INTELLIGENT LIFE INSURANCE

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1 This brochure will provide you a guide on how to financially prepare for whatever the future might hold. INTELLIGENT LIFE INSURANCE Create a flexible, personal risk insurance solution Life insurance can safeguard you against the financial impact of a particular risk you may face during the course of your life. Discovery Life is the intelligent choice to meet your exact needs as they change throughout your life, adapting to the external environment and your personal needs.

2 THERE ARE A NUMBER OF FACTORS TO CONSIDER WHEN YOU ARE THINKING OF TAKING OUT LIFE INSURANCE The Discovery LIFE PLAN has been designed to offer you flexible, personal and business financial protection at a cost-effective premium to suit your needs. In this brochure we aim to provide you with a better understanding of the protection you need and what you need to consider when structuring your life insurance. Things to keep in mind include: Which life insurance provider can offer the most relevant cover at a cost-effective premium? (2) This section introduces you to Discovery Life and highlights some of our product innovations. What needs should my insurance policy meet? (4) This section will provide information on the Discovery Life benefits which have been designed to safeguard you against the financial impact of a particular risk you may face during your life. Will I be able to access my life insurance cover if I need to? (6) Discovery Life is the only life insurance company to allow clients to access their life insurance. This section explains how this unique patented benefit works. Will I be able to leave a legacy? (7) Discovery Life s Philanthropy FUND is a non-profit benefit which allows you to leave a lump sum to your choice of charities when you die and to make a contribution every five years to these charities. How much cover do I need? (8) This section will provide information on what you need to consider when deciding how much cover you need. How can I maximise my cover at the lowest price? (9) This section will provide information on increasing your LIFE FUND at a discounted rate, protecting your policy against the harsh effects of adverse economic events, and boosting your risk benefits at no additional cost. How can I reduce my monthly premiums? (12) This section will provide information on integrating your LIFE PLAN if you are a Vitality member, have a Discovery Health Plan or if you have a DiscoveryCard. How can I ensure that my premium is sustainable? (14) This section provides information on the range of premium payment options. Keep in mind that the best way to determine the level of financial security you need is to examine the different types of insurance with a financial adviser. You should also determine the advantages each one holds for you before making a choice. For more detailed information refer to the individual product brochures and technical guides available on 1

3 WHICH LIFE INSURANCE PROVIDER CAN OFFER THE MOST RELEVANT COVER AT A COST EFFECTIVE PREMIUM? Discovery Life is part of the JSE-listed Discovery Group, a multi-national financial services company with operations in South Africa, the United Kingdom, the United States and China. It was the first life assurer to separate risk assurance from investment when it launched in Today this is the market standard, resulting in a saving of at least R5 billion for South African consumers over the past 10 years. We provide unique and comprehensive product solutions The Discovery LIFE PLAN has been designed to offer you a structured solution to meet your individual needs. Every component is designed to safeguard you against the financial impact of a particular risk you may face during your life. We allow you access to your life insurance cover in times of need With Discovery Life s unique AccessCover and AccessCover PLUS benefits you will be able to convert your life cover into immediate cash at a pre-defined conversion rate if you need to. access FAmily We offer protection for the family Discovery Life s Severe Illness Benefit provides automatic severe illness cover for your children and parents at no extra cost. On the Income Continuation Benefit you can select the Family Protector which covers your family for life-changing events. whole body We cover your whole body system The Severe Illness Benefit covers all major body systems, for example the cardiovascular system and nervous system. We provide cover for an extensive list of conditions and if a condition is not on the list, the objective Activities of Daily Living criteria is used to pay appropriately for these conditions. global We offer global protection Whether you want access to the best medical treatment in the world or the latest medical technology, our Severe Illness Benefit and Global Health Protector will assist you with the necessary funding. Through the Global Education Protector your children will have the opportunity to study at top international universities like Harvard, Yale and Oxford if you die, become permanently disabled or suffer a severe illness. Our Global Linkage Benefit and Financial Integrator allow you to protect your cover in global currencies. INCREASE COVER You can increase your cover without underwriting If you purchase the FUTURE FUND at the start of your policy you can increase your cover as your insurance needs change. This can be done without any further underwriting, except a negative HIV test. STAYING RELEVANT Your benefits automatically change according to your changing needs The Capital Disability Benefit converts to the Severe Illness Benefit after age 65 or 70 to ensure protection when the incidence of illness is highest. At the benefit expiry age, the Global Education Protector will convert to extra life cover, disability cover and severe illness cover. The Financial Integrator pays out a cash lump sum and protects you from interest rate increases, under-performance of asset growth and adverse exchange rate movements. 2

