Document/Exhibit Description Pages Size
1: 485BPOS Post-Effective Amendment to Registration Statement 324 1.85M
13: EX-99.2.C Opinion and Consent of Donald F. Gruber, Esq. 2 11K
14: EX-99.2.D Consent of Kpmg LLP 1 8K
15: EX-99.2.E Opinion and Consent of Mr. Brian C. Anderson 2 11K
16: EX-99.2.F Opinion of Jones & Blouch L.L.P. 1 9K
17: EX-99.2.H Power of Attorney 2 14K
11: EX-99.A.10(V) Variable Universal Life Employee Application 4± 23K
12: EX-99.A.10(VI) Variable Universal Life Spouse Application 4± 22K
2: EX-99.A.5(A) Group Variable Universal Life Policy 24 92K
3: EX-99.A.5(B) Group Variable Universal Life Policy Certificate 23 86K
4: EX-99.A.5(C) Group Variable Universal Life Policy Certificate 24 88K
9: EX-99.A.5(CC) Variable Universal Life Guaranteed Account 2 16K
Amdmt
10: EX-99.A.5(DD) Variable Universal Life Partial Surrender Amdmt 1 10K
5: EX-99.A.5(E) Spouse Coverage 24 87K
6: EX-99.A.5(F) Spouse Coverage 25 88K
7: EX-99.A.5(O) Individual Variable Universal Life Policy 24 86K
8: EX-99.A.5(P) Individual Variable Universal Life Policy 26 86K
EX-99.A.5(O) — Individual Variable Universal Life Policy
Exhibit Table of Contents
EX99.A5O
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MINNESOTA LIFE INDIVIDUAL POLICY
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Minnesota Life Insurance Company o 400 Robert Street North o
St. Paul, Minnesota 55101-2098
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READ YOUR POLICY CAREFULLY
--------------------------
This is a legal contract between you and us. We promise to pay the benefits
provided by this policy, subject to the provisions of this policy. We make this
promise and issue this policy in consideration of: (1) the application for this
policy; and (2) the payment of the required premiums.
Minnesota Life Insurance Company is a subsidiary of Minnesota Mutual Companies,
Inc., a mutual insurance holding company. The owner is a member of Minnesota
Mutual Companies, Inc., which holds its annual meetings on the first Tuesday in
March of each year at 3 p.m. local time. The meetings are held at 400 Robert
Street North, St. Paul, Minnesota 55101-2098.
RIGHT TO CANCEL
---------------
It is important to us that you are is satisfied with this policy after it is
issued. If you are not satisfied with it, you may return the policy to us or our
agent within 10 days after you receive it. You may also cancel this policy by
delivering or mailing a written notice or sending a telegram to Minnesota Life
Insurance Company (Minnesota Life), 400 Robert Street North, St. Paul, Minnesota
55101-2098 and returning the policy before midnight of the 10th day after you
received this policy. Notice given by mail and return of the policy by mail are
effective on being postmarked, properly addressed and postage prepaid. If you
return this policy, you will receive, within 7 days of the date we receive a
notice of cancellation, a full refund of any premiums you have paid. Upon
cancellation of this policy, it will be void from the beginning as if it never
had been issued.
Signed for Minnesota Life Insurance Company at St. Paul, Minnesota on the policy
date.
/s/ Dennis E. Prohofsky /s/ Robert L. Senkler
Secretary President
THE INITIAL DEATH BENEFIT WILL EQUAL THE FACE AMOUNT SHOWN IN THIS POLICY.
THE ACCOUNT VALUES UNDER THIS POLICY WILL VARY FROM DAY TO DAY. IT MAY INCREASE
OR DECREASE DEPENDING UPON SEPARATE ACCOUNT INVESTMENT EXPERIENCE. THERE IS NO
GUARANTEED MINIMUM ACCOUNT VALUE.
[Download Table]
TABLE OF CONTENTS
Definitions.....................2 Separate Account......................10
General Information.............4 Account Values........................13
Death Benefit...................5 Policy Loans..........................14
Payment of Proceeds.............6 Termination...........................16
Premiums........................8 Additional Information................17
Policy Charges..................8
VARIABLE UNIVERSAL LIFE INSURANCE . LEVEL DEATH BENEFIT . NONPARTICIPATING
MHC-94-18665 Rev. 5-2001 Minnesota Life 1
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MINNESOTA LIFE SPECIFICATIONS
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Minnesota Life Insurance Company o 400 Robert Street North o
St. Paul, Minnesota 55101-2098
-------------------------------------------------------------------------------
POLICY ID: 12345
-----
POLICYHOLDER: ABC COMPANY
SPONSOR: ABC COMPANY
INSURED: JOHN C. DOE
OWNER: JOHN C. DOE
JOHN DOE
456 MAIN STREET
ANYTOWN, USA 00000
INSURANCE INFORMATION
---------------------
Face Amount: $ 50,000 Effective Date: 05-01-2000
---------- ----------
INCREASING DEATH BENEFIT Anniversary Date: 05-01-2001
------------------------ ----------
Minimum Face Amount Available: $ 50,000
----------
Maximum Face Amount Available: $1,000,000
----------
Policyholder Planned Premium: $ 32.65 Weekly
--------
Sponsor Planned Premium: $ 20.00 Weekly
------------------------ --------
NON-SMOKER STATUS
Age at Issue: 35
--------
Identification Number: 111-22-3333
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CHARGES AGAINST PREMIUM FIXED MONTHLY CHARGES
----------------------- ---------------------
Sales Charge: 4.00% Administration Charge: $ 3.00
----- ---------------------- ------
Federal Tax Charge: 0.25%
-----
Premium Tax Charge: 2.00%
-----
SEPARATE ACCOUNT CHARGE
-----------------------
Mortality and Expense Risk
Charge: 0.5%
-----
IF A PARTIAL SURRENDER IS MADE, WE WILL ASSESS A CHARGE OF $25 OR TWO PERCENT OF
THE AMOUNT WITHDRAWN, WHICHEVER IS LESS.
