THE TRAVELERS INSURANCE COMPANY - ONE TOWER SQUARE - HARTFORD, CT 06183
A STOCK COMPANY
CORPORATE FLEXIBLE PREMIUM VARIABLE LIFE INSURANCE POLICY
We will pay the Death Benefit to the Beneficiary upon receipt at Our Office of
Due Proof of the Insured's Death while this policy is in force. Refer to the
"Death Benefit" provision on Page 5 and to the "Policy Values" section on Page 6
for information on determining the amount payable at death.
READ YOUR POLICY CAREFULLY
This is a legal contract between you and us.
RIGHT TO CANCEL
We want you to be satisfied with the policy you have purchased. We urge you to
examine it closely. If, for any reason, you are not satisfied, you may return
the policy to us or to the agent from whom it was purchased to be cancelled
within the latest of:
1. 10 days after the policy was delivered to you; or
2. 10 days after we have mailed or delivered the Notice of the
Right to Cancel to you; or
3. 45 days after the date the application for this policy was
signed.
Within 7 days after our receipt of your request In Writing for a refund, we will
refund to you the Contract Value of the policy on the date we receive the
returned policy; plus any charges and expenses which may have been deducted;
less any Loan Account value. After the policy is returned, it will be considered
as if it were never in effect.
Signed at Hartford, Connecticut
/s/ GEORGE C. KOKULES
President
CORPORATE FLEXIBLE PREMIUM VARIABLE LIFE INSURANCE POLICY
INSURANCE PAYABLE AT INSURED'S DEATH
NON-PARTICIPATING
THE AMOUNT AND DURATION OF THE DEATH BENEFIT AND OTHER VALUES PROVIDED BY THIS
POLICY ARE BASED ON THE INVESTMENT EXPERIENCE OF THE SEPARATE ACCOUNT(S). ALL
SEPARATE ACCOUNT VALUES ARE VARIABLE, MAY INCREASE OR DECREASE, AND ARE NOT
GUARANTEED AS TO FIXED DOLLAR AMOUNT.
TABLE OF CONTENTS
Right to Cancel Policy Jacket
Policy Summary Page 3
Definitions Page 4
Benefits--Basic Policy Page 5
Policy Values Page 6
Premium and Valuation Provisions Page 8
Separate Account Option Valuation Page 8
Transfers Between Investment Options Page 9
Continuation of Insurance, Grace Period and Reinstatement Page 9
Ownership Rights Page 10
General Provisions Page 10
Settlement Options
A copy of the application and any riders follows the
Settlement Options.
POLICY SUMMARY
POLICY NUMBER: STATED AMOUNT: $ 100,000
INSURED: JOHN DOE POLICY DATE: MAY 01, 1999
AGE: 35 ISSUE DATE: MAY 01, 1999
MATURITY DATE: MAY 01, 2064
MONTHLY DEDUCTION DAY: 1ST DAY OF MONTH
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BENEFIT DESCRIPTION
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INITIAL STATED AMOUNT: $ 100,000
INITIAL PREMIUM: $ 469
PLANNED PREMIUM: $ 469
PLANNED PREMIUMS PAYABLE: ANNUALLY
TARGET PREMIUM: [$ 4118]
INSURANCE OPTION: [1] (LEVEL)
MINIMUM STATED AMOUNT [$ 50,000]
MINIMUM ANNUAL EFFECTIVE RATE: 3%
MAXIMUM CHANGE AGE [80]
MINIMUM INCREASE AMOUNT: [$ 5,000]
MINIMUM LOAN AMOUNT: WE RESERVE THE RIGHT TO LIMIT THE MINIMUM LOAN AMOUNT TO $500
MAXIMUM LOAN AMOUNT: 100% OF CONTRACT VALUE MINUS INDEBTEDNESS AS OF THE DATE WE
RECEIVE YOUR LOAN REQUEST.
ANNUAL INTEREST RATE
CHARGED TO INDEBTEDNESS: 5% CHARGED IN ARREARS
MINIMUM ANNUAL INTEREST RATE
CREDITED TO LOAN ACCOUNTS: 4%
DEATH BENEFIT INTEREST FACTOR: 1.00327374
MINIMUM PARTIAL SURRENDER WE RESERVE THE RIGHT TO LIMIT THE MINIMUM PARTIAL SURRENDER
AMOUNT: AMOUNT TO $500
MAXIMUM PREMIUM TAX 2.25% OF EACH PREMIUM PAID
CHARGE:
MAXIMUM FEDERAL DEFERRED 1.25% OF EACH PREMIUM PAID
ACQUISITION TAX CHARGE:
MAXIMUM SALES EXPENSE CHARGE: 11.50% UP TO TARGET PREMIUM PAID ALL YEARS.
8.50% ABOVE TARGET PREMIUM PAID ALL YEARS.