4 We pay claims quickly and fairly At Discovery Life we take the payment of claims seriously. Our aim is to always to save you from unnecessary worry by making sure that your claim is assessed and settled quickly and fairly. We maximise your benefits and allow you to manage your premiums Each of our businesses can offer financial protection to suit your family s needs. Through integration with Discovery you are able to realise real value. EFFICIENCY paid quickly THE VALUE OF INTEGRATION Structure your LIFE PLAN The CoverBooster TM and BenefitBoosters allow you to receive additional risk cover if you structure your policy efficiently, at no additional premium. objectivity Objectivity is guaranteed when we assess claims We use objective claim definitions that look at the lifestyle impact of a disease so that you can be sure that your payout will meet your needs. Claims are paid quickly multiple claims We pay for multiple claims Through our unique pro-active claims service, we can identify when a Discovery Health member with a LIFE PLAN may be eligible for a claim. We also pioneered Smart Claims to help your claim by assessing claims on site (at home or in hospital) and by collecting the relevant documents. You can protect your LIFE FUND so that it never drops below a minimum specified level. With the Minimum Protected FUND you can ensure that your cover lasts your entire life, regardless of how many times you claim. If you don t have the Minimum Protected FUND you can also enjoy multiple claims, as long as there are funds available in your LIFE FUND. You can realise real value If you have a Discovery Health Plan, are a Vitality member or have a DiscoveryCard, you can integrate these products with your Discovery LIFE PLAN and enjoy an initial premium discount, have the opportunity to earn a PayBack every five years and the ability to control your premium over time. If you are a member of VitalityDrive you can get additional cover at no additional premium. If you have an Endowment Plan, with Discovery Invest you may qualify for up to 100% discount on all fees or up to 26% upfront boost to your investment value. 3

5 WHAT NEEDS SHOULD MY INSURANCE POLICY MEET? Provides a lump sum amount to protect your family s financial security in the event of your death. You can insure your lifestyle against the impact of severe illness. This means if you get severely ill you will receive a lump sum payout. The Discovery LIFE PLAN has been designed to offer you flexible, personal financial protection at a cost-effective premium to suit your needs. Allows you and your family early access to your life cover for a full range of life-changing events and upon reaching certain age milestones. Discovery Life s Capital Disability Benefit provides a lump sum to ensure you remain financially secure if you become disabled. INCOME CONTINUATION BENEFIT The Discovery Life Income Continuation Benefit allows you to insure your monthly income, so you can maintain your standard of living if you are not able to earn an income due to an injury or illness. In addition, the Overhead Expenses Benefit ensures your monthly business expenses are met under these conditions. If you suffer a life-changing event such as severe illness, disability or death we will pay for the education of your children. 4

6 SUPPLEMENTARY CANCER PROTECTOR Discovery Life s Health Plan Protector covers the cost of your family s Discovery Health medical scheme contributions for up to 10 years. Protects you from the financial strain of unanticipated non-medical costs associated with cancer. We cover you and your family for certain procedures not performed in South Africa or where your chances of survival are significantly higher if performed in the USA. Discovery Life s Philanthropy FUND is a non-profit benefit that allows you to make a contribution to your choice of charities every five years and to leave a lump sum to these charities when you die. Together, these benefits combine to form the Discovery LIFE PLAN, which covers the entire spectrum of financial and health risks you may face to create a flexible, personal solution at a cost-effective premium. Within the Discovery LIFE PLAN, the level of protection differs between the Classic LIFE PLAN and the Essential LIFE PLAN. The Classic LIFE PLAN is designed to provide the most comprehensive and efficient long-term protection for you and your family. The Essential LIFE PLAN provides cost-effective protection for a defined level of cover for you and your family. 5

