Lifetime income benefit

Transcription

1 Lifetime income benefit Guarantee your income for life Great-West Life segregated fund policies

2 Segregated fund policy information Investments tailored to protect you Table of contents Financial strength and stability...3 Great-West Life lifetime income benefit...4 Guarantee your income for life...4 Longevity risk...5 Market return risk...5 Take control of your income...6 Is it right for you?...6 Guaranteed income for life...7 No matter how long you live...7 Five per cent annual deferral bonus...8 Increase your lifetime income with deferral bonuses...8 Bonuses can add up...8 Income resets...9 Increase your lifetime income amount with resets...9 Market conditions don t affect your retirement income...10 Market conditions don t affect your savings...11 Payments from registered policies...12 Great-West Life segregated funds plus lifetime income benefit...13 A powerful combination...13 Choose your guarantee...13 Select the right funds for you...14 Managed portfolio s...14 Individual funds...16 Investment...17 Glossary of terms

3 Financial strength and stability Great-West Life is a leading Canadian insurer with interests in life and health insurance, investment, retirement savings and reinsurance businesses, primarily in Canada and Europe. In Canada, Great-West Life and its subsidiaries, London Life and Canada Life, offer a broad portfolio of financial and benefit plan s and serve the financial security needs of more than 12 million people. Great-West Life s products include a wide range of investment, retirement savings and income plans, as well as life, disability, critical illness and health insurance for individuals and families. Great-West Life has more than $192 billion * in assets under administration and is a subsidiary of Great-West Lifeco Inc., a member of the Power Financial Corporation group of companies. *Assets as at Sept. 30, 2010 For information about Great-West and our products and services, visit Notes about segregated fund policies This information applies only to the Great-West Life segregated funds launched in The Great-West Life segregated funds contract and information folder contain complete details about all the features of the lifetime income benefit. Read them carefully to ensure you understand the lifetime income benefit and its features. Features and guarantees vary by policy and age of annuitant and some limitations apply. Maturity and death benefit guarantees are reduced proportionately by withdrawals. Creditor protection depends on court decisions and applicable legislation, which can be subject to change and can vary between provinces; it can never be guaranteed. Talk to your lawyer to find out more about the potential for creditor protection for your specific situation. Deferral bonuses are not a guaranteed rate of return. They have no cash value and do not increase any applicable maturity or death guarantee benefits. Deferral bonuses increase your eligible lifetime income amount. Excess withdrawals will decrease the lifetime income amount and you will no longer be eligible for any future bonuses. An excess withdrawal is a withdrawal that exceeds the annual guaranteed income amount. Reset options must be chosen at time of initial premium to the segregated funds and cannot be removed once added. Additional fees apply. Income resets do not increase the maturity or death benefit guarantees. Resets are calculated every three years on the lifetime income benefit anniversary and come into effect on January 1 of the next calendar year. Once income begins, a deferral bonus can only apply when no withdrawals are made during two successive years and the market value is greater than or equal to the lifetime income withdrawal base on the most recent lifetime income benefit anniversary. 3

4 Great-West Life lifetime income benefit Guarantee your income for life For years your focus has been to save for retirement. Now you need innovative s to help you transition your hard-earned savings into income that will last your lifetime. You also need to protect your savings against three retirement risks: Longevity risk: You might outlive your money. Market return risk: You could experience poor market returns in the early retirement years, increasing the chances you ll use all your savings sooner than you planned. Inflation risk: Your retirement savings might not earn enough to keep up with inflation. The Great-West Life lifetime income benefit option helps you manage these risks in retirement and protect your savings. The lifetime income benefit can help provide: Predictable, guaranteed income for life beginning as early as age 50 The potential for increasing income A safe transition from savings to income Guaranteed income for life for you and your spouse Your lifetime income amount will not decrease regardless of how the segregated funds perform. 4