PAGE 3(A)
POLICY SUMMARY
POLICY NUMBER: STATED AMOUNT: $ 100,000
INSURED: JOHN DOE POLICY DATE: MAY 01, 1999
AGE: 35 ISSUE DATE: MAY 01, 1999
MATURITY DATE: MAY 01, 2064
MONTHLY DEDUCTION DAY: 1ST DAY OF MONTH
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BENEFIT DESCRIPTION
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GUARANTEED MONTHLY
ADMINISTRATIVE EXPENSE CHARGE: $30.00 ALL YEARS, PLUS [$0.10] PER THOUSAND OF PER THOUSAND DEATH
BENEFIT FOR 20 YEARS. THIS LOAD APPLIES TO THE INITIAL STATED
AMOUNT AND ANY APPLIED FOR INCREASES IN COVERAGE. THE
DURATION OF THE LOAD IS MEASURED FROM THE SEGMENT EFFECTIVE
DATE.
MAXIMUM MONTHLY
CASE EXPENSE CHARGE: $60.00 DIVIDED INTO THE NUMBER OF POLICIES IN A CASE.
RATE CLASS: MALE PREFERRED NONSMOKER
PAGE 3(A) continued
POLICY SUMMARY
POLICY NUMBER: STATED AMOUNT: $ 100,000
INSURED: JOHN DOE POLICY DATE: MAY 01, 1999
AGE: 35 ISSUE DATE: MAY 01, 1999
MATURITY DATE: MAY 01, 2064
MONTHLY DEDUCTION DAY: 1ST DAY OF MONTH
--------------------------------------------------------------------------------
SEPARATE ACCOUNT:
THE TRAVELERS FUND UL FOR VARIABLE LIFE INSURANCE
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UNDERLYING FUNDS:
[CAPITAL APPRECIATION FUND
HIGH YIELD BOND TRUST
MONEY MARKET PORTFOLIO
ALLIANCE VARIABLE PRODUCT SERIES FUND, INC.
PREMIER GROWTH PORTFOLIO - CLASS B
CREDIT SUISSE WARBURG PINCUS TRUST
EMERGING MARKETS PORTFOLIO
DELAWARE GROUP PREMIUM FUND
REIT SERIES
DEUTSCH ASSET MANAGEMENT, INC.
EAFE EQUITY INDEX FUND
SMALL CAP INDEX FUND
DREYFUS VARIABLE INVESTMENT FUND
APPRECIATION PORTFOLIO - INITIAL SHARES
SMALL CAP PORTFOLIO - INITIAL SHARES
FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST
FRANKLIN SMALL CAP FUND - CLASS 2
GREENWICH STREET SERIES FUND
EQUITY INDEX PORTFOLIO - CLASS 1 SHARES
JANUS ASPEN SERIES
BALANCED PORTFOLIO - SERVICE SHARES
GLOBAL TECHNOLOGY PORTFOLIO - SERVICE SHARES
WORLDWIDE GROWTH PORTFOLIO - SERVICE SHARES
PIMCO VARIABLE INSURANCE TRUST
TOTAL RETURN BOND PORTFOLIO
PUTNAM VARIABLE TRUST
PUTNAM VT INTERNATIONAL GROWTH FUND - CLASS IB SHARES
PUTNAM VT SMALL CAP VALUE FUND - CLASS IB SHARES
PUTNAM VT VOYAGER II FUND - CLASS IB SHARES
SALOMON BROTHERS VARIABLE SERIES FUND INC.
CAPITAL FUND
INVESTORS FUND
STRATEGIC BOND FUND
TOTAL RETURN FUND
TRAVELERS SERIES FUND, INC.
AIM CAPITAL APPRECIATION PORTFOLIO
ALLIANCE GROWTH PORTFOLIO
MFS TOTAL RETURN PORTFOLIO
SMITH BARNEY INTERNATIONAL ALL CAP GROWTH PORTFOLIO
SMITH BARNEY LARGE CAPITALIZATION GROWTH PORTFOLIO
VAN KAMPEN ENTERPRISE PORTFOLIO
PAGE 3(B)
POLICY SUMMARY
POLICY NUMBER: STATED AMOUNT: $ 250,000
INSURED: JOHN DOE POLICY DATE: MAY 01, 2000
AGE: 35 ISSUE DATE: MAY 01, 2000
MATURITY DATE: MAY 01, 2065
MONTHLY DEDUCTION DAY: 1ST DAY OF MONTH
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SEPARATE ACCOUNT:
THE TRAVELERS FUND UL FOR VARIABLE LIFE INSURANCE
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UNDERLYING FUNDS (CONTINUED):
TRAVELERS SERIES TRUST
CONVERTIBLE BOND PORTFOLIO
DISCIPLINED MID CAP STOCK PORTFOLIO
EQUITY INCOME PORTFOLIO (FIDELITY)
LARGE CAP PORTFOLIO (FIDELITY)
LAZARD INTERNATIONAL STOCK PORTFOLIO
MFS EMERGING GROWTH PORTFOLIO
MFS MID CAP GROWTH PORTFOLIO
MFS RESEARCH PORTFOLIO
SOCIAL AWARENESS STOCK PORTFOLIO
QUALITY BOND PORTFOLIO
U.S. GOVERNMENT SECURITIES PORTFOLIO
VARIABLE INSURANCE PRODUCTS FUND II
ASSET MANAGER PORTFOLIO - INITIAL CLASS
CONTRAFUND PORTFOLIO - SERVICE CLASS 2
VARIABLE INSURANCE PRODUCTS FUND III
MID CAP PORTFOLIO - SERVICE CLASS 2]
PAGE 3(B) Continued
POLICY SUMMARY
POLICY NUMBER: STATED AMOUNT: $ 100,000
INSURED: JOHN DOE POLICY DATE: MAY 01, 1999
AGE: 35 ISSUE DATE: MAY 01, 1999
MATURITY DATE: MAY 01, 2064
MONTHLY DEDUCTION DAY: 1ST DAY OF MONTH
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THE MAXIMUM INVESTMENT OPTION DAILY DEDUCTION FOR ALL INVESTMENT OPTIONS (IN
BASIS POINTS) IS [.2055 ] WHICH INCLUDES MORTALITY AND EXPENSE CHARGES FOR ALL
POLICY YEARS.
