INCOME PROTECTION POLICY DOCUMENT

INCOME PROTECTION POLICY DOCUMENT For Employees (as Voluntary Insured Members) Participating Employer (Universities of NZ) (the employer) Administered by Marsh (the policy owner) Insured by Sovereign Assurance Company Limited 74 Taharoto Road Takapuna North Shore City 0622 Private Bag Sovereign Victoria Street West Auckland 1142 UnIP 05/11

Contents 1.0 THIS POLICY... 3 2.0 INTERPRETATION... 3 3.0 MEMBERSHIP... 6 Minimum Policy Terms... 6 Eligibility... 6 Automatic Acceptance Limit... 6 Underwriting Terms... 7 Sovereign s Ongoing Membership Requirements... 7 4.0 TAKEOVER TERMS... 8 5.0 START OF COVER... 8 6.0 PREMIUMS... 9 Payment of Premiums... 9 Guarantee of Standard Premium Rates... 9 Variation of Members Premiums... 9 7.0 BENEFITS... 10 General... 10 Deduction of Tax... 11 What are the Benefits?... 11 Total Disability Benefit... 11 Partial Disability Benefit... 12 Vocational Retraining Benefit... 13 Rehabilitation Expense Benefit... 13 Bed Confinement Benefit... 13 Bereavement Support Benefit... 14 Waiver of Waiting Period for Recurring Disability... 14 Indexation of Monthly Benefit... 14 Spouse Benefit... 14 8.0 OTHER COVER... 15 Cover During Unpaid Leave... 15 Worldwide Cover... 15 9.0 EXCLUSIONS... 16 Member Exclusions... 16 10.0 CLAIMS... 16 When a Benefit Is Payable... 16 Claim Criteria... 16 Payment of Benefit... 18 Reduction of Benefit... 18 Non-Payment of Benefit... 19 Regular Assessments... 19 11.0 TERMINATION... 20 Termination of this Policy... 20 Termination of Membership... 20 When Can Sovereign Cancel Your Membership?... 21 12.0 CONTINUATION OPTION... 21 13.0 GENERAL... 23 Incorrect or Incomplete Information... 23 Term Insurance... 23 Records... 23 Notices... 23 Payments... 23 Privacy... 23 Variation... 24 Non Assignment of Policy... 24 Governing Law... 24 Free Look... 24 UniIP 0511 Page 2

CONDITIONS 1.0 THIS POLICY 1.1 This policy document, its Schedules, the proposal documents and any declarations make up this policy, issued by Sovereign. 1.2 This policy is a voluntary workplace policy which provides insurance cover for more than one person under a group master policy. Such persons are referred to as members. 1.3 Under this policy, Sovereign will pay a benefit for the reason(s) set out in condition 7. 2.0 INTERPRETATION 2.1. Italicised words and phrases in the policy have the meanings specified herein. 2.1.1 accident means bodily injury to the member caused by visible, violent and external means in relation to the member. 2.1.2 actively employed means the person is not prevented by accident or sickness from properly performing his/her normal duties of paid permanent employment. For the sake of clarity, permanent employment means the person has an individual agreement of either indefinite duration, or for a fixed term, with the employer requiring the person to perform identifiable duties for a regular number of hours of no less than 15 hours each week. 2.1.3 annual salary (if benefits are salary related) means the yearly rate of base salary or wages applicable to the member as notified to Sovereign by the Policy Owner when membership commences, and subsequently at each policy anniversary date. 2.1.4 automatic acceptance limit has the meaning assigned to it in Schedule 1 or such other amount Sovereign may advise the Policy Owner in writing from time to time by giving at least 90 days written notice. The automatic acceptance limit is only available to those employees who qualify for the automatic acceptance limit. Automatic acceptance limits do not apply to spouse applicants. 2.1.5 bed confinement benefit, if applicable, has the meaning assigned to it in conditions 7.19 and 7.20. 2.1.6 benefit, subject to the provisions of this policy, means any or all of the following benefits in respect of a member that are payable prior to the benefit expiry date or the termination of a member s membership: a) total disability benefit; b) partial disability benefit; c) vocational retraining benefit; d) rehabilitation expense benefit; e) bed confinement benefit; f) bereavement support benefit. 2.1.7 benefit expiry date has the meaning assigned to it in Schedule 1. 2.1.8 benefit payment period has the meaning assigned to it in Schedule 1. UniIP 0511 Page 3

