In Good Order (IGO) Transaction Guidelines. Life Operations Administrative Guide WORK IN PROGRESS!

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1 WORK IN PROGRESS! We are updating the content in this guide along with the new look and feel of our ivari brand. Meanwhile you can still use the current content as valuable information to help with your business. Any questions, don't hesitate to contact us at Client Services at Life Operations Administrative Guide In Good Order (IGO) Transaction Guidelines FOR ADVISOR USE ONLY

2 Table of contents Transamerica Life Canada (TLC) Client Services 4 How to use this document 5 Life In-force transactions 6 Cut-off times... 6 Accepted forms of payment... 7 Additional deposits (Universal Life)... 8 Cancellations/Surrenders... 9 Full or partial surrenders/cancellations Withdrawal of dividends or surrender of paid-up additions Planned periodic premium change or sundry change Premium Holiday and Shortage Provisions Fund transfers T2033 direct transfer Loans or ILS loans Pre-Authorized Debit (PAD) Establishing Pre-Authorized Debit Non-Sufficient Funds (NSF) Resuming Pre-Authorized Debit (PAD) Stopping Pre-Authorized Debit (PAD) Bank change request Modal payment change request Policy Changes 23 Adding a child to an existing rider Date of birth change Gender correction Exercising the Non-Forfeiture Option Decrease of face amount or sum insured Cancellation of coverage/benefits or riders Joint coverage to single life option Policy splits Survivorship Switch from Joint First-to-Die (JFTD) to Joint Last-to-Die (JLTD) with deductions or premiums to last death Reduced Paid-Up (RPU) for whole life plans Optimizer (universal life only) Option to automatically decrease a face amount Termination of Optimizer Option

3 Table of contents Continued Underwriting changes 35 Replacements Non-smoker change Removal or reduction of rating/change in risk classification Addition/increase of coverage (existing insureds or new lives) Cost of insurance change Death Benefit change Reinstatements Substitution of Life Insured Exercise Purchase Option Rider (POR) Conversion Converting a Policy with a Critical Illness Protection Rider Term Exchange Titles 47 Duplicate policy Ownership changes, beneficiary changes and name changes Ownership change requirements Beneficiary change requirements Name change requirements Successor or contingent owner Assignments Release of Assignments General administration 53 Address change request Limited Power of Attorney (LPOA) General requirements Advisor instructions when an LPOA or Letter of (LOA) is on file with Transamerica Life Canada Allowable transactions under an LPOA Death of an owner 56 Sole owner Contingent owner Multiple owners Joint Tenants in common spousal Tenants in common non-spousal Claims processing Reporting of death claims Death claim requirements Express Claims Reporting of Disability and Waiver of Premium claims Reporting of Critical Illness (CI) claims Reporting of Critical Advantage TM claims

4 Table of contents Continued Appendix 59 Forms Allocation Form (PS425) Policy Service Application (PS339) Change of Beneficiary Form (PS367) Request for Pre-Authorized Debit (PS375) Policy Change Applications (LP386) Identity and Third Party Determination Form (IP-LP782) Universal Life Fund code chart (LP946) Conversion Application (LP1285) Insurance Application (LP257) Politically Exposed Foreign Person Form (IP-LP1165) Corporate/Non-Corporate Entity/Trust Ownership Form (IP-LP1166) Notice of Transfer of Ownership (PS371) Successor Owner Form (PS373) Limited Power of Attorney (LP183) Physician s Statement Proof of Death (CL990) Report of Claim Claimant s Statement Form (CL334) Disability Supplementary Report (CL335) International Tax Classification for an Entity Form (IP-LP1601)

5 Introduction Transamerica Life Canada (TLC) Client Services If you require assistance please phone, fax or Client Services: Toll-free number box for client service inquiries Operations facsimile number for financial and non-financial service requests Client services facsimile number for client service inquiries only* Advisor login for marketing, sales and other reference information** or in Toronto, please call (416) (416) or (416) or * Please do not use this number for financial transaction requests. ** You can easily register for the advisor login at Also, information about rates and marketing materials is available without your having to sign on to the system. 4

6 How to use this document In Good Order Guide Welcome to our Life Operations In Good Order (IGO) Guide. These guidelines are applicable to all Transamerica Life Canada combined life products. This document is for in-force business only. This document outlines the IGO guidelines that Transamerica Life Canada follows with respect to the processing of life policy transactions. These guidelines are in addition to any requirements outlined in the application and policy contract. For each transaction, an IGO guideline is provided, along with the action the In-force Life Operations Business Unit will take if a transaction does not meet the guideline. Note: Current applications and forms are required at all times. Outdated forms will be considered not in good order. As many of you work with large numbers of advisors who are regionally dispersed, the demand for immediate and accurate service is essential. This is the main reason we have taken the steps to develop these guidelines: to improve the quality of service to you and your clients. Transactions that are not in good order (NGO) will be rejected, as they cannot be processed. Similarly, the Transamerica Life Products Operations Team will abide by these guidelines, and any incomplete transactions will not be processed until the transactional information received is in good order. We recommend that distributors who receive transactions from their advisors for transmission to Transamerica screen each application and/or transaction prior to submitting the transaction to the Life Products Operations Business Unit. For advisors who choose to submit transactions directly to our office, please follow these guidelines, as they are applicable to you. Incomplete transactions will be returned to the advisor or advisor s distribution office by fax for follow-up concerning the required information. In the event that Transamerica Canada Life amends certain guidelines or processes, then each distributor office will be provided with a special bulletin outlining the changes and their respective implementation dates. This IGO guide does not form part of any contract. In the event of conflict between the contract and this IGO guide, the terms of the contract prevail. 5

