ABOUT AVIVA Aviva Life and Annuity Company is part of Aviva USA, one of the fastest-growing life insurers in the United States, with more than 1,115,000 customers and 32,850 agents and distributors. We offer a competitive portfolio of longterm savings, insurance and retirement income products designed to help customers make the most out of life. Aviva USA is part of Aviva plc, the world s fifth-largest insurance group, with a corporate lineage dating back to 1696. Advantage Builder II Indexed Universal Life This brochure contains highlights only. You should refer to the Advantage Builder II Indexed Universal Life policy for a full explanation. All tax related information contained herein is based on our current understanding of federal tax laws as they relate to life insurance or other subject matter discussed. These laws are subject to change in the future. Neither Aviva nor its representatives offer legal or tax advice. You should consult a personal tax advisor on any tax matters. In order to comply with certain U.S. Treasury regulations, please be advised of the following: Unless expressly stated otherwise, any U.S. Federal tax advice contained in these materials, including attachments, is not intended or written to be used, and cannot be used, by any person for the purpose of avoiding any penalties that may be imposed by the Internal Revenue Service. Products issued by and all policy benefits are the responsibility of Aviva Life and Annuity Company, and not that of any other insurer or company. * Pg 5 As with most universal life policies, the cash value is determined by the sum of premiums paid net of any loads, deductions of policy charges, plus interest credited. Policy charges are deducted monthly and include a flat administrative fee, an expense charge based on face value issued, cost of insurance charges, and charges for any riders. * Pg 8 This policy is designed for long-term accumulation and not for short-term liquidity. However, if your needs change, the policy allows you to withdraw all or part of the cash value subject to certain limitations. Withdrawals may be subject to surrender penalties imposed by the company. Amounts withdrawn may also be subject to tax liability or tax penalties. Partial surrenders and loans may affect policy values and death benefits. Aviva does not provide tax, legal or accounting advice; always consult your own personal advisor for tax, legal, or accounting advice. Policy form 2EDB08. Availability may vary by state. Products Issued by Aviva Life and Annuity Company 611 5th Avenue Des Moines, IA 50309 www.avivausa.com Consumer product guide 16481 3/09 16481 3/09
Advantage Builder II The uncertainty of tomorrow makes today s decisions even more important. Life insurance as part of your overall financial plan can be one way to protect your family from the unknown events of tomorrow while building a solid foundation of financial security for the future. The choices, flexibility and guarantees afforded you with Indexed Universal Life insurance from Aviva are unmatched anywhere else. Indexed Universal Life from Aviva can help you Products issued by Aviva Life and Annuity Company. Indexed Universal Life This policy description provides highlights and does not cover all restrictions, conditions or limitations that may apply. Consult your agent or see the policy for full details. Benefits may be limited or excluded during the first two years of your policy under suicide and contestibility provisions. n Protect Your Loved Ones If something happened to you, what would happen to your spouse and children? Would they carry on as always, or would they be faced with financial hardship? You can ensure they have the funds to pay off the mortgage, leaving a debt-free home to your loved ones, or the funds to meet daily expenses and replace income, allowing their lifestyle to continue. n Plan for Your Future By accessing your policy values, you may be able to significantly enhance the funds available for your retirement. This supplemental retirement income in most cases accumulates tax-deferred and may even be tax-free! You may also gain access to these funds prior to retirement through the loan provisions in your policy. n Leave a Legacy Leave a legacy to pass along to your heirs. Allow as much of your estate as possible to be passed along, rather than having a disproportionate amount sacrificed to pay taxes. Life insurance may be able to allow your estate to be maximized while your tax obligations are satisfied. Proceeds from your policy may also be used as a contribution to a charity you may hold close to your heart, allowing for a lasting legacy of your generosity. With Advantage Builder II Indexed Universal Life, you decide how your policy will work for you. With its flexible design, the choice is yours! 1 2
With an Indexed UL Policy, You Can Take Advantage of n Flexible premium payments and death benefit options n An array of riders to customize the policy for your needs n The options of taking policy loans and withdrawals (subject to policy specifications) n An index-linked interest crediting approach that includes a guaranteed minimum interest rate while providing the potential for more growth than most traditional life insurance products n Proceeds that are in most cases income taxfree to the beneficiary upon your death and cash values that typically accumulate taxdeferred The Coverage You Need Advantage Builder II Indexed UL is a flexible policy that can fit many needs. With face amounts beginning at $100,000, a variety of riders from which to choose and several interest crediting options, your policy can be customized for your individual situation. 3 4