ELECTED RIDERS ADDITIONAL AGREEMENTS
-------------- ---------------------
Spouse/Child Rider *Waiver of Premium
Accidental Death & Dismemberment Rider *Accelerated Death Benefit
These agreements are
included in the planned
monthly premium.
*See attached certificate
supplements for full details
PLEASE SEE THE REVERSE SIDE OF THIS SPECIFICATIONS PAGE FOR [ACCOUNT AND]
SUB-ACCOUNT OPTIONS AND ELECTIONS.
ACCOUNT OPTIONS AND ELECTIONS
-----------------------------
Guaranteed Account 20%
SUB-ACCOUNT OPTIONS AND ELECTIONS
---------------------------------
Policyholder Elections:
-----------------------
Advantus Series Fund Advantus Series Fund Index
Growth Portfolio 40% 400 Mid-Cap Portfolio 40%
-------------------------------- ----------------------------------
Sponsor Elections:
------------------
Advantus Series Fund Asset Allocation Portfolio 100%
-----------------------------------------------------
IRC SECTION 7702 TEST APPLIED IS:
---------------------------------
Cash Value Accumulation Test
----------------------------
[MINNESOTA LIFE INSURANCE COMPANY IS A SUBSIDIARY OF MINNESOTA MUTUAL COMPANIES,
INC., A MUTUAL INSURANCE HOLDING COMPANY. YOU ARE A MEMBER OF MINNESOTA MUTUAL
COMPANIES, INC., WHICH HOLDS ITS ANNUAL MEETINGS ON THE FIRST TUESDAY IN MARCH
OF EACH YEAR AT 3 P.M. LOCAL TIME. THE MEETINGS ARE HELD AT 400 ROBERT STREET
NORTH, ST. PAUL, MINNESOTA 55101-2098.]
Definitions
-----------
When we use the following words, this is what we mean:
account value
The sum of the values under the separate account, the guaranteed account and the
loan account of this policy. They are identified as the separate account value,
the guaranteed account value, and the loan account value, respectively.
actively at work
To be actively at work for the purposes of this policy, you must be currently
working at your employer's normal place of business at least _____ hours a week.
A person is not considered actively at work if not at work due to illness or
injury.
age
The insured's age at last birthday.
eligible insured
A person is eligible for insurance under this policy if the person:
1. is under age _____; and
2. was actively at work for each of the weeks immediately prior to the date
your application for coverage under this policy is approved by us, or are
legally married to an eligible insured; and
3. is identified by the plan sponsor as a person who is eligible to be insured
under the plan sponsor's employee benefit plan.
face amount
The minimum death benefit under this policy so long as the insurance coverage
under this policy remains in force.
fund
The mutual fund or separate investment portfolio within a series mutual fund
which we designate as an eligible investment for the separate account and it
sub-accounts.
general account
All assets of Minnesota Life other than those in the separate account or in
other separate accounts established by us.
guaranteed account value
MHC-94-18665 Rev. 5-2001 Minnesota Life 2
Assets other than the loan account value that are held in our general account
and attributable to this policy, and others of its class.
insured
An eligible insured who becomes insured under this policy.
lapse
A lapse of this policy means the insurance coverage under this policy has
terminated due to non-payment of a premium during its grace period in an amount
that, after the deduction of percentage-of-premium charges, is sufficient to
cover the monthly deductions due at the time we provide notice of lapse.
loan account
The portion of the general account which is attributable to loans under this
policy. A loan account value is the sum of all outstanding loans and accrued
loan interest credited under this policy.
maturity date
The 95th birthday of the insured.
monthly anniversary
The same date in each succeeding month as the policy date.
net cash value
The account value under this policy, less any outstanding policy loans and
accrued policy loan interest charged and any charges over due. It is the amount
you may obtain through surrender of this policy.
net premium
The premium less charges assessed against the premium. The net premium is the
amount or amounts which are allocated to the guaranteed account and/or the
separate account on your behalf.
plan sponsor
The employer, association, or organization which makes this insurance available
to its eligible insureds.
policy anniversary
The same day in each succeeding year as the policy date.
policy date
MHC-94-18665 Rev. 5-2001 Minnesota Life 3
The date coverage under this policy may become effective. The policy date is
shown on the specifications page attached to this policy.
separate account
The separate investment account created by us to receive and invest net premiums
received for this policy. The particular Separate Account for this policy is the
Variable Universal Life Account. We established this separate account for this
class of policies under Minnesota Law. The separate account is composed of
several sub-accounts. We own the assets of the separate account. However, those
assets not in excess of separate account liabilities are not subject to claims
arising out of any other business in which we engage.
sub-account
One or more sub-accounts, constituting the separate account.
sub-account value
The current number of sub-account units credited to your policy multiplied by
the current sub-account unit value.
unit
A measure of your interest in a sub-account of the separate account.
valuation date
Any date on which a fund is valued.
valuation period
The period between successive valuation dates measured from the time of one
determination to the next.
we, our, us
Minnesota Life Insurance Company.
you, your, policyowner
The owner of the policy, as shown in the application, unless subsequently
changed as provided for in this policy. The owner may be someone other than the
insured.
General Information
-------------------
What is your agreement with us?
This policy, your application and any supplemental application(s) contain the
entire contract between you and us. Any statements made in your application or
any supplemental application(s) will, in the absence of fraud, be considered
representations and not warranties. Also, any
MHC-94-18665 Rev. 5-2001 Minnesota Life 4
statement you or an insured made will not be used to void this policy nor defend
against a claim under this policy unless the statement is contained in the
application or any supplemental application(s).
No change or waiver of any of the provisions of this policy will be valid unless
made in writing by us and signed by our president, a vice president, our
secretary or assistant secretary. No agent or other person has the authority to
change or waive any provision of this policy.
Any additional benefit rider attached to this policy will become a part of this
policy and will be subject to all the terms and conditions of this policy unless
we state otherwise in the rider.
Can this policy be amended?
Yes. This policy may be amended at any time you and we agree to amend it. Any
amendment will be without prejudice to any claim in connection with a loss
sustained prior to the effective date of the amendment.
How do you exercise your rights under the policy?