7 Life In-force transactions Life In-force transactions Cut-off times Financial All financial transactions (deposits, withdrawals and transfers) are processed based on the market value as at the close of business on the valuation date provided we receive at our Head Office, the instructions or transactions in accordance with our administrative rules by the valuation date cut-off time that we determine If we receive your request in good order at our head office by 3 p.m. (Toronto time) on a valuation date, this is the effective date of your request. Otherwise, the effective date is the next valuation date.. If the instructions or transactions are received after the cut-off time, they will be considered to be received on the next valuation date. We reserve the right to change the valuation date cut-off time to be earlier or later. Non-Financial We strive to provide a five-business-day service standard when processing non-financial transactions from the day the request is received in good order at our Head Office. These transactions include: address changes title changes (including beneficiary and ownership changes) bank related changes (including Pre-authorized debit, deduction date changes, mode changes and stop pre-authorized debit) 6

8 In Good Order Guide Accepted forms of payment Cheque Bank drafts/money Orders Counter cheques Transamerica Life Canada will only accept the following forms of cheque payment: pre-printed personalized cheques from an authorized bank account with remitter s name and address pre-printed by the bank. The signature on the cheque must match the owner/payor signature we have on file. corporate cheques drawn on the corporation s Canadian bank account (subject to the other third-party determination requirements for corporate accounts). cheques from a client s Canadian investment account (issued on institutional cheque forms with client account and name references). Bank drafts will be accepted under the following conditions: For amounts up to and including $500. For an amount up to $10,000 if both of the following conditions are met: The name of the remitter is pre-printed on the draft by the bank at the time of issue. The font of the remitter s name matches the font throughout the rest of the bank draft. Any dollar amount where either of the following conditions are met: Both the remitter s name and account number is pre-printed at the time of issue, the font of the remitter s name matches the font throughout the rest of the bank draft and the draft is signed by a bank manager or bank employee. The draft is accompanied by a letter from the bank on bank letterhead including bank stamp, signed by a bank manager or bank employee verifying funds were purchased by the remitter from his or her bank account. The letter is to include the remitter s name and bank account number. Acceptable for an amount up to $10,000, providing the account number is pre-printed and the signature on the cheque matches the owner/payor signature on file. Over $10,000 a bank letter is required. 7

9 Life In-force transactions Additional deposits (Universal Life) Universal life policies are eligible for additional deposits that are applied to the investment portion of the policy. The policies are tax sheltered, within specified government guidelines. It is recommended that the Life Customer Service Call Centre be contacted to determine the amount of tax shelter space available in a policy. Deposits will be allocated in accordance with instructions on the existing Allocation Form on file in Head Office. Any allocation changes require the completion of a new Allocation Form signed by the owner(s) or authorized designate. For deposit allocation(s), please see the Appendix for the Universal Life Fund Code Chart (LP946). Pre-Printed Cheque Allocation Form (PS425) Letter of direction policy number We discourage submitting investment allocations written on the cheque. Please use the Allocation Form (PS425) or provide a letter of direction. (Please refer to Accepted forms of payment on page 7.) policy number(s), policyowner and insured name(s) distributor and contracted advisor s name and code number request for an additional deposit and deposit instructions dated and signed by the policyowner(s) or authorized designate and a witness Must provide the signature of the policyowner(s) or authorized designate, including the same information as the above Allocation Form. 8

10 In Good Order Guide Cancellations/Surrenders policy number(s) plan type servicing agent and agency codes Complete Policy Service Application (PS339), use the Remarks regarding request # / or Other changes not requiring underwriting section indicating that the life insurance policy should be cancelled, or A letter of direction signed by the policyowner(s) clearly stating the request to cancel the term insurance policy. Include the signature of all policyowner(s) and the irrevocable beneficiary, assignee and trustee in bankruptcy, if applicable. If the owner is a corporation, the signature, name and title of the authorized signing officer(s) is required. NOTE: The original or a faxed request is acceptable. A witness signature is required for each authorized signature. 9

