<PAGE>
File No. 33-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-6
FOR REGISTRATION UNDER THE SECURITIES ACT OF 1933 OF
SECURITIES OF UNIT INVESTMENT TRUSTS REGISTERED ON
FORM N-8B-2
A. Exact name of trust: Separate Account VL I
B. Name of depositor: ITT Hartford Life and Annuity Insurance Company
C. Complete address of depositor's principal executive offices:
P.O. Box 2999
Hartford, CT 06104-2999
D. Name and complete address of agent for service:
Scott K. Richardson, Esq.
ITT Hartford Life Insurance Companies
P.O. Box 2999
Hartford, CT 06104-2999
It is proposed that this filing will become effective:
_____ immediately upon filing pursuant to paragraph (b) of Rule 485
_____ on May 1, 1996 pursuant to paragraph (b) of Rule 485
_____ 60 days after filing pursuant to paragraph (a)(1) of Rule 485
_____ on May 1, 1996 pursuant to paragraph (a)(1) of Rule 485
_____ this post-effective amendment designates a new effective date for a
previously filed post-effective amendment.
E. Title and amount of securities being registered:
Pursuant to Rule 24f-2 under the Investment Company Act of 1940, the
Registrant has registered an indefinite amount of securities. Registrant
will file the Rule 24f-2 Notice upon completion of its first complete
fiscal year.
F. Proposed maximum aggregate offering price to the public of the securities
being registered:
Not yet determined.
G. Amount of filing fee: Paid
H. Approximate date of proposed public offering:
As soon as practicable after the effective date of this registration
statement.
The registrant hereby represents that it is relying on Section (13)(i)(B) of
Rule 6e-3(T).
The Registrant hereby amends this Registration Statement on such date as may
be necessary to delay its effective date until the Registrant shall file a
further amendment which specifically states that this Registration Statement
shall become effective in accordance with Section 8(a) of the Securities Act
of 1933 or until the Registration Statement shall become effective on such
date as the Commission, acting pursuant to said Section 8(a), may determine.
<PAGE>
RECONCILIATION AND TIE BETWEEN
FORM N-8B-2 AND PROSPECTUS
Item No. of
Form N-8B-2 CAPTION IN PROSPECTUS
- --------------- -----------------------------
1. Cover page
2. Cover page
3. Not applicable
4. The Company; Distribution of the Policies
5. Summary - Separate Account VL I; Separate
Account VL I - General
6. Separate Account VL I - General
7. Not required by Form S-6
8. Not required by Form S-6
9. Legal Proceedings
10. Summary; Separate Account VL I - Funds; The
Policy - Application for a Policy; Detailed
Description of Policy Benefits and Provisions; Other
Matters - Voting Rights, Dividends
11. Summary; Separate Account VL I - Funds
12. Summary; Separate Account VL I - Funds
13. Deductions and Charges from the Account Value;
Distribution of the Policies; Federal Tax
Considerations
14. Detailed Description of Policy Benefits and
Provisions - Application for a Policy
<PAGE>
Item No. of
Form N-8B-2 CAPTION IN PROSPECTUS
- --------------- -----------------------------
15. Detailed Description of Policy Benefits and
Provisions - Allocation of Premium Payments
16. Separate Account VL I - Funds; Detailed
Description of Policy Benefits and
Provisions - Allocation of Premium Payments
17. Summary; Detailed Description of Policy Benefits
and Provisions - Cash Value and Amount Payable on
Surrender of the Policy, The Right to Examine or
Exchange the Policy and Surrender/Continuation Options.
18. Separate Account VL I - Funds; Deduction and
Charges from the Account Value; Federal Tax Considerations
19. Other Matters - Statements to Policy Owners
20. Not applicable
21. Detailed Description of Policy Benefits and
Provisions - Policy Loans
22. Not applicable
23. Safekeeping of the Separate Account Assets
24. Other Matters - Assignment
25. The Company
26. Not applicable
27. The Company
28. The Company; Management
29. The Company
30. Not applicable
<PAGE>
Item No. of
Form N-8B-2 CAPTION IN PROSPECTUS
- --------------- --------------------------
31. Not applicable
32. Not applicable
33. Not applicable
34. Not applicable
35. Distribution of the Policies
36. Not required by Form S-6
37. Not applicable
38. Distribution of the Policies
39. The Company; Distribution of the Policies
40. Not applicable
41. The Company; Distribution of the Policies
42. Not applicable
43. Not applicable
44. Detailed Description of Policy Benefits and
Provisions - Allocation of Premium Payments
45. Not applicable
46. Detailed Description of Policy Benefits and
Provision - Cash Value
47. Separate Account VL I - Funds
48. Cover page; The Company
49. Not applicable
<PAGE>
Item No. of
Form N-8B-2 CAPTION IN PROSPECTUS
- --------------- -------------------------
50. Separate Account VL I - General
51. Summary; The Company; Detailed Description of
Policy Benefits and Provisions; Other Matters - Beneficiary
52. Separate Account VL I - Funds, Investment Advisers
53. Federal Tax Considerations
54. Not applicable
55. Not applicable
56. Not required by Form S-6
57. Not required by Form S-6
58. Not required by Form S-6
59. Not required by Form S-6
<PAGE>
ITT HARTFORD LIFE AND ANNUITY
INSURANCE COMPANY
P.O. Box 2999
Hartford, CT 06104-2999
Telephone (800) 231-5453
[PRODUCT NAME]
Flexible Premium
Variable Life Insurance Policy
[LOGO]
This Prospectus describes a flexible premium variable life insurance policy
(the "Policy") offered by ITT Hartford Life and Annuity Insurance Company
("ITT Hartford") to applicants generally between ages 0 and 80. The Policy
allows considerable flexibility in selecting the timing and amount of premium
payments for the chosen amount of Death Benefit.
The Policy provides for a Death Benefit payable at the death of the Insured.
The Policy Owner may select one of three Death Benefit Options; a level amount
equal to the Face Amount ("Option A"), a variable amount equal to the Face
Amount plus the Account Value ("Option B"), or an increasing amount equal to
the Face Amount plus a return of premium ("Option C"). The required minimum
initial Face Amount is generally $25,000.
Under all three options, the Policy has Account Values which increase with
the payment of each premium and which decrease to reflect fees and charges
made by ITT Hartford. These fees and charges vary depending on such factors as
the Face Amount, the age of the Insured and the level of the premium paid. The
Account Value of a Policy will fluctuate to reflect the investment experience
of the Funds to which the premium payment(s) has been allocated. The Policy
Owner bears the investment risk for all amounts so allocated.
If a Policy is surrendered during the first two Policy Years, the Cash
Surrender Value may be adjusted upward to reflect a reduced Surrender Charge.
There is no guaranteed minimum Account Value for a Policy. However, if the
Death Benefit guarantee is in effect (see "Death Benefit" on page 13), the
Policy will not lapse due to poor investment performance.
The initial premium will be allocated to Hartford Money Market Sub-Account
and after the Right to Examine Period has expired, to one or more of the
Sub-Accounts or to the Fixed Account as specified in the Policy Owner's
application. The Funds underlying the Sub-Accounts presently are: Hartford
Advisers Fund, Inc., Hartford Bond Fund, Inc., Hartford Capital Appreciation
Fund, Inc., Hartford Dividend and Growth Fund, Inc., Hartford Index Fund,
Inc., Hartford International Opportunities Fund, Inc., Hartford Mortgage
Securities Fund, Inc., Hartford Stock Fund, Inc., and HVA Money Market Fund,
Inc. managed by Hartford Investment Management Company (the "Hartford Funds");
PCM Diversified Income Fund, PCM Global Growth Fund, PCM Growth and Income
Fund, PCM High Yield Fund, PCM Money Market Fund, PCM New Opportunities Fund,
PCM Global Asset Allocation Fund, PCM U.S. Government and High Quality Bond
Fund, PCM Utilities Growth and Income Fund, and PCM Voyager Fund managed by
Putnam Investment Management, Inc. (the "Putnam Funds"); and the Equity-Income
Portfolio, Overseas Portfolio and Asset Manager Portfolio (the "Fidelity
Funds") managed by Fidelity Management & Research Company.
------------------------------------------------------------------------------
IT MAY NOT BE ADVANTAGEOUS TO PURCHASE FLEXIBLE PREMIUM VARIABLE LIFE
INSURANCE AS A REPLACEMENT FOR YOUR CURRENT LIFE INSURANCE OR IF YOU ALREADY
OWN A FLEXIBLE PREMIUM VARIABLE LIFE INSURANCE POLICY.