You can exercise all the rights under this policy during an insured's lifetime
by making a written request to us. This includes the right to change the
ownership. If your policy is assigned, we will also require the written consent
of the assignee. If you have designated an irrevocable beneficiary, the written
consent of that beneficiary will also be required.
What is the effective date of this insurance?
Upon receipt of your application for insurance, the effective date of this
insurance will be the later of:
1. the date on which we approve your application; and
2. the date on which the first premium contribution is paid.
This effective date is shown on the specifications page attached to this policy.
Death Benefit
-------------
What is the amount of the death benefit?
The amount of the death benefit will be determined as follows:
1. The face amount of insurance on the insured's date of death while this policy
is in force; plus
2. the amount of the cost of insurance for the portion of the policy month from
the date of death to the end of the policy month; less
3. any outstanding policy loans and accrued policy loan interest charged; less
4. any unpaid monthly deductions determined as of the date of the insured's
death.
Payment of the death benefit will extinguish our liability under this policy.
MHC-94-18665 Rev. 5-2001 Minnesota Life 5
We intend that this policy qualify as a life insurance policy as defined by
Section 7702 of the Internal Revenue Code, as amended. We reserve the right to
either increase the face amount of insurance on the life of the insured, return
any excess net cash value or limit the amount of premium contributions we will
accept under this policy in order to maintain such qualification.
What is the face amount of insurance on the life of the insured?
The face amount of insurance on the life of the insured is as shown on the
specifications page attached to this policy.
May the face amount of insurance change?
Yes. The owner may apply for a change through a written request in compliance
within the limitations on the specifications page attached to this policy. If an
increase in the current face amount is applied for, we reserve the right to
require evidence of insurability from the insured.
If a decrease in the current face amount is requested, we will grant the
request. However, the amount of insurance on the insured may not be reduced to
less than the amount shown on the specifications page attached to this policy.
If, following a decrease in face amount, this policy would not comply with the
maximum premium limitations required by federal law, the decrease may be limited
or net cash value may be returned to the owner (at the owner's election), to the
extent necessary to meet these requirements.
When will changes in the face amount of insurance become effective?
Decreases in the face amount of insurance are effective on the monthly
anniversary on or following receipt of the written request by us. However, if
the owner requests that the decrease become effective on a specified future date
we will make the decrease effective on the policy monthly anniversary on or next
following the date requested.
Increases are effective on the monthly policy anniversary on or following the
date we approve the change, or any other date mutually agreed upon between you
and us.
When will the death benefit be paid?
We will pay interest on the face amount of insurance from the date of the
insured's death until the date of payment. We will pay interest on any charges
taken under this policy since the date of death from the date the charge was
taken until the date of payment.
Interest will be at an annual rate determined by us, but never less than the
greater of three percent per year compounded annually or the rate required by
law.
Death benefit proceeds will ordinarily be paid within seven days after we
receive all information required for such payment, including due proof of the
insured's death.
Payment of Proceeds
-------------------
To whom will we pay the death benefit?
MHC-94-18665 Rev. 5-2001 Minnesota Life 6
We will pay the death benefit proceeds to the surviving beneficiary specified on
the application or as subsequently changed.
What happens if one or all of the beneficiaries die before the insured?
If a beneficiary dies before the insured, that beneficiary's interest in this
policy ends with that beneficiary's death. Only those beneficiaries who survive
the insured will be eligible to share in the proceeds. If no beneficiary
survives the insured or if a beneficiary is not named, we will pay the proceeds
according to the following order of priority:
1. the insured's lawful spouse, if living; otherwise,
2. the personal representative of the insured's estate.
May the owner change the beneficiary?
If the owner has reserved the right to change the beneficiary, the owner may
file a written request with us to change the beneficiary. If the owner has not
reserved the right to change the beneficiary, the written consent of the
irrevocable beneficiary will be required. Your written request will not be
effective until it is recorded in our home office records. After it has been so
recorded, it will take effect as of the date the owner signed the request.
However, if the insured dies before the request has been so recorded, the
request will not be effective as to those proceeds we have paid before the
owner's request was so recorded.
Can death benefit proceeds be paid in other than a single sum?
Yes. An owner may request that we pay the death benefit proceeds under one of
the following settlement options. We may also use any other method of payment
that is agreeable to the owner and us. A settlement option may be selected only
if the payments are to be made to a natural person in that person's own right.
What are the settlement options available?
Each settlement option is paid in fixed amounts as described below. If the owner
of this policy requests a settlement option, he or she will be asked to sign an
agreement covering the election which will state the terms and conditions of the
payments. The payments do not vary with the performance of the separate account.
1. Interest Payments: Payment of interest on the proceeds at such times and
for a period as may be agreed upon between the owner of this policy and us.
Withdrawal of proceeds may be made in amounts of at least $500. At the end
of the period, any remaining proceeds will be paid in either a single sum or
under any other method we approve.
2. Fixed Period Annuity: An annuity payable in monthly installments for a
specified number of years, from one to twenty years.
MHC-94-18665 Rev. 5-2001 Minnesota Life 7
3. Life Annuity: An annuity payable monthly for the lifetime of the annuitant
and ending with the last monthly payment due prior to the annuitant's death.
4. Payments of a Specified Amount: Monthly payments of a specified amount until
the proceeds and interest are fully paid.
Can a beneficiary request a payment under a settlement option?
Yes. A beneficiary may select a settlement option, but only after the insured's
death. However, an owner may provide that the beneficiary will not be permitted
to change the elected settlement option.
Premiums
--------
When and how often are premiums due?
A premium must be paid to put this policy in force. This initial premium must be
of an amount that, after the deduction of percentage-of-premium charges, will
cover the first month's deductions plus $20. A premium must also be paid at such
time when there is insufficient net cash value to pay the monthly deductions
necessary to keep this policy in force. Premiums paid after the initial premium
may be in any amount of $20 or greater.
Is there a grace period for the payment of premiums?
Yes. This policy has a 61-day grace period. The grace period will start on the
day we mail the owner a notice of lapse. This policy will lapse if the premium
amount specified in the notice is not paid by the end of the grace period and
the net cash value is insufficient to cover the monthly deductions. We will mail
this notice on any policy monthly anniversary date when the net cash value for
the insured under this policy is insufficient to cover the monthly deductions.