11 Life In-force transactions Full or partial surrenders/cancellations Withdrawal instructions Redemption instructions (cheque) Redemption instructions for Electronic Fund Transfer (EFT) policy number SIN GA/SA required Complete Policy Service Application (PS339), Section 4 I request a surrender in accordance with the policy provisions, or A letter of direction from the policyowner(s) or authorized designate to include the following: Whether full surrender or maximum partial surrender, or enter the specific amount of surrender, and whether gross or net. Applicable to former NN universal life policies: Provide clear instructions as to which funds are to be surrendered. If the policy is registered-mix, the client must indicate if withdrawal should be from registered or non-registered funds, or both. All redemption cheques are forwarded to the policyowner on file, unless otherwise instructed. A separate letter of direction signed by the policyowner is required to forward to the distributor or advisor on file. If no instructions are provided, the cheque will be sent to the owner s address on record. In all cases, a letter confirming the surrender details will be sent directly to the owner. A personalized pre-printed void cheque from the policyowner is needed to process an EFT directly to a policyowner s bank account. An original form or letter of direction completed/stamped by the policyholder s receiving bank indicating the account holders name (which must match the policyowner) and the bank account details. A signed request from the poliyowner to EFT to the bank account previously on file used to pay premiums under the policy (a fax is acceptable). If a request is submitted directly from the policyowner to Transamerica, an original void cheque is required. If EFT is to an account not previously on file and the request is direct from the policyowner we may call the client to confirm the banking information before processing the transaction. signature of all policyowner(s) and life insured signature of irrevocable beneficiary, assignee and trustee in bankruptcy (if applicable) If the owner is a corporation, the signature, name and title of the authorized signing officer(s) are required. A faxed request is acceptable. 10

12 Full or partial surrenders/cancellations (continued) NOTES: 1. A witness signature is required for each authorized signature. 2. Advisors may not sign surrender requests under any circumstance. In Good Order Guide Transamerica's LPOA is not applicable to surrenders. Surrender requests signed by the advisor acting on an LPOA or otherwise will be rejected. 4. If the policy is assigned, authorization from the institution holding the assignment must be received, or a release of assignment is required. 5. Where additional units of a fund were bought through a PAD, a 30-day hold period will be enforced before they can be redeemed. 11

13 Life In-force transactions Withdrawal of dividends or surrender of paid-up additions The withdrawal of policy dividends or surrender of paid-up additions is requested when a policyowner requests some or all of the dividends taken out of the policy to pay a premium, reduce or repay a loan or to receive the funds. policy number(s) plan type servicing agent and agency codes Complete Policy Service Application (PS339), Section 3 I elect to, or A letter signed by the policyowner(s) or authorized designate stating where the withdrawal should be directed Signature of all policyowner(s), irrevocable beneficiary, assignee and bankruptcy trustee if applicable. If the policyowner is a corporation, the signature, name and title of the authorized signing officer(s) are required. 12

14 In Good Order Guide Planned periodic premium change or sundry change The planned periodic premium amount is the amount of premium the client has chosen to pay on his or her universal life policy. The total amount includes the Cost of Insurance (COI) and, if desired, an additional sum to be credited to the investment portion of the policy. Planned periodic premium changes may be made in the following manner. policy number(s) servicing agent and agency codes Complete Policy Service Application (PS339), use the Remarks regarding request # / or Other changes not requiring underwriting section on this application to indicate the request to change the Planned Periodic Premium/Sundry Amount, or A letter of direction signed by the policyowner(s) or authorized designate, e.g., the payor, clearly stating the new planned periodic premium amount being requested Signature of all policyowner(s). If the owner is a corporation, the signature, name and title of the authorized signing officer(s) is required. Request is acceptable by fax, correspondence or from the distributor or advisor or AGA. NOTES: 1. A request below the minimum required premium could put your policy into shortage. 2. Pre-authorized debit payments require five business days notice prior to the scheduled payment date to change planned periodic premium payment amounts. 13

15 Life In-force transactions Premium Holiday and Shortage Provisions A Premium Holiday or Premium Skip allows clients to stop premium payments on their universal life policies for a specified time and have the cost of insurance withdrawn from the policy values, provided that there is a sufficient account or fund value available, in accordance with the policy lapse provisions regarding premiums, shortage and lapse. policy number(s) effective date for the Premium Holiday or Skip to begin/and end if applicable servicing agent and agency codes Complete Policy Service Application (PS339), use the Remarks regarding request # / or Other changes not requiring underwriting section on this application clearly stating the Holiday or Skip request, or A letter of direction signed by the policyowner(s) or authorized designate clearly stating the request for premium holiday or skip premium A phone or fax request from the Distributor, Advisor or policyowner Signature of all policyowner(s). If the owner is a corporation, the signature, name and title of the authorized signing officer(s) is required. from the distributor or advisor from a secure address. Request can be received by fax or correspondence from the distributor, advisor or AGA, owner or payor. NOTE: 1. Clients and distributors may stop a PAD over the telephone, but advisors cannot stop a PAD over the phone. 14