5 Longevity risk Retirement planning considers the risk that you or your spouse might outlive your assets. The lifetime income benefit can help provide predictable, guaranteed income, no matter how long you or your spouse lives. Joint-life income can help protect couples from the risk of reduced income when a spouse dies. Market return risk Life expectancy in years at given age * Age Male Female As you plan for retirement, you may question what happens if you experience poor market returns early in retirement. Industry experts consider the five years before and the five years after retirement an especially critical phase for your retirement savings. This 10-year period is often referred to as the retirement risk zone because short-term losses in the years leading up to retirement have a limited time to recover before you begin to rely on them for income. The shorter the recovery period before and after your retirement date, the greater the negative effect these losses have on your ability to sustain income for life. Retirement Retirement risk zone risk zone *Source: Life expectancy, by age group and sex. Statistics Canada, 2002 Hypothetical policy market value Saving years Retirement risk zone Retirement income years Age Retirement date For illustration purposes only. Policy market value is hypothetical only and not indicative of future performance. The lifetime income benefit helps get you through the retirement risk zone by guaranteeing the starting value on which your lifetime income amount will be based. You can increase your income amount through bonuses earned in every year you defer making a withdrawal prior to taking an income. 5

6 Take control of your income The lifetime income benefit puts you in control of your retirement savings and income by guaranteeing your income for life. Your income won t decrease regardless of how the segregated funds perform, which provides you with protection against the risks of longevity, inflation, and market returns and volatility. Guaranteed income for life life Hypothetical policy market value $550,000 $500,000 $450,000 $400,000 $350,000 $300,000 $250,000 $200,000 $150,000 $100,000 Even if the policy market value drops to $0, you are guaranteed to continue receiving payments for the rest of your life. $50,000 $25,000 $0 Age 65 Guaranteed income for life For illustration purposes only. Policy market value is hypothetical only and not indicative of future performance. The lifetime income benefit option offers a lifetime income amount, which will never decrease provided excess withdrawals are not taken. Is it right for you? The lifetime income benefit is just one component of a well-diversified retirement income portfolio. It s most appropriate for people getting ready to retire and retirees looking for secure predictable, guaranteed income. You and your spouse, if applicable, must be age 50 and under age 91 to add the lifetime income benefit to a segregated fund policy. Information at your fingertips Visit lifetimeincome.greatwestlife.com for more information about the features and advantages of the lifetime income benefit. The lifetime income benefit works best for people who do not already have guaranteed retirement income. Guaranteed income comes from government benefits, company pension plans or life annuities. You should allocate only a portion of your retirement income portfolio to the lifetime income benefit. You will want to keep some funds easily accessible for emergencies and other needs that arise. The lifetime income benefit doesn t allow you to take out extra money without penalties. Work with your financial security advisor to develop a savings and income plan that s appropriate for you. He or she can show you how the lifetime income benefit may help you to meet your retirement goals. 6

7 With the lifetime income benefit, you re guaranteed income for life, whether you live to 85, 105 or Guaranteed income for life beyond. Your income will not decrease, regardless of how the segregated funds No matter how long you or your spouse live perform. The Great-West Life lifetime income benefit provides predictable, guaranteed income for life, starting as early as age 50, unlike other policies that don t start distributing income until age 65. The lifetime income amount is based on your age; this makes you eligible for higher income payments as you get older. When you select joint-life income, the lifetime income amount is based on an income percentage that corresponds with your current age (or your spouse, if applicable). When you add the lifetime income benefit, your eligible lifetime income amount is the market value of your policy multiplied by the income percentage corresponding to your current age. The percentage used to calculate the lifetime income amount increases with age. Age used to calculate income Single-life income percentage Joint-life income percentage 50 to % 3.50% 55 to % 3.75% 60 to % 4.00% 65 to % 4.50% 70 to % 4.75% % 5.50% You may be able to increase your income through deferral bonuses and resets. 7