INFORMATION ABOUT THE SEPARATE ACCOUNT IS PROVIDED IN THE PROSPECTUS FOR THE
SEPARATE ACCOUNT. YOU SHOULD CAREFULLY REVIEW THE PROSPECTUS.
WE RESERVE THE RIGHT TO LIMIT FREE TRANSFERS AMONG THE INVESTMENT OPTIONS TO SIX
TIMES IN ANY POLICY YEAR AND TO CHARGE A $10 FEE FOR EACH ADDITIONAL TRANSFER
THAT WE ALLOW.
WE WILL ALLOCATE ANY NET PREMIUM TO ANY INVESTMENT OPTION WHICH HAD BEEN
SELECTED DURING THE RIGHT TO CANCEL PERIOD.
PREMIUM FOR THE BASIC POLICY MAY BE PAID UNTIL THE MATURITY DATE. CHARGES FOR
RIDERS ARE PAYABLE TO THE EXPIRY DATE. NO INSURANCE WILL BE IN EFFECT UNLESS AT
LEAST ONE DEDUCTION AMOUNT HAS BEEN PAID.
INSURANCE UNDER THIS POLICY MAY END BEFORE THE MATURITY DATE IF PREMIUM PAYMENT
AND/OR INVESTMENT EXPERIENCE ARE INSUFFICIENT TO CONTINUE INSURANCE TO SUCH
DATE.
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TABLE OF MAXIMUM MONTHLY GUARANTEED COST OF INSURANCE RATES
(MONTHLY RATE FOR EACH $1,000 OF COVERAGE)
--------------------------------------------------------------------------------
POLICY MAXIMUM POLICY MAXIMUM POLICY MAXIMUM
YEAR RATE YEAR RATE YEAR RATE
------ ------- ------ ------- ------ -------
1 0.1810 23 1.0932 45 8.2619
2 0.1935 24 1.1894 46 9.0119
3 0.2077 25 1.2942 47 9.8582
4 0.2236 26 1.4109 48 10.8223
5 0.2420 27 1.5430 49 11.9024
6 0.2629 28 1.6923 50 13.0775
7 0.2854 29 1.8597 51 14.3247
8 0.3097 30 2.0454 52 15.6263
9 0.3365 31 2.2459 53 16.9762
10 0.3649 32 2.4605 54 18.3754
11 0.3950 33 2.6886 55 19.8343
12 0.4277 34 2.9344 56 21.3788
13 0.4620 35 3.2068 57 23.0518
14 0.4989 36 3.5147 58 24.9371
15 0.5399 37 3.8670 59 27.2442
16 0.5852 38 4.2723 60 30.4453
17 0.6381 39 4.7329 61 35.4922
18 0.6968 40 5.2401 62 44.5151
19 0.7640 41 5.7847 63 62.8314
20 0.8380 42 6.3595 64 83.3333
21 0.9180 43 6.9577 65 83.3333
22 1.0030 44 7.5852
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RATE CLASS: MALE PREFERRED NONSMOKER
THE RATES USED FOR THE COST OF INSURANCE DEDUCTION ARE GUARANTEED NOT TO EXCEED
THE MAXIMUM RATES SHOWN ABOVE. THE RATES ARE BASED ON THE 1980 COMMISSIONER'S
STANDARD ORDINARY MORTALITY TABLE. THE COST OF INSURANCE IS DEDUCTED ON THE
MONTHLY DEDUCTION DAY.
PAGE 3 (COI)
POLICY SUMMARY
POLICY NUMBER: STATED AMOUNT: $ 100,000
INSURED: JOHN DOE POLICY DATE: MAY 01, 1999
AGE: 35 ISSUE DATE: MAY 01, 1999
MATURITY DATE: MAY 01, 2064
MONTHLY DEDUCTION DAY: 1ST DAY OF MONTH
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MINIMUM AMOUNT INSURED: THE FOLLOWING PERCENTAGE OF THE CASH VALUE ARE THE
MINIMUM AMOUNT INSURED ON ANY POLICY ANNIVERSARY.