16 In Good Order Guide Fund transfers Fund transfers and switches are considered a single transaction in which funds are moved from one fund into a different fund within the same policy, i.e., registered, non-registered, shuttle-to-shuttle, dump-in fund, or laddering Guarantee Interest Certificate (GIC). Fund transfer instructions for fund-to fund transactions can be communicated as follows. Allocation type From To Amount to amount $5,000 from Fund A $5,000 allocated to Fund B Amount to percentage $5,000 from Fund A Allocated 50% to Fund B and 50% to Fund C Percentage to percentage 50% from Fund A Allocated 50% to Fund B and 50% to Fund C To process a fund transfer, the following information is required: Policy Originating fund information Destination fund information policy number We discourage submitting investment allocations written on the cheque. Please use the Allocation Form (PS425) or provide a letter of direction. Social Insurance Number (SIN) Provide details of proceeds to be transferred from originating fund(s), including fund code or fund name. Provide details of allocation to destination fund(s) including fund code or fund name. For some products, when depositing money to guaranteed investments, minimum deposits apply. Refer to the contract for details. If making a deposit to this coverage, complete the optional section on the Allocation Form (PS425). Allocation Form (PS425)*, or A letter of direction The signature of all the policyowner(s) or signature of the advisor, if an Limited Power of Attorney (LPOA) (LP183 LPOA) is on file. Witness signature If the policyowner is a corporation, the signature, name and title of the authorized signing officer(s) are required. * For an example of the Allocation Form PS425, please refer to the Appendix. NOTES: 1. Bulk trading is not permitted. 2. A transfer fee of $25 may be charged, depending on the product; please refer to the respective policy contract for details. 3. Allocations must total 100% if percentage allocation is provided, or if provided by dollar amount, the total must equal the deposit amount. 4. The policyowner must be contacted by the advisor and agree to the transaction before submitting the request. If advisor is signing under an LPOA, advisors should keep records of the policyowner's consent. 15

17 Life In-force transactions T2033 direct transfer While Canada Revenue Agency (CRA) no longer mandates the use of the T2033, the form is strongly recommended when transferring registered funds to or from other institutions. To initiate an additional deposit due to a transfer, the following information is required. Relinquishing institution/ policy information Receiving institution information/policy information Cheque Investment instructions name of institution full mailing address amount of deposit policy number policyowner name and life insured address SIN fund allocation instructions The cheque from the transferring institution must be current-dated (between the current date and the previous six months) and payable to Transamerica Life Canada. If no fund instructions are provided with the T2033 Form, the cheque will be deposited according to the allocation instructions on file. If instructions are provided, the deposit will be allocated according to the instructions on the transfer form, with no default in effect. RRSP deposit information must indicate whether the deposit is spousal or non-spousal. T2033 or letter of direction providing the full details as outlined above signature of all policyowner(s) 16

18 Loans or ILS loans In Good Order Guide A policy loan is a method of accessing funds from an insurance policy. Policy loans are available on Universal life and certain Wholelife plans that accumulate a cash value. Redemption instructions (cheque) Redemption instructions for Electronic Fund Transfer (EFT) policy number(s) plan type servicing agent and agency codes All redemption cheques are forwarded to the policyowner on file, unless otherwise instructed by the policyowner. A separate letter of direction signed by the policyowner is required to forward to the distributor or advisor on file. If no instructions are provided, the cheque will be sent to the owner s address on record. In all cases, a letter confirming the loan details will be sent directly to the policyowner. A personalized pre-printed void cheque from the policyowner on file is required to process an EFT. If no void cheque is available TLC will accept a form or letter of direction completed/ stamped by the policyholder s receiving bank with the bank details. If EFT is to an account not previously on file and request is direct from the policyowner we may call the client to confirm the banking information before processing the transaction. Complete Policy Service Application (PS339) Section 5, or select loan type Provide a letter signed by the policyowner(s) or authorized designate Signature of all policyowner(s), irrevocable beneficiary, assignee and bankruptcy trustee if applicable. If the policyowner is a corporation, the signature, name and title of the authorized signing officer(s) are required. 17

19 Life In-force transactions Pre-Authorized Debit (PAD) Pre-Authorized Debit allows insurance premiums to be withdrawn from the client s bank account on pre-established dates. Establishing Pre-Authorized Debit (PAD) A request to establish a PAD may be made in the following manner. policy number plan type (optional) servicing agent and agency codes (optional) For new requests for PAD, complete the Request for Pre-Authorized Debit Form (PS375), including the owner and payor name (if different), and submit it with a void cheque. To re-establish or change PAD information, provide a letter signed by the policyowner(s) and/or payor, clearly stating the new PAD request, and the effective date of bank account change. Include the signature of payor and policyowner (if different than the payor). Submit the above information with a copy of a void cheque. For an example of the Request for Pre-Authorized Debit Form (PS375), please refer to the Appendix. Non-Sufficient Funds (NSF) If the payment is returned NSF by the bank, the payment is automatically re-presented five business days from the scheduled withdrawal date. If the second payment attempt is returned NSF by the bank, the policy is removed from PAD and placed on direct quarterly billing. A letter is then sent to the owner advising that the company requires either the quarterly premium as stated in the letter or written authorization to resume PAD by the date indicated. The signature(s) of the payor(s) and/ owner(s) (if different than the payor) is required to resume the PAD. Note for all PAD changes A confirmation notice is not sent to the policyowner. However, distributor offices may verify PAD information using the webcappow system. 18