2.1.9 bereavement support benefit has the meaning assigned to it in condition 7.21. 2.1.10 business day means a day, other than Saturday or Sunday or a public holiday observed in New Zealand (including any provincial anniversary day). 2.1.11 conditions means these conditions contained in the policy, other than special conditions contained in Schedule 1. 2.1.12 CPI means the latest annual Consumer Price Index (All Groups) published by Statistics New Zealand as at the effective date of the relevant calculation under this policy. If the CPI is no longer published, Sovereign will use a similar index. 2.1.13 date of disablement means the later of the date of an accident or sickness giving rise to a disability under this policy, and the last day the member is actively employed with the employer. 2.1.14 disability means a total disability or partial disability under this policy, whichever is applicable from the context. Disabled has a corresponding meaning. 2.1.15 eligibility criteria has the meaning assigned to it in Schedule 1. 2.1.16 employer has the meaning assigned to it in Schedule 1. 2.1.17 fraudulent and fraudulently means in respect of a statement fraudulently made by a person, that the person making it makes it: Knowing it is incorrect; or Without belief in its correctness; or Recklessly, without caring whether it is correct or not. 2.1.18 guarantee date has the meaning assigned to it in Schedule 1. 2.1.19 indexation of benefit, if applicable, has the meaning assigned to it in condition 7.23. 2.1.20 initial period means the period of time set out in Schedule 1. 2.1.21 insured income has the meaning assigned to it in Schedule 1. 2.1.22 material has the meaning that a statement or fact is material only if that statement or fact would have influenced the judgement of a prudent insurer in fixing the premium or in determining whether he/she would have taken or continued the risk upon substantially the same terms. 2.1.23 maximum benefit has the meaning assigned to it in Schedule 1. 2.1.24 medical practitioner means a legally qualified and registered medical practitioner acceptable to Sovereign other than the insured member, the partner, the child or other family member, business partner or associates of either the member or his/her employer. 2.1.25 member means an employee of the employer who has fulfilled the eligibility criteria, and who continues to satisfy the conditions of membership as set out in this policy. Member shall include a spouse member unless otherwise stated. UniIP 0511 Page 4

2.1.26 membership means a member or spouse member that has been accepted for and is covered for benefits under the terms and conditions of the policy. 2.1.27 partial disability benefit means the benefit calculated in accordance with condition 7.13. 2.1.28 partially disabled refers to a member who: a) Immediately after at least an initial period of total disability, returns to work; and b) Solely because of the continuation of the sickness or accident which caused the total disability, is working in a reduced capacity, or is capable of working in a reduced capacity; and c) Earns a monthly income that is less than 75% of his/her monthly pre-disability income; and d) Is under the regular care of, and following the advice of, a medical practitioner. 2.1.29 partial disability has a corresponding meaning. 2.1.30 policy means this Workplace Income Protection Policy and the Schedules attached to it, as amended from time to time by Sovereign. 2.1.31 policy anniversary date has the meaning assigned to it in Schedule 1. 2.1.32 policy commencement date has the meaning assigned to it in Schedule 1. 2.1.33 Policy Owner has the meaning assigned to it in Schedule 1. 2.1.34 policy year means 12 months from the policy anniversary date and each 12 months thereafter. 2.1.35 pre-disability income means the member s annual salary as disclosed at the last policy anniversary date, or what was accepted upon application, whichever is later, or such other amount as notified and agreed to in writing by Sovereign. 2.1.36 premium due dates has the meaning assigned to it in Schedule 1. 2.1.37 rehabilitation expense benefit has the meaning assigned to it in condition 7.18. 2.1.38 sickness means any illness, disease or disorder contracted by the member. 2.1.39 Sovereign means Sovereign Assurance Company Limited, a registered company at Auckland, New Zealand. 2.1.40 specified occupation means the occupation of the member immediately prior to the date of disablement. 2.1.41 spouse means the person to whom the member is currently married and with whom the member is living, and also includes any person with whom, in the opinion of the Policy Owner, the member is living in a relationship in the nature of a marriage, irrespective of gender. 2.1.42 spouse benefit has the meaning assigned to it under conditions 7.24 to 7.30 inclusive. UniIP 0511 Page 5

2.1.43 spouse member means a spouse who has been accepted for membership under this policy and who continues to satisfy the conditions of membership as set out in this policy. 2.1.44 term life insurance policy means a policy as defined in Regulation 45 of the Securities Regulations 2009 that is not a security or a life insurance policy for the purposes of the Securities Act 1978. 2.1.45 total disability has the meaning assigned to it in Schedule 1. 2.1.46 total disability benefit has the meaning assigned to it in Schedule 1. 2.1.47 unpaid leave means leave without pay to undertake travel, full time study, maternity leave, paternity leave, parental leave, compassionate leave, sabbatical leave, sick leave or other such leave agreed to by Sovereign. 2.1.48 vocational retraining benefit has the meaning assigned to it in conditions 7.16 and 7.17. 2.1.49 waiting period has the meaning assigned to it in Schedule 1. 2.2 The headings are for convenience only and are not relevant to the interpretation of the conditions. 2.3 Expressions referred to in Schedule 1 have the same meanings within the policy document. 2.4 Singular includes plural. 3.0 MEMBERSHIP Minimum Policy Terms Eligibility 3.1 Any employee (who is not a spouse) who meets the eligibility criteria, and who qualifies for an automatic acceptance limit, will be eligible to be insured for the benefits specified in Schedule 1 from the date the application is accepted by Sovereign, or at some other time Sovereign agrees in writing with the Policy Owner. Automatic Acceptance Limit 3.2 Any employee (who is not a spouse), who does not qualify for an automatic acceptance limit, on satisfying the eligibility criteria, may be accepted for insurance under this policy subject to the provision of underwriting in accordance with condition 3.7 to 3.9 inclusive. 3.3 A spouse applicant of an accepted member, on submitting an application, may be accepted for insurance under this policy subject to the provision of underwriting in accordance with condition 3.7 to 3.9 inclusive. 3.4 The automatic acceptance limit is only available to those employees who qualify for the automatic acceptance limit as shown in Schedule 1. Applicants that are not eligible for the automatic acceptance limit will be underwritten in accordance with conditions 3.7 to 3. 9 inclusive. 3.5. Spouse applicants are not eligible for any automatic acceptance limits. 3.6 The automatic acceptance limits in place at any time are reviewable at each annual policy anniversary date. UniIP 0511 Page 6