7 WILL I BE ABLE TO ACCESS MY LIFE COVER BEFORE I DIE IF I NEED TO? With Discovery Life s unique AccessCover Benefit, you will be able to convert your life cover into an immediate payout at a pre-defined conversion rate for a range of life-changing events. ACCESSCOVER BENEFIT Discovery Life s AccessCover is an automatic benefit on all policies with life cover if you meet certain underwriting criteria. Why would I need access to my life cover early? People s needs and circumstances are changing constantly. For this reason it is very difficult to predict exactly how much cover you will need if something happens to you or your family. In particular with the emergence of new medical technologies, people are living longer and are more exposed to impairments at older ages than ever before. The result is a general risk of being under-insured in the event of severe illness or disability and therefore requiring access to funds at a time when you are most exposed. Which events will allow me to convert my life cover into cash? AccessCover is available on diagnosis of a wide range of life-changing medical events. You may also purchase the AccessCover PLUS benefit which will allow you to convert your life cover into immediate cash at an enhanced rate as well as on the following events: If you, your spouse or any of your children become disabled as a result of an accident or violence. If your spouse dies because of an accident or violence. If you reach the age of 80 (or older) and need access to your life cover to supplement your retirement income. The amount of life cover you can convert will depend on the life-changing event as well as whether you have other qualifying benefits on your LIFE PLAN. Making sure my cover is sufficient If you choose to convert your cover into cash through the AccessCover benefit, your cover will reduce for future claims. It is important to speak to a financial adviser to understand the implication this decision may have on your future cover and on estate planning. 6

8 WILL I BE ABLE TO LEAVE A LEGACY? PHILANTHROPY FUND TM The Discovery Life Philanthropy FUND is a non-profit initiative that provides significant payouts to the charities of your choice every five years and when you die. How the Philanthropy FUND works With Discovery Life you can choose to add a Philanthropy Fund TM of up to % of your Discovery LIFE PLAN. This will be donated to your choice of charities when you die. Every five years Discovery Life will pay up to 70% of your premiums to your chosen charities, based on your Vitality status as shown below: With Discovery Life s Philanthropy FUND you are able to use your LIFE PLAN to leave a real legacy. Level of Engagement Non-Vitality Blue Bronze Silver Gold 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Diamond Philanthropy PayOut Percentage You may receive a tax certificate giving you full tax deductibility for the amounts paid to your chosen charities for the five-yearly Philanthropy PayOut. You can choose up to 10 charities from a comprehensive list of approved Section 18A charities. 7

9 HOW MUCH COVER DO I NEED? How your cover should increase over time You will need to consider if your cover must stay level or grow each year. This is an important consideration to ensure the payout is enough if you ever need to claim. You can have your benefits increase every year at the consumer price index (CPI) or a fixed percentage. Ensure the level of your cover will never drop below a minimum level even if you claim You can prevent yourself from running out of cover through the Minimum Protected FUND. This benefit allows you to specify a minimum level for your LIFE FUND. Your LIFE FUND will never drop below this minimum protected level-no matter how many benefit payments have been made or what the value of the payments were. You must decide how much life cover you need. This amount will become your LIFE FUND, the financial mechanism of your LIFE PLAN. You need to take into account all your current financial commitments and those you will have in the future, to work out how much life cover you need. Your financial adviser will be able to assist you with this. At Policy Inception It is important to consider the impact of an increase in the cost of living on your life insurance benefits. You can choose to have your benefits increase every year at the consumer price index or a fixed percentage. claim payout With the Minimum Protected FUND you specify a minimum level for your LIFE FUND. If you need to claim, your LIFE FUND will reduce by the claim amount unless you have the Minimum Protected FUND LIFE FUND with Minimum Protected FUND LIFE FUND without Minimum Protected FUND LIFE FUND Minimum Protected FUND It s important to remember that life insurance isn t a financial product you can buy and then neglect. It s vital to regularly review your level of cover. Life-changing events such as having another baby or moving house can affect how much life insurance you need so make sure you review your requirements when something significant happens to you. 8