20 In Good Order Guide Resuming Pre-Authorized Debit (PAD) A request to resume PAD may be made in the following manner. policy number(s) plan type (optional) servicing agent and agency codes (optional) Request for Pre-Authorized Debit Service Form (PS375), or Complete Policy Service Application (PS339), use the Remarks regarding request # / or Other changes not requiring underwriting section on the application to clearly indicate the request to resume PAD, or A letter of direction signed by the policyowner(s) and/ payor or authorized designate, clearly stating the request to resume PAD Start date or effective date. Signature of payor and all policyowner(s) (if different than the payor). If banking information has changed, a new pre-printed void cheque is required. (Please refer to Accepted forms of payment on page 7.) Please note that if payor is changing a completed PAD form needs to be submitted. NOTES: 1. Written authorization must be received by the payment expiry date or the policy will lapse. After the 48 th day from the premium due date, evidence of insurability and the completion of the Policy Change Application (LP386) will be required to apply for reinstatement, or as outlined in the policy contract. 2. For term only: If resuming a PAD, all back premiums will be withdrawn as soon as authorization is received in the Head Office of Transamerica Life Canada A request to restart PAD is accepted from the distributor or the advisor or AGA by phone if all details remain unchanged. 19

21 Life In-force transactions Stopping Pre-Authorized Debit (PAD) A request to stop PAD may be made in the following manner. policy number(s) to which the stop PAD applies plan type (optional) servicing agent and agency codes (optional) Complete Policy Service Application (PS339), use the Remarks regarding request # / or Other changes not requiring underwriting section on the application to clearly indicate the request to stop PAD, or A letter of direction signed by the policyowner(s) /or payor or authorized designate clearly stating the request to stop PAD Effective date that the request is to take effect. or fax correspondence from the distributor or the advisor or AGA. In these instances, a confirmation notice is sent to clients to notify them of the change. A phone call from the distributor or from the policyowner /or payor only. NOTE: Advisors cannot stop PAD over the phone. 20

22 Bank change request In Good Order Guide To effectively execute a bank account change for insurance premiums withdrawn we require five business days. Bank account change requests may be made by the owner or payor in the following manner. policyowner(s) name policy number plan type (optional) servicing agent and agency codes (optional) Provide a letter signed by the policyowner(s) and/or payor clearly stating the banking change request. If the named payor or owner for the banking account is different than before, please submit a PAD Form signed by the owner and the payor. Submit the above information with a copy of a pre-printed void cheque. (Please refer to Accepted forms of payment on page 7.) A request for a bank account change can be accepted from the distributor, the advisor or AGA and the policyowner/ or payor through fax, correspondence, and , provided that we receive a copy of the pre-printed void cheque, and the signature of the payor and policyowner on the PAD Form or financial agreement, if the payor is changing; or Easy switch: provide letters from the bank on appropriate letterhead, stamped with a bank stamp and signed by a bank officer and the client. NOTE: If the payor is someone in addition to the owner, the payor must sign in addition to the owner. 21

23 Life In-force transactions Modal payment change request Modal payment changes are made when clients wish to change the frequency of their premium payments, such as moving from quarterly direct billing to annual direct billing. Policy details policyowner name and life insured policy number(s) servicing agent and agency codes (optional) Complete Policy Service Application (PS339), Section 11 "change mode of premium payment", or A letter of direction from the policyowner or authorized designate clearly stating the requested change, Signature(s) of all policyowner(s) Phone call, or fax correspondence from the distributor or the advisor or AGA. In these instances, a confirmation notice is sent to clients to notify them of the change. A phone or fax request from the Distributor, Advisor or policyowner, or An request from the Distributor or Advisor Please note that requests will not be accepted from the policyowner as identity of sender cannot be verified. NOTES: 1. When changing modes, distributors should check with the Customer Service Call Centre to determine the premium amount required to bring payments to the new modal due date. 2. A request to change to monthly PAD from a direct billing mode will require a pre-printed void cheque and a Request for Pre-Authorized Debit Service Form (PS375) with applicable signatures. 22

24 Policy Changes Adding a child to an existing rider In Good Order Guide A child may be added to an existing Children s Insurance Rider on an in-force policy under the provision outlined in the policy contract page. In order to add a new child, the following must apply: The policy must already have an existing Children s Rider coverage. The child to be added must be between 15 days old and 18 years old. The policy must not be in shortage. child(s) name, gender and Date of Birth (DOB) policy number(s) servicing agent and agency codes Complete Policy Service Application (PS339) in remarks section complete with child s name and DOB A letter of direction signed by the policyowner(s) or authorized designate indicating child s name and DOB 23

25 Policy changes Date of birth change Proof of age may be required when a life insurance application has been completed with the incorrect date of birth. all policy number(s) plan type servicing agent and agency codes Complete Policy Service Application (PS339), use the Remarks regarding request # / or Other changes not requiring underwriting section on this application to indicate the request to correct the date of birth, or A letter of direction signed by the policyowner(s) or authorized designate clearly stating the request to correct the date of birth Signature of all policyowner(s) Proof of age in the form of a government issued document such as a passport, birth certificate or driver s license 24

