Scheme Summary. Important notice to policyholders of policies issued by National Australia Financial Management Limited ABN

Transcription

1 Scheme Summary Important notice to policyholders of policies issued by National Australia Financial Management Limited ABN

2 About this notice This notice is intended to give you a brief explanation of a proposal to amalgamate the life insurance business of National Australia Financial Management Limited (NAFiM) with the life insurance business of MLC Limited (MLC) ABN under a scheme, in accordance with the Life Insurance Act 1995 (Act). Importantly, the scheme requires confirmation by the Federal Court of Australia during a formal hearing. This notice explains: the proposed amalgamation; how the proposed amalgamation will affect you; your rights as a policyholder; and how the amalgamation occurs if it is confirmed by the Federal Court. The proposed amalgamation NAFiM and MLC are registered life insurance companies under the Life Insurance Act National Australia Bank Limited (NAB) is the ultimate parent of both companies. The proposed amalgamation of NAFiM s life insurance business with the life insurance business of MLC will allow the simplification of NAB s life insurance businesses. There is also a proposal to amalgamate the life insurance business of MLC Lifetime Company Limited (Lifetime) with the life insurance business of MLC. NAB is also the ultimate holding company of Lifetime. This also forms part of the initiative to simplify the life insurance businesses within NAB. For further information on this proposal, please refer to Further information on page 5. Mr Kevin Allport, Appointed Actuary of NAFiM and MLC, has prepared an actuarial report on the scheme. 1

3 The Appointed Actuary has formed the opinion that as a result of the scheme no policyholders of NAFiM or MLC: will have the terms of their contracts altered or affected by the implementation of the scheme; will be adversely affected by the scheme; will have reduced expectations in respect of benefits under their policies as a result of the scheme. The Appointed Actuary has also formed the opinion that the security of the benefits of NAFiM and MLC policyholders will remain adequate after the amalgamation. The Appointed Actuary s report also takes into consideration the proposal to amalgamate the life insurance business of MLC Lifetime Company Limited (Lifetime) with MLC. The Appointed Actuary has formed the opinion that the implementation of the Lifetime scheme will not adversely affect the security of benefits, the investment returns and the reasonable expectations of the NAFiM policyholders, in respect of benefits under their policies. An independent actuarial report on the scheme, by Tillinghast, has reached the following conclusions: the benefit expectations of NAFiM and MLC policyholders will not be adversely affected by the scheme; and the scheme should not materially affect the security of NAFiM and MLC policyholders. Both the actuarial report by Mr Kevin Allport and the Independent actuarial report by Tillinghast are available for you to inspect. Please refer to Further information on page 5. How the proposed amalgamation will affect you The proposed amalgamation will not change any of the terms and conditions or the benefits of any life insurance policy issued by NAFiM. 2

4 From the time the amalgamation takes effect MLC will pay all benefits, and meet all the other obligations arising under your policy, instead of NAFiM. While this means that premiums are then payable to MLC, rather than NAFiM, your existing premium payment arrangements will automatically change without you needing to do anything. References to NAFiM in your policy will by law be taken to be references to MLC. The reasonable expectations in respect of the benefits under your policy will not be reduced. Your rights The intention of both NAFiM and MLC is that policyholders will not be disadvantaged. NAFiM and MLC are satisfied that your rights are fully protected under the proposed amalgamation. As the policyholder of a policy affected by the proposed amalgamation, you may: review the scheme document and actuarial reports, obtain a copy of the scheme document free of charge, attend the Federal Court hearing and request to be heard by the Federal Court. Please refer to Further information on page 5 for details. How the amalgamation occurs Both NAFiM and MLC will apply to the Federal Court of Australia seeking confirmation of the scheme in accordance with Part 9 of the Act. The application is scheduled to be heard by the Federal Court at Sydney on 26 September 2006 at 10.15am. If the scheme is confirmed by the Federal Court, all policies NAFiM has issued will be effectively deemed to be policies issued by MLC. This happens at the time the Court determines to be the time of amalgamation. NAFiM and MLC anticipate this will be at 12.01am on 1 October MLC then assumes all the rights, benefits, obligations and liabilities of all NAFiM s life insurance business. 3

5 Statutory fund changes Your policy is currently referable to one of the NAFiM Statutory Funds. Under the scheme, the assets in the NAFiM Statutory Fund referable to your policy will be amalgamated with the assets in the MLC Limited Statutory Fund to which your policy will be referable after the date of amalgamation. Please refer to Appendix 1 to identify your policy, and the MLC Limited Statutory Fund to which your policy will be referable after the scheme takes effect. Importantly, the security of benefits provided by your policy will be maintained. The MLC Limited Statutory Funds will meet the capital adequacy and solvency requirements under the Life Insurance Act 1995 and are supported by shareholder reserves. Who pays for the scheme NAB will bear all costs associated with the scheme and proposed amalgamation, including stamp duty. No amalgamation costs will be borne by any NAFiM or MLC policyholders. Benefits to policyholders The proposed amalgamation is an important component of simplifying life insurance businesses within the Australian wealth management operations of the National Group. This process should benefit NAFiM and MLC policyholders by streamlining reporting processes and delivering some minor operational efficiencies. Policyholder enquiries Should you require further information or have any concerns about the proposed amalgamation, please call one of our Customer Service Representatives between 9am and 5pm (Melbourne time) Monday to Friday, on free call or nfm@wm.national.com.au. 4

