Document/Exhibit Description Pages Size
1: 485BPOS Registration Statement With Exhibits 6 32K
2: EX-99.A Exhibit A 2 18K
3: EX-99.B Exhibit B 2 13K
4: EX-99.C.(1) Exhibit C(1) 23 93K
5: EX-99.C.(2) Exhibit C(2) 23 92K
6: EX-99.C.(3) Exhibit C(3) 6 28K
13: EX-99.D(7) Exhibit D(7) 5 15K
7: EX-99.D.(1) Exhibit D(1) 7± 28K
8: EX-99.D.(2) Exhibit D(2) 4 24K
9: EX-99.D.(3) Exhibit D(3) 5 14K
10: EX-99.D.(4) Exhibit D(4) 3 12K
11: EX-99.D.(5) Exhibit D(5) 5 14K
12: EX-99.D.(6) Exhibit D(6) 2 10K
14: EX-99.E(1) Exhibit E(1) 6 27K
15: EX-99.E.(2) Exhibit E(2) 2 10K
16: EX-99.F Exhibit F 10± 36K
EXHIBIT C(1)
Form of Flexible Premium Variable Life Insurance Policy (2VUL1294NY)
80 Pine Street
New York, New York 10270
A capital stock company
We agree to pay the Insurance Benefit of this Policy and to provide its other
benefits and rights in accordance with its provisions.
Flexible Premium Variable Life Insurance Policy
This is a flexible premium variable life insurance policy. You can, within
limits: o increase or decrease the Face Amount; o pay Premium at any
time and in any amount; o change the Death Benefit Option; o change the
allocation of Net Premiums among Your investment options; and o
transfer amounts among Your investment options.
All of these rights and benefits are subject to the terms and conditions of this
Policy. All requests for Policy changes are subject to Our approval and may
require evidence of insurability.
We will put Your Net Premiums paid prior to the Allocation Date into the Money
Market Subaccount. On the Allocation Date all such Premiums will then be
allocated in accordance with directions contained in Your Policy application.
The portion of Your Policy Account Value that is in a Subaccount will vary up or
down depending on the unit value of such Subaccount, which in turn depends on
the investment performance of the corresponding portfolio of a designated
investment company. There are no minimum guarantees as to such portion of Your
Policy Account Value.
The portion of Your Policy Account Value that is in Our Guaranteed Account will
accumulate, after deductions, at rates of interest We determine. Such rates will
not be less than 4% per year, compounded annually.
The amount and duration of the Death Benefit may be variable or fixed as
described in this Policy.
Please Read This Policy With Care. A Table Of Contents is on Page 2. A policy
summary is also on Page 2.
Right To Examine This Policy. You may examine this Policy and if for any reason
You are not satisfied with it You may cancel it by returning this Policy with a
written request for cancellation to Our Administrative Office no later than the
later of (a) 10 days after You receive it; or (b) 45 days after the application
was signed. If You do this, We will refund the Premiums that were paid on this
Policy.
/s/ Elizabeth M. Tuck /s/ RJ O'Connell
Elizabeth M. Tuck RJ O'Connell
Secretary President
CONTENTS
Policy Summary 2
Policy Information 3
Table Of Expense Charges 4
Table Of Maximum Surrender Charges 5
Table Of Guaranteed Maximum Cost Of Insurance Rates 6
Definitions 7
Policy Owner And Beneficiary Provisions 9
The Benefits We Pay 9
Changing The Face Amount Or The Death Benefit Option 11
The Premiums You Pay 12
Your Policy Account Value And How It Works 13
Your Investment Options 14
Your Policy Account Value 15
The Cash Surrender Value Of This Policy 16
How A Loan Can Be Made 18
Our Separate Account 19
Our Annual Report To You 19
How Benefits Are Paid 20
Other Important Information 20
A copy of the application for this Policy and any additional benefit riders are
at the back of this Policy.
POLICY SUMMARY
The Premiums You pay into this Flexible Premium Variable Life Insurance
Policy, after deductions are made in accordance with the Table Of Expense
Charges in the Policy Information section, are put into Your Policy Account
Value. Amounts in Your Policy Account Value are allocated at Your direction
to one or more Subaccounts and to Our Guaranteed Account.
The Subaccounts invest in shares of registered investment companies whose
value is subject to market fluctuations and investment risk. There is no
guarantee of principal or investment experience.
The Guaranteed Account earns interest at rates We declare in advance. The
rates are guaranteed not to be less than 4% per year, compounded annually.
The principal, after deductions, is also guaranteed.
The duration of life insurance coverage depends upon the Net Cash Surrender
Value.
If Death Benefit Option I is in effect, the Death Benefit is the Face
Amount, and the amount of the Death Benefit is fixed except when it is a
percentage of Your Policy Account Value. If Death Benefit Option II is in
effect, the Death Benefit is the Face Amount plus Your Policy Account
Value. The amount of the Death Benefit under Death Benefit Option II is
variable.
We make monthly deductions from Your Policy Account Value to cover the cost
of the benefits provided by this Policy. If You give up this Policy for its
Net Cash Surrender Value, make a Partial Surrender, reduce the Face Amount,
or if this Policy ends without value at the end of the Grace Period, We may
deduct a surrender charge from Your Policy Account Value.
This is only a summary of what this Policy provides. You should read the
entire Policy carefully. Its terms govern Your rights and Our obligations.
POLICY INFORMATION
INSURED PERSON [JOHN DOE] AGE [35] SEX [MALE] [N O N S M O K E R]
OWNER [JOHN DOE]
FACE AMOUNT [$100,000]
DEATH BENEFIT OPTION [I] (SEE PAGE 10)
POLICY NUMBER [XX XXX XXX]
BENEFICIARY [JANE DOE]
POLICY DATE [JANUARY 1, 1995]
ISSUE DATE [JANUARY 1, 1995]
INSURED PERSON'S
STATE OF RESIDENCE [SPECIMEN]
SEPARATE ACCOUNT [VARIABLE ACCOUNT II]
PARTIAL SURRENDER MINIMUM PARTIAL SURRENDER IS $500
POLICY LOAN MINIMUM LOAN IS $500
POLICY LOAN
INTEREST RATE 8%
TRANSFER MINIMUM TRANSFER AMOUNT IS $250
AN INITIAL PREMIUM OF [$800.00] IS DUE ON OR BEFORE DELIVERY OF THE POLICY.
[THE PLANNED PERIODIC PREMIUM OF [$800.00] IS PAYABLE [QUARTERLY]]. THE MINIMUM
PREMIUM WHICH WE WILL ACCEPT AT ANY TIME IS [$50].
THE LOANED PORTION OF YOUR POLICY ACCOUNT VALUE IS ELIGIBLE FOR INTEREST AT 6%.
HOWEVER, AT THE BEGINNING OF THE 11TH POLICY YEAR AND THEREAFTER, THE PORTION OF
THE LOAN WHICH IS CONSIDERED PREFERRED, WILL BE ELIGIBLE FOR INTEREST AT 8%.
THIS IS DESCRIBED IN THE PROVISIONS ENTITLED YOUR VALUE IN OUR GUARANTEED
ACCOUNT ON PAGE 16 AND PREFERRED LOAN VALUE ON PAGE 18.
ANY ADDITIONAL BENEFIT ARE RIDERS LISTED BELOW.