--------------------------------------------------------------------------------
POLICY MAXIMUM POLICY MAXIMUM POLICY MAXIMUM
YEAR RATE YEAR RATE YEAR RATE
------ ------- ------ ------- ------ -------
1 391% 23 202% 45 134%
2 379% 24 196% 46 133%
3 366% 25 191% 47 131%
4 355% 26 187% 48 129%
5 343% 27 182% 49 128%
6 332% 28 178% 50 127%
7 322% 29 174% 51 120%
8 312% 30 170% 52 119%
9 302% 31 166% 53 118%
10 293% 32 162% 54 117%
11 284% 33 159% 55 116%
12 276% 34 155% 56 115%
13 268% 35 152% 57 114%
14 260% 36 149% 58 113%
15 252% 37 146% 59 112%
16 245% 38 144% 60 111%
17 238% 39 141% 61 109%
18 231% 40 139% 62 108%
19 225% 41 142% 63 107%
20 218% 42 140% 64 106%
21 213% 43 138% 65 104%
22 207% 44 136%
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RATE CLASS: MALE PREFERRED NONSMOKER
PAGE 3(C)
DEFINITIONS
ACCUMULATION UNIT: a standard of measurement used to determine the values in
each Investment Option.
AGE: the Insured's age as of the Insured's last birthday.
AMOUNT INSURED: If Death Benefit Option 1 is selected, the Amount Insured is the
Stated Amount or the Minimum Amount Insured, whichever is greater. If Death
Benefit Option 2 is selected, the Amount Insured is the Stated Amount plus the
Contract Value or the Minimum Amount Insured, whichever is greater.
BENEFICIARY(IES): the person(s) named to receive the benefits of this policy at
the Insured's death.
CASH SURRENDER VALUE: the Contract Value less any Indebtedness.
CONTRACT VALUE: the sum of the values held in the Investment Options and the
Loan Account.
DEATH BENEFIT: the amount payable to the Beneficiary if the Insured dies while
the policy is in force.
DEDUCTION AMOUNT: a monthly charge, deducted from the Contract Value, which is
comprised of the cost of insurance charge and any other monthly charge shown on
the Policy Summary and any charge for supplemental benefits.
DEDUCTION DAY: is the day of each month on which the Deduction Amount is
deducted. Shown on the Policy Summary.
DUE PROOF OF THE INSURED'S DEATH: a copy of a certified death certificate; a
copy of a certified decree of a court of a competent jurisdiction as to the
finding of death; a written statement by a medical doctor who attended the
deceased; or any other proof satisfactory to us.
GENERAL ACCOUNT: the General Account is made up of all of our assets other than
those held in any separate investment account.
IN WRITING: in a written form satisfactory to us and received at Our Office.
INDEBTEDNESS: any amount you owe to us as a result of a policy loan.
Indebtedness consists of principal amount plus any accrued interest.
INSURED: the person on whose life this policy is issued. Shown on the Policy
Summary.
INVESTMENT OPTION: a division of the Separate Account which invests directly in
a corresponding Underlying Fund.
ISSUE DATE: the date on which we issue the policy. Shown on the Policy Summary.
LOAN ACCOUNT: the account to which we transfer the amount of any policy loan and
to which we credit interest.
MATURITY DATE: an anniversary of the Policy Date on which the policy matures
(see Maturity Benefit, page 5). Shown on the Policy Summary.
MAXIMUM INVESTMENT OPTION DAILY DEDUCTION: the maximum charge that we deduct
from each Investment Option to cover our mortality and expense risk charges.
Shown on the Policy Summary.
MINIMUM AMOUNT INSURED: a stated percentage of the Contract Value determined as
of the first day of the Policy Month. Shown on the Policy Summary.
NET AMOUNT AT RISK: the Amount Insured for the month divided by the Death
Benefit Interest Factor minus the Contract Value.
NET PREMIUM: actual premium minus the sales expense charges. The sales expense
charge is shown on the Policy Summary. We may, at Our discretion, apply a lower
percentage of premium charges.
OUR OFFICE: The Travelers Insurance Company, Policyholder Services, One Tower
Square, Hartford, Connecticut 06183-5071 or any other office which we may
designate for the purpose of administering this policy.
OWNER: The Owner has all rights under this Policy and is named in the
Application.
PER THOUSAND DEATH BENEFIT: the lesser of the Initial Death Benefit or twenty
(20) times the Target Premium.
POLICY ANNIVERSARY: an anniversary of the Policy Date.
POLICY DATE: the date on which the policy becomes effective. Shown on the Policy
Summary.
POLICY MONTH: twelve one-month periods during the Policy Year, each of which
begins on the Policy Date or the monthly Deduction Day. This date will not be on
the 29th, 30th or 31st of any given month.
POLICY YEAR: each successive twelve-month period; the first beginning with the
Policy Date.
Page 4
SEC: the Securities and Exchange Commission.
SEPARATE ACCOUNT: an account which We established for this class of policies and
certain other policies. The Separate Account is shown on the Policy Summary and
is divided into segments that correspond to the Investment Options.
STATED AMOUNT: a dollar amount used to determine the Death Benefit of the
policy. Shown on the Policy Summary.
TARGET PREMIUM: the level annual premium above which sales expense charges are
reduced.
UNDERLYING FUND: an open-ended management investment company, or a portfolio
thereof, to which values may be directed under the Separate Account. Shown on
the Policy Summary.
UNDERWRITING PERIOD: the time from when We receive a completed application until
the Issue Date of the policy.
VALUATION DATE: a day on which policy values are determined. This is any day on
which the New York Stock Exchange is open for trading and we are open for
business.
VALUATION PERIOD: the period between successive valuations.