------------------------------------------------------------------------------
THIS PROSPECTUS IS VALID ONLY IF ACCOMPANIED BY THE CURRENT PROSPECTUSES OF
THE APPLICABLE ELIGIBLE FUNDS WHICH CONTAIN A FULL DESCRIPTION OF THOSE FUNDS.
ALL PROSPECTUSES SHOULD BE READ AND RETAINED FOR FUTURE REFERENCE.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.
------------------------------------------------------------------------------
The date of this Prospectus is Xxxxxx XX, 1996
------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C>
SPECIAL TERMS........................................................... 4
SUMMARY................................................................. 5
DETAILED DESCRIPTION OF POLICY BENEFITS AND PROVISIONS.................. 9
General............................................................... 9
Premium............................................................... 9
Premium Payment Flexibility......................................... 9
Allocation of Premium Payments...................................... 9
Accumulation Units.................................................. 10
Accumulation Unit Values............................................ 10
Premium Limitation.................................................. 10
Account Values........................................................ 10
Amount Payable on Surrender of the Policy........................... 11
Sales Load Refund................................................... 11
Withdrawals......................................................... 11
Transfers of Account Value............................................ 11
Amount and Frequency of Transfers................................... 11
Transfers to or from Sub-Accounts................................... 12
Transfers from the Fixed Account.................................... 12
Policy Loans.......................................................... 12
Preferred Loan...................................................... 12
Loan Interest....................................................... 13
Credited Interest................................................... 13
Loan Repayments..................................................... 13
Termination Due to Excessive Indebtedness........................... 13
Effect of Loans on Account Value.................................... 13
Death Benefit......................................................... 13
Death Benefit Options............................................... 13
Option Change....................................................... 14
Death Benefit Guarantee............................................. 14
Minimum Death Benefit............................................... 14
Increases and Decreases in Face Amount.............................. 15
Benefits at Maturity.................................................. 15
Lapse and Reinstatement............................................... 15
Policy Lapse and Grace Period....................................... 15
Death Benefit Guarantee Default and Grace Period.................... 15
Reinstatement....................................................... 16
The Right to Examine or Exchange the Policy........................... 16
Withdrawal............................................................ 16
Administrative Expense Surrender Charge............................. 17
Sales Surrender Charge.............................................. 17
Valuation of Payments and Transfers................................... 17
Application for a Policy.............................................. 18
Reduced Charges for Eligible Groups................................... 18
Deductions from the Premium........................................... 18
Premium Tax Charge and Federal Tax Charge........................... 18
Front End Sales Load................................................ 18
Examples of Front End Sales Loads/Impact of Refund of Sales Load.... 19
Deductions and Charges from the Account Value......................... 20
Monthly Deduction Amounts........................................... 20
Charges Against the Funds........................................... 21
Taxes............................................................... 22
THE COMPANY............................................................. 22
SEPARATE ACCOUNT VL I................................................... 23
General............................................................... 23
</TABLE>
2
<PAGE>
<TABLE>
<CAPTION>
PAGE
<S> <C>
Funds................................................................. 23
Hartford Funds...................................................... 23
Putnam Funds........................................................ 24
Fidelity Funds...................................................... 25
Investment Adviser.................................................... 26
Hartford Funds...................................................... 26
Putnam Funds........................................................ 27
Fidelity Funds...................................................... 27
THE FIXED ACCOUNT....................................................... 27
OTHER MATTERS........................................................... 28
Voting Rights......................................................... 28
Statements to Policy Owners........................................... 28
Limit on Right to Contest............................................. 28
Misstatement as to Age................................................ 28
Payment Options....................................................... 29
Beneficiary........................................................... 29
Assignment............................................................ 29
Dividends............................................................. 29
SUPPLEMENTAL BENEFITS................................................... 30
Maturity Date Extension Rider......................................... 30
Term Insurance Rider.................................................. 30
Deduction Amount Waiver Rider......................................... 30
Waiver of Specified Amount Disability Benefit Rider................... 30
Accidental Death Benefit Rider........................................ 30
EXECUTIVE OFFICERS AND DIRECTORS........................................ 31
DISTRIBUTION OF THE POLICY.............................................. 33
SAFEKEEPING OF SEPARATE ACCOUNT VL I'S ASSETS........................... 33
FEDERAL TAX CONSIDERATIONS.............................................. 33
General............................................................... 33
Taxation of ITT Hartford and the Separate Account..................... 33
Income Taxation of Contract Benefits.................................. 34
Modified Endowment Contracts.......................................... 34
Estate and Generation Skipping Taxes.................................. 34
Diversification Requirements.......................................... 35
Ownership of Assets in the Separate Account........................... 35
Life Insurance Purchased for Use in Split Dollar Arrangements......... 36
Federal Income Tax Withholding........................................ 36
Non-Individual Ownership of Contracts................................. 36
Life Insurance Purchases by Nonresident Aliens and Foreign
Corporations......................................................... 36
Other Tax Considerations.............................................. 36
LEGAL PROCEEDINGS....................................................... 36
LEGAL MATTERS........................................................... 36
EXPERTS................................................................. 37
REGISTRATION STATEMENT.................................................. 37
APPENDIX A -- ILLUSTRATION OF DEATH BENEFITS, ACCOUNT VALUES AND CASH
SURRENDER VALUES..................................................... 38
FINANCIAL STATEMENTS.................................................... 48
</TABLE>
THE POLICY MAY NOT BE AVAILABLE IN ALL STATES.
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFERING IN ANY JURISDICTION IN WHICH
SUCH OFFERING MAY NOT BE LAWFULLY MADE. NO DEALER OR OTHER PERSON IS AUTHORIZED
TO GIVE ANY INFORMATION OR MAKE ANY REPRESENTATIONS IN CONNECTION WITH THIS
OFFERING OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS AND, IF GIVEN OR MADE,
SUCH OTHER INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED ON.
3
<PAGE>
SPECIAL TERMS
As used in this Prospectus, the following terms have the indicated meanings:
ACCOUNT VALUE: An amount used to determine certain Policy benefits and charges
equal to the total of all amounts in the Fixed Account, the Loan Account and the
Sub-Accounts.
ACCUMULATION UNIT: An accounting unit of measure used to calculate the value of
a Sub-Account.
CASH SURRENDER VALUE: The Cash Value less all Indebtedness.
CASH VALUE: The Account Value less any applicable Surrender Charges.
CODE: The Internal Revenue Code of 1986, as amended.
COST OF INSURANCE: An amount deducted as part of the Monthly Deduction Amount to
help cover ITT Hartford's anticipated mortality costs and other expenses.
CUMULATIVE DEATH BENEFIT GUARANTEE PREMIUM: The premium required to maintain the
Death Benefit guarantee.
DATE OF ISSUE: The date from which the Suicide and Incontestability provisions
are measured.
DEATH BENEFIT: On the Policy Date, the Death Benefit equals the Face Amount.
Thereafter, it may change in accordance with the terms of the Death Benefit
Option provision, the Minimum Death Benefit provision, the Death Benefit
Guarantee provision and the Withdrawals provision.
DEATH BENEFIT GUARANTEE PREMIUM: The amount of monthly premium shown in the
Policy's specifications page required to keep the Death Benefit guarantee
available and used to calculate the Cumulative Death Benefit Guarantee Premium.
DEATH BENEFIT OPTION: The Death Benefit Option in effect determines how the
Death Benefit is calculated. The three Death Benefit Options provided are
described in the Death Benefit section of this Prospectus.
DEATH PROCEEDS: The amount which We will pay on the death of the Insured. This
amount equals the Death Benefit less any Indebtedness and less any due and
unpaid Monthly Deduction Amount occurring during a Grace Period.
FACE AMOUNT: On the Policy Date, the Face Amount equals the initial Face Amount.
The Face Amount may be increased or decreased, in accordance with the terms of
the Policy.
FIXED ACCOUNT: Portion of Account Value invested in the General Account of ITT
Hartford.
FIXED ACCOUNT MINIMUM CREDITED RATE: The minimum rate credited to amounts
allocated to the Fixed Account.
FUNDS: The registered open-end management investment companies in which assets
of the Separate Account may be invested.
GENERAL ACCOUNT: All assets of ITT Hartford other than those allocated to its
separate accounts.
GRACE PERIOD: The 61 day period between the day Your policy goes into default
and the day on which Your policy terminates.
IN WRITING: In a written form satisfactory to Us.
INDEBTEDNESS: All loans taken on the Policy, plus any interest due or accrued
minus any loan repayments.
INSURED: The person on whose life the Policy is issued.
ISSUE AGE: As of the Policy Date, the age of the Insured's on his/her last
birthday.
