LifeFund. Life s biggest financial. questions answered. in one LifeFund. Now, go live. A living life plan. Equity Index. Life Insurance Policy M3413

Transcription

1 Life s biggest financial questions answered in one LifeFund. Now, go live. Equity Index LifeFund A living life plan. SM M343 Page of 2

2 Equity Index LifeFund Life insurance for the 2st century. Traditional life insurance is behind the times. An insurance policy that pays only when you die may have met your needs in the 20th century, but it falls short of meeting your financial needs in the 2st century. Now there s an alternative a brand new kind of life insurance. It s called Equity Index LifeFund SM from Allianz Life, the first insurance policy truly designed for the way you live today. What if I have an accident and a serious injury keeps me from working? You know that during life you may experience unwelcome, uncontrollable events: heart attack, stroke, cancer, accidents, even death of a spouse or child. While you can t always prevent or even predict these tragedies, this product gives you a resource to control their effect on your life. How will I pay bills during my recovery? What if I have a heart attack or get cancer? How will I cover the costs of treatment and still take care of my family? Sure, Equity Index LifeFund pays if you die. But it s more than simple life insurance. It also meets the more immediate risks: What if I have an accident and a serious injury keeps me from working? How will I pay bills during my recovery? Or what if I have a heart attack or get cancer? How will I cover the costs of treatment and still take care of my family? Insurance coverage is just the beginning. Equity Index LifeFund also lets you build cash value to help prepare for retirement. Not only can you share in potential market index growth, but if you choose lifetime payments when you retire, you can receive even more retirement income. Simply stated, Equity Index LifeFund is the first life insurance policy that makes you the beneficiary. It provides simple, comprehensive protection for wherever life takes you. If you qualify for chronic illness or disability benefits, you have access to your LifeFund. If you die unexpectedly, your Equity Index LifeFund provides for your family. And, when you re ready to retire, provides income you may never outlive. With Equity Index LifeFund here to cover the tough financial questions, you have more time to answer: What have I always wanted to do? Now, go live. Equity Index LifeFund is a flexible premium adjustable life insurance policy. Index Benefit increases, up to an annual maximum, are credited to your accumulation value at the end of each policy year. If the index performance is not sufficient to increase the accumulation value, no adjustment will be made. The minimum guaranteed interest rate is 3% to the Interest Earning Value. Past performance does not guarantee future results. Surrender charges apply to the accumulation value for a period of 5 years. To qualify for the Preferred Settlement Value, a form of life income must be selected after the later of 0 years or age 55. A higher Preferred Settlement Value is available by holding the policy the later of 5 years or age 65 and selecting a form of life income. The expiration date to select the Preferred Settlement Value is the later of the policy anniversary after age 70 or end of the 6th policy year. Equity Index LifeFund issued by Allianz Life Insurance Company of North America (generic forms P600N with PE084, PE085 and PR0N). Page 2 of 2

3 Taking care of your family If you die, your named beneficiary will receive the death benefit of your policy, less any benefits you ve already received. Your beneficiary can receive the death benefit in one lump sum or choose from a variety of settlement options. If your beneficiary takes the payments over time (minimum of 0-year certain), he or she may receive 0% of the death benefit. Equity Index LifeFund also provides an Accelerated Benefit for the death of a spouse or child. If your spouse dies, you can take up to 25% of the LifeFund to a maximum of $50,000. If one or more of your children dies, you can receive up to 0% of the LifeFund in a lump-sum payment to a maximum of $0,000 per child. Helping you enjoy a fulfilling retirement Equity Index LifeFund is more than financial protection in case something happens. It can also provide you a stream of retirement income you may not outlive. Choosing how you build your cash value Equity Index LifeFund gives you three options for allocating your premium, putting the power to diversify in your hands. Maybe you want to increase your chance for a higher gain by sharing in potential market index growth, or maybe you would rather rely on a fixed interest rate. The choice is yours. You also have the freedom to reallocate your money every year. You can allocate your premium among: The S&P 500 Index, The Nasdaq-00 Index, 2 and/or A fixed interest rate. When assigning premium to either market index, you can share in potential gains up to an annual maximum. Your guaranteed policy values will not be reduced because of a market fluctuation. Standard & Poor s, S&P, S&P 500, Standard & Poor s 500, and 500 are trademarks of The McGraw-Hill Companies, Inc. and have been licensed for use by Allianz Life Insurance Company of North America. The product is not sponsored, endorsed, sold or promoted by Standard & Poor s and Standard & Poor s makes no representation regarding the advisability of purchasing the product. 2 Nasdaq, Nasdaq-00 and Nasdaq-00 Index are trademarks of The Nasdaq Stock Market, Inc. and have been licensed for use by Allianz Life Insurance Company of North America. The product has not been passed on by the Corporations as to its legality or suitability. The product is not sponsored, endorsed, sold or promoted by The Nasdaq Stock Market, Inc. THE NASDAQ STOCK MARKET, INC. MAKES NO REPRESENTATION REGARDING THE ADVISABILITY OF PURCHASING THE PRODUCT. Page 3 of 2