8 Five per cent annual deferral bonus Increase your lifetime income with deferral bonuses With the lifetime income benefit, you are eligible to earn a five per cent deferral bonus every year until you make a withdrawal. If you don t need to take income right away, the deferral bonus can help you grow your lifetime income amount even when markets are down. Once you begin taking an income, you are no longer eligible for deferral bonuses. If you stop taking income, you will only be eligible for deferral bonuses again when your policy value exceeds your lifetime income withdrawal base. Important: Deferral bonuses are not a guaranteed rate of return. They have no cash value and do not increase any applicable maturity or death guarantee benefits. Deferral bonuses increase your eligible lifetime income amount. Bonuses can add up You can increase your income amount through bonuses earned in every year you defer making a withdrawal before you start taking an income. Bonuses increase the lifetime income withdrawal base, which help determine the lifetime income amount available to you. For example: If you contribute a premium of $200,000 to your policy and defer income for 10 years, your lifetime income withdrawal base will have a minimum value of $300,000 because of deferral bonuses. 8

9 Income resets Increase your lifetime income amount with resets As policy values increase, you have the potential to secure those gains to increase your lifetime income amount. Your lifetime income amount will not decrease regardless of how the segregated funds perform. Key features of income resets Can occur every three years Lifetime income amount will increase when a reset is applied Resets are available for the life of the policy Income resets do not increase the maturity or death benefit guarantees How income resets work This example shows how the lifetime income withdrawal base is increased every three years when the policy value is greater than the existing lifetime income withdrawal base. Income reset option Income reset option Hypothetical policy market value Reset New guarantee amount Years Hypothetical market value Lifetime income withdrawal base For illustration purposes only. Policy market value is hypothetical only and not indicative of future performance. Secure growth with automatic income resets Once your lifetime income withdrawal base increases, it is guaranteed for life regardless of any future down markets, assuming no excess withdrawals are made. 9

10 Market conditions don t affect your retirement income Jack, age 65, is planning his retirement income. He has a certain amount of guaranteed income from his company s pension plan and decides to allocate $500,000 from his savings to a policy with the lifetime income benefit. He starts taking income immediately. Based on Jack s age and initial premium, he is guaranteed to receive an annual lifetime income amount of $25,000 (five per cent of $500,000). Scenario Taking income in a down market Even if the market value of his policy is reduced because of a market downturn, the lifetime income benefit still guarantees Jack income for life. After 16 years, Jack s policy market value reduces to $0. However, thanks to the lifetime income benefit, he continues to receive $25,000 a year. $500,000 $400,000 $300,000 $200,000 Taking income in a down market Hypothetical policy market value Annual income $300,000 $240, Lifetime income amount (years) For illustration purposes only. Policy market value is hypothetical only and not indicative of future performance. $65,000 $55,000 $45,000 $35,000 $25,000 minimum guaranteed income for life Scenario Taking income in an up market When markets and segregated funds in Jack s policy perform well, Jack can take advantage of income resets and higher income percentages. $1,000,000 $800,000 $600,000 $400,000 Taking income in an up market Hypothetical policy market value $25,000 $26,545 $50,570 minimum guaranteed income for life As mentioned above, Jack s annual lifetime income $15,000 amount starts at $25,000. However, every three years, Jack s policy can reset his Lifetime income amount (years) income to a higher amount, For illustration purposes only. Policy market value is hypothetical only and not indicative of future performance. if the market value on that date multiplied by his income percentage results in a higher lifetime income amount. Even when taking income, Jack benefits from income resets every three years. In this example, by year 18, Jack s policy value grows to $842,833. His income percentage is six per cent, which results in an income of $50,570. If the segregated funds in his policy continue to perform well, his income could continue to increase. $26,797 $31,580 $34,681 $44,069 $50,570 $75,000 $60,000 $30,000 10