This policy of insurance will remain in effect during the 61-day grace period.
If sufficient premium is not paid by the end of the grace period, the insured's
coverage will lapse. The grace period does not apply to the first premium
payment.
What is the amount of the death benefit during the grace period?
The death benefit amount provided under this policy will be paid if death occurs
during the grace period.
Policy Charges
--------------
What type of charges are there under this policy?
Charges under this policy are those which we assess against the premiums and the
account value under this policy and the separate account assets attributable to
this policy.
What charges are assessed against premiums?
Against premiums paid, we will assess: (1) a sales load, (2) a federal tax
charge, and (3) a state premium tax charge as percentage-of-premium charges.
MHC-94-18665 Rev. 5-2001 Minnesota Life 8
1. The sales load is for distribution expenses for this class of policies. This
sales load charge shall not exceed five percent of each premium paid.
2. The federal tax charge is to compensate us for the corporate federal income
taxes that result from a sale of this policy. The federal tax charge is 1.25
percent of each premium paid if this policy is deemed to be an individual
contract under the Omnibus Budget Reconciliation Act of 1990, as amended,
and 0.25 percent if deemed a group contract under that Act.
3. The state premium tax charge is the average premium tax we pay to state and
local governments for this class of policies. This charge is currently 2
percent. The charge is not guaranteed and may be increased in the future,
but only as necessary to cover our premium taxes.
WHAT CHARGES ARE ASSESSED AGAINST THE NET CASH VALUE OF THIS POLICY?
Against the net cash value of this policy, we assess as monthly deductions: (1)
the administration charge; (2) the cost of insurance charge; and (3) the charge
for any additional benefits provided by rider. We also will assess against the
net cash value a transaction charge at the end of the day on which the
transaction occurs.
1. The administration charge is for administrative expenses, including those
attributable to the records we create and maintain for this policy. The
maximum administration charge is $4 per month. This charge will be assessed
on the policy date and on each succeeding monthly policy anniversary.
2. The cost of insurance charge is for providing the death benefit under this
policy. The charge is calculated by multiplying the net amount at risk under
this policy by a rate which varies with the insured's age and rate class.
The rate is guaranteed not to exceed rates determined on the basis of 125
percent of the 1980 Commissioners Standard Ordinary Mortality Table. The net
amount at risk for this policy is the difference between the death benefit
and the account value. This charge will be assessed on the policy date and
on each succeeding monthly anniversary.
The policy charges described as Table A attached herein are maximum cost of
insurance charges.
3. The charge for any additional benefits provided by rider, if any, are
deducted as part of the monthly cost of insurance deduction.
4. A transaction charge will be assessed for each partial withdrawal to cover
the administrative costs incurred in processing the partial withdrawal. The
amount of the charge is the lesser of $25 or two percent of the amount
withdrawn. We may also assess a charge for any transfer of funds between
sub-accounts. The amount charged will not exceed $10. Any transaction charge
will be assessed at the end of the day on which the transaction occurs.
Charges will be assessed against the net cash value of this policy. They will be
assessed against the guaranteed account value and the separate account value in
the same proportion that those values bear to each other and, as to the separate
account value, from each sub-account in the proportion that the sub- account
value in each such sub-account bears to the separate account value.
WHAT CHARGES ARE ASSESSED AGAINST SEPARATE ACCOUNT ASSETS?
We assess a mortality and expense risk charge against the separate account
assets of this policy. We also reserve the right to charge or make provision for
income taxes payable by us based on separate account assets.
MHC-94-18665 Rev. 5-2001 Minnesota Life 9
WHAT IS THE MORTALITY AND EXPENSE RISK CHARGE?
This charge is for assuming the risks that the cost of insurance charge will be
insufficient to cover actual mortality experience and that the other charges
will not cover our expenses in connection with this class of policies. The
mortality and expense risk charge is deducted from the separate account assets
daily at an annual rate not to exceed 0.50 percent of the separate account
assets.
SEPARATE ACCOUNT
----------------
HOW WAS THE SEPARATE ACCOUNT ESTABLISHED?
We established the separate account in accordance with certain provisions of the
Minnesota insurance law.
WHAT IS THE PURPOSE OF THE SEPARATE ACCOUNT?
The purpose of the separate account is to hold assets attributable to the
variable portion of this policy and others of its class.
WHAT SEPARATE ACCOUNT OPTIONS ARE AVAILABLE?
The separate account is divided into sub-accounts. Those available to this
policy are listed on the specifications page attached to this policy. Net
premiums will be allocated to the various sub-accounts of the separate account
or any other sub-account which we may add in the future, as elected by the owner
of this policy. We reserve the right to add, combine or remove any sub-accounts
of the separate account.
WHAT ARE THE INVESTMENTS OF THE SEPARATE ACCOUNT?
For each sub-account, there is a fund for the investment of that sub account's
assets. The assets of the sub-accounts are invested in the funds at net asset
value. If investment in a fund should no longer be possible or if we determine
it becomes inappropriate for the policies of this class, we may substitute
another fund. Substitution may be with respect to both existing policy values
and future premiums. The investment policy of the separate account may not be
changed, however, without the approval of the regulatory authorities of the
State of Minnesota. If required, that approval process will be on file with the
regulatory authorities of the state in which this policy is delivered.
WHAT CHANGES MAY WE MAKE TO THE SEPARATE ACCOUNT?
We reserve the right to transfer assets of the separate account which we
determine to be associated with the class of policies to which this policy
belongs, to another separate account. If such a transfer is made, the term
"separate account" as used in this policy, shall then mean the separate account
to which the assets are transferred. A transfer of this kind may require the
advance approval of state regulatory authorities.
We reserve the right to, when permitted by law:
MHC-94-18665 Rev. 5-2001 Minnesota Life 10
1. restrict or eliminate any voting right of owners or other persons who have
voting rights as to the separate account; and
2. combine the separate account with one or more other separate accounts; and
3. to de-register the separate account under the Investment Company Act of
1940.
HOW ARE NET PREMIUMS ALLOCATED?