THE PREMIUM SHOWN ABOVE MAY NOT BE SUFFICIENT TO CONTINUE THE POLICY AND LIFE
INSURANCE COVERAGE TO THE MATURITY DATE, WHICH IS THE POLICY ANNIVERSARY
FOLLOWING THE INSURED PERSON'S ATTAINED AGE 99. THE PERIOD FOR WHICH THE POLICY
AND COVERAGE WILL CONTINUE IN FORCE WILL DEPEND ON: (1) THE TIMING, FREQUENCY,
AND AMOUNT OF PREMIUM; (2) CHANGES IN THE FACE AMOUNT AND THE DEATH BENEFIT
OPTIONS; (3) CHANGES IN THE INTEREST RATES CREDITED TO OUR GUARANTEED ACCOUNT
AND IN THE INVESTMENT PERFORMANCE OF THE SUBACCOUNTS; (4) CHANGES IN THE MONTHLY
COST OF INSURANCE DEDUCTIONS FROM THE POLICY ACCOUNT VALUE FOR THIS POLICY AND
ANY BENEFITS PROVIDED BY RIDERS TO THIS POLICY; AND (5) LOAN AND PARTIAL
SURRENDER ACTIVITY.
POLICY INFORMATION CONTINUED
TABLE OF EXPENSE CHARGES
DEDUCTIONS FROM PREMIUMS:
CHARGE FOR APPLICABLE TAXES (OTHER THAN TAXES DISCUSSED ON PAGE 15):
2.00% OF EACH PREMIUM PAYMENT. THIS AMOUNT IS SUBTRACTED FROM EACH
PREMIUM PAYMENT. WE RESERVE THE RIGHT TO CHANGE THIS PERCENTAGE TO
CONFORM TO CHANGES IN THE LAW OR IF THE OWNER CHANGES PLACE OF
RESIDENCE.
PREMIUM CHARGE.
5.00% OF EACH PREMIUM. WE RESERVE THE RIGHT TO CHANGE THIS CHARGE BUT
IT WILL NEVER BE MORE THAN 5.00%.
DEDUCTIONS FROM YOUR POLICY ACCOUNT VALUE:
ADDITIONAL FIRST YEAR ADMINISTRATIVE CHARGE:
$20.00 IS DEDUCTED AT THE BEGINNING OF EACH POLICY MONTH DURING THE
FIRST POLICY YEAR. WE RESERVE THE RIGHT TO CHANGE THIS CHARGE BUT IT
WILL NEVER BE MORE THAN $25.00 A MONTH.
ADMINISTRATIVE CHARGE:
$7.50 IS DEDUCTED AT THE BEGINNING OF EACH POLICY MONTH DURING EACH
POLICY YEAR. WE RESERVE THE RIGHT TO CHANGE THIS CHARGE BUT IT WILL
NEVER BE MORE THAN $15.00 A MONTH. CHANGES WILL BE AS DESCRIBED IN
"CHANGES IN POLICY COST FACTORS: ON PAGE 20.
PARTIAL SURRENDER;
$25.00 IS DEDUCTED WHENEVER THERE IS A PARTIAL SURRENDER. THERE ALSO
MAY BE A PARTIAL SURRENDER CHARGE AS DESCRIBED IN "PARTIAL SURRENDER"
ON PAGE 17.
INCREASES IN FACE AMOUNT THAT YOU ASK FOR:
$20.00 A MONTH IS DEDUCTED FOR THE 12 MONTHS IMMEDIATELY FOLLOWING THE
EFFECTIVE DATE OF THE INCREASE. WE RESERVE THE RIGHT TO CHANGE THIS
CHARGE BUT IT WILL NEVER BE MORE THAN $25.00 A MONTH.
TRANSFERS:
WE RESERVE THE RIGHT TO DEDUCT UP TO $25.00 FOR EACH TRANSFER OF
AMOUNTS AMONG YOUR INVESTMENT OPTIONS. HOWEVER WE WILL NOT MAKE A
CHARGE FOR THE FIRST 12 TRANSFERS IN ANY POLICY YEAR.
[Download Table]
POLICY INFORMATION CONTINUED
TABLE OF MAXIMUM SURRENDER CHARGES
POLICY MINIMUM POLICY MINIMUM
YEAR FACTOR CHARGE YEAR FACTOR CHARGE
1 100% $1,086.94 9 60% $652.16
2 100% $1,086.94 10 50% $543.47
3 100% $1,086.94 11 40% $434.78
4 100% $1,086.94 12 30% $326.08
5 100% $1,086.94 13 20% $217.39
6 90% $978.25 14 10% $108.69
7 80% $869.55 15 0% $0.00
8 70% $760.86
A SURRENDER CHARGE WILL BE SUBTRACTED FROM YOUR POLICY ACCOUNT VALUE IF THIS
POLICY IS SURRENDERED FOR ITS NET CASH SURRENDER VALUE OR IF THIS POLICY
TERMINATES WITHIN THE FIRST FOURTEEN POLICY YEARS. A PARTIAL SURRENDER CHARGE
WILL ALSO BE SUBTRACTED FROM YOUR POLICY ACCOUNT VALUE IF YOU MAKE A PARTIAL
SURRENDER OF THIS POLICY. THE MAXIMUM CHARGE AT ANY TIME IN A POLICY YEAR IS
EQUAL TO THE LESSER OF (1) THE CHARGE SHOWN IN THE TABLE ABOVE FOR THAT YEAR; OR
(2) AN AMOUNT EQUAL TO (A) TIMES (B) WHERE (A) IS 25% OF THE FIRST $1,025 IN
PREMIUM RECEIVED DURING THE FIRST POLICY YEAR, PLUS 4% OF ALL OTHER PREMIUM
RECEIVED DURING THE FIRST POLICY YEAR; AND (B) IS THE FACTOR IN THE TABLE ABOVE
FOR THAT YEAR.
THIS TABLE ASSUMES NO FACE AMOUNT INCREASES. SEE PAGE 17 FOR A DESCRIPTION OF
SURRENDER CHARGES FOR FACE AMOUNT INCREASES.
IN THE FACE AMOUNT IS REDUCED WITHIN THE FIRST FOURTEEN POLICY YEARS, A PRO RATA
SHARE OF THE APPLICABLE SURRENDER CHARGE AT THAT TIME MAY BE DEDUCTED FROM YOUR
POLICY ACCOUNT VALUE. SEE PAGE 17 FOR A DESCRIPTION OF THE PRO RATA SURRENDER
CHARGE.
RIGHT TO CHANGE POLICY COST FACTORS
ADDITIONAL AMOUNTS NOT GUARANTEED
SUBJECT TO MINIMUM GUARANTEED INTEREST RATES, MAXIMUM EXPENSE CHARGES AND
GUARANTEED MAXIMUM COST OF INSURANCE RATES, WE HAVE THE RIGHT TO CHANGE: (1) THE
RATE OF INTEREST CREDITED TO THE AMOUNT YOU HAVE IN OUR GUARANTEED ACCOUNT; (2)
THE MONTHLY COST OF INSURANCE RATE AND (3) EXPENSE CHARGES DEDUCTED UNDER THE
POLICY, WHICH MAY REQUIRE MORE PREMIUM TO BE PAID THAN WAS ILLUSTRATED, OR MAY
RESULT IN POLICY VALUES BEING LESS THAN THOSE ILLUSTRATED.