26 In Good Order Guide Gender correction To request a gender correction, the following is required. policy number(s) coverage number and name servicing agent and agency codes Complete Policy Service Application (PS339), use the Remarks regarding request # / or Other changes not requiring underwriting section on this application to indicate the request to correct the gender, or A letter of direction signed by the policyowner(s) or authorized designate clearly stating the request Signature of all policyowner(s), if applicable Proof of gender in the form of a government issued document such as a passport, birth certificate or driver s license 25

27 Policy changes Exercising the Non-Forfeiture Option A change in the Non-Forfeiture Option is made when the policyowner makes a request in accordance with the policy provisions, such as reduced paid-up insurance or extended term insurance. Exercising the Non-Forfeiture Option may be done in the following manner. policy number(s) plan type servicing agent and agency codes Complete Policy Service Application (PS339), use the Remarks regarding request # / or Other changes not requiring underwriting section on this application to indicate Change Policy in accordance with its non-forfeiture provisions on premium due date to Reduced Paid Up, or A letter of direction signed by the policyowner(s) or authorized designate clearly stating the non-forfeiture option that is required Signature of all policyowner(s) and of the irrevocable beneficiary, assignee and bankruptcy trustee, if applicable. If the owner is a corporation, the signature, name and title of the authorized signing officer(s) are required. 26

28 Decrease of face amount or sum insured In Good Order Guide A decrease is requested when the policyowner would like to reduce the face amount or sum insured on their policy. To request a decrease of a face amount or sum insured of a life insurance policy, the following is required. policy number(s) plan type servicing agent and agency codes Complete Policy Service Application (PS339), Section 1 Decrease Sum Insured/ Face Amount, or A letter of direction signed by the policyowner(s) or authorized designate stating request to decrease the face amount Signature of all policyowner(s) and of the irrevocable beneficiary, assignee and bankruptcy trustee, if applicable. If the owner is a corporation, the signature, name and title of the authorized signing officer(s) are required. NOTES: 1. Indicate which coverage is to be decreased and the new face amount required. 2. The minimum decrease amount is $25,000, and the face amount may not be reduced below the plan minimum. Refer to the policy contract for the minimum face amounts for each plan type. 3. Proportional surrender charges may apply to a decrease in the face amount. The policyowner must state their acceptance of the surrender charges prior to processing a decrease of the face amount or the sum insured. 4. When decreasing the face amount or sum insured on a universal life policy, indicate the new planned periodic premium requested. If at any time the new planned periodic premium amount being requested is insufficient to cover the monthly COI, Transamerica Life Canada will send a notification of shortage to the current mailing address on file, in accordance with administration rules. 27

29 Policy changes Cancellation of coverage/benefits or riders To cancel a coverage/benefits or riders from a policy, the following is required. policy number(s) coverage number and name servicing agent and agency codes Complete Policy Service Application (PS339), use the Remarks regarding request # / or Other changes not requiring underwriting section on this application to request the deletion of a specific coverage, or A letter of direction signed by the policyowner(s) or authorized designate clearly stating the coverage details to be deleted Signature of all policyowner(s) and of the irrevocable beneficiary, assignee and bankruptcy trustee, if applicable. If the owner is a corporation, the signature, name and title of the authorized signing officer(s) are required. NOTE: 1. To ensure the whole policy is not cancelled, provide as much information as possible regarding the coverage/ benefit or rider to be cancelled. 28

30 Joint coverage to single life option In Good Order Guide This option is requested when one of the lives insured or an annuitant is to be removed from the policy. In order to delete one of the lives insured, the following is required. name of life insured to be removed policy number(s) servicing agent and agency codes Complete Policy Service Application (PS339), use the Remarks regarding request # / or Other changes not requiring underwriting section on this application to request the single life option providing full details, or A letter of direction signed by the policyowner(s) or authorized designate providing full details of the request for single life option Signatures of all policyowners and of the irrevocable beneficiary(s), assignee and bankruptcy trustee, if applicable. If the policyowner is a corporation, the signature, name and title of the authorized signing officer(s) are required. Notice of Transfer of Ownership Form (PS371) and Change of Beneficiary Form (PS367) to be used only when ownership and/or beneficiary(s) are changing. A pre-printed void cheque and a PAD form (PS375) if payor or banking is changing. NOTES: 1. For Transamerica term policies, this option is only available if the policy was issued in 2001 or later. 2. If the policy is assigned, signed authorization is required, or a request of release of assignment must be submitted. 29