Underwriting Terms 3.7 For those persons: a) Who do not meet the eligibility criteria; or b) Where the amount of the benefit applied for is in excess of the automatic acceptance limit; or c) Where the amount of the benefit, as a result of an increase in the benefit, is in excess of the automatic acceptance limit or any previously agreed variation to the automatic acceptance limit; or d) Where the automatic acceptance limit is nil, does not apply, or is outside of any automatic acceptance limit offers; or e) Who are spouses applying for a spouse benefit; cover (or where applicable, the cover that is in excess of the automatic acceptance limit), will be subject to underwriting terms set out in condition 3.8. 3.8 Underwriting means that Sovereign will only agree to provide the benefit, or an increase in the benefit, for a member or spouse member, if the following conditions are met: a) The Policy Owner and member provide any information (including, but not limited to, medical information) Sovereign requires for assessment. Sovereign will notify the Policy Owner what information is required; and b) Sovereign approves the benefit, or increase in benefit, as the case may be. 3.9 Sovereign will notify the Policy Owner of its decision where a non-standard premium applies, or if the insurance is declined. Sovereign will also notify the Policy Owner when the cover or the increase to the cover will commence. Sovereign will advise any special restrictions or exclusions applicable to the member s cover directly to the member. Sovereign s Ongoing Membership Requirements 3.10 Within 30 days (or such extended period agreed by Sovereign) of each policy anniversary date, the Policy Owner will provide Sovereign with a certificate and/or schedule showing: a) The name, gender, date of birth, annual salary (if benefits are salary related), hours of work per week, employer, location of employment (if outside of New Zealand) of all members at the policy anniversary date; and b) Such other information in respect of all members as Sovereign, by written notice, advises the Policy Owner it requires. 3.11 From time to time, the Policy Owner will provide Sovereign with any information Sovereign advises is necessary for the purposes of the policy, including but not limited to the payment of any claims. UniIP 0511 Page 7

4.0 TAKEOVER TERMS 4.1 If this policy is taken out to replace an existing income protection policy ( Previous Policy ) providing the same or substantially similar benefits, as indicated in Schedule 1, and Sovereign is satisfied with the underwriting standards applied by the insurer to the Previous Policy, Sovereign may offer takeover terms as indicated in Schedule 1. The applying member will need to provide any relevant information requested by Sovereign in relation to the Previous Policy, including but not limited to its operation, terms and claims history. 4.2 Sovereign will advise the Policy Owner of its decision in writing, including any conditions or special terms relating to the takeover of the Previous Policy. 4.3 Takeover terms will be subject to the following requirements: a) The applying member meets the eligibility criteria; and b) Where the amount of the benefit under this policy is higher than any benefit under the Previous Policy, underwriting terms in accordance with conditions 3.7 to 3.9 inclusive will apply to that part of the cover which is in excess of the automatic acceptance limit (if the applicant qualifies for the automatic acceptance limit); and c) Sovereign may apply any equivalent restrictions, conditions or limitations which the previous insurer applied under the Previous Policy; and d) The Previous Policy must have been fully underwritten by the previous insurer within the last 5 years; and e) The applying member must be aged 55 years or under; and f) The Previous Policy must be an Indemnity benefit; and g) The employee must be a permanent employee working regular hours of at least 30 hours per week; and h) No claim has been submitted, notified or paid in relation to the Previous Policy; and i) The benefits on the Previous Policy provide the same or substantially similar benefits to the cover applicable under this policy; and j) A maximum takeover amount will apply as shown in Schedule 1. 5.0 START OF COVER 5.1 Cover for any applied benefits will commence upon acceptance of the application by Sovereign, or at some other time Sovereign notifies the Policy Owner. This will occur upon, but not limited to, Sovereign being satisfied that the eligibility criteria and any applicable underwriting requirements or takeover terms have been met and accepted by Sovereign. UniIP 0511 Page 8