They are allocated either to the guaranteed account and/or to the separate
account and its sub-accounts. Initially, the allocation elected is indicated in
the application for this policy. Allocations may be changed for future premiums.
The owner may do this by giving us a written request. A change will not take
effect until it is recorded by us in our home office.
Allocations must be expressed in whole percentages. The allocation to any
alternative must be at least 10 percent of the net premium. We reserve the right
to restrict the allocation of premium. If we do so, no more than 50 percent of
the net premium may be allocated to the guaranteed account.
We reserve the right to delay the allocation of net premiums to named sub
accounts. Such a delay will be for a period of 30 days after issuance of this
policy. This right will be exercised by us only when we believe economic
conditions make such a delay necessary to reduce market risk during this period.
If we exercise this right, net premiums will be allocated to the money market
sub-account until the end of that period.
WHAT IS A TRANSFER?
A transfer is a reallocation of the net cash value between the guaranteed
account and the separate account or among the sub-accounts of the separate
account.
MAY THE OWNER MAKE TRANSFERS OF AMOUNTS UNDER THIS POLICY?
Yes. Transfers from a sub-account of the separate account may be made in writing
or by telephone. For transfers out of the separate account or among the
sub-accounts of the separate account, we will credit and cancel units based on
the sub-account unit values as of the end of the valuation period during which
the owner's written or telephone request is received at our home office. For
transfers out of the guaranteed account, a dollar amount will be transferred
based on the owner's guaranteed account value at the time of transfer.
ARE THERE LIMITATIONS ON TRANSFERS?
Yes. Only one transfer may be made under this policy each month. The amount to
be transferred to or from a sub-account of the separate account or the
guaranteed account must be at least $250. If the balance in the guaranteed
account or in the sub-account from which the transfer is to be made is less than
$250, the entire account value attributable to that sub-account or the
guaranteed account must be transferred. If a transfer would reduce the account
value in the sub-account from which the transfer is to be made to less than
$250, we reserve the right to include that remaining amount in the sub-account
with the amount transferred.
The maximum amount of net cash value to be transferred out of the guaranteed
account to the sub-accounts of the separate account may be limited to 20 percent
(or $250 if greater) of the guaranteed
MHC-94-18665 Rev. 5-2001 Minnesota Life 11
account value. Transfers to or from the guaranteed account may be limited to one
such transfer per policy year. We may further restrict transfers by requiring
that the request is received by us or postmarked in the 30-day period before or
after the last day of the policy anniversary. Requests for transfers which meet
these conditions would be effective after we approve and record them at our home
office.
HOW ARE UNITS DETERMINED?
The number of units credited with respect to each net premium payment is
determined by dividing the portion of the net premium payment allocated to each
sub-account by the then current unit value for that sub-account. This
determination is made as of the end of the valuation period during which the
premium is received at our home office. Once determined, the number of units
will not be affected by changes in the unit value.
HOW ARE UNITS INCREASED OR DECREASED?
The number of units of each sub-account credited to this policy will be
increased by the allocation of subsequent net premiums, policy experience
credits, loan repayments, interest credits and transfers to that sub-account.
The number of units credited to a sub-account of this policy will be decreased
by deductions to the sub-account, policy loans and loan interest charged,
transfers from that sub-account and partial surrenders from that sub-account.
The number of sub-account units will decrease to zero on this policy's
termination.
HOW IS A UNIT VALUED?
The unit value will increase or decrease on each valuation date. The amount of
any increase or decrease will depend on the net investment experience of the
sub-accounts of the separate account. The value of a unit for each sub-account
was originally set at $1.00 on the first valuation date. For any subsequent
valuation date, its value is equal to its value on the preceding valuation date
multiplied by the net investment factor for that sub-account for the valuation
period ending on the subsequent valuation date.
WHAT IS THE NET INVESTMENT FACTOR FOR EACH SUB-ACCOUNT?
The net investment factor is a measure of the net investment experience of a
sub-account during the valuation period.
The net investment factor for a valuation period is: the gross investment rate
for such valuation period, less a deduction for the charges under this policy
which are assessed against separate account assets. The gross investment rate is
equal to:
1. The net asset value per share of a fund share held in the sub-account of the
separate account determined at the end of the current valuation period; plus
2. the per-share amount of any dividend or capital gain distributions by the
fund if the "ex-dividend" date occurs during the current valuation period,
divided by
3. the net asset value per share of that fund share held in the sub-account
determined at the end of the preceding valuation period.
MHC-94-18665 Rev. 5-2001 Minnesota Life 12
ACCOUNT VALUES
--------------
WILL THE OWNER HAVE ACCESS TO THE NET CASH VALUE?
Yes. The owner has access to this policy's net cash value. The net cash value is
the account value of this policy, less any outstanding policy loans and accrued
policy loan interest charged and any charges overdue.
HOW IS THE ACCOUNT VALUE DETERMINED?
It is determined separately for this policy and separately for the separate
account value and loan account value. The separate account value will include
all sub-accounts of the separate account.
The separate account value is the sum of units of each sub-account, credited to
the policy, multiplied by the accumulation unit value for that sub-account. Once
determined, the number of units credited to this policy under an owner's policy
will not be affected by changes in the unit value. However, the number of units
will be increased by the allocation of subsequent net premiums, policy
experience credits, loan repayments, loan interest credits and transfers to that
sub-account. The number of units credited to a sub-account under an owner's
policy will be decreased by deductions to that sub-account, policy loans and
loan interest charged, transfers from that sub-account and partial surrenders
from that sub-account. The number of sub-account units will decrease to zero on
a policy termination.
IS THE SEPARATE ACCOUNT VALUE GUARANTEED?
The separate account value is not guaranteed.
The guaranteed account value is guaranteed by us. It cannot be reduced by the
investment experience of the guaranteed account.
ARE THERE LIMITATIONS ON TRANSFERS?
Yes. Interest is credited on the guaranteed account value under this policy.
Interest is credited daily at a rate of not less than three percent per year,
compounded annually. We guarantee this minimum rate for the life of the policy.
MAY ADDITIONAL INTEREST BE CREDITED ON THE GUARANTEED ACCOUNT?