VARIABLE ACCOUNT: one or more Variable Accounts are named on the Policy Summary,
each of which is a Separate Account.
WE, US, OUR: The Travelers Insurance Company.
YOU, YOUR: the owner(s) of this policy.
BENEFITS--BASIC POLICY
DEATH BENEFIT
Upon receipt at Our Office of Due Proof of the Insured's Death while the policy
is in force, we will pay to the Beneficiary the Death Benefit of the policy. The
Death Benefit will be the Amount Insured at the time of death, less any:
1. Indebtedness; and
2. amount payable to an assignee under a collateral assignment of the
policy; and
3. monthly Deduction Amount due but not paid.
The Death Benefit may be limited as provided under the Misstatement, Contest and
Suicide provisions on Page 10 and 11 of this policy. The Death Benefit depends
on the Death Benefit Option in effect at the date of death and any increase or
decrease you have made to the Initial Stated Amount. Benefits provided by any
rider attached to this policy will end according to the termination provision(s)
therein.
MATURITY BENEFIT
If the Insured is living on the Maturity Date, as shown on the Policy Summary,
we will pay you the Contract Value as of the Maturity Date, less any:
1. Indebtedness;
2. monthly Deduction Amount due but not paid; and
3. amount payable to an assignee under a collateral assignment of the
policy.
Upon maturity, insurance will end and we will have no other obligation under
this policy.
DEATH BENEFIT OPTIONS AND AMOUNT INSURED
There are two Death Benefit Options, which are as follows:
Under Option 1 (the Level Death Benefit Option), the Amount Insured is the
greater of the Stated Amount or any Minimum Amount Insured on the Insured's date
of death.
Under Option 2 (the Variable Death Benefit Option), the Amount Insured is the
greater of the Stated Amount plus the Contract Value, or any Minimum Amount
Insured on the Insured's date of death.
Page 5
REQUESTED CHANGES IN DEATH BENEFIT OPTIONS
At any time after the first Policy Year, you may change your Death Benefit
option under your policy from Option 1 to Option 2; or from Option 2 to Option
1. We will adjust the Stated Amount such that the Net Amount at Risk remains
constant. The effective date of the change will be the Monthly Deduction Day on
or following the date we approve the request for the change.
The remaining Amount Insured and the remaining Stated Amount in effect after any
change may not be less than the respective minimum amounts shown on the Policy
Summary.
REQUESTED CHANGES IN STATED AMOUNT
Increases -- At any time after the first Policy Year and prior to the earlier of
the Insured's attaining the Maximum Change Age or his/her death, you may request
an increase to the Stated Amount. The minimum amount of the increase is $5,000.
The request must be made In Writing to Our Office. The increase will be
effective on the date shown on the supplemental Policy Summary we will send you.
We will require evidence of insurability satisfactory to us if you request an
increase. We reserve the right to limit the number of increases to the Stated
Amount to one each policy year.
Decreases -- At any time after the first Policy Year, you may request a decrease
to the Stated Amount. The decrease will be effective on the later of the monthly
Deduction Day on or following our receipt of your request at Our Office, or the
monthly Deduction Day on or immediately following the date you request it to be
effective. We reserve the right to limit the number of decreases to the Stated
Amount to one each policy year.
The decrease will be applied as follows: first against the most recent increase
in the Stated Amount; then to other increases in the Stated Amount in the
reverse order in which they occurred; and last, to the Initial Stated Amount.
After any change, the Stated Amount in effect may not be less than the Minimum
Stated Amount shown on the Policy Summary or which would disqualify this policy
as a contract for life insurance. We will send you a supplemental Policy Summary
reflecting any change.
POLICY VALUES
CONTRACT VALUE
The Contract Value on the Policy Date is equal to the Net Premium. On each
Valuation Date, the Contract Value is equal to the sum of the accumulated values
in the Investment Options plus any Loan Account value. The accumulated value of
an Investment Option equals a times b where:
a is the number of Accumulation Units on the Valuation Date; and
b is the then current Accumulation Unit Value for that Investment
Option.
Policy values on other days are calculated in a manner consistent with this
method.
DEDUCTION AMOUNT
The first monthly Deduction Day is the Policy Date. The monthly Deduction Day is
shown on the Policy Summary.
The Deduction Amount will be charged monthly against each Investment Option in
proportion to the value of each Investment Option on each monthly Deduction Day.
The Deduction Amount is equal to:
1. the cost of insurance; plus
2. the charge(s) associated with any rider(s); plus
3. the monthly administrative charge shown on the Policy Summary; plus
4. the monthly case expense charge; plus
5. the cost of supplemental benefits, if any, for which a separate
charge is shown on the Policy Summary; plus
6. any other applicable charges shown on the Policy Summary.
The maximum guaranteed cost of insurance for any month is equal to C times the
result of a minus b where:
a is the Amount Insured for the month divided by the Death Benefit
Interest Factor shown on the Policy Summary;
b is the Contract Value on the monthly Deduction Day;
c is the cost shown in the Maximum Monthly Guaranteed Cost of
Insurance table on the Policy Summary at
Page 6
the Insured's age, divided by $1,000.
