1
EXHIBIT 99.A(5)
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LIFE INSURED JOHN M. DOE
POLICY NUMBER 12 345 678
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MODIFIED SINGLE PREMIUM VARIABLE LIFE INSURANCE.
BENEFIT PAYABLE ON THE EARLIER OF THE LIFE INSURED'S DEATH OR THE MATURITY DATE.
POLICY VALUES ALLOCATED TO AN INVESTMENT ACCOUNT REFLECT THE INVESTMENT
EXPERIENCE OF THE UNDERLYING SUB-ACCOUNTS. INVESTMENT OPTIONS ARE DESCRIBED IN
THE "POLICY VALUE COMPOSITION" AND THE "INVESTMENT OPTIONS" PROVISIONS.
NON-PARTICIPATING (NOT ELIGIBLE FOR DIVIDENDS).
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In this policy "you" and "your" refer to the owner of the policy. "We", "us" and
"our" refer to The Manufacturers Life Insurance Company of New York.
If the Life Insured is living and the policy is in force on the Maturity Date,
we will pay you the Policy Value less any outstanding Policy Debt.
If the Life Insured dies while the policy is in force, we will pay the Insurance
Benefit to the beneficiary, subject to the provisions of the policy. The Life
Insured and the beneficiary are named on page 3 and in the application for this
policy, a copy of which is attached to this policy. If more than one Life Isured
is named, the Insurance Benefit is payable on the death of the last survivor.
THIS POLICY IS DESIGNED TO PERMIT A LARGE INITIAL PREMIUM AND, SUBJECT TO
CERTAIN CONDITIONS, ADDITIONAL PREMIUMS. YOU MAY ALLOCATE YOUR PREMIUMS TO ONE
OR MORE OF THE AVAILABLE INVESTMENT ACCOUNTS AND/OR THE FIXED ACCOUNT.
THE PORTION OF YOUR POLICY VALUE THAT IS IN AN INVESTMENT ACCOUNT WILL VARY FROM
DAY TO DAY. THE AMOUNT IS NOT GUARANTEED; IT MAY INCREASE OR DECREASE, DEPENDING
ON THE INVESTMENT EXPERIENCE OF THE UNDERLYING SUB-ACCOUNTS FOR THE INVESTMENT
ACCOUNTS THAT YOU HAVE CHOSEN.
THE PORTION OF YOUR POLICY VALUE THAT IS IN THE FIXED ACCOUNT WILL ACCUMULATE,
AFTER DEDUCTIONS, AT RATES OF INTEREST WE DETERMINE. SUCH RATES WILL NOT BE LESS
THAN THE EFFECTIVE ANNUAL FIXED ACCOUNT RATE SHOWN ON PAGE 3.2.
READ YOUR POLICY CAREFULLY. IT IS A CONTRACT BETWEEN YOU AND US.
RIGHT TO RETURN POLICY. WITHIN EITHER (1) TEN DAYS AFTER RECEIVING YOUR POLICY
IF IT DOES NOT REPLACE ANOTHER POLICY; OR (2) SIXTY DAYS IF IT REPLACES AN
EXISTING POLICY, YOU CAN RETURN THE POLICY FOR CANCELLATION BY DELIVERING OR
MAILING IT TO US OR THE AGENT WHO SOLD IT. IMMEDIATELY UPON DELIVERY OR MAILING,
THE POLICY WILL BE VOID FROM THE BEGINNING. WE WILL REFUND IN FULL THE PREMIUM
PAID.
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MANULIFE FINANCIAL
THE MANUFACTURERS LIFE INSURANCE
COMPANY OF NEW YORK
Home Office: 100 Summit Lake Drive, 2nd Floor, Valhalla, NY 10595
/s/ James W. Gallagher /s/ Tracy A. Kane
President Secretary
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2
TABLE OF CONTENTS
PAGE
Policy Information ................................ 3
Table Of Guaranteed Maximum Cost Of Insurance Rates 4
Definitions ....................................... 5
Premium Payments .................................. 6
Policy Termination ................................ 7
Reinstatement ..................................... 7
Maturity Benefit .................................. 8
Insurance Benefit ................................. 8
Policy Value ...................................... 8
Policy Value Composition .......................... 9
Separate Account And Sub-Accounts ................. 10
Investment Options ................................ 11
Policy Loan Conditions ............................ 12
Surrender And Withdrawals ......................... 14
Right To Postpone Payment Of Benefits ............. 15
Suicide ........................................... 15
Beneficiary ....................................... 15
Ownership And Assignment .......................... 16
Protection Against Creditors ...................... 16
Currency And Place Of Payment ..................... 16
Contract .......................................... 17
Validity .......................................... 17
Non-Participating ................................. 17
Age And Sex ....................................... 17
Conversion Privilege .............................. 17
Flexible Factors .................................. 18
How Values Are Computed ........................... 18
Annual Statement .................................. 18
Tax Considerations ................................ 18
Any endorsements, any supplementary benefits, and a copy of the application,
follow page 18.
Page 2
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POLICY INFORMATION
LIFE INSURED JOHN M. DOE AGE AT POLICY DATE: 35
POLICY NUMBER 12 345 678 POLICY DATE: SEP 1, 1999
ISSUE DATE: SEP 1, 1999
MATURITY DATE: SEP 1, 2064
OWNER JOHN M. DOE
BENEFICIARY AS DESIGNATED IN THE APPLICATION OR SUBSEQUENTLY CHANGED
PLAN MODIFIED SINGLE PREMIUM VARIABLE LIFE INSURANCE
NON-PARTICIPATING
LAPSE PROTECTION BENEFIT PERIOD: 30 POLICY YEARS
FACE AMOUNT $177,708.69
INITIAL PREMIUM $25,000.00
SEX MALE
RISK
CLASSIFICATION NON-SMOKER, STANDARD CLASS
ADDITIONAL
RATING NOT APPLICABLE
Life insurance coverage under this policy may expire prior to the maturity date
if premium and investment experience are insufficient to continue coverage to
such date.
Keeping the policy and coverage in force will be affected by factors such as:
changes in the current cost of insurance rates; the amount, timing and frequency
of premium payments; the interest rate being credited to the Fixed Account; the
investment experience of the Sub-Accounts; loan activity; and partial
withdrawals. Also refer to the "Policy Termination" provision of your policy.
Subject to the guarantees of this policy, we reserve the right to change the
current Cost Of Insurance Rate Deductions and the current Interest Rate being
credited to the Fixed Account. These changes may require more premium to be paid
or cause the cash value to be less than illustrated.
(Single Life)
PAGE 3.0
4
POLICY INFORMATION (CONTINUED) - POLICY 12 345 678
TABLE OF CHARGES
Unless otherwise specified, charges are based on and deducted proportionately
from the Fixed Account Value and the Investment Account Value.
TAX LOAD:
0.030% MONTHLY FOR 10 YEARS AFTER THE DATE OF EACH PREMIUM PAYMENT. THE TAX
LOAD FOR ADDITIONAL PREMIUMS IS BASED ON THE PROPORTION OF THE POLICY VALUE
ASSOCIATED WITH THE PREMIUM.
ADMINISTRATION CHARGE:
A FLAT MONTHLY CHARGE OF $7.50, PLUS 0.010% MONTHLY.
MORTALITY AND EXPENSE RISKS CHARGE:
0.075% DEDUCTED MONTHLY FROM EACH INVESTMENT ACCOUNT VALUE FOR THE FIRST 10
POLICY YEARS, REDUCING TO 0.025% THEREAFTER.
COST OF INSURANCE CHARGE:
SEE THE MONTHLY DEDUCTIONS SECTION OF THE POLICY VALUE PROVISION FOR
DETAILS ON HOW THE COST OF INSURANCE CHARGE IS DETERMINED.
PAGE 3.1A
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POLICY INFORMATION (CONTINUED) - POLICY 12 345 678
TABLE OF CHARGES (CONTINUED)
SURRENDER CHARGE:
A SURRENDER CHARGE WILL BE DEDUCTED FROM YOUR POLICY VALUE UNDER CERTAIN
CONDITIONS. SEE THE FOLLOWING PROVISIONS FOR DETAILS: POLICY VALUE AND SURRENDER
AND WITHDRAWALS.
AS SHOWN BELOW, THE SURRENDER CHARGE IS A PERCENTAGE OF THE POLICY VALUE BEING
WITHDRAWN OR SURRENDERED IN EXCESS OF THE FREE WITHDRAWAL AMOUNT.
SURRENDER SURRENDER CHARGE
CHARGE PERIOD PERCENTAGE
------------------------------------------
1 10.00%
2 9.00%
3 8.00%
4 7.00%
5 6.00%
6 5.00%
7 4.00%
8 3.00%
9 1.50%
10 0.00%
Percentage shown is at beginning of policy year. For other policy
months the percentage can be found by reducing the above percentages
proportionately.
MAXIMUM SURRENDER CHARGE:
IF NECESSARY, THE SURRENDER CHARGE DETERMINED ABOVE WILL BE REDUCED SUCH THAT
THE SUM OF (A) AND (B) DOES NOT EXCEED (C) WHERE:
(A) IS THE CUMULATIVE PREMIUM LOAD AND ADMINISTRATIVE CHARGE DEDUCTED UNDER THE
POLICY;
(B) IS THE SURRENDER CHARGE DETERMINED BY THE ABOVE TABLE; AND
(C) IS 10% OF PREMIUMS RECEIVED IN THE FIRST POLICY YEAR.
PAGE 3.1B
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POLICY INFORMATION (CONTINUED) - POLICY 12 345 678
TABLE OF VALUES
Refer to your policy provisions for details on the terms and values shown
in this table.
GUIDELINE SINGLE PREMIUM $25,000.00
GUIDELINE LEVEL PREMIUM $2,134.44
MINIMUM INITIAL PREMIUM $25,000.00
MINIMUM WITHDRAWAL AMOUNT $500.00
TRANSFER FEE $25.00
(FOR TRANSFERS IN EXCESS OF 12 IN A POLICY YEAR)
MAXIMUM ASSET ALLOCATION BALANCER CHARGE $15.00
MAXIMUM DOLLAR COST AVERAGING CHARGE $5.00
FIXED ACCOUNT MAXIMUM TRANSFER PERCENTAGE 15%
FIXED ACCOUNT MAXIMUM TRANSFER AMOUNT $500.00
MINIMUM GUARANTEED ANNUAL FIXED ACCOUNT RATE 4.00%
LOAN INTEREST CHARGED RATE (ALL LOANS) 6.00%
LOAN ACCOUNT CREDITED RATE
PREFERRED LOANS 6.00%
OTHER LOANS 4.00%
MAXIMUM LOAN INTEREST CREDITED DIFFERENTIAL (OTHER LOANS) 2.00%
DEATH BENEFIT DISCOUNT FACTOR 1.0032737
PAGE 3.2
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POLICY INFORMATION (CONTINUED) - POLICY 12 345 678
TABLE OF MINIMUM DEATH BENEFIT PERCENTAGES
ATTAINED AGE APPLICABLE PERCENTAGE
--------------------------------------------
40 and under 250%
45 215%
50 185%
55 150%
60 130%
65 120%
70 115%
75 105%
90 105%
95 and above 100%
For ages not shown, the Applicable Percentage can be found by reducing the above
Applicable Percentages proportionately.
PAGE 3.3
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TABLE OF GUARANTEED MAXIMUM COST OF INSURANCE RATES
GUARANTEED MAXIMUM MONTHLY RATES PER $1,000
OF NET AMOUNT AT RISK
MALE, NON-SMOKER
LIFE LIFE LIFE
INSURED'S INSURED'S INSURED'S
ATTAINED MONTHLY ATTAINED MONTHLY ATTAINED MONTHLY
AGE RATE AGE RATE AGE RATE
$ $ $
20 0.1400 47 0.3233 74 4.4100
21 0.1391 48 0.3491 75 4.9000
22 0.1366 49 0.3783 76 5.4216
23 0.1341 50 0.4091 77 5.9700
24 0.1308 51 0.4458 78 6.5391
25 0.1266 52 0.4883 79 7.1433
26 0.1233 53 0.5358 80 7.8058
27 0.1216 54 0.5908 81 8.5433
28 0.1200 55 0.6516 82 9.3766
29 0.1200 56 0.7191 83 10.3158
30 0.1200 57 0.7908 84 11.3425
31 0.1225 58 0.8683 85 12.4333
32 0.1250 59 0.9558 86 13.5666
33 0.1291 60 1.0533 87 14.7325
34 0.1341 61 1.1616 88 15.9075
35 0.1408 62 1.2850 89 17.1075
36 0.1475 63 1.4258 90 18.3491
37 0.1566 64 1.5850 91 19.6533
38 0.1666 65 1.7608 92 21.0625
39 0.1783 66 1.9500 93 22.6358
40 0.1908 67 2.1550 94 24.6375
41 0.2058 68 2.3750 95 27.4966
42 0.2208 69 2.6150 96 32.0458
43 0.2383 70 2.8858 97 40.0166
44 0.2558 71 3.2425 98 54.8316
45 0.2766 72 3.5466 99 83.3333
46 0.2991 73 3.9533
The above rates will be adjusted for any Additional Rating shown in the Policy
Information section.