[Enlarge/Download Table]
POLICY INFORMATION CONTINUED
TABLE OF GUARANTEED MAXIMUM COST OF INSURANCE RATES
GUARANTEED MAXIMUM MONTHLY RATES PER $1,000
OF NET AMOUNT AT RISK (SEE PAGE 13)
------------------- --------------------------------- ---------------------- ------------------------------------
Attained Monthly Attained Monthly
Age Rate Age Rate
------------------- --------------------------------- ---------------------- ------------------------------------
35 0.14419 68 2.49957
36 0.15169 69 2.75591
37 0.16169 70 3.04592
38 0.17253 71 3.37720
39 0.18420 72 3.75992
40 0.19837 73 4.19334
41 0.21338 74 4.67004
42 0.22922 75 5.18003
43 0.24673 76 5.71919
44 0.26590 77 6.28340
45 0.28758 78 6.87612
46 0.31093 79 7.51607
47 0.33595 80 8.22375
48 0.36347 81 9.01810
49 0.39349 82 9.91569
50 0.42768 83 10.91280
51 0.46688 84 11.99040
52 0.51193 85 13.12418
53 0.56365 86 14.29994
54 0.62122 87 15.49991
55 0.68547 88 16.71910
56 0.75557 89 17.97489
57 0.82985 90 19.28574
58 0.91250 91 20.68243
59 1.00518 92 22.21791
60 1.10873 93 24.04369
61 1.22400 94 26.50346
62 1.35684 95 30.20740
63 1.50727 96 36.35803
64 1.67447 97 47.21180
65 1.85761 98 66.20701
66 2.05588 99 90.90909
67 2.26847
------------------- --------------------------------- ---------------------- ------------------------------------
DEFINITIONS
We, Our, Us. American International Life Assurance Company of New York.
Administrative Office. 80 Pine Street, New York, NY 10005.
Allocation Date. The first business day following the completion of the Right To
Examine This Policy period.
Attained Age. The Insured Person's age on the Policy Date plus the number of
full years since the Policy Date.
Beneficiary. The person(s) who is entitled to the Insurance Benefit of this
Policy.
Cash Surrender Value. Policy Account Value less any applicable surrender charge
that would be deducted upon surrender. See page 5.
Death Benefit. The amount of money payable to the Beneficiary if the Insured
Person dies while the Policy is in force. The Death Benefit is described on page
10.
Face Amount. The amount of insurance You have specified and from which the death
benefit will be determined. The initial Face Amount is shown in the Policy
Information section.
Grace Period. The period of time following a Monthly Anniversary during which
this Policy will continue in force while the Net Cash Surrender Value is not
sufficient to cover the total monthly deduction then due.
Guaranteed Account. An account within the general account which consists of all
of Our assets other than the assets of the Separate Account and any of Our other
separate accounts.
Insured Person. The person whose life is covered by the Policy.
Issue Date. The date the Policy is issued. It may be a later date than the
Policy Date if the initial Premium is received at Our Administrative Office and
invested before underwriting has been completed. Once issued, Policy coverage is
retroactive to the Policy Date. The Issue Date is used to measure contestability
periods. See page 20.
Maturity Date. The Policy Anniversary following the Insured Person's attained
age 99.
Monthly Anniversary. The same day as the Policy Date for each succeeding month,
except that, for those months not having such a day, it is the last day of that
month.
Net Cash Surrender Value. The Cash Surrender Value less any Outstanding Loan.
Net Premium. A Premium less any expense charges deducted from the Premium. See
page 4.
Outstanding Loan. The total amount of Policy loans including both principal and
accrued interest.
Owner, You, Your. The person who purchased this Policy as shown in the
application, unless later changed. The Owner may be someone other than the
Insured Person.
Planned Periodic Premium. The amount of Premium You have selected to pay at the
frequency shown in the Policy Information section.
Policy. This Flexible Premium Variable Life Insurance contract between American
International Life Assurance Company of New York and You.
Policy Account Value. The total amounts in the accounts credited to a Policy.
The Policy Account Value is described on page 15.
Policy Anniversary. An anniversary of the Policy Date.
Policy Date. The first date as of which We have received the initial Premium and
an application in good order. If a Policy is issued, insurance is effective as
of the Policy Date.
Policy Loan Account. The portion of the Policy Account Value held in the
Guaranteed Account as collateral for Policy loans.
Policy Month. The month commencing with the Policy Date and ending on the day
before the first Monthly Anniversary, or any following month commencing with a
Monthly Anniversary and ending on the day before the next Monthly Anniversary.
Policy Year. The year commencing with the Policy Date and ending on the day
before the first Policy Anniversary, or any following year commencing with a
Policy Anniversary and ending on the day before the next Policy Anniversary.
Premium. The total consideration paid by you in exchange for our obligations
under this Policy. The initial Premium is due on or before delivery of this
Policy.
Separate Account. Variable Account B, a separate investment account of American
International Life Assurance Company of New York.
Subaccount. A division of the Separate Account established to invest in a
particular fund and available for investment under the Policy.
Valuation Date. Each day the New York Stock Exchange is open for business.
Valuation Period. A period commencing with the close of business on the New York
Stock Exchange on any particular day and ending at the close of business on the
New York Stock Exchange for the next succeeding Valuation Date.
POLICYOWNER AND BENEFICIARY PROVISIONS
Owner. The Owner of this Policy is the Insured Person unless otherwise stated in
the application, or later changed.
As the Owner, You are entitled to exercise all the rights of this Policy while
the Insured Person is living. To exercise a right, You do not need the consent
of anyone who has only a conditional or future ownership interest in this
Policy.
Beneficiary. The Beneficiary is as stated in the application, unless later
changed. The Beneficiary is entitled to the Insurance Benefit of this Policy.
One or more beneficiaries for the Insurance Benefit can be named in the
application. If more than one Beneficiary is named, they can be classed as
primary or contingent. If two or more persons are named in a class, their shares
in the benefit can be stated. The stated shares in the Insurance Benefit will be
paid to any primary beneficiaries who survive the Insured Person. If no primary
beneficiaries survive, payment will be made to any surviving contingent
beneficiaries. Beneficiaries who survive in the same class will share the
Insurance Benefit equally, unless You have made another arrangement with us.
If there is no designated Beneficiary living at the death of the Insured Person,
We will pay the Insurance Benefit to the Owner, if living, otherwise to the
Owner's estate.
Changing The Owner Or Beneficiary. While the Insured Person is living, You may
change the Owner or Beneficiary by written notice in a form satisfactory to us.
(You can get such a form from Our agent or by writing to Us at Our
Administrative Office.) The change will take effect on the date You sign the
notice. But, it will not apply to any payment We make or other action We take
before We receive the notice. If You change the Beneficiary, any previous
arrangement You made as to a payment option for benefits is canceled. You may
choose a payment option for the new Beneficiary in accordance with "How Benefits
Are Paid" on page 20.
Assignment. You may assign this Policy, if We agree. In any event, We will not
be bound by an assignment unless We have received it in writing at Our
Administrative Office. Your rights and those of any other person referred to in
this Policy will be subject to the assignment. We assume no responsibility for
the validity of an assignment. An absolute assignment will be considered as a
change of ownership to the assignee.
THE BENEFITS WE PAY
Insurance Benefit. We will pay the Insurance Benefit of this Policy to the
Beneficiary when We receive at Our Administrative Office (1) proof satisfactory
to Us that the Insured Person died before the Maturity Date and while this
Policy was in force; and (2) all other requirements We deem necessary before
such payment may be made. The Insurance Benefit includes the following amounts,
which We will determine as of the date of the Insured Person's death:
o the Death Benefit described below;
o plus any other benefits then due from riders to this Policy; o minus any
Outstanding Loan and accrued loan interest;
o minus any overdue deductions from Your Policy Account Value if the
Insured Person dies during a grace Period.