31 Policy changes Policy splits Policy splits are requested when the policyowners would like to split a joint or multi-life policy into separate life insurance policies. Policy splits are only acceptable on the following policies: Both Transamerica and NN UL joint policies Both Transamerica and NN Term joint policies Multi-life Universal Life policies Multi-life Term policies or Term riders on UL policies Challenger policies with a Challenger Rider or Term rider Multi-life Protector Plus policies or a Term Rider on Protector Plus policies The following is required for a policy split: policyowner(s) and insured(s) name policy number(s) plan type servicing agent and agency codes Complete Policy Service Application (PS339), Section 12 indicating which life insured is to split from the original policy, or A letter of direction clearly stating the split request Signatures of policyowners, assignee(s) and of the irrevocable beneficiary(s), if applicable. If there is a new policyowner(s) on any of the split policies, complete and submit Notice of Transfer of Ownership Form (PS371) with the policy split request for each new or original policy. We require individual forms for multiple owners. Please note that all Transfer of Ownership Forms must be signed by both the current and new owners. If there is a new beneficiary on the split policy, complete and submit a Change of Beneficiary Form (PS367) signed by the new policyowner(s), with the policy split request for each new policy. If new banking information is required for pre-authorized premium payment on the split policy, a Request for Pre-Authorized Debit Service (PS375) is to be completed and submitted with a pre-printed void cheque. NOTES: 1. For Transamerica Life contract policies only, there is a $50.00 service fee per contract issued for splitting policies. 2. For Joint-Last- last to- Die policies, a certificate of divorce is required in the case of divorce. Articles of dissolution are required in the case of business dissolution. 3. Please refer to your policy contract. 30

32 Survivorship In Good Order Guide Upon the death of the first-to-die of the lives insured, insurance may be purchased on the surviving life insured without evidence of insurability. To be eligible for this option, the following conditions must be met: A written application is received at Head Office within 90 days of the date of death of the first joint insured. The surviving life insured has not reached the maximum attained age. Please refer to your policy contract. policy number(s) servicing agent and agency codes Complete Policy Service Application (PS339), use the Remarks regarding request # / or Other changes not requiring underwriting section on this application to request the Survivorship Option and signed by the executor(s), or A letter of direction signed by the policyowner(s) or authorized designate providing full details of the request for the Survivorship Option. Notarized copy of the will, if both lives insured are the policyowners Notice of Transfer of Ownership Form (PS371) with original signatures of the executor(s) and policyowner(s) and new owner Change of Beneficiary Form (PS367) with the new owners signature Request for PAD (PS375) with void cheque, if banking is changing and if one of the owners is deceased NOTES: 1. COI will be based on the attained age and current rates of the survivor at the time the option is exercised. 2. Same class of risk is applicable to the joint insured at the date the original coverage was issued. 3. An annual policy fee will apply to the new policy. 4. Maximum purchase of insurance is the amount of insurance in force immediately prior to the date of death of the first-to-die of the lives insured. 31

33 Policy changes Switch from Joint First-to-Die (JFTD) to Joint Last-to-Die (JLTD) with deductions or premiums to last death To exercise this option, the following restrictions apply: Option is available for switches to JLTD with deductions or premiums to last death only. Must be exercised prior to age 69 of the oldest of the joint lives insured. Not available if there are more than two joint insureds under the applicable coverage. Available after the 5th or 10th policy anniversary (please refer to your JFTD policy endorsement). In order to process the transaction, the following is required. policy number(s) servicing agent and agency codes Complete Policy Service Application (PS339), use the Remarks regarding request # / or Other changes not requiring underwriting section on this application providing full details of the switch option, or A letter of direction providing full details of the switch option Signatures of all policyowners. New in-force illustration signed by all owners and by the irrevocable beneficiary(s) and assignee(s) if applicable, and submitted by the advisor. If the owner is a corporation, the signature, name and title of the authorized signing officer(s) is required. 32

34 Reduced Paid-Up (RPU) for whole life plans In Good Order Guide A client may elect to have a paid-up policy for a proportionate amount of insurance under the same policy number for which no more premium payments are required. All riders on the policy will lapse once the policy is RPU. To request a RPU, the following is required. policy number(s) Complete Policy Service Application (PS339), use the Remarks regarding request # / or Other changes not requiring underwriting section on this application providing full details of the request for Reduced Paid-Up, or A letter of direction signed by the policyowner(s) or authorized designate Signatures of all policyowners Irrevocable beneficiary signature, assignee and bankruptcy trustee, if applicable. Original contract must be submitted. 33

35 Policy changes Optimizer (universal life only) Option to automatically decrease a face amount The Optimizer Option is designed to minimize the COI over time to maximize tax sheltering. To be eligible for the Optimizer Option, the following must be in place: The starting face amount of the policy must be at least $250,000. (Please refer to your policy contract.) The COI type is Annual Renewable Term (ART). The minimum face amount may be no lower than the plan minimum. (Please refer to your policy contract.) The start date must be no earlier than either the end of the fifth or sixth policy year, as stated in the specific policy. (Please refer to your policy contract.) NOTE: All requests must be received by a letter of direction at least 30 days prior to the date the Optimization Option is scheduled to begin (or end). Termination of Optimizer Option The Optimizer Option will terminate when one of the following occurs: The COI period has ended for the coverage being optimized. The COI is changed from ART to level. The policy lapses. A written request is submitted by the owner. NOTE: Once optimization has been terminated, it may not be reactivated. 34

