected by you must be a whole life plan, or flexible
premium adjustable life plan, then sold by us.
4. The death benefit of the new policy will not be greater than the death
benefit of this rider on the date of exchange, but never less than $10,000.
5. The issue date of the new policy will be the date of exchange.
6. The premium for the new policy will be based on the insured's sex, attained
age and the payment class applicable to this rider. No new evidence of
insurability will be required.
7. Any benefit riders providing additional benefits in the event of disability
or death will be made a part of the new policy only with our consent.
In addition, on or after the first policy anniversary and prior to the insured's
75th birthday, you may exchange this rider to the base policy for permanent
coverage. Conditions 1 and 2 above apply together with the following:
o The face amount of the policy will be increased by an amount you
choose, but not greater than the benefit provided by this rider.
o The start date of the increase in face amount will be the date of exchange.
The rider will stop at that time.
o The required premium, additional surrender charge and cost of insurance
deduction for the increase in face amount will be based on the insured's
sex, attained age and payment class applicable to this rider. No new
evidence of insurability will be required.
basis of computations
The reserves for this rider are computed upon the Commissioners 1980 Standard
Ordinary Mortality Table, interest as prescribed in the Standard Valuation Law,
the insured's age last birthday, and the assumption that deaths occur at the end
of policy years.
other terms of this rider
1. This rider is made a part of the policy on the issue date, and except as
provided is subject to all terms of the policy.
2. The cost for this rider is included in the monthly deductions. The amount
of deductions required will never exceed the rates shown in the Policy
Data.
The issue date of this rider is the issue date of the policy unless a later date
is stated here:
Lincoln Benefit Life Company
/s/ B. Xxxxxx Xxxxxx
B. Xxxxxx Xxxxxx
President