Page 4
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DEFINITIONS
THE FOLLOWING TERMS HAVE SPECIFIC MEANINGS IN YOUR POLICY. PLEASE REFER TO THESE
DEFINITIONS AS YOU READ YOUR POLICY.
ADDITIONAL RATING is an increase in the Cost of Insurance Rate that is applied
when a Life Insured does not meet, at a minimum, our underwriting requirements
for the standard Risk Classification.
AGE at a specific date means age on the nearest birthday. If no specific date is
mentioned, age means the Life Insured's age on the Policy Anniversary nearest to
the birthday.
ATTAINED AGE on any date means the Age plus the number of whole years that have
elapsed since the Policy Date.
BUSINESS DAY is any day that the New York Stock Exchange is open for business.
The net asset value of the underlying shares of a Sub-Account will be determined
as of the end of each Business Day. A Business Day ends at the close of
regularly scheduled day-time trading of the New York Stock Exchange on that day.
CASH SURRENDER VALUE equals the Policy Value reduced by any Surrender Charge and
any outstanding Monthly Deductions due.
CODE means the Internal Revenue Code of 1986 (as amended).
EARNINGS is an amount calculated in relation to a loan, partial Net Cash
Surrender Value Withdrawal or surrender of the policy. It is equal to (a) minus
the sum of (b) and (c), each calculated as of the date we receive your Written
Request, where:
(a) is the Policy Value;
(b) is the value of any Policy Debt; and
(c) is total premiums paid.
FIXED ACCOUNT is that part of the Policy Value which reflects the value you have
in our general account.
FREE WITHDRAWAL AMOUNT is, at any date, the greater of (a) and (b), where:
(a) is 100% of Earnings; and
(b) is 10% of total premiums paid.
INVESTMENT ACCOUNT is that part of the Policy Value that reflects the value you
have in one of the Sub-Accounts.
ISSUE DATE is the date shown in the Policy Information section from which the
Suicide and Validity provisions are applied.
LIFE INSURED is the person or persons whose life is covered by this policy as
specified in the Policy Information section.
LOAN ACCOUNT is that part of the Policy Value which reflects the value
transferred from the Fixed Account or the Investment Accounts as collateral for
a policy loan.
MATURITY DATE is the date shown in the Policy Information section. It is the
Policy Anniversary nearest Attained Age 100 of the Life Insured.
NET CASH SURRENDER VALUE is the Cash Surrender Value less the Policy Debt.
NET POLICY VALUE is the Policy Value less the value in the Loan Account.
POLICY DATE is the date coverage takes effect under the policy provided we
receive the full amount of the initial premium at our Service Office. The Policy
Date is shown in the Policy Information section. The amount of the first Monthly
Deduction is calculated from the Policy Date. The Policy Date is also used to
determine Policy Years, Policy Months and Policy Anniversaries.
(continued)
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DEFINITIONS (continued)
POLICY DEBT as of any date equals (a) plus (b) plus (c) minus (d), where:
(a) is the total amount of loans borrowed as of such date;
(b) is the total amount of any unpaid loan interest charges which have been
borrowed against the policy on a Policy Anniversary;
(c) is any interest charges accrued from the last Policy Anniversary to the
current date; and
(d) is the total amount of loan repayments as of such date.
POLICY VALUE is the sum of the values in the Loan Account, the Fixed Account and
the Investment Accounts.
SEPARATE ACCOUNT refers to Separate Account B of The Manufacturers Life
Insurance Company of New York.
SERVICE OFFICE is the office we designate to service this policy. The Service
Office Mailing Address is The Manufacturers Life Insurance Company of New York,
P.O. Box 633, Niagara Square Station, Buffalo, NY 14202-0633. The Home Office
Address is 100 Summit Lake Drive, 2nd Floor, Valhalla, NY 10595.
SUB-ACCOUNT refers to one of the sub-accounts of the Separate Account.
SURRENDER CHARGE PERIOD is the period following the Issue Date of the policy
during which we will assess surrender charges. Surrender charges will apply
during this period to amounts in excess of the Free Withdrawal Amount if you
surrender the policy or make a partial withdrawal, or if the policy terminates
due to default. The Surrender Charge Period is shown in the Policy Information
section.
WRITTEN REQUEST is your request to us which must be in a form satisfactory to
us, signed and dated by you, and filed at our Service Office.
PREMIUM PAYMENTS
Premiums are payable at our Service Office. On request, we will give you a
receipt signed by one of our officers.
INITIAL PREMIUM. No insurance will take effect under this policy before we
approve the application and receive the initial premium. The Minimum Initial
Premium is shown in the Policy Information section. The initial premium is used
to determine the Face Amount of insurance.
ADDITIONAL PREMIUMS. You may pay additional premiums subject to the following
conditions:
(a) we have the right to refuse or refund any premium payments that would
cause this policy to fail to qualify as life insurance under Section 7702
of the Code or any other equivalent section;
(b) we reserve the right to request that you provide us with satisfactory
evidence of insurability if a premium payment would result in an increase
in the Death Benefit that is greater than the increase in Policy Value;
and
(c) the sum of the premiums paid into this policy at any time may not exceed
the guideline premium limitation as of such time. The guideline premium
limitation is, as of any date, the greater of:
(1) the Guideline Single Premium, or
(2) the sum of the Guideline Level Premiums to such date.
The Guideline Single Premium and the Guideline Level Premium are shown in
the Policy Information section; and
(d) while there is an outstanding Policy Debt, any additional premium payment
will be applied first to repay the Policy Debt.
(continued)
Page 6
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PREMIUM PAYMENTS (continued)
ALLOCATION OF PREMIUM PAYMENTS. You may allocate premiums to any of the
Investment Accounts and/or the Fixed Account. Unless you change the initial
premium allocation specified in your application for this policy, it will
continue to apply to additional premium payments.
Allocation percentages must be zero or a whole number not greater than 100. The
sum of the allocation percentages must equal 100. You may change the allocation
percentages by Written Request to our Service Office. The change will take
effect as of the date we receive your request at our Service Office.
POLICY TERMINATION
DEFAULT. The policy will go into default if, at the beginning of any Policy
Month the Net Cash Surrender Value would go to zero or below after we take the
Monthly Deduction that is due for that month.
GRACE PERIOD. We will allow 61 days from the date that the policy goes into
default, for you to pay the amount that is required to bring the policy out of
default. At least 15 but not more than 45 days prior to the termination of
coverage, we will send a notice to your last known address, specifying the
amount you must pay to bring the policy out of default. If we have notice of a
policy assignment on file at our Service Office, we will also mail a copy of the
notice of the amount due to the assignee on record.
The amount required to bring the policy out of default is equal to (a) plus (b),
where:
(a) is the amount necessary to bring the Net Cash Surrender Value to zero, if
it is less than zero, at the date of default; and
(b) is the Monthly Deduction due on the date of default, plus an amount to
cover Monthly Deductions to the later of the next Policy Anniversary or at
least three Policy Months.
If the amount necessary to bring the policy out of default has not been paid by
the end of the grace period, the policy will terminate.
TERMINATION DATE. This policy terminates on the earliest of the following
events:
(a) the end of the grace period for which you have not paid the amount
necessary to bring the policy out of default;
(b) surrender of the policy for its Net Cash Surrender Value;
(c) the Maturity Date; or
(d) the death of the Life Insured.
REINSTATEMENT
You can ask us to reinstate your policy only if it terminates at the end of a
grace period in which you did not make a required payment.
You can reinstate the policy if you:
(a) make a Written Request for reinstatement within 5 years after the date
your policy terminates;
(b) provide us with evidence of insurability satisfactory to us on the Life
Insured; and
(c) pay a premium equal to the amount that was required to bring the policy
out of default immediately prior to termination, plus an amount to cover
Monthly Deductions to the later of the next Policy Anniversary or at least
three Policy Months.
(continued)
Page 7
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REINSTATEMENT (continued)
If we approve your request,
(a) the reinstatement date will be the later of the date we approve your
request or the date we receive the required payment at our Service Office;
and
(b) any remaining Surrender Charge Period will be reinstated to what it was at
the date of default.
(c) The Surrender Charge in effect on the date of reinstatement will be the
same as the Surrender Charge in effect on the date of default.
The Policy Value on the date of reinstatement, prior to the crediting of any Net
Premium paid on the reinstatement, will be equal to the Policy Value on the date
the policy terminated.
MATURITY BENEFIT
Provided the policy is in force and the Life Insured is alive on the Maturity
date, we will pay you the following amount calculated as of the Maturity Date:
(a) the Policy Value, less
(b) any outstanding Policy Debt.
INSURANCE BENEFIT
If the Life Insured dies prior to the Maturity Date, while the policy is in
force, we will pay the Insurance Benefit to the beneficiary on receiving due
proof of death, subject to the Age and Sex, Suicide and Validity provisions.
If the Life Insured dies after we receive a request from you to surrender the
policy, there will be no Insurance Benefit. We will pay the amount payable under
the Surrender And Withdrawals provision instead.
INSURANCE BENEFIT. The Insurance Benefit payable is:
(a) the Death Benefit as described below; less
(b) the value of the Policy Debt as of the date of death.
If the Life Insured dies during a grace period prior to the Maturity Date, the
Insurance Benefit will be reduced by any outstanding Monthly Deductions due.
DEATH BENEFIT. The Death Benefit is the greater of (a) and (b) where:
(a) is the Face Amount of the policy at the date of the Life Insured's death;
and
(b) is the Policy Value at the date of death, multiplied by the Applicable
Percentage in the Table of Minimum Death Benefit Percentages shown in the
Policy Information section.
POLICY VALUE
INITIAL PREMIUM. Based on your allocation instructions, we will allocate your
initial premium plus any earned interest on the later of the date our
underwriters approve issuance of the policy or the Business Day we receive the
initial premium at our Service Office. For premium received prior to the
underwriting decision we will credit interest as of the date we received the
initial premium payment at the rate of return then being earned on allocations
to the Money Market Trust. This initial allocation will become your Policy Value
to which additional premiums will be allocated.
ADDITIONAL PREMIUMS. We will add your premium to your Policy Value as of the
Business Day we receive an additional premium at our Service Office. However, if
evidence of insurability is required for an additional premium, we will add it
to your Policy Value as of the Business Day our underwriters approve the
evidence, but before we take any deductions due as of that Business Day.
(continued)
Page 8
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POLICY VALUE (continued)
MONTHLY DEDUCTIONS. Monthly Deductions are due until the Maturity Date. At the
beginning of each Policy Month, a deduction is taken from your policy to cover
the following expense charges:
(a) Tax Load, if applicable;
(b) Administration Charge;
(c) Mortality and Expense Risks Charge; and
(d) Cost of Insurance Charge.
The Cost of Insurance Charge is described below. The amount and duration of the
other charges are shown in the Table of Expense Charges in the Policy
Information section.
Unless specified otherwise in the Table of Expense Charges, we will take Monthly
Deductions from the Fixed Account and the Investment Accounts in the same
proportion that the Policy Value in each of these accounts bears to the Net
Policy Value immediately prior to the deduction. We will take the deductions
according to your instructions if we approve your request and you have
sufficient funds in the accounts.
COST OF INSURANCE CHARGE. The Cost of Insurance for a specific Policy Month is
determined as the rate for the Cost of Insurance for that month, as described
below, multiplied by the net amount at risk.
The net amount at risk is equal to (a) minus (b), where:
(a) is the Death Benefit as of the first day of the Policy Month, divided by
the Death Benefit Discount Factor shown in the Table of Values in the
Policy Information section; and
(b) is the Policy Value as of the first day of the Policy Month.
The rates for the Cost of Insurance are based on the Life Insured's Age, Sex,
Risk Classification and duration that the coverage has been in force. The Cost
of Insurance calculation will reflect any Additional Rating shown in the Policy
Information section.
We will re-determine Cost of Insurance rates from time to time on a basis that
does not discriminate unfairly within any class of Life Insured. The Cost of
Insurance rates will never exceed those shown on Page 4 in the Table of
Guaranteed Maximum Cost of Insurance Rates.
OTHER DEDUCTIONS. As stated in the Surrender and Withdrawal provision, we will
deduct a Surrender Charge if during the Surrender Charge Period you:
(a) surrender the policy, and the Net Cash Surrender Value is above the Free
Withdrawal Amount; or
(b) make partial withdrawals above the Free Withdrawal Amount.
POLICY VALUE COMPOSITION
Your Policy Value at any time is equal to the sum of the values you have in the
Loan Account, the Fixed Account and the Investment Accounts. LOAN ACCOUNT VALUE.
The amount you have in the Loan Account at any time equals: (a) amounts
transferred to it for loans or borrowed loan interest; plus (b) interest
credited to it; less (c) amounts transferred from it for loan repayment.
For the details of the Loan Account see the Policy Loan Conditions provision.
FIXED ACCOUNT VALUE. The amount you have in the Fixed Account at any time
equals:
(a) premiums allocated to it; plus
(b) amounts transferred to it; plus
(continued)
Page 9
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POLICY VALUE COMPOSITION (continued)
(c) interest credited to it; less
(d) amounts deducted from it; less
(e) amounts transferred from it; less
(f) amounts withdrawn from it.