The maximum guaranteed cost of insurance rates shown on the Policy Summary are
based on the Insured's age, sex and rate class for the Initial Stated Amount and
each increase in the Stated Amount. We may use rates lower than those shown. We
will base any future changes in these rates only on our future expectations as
to investment earnings, mortality, expenses and persistency.
The monthly Deduction Amount for the following month will be taken out of the
Contract Value on the monthly Deduction Day shown on the Policy Summary. If the
Cash Surrender Value is not enough to pay the Deduction Amount due and no
further premiums are paid, the Grace Period will go into effect (see Grace
Period, Page 10).
CASH SURRENDER VALUE
The Cash Surrender Value is equal to the Contract Value less any Indebtedness as
shown on the Policy Summary. It will not be less than the minimum Cash Surrender
Value required by the insurance laws of the state in which this policy is
delivered. A detailed statement of the method of calculating the Cash Surrender
Values has been filed with the insurance department of the state in which this
policy is delivered.
CASH SURRENDER
While the Insured is living and this policy is in force, you may request, In
Writing, a full or partial surrender. You may do so without the consent of any
Beneficiary, unless irrevocably named. We will calculate your Cash Surrender
Value as of the day we receive your request In Writing and will pay this amount
within seven days after such request.
If you request a full surrender, the policy will end on the effective date of
the surrender.
A partial surrender may be made at any time after the first Policy Year while
this policy is in force. We will not make a partial surrender to you for less
than the Minimum Partial Surrender Amount shown on the Policy Summary. The
amount of any partial cash surrender may not exceed the Cash Surrender Value. If
you request a partial surrender, the Contract Value will be reduced by the
amount surrendered. We will reduce the Stated Amount by the amount necessary to
prevent an increase in the Net Amount at Risk. The Death Benefit and Amount
Insured will also be reduced as a result of the Cash Surrender. The deduction
from the Contract Value will be made on a pro-rata basis against the Contract
Value of each Investment Option unless you request otherwise In Writing. After
the reduction, the Amount Insured must be no less than the Minimum Amount
Insured shown on the Policy Summary.
POLICY LOANS
We will make a loan to you with the policy as security if you assign this policy
to us while it is in force. The loan must be requested In Writing. The amount of
the loan and all existing Indebtedness may not be more than the maximum loan
value shown on the Policy Summary as of the loan date. The loan date is the date
we process the loan. We will not make a loan to You or increase an outstanding
loan for less than the Minimum Loan Amount shown on the Policy Summary.
The loan interest rate is shown on the Policy Summary. Interest is charged daily
and is payable at the end of each Policy Year. Unpaid interest will be added to
existing Indebtedness as of the due date and will be charged interest at the
same rate as the rest of the loan.
When you take a loan, we will transfer an amount equal to the Policy Loan from
the Investment Options to the Loan Account in proportion to the Contract Value
in each Investment Option as of the loan date. Any loan interest that becomes
due and unpaid will also be transferred. The Loan Account will be maintained
while a loan is outstanding and will be credited interest at a rate at least
equal to the Annual Interest Rate Credited to Loan Accounts as shown on the
Policy Summary.
While the Insured is living and the policy is still in effect, all or part of
any loan may be repaid. Payment received while there is an outstanding loan on
the policy will be applied as follows: first towards repayment of any loan
interest due; next toward repayment of the loan principal; and last as a premium
payment to the policy. When you repay part or all of the loan, we will transfer
an amount equal to the amount you repay from the Loan Account to the Investment
Options. Loan repayments will be allocated among the Investment Options using
the Fund allocation factors in effect on the date of the repayment.
The Grace Period provision will go into effect if the Indebtedness exceeds the
Contract Value.
Page 7
PREMIUM AND VALUATION PROVISIONS
PREMIUM
An initial lump sum premium payment must be made to the policy and is due and
payable before the policy becomes effective. All premiums are payable at Our
Office or to one of our authorized representatives.
PREMIUM ALLOCATION
Net Premiums will be allocated among the Investment Options based upon the
allocation that you choose. Any allocation must be at least 5% and must be a
whole percentage, with the sum of the fund allocations equal to 100%.
Any subsequent Net Premiums will be allocated according to your most recently
chosen factors.
You may change the allocation for future Net Premiums at any time while your
policy is in force. To do so, you must notify us In Writing. The change will
take effect on the date we receive your written request.
ADDITIONAL PREMIUM PAYMENTS
You may make additional premium payments at any time while your policy is in
force. We reserve the right to require evidence of insurability before accepting
additional premium payments which result in an increased net amount at risk.
We will return any additional premium payments made which would exceed the
limits prescribed by federal income tax laws or regulations which would prevent
the policy from qualifying as life insurance.
SEPARATE ACCOUNT OPTION VALUATION
ACCUMULATION UNITS
The number of Accumulation Units to be credited to each Investment Option once a
premium payment has been received by us will be determined by dividing the
premium applied to that Investment Option by the current Accumulation Unit Value
of that Investment Option.
ACCUMULATION UNIT VALUE
The value of an Accumulation Unit for each Investment Option was initially set
at $1.00. We will determine the Accumulation Unit value for each Investment
Option on each Valuation Date by multiplying the value on the immediately
preceding Valuation Date by the corresponding net investment factor (see Net
Investment Factor provision) for that Investment Option for the Valuation Period
just ended.