Yes. As conditions permit, we may credit additional amounts of interest to the
guaranteed account value.
MAY THIS POLICY BE SURRENDERED?
Yes. The owner of this policy may request the surrender of this policy at any
time while the insured under this policy is living.
WHAT IS THE SURRENDER VALUE OF THIS POLICY?
The surrender value of this policy is the net cash value.
MHC-94-18665 Rev. 5-2001 Minnesota Life 13
MHC-94-18665 Rev. 5-2001 Minnesota Life 13
The determination of the surrender value is made as of the end of the valuation
period during which we receive the surrender request at our home office.
IS A PARTIAL SURRENDER PERMITTED?
Yes. The owner may make a partial surrender of the net cash value under this
policy. The amount of a partial surrender must be $500 or more and it cannot
exceed the amount available as a policy loan. A partial surrender will cause a
decrease in the face amount equal to the amount surrendered. We reserve the
right to change the minimum amount or limit the number of times the owner may
make a partial surrender.
MAY THE OWNER DIRECT US AS TO HOW PARTIAL SURRENDERS WILL BE TAKEN FROM THE NET
CASH VALUE?
Yes. The owner may tell us the sub-accounts from which a partial surrender is to
be taken or whether it is to be taken in whole or in part from the guaranteed
account. If the owner does not, partial surrenders will be deducted from the
guaranteed account value and separate account value in the same proportion that
those values bear to each other and, as to the separate account value, from each
sub-account in the proportion that the sub-account value of each such sub-
account bears to the separate account value.
HOW WILL THE OWNER KNOW THE STATUS OF A POLICY?
Each year we will send the owner of this policy a report. This report will show
the status of this policy. It will include the account value, the face amount as
of the date of the report, the premiums paid during the year and their
allocation, policy charges, policy loan activity and the net cash value. The
report will be sent without cost to the owner. The report will be as of a date
within two months of its mailing.
POLICY LOANS
------------
CAN THE OWNER BORROW AGAINST THE NET CASH VALUE?
Yes. The owner may borrow an amount of at least $100 and up to the maximum loan
amount. This amount is determined as of the date we receive the request for a
loan. We will require the owner's written or telephone request for a policy
loan. The policy will be the only security required for a loan. We will charge
interest on the loan in arrears.
When a loan is to come from the guaranteed account value, we have the right to
postpone a loan for up to six months.
WHAT IS THE MAXIMUM LOAN AMOUNT AVAILABLE FOR A POLICY LOAN?
The total amount available for a loan under this policy is (a) minus (b), where
(a) is 90 percent of the account value and (b) is any outstanding policy loans
plus accrued policy loan interest charged. The maximum loan amount will be
determined as of the date we receive the owner's written or telephone request
for a loan at our home office.
WHAT IS THE EFFECT OF A POLICY LOAN?
MHC-94-18665 Rev. 5-2001 Minnesota Life 14
When a loan is taken on this policy, we will reduce the net cash value of this
policy by the amount borrowed. This determination will be made as of the end of
the valuation period during which the loan request is received at our home
office. The amount borrowed continues to be a part of the account value, as the
amount borrowed becomes part of the loan account value where it will accrue loan
interest credits, and will be held in our general account.
HOW DOES A POLICY LOAN REDUCE NET CASH VALUE ON THIS POLICY?
Unless the owner directs us otherwise, the policy loan will be taken from this
policy's guaranteed account value and separate account value in the same
proportion that those values bear to each other and, as to the separate account
value, from each sub-account in the proportion that the sub-account value in
each such sub-account bears to the separate account value. The number of units
to be canceled will be based upon the value of the units as of the end of the
valuation period during which the loan request is received at our home office.
The net cash value of this policy may decrease between premium due dates. The
net cash value will decrease by the same amount of any decrease in account value
or increase in the amount borrowed or in the interest due on the loan of this
policy. If this policy has a policy loan and no net cash value, this policy will
lapse.
WHAT IS THE INTEREST RATE ON POLICY LOANS?
The interest rate charged on a policy loan will be eight percent per year.
As the interest charged on a policy loan accrues, the net cash value decreases.
Interest is due at the end of the policy month. If the total interest accrued at
the end of the policy month is not paid, this interest will be added to the loan
amount borrowed and charged the same rate of interest as the loan.
WHAT IS THE RATE OF INTEREST CREDITED TO THIS POLICY AS A RESULT OF A LOAN?
Interest credits which accrue on the loan account value shall be at a rate which
is not less than six percent per year.
WHEN ARE INTEREST CREDITS ON A POLICY LOAN ALLOCATED TO THIS POLICY'S GUARANTEED
ACCOUNT VALUE?
Interest credits are allocated to the guaranteed account value at the time of a
loan repayment.
WHEN AND IN WHAT AMOUNT SHOULD LOAN REPAYMENTS BE MADE?
A policy loan and the interest charged on the loan may be repaid in full or in
part at any time before the insured's death so long as the insurance coverage
under the policy is in force. The loan may also be repaid within 60 days after
the date of the insured's death, if we have not paid any of the death benefits
under this policy. Any loan repayment must be at least $100 unless the balance
due is less than $100.
HOW DO LOAN REPAYMENTS AFFECT THE LOAN ACCOUNT VALUES AND THE GUARANTEED ACCOUNT
VALUE?
MHC-94-18665 Rev. 5-2001 Minnesota Life 15
Loan repayments increase the net cash value of a policy by the amount of the
loan repayment The loan repayment will be applied first to the interest charged
on the principal amount borrowed. Any remaining portion of the repayment will
then reduce the original loan principal amount.
When a loan repayment is made, the interest credits in the loan account value
are transferred to the general account value in the same proportion that loan
interest charged has been reduced due to the loan repayment. Also, an amount
equal to the amount of loan principal repaid is transferred from the loan
account value to the general account value.
WHAT HAPPENS IF A LOAN ON THIS POLICY IS NOT REPAID?
If this policy has a policy loan, the policy will remain in force so long as it
has net cash value. If it does not have sufficient net cash value, it will
lapse.
In this event, to keep this policy in force, the owner will have to make a loan
repayment. We will give the owner notice of our intent to terminate this policy
and the loan repayment required to keep it in force. The time for repayment will
be within 61 days after our mailing of the warning notice of lapse.
