Plan Description ChoicePlus Universal Life Insurance provides employees with the choice of two plan designs:

Transcription

1 Colonial s Universal Life Insurance is a flexible premium, adjustable death benefit contract that accumulates cash value, available through payrolldeduction. For as little as $3.00 per week, employees can purchase individually owned life insurance coverage that is theirs to keep, even if they change jobs or retire. This plan can include coverage for: Employees ages (16-65 in WA), working at least 20 hours per week Spouses Dependent Children and Grandchildren Plan Description Universal Life Insurance provides employees with the choice of two plan designs: Option A - Level Death Benefit In an Option A plan, the death benefit equals the policy's face amount, and will not increase over time unless excess premiums are paid. This type of plan provides the most universal life insurance protection for the least cost. Option B - Increasing Death Benefit In an Option B plan, the death benefit equals the policy's face amount plus the cash value. The policyholder pays a higher premium, but the death benefit increases over time. Features & Benefits Tax deferred growth -- Cash value accumulates at current interest rates, with a guaranteed minimum interest rate of 4%. Flexibility -- Policyholders may increase or decrease the face amount and change premium payments, subject to certain limitations. Banded Rates -- provide more competitive pricing at face amounts over $100,001 (subject to underwriting approval). Accelerated Death Benefit -- Automatically included at no extra premium on all policies of $10,000 or more. This benefit allows the policy owner to advance up to 60% of the policy's death benefit if the insured is diagnosed with a terminal illness. (Rider benefits subject to state regulations.) Policy loans or cash withdrawals are available after the first policy year. The policy loan rate is 6%. The loaned amount earns 4% interest, making the net loan cost 2%. Family coverage -- Employees may buy insurance for spouse and children through individual policies and/or riders.

2 Employee Coverage Employee Policy Employee issue ages: (16-65 in WA). Minimum issue: $3 per week, or a $5,000 policy face amount. Individually owned, portable coverage. Family Coverage Spouse Policy Employees do not have to purchase coverage on themselves to purchase policies on their spouses. Spouse issue ages: (16-65 in WA). Minimum issue: $3 per week, or a $5,000 policy face amount. Individually owned, portable coverage. Spouse Term Rider A level term rider that provides coverage until the spouse's 65 th birthday. The rider's face amount may not exceed the amount of coverage issued on the primary insured. Employee issue ages: Spouse: Issue ages 16-40: $5,000 to $25,000; sold in $5,000 increments Issue ages 41-50: $5,000 to $15,000; sold in $5,000 increments Issue ages 51-60: $5,000 Convertible before age 65, to any Colonial cash value insurance product without evidence of insurability, if the base policy terminates, the rider terminates, or the insured and spouse legally divorce.

3 Child Policy Employees do not have to purchase coverage on themselves to purchase policies for their children or grandchildren. Child issue ages: 0-17, if full-time dependent student. Minimum $25,000 policy face amount. A Guaranteed Purchase Option, automatically included at no additional premium, allows coverage increases at the insured's ages 18, 21 and 24, without evidence of insurability. Policyowners may purchase the face amount of the policy at each option date, to a maximum total coverage amount of $100,000. Individually owned, portable coverage. Children's Term Rider Level term insurance for one level premium that covers all eligible children. Coverage continues until each child's 25 th birthday or insured's 65 th birthday, whichever comes first. May be added to either employee or spouse policy, but not both. Primary insured issue ages: 16-60; Child issue ages: Issue limits: $1,000 - $10,000; sold in $1,000 increments. May not exceed the face amount issued on the primary insured. Convertible any time prior to the child s 25th birthday or primary insured's 65 th birthday for up to five times the amount of the in-force Child Term Rider, without evidence of insurability. If the primary insured dies while the rider is in-force, the rider becomes fully paid up term insurance equal to the rider face amount, with no further premium, until each child reaches age 25.

4 Additional Riders Benefits and rider availability may vary in some areas according to state regulation. Accelerated Death Benefit Rider Automatically added, at no additional premium, to all employee, spouse and child policies of $10,000 or more. Allows the policy owner to request an advance of up to 60% of the policy's face amount if the insured is diagnosed with a terminal illness. Premium/monthly deductions are waived for policy and any riders once accelerated benefit is paid. Minimum accelerated amount: $5,000. Maximum accelerated amount: $250,000. A fee is charged only if the benefit is used. Accidental Death Benefit Rider Pays a benefit, in addition to the base policy's death benefit, if the insured dies as the result of an accident before age 70. This rider benefit will double if the death occurs while the insured is a fare-paying passenger on a public conveyance. May be added to employee and/or spouse policy with policy increase. Issue ages: Issue amount: Equal to policy face amount, up to $150,000 maximum. Additional Coverage Term Rider Allows the policy owner to add 20-year level term coverage for both the primary insured and/or the spouse, to the base universal life policy. May be added to employee and/or spouse policies. Issue ages: Minimum coverage amount: $10,000 for each insured Maximum coverage amount: 100% of primary insured's policy face amount. Not renewable. After one year, coverage is convertible before age 65, without evidence of insurability, if the base policy terminates, the rider terminates, or the insured and spouse legally divorce.

5 Guaranteed Purchase Option Rider Allows the insured to purchase, at three specified option dates, additional coverage not to exceed the initial face amount of the policy, without evidence of insurability. May be added to employee and/or spouse policy at the time of original policy purchase only. Issue ages: Maximum total additional coverage is $100,000. Rider terminates after 8 th policy anniversary or if the insured is on waiver. Option Dates: 2 nd, 5 th, and 8 th policy anniversaries. The policyowner can exchange one of these three policy anniversary option dates for a life event such as marriage, divorce, birth of a child, or adoption of a child. Waiver of Monthly Deduction Rider This rider waives all monthly deductions on the base policy and any attached riders if the insured becomes totally and permanently disabled prior to age 65. A six-month elimination period applies. Premiums paid during the waiting period are refunded. May be added to employee and/or spouse policy. Issue ages: Exclusions (Applies to all Plans) If the insured commits suicide within two years, whether sane or insane (one year in Colorado and North Dakota) from the issue date, we will not pay the death benefit. We will terminate this policy and return the premiums paid minus any loans, loan interest and surrenders to you. We will not pay any increases in death benefits if the insured commits suicide within two years, whether sane or insane (one year in Colorado and North Dakota) for the effective date of the increase. Our only obligation will be to refund the cost of insurance paid for the increase in the event of suicide. (In Missouri, should death occur as a result of suicide, our company is responsible only for return of premiums paid when application is made with intent to commit suicide.)