The value of an Accumulation Unit on any date other than a Valuation Date will
be equal to its value as of the next Valuation Date.
NET INVESTMENT FACTOR
The net investment factor is a factor applied to measure the investment
performance of an Underlying Fund from one Valuation Period to the next. The net
investment factor for an Investment Option for any Valuation Period is
determined by dividing a by b and subtracting c where:
a is
1. the net asset value per share of the Underlying Fund as of the
Valuation Date; plus
2. the per-share amount of any dividend or capital gain distributions
by the Underlying Fund if the ex-dividend date occurs in the
Valuation Period just ended; plus or minus
3. a per-share charge or credit, as we may determine on the Valuation
Date for tax reserves; and
b is
1. the net asset value per share of the Underlying Fund as of the last
prior Valuation Date; plus or minus
2. the per-share or per-unit charge or credit for tax reserves as of
the end of the last prior Valuation Date; and
c is the applicable Investment Option deduction for the Valuation
Period.
Assets in each Investment Option will be valued at fair market value in
accordance with accepted accounting practices and applicable laws and
regulations.
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TRANSFERS BETWEEN INVESTMENT OPTIONS
As long as this policy is in effect, you may request that we transfer all or a
part of the Contract Value (minus Indebtedness) from an Investment Option to any
other Investment Option available under this policy at the time of request. Such
transfers must be in accordance with our rules. We reserve the right to limit
the number of free transfers between Investment Options as shown on the Policy
Summary. We reserve the right to charge the reasonable administrative fee
specified on the Policy Summary for transfers beyond that number. We also
reserve the right to restrict transfers requested by any market timing firm or
by any other third party who is authorized to initiate transfers on behalf of
multiple policy owners. We reserve the right not to accept: 1) the transfer
instructions of any agent acting under a power of attorney on behalf of more
than one owner, and 2) the transfer instructions of individual owners who have
executed pre-authorized transfer forms that are submitted by market timing firms
or by other third parties on behalf of more than one owner. We further reserve
the right to limit transfers that We determine will disadvantage other policy
owners.
Transfers between Investment Options will result in the addition or deletion of
Accumulation Units having a total value equal to the dollar amount being
transferred to or from a particular Investment Option. The number of
Accumulation Units will be determined by dividing the amount transferred by the
Accumulation Unit Value of the Investment Options involved as of the next
Valuation Date after we receive your request for transfer at Our Office.
CONTINUATION OF INSURANCE, GRACE PERIOD AND REINSTATEMENT
CONTINUATION OF INSURANCE
Subject to the Grace Period provision below, if sufficient premium payments are
not made, this policy will continue until the day on which the Cash Surrender
Value would not be enough to pay the monthly Deduction Amount due, or until the
Maturity Date, if earlier. The Continuation of Insurance benefit will not be
less than the minimum benefit required by the insurance laws of the state in
which this policy is delivered.
GRACE PERIOD
Thirty days after the Cash Surrender Value is insufficient to pay the Deduction
Amount due, we will send you a notice of required premium to your last known
address. If the required premium is not paid within 31 days after the notice is
sent, the policy will lapse. The policy will have no Contract Value. The policy
will continue through the Grace Period, but if the required payment has not been
received at Our Office, the policy will terminate at the end of the Grace
Period. If the Insured dies during the Grace Period, the Death Benefit payable
will be reduced by any Deduction Amount due but not paid and by any
Indebtedness.
REINSTATEMENT
This policy may be reinstated at any time within three years from the date to
which the monthly Deduction Amount had been paid, if:
1. the policy was not surrendered for cash; and
2. evidence of insurability acceptable to us is furnished; and
3. all monthly Deduction Amounts past due are paid; and
4. premium at least equal to the following three monthly Deduction
Amounts is paid; and
5. all Indebtedness is repaid or restored.
Upon reinstatement, the Contract Value of the policy prior to applying any
premiums or loan repayments will be the Contract Value at the end of the Grace
Period.
The effective date of the reinstated policy will be the Deduction Date on or
next following the date the application for reinstatement is approved by us.
Unless you have specified otherwise, all amounts will be allocated based on the
Fund allocation factors in effect at the start of the Grace Period.
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OWNERSHIP RIGHTS
OWNERSHIP
The original owner(s) is (are) shown on the application(s). During the Insured's
lifetime, you may, without the consent of any Beneficiary unless irrevocably
named, exercise all rights and options that this policy provides and that we
permit.
Ownership is transferable by assignment. No assignment is binding on us until we
receive a copy of the assignment In Writing. We will not determine if an
assignment is valid. Proof of interest must be filed with any claim under a
collateral assignment.
BENEFICIARY
The original Beneficiary is stated in the application. Unless the Beneficiary is
irrevocably named, you may name a new Beneficiary during the Insured's lifetime
and while this policy is in force by notifying us In Writing. Any change will be
effective from the date you signed the notice of change, even if the Insured is
not living when we receive the notice. We will have no further responsibility
for any payment we made before we received the notice at Our Office.
If no Beneficiary survives the Insured, you will be the Beneficiary. If you are
the Insured, your estate will be the Beneficiary. The rights of any collateral
assignee may affect the interest of the Beneficiary.