Interest will be credited to amounts in the Fixed Account at an effective annual
rate of no less than the Minimum Guaranteed Annual Fixed Account Rate shown in
the Table of Values in the Policy Information Section. The actual interest rate
used will be set by us from time to time. For all transactions, interest is
calculated from the date of the transaction.
INVESTMENT ACCOUNT VALUE. The amount you have in an Investment Account at any
time equals the number of units in that Investment Account, multiplied by the
unit value of the corresponding Sub-Account at that time.
The number of units in an Investment Account at any time equals (a) minus (b),
where:
(a) is the number of units credited to the Investment Account because of:
(1) premiums allocated to it; and
(2) amounts transferred to it; and
(b) is the number of units canceled from the Investment Account because of:
(1) amounts deducted from it;
(2) amounts transferred from it; and
(3) amounts withdrawn from it.
The number of units credited or canceled for a given transaction is equal to the
dollar amount of the transaction, divided by the unit value as of the Business
Day of the transaction. See the Unit Value Calculation section of this provision
for details on how unit values are determined.
SEPARATE ACCOUNT AND SUB-ACCOUNTS
The Separate Account is authorized to invest in the shares of Manufacturers
Investment Trust, or another management investment company. Each Sub-Account of
the Separate Account purchases shares of a corresponding fund of Manufacturers
Investment Trust or another management investment company.
FUND SUBSTITUTION. An available fund might, in our judgment, become unsuitable
for investment by a Sub-Account. This might happen because of a change of
investment policy; or a change in the applicable laws or regulations; or because
the shares are no longer available for investment; or for some other reason.
If an available fund becomes unsuitable for investment, we have the right to
substitute another fund or another management investment company. Before doing
this, we would first seek, where required, approval from the Securities and
Exchange Commission and the Superintendent of Insurance of the State of New
York.
To the extent permitted by applicable federal and state law, we also have the
right, without your approval, to:
(a) create new separate accounts;
(b) combine any two or more separate accounts including the Separate Account;
(c) make available additional Sub-Accounts investing in additional funds of
Manufacturers Investment Trust, or another investment company;
(d) eliminate existing Sub-Accounts and stop accepting new allocations and
transfers into the corresponding fund;
(e) operate the Separate Account as a management investment company under the
Investment Company Act of 1940 or in any other form permitted by law;
(continued)
Page 10
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SEPARATE ACCOUNT AND SUB-ACCOUNTS (continued)
(f) de-register the Separate Account under the Investment Company Act of 1940;
(g) transfer assets between the Separate Account and other separate accounts;
and
(h) combine Sub-Accounts or to transfer assets in one Sub-Account to another
Sub-Account.
UNIT VALUE CALCULATION. We will determine the unit values for each Sub-Account
as of the end of each Business Day. When we need to determine a Policy Value or
an amount after the end of a Business Day, or on a day that is not a Business
Day, we will do so as of the next Business Day.
The value of a unit of each Sub-Account was initially fixed at $10 for the first
Business Day that an amount was allocated, or transferred to the particular
Sub-Account. For any subsequent Business Day, the unit value for that
Sub-Account is obtained by multiplying the unit value for the immediately
preceding Business Day by the net investment factor for the particular
Sub-Account on such subsequent Business Day.
NET INVESTMENT FACTOR. The net investment factor for a Sub-Account on any
Business Day is equal to (a) divided by (b), where:
(a) is the net asset value of the underlying fund shares held by that
Sub-Account as of the end of such Business Day before any policy
transactions are made on that day; and
(b) is the net asset value of the underlying fund shares held by that
Sub-Account as of the end of the immediately preceding Business Day after
all policy transactions were made for that day.
We reserve the right to adjust the above formula for any taxes determined by us
to be attributable to the operations of the Sub-Account. Before making any such
changes, we will first seek approval of the Superintendent of Insurance of the
State of New York.
SEPARATE ACCOUNT ASSETS. The assets held in each Sub-Account are used to support
variable life insurance policies.
Income, gains and losses of the Separate Account are credited to, or charged
against, the applicable Sub-Accounts without regard to our other income, gains
and losses.
The assets of the Separate Account are our property. The part of the assets that
is equal to the Investment Account values in respect of all Single Premium and
Flexible Premium Variable Life Insurance policies will not be charged with
liabilities from any other business we conduct. We can transfer to our general
account, Separate Account assets in excess of the liabilities of the Separate
Account arising under the Single Premium and Flexible Premium Variable Life
Insurance policies supported by the Separate Account.
INVESTMENT OPTIONS
TRANSFERS. By Written Request you may transfer portions of your Policy Value
among the Investment Accounts and the Fixed Account.
Transfers are subject to the following restrictions:
(a) you can make as many transfers in a Policy Year as you want. There is no
charge for the first twelve transfers in any Policy Year. If you make more
than twelve transfers in any Policy Year, the Transfer Fee shown in the
Table of Values in the Policy Information section will apply to each
subsequent transfer in that Policy Year. We will consider all transfer
requests received on the same Business Day as one transfer;
(b) you may transfer your Policy Value from any of the Investment Accounts to
the Fixed Account without incurring the transfer charges in (a) above,
provided such transfers occur within:
(continued)
Page 11
16
INVESTMENT OPTIONS (continued)
(1) eighteen months after the Issue Date, as shown in the Policy
Information section of this policy; or
(2) the later of (i) or (ii) below:
(i) 60 days from the effective date of a material change in the
investment objectives of any of the Sub-Accounts; or
(ii) 60 days from the notification date of any such change.
(c) the maximum amount that you can transfer out of the Fixed Account in any
one Policy Year is limited to the greater of:
(1) the Fixed Account Maximum Transfer Percentage shown in the Policy
Information section, multiplied by the value in the Fixed Account at
the previous Policy Anniversary; or
(2) the Fixed Account Maximum Transfer Amount shown in the Policy
Information section.
(d) any transfer out of the Fixed Account may not involve a transfer to the
Investment Account for the Money Market Trust;
(e) transfer privileges are subject to any restrictions we or the
Manufacturers Investment Trust may impose; and
(f) transfer privileges may be terminated at any time.
ASSET ALLOCATION BALANCER TRANSFERS. If you elect this option, we will
automatically transfer amounts among your specified Investment Accounts in order
to maintain your designated percentage in each account. We will effect the
transfers six months after the later of the Policy Date and the last Policy
Anniversary, and at each six month interval thereafter.
The maximum Asset Allocation Balancer Charge for transfers under this option is
shown in the Policy Information section of this policy. We will provide you with
90 days written notice of any change in the current amount.
When you change your premium allocation instructions, your Asset Allocation
Balancer will change so the two are identical. This change will automatically
occur unless you instruct us otherwise, or a Dollar Cost Averaging request is in
effect.
We reserve the right to cease to offer this option as of 90 days after we send
you written notice.
DOLLAR COST AVERAGING. If you elect this option, we will automatically transfer
amounts each month from one Investment Account to one or more of the other
Investment Accounts or the Fixed Account. You must select the amount to be
transferred and the accounts.
If the value in the Investment Account from which the transfer is being made is
insufficient to cover the transfer amount, we will not effect the transfer and
we will notify you.
The maximum Dollar Cost Averaging Charge for transfers under this option is
shown in the Policy Information section of this policy. We will provide you with
90 days written notice of any change in the current amount.
We reserve the right to cease to offer this option as of 90 days after we send
you written notice.
POLICY LOAN CONDITIONS
At any time while this policy is in force and has an available loan value, you
can get a loan by Written Request. We may require a loan agreement from you as
the policy is the only security for the loan.
You should consult your tax advisor before making a decision to take out a new
loan.
(continued)
Page 12
17
POLICY LOAN CONDITIONS (continued)
AVAILABLE LOAN VALUE. The available loan value on any date is 90% of the Net
Cash Surrender Value.
Loan amounts that represent Earnings under the policy are considered Preferred
Loans.
LOAN ACCOUNT. When you take out a loan, or when loan interest charges are
borrowed, we will do a transfer from the Fixed Account and/or one or more of the
Investment Accounts into the Loan Account. Amounts we transfer into the Loan
Account cover the loan principal plus loan interest due to the next Policy
Anniversary.
A Loan Sub-Account exists for each Investment Account and for the Fixed Account.
Amounts transferred to the Loan Account are allocated to the appropriate Loan
Sub-Account to reflect the account from which the transfer was made.
You may tell us how much of the amount to be transferred to the Loan Account you
wish to allocate to your value in the Fixed Account and each of the Investment
Accounts. If you do not tell us, we will allocate the amounts to be transferred
in the same proportion that your value in the Fixed Account and the Investment
Accounts bears to the Net Policy Value.
When an amount to be transferred is allocated to an Investment Account, we will
redeem units of that Investment Account sufficient in value to cover the
allocated amount. These transfers do not count as a transfer for the purposes of
the Transfers section of the Investment Options provision.
Interest is credited to the Loan Account and interest is also charged on the
Policy Debt, as described under the Loan Interest Charged and the Loan Interest
Credited sections of this provision.
LOAN INTEREST CHARGED. Interest will accrue daily on loans. In the event that
you do not pay the Loan Interest Charged in any Policy Year, it will be borrowed
against the policy and added to the Policy Debt in arrears at the Policy
Anniversary. We will allocate the amount borrowed for interest payment in the
same proportion that your value in the Fixed Account and the Investment Accounts
bears to the Net Policy Value as of the Policy Anniversary. The effective annual
Loan Interest Charged Rate is shown in the Table of Values in the Policy
Information section.
LOAN INTEREST CREDITED. Interest will accrue daily to amounts in the Loan
Account. The effective annual Loan Interest Credited Rate for Preferred and
other loans is shown in the Table of Values in the Policy Information section.
Should it be determined at any time that a Preferred Loan would become taxable
under applicable federal tax law, ruling, regulation, or court decision because
loan interest is being charged and credited at the same rate, we will increase
the Loan Interest Charged Rate to the extent necessary for the transaction to be
treated as a loan for federal tax purposes. In no event will the new rate exceed
the effective annual maximum rate permitted under state law.
LOAN REPAYMENT. You may repay the Policy Debt in whole or in part at any time
prior to the death of the Life Insured and while the policy is in force.
Repayments will be applied first to the portion of the Policy Debt that is not a
Preferred Loan.
When you repay a loan, we credit the amount to the Loan Account, and make a
transfer to the Fixed Account and/or the Investment Accounts.
We will allocate loan repayments as follows:
(a) first to the Fixed Account, until the associate Loan Sub-Account is
reduced to zero;
(b) then to each Investment Account in the same proportion that the value in
the corresponding Loan Sub-Account bears to the value of the Loan Account.
While a loan exists, any additional premium payment will be applied first to
repay the Policy Debt.
Page 13
18
SURRENDER AND WITHDRAWALS
SURRENDER OF THE POLICY. You may surrender this policy for its Net Cash
Surrender Value at any time prior to the death of the Life Insured. We will
determine the Net Cash Surrender Value as of the end of the Business Day on
which we receive the policy and your Written Request for surrender at our
Service Office. After we receive your surrender request, no insurance will be in
force.
If you surrender your policy during the Surrender Charge Period, we will deduct
a Surrender Charge from your Policy Value in calculating the Net Cash Surrender
Value. The Surrender Charge will apply to the amount of your Policy Value in
excess of the Free Withdrawal amount.
PARTIAL NET CASH SURRENDER VALUE WITHDRAWAL. Upon Written Request, you may
withdraw a portion of the Net Cash Surrender Value of your policy as a partial
withdrawal. You may specify the accounts from which we should make the partial
Net Cash Surrender Value withdrawal. If we do not receive such instructions, we
will make the withdrawal in the same proportion that the value in the Fixed
Account and the Investment Accounts bears to the Net Policy Value.
Partial withdrawals will be subject to the following conditions:
(a) they can only be made after the first Policy Anniversary;
(b) we will do the withdrawal as of the end of the Business Day on which we
receive your Written Request;
(c) the partial withdrawal cannot be less than the Minimum Withdrawal amount
specified in the Policy Information section;
(d) we will deduct the applicable Surrender Charge if the partial withdrawal
occurs during the Surrender Charge Period and exceeds the Free Withdrawal
Amount;
(e) the withdrawal will result in a reduction in the Face Amount of insurance;
and
(f) if the withdrawal would cause the Policy Value to fall below the Minimum
Initial Premium shown in the Policy Information section, we will treat the
withdrawal request as a full surrender of the policy.
SURRENDER CHARGE DEDUCTION. We will allocate the deduction of the Surrender
Charge for the withdrawal to the Fixed Account and the Investment Accounts in
the same proportion that the withdrawal from each account bears to the total
withdrawal.
If the withdrawal plus the Surrender Charge allocated to a particular account
are greater than the value of that account, we will reduce the portion of the
withdrawal allocated to that account. We will reduce the allocated portion so
that the withdrawal plus the charge allocated to the account equal the value of
the account.