4 Equity Index LifeFund: coverage for life s risks Equity Index LifeFund offers much more than simple life insurance. This living life plan provides a death benefit, but it s also a pool of money that helps cover financial difficulties brought on by illness or disability. Receive cash benefits when you need them the most. You can use a portion of your LifeFund if you become critically or chronically ill or disabled. Depending on your qualifying illness or disability, you will receive a percentage of your LifeFund: If you become critically ill, you can receive up to 50% of your LifeFund. If you become chronically ill, you can receive up to 0% of your LifeFund annually in the form of monthly payments. If you become disabled and are receiving Social Security disability benefits, you can receive % of your LifeFund every month to age 65. Benefits received may total up to 90% of your initial Specified Amount and under certain circumstances may exceed 90%. You re paid in cash, and can use the money however you wish. And you don t have to coordinate or assign benefits with other insurance plans. Better still, during the time of illness, Allianz Life waives the premium for your Equity Index LifeFund (subject to limitations). 2 You are considered chronically ill if you have a permanent and total disability that prevents you from performing two of six Activities of Daily Living (bathing, continence, dressing, eating, toileting, and transferring) without assistance. Page 4 of 2

5 Critical illness: Benefits are based on diagnosis of your illness and are determined as a percent of the initial LifeFund. You do not have to be terminally ill to receive benefits. Critical Illness Maximum Benefit Amount ALS (Lou Gehrig s Disease) 50% Blindness 50% (total and permanent in both eyes) (00% if accidental) Cancer 50% (Excludes: Carcinoma In-Situ, pre-malignant tumors, Stage Hodgkin s, papillary cancer of the bladder, Stage A & B prostate cancer, Duke s A colorectal cancer, and all skin cancers except invasive malignant melanomas) End stage renal failure (failure of both kidneys) 50% Organ transplant 50% (lung, heart, liver, kidney, bone marrow, or pancreas) Paralysis (two or more limbs) 50% Stroke 50% (resulting in permanent paralysis or neurological damage remaining more than 90 days) Hearing loss 25% (total and permanent in both ears) (50% if accidental) Major heart attack 2 25% Minor heart attack 2 0% In order for benefits to be payable, the policy must be in force at the time of occurrence. 2 A minor heart attack is indicated by chest pain, EKG changes, and elevation of cardiac enzymes. A major heart attack is indicated by chest pain, EKG changes, elevation of cardiac enzymes, and ejection fraction of less than 35%. 3 Page 5 of 2