TERMINATION
-----------
WHEN DOES THIS POLICY TERMINATE?
The insurance on the life of an insured will terminate on the earliest of:
1 61 days after we mail a warning notice of lapse on a policy monthly
anniversary in which the net cash value is insufficient to pay for the
monthly deductions and no premium is paid during the grace period;
2 the date an owner surrenders this policy or requests that we terminate the
insurance;
3 the 95th birthday of the insured.
WILL THE OWNER OF THIS POLICY RECEIVE NOTICE PRIOR TO THE TERMINATION OF
INSURANCE?
If the owner's insurance will be terminated because the net cash value is less
than that required to pay the monthly deductions, we will give the owner at
least 61 days prior written notice of lapse before terminating the insurance.
CAN INSURANCE ON THE LIFE ON AN INSURED BE REINSTATED AFTER TERMINATION?
Insurance terminated due to the insufficiency of the net cash value to pay for
the monthly deductions may be reinstated. Reinstatement must occur while the
insured is living and any time within three years from the date of lapse.
Reinstatement is made by payment of an amount that, after the deduction of
percentage-of-premium charges, is large enough to cover all monthly deductions
which have accrued on this policy up to the effective date of reinstatement plus
the monthly deductions for the two months following the effective date of
reinstatement. If any policy loans and policy loan interest charged is not
repaid, this indebtedness will be reinstated along with the insurance. No
evidence of the insured's insurability will be required during the first 31 days
following lapse, but will be required from the 32nd day to three years from the
date of lapse.
MHC-94-18665 Rev. 5-2001 Minnesota Life 16
ADDITIONAL INFORMATION
----------------------
WILL THIS POLICY RECEIVE EXPERIENCE CREDITS?
Each year we will determine if this policy will receive an experience credit.
Experience credits, if received, will be added to the account value of this
policy or, if elected by the owner, may be paid in cash. An experience credit
applied to the account value will be allocated to the guaranteed account value
or the sub-accounts of the separate account in accordance with the owner's
current instructions for the allocation of net premiums. In the absence of such
instructions, experience credits will be allocated to the guaranteed account and
the separate account in the same proportion as those values bear to each other
and, as to the separate account value, to each sub-account in the proportion
that the sub-account value of each sub-account bears to the separate account
value.
MAY THE OWNER ASSIGN ANY INTEREST UNDER THIS POLICY?
Yes. However, we will not be bound by an assignment of this policy or of any
interest in it unless:
1. It is made as a written instrument;
2. The owner files the original instrument or a certified copy with us at our
home office; and
3. We send the owner an acknowledged copy.
We are not responsible for the validity of any assignment. If a claim is based
on an assignment, we may require proof of interest of the claimant. A valid
assignment will take precedence over any claim of a beneficiary.
WHAT IF AN INSURED'S AGE IS MISSTATED?
If the age of the insured has been misstated, the death benefit and account
value will be adjusted. The adjustment will be the difference between two
amounts accumulated with interest. These two amounts are:
1. the monthly cost of insurance charges that were paid, and;
2. the monthly cost of insurance charges that should have been paid based on
the insured's correct age.
The interest rates used are the rates that were used in accumulating the
guaranteed account values.
WHEN DOES AN INSURED'S INSURANCE BECOME INCONTESTABLE?
After the insurance has been in force during the insured's lifetime for a two
year period from the policy date, we cannot contest the insurance for any loss
that is incurred more than two years after the policy date, unless the net cash
value has dropped below the amount necessary to pay the insured's cost of
insurance on the insured's life. However, if there has been an increase in the
amount of insurance for which we required evidence of insurability, then, to the
extent of the increase, any loss which occurs within two years of the effective
date of the increase will be contestable.
MHC-94-18665 Rev. 5-2001 Minnesota Life 17
IS THERE A SUICIDE EXCLUSION?
Yes. If an insured, whether sane or insane, dies by suicide, within two years of
the policy date, our liability will be limited to an amount equal to the premium
paid for that insured. If there has been an increase in the face amount of
insurance for which we required evidence of insurability, and if the insured
dies by suicide within two years of the effective date of the increase, our
liability with respect to that increase will be limited to the cost of insurance
charge attributable to such increase.
ARE INSURANCE AND RELATED RECORDS OF THE PLAN SPONSOR OPEN FOR INSPECTION?
Yes. The plan sponsor's records shall be open to inspection by us, at all
reasonable times, for any purposes relating to the provisions of the policy.
DO YOU HAVE ANY ADDITIONAL VOTING RIGHTS?
Yes. If you have separate account units under this policy you may direct us with
respect to the voting rights of fund shares held by us and attributable to this
policy.
COULD THE PAYMENT OF POLICY PROCEEDS BE POSTPONED?
Normally, we will pay any policy proceeds within seven days after our receipt of
all the documents required for such a payment. Other than the death proceeds,
which are determined as of the date of death of the insured, the amount of
payment will be determined as of the end of the valuation period during which a
request is received at our home office. However, we reserve the right to defer
policy payments, including policy loans, for up to six months from the date of
the owner's request, if such payments are based upon policy values which do not
depend on the investment performance of the separate account. In that case, if
we postpone a payment other than a policy loan payment for more than 31 days, we
will pay the owner interest at the greater of three percent per year or the rate
required by law for the period beyond that time that payment is postponed. For
payments based on account values which do depend on the investment performance
of the separate account, we may defer payment only: (a) for any period during
which the New York Stock Exchange is closed for trading (except for normal
holiday closing); or (b) when the Securities and Exchange Commission has
determined that a state of emergency exists which may make such payment
impractical.
WILL THE PROVISIONS OF THIS POLICY CONFORM WITH STATE LAW?
Yes. If any provision in this policy is in conflict with the laws of the state
governing the policy, the provision will be deemed to be amended to conform to
such laws.
COULD ANY PAYMENTS MADE UNDER THIS POLICY BE SUBJECT TO CLAIMS OF CREDITORS?
To the extent permitted by law, neither this policy nor any payment hereunder
will be subject to the claims of creditors or to any legal process.