If the amount in all accounts is not sufficient to pay the Surrender Charge, we
will reduce the amount of the withdrawal.
FACE AMOUNT REDUCTION. The Face Amount after a partial withdrawal will be equal
to (a) multiplied by (b), where:
(a) is the Face Amount prior to the withdrawal; and
(b) is the Policy Value after the withdrawal, divided by the Policy Value
prior to the withdrawal.
The reduction in Face Amount will be effective as of the date of the withdrawal.
If the reduction in the Face Amount would require the return of premiums in
order for the policy to qualify as life insurance under Section 7702 of the
Code, or any other equivalent section, we will return such premiums.
Page 14
19
RIGHT TO POSTPONE PAYMENT OF BENEFITS
We reserve the right to postpone the payment of Net Cash Surrender Values,
partial Net Cash Surrender Value withdrawals, policy loans except when used to
make a premium payment and the portion of the Insurance Benefit that depends on
Investment Account values, for any period during which:
(a) the New York Stock Exchange (Exchange) is closed for trading (other than
customary week-end and holiday closings), or trading on the Exchange is
otherwise restricted;
(b) an emergency exists as defined by the Securities and Exchange Commission
(SEC), as a result of which disposal of securities held in the Separate
Account or determining the value of the Separate Account's net assets is
not reasonably practicable, or the SEC requires that trading be
restricted; or
(c) the SEC permits a delay for the protection of policyholders.
Except when used to make a premium payment, we also reserve the right to
postpone payments for up to six months if such payments are based on values that
do not depend on the investment performance of the Sub-Accounts.
If we do not mail or deliver a requested payment within 10 working days of the
date we receive the documentation necessary to complete the transaction, we will
pay interest from such date at the rate prescribed by the state, provided the
interest is at least $ 25.00. At our option, the interest will either be added
to and become part of the total payment or we will pay it separately.
In addition, we may deny transfers under the circumstances stated in (a), (b)
and (c) above, and in the Transfers section of the Investment Options provision.
SUICIDE
If within two years after the Issue Date, the Life Insured under this policy
dies by suicide, the policy will terminate and our liability will be limited to
the Net Premiums Paid.
For purposes of this section, the Net Premiums Paid means:
(a) the premiums paid; less
(b) any partial Net Cash Surrender Value withdrawals; less
(c) the Policy Debt.
BENEFICIARY
The following four sections will apply unless there is a beneficiary appointment
in force that provides otherwise.
BENEFICIARY CLASSIFICATION. You can appoint beneficiaries for the Insurance
Benefit in three classes: primary, secondary and final. Beneficiaries in the
same class will share equally in the Insurance Benefit payable to them.
PAYMENT TO BENEFICIARIES. We will pay the Insurance Benefit:
(a) to any primary beneficiaries who are alive when the Life Insured dies; or
(b) if no primary beneficiary is then alive, to any secondary beneficiaries
who are then alive; or
(c) if no primary or secondary beneficiary is then alive, to any final
beneficiaries who are then alive.
(continued)
Page 15
20
BENEFICIARY (continued)
CHANGE OF BENEFICIARY. Until the Life Insured's death you can change the
beneficiary by Written Request unless you make an irrevocable designation. We
are not responsible if the change does not achieve your purpose. The change will
take effect as of the date you signed such request. It will not apply to any
payments we made or any action we may have taken before we received your Written
Request.
DEATH OF BENEFICIARY. If no beneficiary is alive when the Life Insured dies, the
Insurance Benefit will be payable to you; or to your estate if you are the Life
Insured. Unless otherwise provided, if a beneficiary dies before the seventh day
after the death of the Life Insured, we will pay the Insurance Benefit as if the
beneficiary had died before the Life Insured.
OWNERSHIP AND ASSIGNMENT
Until the Life Insured's death, without the consent of any beneficiary, except
an irrevocable beneficiary, you as owner can:
(a) receive any amount payable under your policy;
(b) exercise all rights and privileges granted by the policy; and
(c) assign the policy.
An assignment does not bind us until we receive it in writing at our Service
Office. We are not responsible for its validity or its effects. It should be
filed with us in duplicate. We will return a copy.
CHANGE OF OWNER. Until the Life Insured's death, the owner can change the
ownership of the policy by Written Request. The change will take effect as of
the date you signed the Written Request. It will not apply to any payments we
made or any action we may have taken before we received your Written Request.
TRUSTEE OWNER. Should the owner be a trustee, payment to the trustee(s) of any
amount to which the trustee(s) is (are) entitled under the policy, either by
death or otherwise, will fully discharge us from all liability under the policy
to the extent of the amount so paid.
JOINT OWNERSHIP. Two or more owners will own the policy as joint tenants with
right of survivorship, unless otherwise requested on the application or in any
subsequent assignment of the policy. On death of any of the owners, the deceased
owner's interest in the policy passes to the surviving owner(s).
Any rights and privileges that may be exercised by the owner, may be exercised
only with the consent of all joint owners.
SUCCESSOR OWNER. Upon the owner's death during the lifetime of the Life Insured,
a named successor owner will, if then living, have all the owner's rights and
interest in the policy. Until the Life Insured's death, the owner, without the
consent of any revocable beneficiary or any successor owner, can cancel or
change the designation of successor owner. This may be done from time to time by
agreement in writing with us.
PROTECTION AGAINST CREDITORS
If permitted by state law, all payments shall be exempt from the debts and
contracts of the owners and beneficiaries, and from seizure by court order.
CURRENCY AND PLACE OF PAYMENT
All payments to or by us will be in U.S. currency. We will make payments from
our Service Office. We may require proof that the person claiming any payment is
entitled to it.
Page 16
21
CONTRACT
The policy, application, supplementary benefits, and any endorsements form your
whole contract. A copy of the application is attached to the policy and deemed a
part of it. We will not be bound by any statement that is not in the application
or the policy.
Only our President or one of our Vice-Presidents can agree to amend or modify
the policy or waive any of its provisions. Any change must be in writing.
Statements made by you or the Life Insured are representations, not warranties.
We will not use any statement by you or the Life Insured to deny a claim, unless
it is written in the application or any supplement to the application.
VALIDITY
We have the right to contest the validity of this policy based on material
misstatements made in the initial application or an application for policy
change that requires evidence of insurability. However, we cannot contest the
validity of your policy after it has been in force during the lifetime of the
Life Insured for two years from the Issue Date, or the effective date of a
policy change that required evidence of insurability.
We can contest after two years if the policy has been reinstated and has been in
force during the lifetime of the Life Insured for less than two years from the
reinstatement date. If this is the case, we can only contest the validity in
respect of any fact material to the reinstatement that was misrepresented.
NON-PARTICIPATING
Your policy is non-participating. It does not earn dividends.
AGE AND SEX
If the Age or Sex of a Life Insured was misstated in the application, we will
change the Face Amount of insurance. The new Face Amount will be determined so
that the Death Benefit will be that which the most recent Cost of Insurance
deduction would have purchased for the correct Age and Sex.
CONVERSION PRIVILEGE
By Written Request, you may convert your policy to a fixed paid-up benefit at
any Policy Anniversary, without evidence of insurability.
The conversion is subject to the following conditions:
(a) no further Monthly Deductions will be taken from the Policy Value after the
date of conversion;
(b) the Death Benefit, the Policy Value, other values based on the Policy
Value, and the Investment Account values will be determined as of the
Business Day on which we receive your Written Request for conversion;
(c) the fixed paid-up benefit is determined by dividing the Net Cash Surrender
Value by the net single premium. The basis for determining the net single
premium and Policy Value will be the Commissioners 1980 Standard Ordinary
Smoker or Non-Smoker Mortality Table and an interest rate of 4% per year;
and
(d) the Modified Single Premium Variable Life coverage cannot be reinstated
after the date of the conversion.
Page 17
22
FLEXIBLE FACTORS
When determining the rate of interest to be used in crediting interest to the
portion of the Policy Value in the Fixed Account, and any changes in that rate,
we will consider the following factors: expected mortality and persistency
experience; expected general account investment earnings; and expected operating
expenses. We will consider the same factors when we determine the actual cost of
insurance; the deductions for tax load; administrative charges; and whenever
changes are made to any of these charges. We will not try to recover any losses
in earlier years by increasing your charges in later years.
Adjustments to flexible factors will be by class and be determined by us from
time to time based on future expectations for such factors. Any change will be
determined in accordance with procedures and standards on file with the
Superintendent of Insurance of the state of New York.
HOW VALUES ARE COMPUTED
We provide Cash Surrender Values that are at least equal to those required by
law. A detailed statement of the method of computing the values of this policy
has been filed with the insurance department of the state in which this policy
is delivered.
We use the Commissioners 1980 Standard Ordinary Smoker/Non-Smoker Mortality
Table in computing reserves, and in determining Maximum Cost of Insurance Rates.
Values relating to amounts in the Fixed Account are computed at the Minimum
Guaranteed Annual Fixed Account Rate shown in the Table of Values in the Policy
Information section.
Current cost of insurance rates and the current interest rate being credited to
the Fixed Account will be reviewed at least once every five Policy Years, but we
will not make a change more than once each Policy Year.
ANNUAL STATEMENT
Within 30 days after each Policy Anniversary, we will send you a report showing:
(a) the Death Benefit;
(b) the Policy Value;
(c) the current allocation of money in the Fixed Account, the Loan Account and
each of the Investment Accounts;
(d) the value of the units in each chosen Investment Account;
(e) any Loan Account balance and loan interest charged since the last report;
(f) the premiums paid and policy transactions for the year; and
(g) any further information required by law.
TAX CONSIDERATIONS
It is the intent that this policy be considered as life insurance for tax
purposes, to comply with Section 7702 of the Code, or any other equivalent
section. We reserve the right to limit the amount of premiums paid for this
policy, or to make any other reasonable adjustments to the terms or conditions
of this policy if it becomes necessary to allow it to qualify as life insurance.
This provision should not be construed to guarantee that the policy will be
treated as life insurance or that the tax treatment of life insurance will never
be changed by the future actions of any tax authority.
Page 18
23
- --------------------------------------------------------------------------------
[MANULIFE FINANCIAL LOGO]
MANULIFE FINANCIAL
THE MANUFACTURERS LIFE INSURANCE
COMPANY OF NEW YORK
- --------------------------------------------------------------------------------
MODIFIED SINGLE PREMIUM VARIABLE LIFE INSURANCE.
Benefit payable on the earlier of the Life Insured's death or the Maturity Date.
Policy Values allocated to an Investment Account reflect the investment
experience of the underlying Sub-Accounts. Investment options are described in
the "Policy Value Composition" and the "Investment Options" provisions.
Non-participating (not eligible for dividends).
- --------------------------------------------------------------------------------
IMPORTANT NOTICE
To claim a benefit or request a change
in your policy, contact our nearest
representative or write to our Service
Office at the address below.
Please tell us promptly of any change
in your address.
We strongly urge that, before you take
any action to replace this or any other
policy, you ask the advice of the
company that issued the policy.
- --------------------------------------------------------------------------------
Service Office Mailing Address:
The Manufacturers Life Insurance Company of New York
P.O. Box 633
Niagara Square Station
Buffalo, NY 14202-0633
Toll Free Number: 1-888-267-7784
Manulife Financial and the block design are registered service marks of The
Manufacturers Life Insurance Company and are used by it and its subsidiaries.
24
SUPPLEMENTARY BENEFIT
LAPSE PROTECTION BENEFIT
This benefit is a part of your policy. Should any provisions in your policy
conflict with this benefit, the provisions of this benefit will prevail.
EFFECTIVE DATE
The benefit takes effect on the Policy Date shown in the Policy Information
section.
BENEFIT
If the Net Cash Surrender Value of your policy falls to zero or below, this
benefit prevents your policy from going into default provided that there is no
Policy Debt.
The duration of the Lapse Protection Benefit is shown in the Policy Information
section of the policy.
TERMINATION
The benefit terminates on the earlier of the following dates:
(a) the end of the Lapse Protection Benefit period; or
(b) the date the policy terminates.
The benefit can be reinstated with your policy.
THE MANUFACTURERS LIFE INSURANCE COMPANY OF NEW YORK
/s/ James W. Gallagher
President
25
LIFE INSURED ONE JOHN M. DOE
LIFE INSURED TWO MARY J. DOE
POLICY NUMBER 12 345 678
MODIFIED SINGLE PREMIUM SURVIVORSHIP VARIABLE LIFE INSURANCE.
BENEFIT PAYABLE ON THE EARLIER OF THE DEATH OF THE LAST SURVIVOR OR THE
MATURITY DATE.
POLICY VALUES ALLOCATED TO AN INVESTMENT ACCOUNT REFLECT THE INVESTMENT
EXPERIENCE OF THE UNDERLYING SUB-ACCOUNTS. INVESTMENT OPTIONS ARE DESCRIBED IN
THE "POLICY VALUE COMPOSITION" AND THE "INVESTMENT OPTIONS" PROVISIONS.
NON-PARTICIPATING (NOT ELIGIBLE FOR DIVIDENDS).
In this policy "you" and "your" refer to the owner of the policy. "We", "us" and
"our" refer to The Manufacturers Life Insurance Company of New York.