ITT HARTFORD: ITT Hartford Life and Annuity Insurance Company.
LOAN ACCOUNT: An account established for any amounts transferred from the Fixed
Account and Sub-Accounts as a result of loans. Amounts are held as collateral
and are credited with interest at the Fixed Account Minimum Credited Rate.
Amounts are not subject to the investment experience of the Separate Account.
MONTHLY ACTIVITY DATE: The Policy Date and the same date in each succeeding
month as the Policy Date except that, whenever the Monthly Activity Date falls
on a date other than a Valuation Day, the Monthly Activity Date will be deemed
the next Valuation Day.
MONTHLY DEDUCTION AMOUNT: The charges deducted from the Account Value on the
Monthly Activity Date.
NATIONAL SERVICE CENTER: Located in Minneapolis, Minnesota.
4
<PAGE>
NET PREMIUM: The amount of premium credited to the Account Value. It is the
premium paid minus any deductions from premium.
OPTION C LIMIT: The maximum amount that will be returned in addition to the Face
Amount under the Option C (Return of Premium) Death Benefit. See the Policy's
specifications page.
PLANNED PREMIUM: The amount of premium that You intend to pay as indicated on
the application and shown on the Policy's specifications page.
POLICY: A flexible premium variable life insurance policy issued by ITT
Hartford, as described in this Prospectus.
POLICY ANNIVERSARY: An anniversary of the Policy Date.
POLICY DATE: The date from which Policy Anniversaries and Policy Years are
determined.
POLICY OWNER: The person having rights to benefits under the Policy during the
lifetime of the Insured; the Policy Owner may or may not be the Insured.
POLICY YEARS: Annual periods computed from the Policy Date.
PREFERRED LOAN: A portion of the Indebtedness on which a lower interest rate is
charged.
PRO RATA BASIS: An allocation method based on the proportion of the Account
Value in the Fixed Account and each Sub-Account.
SCHEDULED MATURITY DATE: The date on which the Policy will mature, unless
extended by rider.
SEPARATE ACCOUNT: An account established by ITT Hartford to separate the assets
funding the Policy from other assets of ITT Hartford; in this case, "Separate
Account VL I."
SUB-ACCOUNT: The subdivisions of the Separate Account.
SURRENDER CHARGE: A charge that may be assessed if the Face Amount is decreased
or You surrender the Policy.
VALUATION DAY: Every day the New York Stock Exchange is open for trading. The
value of the Separate Account is determined at the close of the New York Stock
Exchange (currently 4:00 p.m. Eastern Time) on such days.
VALUATION PERIOD: The period between the close of business on successive
Valuation Days.
YOU, YOUR: The Owner of the Policy.
WE, US, OUR: ITT Hartford Life and Annuity Insurance Company.
5
<PAGE>
SUMMARY
THE POLICY
The flexible premium variable life insurance Policy offered by this
Prospectus are funded by a Fixed Account and Separate Account VL I, a separate
account established by ITT Hartford pursuant to Connecticut insurance law and
organized as a unit investment trust registered under the Investment Company Act
of 1940. Separate Account VL I is presently comprised of twenty-two sub-accounts
(the "Sub-Accounts" and each individually a "Sub-Account"), each of which
invests exclusively in one of the underlying Funds. If an initial premium is
submitted with an application for a Policy, it will be allocated to the Hartford
Money Market Sub-Account. At a later date, the values in the Hartford Money
Market Sub-Account will be allocated to one or more of the Sub-Accounts or the
Fixed Account as specified in the Policy Owner's application. This later date is
the latest of: (1) 45 days after the application is signed; (2) 10 days after We
mail or personally deliver a Notice of Withdrawal Right; (3) 10 days after We
receive the premium; and (4) the date We receive the final requirement to put
the Policy in force. The Policy is credited with units ("Accumulation Units") in
each selected Sub-Account, the assets of which are invested in the applicable
Fund. A Policy Owner may transfer the funds among the Sub-Accounts and the Fixed
Account subject to a transfer charge. See "Transfers of Account Value" of
Detailed Description of Policy Benefits and Provisions, page 11.
The Policy is first and foremost a life insurance policy with death
benefits, cash values, and other features traditionally associated with life
insurance. The Policy is called "flexible premium" because, once the desired
level and pattern of death benefits have been determined, you have considerable
flexibility in choosing the timing and amount of premium to be paid. The Policy
is called "variable" because, unlike the fixed benefits of an ordinary whole
life insurance policy, the Account Value will, and the Death Benefit may,
increase or decrease depending on the investment experience of the Funds to
which the premium payment(s) has been allocated.
POLICY DESIGN OPTIONS
The Policy is designed to be flexible to give You the ability to select
options that are tailor-made for Your specific life insurance needs.
The Policy design options fall into three major categories:
1. Death Benefit Options -- These allow You to select various levels and
patterns of Death Benefits.
2. Investment Options -- Currently, the Policy offers twenty-two investment
options from which to choose. You can allocate Your Account Value among
up to nine of these options. (ITT Hartford reserves the right to increase
the number of allocable investment options to more than nine.) These
include the twenty-two variable Sub-Accounts and the Fixed Account.
3. Premium Options -- You have the flexibility to choose, within limits,
the amount of and frequency of premium payments.
DEATH BENEFIT
The Policy features three Death Benefit Options. The Death Benefit can be
level and equal to the Face Amount ("Option A"), fluctuate and equal the Face
Amount plus Return of Account Value ("Option B") or increase and equal the Face
Amount plus the sum of premium paid, subject to the Option C Limit ("Option C").
At the death of the Insured, We will pay the Death Proceeds to the Beneficiary.
The Death Proceeds equal the Death Benefit less any Indebtedness under the
Policy and less any due and unpaid Monthly Deduction Amount occurring during a
Grace Period. See "Detailed Description of Policy Benefits and Provision --
Death Benefit," page 13.
PREMIUM
You have considerable flexibility as to when and in what amounts You pay
premium. Prior to issue, You choose a Planned Premium, within a range determined
by ITT Hartford based on the Face Amount and sex of the Insured (except where
unisex rates apply), Issue Age and risk classification.
The Policy will not lapse as long as the Cash Surrender Value is sufficient
to cover the Monthly Deduction Amounts or the Death Benefit guarantee is
available. See "Lapse and Reinstatement", page 15.
6
<PAGE>
The minimum premium is $50. We reserve the right to refund the excess
premium that would cause the Policy to fail to meet the definition of life
insurance under the Internal Revenue Code of 1986, as amended. We reserve the
right to require evidence of insurability for any premium that results in an
increase in the Death Benefit greater than the amount of the premium. Any
premium in excess of $1,000,000 is subject to ITT Hartford's approval.
There are circumstances, usually if a Policy Owner wants to prefund future
benefits in seven years or less, when the Policy may become a Modified Endowment
Contract under federal tax law. If it does, loans and other pre-death
distributions are includable in gross income on an income-first basis. A 10%
penalty tax may be imposed on income distributed before the Policy Owner attains
age 59 1/2. You are advised to consult a qualified tax adviser before taking
steps that may affect whether the Policy becomes a Modified Endowment Contract.
See "Federal Tax Considerations, Modified Endowment Contracts" for a discussion
of the "seven pay test", page 34.
SEPARATE ACCOUNT VL I
Separate Account VL I is a separate account established by ITT Hartford
pursuant to the insurance laws of the State of Connecticut and organized as a
registered unit investment trust under the Investment Company Act of 1940.
Separate Account VL I meets the definition of "separate account" under federal
securities law. Separate Account VL I is comprised of Sub-Accounts, each of
which invests exclusively in one of the Funds. Each Hartford Fund is organized
as a corporation under the laws of the State of Maryland and is a diversified
open-end management investment company registered under the Investment Company
Act of 1940. The Putnam Funds are organized as Putnam Capital Manager Trust, a
Massachusetts business trust organized on September 24, 1987, and is an
open-end, series investment company with multiple portfolios or funds registered
under the Investment Company Act of 1940. The Fidelity Funds involve two
diversified open-end management investment companies, each with multiple
portfolios and organized as a Massachusetts business trust. The Equity-Income
Portfolio and Overseas Portfolio are portfolios of the Variable Insurance
Products Fund, organized on November 13, 1981. The Asset Manager Portfolio is a
portfolio of the Variable Insurance Products Fund II, organized on March 21,
1988. Registration under the Investment Company Act of 1940 does not involve
supervision of the management or investment practices or policies by the
Commission. The shares of the Funds are sold to Separate Account VL I and to
other separate accounts of ITT Hartford or its affiliates which fund similar
annuity or life insurance products.