10 HOW CAN I MAXIMISE MY COVER AT THE LOWEST PRICE? With the Cover Integrator you can increase your LIFE FUND at an average saving of 50% on the increased cover while the Financial Integrator enhances your LIFE FUND to give you comprehensive cover against financial and economic uncertainty. THE COVER INTEGRATOR Getting more cover with the Cover Integrator The Cover Integrator gives you the ability to increase your LIFE FUND at an approximate premium saving of 50% on the increased cover. The level of Cover Integrator will then fluctuate on an annual basis depending on your Vitality status. You have two options to choose from: 1. Cover Integrator equal to 20% of the LIFE FUND 2. Cover Integrator equal to 40% of the LIFE FUND On the Classic LIFE PLAN, you get an automatic 5% Cash Conversion whereby 5% of your Cover Integrator FUND at age 65* is paid to you as a cash lump sum. How the Cover Integrator works Cover Integrator LIFE FUND When the policy starts you may choose a Cover Integrator level of 20% or 40% Age 65* Your Cover Integrator will fluctuate annually based on your Vitality status PLUS 100% 0% If you have a Classic LIFE PLAN, you will automatically receive 5% of your Cover Integrator FUND as a cash lump sum at age 65*. Up to 100% of the Cover Integrator FUND is paid as a tax-free lump sum to assist with retirement funding. This payment does not reduce the client s Cover Integrator FUND or LIFE FUND The Cover Integrator and premiums will continue for whole of life, with no additional Integrated Cover Adjustments after age 65* * The latter of age 65 and 10 years after the start of your benefit. 9

11 THE COVERBOOSTER Getting more life cover with the Life CoverBooster The Life CoverBooster gives you 32% extra life cover (excluding Cover and Financial Integrator) for three years at no additional premium. After three years you can buy this extra cover, free of underwriting, at a discounted rate of up to 15%. This depends on your Vitality status in the first three years, according to the following table: Vitality Status Blue Bronze Silver Gold Diamond 0% 1,5% 3% 4% 5% Example: If you were on Blue Vitality status at the end of year one, on Silver Vitality status at the end of year two and Gold Vitality status at the end of year three, your premium discount at the end of three years will be: 0% + 3% + 4% = 7% At age 65, 5% of your CoverBooster Fund will be paid out to you as a tax free cash lump sum without reducing your cover. If you are age 56 or older, at the time of adding this benefit, you will get half the discounted cover for three years and you won t receive the 5% cash conversion. Getting more life cover with the Drive CoverBooster If you are a member of VitalityDrive, your additional life cover amount can be increased to 50% (excluding Cover and Financial Integrator) for five years through Drive CoverBooster. After five years you can buy this extra cover, free of underwriting, at a discounted rate of up to 35%. This depends on your Vitality and VitalityDrive TM status in the first five years, according to the following table: VitalityDrive TM Status the BenefitBooster With the BenefitBoosters, you can increase your risk cover by up to 40% at no additional premium. Structure your LIFE PLAN efficiently with BenefitBooster TM Your benefits can either be: No-VitalityDrive TM / Base Vitality Status Blue Bronze Silver Gold Diamond 0% 1,5% 3% 4% 5% Neutral 0,5% 2% 3,5% 4,5% 5,5% Engaged 1% 2,5% 4% 5% 6% Advanced 2% 3,5% 5% 6% 7% Example: If you were on Blue Vitality and Base VitalityDrive TM status at the end of year one, on Silver Vitality and Base VitalityDrive TM status at the end of year two and Gold Vitality and Engaged VitalityDrive TM status at the end of years three, four and five, your premium discount at the end of five years will be: 0% + 3% + 5% + 5% + 5% = 18% At age 65, 5% of your CoverBooster Fund will be paid out to you as a tax free cash lump sum without reducing your cover. If you are age 56 or older, at the time of adding this benefit, you will get half the discounted cover for five years and you won t receive the 5% cash conversion. Accelerated which means that claims on the benefit reduces your LIFE FUND, or Non-accelerated or standalone which means that claims on the benefit do not affect your LIFE FUND. If you choose any of the following accelerated benefits, you can receive additional cover through the BenefitBooster at no additional premium: Severe Illness Benefit Spouse Life Cover Spouse Capital Disability Benefit Spouse Severe Illness Benefit The amount of additional cover you receive depends on the benefit amount as a percentage of your LIFE FUND according to the following table: Benefit percentage of ancillaries Benefit percentage between 0% and 49% Benefit percentage between 50% and 59% Benefit percentage between 60% and 69% Benefit percentage between 70% and 79% Benefit percentage between 80% and 89% Benefit percentage between 90% and 100% Technical details Percentage boost 0% 10% 15% 20% 30% 40% You need at least 70% accelerated Capital Disability Benefit and a Capital Disability Benefit amount of at least R to qualify for the BenefitBooster. Your LIFE FUND will not be reduced by the BenefitBooster TM amount if you claim. The Severe Illness BenefitBooster and Spouse Severe Illness BenefitBooster only apply to Severity A and B illnesses. The Spouse Capital Disability BenefitBooster only applies to Category A, B and D (if applicable). 10