If the Life Insured is living and the policy is in force on the Maturity Date,
we will pay you the Policy Value less any outstanding Policy Debt.
If the Life Insured dies while the policy is in force, we will pay the Insurance
Benefit to the beneficiary, subject to the provisions of the policy. The Life
Insured and the beneficiary are named on page 3 and in the application for this
policy, a copy of which is attached to this policy. If more than one Life
Insured is named, the Insurance Benefit is payable on the death of the last
survivor.
THIS POLICY IS DESIGNED TO PERMIT A LARGE INITIAL PREMIUM AND, SUBJECT TO
CERTAIN CONDITIONS, ADDITIONAL PREMIUMS. YOU MAY ALLOCATE YOUR PREMIUMS TO ONE
OR MORE OF THE AVAILABLE INVESTMENT ACCOUNTS AND/OR THE FIXED ACCOUNT.
THE PORTION OF YOUR POLICY VALUE THAT IS IN AN INVESTMENT ACCOUNT WILL VARY FROM
DAY TO DAY. THE AMOUNT IS NOT GUARANTEED; IT MAY INCREASE OR DECREASE, DEPENDING
ON THE INVESTMENT EXPERIENCE OF THE UNDERLYING SUB-ACCOUNTS FOR THE INVESTMENT
ACCOUNTS THAT YOU HAVE CHOSEN.
THE PORTION OF YOUR POLICY VALUE THAT IS IN THE FIXED ACCOUNT WILL ACCUMULATE,
AFTER DEDUCTIONS, AT RATES OF INTEREST WE DETERMINE. SUCH RATES WILL NOT BE LESS
THAN THE EFFECTIVE ANNUAL FIXED ACCOUNT RATE SHOWN ON PAGE 3.2.
READ YOUR POLICY CAREFULLY. IT IS A CONTRACT BETWEEN YOU AND US.
RIGHT TO RETURN POLICY. WITHIN EITHER (1) TEN DAYS AFTER RECEIVING YOUR POLICY
IF IT DOES NOT REPLACE ANOTHER POLICY; OR (2) SIXTY DAYS IF IT REPLACES AN
EXISTING POLICY, YOU CAN RETURN THE POLICY FOR CANCELLATION BY DELIVERING OR
MAILING IT TO US OR THE AGENT WHO SOLD IT. IMMEDIATELY UPON DELIVERY OR MAILING,
THE POLICY WILL BE VOID FROM THE BEGINNING. WE WILL REFUND IN FULL THE PREMIUM
PAID.
- --------------------------------------------------------------------------------
[MANULIFE FINANCIAL LOGO]
MANULIFE FINANCIAL
THE MANUFACTURERS LIFE INSURANCE
COMPANY OF NEW YORK
Home Office: 100 Summit Lake Drive, 2nd Floor, Valhalla, NY 10595
[James W. Gallagher Signature] [Signature Illegible]
President Secretary
- --------------------------------------------------------------------------------
26
TABLE OF CONTENTS
PAGE
Policy Information..................................................................... 3
Table Of Guaranteed Maximum Cost Of Insurance Rates.................................... 4
Definitions............................................................................ 5
Premium Payments....................................................................... 6
Policy Termination..................................................................... 7
Reinstatement.......................................................................... 7
Maturity Benefit....................................................................... 8
Insurance Benefit...................................................................... 8
Policy Value........................................................................... 8
Policy Value Composition............................................................... 9
Separate Account And Sub-Accounts...................................................... 10
Investment Options..................................................................... 11
Policy Loan Conditions................................................................. 12
Surrender And Withdrawals.............................................................. 14
Right To Postpone Payment Of Benefits.................................................. 15
Suicide................................................................................ 15
Beneficiary............................................................................ 16
Ownership And Assignment............................................................... 16
Protection Against Creditors........................................................... 16
Currency And Place Of Payment.......................................................... 16
Contract............................................................................... 17
Validity............................................................................... 17
Non-Participating...................................................................... 17
Age And Sex............................................................................ 17
Conversion Privilege................................................................... 17
Flexible Factors....................................................................... 18
How Values Are Computed................................................................ 18
Annual Statement....................................................................... 18
Tax Considerations..................................................................... 18
Any endorsements, any supplementary benefits, and a copy of the application,
follow page 18.
Page 2
27
POLICY INFORMATION
LIFE INSURED ONE JOHN M. DOE AGE AT POLICY DATE: 35
LIFE INSURED TWO MARY J. DOE AGE AT POLICY DATE: 35
POLICY NUMBER 12 345 678 POLICY DATE: SEP 1, 1999
ISSUE DATE: SEP 1, 1999
MATURITY DATE: SEP 1, 2064
OWNER JOHN M. DOE
BENEFICIARY AS DESIGNATED IN THE APPLICATION OR
SUBSEQUENTLY CHANGED
PLAN MODIFIED SINGLE PREMIUM SURVIVORSHIP VARIABLE
LIFE INSURANCE
NON-PARTICIPATING
PAYABLE ON DEATH OF LAST SURVIVOR
LAPSE PROTECTION BENEFIT PERIOD: 30 POLICY YEARS
FACE AMOUNT $336,655.86
INITIAL PREMIUM $25,000.00
SEX LIFE INSURED ONE: MALE
SEX LIFE INSURED TWO: FEMALE
RISK
CLASSIFICATION LIFE INSURED ONE: NON-SMOKER, STANDARD CLASS
LIFE INSURED TWO: NON-SMOKER, STANDARD CLASS
ADDITIONAL
RATING NOT APPLICABLE
Life insurance coverage under this policy may expire prior to the maturity date
if premium and investment experience are insufficient to continue coverage to
such date.
Keeping the policy and coverage in force will be affected by factors such as:
changes in the current cost of insurance rates; the amount, timing and frequency
of premium payments; the interest rate being credited to the Fixed Account; the
investment experience of the Sub-Accounts; loan activity; and partial
withdrawals. Also refer to the "Policy Termination" provision of your policy.
Subject to the guarantees of this policy, we reserve the right to change the
current Cost Of Insurance Rate Deductions and the current Interest Rate being
credited to the Fixed Account. These changes may require more premium to be paid
cause the cash value to be less than illustrated.
(Joint Life)
PAGE 3.0
28
POLICY INFORMATION (CONTINUED) - POLICY 12 345 678
TABLE OF CHARGES
Unless otherwise specified, charges are based on and deducted proportionately
from the Fixed Account Value and the Investment Account Value.
TAX LOAD:
0.030% MONTHLY FOR 10 YEARS AFTER THE DATE OF EACH PREMIUM PAYMENT. THE
TAX LOAD FOR ADDITIONAL PREMIUMS IS BASED ON THE PROPORTION OF THE
POLICY VALUE ASSOCIATED WITH THE PREMIUM.
ADMINISTRATION CHARGE:
A FLAT MONTHLY CHARGE OF $7.50, PLUS 0.010% MONTHLY.
MORTALITY AND EXPENSE RISKS CHARGE:
0.075% DEDUCTED MONTHLY FROM EACH INVESTMENT ACCOUNT VALUE FOR THE FIRST
10 POLICY YEARS, REDUCING TO 0.025% THEREAFTER.
COST OF INSURANCE CHARGE:
SEE THE MONTHLY DEDUCTIONS SECTION OF THE POLICY VALUE PROVISION FOR DETAILS
ON HOW THE COST OF INSURANCE CHARGE IS DETERMINED.
PAGE 3.1A
29
POLICY INFORMATION (CONTINUED) - POLICY 12 345 678
TABLE OF CHARGES (CONTINUED)
SURRENDER CHARGE:
A SURRENDER CHARGE WILL BE DEDUCTED FROM YOUR POLICY VALUE UNDER CERTAIN
CONDITIONS. SEE THE FOLLOWING PROVISIONS FOR DETAILS: POLICY VALUE AND SURRENDER
AND WITHDRAWALS.
AS SHOWN BELOW, THE SURRENDER CHARGE IS A PERCENTAGE OF THE POLICY VALUE BEING
WITHDRAWN OR SURRENDERED IN EXCESS OF THE FREE WITHDRAWAL AMOUNT.
SURRENDER SURRENDER CHARGE PERCENTAGE
CHARGE PERIOD
- ------------------------------------------------------------
1 10.00%
2 9.00%
3 8.00%
4 7.00%
5 6.00%
6 5.00%
7 4.00%
8 3.00%
9 1.50%
10 0.00%
Percentage shown is at beginning of policy year. For other policy
months the percentage can be found by reducing the above percentages
proportionately.
MAXIMUM SURRENDER CHARGE:
IF NECESSARY, THE SURRENDER CHARGE DETERMINED ABOVE WILL BE REDUCED SUCH THAT
THE SUM OF (A) AND (B) DOES NOT EXCEED (C) WHERE:
(A) IS THE CUMULATIVE PREMIUM LOAD AND ADMINISTRATIVE CHARGE DEDUCTED UNDER
THE POLICY;
(B) IS THE SURRENDER CHARGE DETERMINED BY THE ABOVE TABLE; AND
(C) IS 10% OF PREMIUMS RECEIVED IN THE FIRST POLICY YEAR.
PAGE 3.1B
30
POLICY INFORMATION (CONTINUED) - POLICY 12 345 678
TABLE OF VALUES
Refer to your policy provisions for details on the terms and values shown in
this table.
GUIDELINE SINGLE PREMIUM $25,000.00
GUIDELINE LEVEL PREMIUM $2,134.44
MINIMUM INITIAL PREMIUM $25,000.00
MINIMUM WITHDRAWAL AMOUNT $500.00
TRANSFER FEE $25.00
(FOR TRANSFERS IN EXCESS OF 12 IN A POLICY YEAR)
MAXIMUM ASSET ALLOCATION BALANCER CHARGE $15.00
MAXIMUM DOLLAR COST AVERAGING CHARGE $5.00
FIXED ACCOUNT MAXIMUM TRANSFER PERCENTAGE 15%
FIXED ACCOUNT MAXIMUM TRANSFER AMOUNT $500.00
MINIMUM GUARANTEED ANNUAL FIXED ACCOUNT RATE 4.00%
LOAN INTEREST CHARGED RATE (ALL LOANS) 6.00%
LOAN ACCOUNT CREDITED RATE
PREFERRED LOANS 6.00%
OTHER LOANS 4.00%
MAXIMUM LOAN INTEREST CREDITED DIFFERENTIAL (OTHER LOANS) 2.00%
DEATH BENEFIT DISCOUNT FACTOR 1.0032737
PAGE 3.2
31
POLICY INFORMATION (CONTINUED) - POLICY 12 345 678
TABLE OF MINIMUM DEATH BENEFIT PERCENTAGES
ATTAINED AGE APPLICABLE PERCENTAGE
- --------------------------------------------------------------------------------
40 and under 250%
45 215%
50 185%
55 150%
60 130%
65 120%
70 115%
75 105%
90 105%
95 and above 100%
For ages not shown, the Applicable Percentage can be found by reducing
the above Applicable Percentages proportionately.
PAGE 3.3
32
TABLE OF GUARANTEED MAXIMUM COST OF INSURANCE RATES
GUARANTEED MAXIMUM MONTHLY RATES PER $1,000
OF NET AMOUNT AT RISK
FOR THE LIVES INSURED UNDER THIS POLICY
DURATION MONTHLY DURATION MONTHLY DURATION MONTHLY
(POLICY RATE (POLICY RATE (POLICY RATE
YEARS) $ YEARS) $ YEARS) $
1 0.000207 23 0.103964 45 3.953521
2 0.000665 24 0.122184 46 4.558705
3 0.001212 25 0.143495 47 5.253161
4 0.001864 26 0.168742 48 6.055917
5 0.002654 27 0.198793 49 6.980966
6 0.003598 28 0.235576 50 8.015102
7 0.004763 29 0.281020 51 9.149825
8 0.006128 30 0.336457 52 10.364422
9 0.007748 31 0.401980 53 11.654835
10 0.009612 32 0.478377 54 13.000300
11 0.011830 33 0.565716 55 14.412617
12 0.014426 34 0.664435 56 15.891977
13 0.017472 35 0.777709 57 17.459834
14 0.021034 36 0.911511 58 19.156860
15 0.025213 37 1.080715 59 21.054761
16 0.030130 38 1.268137 60 23.368153
17 0.036011 39 1.507613 61 26.517002
18 0.043094 40 1.795237 62 31.354662
19 0.051658 41 2.130491 63 39.595173
20 0.061825 42 2.513928 64 54.652603
21 0.073840 43 2.944356 65 83.333333
22 0.087887 44 3.421111
THE ABOVE RATES HAVE BEEN INCREASED FOR ANY ADDITIONAL RATING SHOWN IN THE
POLICY INFORMATION SECTION.
Page 4
33
DEFINITIONS
THE FOLLOWING TERMS HAVE SPECIFIC MEANINGS IN YOUR POLICY. PLEASE REFER TO THESE
DEFINITIONS AS YOU READ YOUR POLICY.
ADDITIONAL RATING is an increase in the Cost of Insurance Rate that is applied
when a Life Insured does not meet, at a minimum, our underwriting requirements
for the standard Risk Classification.