GENERAL PROVISIONS
ENTIRE CONTRACT
The entire contract consists of this policy and the application, a copy of which
is attached. The policy is issued in consideration of the application and the
payment of premium. We will not use any statement to void this policy or to deny
a claim under it, unless that statement is contained in an attached written
application. All statements in the application will be considered as being made
to the best knowledge and belief of the applicant and not as promises of truth.
CHANGES
This policy may only be altered by a written agreement signed by one of our
officers.
NO DIVIDENDS
This policy is non-participating. It does not share in our surplus earnings, so
you will receive no dividends under it.
MISSTATEMENT
If the age and/or sex of the Insured was incorrectly stated in the application,
all benefits will be adjusted to the amount which the premiums paid would have
purchased at the correct age and/or sex, based on the most recent cost of
insurance charge.
Proof of age may be filed at any time at Our Office.
SUICIDE
If, within two years from the Issue Date, the Insured dies due to suicide, while
sane or insane, the Death Benefit will be limited to the premiums paid, less any
Indebtedness and amount of any partial surrenders.
If you have applied for an increase to the Stated Amount, this Suicide provision
will be measured from the effective date of the increase with respect to payment
of the increase amount.
If this policy is reinstated, this Suicide provision will be measured from the
reinstatement date.
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CONTEST
No misstatements made in any application for this policy will be used to contest
payment of any Death Benefit after the policy has been in force during the
Insured's lifetime for two years from the Issue Date.
If you have applied for an increase to the Stated Amount, this Contest provision
will be measured from the effective date of the increase with respect to payment
of the increase amount. If this policy is reinstated, this Contest provision
will be measured from the reinstatement date.
SEPARATE ACCOUNT
We have exclusive and absolute ownership and control of the assets of the
Separate Account and its Investment Options. The assets of the Separate Account
will be available to cover the liabilities of our general account only to the
extent that those assets exceed the reserves and other policy liabilities of the
Separate Account arising under the variable life insurance policies supported by
the Separate Account. The assets of the Separate Account will be valued on each
Valuation Date. Our determination of the value of an Accumulation Unit by the
method described in the policy will be conclusive. To the extent required by
law, the investment policy of the Separate Account will not be changed without
the approval of the Insurance Commissioner of Connecticut. This approval process
is on file with the Commissioner of the state where this policy is issued for
delivery.
SUBSTITUTION OF SEPARATE ACCOUNT OR INVESTMENT OPTION
If the use of a Separate Account or Investment Option is no longer possible, or
in our judgment becomes inappropriate for the purposes of this policy, we may
substitute another Separate Account or Investment Option without your consent.
Substitution may be made with respect to both existing premium payments and
investment of future premium payments. However, no such substitution will be
made without notice to you and without prior approval of the Securities and
Exchange Commission and the approval of the Insurance Commissioner of the state
where this policy is issued for delivery, to the extent required by law. We may
also add other Investment Options under the policy.
EMERGENCY PROCEDURE
We reserve the right to suspend or postpone the date of any payment of any
benefit or values (including the payments of cash surrenders and policy loans)
(1) when the New York Stock Exchange is closed (except for holidays or
weekends); (2) when trading on the Exchange is restricted; (3) when an emergency
exists as determined by the Securities and Exchange Commission so that disposal
of the securities held in the Separate Account is not reasonably practicable or
it is not reasonably practicable to determine the value of the Separate
Account's net assets; or (4) when the Securities and Exchange Commission has
ordered that the right of surrender be suspended for your protection; or (5)
during any other period when the Securities and Exchange Commission, by order,
so permits for your protection. Any provision of this policy which specifies a
Valuation Date or provides for surrenders or loans will be superseded by this
Emergency Procedure.
VOTING RIGHTS
You, or the Beneficiary after the Insured's death, will be entitled to certain
voting rights with respect to the Investment Options to which you have allocated
premiums.
If current law requires, you will be entitled to instruct us how to vote at
meetings of the shareholders of the Investment Options. We will determine the
number of votes to which you will be entitled to instruct us. If there is a
change in the law which permits us to vote the shares of the Investment Options
without direction from you, we reserve the right to do so.
MATURITY OF AN INVESTMENT OPTION
If any Contract Value is attributable to an Investment Option having a specified
maturity date, the Contract Value in that Investment Option as of such maturity
date will be allocated to the money market Investment Option specified on the
Policy Summary, unless you request otherwise. We will send written notice to
your last known address at least thirty days in advance of the maturity date of
that Investment Option. To select an allocation to an Investment Option other
than the money market Investment Option, we must receive your notification In
Writing at least seven days before the maturity date of that Investment Option.
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ANNUAL STATEMENT
As often as required by law, but at least once in each Policy Year, we will send
you a statement showing:
1. the Contract Value, Stated Amount and Amount Insured; and
2. the premiums paid, deductions, surrenders and loans made during the
preceding Policy Year; and
3. total Loan Account value.
ILLUSTRATIVE REPORTS
You may request an up-to-date illustrative report of values based on past
results and current assumptions.
+++++++++
We will provide the illustrative report within a reasonable time. We may charge
a reasonable service fee, not to exceed $15 (unless prohibited by state law).
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