6 Hypothetical examples S&P 500 Hypothetical example of participation in growth of the S&P 500 Index from 2/3/983 2/3/2003. Assumes 45-year old male, SuperSelect nonsmoker, $00,000 face amount/death benefit, monthly premium of $07.67 ( annualized premium), 00% participation rate, 2% cap, 00% of premium allocated to the S&P 500. Based on monthly average return. Assumes Equity Index LifeFund has been available since 983. Past performance does not guarantee future results. Year Annualized premium Accumulation value $625 $,347 $2,38 $3,003 $3,836 $4,895 $5,432 $6,622 $7,095 $7,825 $8,23 $9,557 $0,773 $2,34 $3,98 $5,258 $5,309 $5,269 $5,27 $6,370 Net cash value $303 $,36 $2,95 $2,732 $3,922 $4,395 $5,26 $6,053 $7,937 $9,693 $,774 $3,98 $5,258 $5,309 $5,269 $5,27 $6,370 Preferred Settlement Value $303 $,36 $2,95 $2,732 $3,922 $4,395 $7,688 $9,079 $,905 $4,539 $7,66 $20,972 $22,887 $22,963 $22,903 $22,690 $49,07 Monthly average of S&P 500 return -2.80% 2.99% 3.08% 8.0% 8.49% 7.50% -5.86% 5.54% 0.0% 4.07% -.24% 9.08% 9.57% 8.24% 2.0% 8.25% -3.37% -0.9% -3.89% 0.0% S&P 500 participation (based on cap) 0.00% 8.49% 0.00% 0.0% 4.07% 0.00% 9.57% 8.25% 0.00% 0.00% 0.00% 0.0% 4 Page 6 of 2

7 Having access to your money now With Equity Index LifeFund, you are covered in those times when you might need money quickly. You can take a policy loan against the cash value of your policy, then pay it back at a competitive interest rate. Or, you can take part of your net cash value in a lump sum (surrender charges may apply and your Indexed Benefits will not be credited). Equity Index LifeFund even helps out if you become unemployed, by providing a free unemployment benefit with your policy. After the first policy year, if you re younger than 65 and unemployed for more than 80 days, you can either: Take up to 25% of the unloaned accumulation value in a single partial surrender without paying any surrender charge, or Borrow up to 50% of your net cash value in a single loan, repayable at a very low interest rate for three years. Turning your cash value into a generous retirement income stream. Living longer is good news, but it also brings a big financial concern: How will I prepare for my retirement? To help you meet that need, Equity Index LifeFund features a lifetime income retirement benefit a stream of income that is guaranteed to live as long as you do. Just look at these possibilities for a financially secure retirement. If you ve had the Equity Index LifeFund for 0 years or you reach age 55, whichever is later, the total amount you can receive as retirement income value (Preferred Settlement Value) will be.5 times the net cash value. 2 So if your net cash value is $00,000, for example, your policy value available for lifetime income will increase to $50,000! If you continue to pay your premiums for a minimum of 5 years, or to age 65, whichever is later, the amount you can receive as retirement income (Preferred Settlement Value) increases to three times your net cash value. 2 This means, at age 65 for example, if your net cash value is $00,000, your policy value available for lifetime income will increase to $300,000! Not available in all states 2 Accumulated excess premium is included in the Preferred Settlement Value without the enhancement factor. 5 Page 7 of 2

8 Answering your questions Is Equity Index LifeFund insurance? Yes. Equity Index LifeFund is a completely new type of life insurance protection. In addition to LifeFund benefits for specific qualifying critical illness and chronic illness, there is a death benefit in the event the insured dies prior to selecting retirement income. The death benefit (Specified Amount) can be kept in effect as long as premiums are paid and retirement income is not selected. Who can own the policy? The Equity Index LifeFund policy may be owned by the insured or by a third party. If you are the policyholder, but are not the insured, then upon your death the policy ownership passes to the executor of your estate or to the contingent policyholder if one is listed on the application, or subsequently added. Is there a minimum premium required to purchase the policy? Yes. The minimum premium for Equity Index LifeFund is $50 per month (or $600 annually). How does Equity Index LifeFund protect in the event of death? The death benefit is paid to your named beneficiary in a lump sum, unless you or your beneficiary chooses a settlement option. Settlement options include: Guaranteed period (0-year certain or longer will be based on 0% of the death benefit) Life with a guaranteed period (based on 0% of the death benefit) Benefit deposited with interest Installments of a selected amount Joint and survivor annuity What protection does Equity Index LifeFund offer? Equity Index LifeFund pays your named beneficiary a death benefit upon your death. A portion of the LifeFund is available for use during qualifying critical or chronic illnesses, disability or the death of a spouse or child(ren). It also offers tax-deferred cash accumulation and a unique Preferred Settlement Value to fund a secure retirement. What are LifeFund benefits? LifeFund benefits are paid as an acceleration of the death benefit. When a benefit is paid, the death benefit and cash value are reduced by a proportionate amount. How would I receive Waiver of Premium Credits? During the time of illness, Allianz Life waives the premium for your Equity Index LifeFund. Prior to age 65, we will credit the waived premium to your accumulation value on the next monthly anniversary date after: A benefit of 50% or greater is paid for a one-time lump-sum benefit, or You have received your first payment for a monthly benefit claim. 6 Assumes the policyholder is also the insured. Page 8 of 2