Currently, the Funds are Hartford Advisers Fund, Inc., Hartford Bond Fund,
Inc., Hartford Capital Appreciation Fund, Inc., Hartford Dividend and Growth
Fund, Inc., Hartford Index Fund, Inc., Hartford International Opportunities
Fund, Inc., Hartford Mortgage Securities Fund, Inc., Hartford Stock Fund, Inc.,
and HVA Money Market Fund, Inc.; PCM Diversified Income Fund, PCM Global Growth
Fund, PCM Growth and Income Fund, PCM High Yield Fund, PCM Money Market Fund,
PCM New Opportunities Fund, PCM Global Asset Allocation Fund, PCM U.S.
Government and High Quality Bond Fund, PCM Utilities Growth and Income Fund, and
PCM Voyager Fund; and the Equity-Income Portfolio, Overseas Portfolio and Asset
Manager Portfolio. Applicants should read the prospectuses for each of the Funds
accompanying this Prospectus in connection with the purchase of a Policy. The
investment objectives of each of the Funds are as set forth in "Separate Account
VL I," page 23.
The investment adviser for the Hartford Funds is The Hartford Investment
Management Company, a wholly-owned subsidiary of Hartford Life Insurance
Company. The Hartford Investment Management Company retains a sub-investment
adviser with respect to some of the Funds. The Putnam Funds are advised by
Putnam Investment Management, Inc., a subsidiary of The Putnam Investments, Inc.
The Fidelity Funds are managed by Fidelity Management & Research Company. See
"Separate Account VL I," page 23.
FIXED ACCOUNT
Premium payments and Account Values allocated to the Fixed Account become
part of the general assets of ITT Hartford. ITT Hartford invests the assets of
the General Account in accordance with applicable law governing the investments
of insurance company general accounts.
DEDUCTIONS FROM THE PREMIUM
Before allocating the premium to the Account Value, a deduction as a
percentage of premium is made for the premium tax and federal tax charge and
front-end sales load. The amount of each premium allocated to the Account Value
is Your Net Premium.
7
<PAGE>
PREMIUM TAX CHARGE AND FEDERAL TAX CHARGE
We deduct, as a premium tax charge, a percentage of each premium to cover
premium-based taxes assessed against ITT Hartford by a state or other
governmental entity. This percentage will vary depending on the tax rates in
effect there and is based on the actual tax imposed. The range is generally
between 0% and 3.5%.
We also deduct a current charge of 1.25% of each premium for federal taxes
imposed under Section 848 of the Code.
FRONT-END SALES LOAD
The front-end sales load is a charge deducted from each premium payment. The
current and maximum front-end sales load for premium is 5.0% in the first Policy
Year and 2.0% in Policy Years 2 through 10. After Policy Year 10, the front-end
sales load is currently 0%. We reserve the right to charge a maximum of 2.0%.
DEDUCTIONS AND CHARGES FROM THE ACCOUNT VALUE
On each Monthly Activity Date, We will subtract the Monthly Deduction Amount
from Your Account Value. This will be taken on a Pro Rata Basis from the Fixed
Account and Sub-Accounts. The Monthly Deduction Amount equals:
1. the Cost of Insurance; plus
2. the Monthly Administrative Charge; plus
3. the Mortality and Expense Risk Charge; plus
4. the charges for additional benefits provided by rider, if any.
ITT Hartford may also set up a provision for income taxes against the assets
of Separate Account VL I. See "Deductions and Charges from the Account Value,"
page 20 and "Federal Tax Considerations," page 33.
Applicants should review the prospectuses for the Funds which accompany this
Prospectus for a description of the charges assessed against the assets of each
of the Funds.
ACCOUNT VALUE
As with many other types of insurance policies, each Policy will have an
Account Value. The Account Value of a Policy will increase to reflect interest
credited to the Fixed Account and Loan Account (when applicable) and any premium
payments. The Account Value of a Policy will decrease to reflect deductions for
the Monthly Deduction Amount and any withdrawals. The Account Value of a Policy
will vary to reflect the investment experience of the underlying Funds. There is
no minimum guaranteed Account Value and the Policy Owner bears the risk of the
investment in the Funds. However, if the Death Benefit guarantee is available,
the Policy will not lapse due to poor investment performance. See "Detailed
Description of the Policy Benefits and Provisions -- Account Values," page 10.
POLICY LOAN
A Policy Owner may obtain a cash loan from ITT Hartford. The loan is secured
by the Policy. At the time a loan is requested, the Indebtedness (including the
currently applied for loan) may not exceed the Cash Surrender Value. See
"Detailed Description of Policy Benefits and Provisions -- Policy Loans," page
12.
CHARGES AGAINST THE FUNDS
Separate Account VL I purchases shares of the Funds at net asset value. The
net asset value of the Fund shares reflects investment advisory fees and
administrative and other expenses already deducted from the assets of the Funds.
These charges are described herein. See Charges Against the Funds, page 21.
THE RIGHT TO EXAMINE OR EXCHANGE THE POLICY
An applicant has a limited right to return his or her Policy for
cancellation. If the applicant returns the Policy within: (1) ten days after
delivery of the Policy; (2) ten days after We mail or personally deliver a
Notice of Withdrawal Right; or (3) 45 days after completion of the application,
whichever is latest (subject to applicable state regulation), ITT Hartford will
return to the applicant, within seven days thereafter, the greater of the
8
<PAGE>
premium paid, less any Indebtedness, or the sum of (1) the Account Value, less
any Indebtedness, on the date the returned Policy is received by ITT Hartford or
its agent and (2) any deductions under Policy or by the Funds for taxes, charges
or fees.
In addition, once the Policy is in effect it may be exchanged during the
first 24 months after its Date of Issue for a non-variable life insurance policy
offered by Us on the life of the Insured without submitting proof of
insurability.
SURRENDER
At any time prior to the Scheduled Maturity Date, provided the Policy has a
Cash Surrender Value, you may surrender the Policy. During the first fifteen
(15) Policy Years, a Surrender Charge will apply. The Surrender Charge consists
of two component charges: administrative expenses surrender charge and a sales
surrender charge. See "Detailed Description of Policy Benefits and Provisions,"
and "Withdrawal", pages 9 and 16.
TAX CONSEQUENCES
The current federal tax law generally excludes all death benefit payments
from the gross income of the Policy Beneficiary. See "Federal Tax
Considerations," page 33.
DETAILED DESCRIPTION OF
POLICY BENEFITS AND PROVISIONS
GENERAL
This Prospectus describes a flexible premium variable life insurance policy
that has considerable flexibility in selecting the timing and amount of premium
payments.
PREMIUM
PREMIUM PAYMENT FLEXIBILITY
You have considerable flexibility as to when and in what amounts You pay
premium.
Prior to issue, You can choose a Planned Premium, within a range determined
by ITT Hartford based on the Face Amount and the Insured's sex (except where
unisex rates apply), Issue Age and risk classification. We will send You premium
notices for Planned Premium. The notices may be sent on an annual, semi-annual
or quarterly basis. You may also have premium automatically deducted from Your
checking account on a monthly basis. The Planned Premium and payment mode You
selected are shown on the Policy's specifications page. You may change the
Planned Premium at any time, subject to Our minimum amount rules then in effect.
The Policy will not lapse as long as the Cash Surrender Value is sufficient
to cover the Monthly Deduction Amounts or the Death Benefit guarantee is
available. See also "Lapse and Reinstatement" on page 15 for more details.
ALLOCATION OF PREMIUM PAYMENTS
The initial Net Premium will be allocated to the Hartford Money Market
Sub-Account on the later of the Policy Date or the date We receive the premium.
The value in this Hartford Money Market Sub-Account will then be allocated
to the Fixed Account and Sub-Accounts according to the premium allocation
specified in the application on the latest of: (1) 45 days after the application
is signed; (2) ten days after We receive the premium; (3) ten days after We mail
or personally deliver a Notice of Withdrawal Right; and (4) the date We receive
the final requirement to put the Policy in force ("free-look end date")
.
Any additional Net Premium received prior to the free-look end date will be
allocated to the Hartford Money Market Sub-Account.
9
<PAGE>
You may change Your premium allocation In Writing. Portions allocated to the
Fixed Account and Sub-Accounts must be whole percentages. Subsequent Net Premium
will be allocated to the Fixed Account and Sub-Accounts according to Your most
recent instructions, subject to the following. Currently, the Account Value may
be allocated to no more than nine Sub-Accounts. ITT Hartford reserves the right
to increase the number of allocable investment options beyond nine. If We
receive a premium and Your most recent allocation instructions would violate
this requirement, We will allocate the Net Premium to the Fixed Account and Sub-
Accounts on a Pro-Rata basis.