12 HOW CAN I REDUCE Personal MY MONTHLY PREMIUMS? If you have a Discovery Health Plan, are a Vitality member or have a DiscoveryCard, you can benefit from integrating these products with your LIFE PLAN to enjoy an initial premium discount, the ability to control your premium over time and the opportunity to have a portion of your premiums paid back to you every five years. You can pay lower premiums with our range of Integrators When you decide to integrate your policy, you can choose between the Personal Integrator and the Business Integrator. These Integrators offer you the ability to control your premium increases and with the Personal Integrator the chance to also receive the PayBack benefit. This is what each has to offer: Integrator Business Integrator Upfront discounts of up to 32%.75% Additional benefit requirements Yes No Will you get the PayBack Benefit Yes, up to 60% No You must have additional benefits on your LIFE PLAN, for example the Severe Illness Benefit or the Capital Disability Benefit, to qualify for the Personal Integrator. The Integrators are: The Health Integrator with PayBack The Vitality Integrator with PayBack and, The DiscoveryCard Integrator THE HEALTH INTEGRATOR FOR DISCOVERY HEALTH MEMBERS This Integrator allows you to receive an initial premium discount of up to 20%, and the power to control future premium increases or decreases by actively managing and improving your health and lifestyle. If you have the Classic LIFE PLAN and the Personal Integrator, you can also receive up to 60% of your premiums back every five years. Your upfront premium reduction The type of Discovery Health Plan you have, your funding option and whether you have a Personal or Business Integrator will determine your initial premium reduction. Your initial premium reduction will be as indicated in the table below: LIFE PLAN Standard/Accelerater Standard/AcceleRater ModeRater/SupeRater ModeRater/SuperRater Integrators Personal Integrator Business Integrator Personal Integrator Business Integrator Health Plans Executive/Comprehensive/Priority 20% 10% 15% 7.5% Core/Saver 17.5% 8.75% 15% 7.5% You can manage your premium increases Every year, we will look at your Discovery Health claims, together with your Vitality status over the previous policy year to determine your premium increase with the help of the Personal Health Matrix. The Discovery Health claims that are included are the Hospital Benefit and the Chronic Illness Benefit claims for the principal life, spouse and children on the Discovery LIFE PLAN as well as medical expenses accumulating towards and above the Above Threshold Benefit for the principal life and spouse on the Health Plan. There are, however, several health claims that are excluded from the calculation including optometry, dentistry, childbirth without complications, screening benefits and many more. 11