9 What is a chronic illness? A chronic illness is the inability to perform, without assistance, two of six specific Activities of Daily Living with a minimum waiting period of 90 days. The Activities of Daily Living are bathing, continence, dressing, eating, toileting, and transferring. For a qualifying chronic illness, 0% of LifeFund is paid as monthly income each year for as long as the disability lasts or until 90% of the initial Specified Amount has been paid for Accelerated Benefits. What proof is required for a benefit payment? A benefit payment requires written diagnosis by a licensed physician with supporting documentation. For disability benefits, proof that you are receiving Social Security disability benefits is required. What can a benefit payment be used for? Benefit payments can be used for any purpose. There are no restrictions and no coordination or assignment of benefits with other insurance plans. Does Equity Index LifeFund offer a retirement benefit? Yes. With Equity Index LifeFund you can build your policy values to help prepare for your retirement. Based on planned premium, it offers a Preferred Settlement Value equal to 50% of the net cash value for monthly income. This income is available after holding the Equity Index LifeFund for 0 years or reaching age 55, whichever is later. After 5 years or age 65, whichever is later, the Preferred Settlement Value grows to 300% of the net cash value based on planned premiums. Any accumulated excess premium payments are added to the Preferred Settlement Value after the factors are applied. When retirement income is selected, Accelerated Benefits (including spouse and child benefits) are no longer available. What are my retirement income options? Equity Index LifeFund offers a full range of retirement income options, from a 5-year period certain, to life only, and life with a period certain. You can receive payments monthly, quarterly, semiannually or annually. These options provide flexibility to meet your individual needs. To receive the Preferred Settlement Value, you must select a form of lifetime retirement income before 6 policy years or age 70, whichever is later. Page 9 of 2 Do LifeFund benefit payments ever have to be repaid? No. Benefit payments are not loans, so there are no interest charges or penalties and they are never repaid. However, when a benefit is paid, your policy s death. Are Equity Index LifeFund benefits taxable? Equity Index LifeFund death benefits and waiver of premium are income tax-free. The LifeFund benefits offered under this policy are intended to qualify for favorable tax treatment under the Internal Revenue Code of 986. If the LifeFund benefits qualify for such favorable tax treatment, the benefits will be excludable from your income and not subject to federal taxation. Tax laws relating to LifeFund benefts are complex. You are advised to consult a qualified tax advisor about circumstances under which you could receive LifeFund benefits excludable from income under federal law. What about pre-existing conditions? Pre-existing conditions are defined as any covered condition that occurs within 30 days after the policy effective date, and for which medical treatment or advice was given or recommended during the six months prior to the policy effective date. Benefits will not be paid on pre-existing conditions. 7