We will add interest to the resulting amount for the period from the date of
death to the date of payment. We will compute the interest at a rate We
determine, but not less than the rate required by any applicable law. Payment of
the Insurance Benefit may also be affected by other provisions of this Policy.
See Page 20 and 21, where We specify Our right to contest the Policy, the
suicide exclusion, and what happens if age or sex has been misstated. Special
exclusions or limitations (if any) are listed in the Policy Information section.
Death Benefit. The Death Benefit will be determined under either Death Benefit
Option I or II below, whichever You have chosen and is in effect at such time.
Under either Death Benefit Option, the duration of insurance coverage depends
upon Your Net Cash Surrender Value.
Under Death Benefit Option I, the Death Benefit is the greater of the Face
Amount, or a percentage of the Policy Account Value on the date of death (see
Table Of Applicable Percentages, below). Under this Option, the amount of the
Death Benefit is fixed, unless it is determined by such a percentage.
Under Death Benefit Option II, the Death Benefit is the greater of the Face
Amount plus the Policy Account Value on the date of death, or a percentage of
the Policy Account Value on the date of death (see Table Of Applicable
Percentages, below). Under this Option, the amount of the Death Benefit is
variable.
The following table is used in determining the Death Benefit under Death Benefit
Options I and II above. For Attained Ages not shown, the applicable percentages
shall decrease by a ratable portion for each full year.
Table Of Applicable Percentages
Attained Age Percentage
40 Or Less 250%
45 215%
50 185%
55 150%
60 130%
70 115%
75 through 90 105%
95 through 99 100%
Maturity Benefit. If the Insured Person is living on the Maturity Date defined
in the Policy Information section, We will pay You Your Policy Account Value on
that date minus any Outstanding Loan and accrued loan interest and this Policy
will then end.
CHANGING THE FACE AMOUNT OR THE DEATH BENEFIT OPTION
At any time after the first Policy Year while this Policy is in force, You may
change the Death Benefit Option or the Face Amount by written request to Us at
Our Administrative Office, subject to Our approval and the following:
1. You may ask Us to increase the Face Amount if You provide evidence
satisfactory to Us of the insurability of the Insured Person. If the Face
Amount is increased, then the cost of insurance rate for the amount of the
increase will be based on the rating class of the Insured Person on the
date of the increase, and the Insured Person's sex and Attained Age. Any
increase You ask for must be at least $10,000. There is a charge for such
increase which is shown in the Policy Information section. We will deduct
the charge from Your Policy Account Value beginning with the date the
increase takes effect. Such deduction will be made in accordance with the
"Treatment Of Deductions" provision on Page 13. If You increase the Face
Amount, an additional fourteen year surrender charge may apply to that
increase if any or all of that increase is surrendered before the end of
the fourteenth year from the effective date of increase. We will not allow
You to increase the Face Amount more than once during any Policy Year, nor
will We allow You to increase the Face Amount after the Insured Person's
75th birthday.
2. You may ask Us to reduce the Face Amount but not to less than the minimum
Face Amount for which We would then issue this Policy under Our rules. Any
such reduction in the Face Amount may not be less than $5,000 or, during
the first five Policy Years, more than 10% of the original Face Amount. If
You do this before the end of the fourteenth year or before the end of the
fourteenth year following an increase in the Face Amount, We may deduct
from Your Policy Account Value a pro rata share of the applicable surrender
charge (see Page 17). Reductions will first be applied against the most
recent increase in the Face Amount. They will then be applied to prior
increases in the Face Amount in the reverse order in which such increases
took place, and then to the original Face Amount. We will not allow You to
reduce the Face Amount in the first year immediately following the
effective date of an increase in the Face Amount or more than once during
any Policy Year.
3. You can change Your Death Benefit Option. We may require that You submit
evidence, satisfactory to Us that the Insured Person is insurable. If You
ask Us to change from the Death Benefit Option I to Death Benefit Option
II, We will decrease the Face Amount by the amount in Your Policy Account
Value on the date the change takes effect. However, We reserve the right to
decline to make such change if it would reduce the Face Amount below the
minimum Face Amount for which We would then issue this Policy under Our
rules. If You ask Us to change from Death Benefit Option II to Death
Benefit Option I, We will increase the Face Amount by the amount in Your
Policy Account Value on the date the change takes effect. Such decreases
and increases in the Face Amount are made so that the Death Benefit remains
the same on the date the change takes effect. However, if Your Death
Benefit is determined by a percentage multiple of the Policy Account Value,
there may be an increase in the Death Benefit.
4. The change will take effect at the beginning of the Policy Month that
coincides with or next follows the date We approve Your request.
5. We reserve the right to decline to make any change that We determine would
cause this Policy to fail to qualify as life insurance as defined in
Section 7702 of the Internal Revenue Code, as amended (see Page 20).
6. You may ask for a change by completing an Application For Change, which You
can get from Our agent or by writing to Us at Our Administrative Office. A
copy of Your Application For Change will be attached to the new Policy
Information section that We will issue when the change is made. The new
section and the Application For Change will become a part of this Policy.
We will require You to return this Policy to Our Administrative Office to
make a Policy change.
THE PREMIUMS YOU PAY
The initial Premium shown in the Policy Information section is due on or before
delivery of this Policy. No insurance will take effect before the initial
Premium is paid. Other Premiums may be paid at any time while this Policy is in
force and before the Maturity Date at Our Administrative Office.
We will send Premium notices to You for the Planned Periodic Premium shown in
the Policy Information section. You may skip Planned Periodic Premiums. However,
this may adversely affect the duration of the Death Benefit and Your Policy's
values.
Limits. Each Premium after the initial one must be at least the minimum Premium
amount shown in the Policy Information section. We reserve the right to limit
the amount of any Premium which is in addition to the Planned Periodic Premiums.
We also reserve the right not to accept Premium (in a Policy Year) that We
determine would cause this Policy to fail to qualify as a life insurance
contract as defined in Section 7702 of the Internal Revenue Code, as amended
(see Page 20).
Grace Period. The duration of insurance coverage depends upon the Net Cash
Surrender Value being sufficient to cover the total monthly deductions described
on Page 13. If the Net Cash Surrender Value at the beginning of any Policy Month
is less than such deductions for that month, We will send a written notice
within 30 days to You and any assignee on Our records at last known addresses
stating that a Grace Period of 61 days has begun, starting with the beginning of
that Policy Month. The notice will also state the amount of premium which would
increase the Net Cash Surrender Value sufficiently to cover total monthly
deductions for 3 months if no Policy changes were made. If we do not receive the
requested premium amount before the end of the Grace Period, this Policy will
end without value.
If the Insured Person dies during a Grace Period, We will pay the Insurance
Benefit as described on Page 9.
Reinstatement Of Your Policy. If this Policy has ended without value, You may
reinstate the Policy while the Insured Person is alive if you:
1. Ask for reinstatement of the Policy within 3 years from the end of the
Grace Period; and
2. Provide evidence of insurability satisfactory to us; and
3. Pay a Premium sufficient to cover (i) the total monthly administrative
charges from the beginning of the Grace Period to the effective date of
reinstatement; (ii) total monthly deductions for 3 months, calculated from
the effective date of reinstatement; and (iii) the charge for applicable
taxes, the Premium charge, and any increase in surrender charges associated
with this payment. We will determine the required Premium as if no interest
or investment performance were credited to or charged against Your Policy
Account Value; and
4. Repay or reinstate any Policy loan which existed on the date the Policy
ended.