11 Market conditions don t affect your savings Nancy, age 50, wants to retire within 15 years. As a small business owner without a pension plan, she allocates $200,000 of her savings to the lifetime income benefit. This allows her to take advantage of the guarantees, income resets and deferral bonuses that may increase her lifetime income amount. Nancy s initial premium establishes a lifetime income withdrawal base of $200,000. For every year she defers taking income, she benefits from a five per cent deferral bonus. However, if Nancy decides to take income, she could still be eligible for a deferral bonus again when lifetime income withdrawal base resets to a higher amount. The bonus is a notional amount that, when added to her lifetime income withdrawal base, increases the lifetime income amount she is guaranteed to receive. Deferral bonuses have no cash value. Scenario Deferring income in a down market Deferring income in a down market As Nancy approaches her retirement $450,000 date, she can decide to receive a $400,000 lifetime income amount at any time. For $350,000 example, at age 65, her lifetime income $300,000 amount is $17,000 per year (five per $250,000 cent of $340,000). This annual amount $200,000 is guaranteed for life and could $150,000 increase. In this down market, however, $100,000 $50,000 Nancy is concerned about the poor $0 segregated fund returns her policy has been experiencing. She decides to stay Years in business and let the annual deferral Lifetime income withdrawal base Deferral bonus Hypothetical policy market value bonus continue, so she can increase her For illustration purposes only. Policy market value is hypothetical only and not indicative of future performance. income when she retires. Fortunately for Nancy, even in down markets her lifetime income amount is guaranteed, and it can grow through deferral bonuses. Through deferral bonuses of $10,000 accumulated over 20 years, Nancy s lifetime income withdrawal base grows to $400,000. The lifetime income amount available to Nancy when she retires at age 70 is $21,000 (5.25 per cent of $400,000). She is guaranteed to receive this amount every year for the rest of her life. Nancy could have deferred even longer because there is no maximum deferral period. Scenario Deferring income in an up market Deferring income in an up market If Nancy retires at 65 after several years of policy growth, she can benefit from both deferral bonuses and income resets. Income resets can occur as often as every three years. They can lock-in market growth and increase the lifetime income amount. They can also increase the amount of deferral bonus Nancy receives. $0 In this example, Nancy can start receiving more than $32,000 per year Years at age 65. However, if she waits five Lifetime income withdrawal base Deferral bonus Hypothetical policy market value more years and enjoys continued For illustration purposes only. Policy market value is hypothetical only and not indicative of future performance. positive segregated fund performance, her starting income can be much higher. In this example, if Nancy retires at age 70, her lifetime income withdrawal base is $986,159 because of deferral bonuses and policy market value resets. Nancy is now guaranteed to receive $51,773 every year for the rest of her life. $1,200,000 $1,000,000 $800,000 $600,000 $400,000 $200,000 $21,000 minimum guaranteed income for life 5.25% x $400,000 $51,773 minimum guaranteed income for life 5.25% x $986,159 11

12 Payments from registered policies Legislated minimum payments When you convert your registered retirement savings plan (RRSP) into registered retirement income fund (RRIF) you are required to take minimum annual payments. The lifetime income benefit was designed to provide income for life, regardless of RRIF payments. You can meet the legal requirements of the minimum annual payment schedule, and still be guaranteed an annual income even if the market value of your policy is reduced to zero. In each calendar year, you may withdraw the greater of the RRIF minimum or the lifetime income amount. If you select joint-life income, the RRIF minimum must be based on the younger spouse s age. If your legislated minimum exceeds the lifetime income amount, the legislated minimum will be paid to you. These payments are not treated as excess withdrawals. For example: If the lifetime income amount is $10,000, but the RRIF minimum is $12,000, you would receive $12,000 to meet the legislative minimum. However, it s not considered an excess withdrawal, so your guaranteed lifetime income amount remains intact. If you withdrew any amount above $12,000, it would be an excess withdrawal, which negatively affects your lifetime income amount. Currently, only 75/75 or 75/100 guarantee policies offer the lifetime income benefit option. The policy must be a: Non-registered policy RRSP and spousal RRSP RRIF and spousal RRIF Prescribed retirement income fund (PRIF) Saskatchewan and Manitoba only Locked-in retirement account (LIRA) Saskatchewan only 12 12