10 What is the S&P 500 Index? The Nasdaq-00 Index? The S&P Composite Stock Price Index (S&P 500 Index) is a market value-weighted index of 500 common stocks traded on every major U.S. stock exchange. The 500 companies tend to be leading companies from leading industries. Often used as a benchmark for economic growth, the S&P 500 is compiled daily by Standard & Poor s, a division of The McGraw-Hill Companies. The Nasdaq-00 Index includes the 00 largest nonfinancial market capitalization companies on The Nasdaq Stock Market, across all nonfinancial market sectors. The Nasdaq-00 Index was rebalanced in 998 to a modified market capitalization-weighted index. What is planned premium? Planned premium is the amount of premium based on Equity Index LifeFund insurance rates. Premium paid above planned premium is considered excess premium. How is my premium credited to my policy s accumulation value? Your total planned premium in each year will be allocated to each of your options, according to your allocation choices. The monthly deductions necessary to keep your policy in force will be deducted in the same proportion as your chosen allocation percentages, on each monthly anniversary date. If you share in market index gains, those benefits will be credited at the end of each policy year. How is additional premium credited? Premium paid in excess of your planned premium each year will be credited to your interest earning value. At the end of each policy year, you can allocate your current accumulation value to each of the options as you wish, in increments of 25%. How are my policy values affected by the performance of the S&P 500 or the Nasdaq-00? Index Benefit increases are based on the monthly average performance of the S&P 500 Index and/or Nasdaq-00 Index over each policy year. In other words, index growth is measured monthly during each policy year. 00% of its average growth, up to an annual maximum (the cap), is credited to the accumulation value at the end of each policy year. Policy values will not be reduced because of a market correction. 8 Page 0 of 2

11 What is the minimum guaranteed interest rate? The interest rate credited prior to election of retirement income is guaranteed to never go below 3%. What is the cap? The cap establishes the maximum that you can share in index market gains. The cap assigned on the date your policy is issued is guaranteed to remain unchanged for one policy year. Beginning in the second policy year, the cap is declared annually and is guaranteed for one policy year. The cap will never be less than 3%. Are policy loans available? Yes. A portion of the cash accumulation may be taken as a loan at any time with a 6.54% interest charge in advance. The loan is credited back at 4% upon repayment with potential index gains. What if I become unemployed? After the first policy year, if you re younger than 65 and unemployed for more than 80 consecutive days (providing proof of unemployment), you can either: Take up to 25% of the unloaned accumulation value in a single partial surrender without paying any surrender charge, or Borrow up to 50% of your net cash value in a single loan for three years, at a very low interest rate. This interest rate is locked in for three policy years. What if I want to cash out my Equity Index LifeFund SM? You may request a full or partial surrender at any time for the net cash surrender value. Are there surrender charges? Surrender charges are applied for 5 years to the cash value when taken in a lump sum. It s important to note that no charges are applied to benefit payments for qualifying critical illness, chronic illness, or disability. Are there any premium charges? There is a nominal charge for all premiums paid, defined as a percent of premium. Once the percentage is declared, it is guaranteed to never increase. Are exchanges allowed? Yes. Tax-free 035 exchanges are accepted. How will I know the value of my policy? You will receive an annual statement at the end of each policy year. Your statement will report all activity, including premium received, interest earned, benefits received, loans, and current policy values. Thank you for choosing Equity Index LifeFund. Page of 2

12 Our top priority is the safety of your money All policies are issued by Allianz Life Insurance Company of North America, a member of the Allianz Group. With over 700 subsidiaries in more than 70 countries, the Allianz Group is one of the world s leading providers of integrated financial services. Our goal is to provide policyholders with wealth management products that can help meet today s needs and financial objectives, with a product philosophy of offering fair and equitable values on each policy we issue. Foremost in our minds is the safety of the money you entrust to our care. Allianz Life has consistently been assigned financial strength ratings by Standard & Poor s and A.M. Best that are among the highest available. It is one of a select group of major insurance companies to receive such high ratings. These independent agency ratings are based on an analysis of financial results and evaluation of management objectives and strategies. The ratings do not indicate approval by the analysts and are subject to change. Innovative products, exceptional customer service, and sound financial strength make Allianz Life the place to turn to help meet your retirement objectives. Policies are issued by Allianz Life Insurance Company of North America (generic form number P600N with PE084, PE085 and PR0N). Agent name: License number: Allianz Life Insurance Company of North America PO Box Minneapolis, MN / Product availability and benefits may vary by state (R-9/2004) Page 2 of 2