The effective date of the reinstatement of this Policy will be the beginning of
the Policy Month which coincides with or next follows the date We approve Your
request.
From the required Premium We will deduct the charge for applicable taxes and the
Premium charge. The Policy Account Value, Policy loan and surrender charges
applicable at the time of reinstatement will be those that were in effect on the
date this Policy lapsed.
We will start to make monthly deductions again as of the effective date of
reinstatement. The monthly administrative charges from the beginning of the
Grace Period to the effective date of reinstatement will be deducted from the
Policy Account Value as of the effective date of reinstatement.
YOUR POLICY ACCOUNT VALUE AND HOW IT WORKS
Premium. When We receive Your Premium, We subtract the expense charges shown in
the table in the Policy Information section. We put the balance (the Net
Premium) into Your Policy Account Value as of the date We receive the Premium at
Our Administrative Office, and before any deductions from Your Policy Account
Value as of the Policy Date if it is later than the date of receipt. No Premiums
will be applied to Your Policy Account Value until the full initial Premium, as
shown on Your application, is received at Our Administrative Office.
Monthly Deductions. At the beginning of each Policy Month We make a deduction
from Your Policy Account Value to cover monthly administrative charges and to
provide insurance coverage, subject to the Grace Period provision. Such
deduction for any Policy Month is the sum of the following amounts determined as
of the beginning of that month:
o the monthly administrative charges;
o the monthly cost of insurance for the Insured Person;
o the monthly cost of any benefits provided by riders to this Policy.
The monthly cost of insurance is the sum of a) Our current monthly cost of
insurance rate times the net amount at risk at the beginning of the Policy Month
divided by $1,000; plus b) any extra charge per $1,000 of Face Amount shown in
the Policy Information section, times the Face Amount at the beginning of the
Policy Month divided by $1,000. If the Death Benefit is the Face Amount, then
the net amount at risk is the Death Benefit divided by 1.0032737 minus the
amount in Your Policy Account Value at that time. However, if the Death Benefit
is a percentage of the Account Value of this Policy, then the net amount at risk
is the Death Benefit minus the amount in Your Policy Account Value at that time.
The cost of insurance rate is based on the Face Amount and on the sex, Attained
Age, rating class, and smoker or non-smoker status of the Insured Person.
We will determine cost of insurance rates from time to time. Any change in the
cost of insurance rates We use will be as described in "Changes In Policy Cost
Factors" on page 20. They will never be more than those shown in the Table Of
Guaranteed Maximum Cost Of Insurance Rates on page 6.
Other Deductions. We also make the following additional deductions from Your
Policy Account Value as they occur:
o We deduct a partial surrender charge if You make a partial surrender
of this Policy (see page 17).
o We deduct a surrender charge if, before the end of the fourteenth
Policy Year, You give up this Policy for its Net Cash Surrender Value,
You reduce the Face Amount, or if this Policy terminates without value
at the end of a Grace Period (see page 17). A surrender charge may
also apply to such transactions for up to fourteen years immediately
following a Face Amount increase.
o We deduct a charge if You increase the Face Amount (see page 11).
o We deduct a charge for certain transfers (see page 14).
Treatment Of Deductions. We will make all deductions based on the proportion
that Your unloaned value in Our Guaranteed Account and Your values in the
Subaccounts bear to the total unloaned value in Your Policy Account Value.
YOUR INVESTMENT OPTIONS
Allocations. This Policy provides investment options for the amount in Your
Policy Account Value. Amounts put into Your Policy Account Value are allocated
to the Subaccounts and to the unloaned portion of Our Guaranteed Account at Your
direction. You specified Your initial Premium allocation percentages in Your
application for this Policy, a copy of which is attached to this Policy. Unless
You change them, such percentages shall also apply to subsequent Premiums.
However, any Premium which is put into Your Policy Account Value prior to the
Allocation Date will initially be allocated to the Money Market Subaccount. On
the Allocation Date, any such amounts then in the Money Market Subaccount will
be allocated in accordance with the directions contained in Your Policy
application.
No less than 5% of a Premium may be allocated to any one account. Allocation
percentages must be zero or a whole number not greater than 100. The sum of the
Premium allocation percentages must equal 100. You may change such allocation
percentages by written notice to Our Administrative Office. A change will take
effect on the date We receive it at Our Administrative Office except for changes
received on or prior to the Allocation Date which will take effect on the first
business day following the Allocation Date.
Transfers. At Your written request to Our Administrative Office, We will
transfer amounts from Your value in any Subaccounts to one or more other
Subaccounts or to Our Guaranteed Account. Any such transfer will take effect on
the date We receive Your written request for it at Our Administrative Office.
Once during each Policy Year You may ask Us by written request to Our
Administrative Office to transfer an amount You specify from Your unloaned value
in Our Guaranteed Account to one or more Subaccounts. However, We will make such
a transfer only if (1) We receive Your written request at Our Administrative
Office within 30 days before or after a Policy Anniversary; and (2) the amount
You specify is not more than the greater of 25% of Your unloaned value in Our
Guaranteed Account as of the date the transfer takes effect or the minimum
transfer amount shown on page 3. In no event will We transfer more than Your
unloaned value in Our Guaranteed Account. The transfer will take effect on the
date We receive Your written request for it at Our Administrative Office but not
before the Policy Anniversary.
The minimum amount that We will transfer from the amount You have in a
Subaccount is the lesser of the minimum transfer amount shown on page 3 or the
amount You have in that Subaccount on that date, except as stated in the next
paragraph. The minimum amount that We will transfer from the amount You have in
Our Guaranteed Account is the lesser of the minimum transfer amount shown on
page 3 or Your unloaned value in Our Guaranteed Account as of the date the
transfer takes effect, except as stated in the next paragraph. If You do not
transfer the entire amount You have in a Subaccount or of the unloaned amount
You have in Our Guaranteed Account, the remaining value in either must be no
less than the minimum transfer amount shown on page 3.
We will waive the minimum amount limitations set forth in the immediately
preceding paragraph if the total amount being transferred on that date is at
least the minimum transfer amount shown on Page 3.
We reserve the right to make a transfer charge up to the amount shown on Page 4.
The transfer charge, if any, is deducted from the amounts transferred from the
Subaccounts and the Guaranteed Account based on the proportion that the amount
transferred from each Subaccount and the Guaranteed Account bears to the total
amount being transferred. A transfer from the Money Market Subaccount on the
Allocation Date (if applicable) will not incur a transfer charge.
YOUR POLICY ACCOUNT VALUE
The amount in Your Policy Account Value at any time is equal to the sum of the
amounts You then have in Our Guaranteed Account and the Subaccounts under this
Policy.
Your Value In The Subaccounts. The amount You have in a Subaccount under this
Policy at any time is equal to the number of units this Policy then has in that
Subaccount multiplied by the Subaccount's unit value at that time. A Policy
transaction occurs when units of a Subaccount are either purchased or redeemed.
Amounts allocated, transferred or added to a Subaccount are used to purchase
units of that Subaccount; units are redeemed when amounts are deducted, loaned,
transferred, or fully or partially surrendered.
The number of units a Policy has in a Subaccount at any time is equal to the
number of units purchased minus the number of units redeemed in that Subaccount
to that time. The number of units purchased or redeemed in a Policy transaction
is equal to the dollar amount of the Policy transaction divided by the
Subaccount's unit value on the date of the Policy transaction. Policy
transactions may be made on any day. The unit value that applies to a
transaction made on a business day will be the unit value for that day. The unit
value that applies to a transaction made on a non-business day will be the unit
value for the next business day.