6 Further information A copy of the scheme, scheme summary, the actuarial report on the scheme and an independent actuarial report on the scheme, and will be available for inspection by Lifetime and MLC policyholders between 9:00am and 5:00pm each day (except weekends and public holidays) from 21 August to 8 September 2006 (inclusive) at the offices listed below. Australian Capital Territory New South Wales Northern Territory Queensland South Australia Tasmania Victoria Western Australia Minter Ellison (Colleen Dillon) Level 3, 25 National Circuit, Forrest, Australian Capital Territory MLC Limited (Greg Moss) Reception, Miller St, North Sydney Minter Ellison (Lachlan Drew) Level 4, 66 Smith Street, Darwin Minter Ellison (Dianna Henry) Waterfront Place, 1 Eagle Street, Brisbane Minter Ellison (Brett Thorneycroft) Reception 1 King William St, Adelaide Dobson, Mitchell and Allport (Andrew Walker) Reception, 59 Harrington Street, Hobart National Australia Bank Limited (Geoff Hyde), Reception, 800 Bourke St, Docklands, Melbourne MLC Limited (Helena Jakupovic) Level 17, 216 St Georges Terrace, London House, Perth You can also obtain a copy of the scheme by phoning us on free call between 9am and 5pm (Melbourne time), Monday to Friday, or by ing us at nfm@wm.national.com.au or by downloading a copy from or 5

7 Rights to attend or be heard at the Federal Court hearing Any policyholder or person who may be affected by the scheme is entitled to be heard at the court hearing. Any person who wishes to appear before the Federal Court is requested to phone us on free call or to contact Bruce Ramsay of Freehills on (02) by 25 September Proposal to amalgamate the life insurance businesses of MLC Lifetime Company Limited and MLC Limited A copy of the scheme summary for this proposal is available at or Alternatively, you can obtain a copy of the scheme summary by phoning us on free call between 9am and 5pm (Brisbane time), Monday to Friday. Appendix 1 NAFiM policies to be amalgamated The table in the scheme summary will show the products, the statutory fund that issued the product and the statutory fund to which the product will be transferring. NAFiM Product NAFiM Statutory Fund Fortis Protector Term Life Fortis Income Protector Life Builder Income Protection Insurance National Accident Cover National Accident Plan National Asset Builder 2 3 National Australia Extra Cash Hospital Plan MLC Limited Statutory Fund 6

8 NAFiM Product NAFiM Statutory Fund National Australia Life Cover National Australia Life 3 1 Salary Continuance National Australia Term Life Cover National Australia Life 3 1 Mortgage Protection National Business Expenses National Business Life National Business Life Insurance National Business 4 2 Super Bond National Credit Card Cover National Easycover National Family Life National Flexible 5 4 Income Plan National Flexible Pension 5 4 Plan National Flexibond 2 3 National Group Disability Income Benefit National Group Disability 3 1 Income Benefit National Group Life and Total and Permanent Disablement National Group Life and Total and Permanent Disablement National Guaranteed Cover Plan National Guaranteed Income Plan MLC Limited Statutory Fund 7

9 NAFiM Product NAFiM Statutory Fund National Income Protection Insurance National Income Protection National Income Protection Plus National Investment Bond 2 3 National Life Plus National LoanCover National LoanSafe National Men s ReCover National MortgageSafe National Managers Club 3 1 National Personal 4 2 Super Bond National Pooled 4 2 Super Bond National Pooled 4 2 Super Fund National Primecare National Protection Plan Business Expenses National Protection Plan National Term Life National Protection Plan National Income Protection National Income Protection Plus National Business Expenses National Protection Insurance National Retirement Savings Account 3 1 MLC Limited Statutory Fund 8

10 NAFiM Product NAFiM Statutory Fund National Rollover Bond 4 2 (Series 1-3) National Rollover 4 2 Parking Bond National Super Bond 4 2 National Super Star 4 2 (Series 1 & 2) National Super Pension Plan 3 1 National Tailored Plan National Term Life Insurance National Term Life National Trauma Care National Tailored Group Protection National Tailored 3 1 Group Protection National Women s ReCover Staff Income Protection Tax Paid Savings Bond 2 3 Term Life Cover Yearly Renewable Term MLC Limited Statutory Fund 9

11 For more information, call NAFiM on freecall am 5pm (Melbourne time), Monday to Friday or visit us at national.com.au 2006 MLC Limited ABN AFSL (08/06)