13 The PayBack TM benefit The Discovery PayBack benefit makes it possible for you to build a financial asset in your life insurance policy by managing your health (only available on Classic LIFE PLAN). Every five years, you will receive a percentage of your LIFE PLAN premiums paid over the previous five years. The percentage refund you receive will depend on your Discovery Health claims and your Vitality status. The amount you receive in any five-year period will not be impacted by any previous five-year period, but will be reduced by any claims you may have on your LIFE PLAN in the five-year period. THE VITALITY INTEGRATOR FOR DISCOVERY VITALITY MEMBERS This Integrator allows you to receive an initial premium discount of up to 17.5%, and the ability to control future premium increases and decreases by improving and managing your health. If you have the Classic LIFE PLAN and Personal Integrator you could also receive up to 25% of your premiums back. Your upfront premium reduction Your funding option and whether you have a Personal or Business Integrator will determine your initial premium reduction. Your initial premium reduction will be as indicated in the table below: Type of Integrator Standard/AcceleRater ModeRater/SupeRater Personal Integrator 17.5% 15% Business Integrator 8.5% 7.5% You can manage your premium increases With the Vitality Integrator, your future premium increases are determined by your Vitality status. If you reach Gold Vitality status, you will be able to reverse previous premium increases if you continue to effectively manage your health and maintain your Vitality status. Your premium increase or decrease will be as indicated in the table below: Vitality Status THE DISCOVERYCARD INTEGRATOR FOR VITALITY MEMBERS WITH A DISCOVERYCARD This Integrator will not only allow you to enjoy an initial premium reduction of up to 15% but you can also increase your premium discounts by channelling your spend through the DiscoveryCard. Your upfront reduction Percentage premium increase or decrease Blue 2.25% Bronze 1.50% Silver 0.50% Gold -0.50% Diamond -0.75% If you have decided to integrate your policy, your premium will not be more than an equivalent policy that is not integrated for the first five years. With the DiscoveryCard Integrator you will receive a 15% upfront reduction if you have chosen the Personal Integrator and a 7.5% reduction on the Business Integrator on your LIFE PLAN premium. You can manage your premium increases With the DiscoveryCard, your future premium increases or decreases every year will depend on your average monthly DiscoveryCard spend in the previous policy year and your Vitality status over the previous policy year. If you have the DiscoveryCard Integrator, your premium will never be more than if you had not integrated the policy with the DiscoveryCard. 12

14 HOW CAN I ENSURE THAT MY PREMIUM IS SUSTAINABLE? We know that everybody has unique needs and financial circumstances, so we have a range of premium payment options. You can choose the premium payment option that best suits your needs and your lifestyle. While you are working When you take out your LIFE PLAN, you can choose from four flexible funding options to suit your needs STANDARD This option has the highest initial premium, but has the lowest future premium increases to maintain cover. MODERATER The initial premium for whole-of-life benefits is lower than on the Standard funding method. To maintain cover, the premiums for these benefits increase by an additional 20% every 10 years. ACCELERATER Your initial premium is lower than the Standard and ModeRater funding options, but will increase every year according to your age to maintain your cover at the right level as you get older. Premium Premium Premium Year Year Year 4 SUPERATER This option has the lowest initial premium of all the options. Annual compulsory increases maintain cover at a specified level as a client gets older. In addition, premiums for whole-of-life benefits will be increased by 20% every 10 years. Premium Year 13

15 THE FINANCIAL INTEGRATOR TM Protection against adverse economic events with the Financial Integrator The Financial Integrator gives you the ability to maximise your LIFE FUND at a premium saving of 5% on the increased cover. The Financial Integrator FUND then fluctuates on an annual basis depending on your Vitality status in the same way as the Cover Integrator. You have two options to choose from: 1. Financial Integrator equal to 20% of the LIFE FUND 2. Financial Integrator equal to 40% of the LIFE FUND The Financial Integrator has six flexible mechanisms that give protection against adverse financial outcomes: 1. Guarantee the return of your investments at CPI or CPI + 3% through the Asset Protector.* 2. Increases in the prime interest rate can have a significant impact on your ability to repay your debt. The Debt Instalment Protector *gives protection by refunding the increase in your monthly debt instalment to you. 3. The Currency Protector *protects you against rand depreciation against either the US dollar or euro. 4. Get the interest you need to pay on your DiscoveryCard back through the DiscoveryCard Interest Protector.* 5. Receive an additional lump sum if the cost of medicine after you have been diagnosed with a severe illness exceeds a set amount through the Severe Illness Benefit Medical Booster. You must be a member of the Discovery Health Medical Scheme and have the Severe Illness Benefit to qualify. 6. Boost your retirement income with the Financial Integrator Cash Conversion. When you turn 65**, 10% of your Financial Integrator FUND will convert to cash (on the Classic LIFE PLAN). This payout will not reduce the risk cover offered by the Financial Integrator after age 65**. The Cash Conversion Benefit You can buy the Cash Conversion benefit on both the Cover and Financial Integrator which allows you to receive 25%, 50%, 75% or 100% of your Cover and Financial Integrator FUNDS at age 65 as a tax free cash lump sum to supplement retirement savings. If you die before age 65, you are guaranteed to get the premiums you paid for the Buy-up Cash Conversion benefit refunded to you***. How the Financial Integrator works Financial Integrator LIFE FUND 100% 0% Cover is enhanced by the Financial Integrator FUND Protectors according to economic changes. 100% of the enhanced cover provided by the Protectors is paid at age 65**. 25% to 100% of the Financial Integrator FUND (excluding additional protection provided by specific Protectors chosen) is paid out at age 65**. The Classic LIFE PLAN provides an automatic payment of 10% of the Financial Integrator Fund at age 65**. Age 65** * These projectors will be paid on the earlier of death of the principal life or age 65. ** The latter of age 65 and 10 years after the start of your benefit. *** Does not apply if you were older than 55 at the start of your benefit. 14