We determine unit values for the Subaccounts at the end of each business day.
Generally, a business day is any day the New York Stock Exchange is open for
trading. A business day immediately preceded by one or more non-business
calendar days will include those non-business days as part of that business day.
For example, a business day which falls on a Monday will consist of that Monday
and the immediately preceding Saturday and Sunday.
The unit value of a Subaccount on any business day is equal to the unit value
for that Subaccount on the immediately preceding business day multiplied by the
net investment factor for that Subaccount on that business day.
The net investment factor for a Subaccount on any business day is (a) divided by
(b), minus (c), where:
(a) is the net asset value of the shares in designated investment companies that
belong to the Subaccount at the close of business on such business day before
any Policy transaction are made on that day, plus the amount of any dividend or
capital gain distribution paid by the investment companies on that day;
(b) is the value of the assets in that Subaccount at the close of business on
the immediately preceding business day after all transactions were made for that
day; and
(c) is a charge for each calendar day in that business day, as defined above,
corresponding to a charge not exceeding .90% yearly for mortality and expense
risks, plus any charge for that day for taxes or amounts set aside as a reserve
for taxes.
The net asset value of an investment company's shares held in each Subaccount
shall be the value reported to Us by that investment company.
Your Value In Our Guaranteed Account. The amount You have in Our Guaranteed
Account at any time is equal to the amounts allocated and transferred to it,
plus the interest credited to it, minus amounts deducted, transferred and
partially surrendered from it.
We will credit Our Guaranteed Account with interest rates We determine. An
interest rate equal to the loan interest rate will be applied to the loaned
portion in Our Guaranteed Account which is considered preferred Policy loan. An
interest rate of not less than the Policy loan rate minus 2% will be credited to
the loaned amount in Our Guaranteed Account which is considered non-preferred
Policy loan. Any change in the interest rate We credit to the unloaned amount in
Our Guaranteed Account will be as described in "Changes In Policy Cost Factors"
on Page 20. The interest rate applied to either the loaned or unloaned amount in
Our Guaranteed Account will not be less than 4% per year, compounded annually.
At the end of each Policy Month We will credit interest on unloaned amounts in
Our Guaranteed Account as follows:
o On amounts that remain in Our Guaranteed Account for the entire Policy
Month from the beginning to the end of the Policy Month.
o On amounts allocated to Our Guaranteed Account during a Policy Month
that are Net Premium payments or loan repayments, from the date We
receive them to the end of the Policy Month.
o On amounts transferred to Our Guaranteed Account during a Policy Month
from the date of the transfer to the end of the Policy Month.
o On amounts deducted or partially surrendered from Our Guaranteed
Account during a Policy Month, from the beginning of the Policy Month,
or the date such amount is allocated to the Guaranteed Account, if
later, to the date of the deduction or partial surrender.
THE CASH SURRENDER VALUE OF THIS POLICY
Cash Surrender Value. The Cash Surrender Value on any date is equal to the
amount in Your Policy Account Value on that date minus any surrender charge.
Net Cash Surrender Value. The Net Cash Surrender Value is equal to the Cash
Surrender Value minus any Policy loan and accrued loan interest. You may give up
this Policy for its Net Cash Surrender Value at any time while the Insured
Person is living. You may do this by sending Us a written request for it and
this Policy to Our Administrative Office. We will compute the Net Cash Surrender
Value as of the date We receive Your request for it and this Policy at Our
Administrative Office. All insurance coverage under this Policy ends on such
date.
Surrender Charges. If You give up this Policy for its Net Cash Surrender Value
or if it ends without value at the end of a Grace Period before the end of the
fourteenth Policy Year, We will subtract a surrender charge from Your Policy
Account Value. A table of maximum surrender charges is in the Policy Information
section.
An increase in the Face Amount will result in an additional fourteen year
surrender charge applicable to that increase. The additional surrender charge
period will begin on the effective date of the increase.
If the Face Amount is reduced before the end of the fourteenth Policy Year or
within fourteen years immediately following a Face Amount increase, because You
asked for a reduction in the Face Amount, We will also deduct a pro rata share
of any applicable surrender charge from Your Policy Account Value. Reductions
will first be applied against the most recent increase in the Face Amount. They
will then be applied to prior increases in the Face Amount in the reverse order
in which such increases took place, and then to the original Face Amount.
The amount of any pro rata surrender charge will be determined by the formula
A/B x C, where:
A = the amount of the reduction in the Face Amount.
B = the Face Amount immediately prior to the reduction.
C = the total surrender charge applicable to this policy immediately prior
to the reduction.
If there is an increase or reduction in the surrender charge shown on page 5, We
will send You a new table showing the revised surrender charges. We have filed a
detailed statement of the method of computing surrender charges with the
insurance supervisory official of the jurisdiction in which this Policy is
delivered.
Partial Surrender. A partial surrender will result in a reduction in the Cash
Surrender Value and in Your Policy Account Value equal to the partial surrender
amount as well as a reduction in Your Death Benefit. If Death Benefit Option I
is in effect, the partial surrender may also result in a decrease in the Face
Amount. However, We will not allow such partial surrender if it would reduce the
Face Amount to less than the minimum amount for which We would then issue this
Policy under Our rules. We will also not allow a partial surrender during the
first Policy Year or during the first 12 Policy Months immediately following an
increase in the Face Amount. After such periods and while the Insured Person is
living, You may ask for a partial surrender by written request to Our
Administrative Office no more than twice during a Policy Year. Your request will
be subject to Our approval based on Our rules in effect when We receive Your
request, and to the minimum partial surrender amount shown in the Policy
Information section. The partial surrender amount deducted from the Policy
Account Value is equal to the amount requested plus the expense charge shown in
the Table Of Expense Charges in the Policy Information section, as well as a
partial surrender charge. We have the right to decline a request for a partial
surrender.
You may tell Us how much of each partial surrender is to come from Your unloaned
value in Our Guaranteed Account and from Your values in each of the Subaccounts.
If You do not tell us, the partial surrender will be deducted from the Policy
Account Value based on the proportion that Your unloaned value in Our Guaranteed
Account and Your values in the Subaccounts bear to the total unloaned value in
Your Policy Account Value.
Such partial surrender and resulting reduction in the Death Benefit, in the Cash
Surrender Value and in Your Policy Account Value will take effect on the date We
receive Your written request for it at Our Administrative Office. We will send
You the applicable new page in the Policy Information section if a partial
surrender results in a reduction in the Face Amount. It will become a part of
this Policy. We may require You to return this Policy to Our Administrative
Office to make a change.
Partial Surrender Charge. The partial surrender charge is equal to the amount of
partial surrender plus the expense charge for a partial surrender divided by the
Net Cash Surrender Value immediately prior to the partial surrender and then
multiplied by the total surrender charge in effect at that time.
HOW A LOAN CAN BE MADE
Policy Loans. After the first Policy Year You can get a loan on this Policy
while it has a loan value. This Policy will be the only security for the loan.
The initial loan and each additional loan must be for at least the minimum loan
amount shown in the Policy Information section. Any amount on loan is part of
Your Policy Account Value (see page 16). We refer to this as the loaned portion
of Your Policy Account Value.
Loan Value. The loan value on any date is 90% of the Net Cash Surrender Value on
that date. The amount of the loan may not be more than the loan value. If You
request an increase to an existing loan, the amount requested will be added to
the amount of the existing loan and accrued loan interest.