6.0 PREMIUMS Payment of Premiums 6.1 While the policy is in force a policy premium, being the total of all premiums charged in respect of all members, is collected and payable by the Employer to the Policy Owner, and from the Policy Owner to Sovereign, on or before the premium due dates, or as otherwise agreed. 6.2 Subject to conditions 6.7 to 6.14 inclusive, the premium charged in respect of each member will be as calculated in accordance with the Premium Rate Schedule, or such other amount notified by Sovereign to the Policy Owner from time to time. 6.3 If Sovereign does not receive the full premium within 30 days after a premium due date, or any premium adjustment amount owing within 30 days of the due date (or such extended period allowed by Sovereign), Sovereign may terminate the policy (with effect from the premium due date) by written notice to the member and/or Policy Owner. 6.4 If an insured event happens before the policy is terminated, whilst premiums are still owing, Sovereign will pay any benefits a member is entitled to once that member has paid Sovereign all premiums which are due and owing. 6.5 The members employer, on written notice to the Policy Owner, may discontinue to collect premium payments at any time for particular members. If the employer fails to pay the premium for particular members within the period of grace of 30 days (or such extended period allowed by Sovereign) following the relevant premium due date, the employer will be deemed to have discontinued premium payments and the policy will terminate in respect of the relevant members with effect from the said premium due date. 6.6 The Policy Owner on written instruction from the employer may discontinue to on-pay future premium payments at any time for all members. If the Policy Owner fails to pay the premium for all members within 30 days (or such extended period allowed by Sovereign) following the relevant premium due date, the Policy Owner will be deemed to have discontinued premium payments and the policy will terminate with effect from the said premium due date. Guarantee of Standard Premium Rates 6.7 Subject to conditions 6.8 to 6.14 inclusive, the standard premium rates referred to in Schedule 2 are guaranteed by Sovereign until the guarantee date specified in Schedule 1. Variation of Members Premiums 6.8 Sovereign reserves the right to vary the standard premium rates set out in Schedule 2 after the guarantee date by giving at least 90 days written notice to the Policy Owner. 6.9 If a member s age or smoking status is incorrectly advised to Sovereign, the difference between the total premium paid in respect of that member and that which would have been payable if the member s age or smoking status had been correctly stated, will be paid by the member to Sovereign or repaid by Sovereign to the member, as appropriate, if considered material by Sovereign. UniIP 0511 Page 9

6.10 Sovereign may vary the standard premium rates referred to in Schedule 2 at any time in the event of war (whether declared or undeclared) in which New Zealand is involved, or the armed invasion of New Zealand. 6.11 Sovereign may vary the standard premium rates referred to in Schedule 2 at any time if there is a change either in the number of members covered by the policy or the total aggregate benefits for all members of 25% or more in any one policy year. 6.12 Sovereign may give notice to vary the premium rates at a policy renewal if the occupational profile of the employees of the employer undergoes a significant change from the current occupational profile upon which the plan was assessed for premium rating purposes. 6.13 This policy was prepared on the basis of the legislation and taxation regime applicable at the date of execution of this policy. Sovereign reserves the right to adjust the premium rates in Schedule 2, at any time, in response to alterations to the legislative or taxation environment. 30 days written notice will be given to the Policy Owner of any such changes. 6.14 If Sovereign becomes aware of any occupational, claims or other information or data material to its assessment of premium rates and which has not been previously advised to it by the Policy Owner, or becomes aware of any material errors in any such data, Sovereign may immediately vary the standard premium rates referred to in Schedule 2 or adjust the benefit payable in respect of a member or members, as it considers appropriate. Sovereign may also charge such additional amount as it determines necessary to restore it to the position in which it would have been in respect of the policy, had the data been properly advised to Sovereign by the Policy Owner in accordance with this policy. Any such additional amount so calculated may include recompense for underpaid premiums, any overpaid benefits, or other losses attributable to the misstatement or non-disclosure and will be payable by the Policy Owner upon demand in writing being made by Sovereign. 7.0 BENEFITS General 7.1 In consideration of the premiums paid under condition 6, Sovereign will provide to members the benefits set out in Schedule 1. 7.2 Sovereign will only pay one total disability benefit or partial disability benefit in respect of a member at a time. Accordingly, if a member is disabled due to more than one accident or sickness, or both, then Sovereign will pay only one total disability benefit or partial disability benefit for either an accident or sickness, even if they are related. In the event there is more than one accident or sickness in relation to a disability, Sovereign, in its sole discretion, will determine what benefit is payable. 7.3 All claims resulting from the same or related cause will be considered to be part of the same claim in respect of the benefit payment period. 7.4 If a benefit is payable in respect of a member under the policy, cover in respect of such member will be considered to continue while the benefit is payable irrespective of the member having ceased employment with the employer. UniIP 0511 Page 10

Deduction of Tax What are the Benefits? Total Disability Benefit 7.5 In the event that Sovereign is by law required to pay tax on any benefit, Sovereign will deduct such tax before any benefit is paid to any member and forward it to the relevant authority. For avoidance of doubt, Sovereign will not deduct any tax from a benefit it pays where the payment of such tax is the responsibility of the recipient of the benefit. 7.6 Sovereign will pay a total disability benefit if the member at any time while the policy is in force, becomes totally disabled and remains so for a continuous period of at least the waiting period. Such payment is subject to the terms of this policy, including any exclusions set out in condition 9. 7.7 The member will provide such medical evidence as Sovereign may reasonably require to determine whether a member has a total disability. Diagnosis must be made by a specialist acceptable to Sovereign. 7.8 The benefit is in the form of a monthly payment, which Sovereign pays monthly in arrears from the end of the waiting period until the member ceases to be entitled to a benefit in accordance with condition 7.9. 7.9 Sovereign will cease paying a total disability benefit when: a) The member returns to any work, part or full time with the employer or any other employer, or as a contractor; or b) Sovereign in its sole discretion determines that the member is no longer totally disabled; or c) The member reaches the benefit expiry date; or d) The benefit payment period expires in relation to the member; or e) The member, or any person on behalf of the member, makes a false, dishonest or fraudulent statement in respect of a claim or supports any claim with false evidence; or f) The member dies. 7.10 In addition, no total disability benefit will be payable for any period in which the member: a) Is imprisoned or otherwise detained as a result of a criminal act; or b) Does not undertake treatment and/or rehabilitation which in Sovereign s sole opinion, is likely to allow them to return to work; or c) Fails to make available to Sovereign any medical, financial or other evidence required to initially assess the claim or to assess the ongoing payment of the claim, which Sovereign has requested in writing. UniIP 0511 Page 11