Why Index-Linked Interest Crediting? Advantage Builder II IUL is an indexed universal life insurance policy. The major difference between traditional universal life and indexed universal life is the way interest is credited. While the account value of a traditional UL policy is credited with interest based on a rate periodically declared by the insurer, an indexed UL policy earns interest based in part on the movement of a stock market index, excluding dividends. We believe that an indexed life product has the potential over the life of the policy for greater interest crediting than the more traditional products. Consequently, this could mean more cash value and more supplemental retirement income, as well as the option of having lower total premiums if you wish to use the policy cash value to support the internal expenses. Here s How It Works: When you apply for your policy, you choose from the available interest crediting strategies (described on the next page). We then follow a few steps for premium direction, as outlined below. When you make a premium payment, the net premiums go into the Basic Interest Strategy. That money remains in the Basic Interest Strategy until there is enough to cover approximately one year s cost of insurance and other policy charges.* (See back cover) Funds in excess of this amount may then be directed to the other strategies as described below. Funds in the Basic Interest Strategy earn a fixed interest rate determined by the company. PREMIUM DOLLARS (Net of Sales Charges) BASIC INTEREST STRATEGY Excess dollars from the Basic Interest Strategy create interest crediting segments (depending on the strategy or strategies that you choose). Segments are created two times each month when amounts are available from the Basic Interest Strategy. Over time, a policy will likely contain many active interest crediting segments. At the end of each indexed strategy crediting period (and monthly with fixed strategies), interest is applied according to strategy specifications and interest credits, if any, for that period are locked in. CHOOSE FROM SEVEN INTEREST CREDITING STRATEGIES At the end of every segment term (1, 5 or 6 years, depending on the strategy), the segment dollars mature and are placed back into the Basic Interest Strategy, along with any new premium, to begin working for you again. MATURED VALUE 5 6
As a leader in indexed life insurance products, we ve created several interest crediting strategies 1 from which to choose: n One-Year Fixed n Five-Year Fixed n One-Year Point-to-Point (five-year term) n One-Year Multi-Index (five-year term) n One-Year Monthly Cap (five-year term) n One-Year Monthly Average (five-year term) n Two-Year Point-to-Point (six-year term) Although an external index may be used to determine interest credited to your policy values, the policy does not directly participate in any stock or equity investments. You are not buying shares of any stock or index. Advantage Builder II IUL simply uses stock market indices as a measuring stick. Any resulting indexlinked credits subject to the limitations of the policy and strategy(ies) chosen are credited to the cash value of the policy. Credits are subject to participation and cap rates. n Interest Rate Guarantee Advantage Builder II IUL provides a guaranteed minimum interest rate of 2%. On the fixed-term strategies, the policy guarantees that the declared interest rate will never be less than 2%. On the indexed strategies, the policy guarantees that the interest credited will never be less than 2% compounded annually over the segment term. The guarantee will be applied at the end of the segment term or upon lapse, surrender or maturity of the policy, whichever occurs first. 2 n Account Value Enhancement Beginning with the 10th policy year, Aviva will credit an annual increase to the Basic Interest Strategy based on the policy year s average monthly account value (excluding outstanding loans and interest under the Annually Declared (Fixed) Loan Interest Option) for that year. The account value enhancement is guaranteed to be 0.5% per year and is credited at the end of the year. For more details about how this indexed life policy works, please talk to your agent and refer to our brochure Understanding Indexed Life. n Other Factors Affecting Interest Crediting Any money removed from an indexed strategy segment during an interest crediting period for any reason (e.g., withdrawal, certain loans, policy surrender, to pay policy charges or expenses, etc.) is not credited with any index-linked interest for such interest crediting period. n Loans and Withdrawals* (See back cover) At any time, you can take a loan from available policy values and choose between a variable loan interest rate or a fixed interest rate. The differences between these two options include how the loan interest is determined and the rate credited to amounts borrowed. Loans will reduce the policy s death benefit and cash values until they are paid back. You can also simply withdraw money from the policy after the first year, which then reduces the death benefit and the cash value by the amount of the withdrawal. Tax consequences and/or surrender charges could also apply. Pro-rata surrender charges are not assessed on the first 20% withdrawn. 1 Strategies may not be available in all states. Dollars in strategies can be redirected at the end of each segment term. 2 In Pennsylvania, the interest credited will never be less than 1% per year and 2% compounded annually over each index strategy segment. The 2% guarantee will be applied at the end of the segment term or upon lapse, surrender or maturity of the policy, whichever occurs first. Our detailed annual statements showing the cash value and death benefit will keep you informed about your policy s performance. 7 8