AGE at a specific date means age on the nearest birthday. If no specific date is
mentioned, age means the Life Insured's age on the Policy Anniversary nearest to
the birthday.
ATTAINED AGE on any date means the Age plus the number of whole years that have
elapsed since the Policy Date, based on the youngest Life Insured when the
policy is first issued.
BUSINESS DAY is any day that the New York Stock Exchange is open for business.
The net asset value of the underlying shares of a Sub-Account will be determined
as of the end of each Business Day. A Business Day ends at the close of
regularly scheduled day-time trading of the New York Stock Exchange on that day.
CASH SURRENDER VALUE equals the Policy Value reduced by any Surrender Charge and
any outstanding Monthly Deductions due.
CODE means the Internal Revenue Code of 1986 (as amended).
EARNINGS is an amount calculated in relation to a loan, partial Net Cash
Surrender Value Withdrawal or surrender of the policy. It is equal to (a) minus
the sum of (b) and (c), each calculated as of the date we receive your Written
Request, where:
(a) is the Policy Value;
(b) is the value of any Policy Debt; and
(c) is total premiums paid.
FIXED ACCOUNT is that part of the Policy Value which reflects the value you have
in our general account.
FREE WITHDRAWAL AMOUNT is, at any date, the greater of
(a) and (b), where:
(a) is 100% of Earnings; and
(b) is 10% of total premiums paid.
INVESTMENT ACCOUNT is that part of the Policy Value that reflects the value you
have in one of the Sub-Accounts.
ISSUE DATE is the date shown in the Policy Information section from which the
Suicide and Validity provisions are applied.
LIFE INSURED is the person or persons whose life is covered by this policy as
specified in the Policy Information section. All provisions of the policy which
are based on the death of the Life Insured will be based on the death of the
last survivor of the persons so named.
LOAN ACCOUNT is that part of the Policy Value which reflects the value
transferred from the Fixed Account or the Investment Accounts as collateral for
a policy loan.
MATURITY DATE is the date shown in the Policy Information section. It is the
Policy Anniversary nearest the date on which the youngest Life Insured reaches
or would have reached Attained Age 100.
NET CASH SURRENDER VALUE is the Cash Surrender Value less the Policy Debt.
NET POLICY VALUE is the Policy Value less the value in the Loan Account.
POLICY DATE is the date coverage takes effect under the policy provided we
receive the full amount of the initial premium at our Service Office. The Policy
Date is shown in the Policy Information section. The amount of the first Monthly
Deduction is calculated from the Policy Date. The Policy Date is also used to
determine Policy Years, Policy Months and Policy Anniversaries.
(continued)
Page 5
34
DEFINITIONS (continued)
POLICY DEBT as of any date equals (a) plus (b) plus (c) minus (d), where:
(a) is the total amount of loans borrowed as of such date;
(b) is the total amount of any unpaid loan interest charges which have been
borrowed against the policy on a Policy Anniversary;
(c) is any interest charges accrued from the last Policy Anniversary to the
current date;and
(d) is the total amount of loan repayments as of such date.
POLICY VALUE is the sum of the values in the Loan Account, the Fixed Account and
the Investment Accounts.
SEPARATE ACCOUNT refers to Separate Account B of The Manufacturers Life
Insurance Company of New York.
SERVICE OFFICE is the office we designate to service this policy. The Service
Office Mailing Address is The Manufacturers Life Insurance Company of New York,
P.O. Box 633, Niagara Square Station, Buffalo, NY 14202-0633. The Home Office
Address is 100 Summit Lake Drive, 2nd Floor, Valhalla, NY 10595.
SUB-ACCOUNT refers to one of the sub-accounts of the Separate Account.
SURRENDER CHARGE PERIOD is the period following the Issue Date of the policy
during which we will assess surrender charges. Surrender charges will apply
during this period to amounts in excess of the Free Withdrawal Amount if you
surrender the policy or make a partial withdrawal, or if the policy terminates
due to default. The Surrender Charge Period is shown in the Policy Information
section.
WRITTEN REQUEST is your request to us which must be in a form satisfactory to
us, signed and dated by you, and filed at our Service Office.
PREMIUM PAYMENTS
Premiums are payable at our Service Office. On request, we will give you a
receipt signed by one of our officers.
INITIAL PREMIUM. No insurance will take effect under this policy before we
approve the application and receive the initial premium. The Minimum Initial
Premium is shown in the Policy Information section. The initial premium is used
to determine the Face Amount of insurance.
ADDITIONAL PREMIUMS. You may pay additional premiums subject to the following
conditions:
(a) we have the right to refuse or refund any premium payments that would
cause this policy to fail to qualify as life insurance under Section
7702 of the Code or any other equivalent section;
(b) we reserve the right to request that you provide us with satisfactory
evidence of insurability if a premium payment would result in an
increase in the Death Benefit that is greater than the increase in
Policy Value; and (c) the sum of the premiums paid into this policy at
any time may not exceed the guideline premium limitation as of such
time. The guideline premium limitation is, as of any date, the greater
of:
(1) the Guideline Single Premium, or
(2) the sum of the Guideline Level Premiums to such date.
The Guideline Single Premium and the Guideline Level Premium are shown
in the Policy Information section; and
(d) while there is an outstanding Policy Debt, any additional premium
payment will be applied first to repay the Policy Debt.
(continued)
Page 6
35
PREMIUM PAYMENTS (continued)
ALLOCATION OF PREMIUM PAYMENTS. You may allocate premiums to any of the
Investment Accounts and/or the Fixed Account. Unless you change the initial
premium allocation specified in your application for this policy, it will
continue to apply to additional premium payments.
Allocation percentages must be zero or a whole number not greater than 100. The
sum of the allocation percentages must equal 100. You may change the allocation
percentages by Written Request to our Service Office. The change will take
effect as of the date we receive your request at our Service Office.
POLICY TERMINATION
DEFAULT. The policy will go into default if, at the beginning of any Policy
Month the Net Cash Surrender Value would go to zero or below after we take the
Monthly Deduction that is due for that month.
GRACE PERIOD. We will allow 61 days from the date that the policy goes into
default, for you to pay the amount that is required to bring the policy out of
default. At least 15 but not more than 45 days prior to the termination of
coverage, we will send a notice to your last known address, specifying the
amount you must pay to bring the policy out of default. If we have notice of a
policy assignment on file at our Service Office, we will also mail a copy of the
notice of the amount due to the assignee on record.
The amount required to bring the policy out of default is equal to (a) plus (b),
where:
(a) is the amount necessary to bring the Net Cash Surrender Value to zero,
if it is less than zero, at the date of default; and
(b) is the Monthly Deduction due on the date of default, plus an amount to
cover Monthly Deductions to the later of the next Policy Anniversary or
at least three Policy Months.
If the amount necessary to bring the policy out of default has not been paid by
the end of the grace period, the policy will terminate.
TERMINATION DATE. This policy terminates on the earliest of the following
events:
(a) the end of the grace period for which you have not paid the amount
necessary to bring the policy out of default;
(b) surrender of the policy for its Net Cash Surrender Value;
(c) the Maturity Date; or
(d) the death of the Life Insured.
REINSTATEMENT
You can ask us to reinstate your policy only if it terminates at the end of a
grace period in which you did not make a required payment, and no Life Insured
died during the period of termination.
You can reinstate the policy if you:
(a) make a Written Request for reinstatement within 5 years after the date
your policy terminates;
(b) provide us with evidence of insurability satisfactory to us on the Life
Insured; and
(c) pay a premium equal to the amount that was required to bring the policy
out of default immediately prior to termination, plus an amount to
cover Monthly Deductions to the later of the next Policy Anniversary or
at least three Policy Months.
(continued)
Page 7
36
REINSTATEMENT (continued)
If we approve your request,
(a) the reinstatement date will be the later of the date we approve your
request or the date we receive the required payment at our Service
Office; and
(b) any remaining Surrender Charge Period will be reinstated to what it was
at the date of default.
(c) The Surrender Charge in effect on the date of reinstatement will be the
same as the Surrender Charge in effect on the date of default.
The Policy Value on the date of reinstatement, prior to the crediting of any Net
Premium paid on the reinstatement, will be equal to the Policy Value on the date
the policy terminated.
MATURITY BENEFIT
Provided the policy is in force and the Life Insured is alive on the Maturity
date, we will pay you the following amount calculated as of the Maturity Date:
(a) the Policy Value, less
(b) any outstanding Policy Debt.
INSURANCE BENEFIT
If the Life Insured dies prior to the Maturity Date, while the policy is in
force, we will pay the Insurance Benefit to the beneficiary on receiving due
proof of death, subject to the Age and Sex, Suicide and Validity provisions.
If the Life Insured dies after we receive a request from you to surrender the
policy, there will be no Insurance Benefit. We will pay the amount payable under
the Surrender And Withdrawals provision instead.
You must provide us with proof of the death of each Life Insured although the
Insurance Benefit is payable at last death.
INSURANCE BENEFIT. The Insurance Benefit payable is:
(a) the Death Benefit as described below; less
(b) the value of the Policy Debt as of the date of death.
If the Life Insured dies during a grace period prior to the Maturity Date, the
Insurance Benefit will be reduced by any outstanding Monthly Deductions due.
DEATH BENEFIT. The Death Benefit is the greater of (a) and (b) where:
(a) is the Face Amount of the policy at the date of the Life Insured's
death; and
(b) is the Policy Value at the date of death, multiplied by the Applicable
Percentage in the Table of Minimum Death Benefit Percentages shown in
the Policy Information section.
POLICY VALUE
INITIAL PREMIUM. Based on your allocation instructions, we will allocate your
initial premium plus any earned interest on the later of the date our
underwriters approve issuance of the policy or the Business Day we receive the
initial premium at our Service Office. For premium received prior to the
underwriting decision we will credit interest as of the date we received the
initial premium payment at the rate of return then being earned on allocations
to the Money Market Trust. This initial allocation will become your Policy Value
to which additional premiums will be allocated.
ADDITIONAL PREMIUMS. We will add your premium to your Policy Value as of the
Business Day we receive an additional premium at our Service Office. However, if
evidence of insurability is required for an additional premium, we will add it
to your Policy Value as of the Business Day our underwriters approve the
evidence, but before we take any deductions due as of that Business Day.
(continued)
Page 8
37
POLICY VALUE (continued)
MONTHLY DEDUCTIONS. Monthly Deductions are due until the Maturity Date. At the
beginning of each Policy Month, a deduction is taken from your policy to cover
the following expense charges:
(a) Tax Load, if applicable;
(b) Administration Charge;
(c) Mortality and Expense Risks Charge; and
(d) Cost of Insurance Charge.
The Cost of Insurance Charge is described below. The amount and duration of the
other charges are shown in the Table of Expense Charges in the Policy
Information section.
Unless specified otherwise in the Table of Expense Charges, we will take Monthly
Deductions from the Fixed Account and the Investment Accounts in the same
proportion that the Policy Value in each of these accounts bears to the Net
Policy Value immediately prior to the deduction. We will take the deductions
according to your instructions if we approve your request and you have
sufficient funds in the accounts.
COST OF INSURANCE CHARGE. The Cost of Insurance for a specific Policy Month is
determined as the rate for the Cost of Insurance for that month, as described
below, multiplied by the net amount at risk.
The net amount at risk is equal to (a) minus (b), where:
(a) is the Death Benefit as of the first day of the Policy Month, divided
by the Death Benefit Discount Factor shown in the Table of Values in
the Policy Information section; and
(b) is the Policy Value as of the first day of the Policy Month.
The rates for the Cost of Insurance are based on the Life Insured's Age, Sex,
Risk Classification and duration that the coverage has been in force. The Cost
of Insurance calculation will reflect any Additional Rating shown in the Policy
Information section. The individual rates determined for each Life Insured on
the bases specified above are blended to produce a single rate.
We will re-determine Cost of Insurance rates from time to time on a basis that
does not discriminate unfairly within any class of Life Insured. The Cost of
Insurance rates will never exceed those shown on Page 4 in the Table of
Guaranteed Maximum Cost of Insurance Rates.
OTHER DEDUCTIONS. As stated in the Surrender and Withdrawal provision, we will
deduct a Surrender Charge if during the Surrender Charge Period you:
(a) surrender the policy, and the Net Cash Surrender Value is above the
Free Withdrawal Amount; or
(b) make partial withdrawals above the Free Withdrawal Amount.
POLICY VALUE COMPOSITION
Your Policy Value at any time is equal to the sum of the values you have in the
Loan Account, the Fixed Account and the Investment Accounts.
LOAN ACCOUNT VALUE. The amount you have in the Loan Account at any time equals:
(a) amounts transferred to it for loans or borrowed loan interest; plus
(b) interest credited to it; less
(c) amounts transferred from it for loan repayment.
For the details of the Loan Account see the Policy Loan Conditions provision.
FIXED ACCOUNT VALUE. The amount you have in the Fixed Account at any time
equals:
(a) premiums allocated to it; plus
(b) amounts transferred to it; plus
(continued)
Page 9
38
POLICY VALUE COMPOSITION (continued)
(c) interest credited to it; less
(d) amounts deducted from it; less
(e) amounts transferred from it; less
(f) amounts withdrawn from it.