Partial Disability Benefit 7.11 Sovereign will pay a partial disability benefit if the member becomes partially disabled and remains so for a continuous period of at least the waiting period. Such payment is subject to the terms of this policy including any offsets set out in conditions 10.16 to 10.18 inclusive or exclusions detailed in condition 9. 7.12 The member will provide such medical evidence as Sovereign reasonably requires for Sovereign to determine whether a member has a partial disability. Diagnosis must be made by a specialist acceptable to Sovereign. 7.13 The amount of the partial disability benefit is determined from the following formula: partial disability benefit = (D P) 1/12 th of the total disability benefit D where; D P Is the member s monthly pre disability income; and Is the actual monthly earnings of the member from personal exertion, or, in Sovereign s opinion, the monthly earnings which the member is capable of generating from personal exertion, while partially disabled. 7.14 Sovereign will cease paying a partial disability benefit when: a) The member s earnings from personal exertion exceeds 75% of predisability income; or b) Sovereign in its sole discretion, determines that the member is no longer partially disabled; or c) The member reaches the benefit expiry date; or d) The expiry of the benefit payment period in relation to the member; or e) The member, or any person on behalf of the member, makes a false, dishonest or fraudulent statement in respect of a claim or supports any claim with false evidence; or f) The member dies. 7.15 In addition, no partial disability benefit will be payable for any period in which the member: a) Is imprisoned or otherwise detained as a result of a criminal act; or b) Does not undertake treatment and/or rehabilitation which in Sovereign s sole opinion, is likely to allow them to return to any form of work; or c) Fails to make available to Sovereign any medical, financial or other evidence required to assess the claim, which Sovereign has requested in writing. UniIP 0511 Page 12

Vocational Retraining Benefit 7.16 Sovereign may agree to pay a member a vocational retraining benefit. The benefit payable will be the cost of a programme of vocational training for the member provided: a) The programme is approved in advance by Sovereign and reviewed regularly by Sovereign; and b) The sole purpose of the programme is to assist the member to return to gainful employment at an earlier date than would otherwise have been possible; and c) The member actively participates in the programme; and d) The cost of the programme is limited to the fee charged by the institution providing the programme and does not include the cost of text books, equipment, stationery, accommodation or transport costs; and e) The vocational retraining takes place within New Zealand, or the country in which the member was residing for 6 months before becoming disabled; and f) The member is receiving a total disability benefit when the programme begins. 7.17 The total amount which Sovereign will pay as a vocational retraining benefit is limited to 12 times the monthly total disability benefit. In addition, any benefit which Sovereign may agree to pay is to be reduced by any costs the member recovers or could recover from any source, including any offset detailed in conditions 10.17 and 10.18. Rehabilitation Expense Benefit 7.18 Sovereign may agree to pay a member an additional lump-sum payment of up to 6 times the monthly total disability benefit. This payment is to cover the costs of buying specialised equipment or completing home alterations that have become necessary because of the member s disability. The member must seek prior approval from Sovereign before incurring these costs. Any rehabilitation expense benefit that Sovereign may agree to pay for the specialised equipment or home alterations will be reduced by any costs the member recovers or could recover from any other source, including any offset detailed in conditions 10.17 and 10.18. Bed Confinement Benefit 7.19 If Schedule 1 provides for a bed confinement benefit, and during the waiting period the member is confined to bed under the daily supervision of a medical practitioner for more than 3 days, then Sovereign will pay a bed confinement benefit for each complete 24-hour period after the first 72 hours of bed confinement. The benefit is payable as a lump sum at the expiry of the waiting period and is equal to 1/365th of the member s annual total disability benefit for each complete day of care in excess of 3 days during the period of continuous care within the waiting period. 7.20 The maximum number of complete days of care that qualify for a bed confinement benefit shall be the lesser of: a) The waiting period less 3 days; or b) 90 days. UniIP 0511 Page 13

Bereavement Support Benefit 7.21 If Schedule 1 provides for a bereavement support benefit, then if the member dies while either a total disability benefit or partial disability benefit is being paid, that benefit will cease and a bereavement support benefit equal to a lump sum of $5,000 is payable to the Policy Owner. Waiver of Waiting Period for Recurring Disability 7.22 Provided the policy has not terminated under condition 11, the waiting period will be waived by Sovereign if a member becomes totally disabled again from the same or a related cause not later than 6 months after the original benefit ceased. Accordingly, all claims resulting from the same or a related cause will be considered to be the same claim in respect of the benefit payment period. Indexation of Monthly Benefit 7.23 Where indexation of benefit applies as stated in Schedule 1, the benefit payable per year in respect of a member will be increased, effective from each anniversary of the commencement of the payment of the benefit by the lesser of: a) the percentage movement in the CPI for the 12 months immediately preceding the relevant anniversary of the commencement of the payment of the benefit; and b) 5% per annum. Spouse Benefit 7.24 If Sovereign has agreed in writing in Schedule 1, Sovereign may offer a spouse benefit. 7.25 Automatic acceptance limits are not available to spouse members. 7.26 Acceptance of a person for a spouse benefit by Sovereign will be subject to underwriting terms as set out in conditions 3.7 to 3.9 inclusive. 7.27 A spouse member s membership will be considered terminated when the membership of his/her spouse is terminated for any reason. At such time, the ex-spouse member may apply for a continuation option subject to meeting the requirements of condition 12. 7.28 A spouse member s membership will also be considered to be terminated if his/her spouse s membership is terminated under condition 11. At such time, the ex-spouse member may apply for a continuation option subject to meeting the requirements of condition 12. The ex-spouse member may reapply for membership on terms advised by Sovereign, if his/her spouse resumes his/her membership in accordance with condition 11.7 and the ex-spouse member has not exercised his/her continuation option. 7.29 Only one spouse member will be accepted per member. 7.30 A spouse applicant must be in permanent employment, working no less than 15 hours per week, to be eligible to apply for this benefit. UniIP 0511 Page 14