More Options to Enhance Your Policy* You can choose among the following riders and options designed specifically to complement the Advantage Builder II IUL to further help you meet your financial goals, protect your loved ones from uncertainty and potentially improve the overall performance of the policy. FOR THE PRIMARY INSURED Wellness for Life Rider Includes wellness services from Mayo Clinic Health Solutions Live longer, feel better, & SAVE! Aviva s Wellness for Life Program is a unique rider to your life insurance policy that s designed to help you realize the benefits of living a healthy lifestyle. Now, when you purchase life insurance through Aviva, you can elect to add the rider to take advantage of services from Mayo Clinic Health Solutions that may help maintain or improve your health and potentially participate in rewards that reduce the cost of insurance! For more information on this rider contact your Aviva representative. Wellness Program Rewards may be even greater when coupled with the No-Lapse Guarantee Rider. If the NLG is elected on a policy, any Wellness Rewards will count toward NLG premium, in effect reducing the out-ofpocket premium requirement for this rider. (Form 2WFLAJ07-2) It is anticipated that Wellness for Life services will be provided by Mayo Clinic Health Solutions for the life of the Program. But since your life insurance policy may remain in force for many years, it is possible that the provider and/or menu of wellness services may change or be enhanced at some future date. Accelerated Death Benefit Rider Up to 50% of the death benefit (up to a maximum of $250,000) can be withdrawn for expenses related to terminal illness when life expectancy is 12 months or less. There is no additional premium charge for this rider. A processing fee will apply at time of exercise. (Form 2ABRF06) Life Protector Rider** Provides for a paid-up policy when certain policy and policy loan conditions are met. Prevents the policy from lapsing as a result of loan indebtedness. (Form 2PUEBI06) Accidental Death Benefit Rider Death benefit amount is increased in the event of death as a result of an accident. (Form 21024F02) Guaranteed Purchase Option Rider Gives you the option of purchasing additional specified amounts of life insurance, without underwriting, at specified times. (Form 21011F02) Death Benefit Return of Premium Rider Provides an additional, increasing death benefit equal to the premiums paid, accumulated with interest, less withdrawals, if desired. (Form 2ROPBB08) No-Lapse Guarantee Rider + When attached to our Advantage Builder II IUL policy, the No-Lapse Guarantee Rider can provide a guaranteed death benefit for the lifetime of the insured individuals. This rider is designed to keep the policy in force even if the cash surrender value falls to zero, provided the required premiums are paid on a timely basis. You choose the length of guarantee and the corresponding number of premium payments, with lower premiums available based on health. And if your premium payments fall below the level needed to keep the rider in force, the No-Lapse Guarantee enters a five-year restoration period in which premiums can be paid to catch up and restore the rider. When coupled with the Wellness for Life Rider, any Wellness Rewards will count as NLG premium, in effect reducing the out-ofpocket premium requirement for this rider. This valuable rider is available only at the time of policy issue. (Form 2NLEDB08) FOR OTHER INSUREDS Additional Insured Rider Provides term life insurance protection for an additional person. (Form 21052F02) Children s Insurance Rider Provides term life insurance for children of the insured. Issue ages of children are 15 days through 17 years. (Form 2CIBUA09) Primary Insured Rider Provides additional level term insurance protection for the insured. (Form 2PIREBB08) Waiver of Monthly Deduction Rider Monthly insurance costs are waived in the event the insured becomes totally disabled. Not available with the Waiver of Specified Premium Rider. (Form 21042F02) Waiver of Specified Premium Rider Based on a specified amount chosen at the time of application, a monthly premium amount will be credited to your policy beginning after six months * Riders are subject to state availability, certain limitations, and may require additional charges unless otherwise specified. See terms of the rider for full details. ** The tax treatment of this rider, if activated, is not well settled under current law. In particular, it is not clear whether the rider will result in a taxable event at the time it is activated. Anyone contemplating the purchase of the policy with this rider should consult a tax advisor as to the possible tax ramifications associated therewith. + The No-Lapse Guarantee Rider is called the Extended Guarantee Rider in Connecticut and the Death Benefit Guarantee Rider in Illinois. Certain policy changes can void the 9 of total and continuous disability. Not available with the Waiver of Monthly guarantee. See rider form for complete details. Charges for this rider apply. Deduction Rider. (Form 21043F02) 10