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EXHIBIT (5)(b)
SUPPLEMENTAL TERM INSURANCE RIDER
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We, National Life Insurance Company, will pay the Supplemental Term
Insurance Amount, subject to the terms of this rider, in addition to the
Death Benefit of this policy, when we receive at our Home Office due
proof that the Insured died while this rider was in force.
The date of issue of this rider is the policy Date of Issue unless a
later date is set forth below.
SUPPLEMENTAL TERM
INSURANCE AMOUNT
Under Option A, the Supplemental Term Insurance Amount shall be the Term
Insurance Amount stated in the Policy Schedule A less any excess of the
policy Death Benefit Standard over:
1. the policy Face Amount on the date of the Insured's death; less
2. the amount of any Monthly Deductions then due; less
3. any debt to us on this policy;
but not less than zero.
Under Option B, the Supplemental Term Insurance Amount shall be the Term
Insurance Amount stated in the Policy Schedule A less any excess of the
policy Death Benefit Standard over:
1. the policy Face Amount on the date of the Insured's death; plus
2. the Account Value of the policy on the date of the Insured's
death; less
3. the amount of any Monthly Deductions then due; less
4. any debt to us on this policy;
but not less than zero.
Option B will not be available if the Death Benefit Compliance Test is
The Cash Value Accumulation Test.
We will pay the Supplemental Term Insurance Amount to the Beneficiary
when we receive at our Home Office due proof that the Insured died while
this rider was in force. We will pay the Supplemental Term Insurance
Amount in one sum unless a Payment Option, as described in the policy to
which this rider is attached, is chosen. If the Supplemental Term
Insurance Amount is paid in one sum, it shall be increased by interest
from the date of the Insured's death to the date of payment. We will set
the rate of interest at not less than the Basis of Computations Interest
Rate shown in the Policy Schedule.
National Life Insurance Company
One National Life Drive * Montpelier, Vermont * (802) 229-3333
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SUICIDE LIMITATION
If the Insured dies within two years of the date of issue of this rider
as the result of suicide while sane or insane, we will pay only the sum
set forth in the Suicide Limitation provision of the policy. Payment will
be made to the Beneficiary.
COST OF SUPPLEMENTAL
TERM INSURANCE
AMOUNT
The Cost of Supplemental Term Insurance Amount rate on any day shall be
based on the Insured's then Attained Age, sex (if applicable) and the
rate class of the Term Insurance Amount on the date of issue of this
rider.
On any Monthly Policy Date, the Cost of Supplemental Term Insurance
Amount shall be the product of:
1. the Cost of Supplemental Term Insurance Amount rate on such
date divided by $1,000; multiplied by
2. the Supplemental Term Insurance Amount on such date, divided by
the sum 1.00 plus the monthly Basis of Computations Interest
Rate shown in Policy Schedule A.
We may change the Cost of Supplemental Term Insurance Amount rates from
time to time based on our expectations of future experience. Any change
in the Cost of Supplemental Term Insurance Amount rates shall apply to
all riders of the same size and duration, insuring persons of the same
Attained Age and rate class as the Insured. The Cost of Supplemental Term
Insurance Amount rates shall not be greater than the rates set forth in
the table of Guaranteed Maximum Cost of Insurance Rates shown in Policy
Schedule E. These rates are based on the Mortality Table named in Policy
Schedule A.
SUPPLEMENTAL TERM
INSURANCE AMOUNT
DECREASES
The Owner may request that the Supplemental Term Insurance Amount be
decreased. A decrease may only be made during the lifetime of the
Insured. We will send the Owner a revised Policy Schedule if a decrease
is made.
We will require a written request from the Owner. A decrease in the
Supplemental Term Insurance Amount shall be effective on the Monthly
Policy Date on or next following our receipt of the request.
Decreases will not be permitted which would reduce the sum of the Face
Amount plus the amounts insured in force under this policy to less than
any of the following:
1. the minimum coverage amount for which the policy would qualify
as "Life Insurance" for Federal Income Tax purposes under the
Internal Revenue Code; or
2. the Minimum Face Amount shown in the Policy Schedule.
National Life Insurance Company
One National Life Drive * Montpelier, Vermont * (802) 229-3333
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A decrease in total insurance coverage shall apply in the following
order:
1. first, to any increases in Face Amount or to the addition of
any Supplemental Term Insurance Riders providing coverage on
the life of the Insured in the reverse order in which they were
made;
2. second, to the Face Amount on the Date of Issue.
If both an increase in Face Amount and the addition of a Supplemental
Term Insurance Rider providing coverage on the life of the Insured became
effective on the same date, a decrease in total coverage made effective
on that date shall apply in the following order:
1. first, to any increase in total insurance coverage resulting
from the addition of an Supplemental Term Insurance Rider
providing coverage on the life of the Insured;
2. second, to any increase in Face Amount;
3. third, to the Face Amount on the Date of Issue.
INCONTESTABILITY
After this rider has been in force during the life of the Insured for two
years from its date of issue, we will not contest it.
MISSTATEMENT OF AGE OR SEX
If it is found that the amount of any benefit provided by this rider is
incorrect because of misstatement as to the age or sex (if applicable) of
the Insured, the amount of the benefit will be equitably adjusted on the
basis of the correct facts.
CONSIDERATION
This rider is issued in consideration of the application for the rider
and the monthly cost of the rider. The rider and a copy of the
application for the rider shall become part of the policy on the date of
issue of the rider.
TERMINATION
This rider shall terminate on the earliest of:
1. the date the policy terminates; or
2. any Monthly Policy Date requested, if before that date we
receive at our Home Office written request for termination.
When this rider terminates:
1. all rights under this rider shall cease; and
2. there shall be no further monthly costs for this rider; and
3. the policy shall be considered as separate and complete without
this rider.
National Life Insurance Company
One National Life Drive * Montpelier, Vermont * (802) 229-3333
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REINSTATEMENT
If the policy to which this rider is attached is reinstated, this
rider will be reinstated according to the same terms.
Signed for National Life Insurance Company at Montpelier, Vermont, as of the
date of issue of this rider, by
[SIG]
Chairman of the Board
and
Chief Executive Officer
National Life Insurance Company
One National Life Drive * Montpelier, Vermont * (802) 229-3333
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