8.0 OTHER COVER Cover During Unpaid Leave 8.1 A member (who is not a spouse member) who takes unpaid leave can continue to be insured for a period of up to 12 months after the date such unpaid leave commences provided the following requirements are met: a) The member is actively employed before he/she goes on unpaid leave (except where unpaid leave is due to sickness or accident leading to a disability under this policy); and b) The employer approves the period of unpaid leave in writing before the member goes on unpaid leave; and c) The member applies at least 14 days in advance of their intended leave start date to Sovereign; and d) Premiums for the member continue to be paid in full while the member is on unpaid leave. 8.2 Subject to earlier termination under condition 12, cover will cease for a member on unpaid leave on the date 12 months from the date such unpaid leave commences (unless the member is in receipt of a benefit). At such time, the person may apply for a continuation option subject to meeting the requirements of condition 13. 8.3 Where a member on unpaid leave becomes entitled to a benefit, such benefit, will be based on the member s annual salary as advised at the last policy anniversary date prior to the commencement of the unpaid leave. Worldwide Cover 8.4 Subject to conditions 8.5 to 8.7 inclusive, members will have worldwide cover. 8.5 If Sovereign agrees in writing, it will cover a permanent resident of New Zealand under this policy while he/she is employed overseas. However, no continuation option will be available for a person living outside New Zealand who remains outside New Zealand after his/her membership is terminated, regardless of whether he/she is a permanent resident or not. 8.6 If a member is not a permanent resident of New Zealand but Sovereign has agreed to insure such member, cover for the member is not available outside New Zealand at any time, unless Sovereign agrees otherwise in writing. 8.7 Unless Sovereign has otherwise agreed in writing with the Policy Owner prior to the member s departure, the benefit payment period may be reduced to 6 months in respect of a member while the member continues to live or reside outside New Zealand. In addition, Sovereign at its sole discretion may adjust any benefit payable if the taxation applicable in the country where the member resides would result (in Sovereign s opinion) in an overpayment of the benefit. UniIP 0511 Page 15

9.0 EXCLUSIONS Member Exclusions 10.0 CLAIMS When a Benefit Is Payable 9.1 Sovereign will not pay a benefit where the disability (in the opinion of Sovereign) was directly or indirectly caused by, resulting from, in connection with war (whether declared or undeclared), invasion, act of foreign enemy, hostilities or warlike operations, civil war, military rising, insurrection, rebellion, revolution, military or usurped power, or participation in any armed forces or peace keeping activities. 9.2 A benefit shall not be payable where any of the following (and in each case either directly or indirectly) causes or contributes to the total disability: a) The member deliberately taking or using non-prescribed drugs, other than for proper therapeutic or medical purposes and in accordance with the manufacturer s directions for use or the deliberate misuse by the member of prescribed drugs; or b) The member deliberately injuring himself or herself, or attempting to do so, whether the member is sane or insane; or c) The member participating in any criminal act. 9.3 Sovereign will not pay a benefit where the member does not comply with treatment prescribed by the attending treatment providers. 10.1 Subject to the terms of this policy, Sovereign will pay a benefit in the event of a member s: a) Total disability; or b) Partial disability. 10.2 Sovereign will not pay immediately upon the member suffering a disability. The member must wait for the waiting period to expire. The waiting period commences from the date of disablement. No benefit is payable if the member ceases to be totally disabled during the waiting period and is not partially disabled, or entitled to a bed confinement benefit. Claim Criteria 10.3 The member and/or the employer must notify the Policy Owner of any event giving rise to a claim for the payment of a benefit within 30 days or as soon as is reasonably possible after the disability commences. 10.4 The Policy Owner and/or the member must notify Sovereign of any event giving rise to a claim for the payment of a benefit within 30 days or as soon as is reasonably possible after the disability commences. 10.5 The Policy Owner will provide such evidence of entitlement to the benefit as Sovereign may reasonably require to properly assess the claim. Such information may include: UniIP 0511 Page 16