Interest will be credited to amounts in the Fixed Account at an effective annual
rate of no less than the Minimum Guaranteed Annual Fixed Account Rate shown in
the Table of Values in the Policy Information Section. The actual interest rate
used will be set by us from time to time. For all transactions, interest is
calculated from the date of the transaction.
INVESTMENT ACCOUNT VALUE. The amount you have in an Investment Account at any
time equals the number of units in that Investment Account, multiplied by the
unit value of the corresponding Sub-Account at that time.
The number of units in an Investment Account at any time equals (a) minus (b),
where:
(a) is the number of units credited to the Investment Account because of:
(1) premiums allocated to it; and
(2) amounts transferred to it; and
(b) is the number of units canceled from the Investment Account because of:
(1) amounts deducted from it;
(2) amounts transferred from it; and
(3) amounts withdrawn from it.
The number of units credited or canceled for a given transaction is equal to the
dollar amount of the transaction, divided by the unit value as of the Business
Day of the transaction. See the Unit Value Calculation section of this provision
for details on how unit values are determined.
SEPARATE ACCOUNT AND SUB-ACCOUNTS
The Separate Account is authorized to invest in the shares of Manufacturers
Investment Trust, or another management investment company. Each Sub-Account of
the Separate Account purchases shares of a corresponding fund of Manufacturers
Investment Trust or another management investment company.
FUND SUBSTITUTION. An available fund might, in our judgment, become unsuitable
for investment by a Sub-Account. This might happen because of a change of
investment policy; or a change in the applicable laws or regulations; or because
the shares are no longer available for investment; or for some other reason.
If an available fund becomes unsuitable for investment, we have the right to
substitute another fund or another management investment company. Before doing
this, we would first seek, where required, approval from the Securities and
Exchange Commission and the Superintendent of Insurance of the State of New
York.
To the extent permitted by applicable federal and state law, we also have the
right, without your approval, to:
(a) create new separate accounts;
(b) combine any two or more separate accounts including the Separate
Account;
(c) make available additional Sub-Accounts investing in additional funds of
Manufacturers Investment Trust, or another investment company;
(d) eliminate existing Sub-Accounts and stop accepting new allocations and
transfers into the corresponding fund;
(e) operate the Separate Account as a management investment company under
the Investment Company Act of 1940 or in any other form permitted by
law;
(continued)
Page 10
39
SEPARATE ACCOUNT AND SUB-ACCOUNTS (continued)
(f) de-register the Separate Account under the Investment Company Act of
1940;
(g) transfer assets between the Separate Account and other separate
accounts; and
(h) combine Sub-Accounts or to transfer assets in one Sub-Account to
another Sub-Account.
UNIT VALUE CALCULATION. We will determine the unit values for each Sub-Account
as of the end of each Business Day. When we need to determine a Policy Value or
an amount after the end of a Business Day, or on a day that is not a Business
Day, we will do so as of the next Business Day.
The value of a unit of each Sub-Account was initially fixed at $10 for the first
Business Day that an amount was allocated, or transferred to the particular
Sub-Account. For any subsequent Business Day, the unit value for that
Sub-Account is obtained by multiplying the unit value for the immediately
preceding Business Day by the net investment factor for the particular
Sub-Account on such subsequent Business Day.
NET INVESTMENT FACTOR. The net investment factor for a Sub-Account on any
Business Day is equal to (a) divided by (b), where:
(a) is the net asset value of the underlying fund shares held by that
Sub-Account as of the end of such Business Day before any policy
transactions are made on that day; and
(b) is the net asset value of the underlying fund shares held by that
Sub-Account as of the end of the immediately preceding Business Day
after all policy transactions were made for that day.
We reserve the right to adjust the above formula for any taxes
determined by us to be attributable to the operations of the
Sub-Account. Before making any such changes, we will first seek
approval of the Superintendent of Insurance of the State of New York.
SEPARATE ACCOUNT ASSETS. The assets held in each Sub-Account are used to support
variable life insurance policies.
Income, gains and losses of the Separate Account are credited to, or charged
against, the applicable Sub-Accounts without regard to our other income, gains
and losses.
The assets of the Separate Account are our property. The part of the assets that
is equal to the Investment Account values in respect of all Single Premium and
Flexible Premium Variable Life Insurance policies will not be charged with
liabilities from any other business we conduct. We can transfer to our general
account, Separate Account assets in excess of the liabilities of the Separate
Account arising under the Single Premium and Flexible Premium Variable Life
Insurance policies supported by the Separate Account.
INVESTMENT OPTIONS
TRANSFERS. By Written Request you may transfer portions of your Policy Value
among the Investment Accounts and the Fixed Account.
Transfers are subject to the following restrictions:
(a) you can make as many transfers in a Policy Year as you want. There is
no charge for the first twelve transfers in any Policy Year. If you
make more than twelve transfers in any Policy Year, the Transfer Fee
shown in the Table of Values in the Policy Information section will
apply to each subsequent transfer in that Policy Year. We will consider
all transfer requests received on the same Business Day as one
transfer;
(b) you may transfer your Policy Value from any of the Investment Accounts
to the Fixed Account without incurring the transfer charges in (a)
above, provided such transfers occur within:
(continued)
Page 11
40
INVESTMENT OPTIONS (continued)
(1) eighteen months after the Issue Date, as shown in the Policy
Information section of this policy; or
(2) the later of (i) or (ii) below:
(i) 60 days from the effective date of a material change
in the investment objectives of any of the
Sub-Accounts; or
(ii) 60 days from the notification date of any such
change.
(c) the maximum amount that you can transfer out of the Fixed Account in
any one Policy Year is limited to the greater of:
(1) the Fixed Account Maximum Transfer Percentage shown in the
Policy Information section, multiplied by the value in the
Fixed Account at the previous Policy Anniversary; or
(2) the Fixed Account Maximum Transfer Amount shown in the Policy
Information section.
(d) any transfer out of the Fixed Account may not involve a transfer to the
Investment Account for the Money Market Trust;
(e) transfer privileges are subject to any restrictions we or the
Manufacturers Investment Trust may impose; and
(f) transfer privileges may be terminated at any time.
ASSET ALLOCATION BALANCER TRANSFERS. If you elect this option, we will
automatically transfer amounts among your specified Investment Accounts in order
to maintain your designated percentage in each account. We will effect the
transfers six months after the later of the Policy Date and the last Policy
Anniversary, and at each six month interval thereafter.
The maximum Asset Allocation Balancer Charge for transfers under this option is
shown in the Policy Information section of this policy. We will provide you with
90 days written notice of any change in the current amount.
When you change your premium allocation instructions, your Asset Allocation
Balancer will change so the two are identical. This change will automatically
occur unless you instruct us otherwise, or a Dollar Cost Averaging request is in
effect.
We reserve the right to cease to offer this option as of 90 days after we send
you written notice.
DOLLAR COST AVERAGING. If you elect this option, we will automatically transfer
amounts each month from one Investment Account to one or more of the other
Investment Accounts or the Fixed Account. You must select the amount to be
transferred and the accounts.
If the value in the Investment Account from which the transfer is being made is
insufficient to cover the transfer amount, we will not effect the transfer and
we will notify you.
The maximum Dollar Cost Averaging Charge for transfers under this option is
shown in the Policy Information section of this policy. We will provide you with
90 days written notice of any change in the current amount.
We reserve the right to cease to offer this option as of 90 days after we send
you written notice.
POLICY LOAN CONDITIONS
At any time while this policy is in force and has an available loan value, you
can get a loan by Written Request. We may require a loan agreement from you as
the policy is the only security for the loan.
You should consult your tax advisor before making a decision to take out a new
loan.
(continued)
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POLICY LOAN CONDITIONS (continued)
AVAILABLE LOAN VALUE. The available loan value on any date is 90% of the Net
Cash Surrender Value.
Loan amounts that represent Earnings under the policy are considered Preferred
Loans.
LOAN ACCOUNT. When you take out a loan, or when loan interest charges are
borrowed, we will do a transfer from the Fixed Account and/or one or more of the
Investment Accounts into the Loan Account. Amounts we transfer into the Loan
Account cover the loan principal plus loan interest due to the next Policy
Anniversary.
A Loan Sub-Account exists for each Investment Account and for the Fixed Account.
Amounts transferred to the Loan Account are allocated to the appropriate Loan
Sub-Account to reflect the account from which the transfer was made.
You may tell us how much of the amount to be transferred to the Loan Account you
wish to allocate to your value in the Fixed Account and each of the Investment
Accounts. If you do not tell us, we will allocate the amounts to be transferred
in the same proportion that your value in the Fixed Account and the Investment
Accounts bears to the Net Policy Value.
When an amount to be transferred is allocated to an Investment Account, we will
redeem units of that Investment Account sufficient in value to cover the
allocated amount. These transfers do not count as a transfer for the purposes of
the Transfers section of the Investment Options provision.
Interest is credited to the Loan Account and interest is also charged on the
Policy Debt, as described under the Loan Interest Charged and the Loan Interest
Credited sections of this provision.
LOAN INTEREST CHARGED. Interest will accrue daily on loans. In the event that
you do not pay the Loan Interest Charged in any Policy Year, it will be borrowed
against the policy and added to the Policy Debt in arrears at the Policy
Anniversary. We will allocate the amount borrowed for interest payment in the
same proportion that your value in the Fixed Account and the Investment Accounts
bears to the Net Policy Value as of the Policy Anniversary.
The effective annual Loan Interest Charged Rate is shown in the Table of Values
in the Policy Information section.
LOAN INTEREST CREDITED. Interest will accrue daily to amounts in the Loan
Account. The effective annual Loan Interest Credited Rate for Preferred and
other loans is shown in the Table of Values in the Policy Information section.
Should it be determined at any time that a Preferred Loan would become taxable
under applicable federal tax law, ruling, regulation, or court decision because
loan interest is being charged and credited at the same rate, we will increase
the Loan Interest Charged Rate to the extent necessary for the transaction to be
treated as a loan for federal tax purposes. In no event will the new rate exceed
the effective annual maximum rate permitted under state law.
LOAN REPAYMENT. You may repay the Policy Debt in whole or in part at any time
prior to the death of the Life Insured and while the policy is in force.
Repayments will be applied first to the portion of the Policy Debt that is not a
Preferred Loan.
When you repay a loan, we credit the amount to the Loan Account, and make a
transfer to the Fixed Account and/or the Investment Accounts.
We will allocate loan repayments as follows:
(a) first to the Fixed Account, until the associate Loan Sub-Account is
reduced to zero;
(b) then to each Investment Account in the same proportion that the value
in the corresponding Loan Sub-Account bears to the value of the Loan
Account.
While a loan exists, any additional premium payment will be applied first to
repay the Policy Debt.
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SURRENDER AND WITHDRAWALS
SURRENDER OF THE POLICY. You may surrender this policy for its Net Cash
Surrender Value at any time prior to the death of the Life Insured. We will
determine the Net Cash Surrender Value as of the end of the Business Day on
which we receive the policy and your Written Request for surrender at our
Service Office. After we receive your surrender request, no insurance will be in
force.
If You Surrender Your Policy During the Surrender Charge Period, We Will
Deduct a Surrender Charge From Your Policy Value in Calculating the Net Cash
Surrender Value. the Surrender Charge Will Apply to the Amount of Your Policy
Value in Excess of the Free Withdrawal Amount.
PARTIAL NET CASH SURRENDER VALUE WITHDRAWAL. Upon Written Request, you may
withdraw a portion of the Net Cash Surrender Value of your policy as a partial
withdrawal. You may specify the accounts from which we should make the partial
Net Cash Surrender Value withdrawal. If we do not receive such instructions, we
will make the withdrawal in the same proportion that the value in the Fixed
Account and the Investment Accounts bears to the Net Policy Value.
Partial withdrawals will be subject to the following conditions:
(a) they can only be made after the first Policy Anniversary;
(b) we will do the withdrawal as of the end of the Business Day on which we
receive your Written Request;
(c) the partial withdrawal cannot be less than the Minimum Withdrawal
amount specified in the Policy Information section;
(d) we will deduct the applicable Surrender Charge if the partial
withdrawal occurs during the Surrender Charge Period and exceeds the
Free Withdrawal Amount;
(e) the withdrawal will result in a reduction in the Face Amount of
insurance; and
(f) if the withdrawal would cause the Policy Value to fall below the
Minimum Initial Premium shown in the Policy Information section, we
will treat the withdrawal request as a full surrender of the policy.
SURRENDER CHARGE DEDUCTION. We will allocate the deduction of the Surrender
Charge for the withdrawal to the Fixed Account and the Investment Accounts in
the same proportion that the withdrawal from each account bears to the total
withdrawal.
If the withdrawal plus the Surrender Charge allocated to a particular account
are greater than the value of that account, we will reduce the portion of the
withdrawal allocated to that account. We will reduce the allocated portion so
that the withdrawal plus the charge allocated to the account equal the value of
the account.