Your request for a Policy loan must be in writing to Our Administrative Office.
You may tell Us how much of the requested loan is to be allocated to Your
unloaned value in Our Guaranteed Account and Your value in each Subaccount. Such
values will be determined as of the date We receive Your request. If You do not
tell Us We will allocate the loan based on the proportion that Your unloaned
value in Our Guaranteed Account and Your values in the Subaccounts bear to the
total unloaned value in Your Policy Account Value.
The loaned portion of Your Policy Account Value will be maintained as a part of
Our Guaranteed Account. Thus, when a loaned amount is allocated to an
Subaccount, We will redeem units of that Subaccount sufficient in value to cover
the amount of the loan so allocated and transfer that amount to Our Guaranteed
Account.
Preferred Loan Value. In Policy Year 11 and thereafter, the loaned portion of
Your Policy Account Value which is equal to or less than Your Policy Account
Value minus the sum of the Premiums paid into this Policy will be considered
preferred Policy loan. The remaining loaned portion of Your Policy Account Value
will be considered non-preferred Policy loan.
These amounts will be recalculated on each Monthly Anniversary.
Loan Interest. Interest on a loan accrues daily at the loan interest rate shown
in Policy Information section. Loan interest is due on each Policy Anniversary.
If the interest is not paid when due, it will be added to Your Outstanding Loan
and allocated based on the proportion that Your unloaned value in Our Guaranteed
Account and Your values in the Subaccounts bear to the total unloaned value in
Your Policy Account Value. The unpaid interest will then be treated as part of
the loaned amount and will bear interest at the loan rate.
When unpaid loan interest is allocated to a Subaccount, We will redeem units of
that Subaccount sufficient in value to cover the amount of the interest so
allocated and transfer that amount to Our Guaranteed Account.
Loan Repayment. You may repay all or part of a Policy loan at any time while the
Insured Person is alive and this Policy is in force. We will assume that any
payment You make to Us while You have a loan and Your Policy is not in the Grace
Period is a loan repayment, unless You tell Us in writing that it is a Premium
payment. A loan repayment will reduce the loaned portion of Your Policy Account
and will then be allocated on the basis of the Premium allocation percentages
then in effect.
Failure to repay a Policy loan or to pay loan interest will not terminate this
Policy unless at the beginning of a Policy Month the Net Cash Surrender Value is
less than the total monthly deduction then due. In that case, the Grace Period
provision will apply (see page 12).
A Policy loan will have a permanent effect on Your benefits under this Policy
even if it is repaid.
OUR SEPARATE ACCOUNT
The Separate Account is described on page 3. We established it and We maintain
it under the laws of the State of New York. Realized and unrealized gains and
losses from the assets of Our Separate Account are credited or charged against
it without regard to Our other income, gains, or losses. Assets are put in the
Separate Account to support this Policy and other variable life insurance
policies.
The assets of the Separate Account are Our property. The portion of its assets
equal to the reserves and other Policy liabilities with respect to the Separate
Account will not be chargeable with liabilities arising out of any other
business We conduct. We may transfer assets of the Separate Account in excess of
its reserves and other liabilities to another separate account or to Our general
account.
Subaccounts. Our Separate Account consists of Subaccounts. Each Subaccount
invests its assets in shares of a designated investment company or companies.
The Subaccounts that You chose for Your initial allocations are shown on the
application for this Policy, a copy of which is attached to this Policy. We may
from time to time make other Subaccounts available to you. We will provide You
with written notice of all material details including investment objectives and
all charges.
Subject to the prior approval of the insurance supervisory official of the
jurisdiction in which this Policy was delivered, We have the right to:
1. change, add or delete designated investment companies;
2. add or remove Subaccounts; and
3. combine any two or more Subaccounts.
Consistent with state law, We have the right to:
1. register or deregister the Separate Account under the Investment Company
Act of 1940;
2. run the Separate Account under the direction of a committee, and discharge
such committee at any time;
3. restrict or eliminate any voting rights of Policy Owners, or other persons
who have voting rights as to the Separate Account; and 4. operate the
Separate Account or one or more of the Subaccounts by making direct
investments or in any other form. If We do so, We may invest the assets of
the Separate Account or one or more of the Subaccounts in any legal
investments. We will rely upon Our own or outside counsel for advice in
this regard. Also, unless otherwise required by law or regulation, an
investment advisor or any investment Policy may not be changed without Our
consent. If required by law or regulation, the investment policy of a
Subaccount will not be changed by Us unless approved by the Superintendent
of Insurance of the State of New York or deemed approved in accordance with
such law or regulation. If so required, the process for getting such
approval is on file with the insurance supervisory official of the
jurisdiction in which this Policy is delivered.
If any of these changes result in a material change in the underlying
investments of a Subaccount, We will notify You of such change, as required by
law. If You have value in that Subaccount, We will transfer it at Your written
direction from that Subaccount (without charge) to another Subaccount or to Our
Guaranteed Account, and You may then change Your Premium allocation percentages.
OUR ANNUAL REPORT TO YOU
For each Policy Year We will send You a report for this Policy that shows the
current Death Benefit, the value You have in Our Guaranteed Account and the
value You have in each Subaccount of Our Separate Account, the Cash Surrender
Value and any Policy loan with the current loan interest rate. It will also show
the Premiums paid and any other information as may be required by the insurance
supervisory official of the jurisdiction in which this Policy is delivered.
HOW BENEFITS ARE PAID
The Insurance Benefit, surrender value or Your Policy Account Value payable on
the Maturity Date will be paid immediately in one sum.
OTHER IMPORTANT INFORMATION
Your Contract With Us. This Policy is issued in consideration of the payment of
the initial Premium shown in the Policy Information section.
This Policy, and the attached copy of the initial application, supplemental
application and all subsequent applications to change this Policy, and all
additional Policy Information sections added to this Policy, make up the entire
contract. The rights conferred by this Policy are in addition to those provided
by applicable Federal and State laws and regulations.
Only Our executive officers can modify this contract or waive any of Our rights
or requirements under it. The person making these changes must put them in
writing and sign them.
Policy Changes - Applicable Tax Law. For You and the Beneficiary to receive the
tax treatment accorded to life insurance under Federal law, this Policy must
qualify initially and continue to qualify as life insurance under the Internal
Revenue Code or and successor law or regulation. Therefore, to assure this
qualification for You, We have reserved earlier in this Policy the right to
decline to accept Premium, in whole or in part, to decline to change Death
Benefit Options, to decline to change the Face Amount or to decline to make
partial surrenders that would cause this Policy to fail to qualify as a life
insurance contract as defined in Section 7702 of the Internal Revenue Code, as
amended. Further, We reserve the right to make changes in this Policy or its
riders (for example, in the Table Of Applicable Percentages on page 10) or to
require additional Premium or to make distributions from this Policy to the
extent We deem it necessary to continue to qualify this Policy as life
insurance. Any such changes will apply uniformly to all policies that are
affected and will be subject to the prior approval of the insurance supervisory
official of the jurisdiction in which the policy is delivered. You will be given
advance notice of such changes.
Changes In Policy Cost Factors. Changes in Policy cost factors (interest rates
We credit, cost of insurance deductions and expense charges) will be by class
and based upon changes in future expectations for such elements as: investment
earnings, mortality, persistency, expenses and taxes. Any change in Policy cost
factors will be determined in accordance with procedures and standards on file,
if required, with the insurance supervisory official of the jurisdiction in
which this Policy is delivered.