a) The circumstances of the claim; b) The medical history of the member; c) The medical condition of the member; d) The member s financial affairs; e) For accident related claims, a declaration that a claim has been lodged with the Accident Compensation Corporation and the details and outcome of that claim; f) Details of any work being completed, whether remunerated or not; g) Any other relevant matter such as job responsibilities, work history, qualifications. 10.6 Where a claim is made in relation to a member who is overseas (whether residing or travelling), Sovereign may, at its discretion, require such member to either: a) Return to New Zealand for assessment (medical or otherwise). Any costs relating to the member s return to New Zealand will be borne by the member; or b) Provide a medical assessment (or other such relevant information) to be carried out by an elected representative approved by Sovereign in the country where the member is situated. 10.7 Sovereign has the right to have the member provide medical evidence at Sovereign's expense when and as Sovereign may reasonably require after the member has submitted a claim under this policy. 10.8 The Policy Owner will also provide such other evidence of entitlement to the benefit as Sovereign may reasonably require to properly assess the claim. Such information may include, but is not limited to the medical history of the member and any other relevant matter. 10.9 Sovereign is under no obligation to consider a claim unless all of the information requested is provided. Furthermore, Sovereign is under no obligation to assess or pay a claim prior to receiving notification. 10.10 Sovereign may also ask the member to undergo further medical examinations (where applicable) throughout the life of any claim. Any requests made by Sovereign will be at Sovereign s expense. 10.11 If a claim is submitted by a person who became a member during a policy year, and prior to the policy owner providing Sovereign with the information required in accordance with condition 3.10, Sovereign will not be liable to pay any benefit claimed until it is satisfied that the member has continued to meet the eligibility criteria required to remain in the scheme. 10.12 For any benefit payable whose value is based on a member s salary, the amount payable will be that value which was accepted upon application, or at the last annual anniversary as per condition 3.10, whichever is later, unless an alternative salary has been advised and agreed to in writing during the policy year. 10.13 Sovereign will not be liable to pay a benefit in respect of a member if Sovereign becomes aware that the member did not meet the eligibility criteria and the requirements in condition 3 prior to becoming a member, and any UniIP 0511 Page 17

benefit paid in respect of such shall be reimbursed to Sovereign by the member or payment recipient upon demand. Payment of Benefit Reduction of Benefit 10.14 A benefit payable under this policy will be paid by Sovereign to the Policy Owner. The receipt of the benefit by the Policy Owner, or such recipient as they direct in writing, will be an absolute discharge to Sovereign. 10.15 The maximum amount payable in respect of any claim arising from the insurance under this policy in respect of any one member shall not exceed the lesser of the benefit or the maximum benefit. 10.16 The total disability benefit or partial disability benefit will be reduced by the amount of any other regular payments received by the member or payments that the member is entitled to receive in Sovereign s opinion in respect of the accident or sickness giving rise to the disability: a) Under any entitlements under the Holidays Act 2003 or any other statutory enactment relating to leave provisions of the employer b) Under any additional sick leave or annual leave entitlements of the employer in excess of the statutory requirements; or c) Under any superannuation or retirement scheme in which the member participates; or d) Entitlements under the Injury Prevention, Rehabilitation, and Compensation Act 2001 or any other statutory enactment relating to compensation for accident or sickness; or e) Under any other insurance cover against disability, accident or sickness whether underwritten by Sovereign or any other insurance company; or f) Under common law as compensation for loss of future income or loss of earning capacity; or g) Any income the member receives or is entitled to receive from the employer or the member s business partnership, family trust or company subsequent to the date of disablement, other than unearned income such as investment or rental income; or h) If the member receives or is entitled to receive income from Work and Income New Zealand ( WINZ ), the member is obliged to inform WINZ of any payments from Sovereign. 10.17 Where a lump sum form of compensation is received by a member from any source in lieu of regular payments of compensation, any benefit payable will be equal to the difference between the monthly equivalent of the weekly rate payable by the Accident Compensation Corporation (whether or not a member is entitled to compensation) at the date of the lump-sum compensation and the benefit due. Such offset will be made against subsequent benefit payments until the total offset equals the amount of the lump-sum compensation received. For avoidance of doubt, lump-sum benefits received by the member from any superannuation or retirement scheme will not reduce the benefits payable under this policy. If the trustees of the superannuation or retirement scheme choose to pay benefits as a regular income, these benefits will be treated as unearned income and will not be offset from the benefit payable under this policy. UniIP 0511 Page 18

10.18 If the member receives any offset amount or becomes entitled to receive any offset amount as set out in conditions 10.16 and 10.17, the member must provide Sovereign with the full details of such offset amount in writing as soon as practicable. Sovereign may then reduce the benefit payable or recover any overpayment of benefit from the Policy Owner or the member, where the benefit was paid directly to the member at the request of the Policy Owner. Non-Payment of Benefit 10.19 If a claim is made by a person who became a member during a policy year, and prior to the Policy Owner providing Sovereign with a certificate in accordance with condition 3.10, Sovereign will not be liable to pay any benefit claimed until it is satisfied that the person met the eligibility criteria at the time he/she became a member. 10.20 To the extent permitted by law, if the Policy Owner knowingly delays notifying Sovereign of a claim and, as a result, Sovereign s interests are prejudiced, Sovereign may not pay the claim or may reduce the benefit. 10.21 The Policy Owner acknowledges that Sovereign relies on correct information being provided to it to assess whether to pay a benefit. Accordingly, if information provided is not correct or if a member or the Policy Owner has not complied with their duty of disclosure, Sovereign may be legally entitled not to pay a benefit in accordance with condition 13.2. Regular Assessments 10.22 For ongoing claims Sovereign will require proof on a regular basis of: a) The member s continuing disability; and b) Any monthly earnings the member receives during the benefit payment period; and c) Any work the member completes whether remunerated or nonremunerated; and d) Any income received from other sources. 10.23 The member s medical practitioner will be required to complete a monthly claim report (at the member s expense). Sovereign will normally send this claim report with the payment letter for the previous month s benefit. 10.24 Sovereign may also request that the member: a) Undergo any medical and/or surgical treatment (including any operation or vocational, medical and/or social rehabilitation programme) at the member s expense which the member s medical practitioner or a registered medical practitioner approved by Sovereign consider necessary; and b) Undergo any medical examination Sovereign requires at Sovereign s expense. 10.25 If the member fails to comply with conditions 10.22 10.24 inclusive within a reasonable timeframe as requested by Sovereign, the member shall cease to be considered disabled from the date of that failure. UniIP 0511 Page 19