If the amount in all accounts is not sufficient to pay the Surrender Charge, we
will reduce the amount of the withdrawal.
FACE AMOUNT REDUCTION. The Face Amount after a partial withdrawal will be equal
to (a) multiplied by (b), where:
(a) is the Face Amount prior to the withdrawal; and
(b) is the Policy Value after the withdrawal, divided by the Policy Value
prior to the withdrawal.
The reduction in Face Amount will be effective as of the date of the withdrawal.
If the reduction in the Face Amount would require the return of premiums in
order for the policy to qualify as life insurance under Section 7702 of the
Code, or any other equivalent section, we will return such premiums.
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RIGHT TO POSTPONE PAYMENT OF BENEFITS
We reserve the right to postpone the payment of Net Cash Surrender Values,
partial Net Cash Surrender Value withdrawals, policy loans except when used to
make a premium payment and the portion of the Insurance Benefit that depends on
Investment Account values, for any period during which:
(a) the New York Stock Exchange (Exchange) is closed for trading (other than
customary week-end and holiday closings), or trading on the Exchange is
otherwise restricted;
(b) an emergency exists as defined by the Securities and Exchange Commission
(SEC), as a result of which disposal of securities held in the Separate
Account or determining the value of the Separate Account's net assets is
not reasonably practicable, or the SEC requires that trading be
restricted; or
(c) the SEC permits a delay for the protection of policyholders.
Except when used to make a premium payment, we also reserve the right to
postpone payments for up to six months if such payments are based on values that
do not depend on the investment performance of the Sub-Accounts.
If we do not mail or deliver a requested payment within 10 working days of the
date we receive the documentation necessary to complete the transaction, we will
pay interest from such date at the rate prescribed by the state, provided the
interest is at least $ 25.00. At our option, the interest will either be added
to and become part of the total payment or we will pay it separately.
In addition, we may deny transfers under the circumstances stated in (a), (b)
and (c) above, and in the Transfers section of the Investment Options provision.
SUICIDE
If within two years after the Issue Date, the last to die of the individuals
insured under this policy dies by suicide, the policy will terminate and our
liability will be limited to the Net Premiums Paid.
For purposes of this section, the Net Premiums Paid means:
(a) the premiums paid; less
(b) any partial Net Cash Surrender Value withdrawals; less
(c) the Policy Debt.
Except for the last-to-die, if death is by suicide within two years after the
Issue Date, we will terminate this policy and issue a new policy on the life of
the survivor. The new policy will be issued subject to the following conditions:
(a) the new policy will be the Single Life Modified Single Premium Life
Insurance policy that is available at time of re-issue;
(b) no evidence of insurability will be required;
(c) the Suicide and Validity provision of the new policy will be effective
from the Issue Date of this policy;
(d) we will apply as a premium to the new policy one-half of the Net
Premiums paid under this policy.
(e) the Face Amount of the new policy will be an amount which bears the
same relationship to the premium of the new policy as the Face Amount
of this policy bears to the initial premium.
(f) we will refund to the Owner one-half of the Net Premiums paid under
this policy.
We reserve the right under this provision to obtain evidence of the manner and
cause of death of the Lives Insured.
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BENEFICIARY
The following four sections will apply unless there is a beneficiary appointment
in force that provides otherwise.
BENEFICIARY CLASSIFICATION. You can appoint beneficiaries for the Insurance
Benefit in three classes: primary, secondary and final. Beneficiaries in the
same class will share equally in the Insurance Benefit payable to them.
PAYMENT TO BENEFICIARIES. We will pay the Insurance Benefit:
(a) to any primary beneficiaries who are alive when the Life Insured dies;
or
(b) if no primary beneficiary is then alive, to any secondary beneficiaries
who are then alive; or
(c) if no primary or secondary beneficiary is then alive, to any final
beneficiaries who are then alive.
CHANGE OF BENEFICIARY. Until the Life Insured's death you can change the
beneficiary by Written Request unless you make an irrevocable designation. We
are not responsible if the change does not achieve your purpose. The change will
take effect as of the date you signed such request. It will not apply to any
payments we made or any action we may have taken before we received your Written
Request.
DEATH OF BENEFICIARY. If no beneficiary is alive when the Life Insured dies, the
Insurance Benefit will be payable to you; or to your estate if you are the Life
Insured. Unless otherwise provided, if a beneficiary dies before the seventh day
after the death of the Life Insured, we will pay the Insurance Benefit as if the
beneficiary had died before the Life Insured.
OWNERSHIP AND ASSIGNMENT
Until the Life Insured's death, without the consent of any beneficiary, except
an irrevocable beneficiary, you as owner can:
(a) receive any amount payable under your policy;
(b) exercise all rights and privileges granted by the policy; and
(c) assign the policy.
An assignment does not bind us until we receive it in writing at our Service
Office. We are not responsible for its validity or its effects. It should be
filed with us in duplicate. We will return a copy.
CHANGE OF OWNER. Until the Life Insured's death, the owner can change the
ownership of the policy by Written Request. The change will take effect as of
the date you signed the Written Request. It will not apply to any payments we
made or any action we may have taken before we received your Written Request.
TRUSTEE OWNER. Should the owner be a trustee, payment to the trustee(s) of any
amount to which the trustee(s) is (are) entitled under the policy, either by
death or otherwise, will fully discharge us from all liability under the policy
to the extent of the amount so paid.
JOINT OWNERSHIP. Two or more owners will own the policy as joint tenants with
right of survivorship, unless otherwise requested on the application or in any
subsequent assignment of the policy. On death of any of the owners, the deceased
owner's interest in the policy passes to the surviving owner(s).
Any rights and privileges that may be exercised by the owner, may be exercised
only with the consent of all joint owners.
SUCCESSOR OWNER. Upon the owner's death during the lifetime of the Life Insured,
a named successor owner will, if then living, have all the owner's rights and
interest in the policy. Until the Life Insured's death, the owner, without the
consent of any revocable beneficiary or any successor owner, can cancel or
change the designation of successor owner. This may be done from time to time by
agreement in writing with us.
PROTECTION AGAINST CREDITORS
If permitted by state law, all payments shall be exempt from the debts and
contracts of the owners and beneficiaries, and from seizure by court order.
CURRENCY AND PLACE OF PAYMENT
All payments to or by us will be in U.S. currency. We will make payments from
our Service Office. We may require proof that the person claiming any payment is
entitled to it.
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CONTRACT
The policy, application, supplementary benefits, and any endorsements form your
whole contract. A copy of the application is attached to the policy and deemed a
part of it. We will not be bound by any statement that is not in the application
or the policy.
Only our President or one of our Vice-Presidents can agree to amend or modify
the policy or waive any of its provisions. Any change must be in writing.
Statements made by you or the Life Insured are representations, not warranties.
We will not use any statement by you or the Life Insured to deny a claim, unless
it is written in the application or any supplement to the application.
VALIDITY
We have the right to contest the validity of this policy based on material
misstatements made in the initial application or an application for policy
change that requires evidence of insurability. However, we cannot contest the
validity of your policy after it has been in force during the lifetime of at
least one of the Lives Insured for two years from the Issue Date, or the
effective date of a policy change that required evidence of insurability.
We can contest after two years if the policy has been reinstated and has been in
force during the lifetime of at least one of the Lives Insured for less than two
years from the reinstatement date. If this is the case, we can only contest the
validity in respect of any fact material to the reinstatement that was
misrepresented.
NON-PARTICIPATING
Your policy is non-participating. It does not earn dividends.
AGE AND SEX
If the Age or Sex of a Life Insured was misstated in the application, we will
change the Face Amount of insurance. The new Face Amount will be determined so
that the Death Benefit will be that which the most recent Cost of Insurance
deduction would have purchased for the correct Age and Sex.
CONVERSION PRIVILEGE
By Written Request, you may convert your policy to a fixed paid-up benefit at
any Policy Anniversary, without evidence of insurability.
The conversion is subject to the following conditions:
(a) no further Monthly Deductions will be taken from the Policy Value after
the date of conversion;
(b) the Death Benefit, the Policy Value, other values based on the Policy
Value, and the Investment Account values will be determined as of the
Business Day on which we receive your Written Request for conversion;
(c) the fixed paid-up benefit is determined by dividing the Net Cash
Surrender Value by the net single premium. The basis for determining
the net single premium and Policy Value will be the Commissioners 1980
Standard Ordinary Smoker or Non-Smoker Mortality Table and an interest
rate of 4% per year; and
(d) the Modified Single Premium SurviorshipVariable Life coverage cannot be
reinstated after the date of the conversion.
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FLEXIBLE FACTORS
When determining the rate of interest to be used in crediting interest to the
portion of the Policy Value in the Fixed Account, and any changes in that rate,
we will consider the following factors: expected mortality and persistency
experience; expected general account investment earnings; and expected operating
expenses. We will consider the same factors when we determine the actual cost of
insurance; the deductions for tax load; administrative charges; and whenever
changes are made to any of these charges. We will not try to recover any losses
in earlier years by increasing your charges in later years.
Adjustments to flexible factors will be by class and be determined by us from
time to time based on future expectations for such factors. Any change will be
determined in accordance with procedures and standards on file with the
Superintendent of Insurance of the state of New York.
HOW VALUES ARE COMPUTED
We provide Cash Surrender Values that are at least equal to those required by
law. A detailed statement of the method of computing the values of this policy
has been filed with the insurance department of the state in which this policy
is delivered.
We use the Commissioners 1980 Standard Ordinary Smoker/Non-Smoker Mortality
Table in computing reserves, and in determining Maximum Cost of Insurance Rates.
Values relating to amounts in the Fixed Account are computed at the Minimum
Guaranteed Annual Fixed Account Rate shown in the Table of Values in the Policy
Information section.
Current cost of insurance rates and the current interest rate being credited to
the Fixed Account will be reviewed at least once every five Policy Years, but we
will not make a change more than once each Policy Year.
ANNUAL STATEMENT
Within 30 days after each Policy Anniversary, we will send you a report showing:
(a) the Death Benefit;
(b) the Policy Value;
(c) the current allocation of money in the Fixed Account, the Loan Account
and each of the Investment Accounts;
(d) the value of the units in each chosen Investment Account;
(e) any Loan Account balance and loan interest charged since the last
report;
(f) the premiums paid and policy transactions for the year; and
(g) any further information required by law.
TAX CONSIDERATIONS
It is the intent that this policy be considered as life insurance for tax
purposes, to comply with Section 7702 of the Code, or any other equivalent
section. We reserve the right to limit the amount of premiums paid for this
policy, or to make any other reasonable adjustments to the terms or conditions
of this policy if it becomes necessary to allow it to qualify as life insurance.
This provision should not be construed to guarantee that the policy will be
treated as life insurance or that the tax treatment of life insurance will never
be changed by the future actions of any tax authority.
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[MANULIFE FINANCIAL LOGO]
MANULIFE FINANCIAL
THE MANUFACTURERS LIFE INSURANCE
COMPANY OF NEW YORK
MODIFIED SINGLE PREMIUM SURVIVORSHIP VARIABLE LIFE INSURANCE.
Benefit payable on the earlier of the death of the last survivor or the Maturity
Date.
Policy Values allocated to an Investment Account reflect the investment
experience of the underlying Sub-Accounts. Investment options are described in
the "Policy Value Composition" and the "Investment Options" provisions.
Non-participating (not eligible for dividends).
IMPORTANT NOTICE
To claim a benefit or request a change in your
policy, contact our nearest representative or
write to our Service Office at the address below.
Please tell us promptly of any change in your
address.
WE STRONGLY URGE THAT, BEFORE YOU TAKE ANY ACTION
TO REPLACE THIS OR ANY OTHER POLICY, YOU ASK THE
ADVICE OF THE COMPANY THAT ISSUED THE POLICY.
[GRAPHIC WRITING OF THE WORD "EXHIBIT" ACROSS TEXT]
Service Office Mailing Address:
The Manufacturers Life Insurance Company of New York
P.O. Box 633
Niagara Square Station
Buffalo, NY 14202-0633
Toll Free Number: 1-888-267-7784
Manulife Financial and the block design are registered service marks of The
Manufacturers Life Insurance Company and are used by it and its subsidiaries.
48
SUPPLEMENTARY BENEFIT
LAPSE PROTECTION BENEFIT
This benefit is a part of your policy. Should any provisions in your policy
conflict with this benefit, the provisions of this benefit will prevail.
EFFECTIVE DATE
The benefit takes effect on the Policy Date shown in the Policy Information
section.
BENEFIT
If the Net Cash Surrender Value of your policy falls to zero or below, this
benefit prevents your policy from going into default provided that there is no
Policy Debt.
The duration of the Lapse Protection Benefit is shown in the Policy Information
section of the policy.
TERMINATION
The benefit terminates on the earlier of the following dates:
(a) the end of the Lapse Protection Benefit period; or
(b) the date the policy terminates.
The benefit can be reinstated with your policy.
THE MANUFACTURERS LIFE INSURANCE COMPANY OF NEW YORK
/s/ James W. Gallagher
President
[GRAPHIC WRITING OF THE WORD "EXHIBIT" ACROSS TEXT]