When The Policy Is Incontestable. We have the right to contest the validity of
this Policy based on material misstatements made in the initial application for
this Policy. We also have the right to contest the validity of any Policy change
or restoration based on material misstatements made in any application for that
change. However, We will not contest the validity of this Policy after it has
been in effect during the lifetime of the Insured Person for two years from the
Issue Date shown in the Policy Information section. We will not contest any
Policy change that requires evidence of insurability, or any restoration of this
Policy, after the change or restoration has been in effect for two years during
the Insured Person's lifetime.
No statement shall be used to contest a claim unless contained in an
application.
All statements made in an application are representations and not warranties.
See any additional benefit riders for modifications of this provision that apply
to them.
What If Age Or Sex Has Been Misstated? If the Insured Person's age or sex has
been misstated on any application, the Death Benefit and any benefits provided
by riders to this Policy shall be those which would be purchased by the most
recent deduction for the cost of insurance, and the cost of any benefits
provided by riders, at the correct age and sex.
How The Suicide Exclusion Affects Benefits. If the Insured Person commits
suicide within two years after the Issue Date shown in the Policy Information
section, Our liability will be limited to the payment of a single sum. This sum
will be equal to the Premiums paid, minus any loan and accrued loan interest and
minus any partial surrender and minus the cost of any riders attached to this
Policy. If the Insured Person commits suicide within two years after the
effective date of a change that You asked for that increases the Death Benefit,
then Our liability as to the increase in amount will be limited to the payment
of a single sum equal to the monthly cost of insurance deductions made for such
increase plus the expense charge deducted for the increase (see page 11).
How We Measure Policy Periods And Anniversaries. We measure Policy Years, Policy
Months, and Policy Anniversaries from the Policy Date. Each Policy Month begins
on the same day as the Policy Date for each succeeding month, except that, for
those months not having such a day, it is the last day of that month.
How, When And What We May Defer. We may not be able to obtain the value of the
assets of the Subaccounts if: (1) the New York Stock Exchange is closed; or (2)
the Securities and Exchange Commission requires trading to be restricted or
declares an emergency. During such times, as to amounts allocated to the
Subaccounts, We may defer:
1. Determination and payment of partial surrenders;
2. Determination and payment of any Death Benefit in excess of the Face Amount;
3. Payments of loans;
4. Determination of the unit values of the Subaccounts; and
5. Any requested transfer or the transfer on the Allocation Date.
As to amounts allocated to Our Guaranteed Account, We may defer payment of any
surrender or loan amount for up to six months after We receive a request for it.
We will allow interest, at a rate of at least 4% a year, on any Net Cash
Surrender Value payment derived from Our Guaranteed Account that we defer for 10
days or more after We receive a request for it.
The Basis We Use For Computation. We provide Cash Surrender Values that are at
least equal to those required by law. If required to do so, We have filed with
the insurance supervisory official of the jurisdiction in which this Policy is
delivered a detailed statement of Our method of computing such values. We
compute reserves under this Policy by the Commissioners Reserve Valuation
Method.
We base minimum Cash Surrender Values and reserves on the Commissioners 1980
Standard Ordinary Male and Female, Smoker and Non-Smoker, Mortality Tables, Age
Last Birthday. We also use these tables as the basis for determining maximum
insurance costs, taking Account of sex, Attained Age, rating class and Smoker or
Non-Smoker status of the Insured Person. We use an effective annual interest
rate of 4%.
Policy Illustrations. Upon request We will give You an illustration of the
future benefits under this Policy based upon both guaranteed and current cost
factor assumptions. However, if You ask Us to do this more than once in any
Policy Year, We reserve the right to charge You a reasonable fee for this
service.
Policy Changes. You may add additional benefit riders or make other changes,
subject to Our rules at the time of change.
Your Exchange Right. You may exchange this Policy while it is in force for a new
flexible premium fixed benefit life insurance policy on the life of the Insured
Person, without evidence of insurability. This exchange may be made either:
1. within 24 months after the Issue Date while this Policy is in force;
or
2. within 24 months after any increase in the Face Amount of this Policy;
or
3. within 60 days of the effective date of a material change in the
investment policy of a Subaccount, or within 60 days of the
notification of such change, if later. In the event of such a change,
the Company will notify You and give You information on the options
available.
When an exchange is requested, We accomplish this by transferring all monies to
the Guaranteed Account. There is no charge for this transfer. Once this option
is exercised, Your entire Policy Account Value must remain in the Guaranteed
Account for the life of this Policy. The Face Amount in effect at the time of
the exchange will remain unchanged. The Policy Date, Issue Date and issue age of
the Insured Person will remain unchanged. The Owner and Beneficiary will remain
the same as were recorded immediately before the exchange.
Dollar Cost Averaging. Using Our Dollar Cost Averaging Plan Request Form, You
may elect automatic monthly transfers from the Money Market Subaccount into
Subaccounts for a specified dollar amount or specified number of months, not in
excess of 24, in accordance with the following:
1. the allocation to the Subaccounts will be based on the premium allocation
that is in effect at the time of each transfer;
2. if you elect Dollar Cost Averaging in conjunction with Your application for
this Policy, the automatic transfers will begin on the first Monthly
Anniversary following the end of the Free Look Period;
3. if you elect Dollar Cost Averaging after this Policy has been issued, the
automatic transfers will begin on the second Monthly Anniversary following
Our receipt of Your election;
4. this option may be elected at any time provided there is a minimum balance
of $2,000 in the Money Market Subaccount;
5. all premiums received after the date you elect Dollar Cost Averaging will
be applied to the Money Market Subaccount for the purpose of Dollar Cost
Averaging.
If you elect to transfer a specific dollar amount each month, automatic
transfers will continue until Your Money Market Subaccount is depleted. If you
elect to transfer based on a specific number of months, each month We will
transfer a fraction of the balance in the Money Market Fund equal to one divided
by the number of months remaining in the period. For example, if You elect to
transfer over a 12 month period, the first transfer will be1/12th of the balance
in the Money Market Fund, the second transfer will be 1/11th of the balance, the
third transfer will be 1/10th of the balance and so on until the end of the
requested period.
Automatic monthly transfers will continue until one of the following conditions
occur:
1. the balance in the Money Market subaccount is depleted;
2. We receive Your written request to cancel future transfers;
3. We receive notification of the death of the Insured Person;
4. this Policy lapses.
| EX-99.C.(1) | Last Page of 23 | TOC | 1st | Previous | Next | ↓Bottom | Just 23rd |
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AMERICAN INTERNATIONAL LIFE ASSURANCE COMPANY OF NEW YORK
80 PINE STREET
NEW YORK, NEW YORK 10005
Flexible Premium Variable Life Insurance Policy. Insurance payable upon death
before the Maturity Date while this Policy is in force. Policy Account Value
payable on Maturity Date. Adjustable Death Benefit. Premiums may be paid while
Insured Person is living and before the Maturity Date. Net Cash Surrender Value
must be sufficient to keep the Policy in force. Values provided by this Policy
are based on declared interest rates, and on the investment performance of the
Subaccounts. Policy values are not guaranteed as to dollar amount. Investment
options are described on page 14. This is a non-participating Policy.
Dates Referenced Herein
| Referenced-On Page |
|---|
| This ‘485BPOS’ Filing | | Date | | First | | Last | | | Other Filings |
|---|
| |  |
| Filed on / Effective on: | | 10/27/98 | | | | | | | None on these Dates |
| | 1/1/95 | | 4 |
| List all Filings |
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