11.0 TERMINATION Termination of this Policy 11.1 This policy may be terminated by the Policy Owner by giving at least 90 days notice in writing to Sovereign, or such lesser period as Sovereign may agree. All premiums due under this policy must be paid up to and including the date of termination. 11.2 After the guarantee date, Sovereign may terminate this policy for any reason from a policy anniversary date by giving at least 90 days prior notice in writing to the Policy Owner and member. 11.3 No benefits will be payable under the policy on or after the date of termination except in respect of a member who is totally disabled or partially disabled if that members date of disablement for such disability occurred prior to the date of termination. 11.4 If this policy is terminated and a refund of premium is due then Sovereign will refund to the Policy Owner the appropriate amount. The amount refunded may be reduced by any reasonable expenses incurred by Sovereign in terminating this policy. 11.5 If this policy is terminated by either the Policy Owner or Sovereign, then current and eligible members are entitled to apply for a continuation option under condition 12, unless the policy is terminated by any party for the purpose of transferring the policy, and the members, to an alternative provider other than Sovereign. Termination of Membership 11.6 A member s membership will be considered to be terminated if, though genuinely retained in the service of the employer, he/she has ceased to be actively employed in any one or more of his/her employment duties because of: a) Sickness or accident for a period exceeding 24 consecutive months; or b) Any other cause for a period exceeding 12 consecutive months. 11.7 A member whose membership is considered to be terminated under condition 11.6 may, if he/she resumes active employment with the employer, resume membership on the terms advised by Sovereign at the time of the member s resumption. 11.8 A member s benefit under this policy will terminate immediately on the earliest occurrence of the following: a) The payment of premiums or any part of them is discontinued in respect of the member within 30 days of the premium due date, notwithstanding a genuine error by the employer, Policy Owner or Sovereign as assessed by Sovereign; or b) The member ceasing to be employed by the employer (where such member is not in receipt of a benefit or in a waiting period when this occurs); or c) Where the member is no longer in receipt of a benefit and has ceased to be employed by the employer; or UniIP 0511 Page 20

d) The member no longer meeting the eligibility criteria as at the next plan anniversary date or earlier if requested by the member; or e) The member reaching the benefit expiry date; or f) The date this policy is terminated in accordance with condition 11. When Can Sovereign Cancel Your Membership? 11.9 If the member has: a) Failed to disclose all material information to us prior to inception, variation or re-instatement of the membership; or b) Made a statement on the faith of which the membership was accepted, renewed, varied or reinstated, that was, in terms of the Insurance Law Reform Act 1977: material, and substantially incorrect, Sovereign may, at its complete discretion, either: Avoid from inception your membership (this means the cover is deemed never to have existed); or Avoid from inception any individual benefits provided by your membership (this means the individual benefit(s) are deemed never to have existed); or Alter the terms upon which cover is provided under your membership. If we choose to alter the terms of your membership we may do so effective from the risk commencement date; or Remove from inception any life assured from this policy (and for the avoidance of doubt this policy will remain in force for the remaining lives assured if applicable). 11.10 If the membership or any benefit provided by the membership is avoided from inception, or any life assured is removed from this policy, you will forfeit and we will be entitled to retain all premiums paid in relation to the benefit, membership or life assured. 11.11 Sovereign can cancel the membership and decline liability in respect of any claim made under the policy if you, a life assured or anyone acting on your behalf, makes a claim under the membership that is false or fraudulent in any respect. In the event that a false or fraudulent claim is established after payment of the claim all amounts paid in relation to the false or fraudulent claim must be repaid. 12.0 CONTINUATION OPTION 12.1 On the termination of a member s membership while this policy is current and prior to the attainment of the earlier of the member s 65 th birthday or the benefit expiry date then, within 45 days of the date of termination: a) The member may request Sovereign to issue him/her an individual policy for the same or substantially similar cover for an amount not exceeding the member s benefit under this policy as at the date membership terminated; and b) Sovereign will issue an individual policy without further evidence of health at the rate of premium then in use by Sovereign for such policy having regard to any conditions of membership under this policy, the age, gender and smoking status of the member, the new occupation of the member, the type of insurance selected and any particular hazard attributable to circumstances other than health, UniIP 0511 Page 21