You will receive several different types of notification as to what Your
current premium allocation is. The initial allocation chosen by the Policy Owner
is shown in the Policy. Each transactional confirmation received after a premium
payment will show how that premium has been allocated. In addition, each
quarterly statement summarizes the current premium allocation in effect for that
Policy.
ACCUMULATION UNITS
Net Premium allocated to the Sub-Accounts are used to credit Accumulation
Units to those Sub-Accounts.
The number of Accumulation Units in each Sub-Account to be credited to a
Policy, including the initial allocation to Hartford Money Market Sub-Account
and the amount credited to the Fixed Account, will be determined first by
multiplying the Net Premium by the appropriate allocation percentage to
determine the portion to be invested in the Fixed Account or Sub-Account. Each
portion to be invested in a Sub-Account is then divided by the Accumulation Unit
Value of that particular Sub-Account next computed following receipt of the
payment.
ACCUMULATION UNIT VALUES
The Accumulation Unit Value for each Sub-Account will vary to reflect the
investment experience of the applicable Fund. It will be determined on each
Valuation Day by multiplying the Accumulation Unit Value of the particular
Sub-Account on the preceding Valuation Day by a Net Investment Factor for that
Sub-Account for the Valuation Period then ended. The Net Investment Factor for
each of the Sub-Accounts is equal to the net asset value per share of the
corresponding Fund at the end of the Valuation Period (plus the per share amount
of any dividend or capital gain distributions paid by that Fund in the Valuation
Period then ended) divided by the net asset value per share of the corresponding
Fund at the beginning of the Valuation Period.
All valuations in connection with a Policy, e.g., with respect to
determining Account Value, in connection with Policy loans, or in calculation of
Death Benefits, or with respect to determining the number of Accumulation Units
to be credited to a Policy with each premium payment, other than the initial
premium payment, will be made on the date the request or payment is received by
ITT Hartford at the National Service Center if such date is a Valuation Day;
otherwise such determination will be made on the next succeeding date which is a
Valuation Day.
PREMIUM LIMITATION
If a premium is received which would cause the Policy to fail to meet the
definition of a life insurance contract in accordance with the Internal Revenue
Code, We reserve the right to refund the excess premium. We will refund such
premium and interest thereon within 60 days after the end of a Policy Year.
We reserve the right to require evidence of insurability for any premium
that results in an increase in the Death Benefit greater than the amount of the
premium.
The minimum subsequent premium is $50.00. Any premium in excess of
$1,000,000 is subject to ITT Hartford's approval.
ACCOUNT VALUES
The Policy will have an Account Value. There is no minimum guaranteed
Account Value. The Account Value of a Policy changes on a daily basis and will
be computed on each Valuation Day. The Account Value of a Policy will increase
to reflect interest credited to the Fixed Account and Loan Account (when
applicable) and any premium payments. The Account Value will decrease to reflect
deductions for the Monthly Deduction Amount and any withdrawals. The Account
Value will vary to reflect the investment experience of the underlying Funds.
10
<PAGE>
The Account Value of a particular Policy is related to the net asset value
of the Funds associated with the Sub-Accounts, if any, to which premium payments
on the Policy have been allocated. The Account Value in the Sub-Accounts on any
Valuation Day is calculated by multiplying the number of Accumulation Units in
each Sub-Account as of the Valuation Day by the current Accumulation Unit Value
of that Sub-Account and then summing the result for all the Sub-Accounts. The
Account Value equals the Account Value in the Sub-Accounts plus the value of the
Fixed and Loan Accounts. The Cash Value equals the Account Value less any
applicable Surrender Charges. The Cash Surrender Value, which is the net amount
available upon surrender of the Policy, is the Cash Value less any Indebtedness.
See "Accumulation Unit Values," page 10.
AMOUNT PAYABLE ON SURRENDER OF THE POLICY
As long as the Policy is in effect, a Policy Owner may elect, without the
consent of the Beneficiary (provided the designation of Beneficiary is not
irrevocable), to fully surrender the Policy. Upon surrender, the Policy Owner
will receive the Cash Surrender Value determined as of the day ITT Hartford
receives the Policy Owner's written request or the date requested by the Policy
Owner, whichever is later. The Cash Surrender Value equals the Cash Value less
any Indebtedness. The Policy will terminate on the date of receipt of the
written request, or the date the Policy Owner requests the surrender to be
effective, whichever is later.
SALES LOAD REFUND
If a Policy is surrendered during the first two Policy Years, the Cash
Surrender Value may be adjusted upward to reflect a reduced Surrender Charge.
For purposes of this Policy, the reduction in Surrender Charge will be equal to
the excess, if any, of the sum of the actual front-end sales load and Sales
Surrender Charge to date over the sum of 30% of payments in aggregate amount
less than or equal to one Guideline Annual Premium plus 10% of payments in
aggregate amount greater than one Guideline Annual Premium but not more than two
Guideline Annual Premiums.
For purposes of this Policy, "Guideline Annual Premium" means the level
annual premium payment necessary to provide the future benefits under the Policy
through maturity, based on certain assumptions specified under the Federal
Securities laws. These assumptions include mortality charges based on the 1980
CSO Table, an assumed annual net rate of return of 5% per year, and deduction of
the fees and charges specified in the Policy. The Guideline Annual Premium is
only used in limiting front-end sales loads and Sales Surrender Charges.
WITHDRAWALS
One withdrawal is allowed each calendar month. The minimum withdrawal
allowed is $500. The maximum withdrawal is the Cash Surrender Value, less
$1,000. If the Death Benefit Option then in effect is Option A or Option C, the
Face Amount is decreased by an amount equal to the reduction in the Account
Value resulting from the withdrawal. The minimum Face Amount required after a
withdrawal is subject to Our rules then in effect. Unless specified otherwise,
the withdrawal will be deducted on a Pro Rata Basis from the Fixed Account and
the Sub-Accounts. Currently, ITT Hartford does not impose a withdrawal charge.
However, ITT Hartford reserves the right to impose a withdrawal charge of up to
$10.00.
In addition, a Surrender Charge will be deducted from the Account Value
equal to the proportion of the current Surrender Charge represented by the
amount of the withdrawal to the Account Value immediately prior to the
withdrawal.
Any decrease in the Face Amount resulting from a withdrawal may result in a
partial Surrender Charge. See "Increases and Decreases in Face Amount", page 15.
TRANSFERS OF ACCOUNT VALUE
AMOUNT AND FREQUENCY OF TRANSFERS
Upon request and as long as the Policy is in effect, You may transfer
amounts among the Fixed Account and Sub-Accounts. Transfers may be made by
written request or by calling toll free 1-800-231-5453. Transfers by telephone
may be made by the agent of record or by the attorney-in-fact pursuant to a
power of attorney. Telephone transfers may not be permitted in some states. The
policy of ITT Hartford and its agents and affiliates is that they will not be
responsible for losses resulting from acting upon telephone requests reasonably
believed to be genuine. We will employ reasonable procedures to confirm that
instructions communicated by telephone are genuine; otherwise, We may be liable
for any losses due to unauthorized or fraudulent
11
<PAGE>
instructions. The procedures We follow for transactions initiated by telephone
include requirements that callers provide certain identifying information for
themselves (if not the Policy Owner) and the Policy Owner. All transfer
instructions by telephone are tape recorded.
The amounts which may be transferred and the number of transfers will be
limited by Our rules then in effect.
Currently there are no restrictions on transfers other than those described
below. There is no charge currently for the first transfer in any calendar
month. Each transfer in excess of one per calendar month is subject to a
Transfer Charge of up to $25.
We reserve the right at a future date to limit the size of transfers and
remaining balances, and to limit the number and frequency of transfers.
TRANSFERS TO OR FROM SUB-ACCOUNTS
You may request to transfer some or all of your Account Value between the
Sub-Accounts. When You request a transfer, the number of Accumulation Units
credited to the Sub-Account from which the transfer was made will be reduced and
the number of Accumulation Units credited to the Sub-Account you requested will
be increased.
The amount of the increase or decrease will be determined by dividing:
1. the amount transferred by,
2. the Accumulation Unit Value for the respective Sub-Account determined as
of the next Valuation Day after We receive your transfer request.
TRANSFERS FROM THE FIXED ACCOUNT
In addition to the conditions above, transfers from the Fixed Account are
subject to the following:
1. the transfer must occur during the 30-day period following each Policy
Anniversary; and
2. if the Accumulated Value in Your Fixed Account exceeds $1,000, the
amount transferred in any Policy Year may be no larger than 25% of the
Accumulated Value in the Fixed Account on the date of transfer. We
reserve the right to modify the restrictions on transfers from the Fixed
Account.