36 Underwriting Changes Replacements An Internal Replacement is a contractual change in the type of plan. It can be requested as a new policy or within the same policy. original policy number(s) servicing agent and agency codes Complete Policy Change Application (LP386) or current Insurance Application (LP257) Complete Insured and owner information. Complete Replacement Section 21 of the Policy Change Application (original plan, new plan type and face amount). Questions 29 through 46 must be completed as well. Current full age and amount requirements (LP1416) for each insured, including all children insured under the children s insurance rider coverage. Signature of the owner(s) and the life insured Include the date signed, location, signatures of witness(es), preferred/irrevocable beneficiary and assignee if applicable. If the owner is a corporation, the signature, name and title of the authorized signing officers are required Any additional underwriting requirements will be ordered at the Underwriter's discretion. Provide Disclosure forms (LIRD and written explanation or Disclosure form as applicable per province). Illustration and Supplementary Application if replacing to UL policies. 35

37 Underwriting changes Replacements (continued) NOTES: 1. Assured Life, T-Plan and Transaver policies can be replaced without evidence of insurability to any of the new death benefits available under Estate or Wealth Advantage Life provided the Net Amount at Risk remains the same and there is no change in the class of risk. 2. The original policy or coverage being replaced is terminated and a new policy or coverage is issued upon underwriting approval, using current date, age and rates for the new plan specified. 3. If a new business application was completed, check to ensure that question 16 b) ii is answered YES. If not, an amendment must be issued as the answer to this question is our authorization to terminate or reduce the original policy 4. The effective date of the new policy will be a current date a Term policy replacing to a new Term policy may be dated to save age, but not more than 6 months in the past. If replacing a UL policy, or term rider under a UL policy to a new Term policy, the effective date will be the nearest monthly anniversary date and cannot backdate to save age. 5. Any riders and benefits will be dated the same as the new policy date upon underwriting approval of the replacement and rider/benefit coverage. 6. The replacement policy will be dated no later than the paid-to date of the original policy. The replacement policy will take effect the same day the original policy is terminated, with no break in coverage. 7. Future or back dating is allowed up to 30 days, however, again the original policy will need to be paid to that same future date, with no break in coverage from one policy to the next. 8. The new policy cannot be backdated more than 30 days, even if the original policy has since renewed. 36

38 Non-smoker change In Good Order Guide A change from smoker to non-smoker rates may be available to clients who have not used tobacco or nicotine products for the last 12 months. All applicable inforce policy number(s) servicing agent and agency codes Complete Policy Change Application (LP386) Complete insured and owner information. Complete Section 22 Change to non-smoker Complete Questions 29 through 46. Order a urine/hiv specimen. If the case is joint last to die, evidence of insurability is required on all lives, even if only one life is changing to non-smoker. If the case is joint first to die, evidence of insurability required only on the life that the smoker change is requested. Signature of the owner(s) and the life insured. Include the date signed, location, signatures of witness(es), preferred/irrevocable beneficiary and assignee if applicable. If the owner is a corporation, the signature, name and title of the authorized signing officers are required. Any additional underwriting requirements will be ordered at the Underwriter's discretion. If the owner is a corporation, the signature, name and title of the authorized signing officers are required Any additional underwriting requirements will be ordered at the Underwriter's discretion. NOTES: 1. The effective date of the change will be the closest monthly anniversary date to the approval date provided there is no gain/loss incurred. 2. Original issue age and rates apply 3. If policy has renewed then renewal age and rates apply 4. For Joint policies, a new illustration is used to determine the new Single Equivalent Age by using the same software version, which was used at issue. 5. All children s coverage on NN policies were issued at smoker rates. To change to nonsmoker the same rules above will apply. 37

39 Underwriting changes Removal or reduction of rating/change in risk classification This section is to identify how Insureds change a rating risk class. In order to change the rating or risk class on a policy the following is required: All applicable inforce policy number(s) servicing agent and agency codes Complete Policy Change Application (LP386) Complete Insured and owner information. Complete Section 23 Reduce or Remove rating or Change in risk Classification. Complete Questions 29 through 46. If the case is joint last to die, and one life is rated and would like the rating to be reviewed, evidence of insurability is required on all lives, even if only one life is requesting a change in the class of risk. If the case is a joint first to die, only requirements will be needed on the Insured changing the risk class. Signature of the owner(s) and the life insured. Include the date signed, location, signatures of witness(es), preferred/irrevocable beneficiary and assignee if applicable. If the owner is a corporation, the signature, name and title of the authorized signing officers are required Any additional underwriting requirements will be ordered at the Underwriter's discretion. NOTES: 1. The effective date of the change will be the closest monthly anniversary date to the approval date provided there is no gain/loss incurred. 2. Original issue age and rates apply. 3. If term coverage has renewed then renewal age and rates apply. 4. For Joint policies, a new illustration is used to determine the new Single Equivalent Age by using the same software version, which was used at issue. 38