16 1 Sustaining your premiums once you have retired The Paid-up and Lock-in options ensure that you are able to maintain your cover by keeping your premiums affordable. This gives you the security that your retirement income will not be eroded by the increasing costs of your LIFE PLAN. PAID-UP Adding the Paid-up option to the Standard option at the inception of the policy ensures that you stop paying premiums at age 65, but benefits continue for the rest of your life. Automatic benefit increases will cease at age 65. Premium Year Premium for Standard with Paid-up option Premium for Standard option Your premium is guaranteed We guarantee that your premium will not be increased by more than your automatic annual increases for the first 10 years of your policy. We further guarantee that if we need to increase your premium at the end of the first 10 years, and any 10-year period thereafter, these increases will never be more than 25% of the premium you are paying at the time. If you are a Vitality member, you can increase this guarantee even further by reducing the maximum potential increase according to your Vitality status. The percentage reduction is determined according to the number of years you have enjoyed on each Vitality status. Per Blue status year Per Bronze status year 0% 0.5% 1% 1.5% 2% 2.5% 2 LOCK-IN Adding the Lock-in option to the AcceleRater option at the inception of the policy means that both the automatic annual premium and benefit increases will cease. You may choose either the 20-year or age 65 Lock-in option. Premium Year Premium for AcceleRater with Lock-in option Premium for AcceleRater option Per Silver status year Per Gold status year Per Diamond status year For example: at the end of 10 years, assuming you were on Blue status for two years, Bronze status for three years, Silver status for three years and Gold status for two years, the maximum potential increase is 14% as shown below: 25% - (2 x 0%) (3 x 0.5%) (3 x 1.5%) (2 x 2.5%) = 14% 15

17 WHAT NEXT? The Discovery LIFE PLAN has been created to achieve the most relevant and personalised levels of protection and benefits at the most cost-effective premium. All the information you need to structure a LIFE PLAN has been provided. Determine the level of security The best way to determine the level of financial security you need is to examine, with the help of a financial adviser, the different types of insurance available to you. Financial advisers are qualified and registered professionals who are able to help you get the best cover. Complete the application Once you have selected benefits that meet your needs, a quote will be drawn up for you. If you are happy with the quote you will need to fill in the necessary application forms and complete underwriting, if required. When completing your application always be completely honest about your health, any pre-existing medical conditions and personal circumstances because this affects your policy. Service and information At Discovery Life, we believe in being as open and transparent as possible. If you feel that the information or service you have received was not satisfactory, contact our Compliance Department at compliance@discovery.co.za. You can also contact the Ombudsman for Long-term Insurance on 0860 OMBUDS ( ). Perform a Financial Needs Analysis By performing a Financial Needs Analysis with your financial adviser you can determine what your ongoing and future obligations are. This amount should also cover your main debts, such as a home loan or credit card debt. It is also important to consider the impact of an increase in the cost of living on your life insurance benefits. Review your policy During the lifetime of your policy, it is important to regularly review your LIFE PLAN and to update it if your circumstances change, for example buying a new home or the birth of a child. This will ensure you and your family are covered when your needs change.

18 GM_036DL_07/06/12 SYLPE 05/12 Discovery Life is an authorised financial services provider. Registration number 1966/003901/06 Physical address: 155 West Street, Sandton. Postal address: PO Box 3888, Rivonia Contact centre: LIFE ( ) Fax number: 0860 LIFE FX ( )