ARE POLICY CHANGES LIMITED?
MHC-94-18665 Rev. 5-2001 Minnesota Life 18
Currently, the frequency of policy changes are not limited. However, we reserve
the right to limit the number of policy changes to one per policy year and to
restrict such changes in the first policy year. For this purpose, changes
include increases or decreases in the face amount of insurance.
MHC-94-18665 Rev. 5-2001 Minnesota Life 19
TABLE A
MINNESOTA LIFE INSURANCE COMPANY
GUARANTEED MAXIMUM MONTHLY COST OF INSURANCE RATE
ON A SMOKER DISTINCT BASIS
PER $1,000 NET AMOUNT AT RISK
[Enlarge/Download Table]
MAXIMUM MAXIMUM MAXIMUM
ATTAINED MONTHLY ATTAINED MONTHLY ATTAINED MONTHLY
AGE* RATE AGE* RATE AGE* RATE
---- ---- ---- ---- ---- ----
NON-SMOKERS SMOKERS NON-SMOKERS SMOKERS NON-SMOKERS SMOKERS
----------- ------- ----------- ------- ----------- -------
0 0.254 0.254 35 0.174 0.265 70 3.427 5.191
1 0.102 0.102 36 0.184 0.285 71 3.797 5.648
2 0.098 0.098 37 0.197 0.310 72 4.230 6.171
3 0.096 0.096 38 0.210 0.338 73 4.724 6.757
4 0.093 0.093 39 0.225 0.369 74 5.273 7.405
5 0.088 0.088 40 0.243 0.406 75 5.864 8.100
6 0.084 0.084 41 0.261 0.445 76 6.491 8.815
7 0.079 0.079 42 0.281 0.488 77 7.149 9.540
8 0.077 0.077 43 0.302 0.534 78 7.845 10.278
9 0.076 0.076 44 0.324 0.584 79 8.600 11.058
10 0.076 0.076 45 0.350 0.636 80 9.439 11.904
11 0.082 0.082 46 0.377 0.691 81 10.384 12.841
12 0.091 0.091 47 0.407 0.749 82 11.456 13.886
13 0.104 0.104 48 0.439 0.813 83 12.649 15.034
14 0.118 0.118 49 0.474 0.882 84 13.943 16.241
15 0.129 0.163 50 0.514 0.958 85 15.311 17.473
16 0.139 0.179 51 0.559 1.043 86 16.737 18.705
17 0.147 0.192 52 0.611 1.140 87 18.205 19.973
18 0.152 0.202 53 0.671 1.249 88 19.710 21.295
19 0.156 0.208 54 0.736 1.367 89 21.271 22.625
20 0.158 0.212 55 0.808 1.492 90 22.908 24.006
21 0.157 0.212 56 0.885 1.624 91 24.659 25.457
22 0.154 0.210 57 0.967 1.760 92 26.588 27.118
23 0.152 0.208 58 1.056 1.903 93 28.870 29.192
24 0.149 0.204 59 1.156 2.056 94 31.894 32.006
25 0.146 0.199 60 1.268 2.228
26 0.144 0.197 61 1.395 2.424
27 0.143 0.197 62 1.544 2.650
28 0.143 0.198 63 1.714 2.904
29 0.144 0.202 64 1.903 3.184
30 0.146 0.208 65 2.110 3.480
31 0.149 0.215 66 2.332 3.788
32 0.153 0.223 67 2.568 4.104
33 0.159 0.235 68 2.823 4.434
34 0.166 0.249 69 3.105 4.792
*This is the insured employee's attained age as of the last certificate
anniversary.
MHC-94-18665 Rev. 5-2001 Minnesota Life 20
TABLE A
MINNESOTA LIFE INSURANCE COMPANY
GUARANTEED MAXIMUM MONTHLY COST OF INSURANCE RATE
ON A UNI-SMOKER BASIS
PER $1,000 NET AMOUNT AT RISK
[Download Table]
MAXIMUM MAXIMUM MAXIMUM
ATTAINED MONTHLY ATTAINED MONTHLY ATTAINED MONTHLY
AGE* RATE AGE* RATE AGE* RATE
---- ---- ---- ---- ---- ----
UNI-SMOKERS UNI-SMOKERS UNI-SMOKERS
----------- ----------- -----------
0 0.254 35 0.214 70 3.835
1 0.102 36 0.229 71 4.214
2 0.098 37 0.246 72 4.654
3 0.096 38 0.265 73 5.157
4 0.093 39 0.287 74 5.712
5 0.088 40 0.312 75 6.310
6 0.084 41 0.339 76 6.941
7 0.079 42 0.368 77 7.599
8 0.077 43 0.398 78 8.289
9 0.076 44 0.431 79 9.033
10 0.076 45 0.465 80 9.857
11 0.082 46 0.502 81 10.784
12 0.091 47 0.541 82 11.835
13 0.104 48 0.583 83 13.006
14 0.118 49 0.629 84 14.270
15 0.134 50 0.681 85 15.605
16 0.148 51 0.739 86 16.991
17 0.159 52 0.805 87 18.421
18 0.168 53 0.879 88 19.895
19 0.174 54 0.960 89 21.422
20 0.176 55 1.047 90 23.024
21 0.177 56 1.138 91 24.740
22 0.176 57 1.234 92 26.640
23 0.173 58 1.334 93 28.901
24 0.171 59 1.444 94 31.905
25 0.167 60 1.568
26 0.166 61 1.709
27 0.166 62 1.871
28 0.166 63 2.055
29 0.169 64 2.259
30 0.172 65 2.478
31 0.178 66 2.711
32 0.184 67 2.956
33 0.193 68 3.217
34 0.202 69 3.507
*This is the insured employee's attained age as of the last certificate
anniversary.
MHC-94-18665 Rev. 5-2001 Minnesota Life 21
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Minnesota Life
400 Robert Street North . St. Paul, Minnesota 55101-2098
VARIABLE UNIVERSAL LIFE INSURANCE . LEVEL DEATH BENEFIT. NONPARTICIPATING
MHC-94-18665 Rev. 5-2001 Minnesota Life 22
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