POLICY LOANS
As long as the Policy is in effect, a Policy Owner may obtain, without the
consent of the Beneficiary (provided the designation of Beneficiary is not
irrevocable), a cash loan from ITT Hartford. The total Indebtedness at the time
of the new loan (including the accrued interest on prior loans plus the
currently applied for loan) may not exceed the Cash Surrender Value. The minimum
loan amount is $500.00.
The amount of each loan will be transferred on a Pro Rata Basis from the
Fixed Account and each of the Sub-Accounts (unless the Policy Owner specifies
otherwise) to the Loan Account. The Loan Account is a mechanism used to ensure
that any outstanding Indebtedness remains fully secured by the Account Value.
PREFERRED LOAN
If, at any time after the tenth Policy Anniversary, the Account Value
exceeds the total of all premium paid since issue, a Preferred Loan is
available. The amount available for a Preferred Loan is the amount by which the
Account Value exceeds total premium paid. The amount of the Loan Account which
equals a Preferred Loan will be credited with interest at a rate equal to the
Fixed Account Minimum Credited Rate. The amount of Indebtedness that qualifies
as a Preferred Loan is determined on each Monthly Activity Date. A lower
interest is charged to Preferred Loans than to the rest of your Indebtedness, if
any.
12
<PAGE>
LOAN INTEREST
Interest will accrue on Indebtedness on a daily basis. The table below shows
the interest rate We will charge on Your Indebtedness.
<TABLE>
<CAPTION>
PORTION OF FIXED ACCOUNT
POLICY YEAR INDEBTEDNESS MINIMUM CREDITED RATE PLUS
- -------------- ----------------------------------------------------- -------------------------------
<S> <C> <C>
1-10 All Indebtedness 2%
11 and later Preferred loans (if any) 0%
All Indebtedness in excess of Preferred Loans 1%
</TABLE>
CREDITED INTEREST
Any amounts in the Loan Account will be credited with interest at a rate
equal to the Fixed Account Minimum Credited Rate.
LOAN REPAYMENTS
You can repay all or any part of the entire Indebtedness at any time while
Your Policy is in force. Each loan repayment must be at least $50. An amount
equal to the loan repayment will be deducted from the Loan Account and will be
allocated among the Fixed Account and Sub-Accounts in the same percentage as
premium are allocated.
TERMINATION DUE TO EXCESSIVE INDEBTEDNESS
If total Indebtedness equals or exceeds the Cash Value on any Monthly
Activity Date, the Policy will terminate. See "Lapse and Reinstatement," page
15.
EFFECT OF LOANS ON ACCOUNT VALUE
A loan, whether or not repaid, will have a permanent effect on the Account
Value because the investment results of each Sub-Account will apply only to the
amount remaining in such Sub-Accounts. In addition, the rate of interest
credited to the Fixed Account may be greater than the Fixed Account Minimum
Credited Rate. The longer a loan is outstanding, the greater the effect, whether
favorable or unfavorable, is likely to be. If the Fixed Account and the
Sub-Accounts earn more than the annual interest rate for funds held in the Loan
Account, a Policy Owner's Account Value will not increase as rapidly as it would
have had no loan been made. If the Sub-Accounts earn less than the Loan Account,
the Policy Owner's Account Value will be greater than it would have been had no
loan been made. Also, if not repaid, the aggregate amount of the outstanding
loan (i.e., the Indebtedness) will reduce the Death Proceeds and Cash Surrender
Value otherwise payable.
DEATH BENEFIT
The Policy provides for the payment of the Death Proceeds to the named
Beneficiary when the Insured dies. The Death Proceeds payable to the Beneficiary
equal the Death Benefit less any Indebtedness and less any due and unpaid
Monthly Deduction Amount occurring during a Grace Period. The Death Benefit
depends on the Death Benefit Option selected by You, the minimum Death Benefit
provision, and whether or not the Death Benefit guarantee is available. All or
part of the Death Proceeds may be paid in cash or applied under a "Payment
Option." See "Other Matters -- Payment Options," page 29.
DEATH BENEFIT OPTIONS
There are three Death Benefit Options: the Level Death Benefit Option
("Option A"), the Return of Account Value Death Benefit Option ("Option B") and
the Return of Premium Death Benefit Option ("Option C"). Subject to the minimum
Death Benefit described below, the Death Benefits under each option are:
1. Under Option A, the Death Benefit is equal to the Face Amount.
2. Under Option B, the Death Benefit is equal to the Face Amount plus the
Account Value.
3. Under Option C, the Death Benefit is equal to the Face Amount plus the
lesser of: (a) the sum of the premium paid; and (b) the Option C Limit.
13
<PAGE>
OPTION CHANGE
You may change Your Death Benefit Option by notifying Us In Writing of the
change. Such change will become effective on the Monthly Activity Date following
the date we receive Your request. If a change to Option A is elected, the Face
Amount will become that amount available as a Death Benefit immediately prior to
the option change. If a change to Option B is elected, the Face Amount will
become that amount available as a Death Benefit immediately prior to the option
change, reduced by the then current Account Value. Changing your Death Benefit
Option may result in a Surrender Charge. (See "Decreases in Face Amount", page
15.) You should consult a competent tax adviser regarding the possible adverse
tax consequences resulting from a change in your Death Benefit Option.
DEATH BENEFIT GUARANTEE
The Death Benefit guarantee will keep the Policy in force, regardless of the
Policy's investment performance as long as the following conditions are met:
1. the Policy is in the first ten Policy Years (except in certain states
where a period less than 10 years may apply); and
2. on each Monthly Activity Date during that period, the cumulative premium
paid into this Policy, less Indebtedness, less any withdrawals, equal or
exceed the Cumulative Death Benefit Guarantee premium on that date.
If the Face Amount has not been increased or decreased, the Cumulative Death
Benefit Guarantee Premium is:
1. the Cumulative Death Benefit Guarantee Premium on the previous Monthly
Activity Date; plus
2. the current Monthly Death Benefit Guarantee Premium shown on the Policy
specification page.
The Monthly Death Benefit Guarantee Premium will be adjusted to reflect any
increases or decreases in the Face Amount during the Death Benefit guarantee
period. We will send You a schedule showing the new Monthly Death Benefit
Guarantee Premium required for this period and the Death Benefit Guarantee
Premium received to date.
While the Death Benefit guarantee is available, the Death Benefit will be
the Face Amount, regardless of the Death Benefit Option.
MINIMUM DEATH BENEFIT
The Policy has a minimum Death Benefit feature which automatically increases
the Death Benefit so that it will never be less than the Account Value
multiplied by the Minimum Death Benefit Percentage specified in the Policy. This
percentage varies according to the Insured's Issue Age, the Policy Year, sex
(where unisex rates are not used) and insurance class.
EXAMPLES OF THE MINIMUM DEATH BENEFIT:
<TABLE>
<CAPTION>
A B
----------- -----------
<S> <C> <C>
Face Amount $ 100,000 $ 100,000
Account Value on Date of Death 46,500 34,000
Specified Percentage 250% 250%
Death Benefit Option Level Level
</TABLE>
In Example A, the minimum Death Benefit equals $116,250, i.e., the greater
of $100,000 (the Face Amount) or $116,250 (the Account Value at the Date of
Death of $46,500, multiplied by the specified percentage of 250%). This amount
less any outstanding Indebtedness constitutes the Death Proceeds which We would
pay to the Beneficiary.
In Example B, the minimum Death Benefit is $100,000, i.e., the greater of
$100,000 (the Face Amount) or $85,000 (the Account Value of $34,000 multiplied
by the specified percentage of 250%).
14
<PAGE>
INCREASES AND DECREASES IN FACE AMOUNT
At any time after the first Policy Year, You may make a request In Writing
to change the Face Amount. The minimum amount by which the Face Amount can be
increased or decreased is based on Our rules then in effect. We reserve the
right to limit the number of increases or decreases made under the Policy to not
more than one in any 12 month period.
A decrease in the Face Amount will be effective on the Monthly Activity Date
following the date We receive Your request. The remaining Face Amount must not
be less than that allowed by Our minimum rules then in effect. If You ask to
decrease Your Face Amount below the Initial Face Amount a Surrender Charge may
be assessed, equal to:
1. the Surrender Charge applicable to the current Policy Year; multiplied
by
2. the percentage described below.
The percentage used to determine the Surrender Charge will be calculated by:
1. subtracting the requested Face Amount from the lowest Face Amount prior
to the request; and
2. dividing that difference by the lowest Face Amount prior to the request.