13 Great-West Life segregated funds plus lifetime income benefit A powerful combination By combining a segregated fund policy with the lifetime income benefit, you get income for life as well as an investment portfolio tailored to suit your needs. With a minimum initial investment of $25,000, you can select from a variety of funds containing fixed income and equity. You have the potential to build your while receiving secure income payments regardless of what happens to portfolio values. You can add the lifetime income benefit to one of two Great-West Life segregated fund policies at any time. 75/75 guarantee policy 75/100 guarantee policy Access your savings at any time Segregated fund policies offer access to assets whenever needed. Certain fees or RRIF minimums, if applicable, may apply at the time of withdrawal. Withdrawals in excess of the annual guaranteed income amount will affect your lifetime income amount and make you ineligible for deferral bonuses. Choose your guarantee You have the flexibility to choose the maturity and death benefit guarantees to protect you. This helps you tailor your investment s to fit your needs and financial goals. Benefits of segregated fund policies Segregated fund policies are life insurance contracts. This means segregated fund policies have benefits and standard protection features, including: Creditor protection potential because segregated funds are part of an insurance policy, your policy may be protected from creditors. No trustee fees if you choose a registered segregated fund policy, there are no trustee fees. Estate bypass upon notification of the last annuitant s death, proceeds go directly to named beneficiaries, if other than the estate, bypassing the delays and expense of the probate process. 75/75 guarantee 75/100 guarantee 75 per cent maturity guarantee and 75 per cent death benefit guarantee You re guaranteed to receive 75 per cent of all premiums contributed, reduced proportionately by any withdrawals: At the maturity guarantee date On notification of death of the last annuitant 75 per cent maturity and 100 per cent death benefit guarantee At maturity guarantee date: 75 per cent of premiums contributed, reduced proportionately by any redemption are guaranteed. On notification of death of the last annuitant: Up to 100 per cent of premiums contributed reduced proportionately by any withdrawals are guaranteed. Premiums contributed when youngest annuitant is age 80 or older are subject to a graded death benefit guarantee schedule. 13

14 Select the right funds for you With Great-West Life segregated fund policies, you can add the lifetime income benefit option to 28 eligible segregated funds. Managed portfolio s Great-West s managed portfolio s combine several funds to create one investment vehicle, or fund of funds. With several options available, you can select a portfolio that best suits your risk tolerance. As well, you can choose a managed by multiple investment or one manager. Fund Investment manager Fund category Management style Fund objective Core portfolio s Core Conservative Growth Multiple Focuses on providing interest income with the potential for capital appreciation by investing primarily in units of Canadian fixed income funds while investing a smaller portion in Canadian and foreign equity funds Allocates 30 per cent to equity and 70 per cent to fixed income Focuses on providing a balance between current income and long-term capital growth by investing primarily in units of Canadian fixed income funds, while investing a smaller portion in Canadian and foreign equity funds Allocates 40 per cent to equity and 60 per cent to fixed income and current income by investing in units of Canadian fixed income and Canadian and foreign equity funds Allocates 50 per cent to equity and 50 per cent to fixed income and current income by investing in units of Canadian fixed income and Canadian and foreign equity funds Allocates 60 per cent to equity and 40 per cent to fixed income Focuses on providing long-term capital growth by investing primarily in units of Canadian and foreign equity funds while investing a smaller portion in Canadian fixed income funds Allocates 70 per cent to equity and 30 per cent to fixed income Core Moderate Multiple Core Moderate Growth Plus Multiple Core Balanced Multiple Core Balanced Growth Plus Multiple Partner s Pyramis Moderate Income Pyramis Focuses on providing interest income with the potential for capital appreciation by investing in units of funds managed by Pyramis Global Advisors Invests primarily in fixed income funds, while investing a smaller portion in units of Canadian and foreign equity funds Allocates 35 per cent to equity and 65 per cent to fixed income Focuses on providing interest income with the potential for capital appreciation by investing in units of funds managed by Franklin Templeton Investments Invests primarily in fixed income funds, while investing a smaller portion in units of Canadian and foreign equity funds Allocates 35 per cent to equity and 65 per cent to fixed income Focuses on providing interest income with the potential for capital appreciation by investing in units of funds managed by Mackenzie Financial Corporation Primarily invests in fixed income funds, while investing a smaller portion in units of Canadian and foreign equity funds Allocates 35 per cent to equity and 65 per cent to fixed income Franklin Templeton Moderate Income Templeton Mackenzie Moderate Income Mackenzie 14

15 Fund Investment manager Fund category Management style Fund objective Pyramis Moderate Growth Pyramis and current income by investing in units of Canadian fixed income and Canadian and foreign equity funds managed by Pyramis Global Advisors Allocates 45 per cent to equity and 55 per cent to fixed income Franklin Templeton Moderate Growth Templeton and current income by investing in units of Canadian fixed income and Canadian and foreign equity funds managed by Franklin Templeton Investments Allocates 45 per cent to equity and 55 per cent to fixed income Mackenzie Moderate Growth Mackenzie and current income by investing in units of Canadian fixed income and Canadian and foreign equity funds managed by Mackenzie Financial Corporation Allocates 45 per cent to equity and 55 per cent to fixed income Pyramis Balanced Income Pyramis and current income by investing in units of Canadian fixed income and Canadian and foreign equity funds managed by Pyramis Global Advisors Allocates 55 per cent to equity and 45 per cent to fixed income Franklin Templeton Balanced Income Templeton and current income by investing in units of Canadian fixed income and Canadian and foreign equity funds managed by Franklin Templeton Investments This fund typically allocates 55 per cent to equity and 45 per cent to fixed income Mackenzie Balanced Income Mackenzie and current income by investing in units of Canadian fixed income and Canadian and foreign equity funds managed by Mackenzie Financial Corporation Allocates 55 per cent to equity and 45 per cent to fixed income Mackenzie Balanced Mackenzie and current income by investing in units of Canadian fixed income and Canadian and foreign equity funds managed by Mackenzie Financial Corporation Allocates 60 per cent to equity and 40 per cent to fixed income CI Balanced Income CI and current income by investing in units of Canadian fixed income and Canadian and foreign equity funds managed by CI Investments Allocates 55 per cent to equity and 45 per cent to fixed income Portfolio funds Conservative Portfolio Fund Multiple Asset allocation Invests mainly in fixed income investment funds and includes a small investment in Canadian and foreign equity investment funds and a portion of real estate Aims to invest 25 per cent in equity and 75 per cent in fixed income Moderate Portfolio Fund Multiple Asset allocation Invests mainly in fixed income investment funds and includes a significant investment in Canadian and foreign equity investment funds and a portion of real estate Aims to invest 40 per cent in equity and 60 per cent in fixed-income 15