The Surrender Charge assessed will be deducted from Your Account Value on
the Monthly Activity Date effective for the decrease.
All requests to increase the Face Amount must be applied for on a new
application and accompanied by the Policy. All requests will be subject to
evidence of insurability satisfactory to Us. Any increase approved by Us will be
effective on the date shown on the new policy specifications page, provided that
the Monthly Deduction Amount for the first month after the effective date of
increase is made.
BENEFITS AT MATURITY
If the Insured is living on the Scheduled Maturity Date, on surrender of the
Policy to ITT Hartford, ITT Hartford will pay to the Policy Owner the Cash
Surrender Value. On the Scheduled Maturity Date, unless extended by rider, the
Policy will terminate and ITT Hartford will have no further obligations under
the Policy.
LAPSE AND REINSTATEMENT
POLICY LAPSE AND GRACE PERIOD
During the first Policy Year, the Policy will be in default on any Monthly
Activity Date on which the Account Value less Indebtedness is not sufficient to
cover the Monthly Deduction Amount.
During the second Policy Year, the Policy will be in default on any Monthly
Activity Date on which the Account Value less Indebtedness less 1/2 of the
Surrender Charge for the second Policy Year is not sufficient to cover the
Monthly Deduction Amount.
During the third Policy Year and thereafter, the Policy will be in default
on any Monthly Activity Date if the Cash Surrender Value is not sufficient to
cover the Monthly Deduction Amount.
A 61-day period called the "Grace Period" will begin from the date of
default. ITT Hartford will mail the Owner and any assignee written notice of the
amount of premium that will be required to continue the Policy in force. The
premium required will be no greater than the amount required to pay Monthly
Deduction Amounts during the Grace period plus three additional Monthly
Deduction Amounts. Unless the Death Benefit guarantee is available, the Policy
will terminate without value if the required premium is not paid by the end of
the Grace Period. If the Death Benefit guarantee is available and sufficient
premium has not been paid by the end of the Grace Period, the Death Benefit will
be reduced to the Face Amount and any riders will no longer be in force. If the
Insured dies during the Grace Period, We will pay the Death Proceeds.
DEATH BENEFIT GUARANTEE DEFAULT AND GRACE PERIOD
On every Monthly Activity Date during the Death Benefit guarantee period, We
will compare the cumulative premium received, less Indebtedness, less
withdrawals, to the Cumulative Death Benefit Guarantee Premium for the Death
Benefit guarantee period in effect.
15
<PAGE>
If the cumulative premium received, less Indebtedness, less withdrawals, are
less than the Cumulative Death Benefit Guarantee Premium, the Death Benefit
guarantee will be deemed to be in default as of that Monthly Activity Date. A
Grace Period of 61 days from the date of default will begin. We will mail the
Policy Owner and any assignee written notice of the amount of premium required
to continue the Death Benefit guarantee.
At the end of the Grace Period, the Death Benefit guarantee will be removed
from the Policy if We have not received the amount of the required premium.
REINSTATEMENT
Unless the Policy has been surrendered for its Cash Surrender Value, the
Policy may be reinstated prior to the Scheduled Maturity Date, provided:
1. You make Your request In Writing within five years from the termination
date;
2. satisfactory evidence of insurability is submitted;
3. any Indebtedness existing at the time of termination is repaid or
carried over to the reinstated Policy; and
4. You pay a premium sufficient to cover (1) all Monthly Deduction Amounts
that are due and unpaid during the Grace Period; and (2) the sum of
Monthly Deduction Amounts for the next three months after the date of
reinstatement.
The Account Value on the reinstatement date will equal:
1. The Cash Value at the time of termination; plus
2. Net Premium derived from premium paid at the time of reinstatement;
minus
3. the Monthly Deduction Amounts that were due and unpaid during the Policy
Grace Period; plus
4. the Surrender Charge at the time of reinstatement. The Surrender Charge
is based on the duration from the original Policy Date.
THE RIGHT TO EXAMINE OR EXCHANGE THE POLICY
An applicant has a limited right to return a Policy for cancellation. If the
Policy is returned, by mail or personal delivery to ITT Hartford or to the agent
who sold the Policy, to be canceled within ten days after delivery of the Policy
to the Policy Owner, within 10 days of ITT Hartford's mailing or personal
delivery of a Notice of Right to Withdraw, or within 45 days of completion of
the Policy application (whichever is later, and subject to applicable state
regulation), ITT Hartford will return to the applicant, within seven days
thereafter, the greater of the premium paid, less any Indebtedness, or the sum
of (1) the Account Value, less any Indebtedness, on the date the returned Policy
is received by ITT Hartford or its agent and (2) any deductions under the Policy
or by the Funds for taxes, charges or fees.
Once the Policy is in effect, it may be exchanged during the first 24 months
after its issuance, for a non-variable life insurance policy offered by Us or an
affiliate. No evidence of insurability will be required. The new policy will
have an amount at risk which equals or is less than the amount at risk in effect
on the date of exchange. Premium under the new policy will be based on the same
risk classification as this Policy. An exchange of the Policy under these
circumstances should be a tax-free transaction under Section 1035 of the Code.
WITHDRAWAL
At any time prior to the Scheduled Maturity Date, provided the Policy has a
Cash Surrender Value, You may surrender the Policy or withdraw money from it.
During the first fifteen (15) Policy Years, a Surrender Charge will apply. The
Surrender Charge consists of two component charges: an administrative expense
surrender charge and a sales surrender charge.
16
<PAGE>
ADMINISTRATIVE EXPENSE SURRENDER CHARGE
The Administrative Expense Surrender Charge varies by the Insured's age on
the Date of Issue. Your sales representative can provide you with the actual
Administrative Expense Surrender Charge that applies to your Issue Age. The
following table represents the Administrative Expense Surrender Charge for a
person age 45 on the Date of Issue:
<TABLE>
<CAPTION>
AMOUNT PER $1,000 OF AMOUNT PER $1,000 OF
POLICY YEAR INITIAL FACE AMOUNT POLICY YEAR INITIAL FACE AMOUNT
- ----------- ----------------------- --------------- -----------------------
<S> <C> <C> <C>
1 $ 5.00 9 $ 3.18
2 $ 5.00 10 $ 2.73
3 $ 5.00 11 $ 2.27
4 $ 5.00 12 $ 1.82
5 $ 5.00 13 $ 1.36
6 $ 4.55 14 $ 0.91
7 $ 4.09 15 $ 0.45
8 $ 3.64 16 $ 0.00
</TABLE>
The amount of the charge remains level for five Policy Years. After the
fifth Policy Anniversary, the charge decreases uniformly each month until the
end of the fifteenth Policy Year when it is zero.
The Administrative Expense Surrender Charge is designed to cover the
administrative expenses associated with underwriting and issuing a Policy,
including the costs of processing applications, conducting medical examinations,
determining insurability and the Insured's underwriting class, and establishing
policy records.
The sum of the Administrative Expense Surrender Charge and the Monthly
Administrative Charge will not exceed the cost ITT Hartford incurs in providing
administrative services under the Policy. ITT Hartford does not expect to profit
from the Administrative Expense Surrender Charge.
SALES SURRENDER CHARGE
The Sales Surrender Charge varies by the Insured's age on the Date of Issue.
Your sales representative can provide you with the actual Sales Surrender Charge
that applies to your Issue Age. The following table represents the Sales
Surrender Charge for a person age 45 on the Date of Issue:
<TABLE>
<CAPTION>
AMOUNT PER $1,000 OF AMOUNT PER $1,000 OF
POLICY YEAR INITIAL FACE AMOUNT POLICY YEAR INITIAL FACE AMOUNT
- ----------- ----------------------- --------------- -----------------------
<S> <C> <C> <C>
1 $ 7.00 9 $ 4.45
2 $ 7.00 10 $ 3.82
3 $ 7.00 11 $ 3.18
4 $ 7.00 12 $ 2.55
5 $ 7.00 13 $ 1.91
6 $ 6.36 14 $ 1.27
7 $ 5.73 15 $ 0.64
8 $ 5.09 16 $ 0.00
</TABLE>
The amount of the charge remains level for five Policy Years. After the
fifth Policy Anniversary, the charge decreases uniformly each month until the
end of the fifteenth Policy Year when it is zero.
The Sales Surrender Charges is designed to cover expenses relating to the
sale and distribution of the Policy, including commissions paid to any sales
personnel, the cost of preparing sales literature and other promotional
activities.
VALUATION OF PAYMENTS AND TRANSFERS
We value the Policy on every Valuation Day.