16 Fund Investment manager Portfolio funds (continued) Balanced Portfolio Fund Multiple Income portfolio funds Conservative Income Portfolio Fund Moderate Income Portfolio Fund Balanced Income Portfolio Fund Multiple Multiple Multiple Fund category Asset allocation Asset allocation Asset allocation Asset allocation Individual funds Cash and cash equivalents Money Market GWLIM Cash and cash equivalents Balanced funds Management style Not applicable Diversified GWLIM Balanced Top-down, growth Equity/Bond GWLIM Balanced Top-down, growth Managed Laketon Balanced Top-down, blend Canadian Balanced Balanced Mackenzie Balanced Bottom-up, blend Beutel, Goodman Balanced Bottom-up, value Fund objective Focuses on achieving a balance between growth and income Underlying investment funds invest in a broad range of fixed income and equities issued by Canadian and foreign corporations, real estate and in cash and short-term securities Aims to invest 60 per cent in equity and 40 per cent in fixed income Invests mainly in fixed income investment funds and includes a small investment in Canadian and foreign equity investment funds and a portion of real estate Aims to invest 20 per cent in equity and 80 per cent in fixed income Focuses on providing interest income with the potential for capital appreciation by investing mainly in fixed income investment funds, but provides an opportunity for growth with equity funds Aims to invest 35 per cent in equity and 65 per cent in fixed income Focuses on providing long-term growth by investing primarily in units of Canadian and foreign equity funds and a consistent flow of income through a significant investment in fixed income funds Aims to invest 55 per cent in equities and 45 per cent in fixed income Focuses on providing interest income by investing primarily in Canadian fixed income securities, including Canadian government securities and corporate income producing securities maturing within one year and current income by investing in units of a broad range of investment funds, including Canadian and foreign shares, real estate, bonds, mortgages and short-term and current income by investing primarily in Canadian fixed income securities and equities Aims for a long-term asset mix of 55 per cent shares of Canadian and foreign companies and 45 per cent fixed income securities and current income by investing primarily in Canadian fixed income securities and Canadian and foreign equities Targets a long-term asset mix of 30 per cent Canadian equities, 25 per cent global equities and 45 per cent fixed income securities and current income by investing primarily in Canadian fixed income securities and equities The underlying are actively managed using a conservative growth style to achieve long-term, above-average returns while assuming moderate risk and current income by investing primarily in shares issued by Canadian and U.S. companies, Canadian bonds and short-term securities 16

17 Investment A successful fund selection along with the income reset feature and bonuses can increase your guaranteed income. Great-West Life offers a multi-manager, multi-style lineup of segregated funds that gives you the flexibility to tailor a portfolio to meet your individual needs. By investing with Great-West Life, you have some of the leading investment in the world managing your money. 17

18 Glossary of terms This section provides a brief definition of the terms associated with the Great-West Life lifetime income benefit. For a detailed explanation and other details, please talk to your financial security advisor or refer to the Great-West Life information folder. Annual guaranteed income amount is the maximum income you can take in a year without incurring an excess withdrawal. The annual guaranteed income amount is the greater of the lifetime income amount or RRIF minimum, if applicable. Base for income bonus is a notional balance used to determine the deferral bonus amount applied to the lifetime income withdrawal base. This has no cash value. Deferral bonus five per cent of the base for income bonus is added to lifetime income withdrawal base when no withdrawals have been taken in any year. This has no cash value. Excess withdrawals are cumulative annual withdrawals in excess of the lifetime income amount, or RRIF minimum (if applicable). Excess withdrawals will decrease the lifetime income amount and clients will no longer be eligible for any future bonuses. Income resets Increases in the market value of the policy, reset the lifetime income withdrawal base used to determine the lifetime income amount. Resets may occur every three years and your lifetime income amount will only be re-calculated upwards. Lifetime income amount represents the annual guaranteed lifetime income and is the maximum amount that can be withdrawn each calendar year. Lifetime income withdrawal base is a notional balance used to calculate the lifetime income amount and lifetime income benefit monthly fee. This has no cash value. Single-life income provides you with guaranteed income for life with the potential for income resets. Joint-life income provides you with guaranteed income until the last spouse dies with the potential for income resets, provided you don t take an excess withdrawal. 18

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20 A description of the key features of the segregated fund policy is contained in the information folder. Any amount that is allocated to a segregated fund is invested at the risk of the policyowner and may increase or decrease in value. Great-West Life and the key design are trademarks of The Great-West Life Assurance Company. The display of trademarks on this brochure does not imply that a license of any kind has been granted. All service and product names are trademarks of their respective owners /11 20