We will pay Death Proceeds, Cash Surrender Values, Withdrawals, and loan
amounts allocable to the Sub-Accounts within seven (7) days after We receive all
the information needed to process the payment unless the New York Stock Exchange
is closed for other than a regular holiday or weekend, trading is restricted by
the Securities and Exchange Commission ("SEC") or that the SEC declares that an
emergency exists.
17
<PAGE>
ITT Hartford may defer payment of any amounts not allocable to the
Sub-Accounts for up to six months from the date on which We receive the request.
APPLICATION FOR A POLICY
Individuals wishing to purchase a Policy must submit an application to ITT
Hartford. Within limits, an applicant may choose the initial Face Amount. A
Policy generally will be issued only on the lives of Insureds between the ages
of 0 and 80 who supply evidence of insurability satisfactory to ITT Hartford.
Acceptance is subject to ITT Hartford's underwriting rules. ITT Hartford
reserves the right to reject an application for any reason.
The Policy will be effective on the Policy Date only after ITT Hartford has
received all outstanding delivery requirements and received the initial premium.
The Policy Date is the date used to determine all future cyclical transactions
on the Policy, e.g., Monthly Activity Date, Policy Months and Policy Years.
REDUCED CHARGES FOR ELIGIBLE GROUPS
Certain charges and deductions described below may be reduced for a Policy
issued in connection with a specific plan in accordance with Our rules in effect
as of the date an application for a Policy is approved. To qualify for such a
reduction, a plan must satisfy certain criteria as to, for example, size of the
plan, expected number of participants and anticipated premium payment from the
plan. Generally, the sales contacts and effort, administrative costs and
mortality cost per Policy vary based on such factors as the size of the plan,
the purposes for which the Policy is purchased and certain characteristics for
the plan's members. The amount of reduction and the criteria for qualification
are a reflection of the reduced sales effort and administrative costs resulting
from, and the different mortality experience expected as a result of, sales to
qualifying plans. We may modify from time to time on a uniform basis both the
amounts of reductions and the criteria for qualification. Reductions in these
charges will not be unfairly discriminatory against any person, including the
affected Policy Owners funded by Separate Account VL I.
DEDUCTIONS FROM THE PREMIUM
Before allocating the premium to the Account Value, a deduction is made for
the premium tax and federal tax charge and front-end sales load. The amount of
each premium allocated to the Account Value is Your Net Premium.
PREMIUM TAX CHARGE AND FEDERAL TAX CHARGE
We deduct, as a premium tax charge, a percentage of each premium to cover
premium-based taxes assessed against ITT Hartford by a state or other
governmental entity. This percentage will vary depending on the tax rates in
effect there and is based on the actual tax imposed. The range is generally
between 0% and 3.5%.
We also deduct a 1.25% charge from each premium payment to cover the
estimated costs to Us of the federal income tax treatment of the Policy's
deferred acquisition costs under Section 848 of the Code. We have determined
that this charge is reasonable in relation to our increased federal income tax
burden under the Code resulting from the receipt of premium.
The Federal Tax Charge is a factor ITT Hartford must use when computing the
maximum sales load chargeable under Securities and Exchange Commission rules.
FRONT-END SALES LOAD
The front-end sales load is a charge deducted from each premium. The current
and maximum front-end sales load for all premium is 5.0% in the first Policy
Year and 2.0% for Policy Years 2 through 10. After Policy Year 10, the front-end
sales load is currently 0%. We reserve the right to charge a maximum of 2.0%.
18
<PAGE>
EXAMPLES OF FRONT-END SALES LOADS/IMPACT OF REFUND OF SALES LOAD
An example of the actual Front-End Sales Loads and the impact of the refund
of the load, if any, (see "Sales Load Refund" on page 11), for a Policy is shown
below. This example uses the same specific information (i.e., Issue Age, Face
Amount, premium level, etc.) as the illustration on page 39 of the prospectus.
<TABLE>
<S> <C>
Death Benefit Option: Level
Face Amount: $250,000
Charges Assumed: Current
Issue Age/Sex/Class: 45/Male/Preferred
Guideline Annual Premium: $4,483.41
Annual Planned Premium: $3,250.00
Assumed Gross Annual Investment Return 0%
</TABLE>
The Total Cumulative Sales Load column on the far right of the table below
represents the sum of all loads which would have been assessed since the issue
of the policy assuming a surrender of the Policy at the end of the corresponding
policy year.
This is:
(1) The sum of the Cumulative Front-End Sales Load, plus
(2) The actual Surrender Charge for that Policy Year, minus
(3) The Sales Load Refund, if any, applicable to that Policy year.
ADDITIONAL CHARGES/CREDITS IF SURRENDERED
<TABLE>
<CAPTION>
CUMULATIVE TOTAL
FRONT-END MAXIMUM YEAR END ACTUAL SALES SALES CUMULATIVE
POLICY SALES SURRENDER ACCOUNT SURRENDER SURRENDER LOAD SALES LOAD IF
YEAR LOAD CHARGE VALUE CHARGE CHARGES REFUND SURRENDERED**
- ----------- ------------- ----------- ----------- ----------- ----------- ----------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C>
1 65 3,000 1,880 1,880 630 0 695
2 130 3,000 3,849 3,000 1,750 333 1,547
3 195 3,000 5,724 3,000 1,750 0 1,945
4 260 3,000 7,498 3,000 1,750 0 2,010
5 325 3,000 9,247 3,000 1,750 0 2,075
6 390 2,727 10,887 2,727 1,590 0 1,980
7 455 2,455 12,433 2,455 1,433 0 1,888
8 520 2,183 13,878 2,183 1,273 0 1,793
9 585 1,910 15,212 1,910 1,113 0 1,698
10 650 1,638 16,429 1,638 955 0 1,605
11 715 1,363 17,807 1,363 795 0 1,510
12 780 1,090 19,172 1,090 638 0 1,418
13 845 818 20,385 818 478 0 1,323
14 910 545 21,431 545 318 0 1,228
15 975 273 22,292 273 160 0 1,135
16 1040 0 22,949 0 0 0 1,040
</TABLE>
- ------------------------
* The Actual Surrender Charge assessed is the smaller of:
(a) The contractual maximum surrender charge, or
(b) Year-End Account Value
** The Total Cumulative Sales Load If Surrendered assumes a surrender of the
Policy at the end of that Policy Year and is:
(a) The Cumulative Front-End Sales Load, plus
(b) Sales Surrender Charge, minus
(c) Sales Load Refund.
19
<PAGE>
DEDUCTIONS AND CHARGES FROM THE ACCOUNT VALUE
MONTHLY DEDUCTION AMOUNTS
On the Policy Date and on each subsequent Monthly Activity Date, ITT
Hartford will deduct an amount (the "Monthly Deduction Amount") from the Account
Value to cover certain charges and expenses incurred in connection with a
Policy. Each Monthly Deduction Amount will be deducted on a Pro Rata Basis from
the Fixed Account and each of the Sub-Accounts. The Monthly Deduction Amount
will vary from month to month.
The Monthly Deduction Amount equals:
1. the charge for the Cost of Insurance; plus
2. the Monthly Administrative charge; plus
3. the Mortality and Expense Risk Charge; plus
4. the charges for additional benefits provided by rider.
1. COST OF INSURANCE CHARGE
The charge for the Cost of Insurance is equal to:
(a) the Cost of Insurance rate per $1,000; multiplied by
(b) the amount at risk; divided by
(c) $1,000
The amount at risk equals the Death Benefit less the Account Value on that
date, prior to assessing the Monthly Deduction Amount.
A charge for a special insurance class rating of an Insured may be made
against the Account Value, if applicable. This charge is to compensate ITT
Hartford for the additional mortality risk associated with individuals in these
classes.
The Cost of Insurance charge is to cover ITT Hartford's anticipated
mortality costs and other expenses. For standard risks, the Cost of Insurance
rates will not exceed those based on the 1980 Commissioners' Standard Ordinary
Mortality Smoker or Nonsmoker Table, age last birthday. A table of guaranteed
Cost of Insurance rates per $1,000 will be included in each Policy; however, ITT
Hartford reserves the right to use rates less than those shown in the table.
Substandard risks will be charged a higher Cost of Insurance rate that will not
exceed rates based on a multiple of the 1980 Commissioners' Standard Ordinary
Mortality Smoker or Nonsmoker Table, age last birthday. The multiple will be
based on the Insured's risk class. ITT Hartford will determine the Cost of
Insurance rate at the start of each Policy Year. Any changes in the Cost of
Insurance rate will be made uniformly for all Insureds of the same issue age,
sex and risk class and whose coverage has been inforce for the same length of
time. No change in insurance class or cost will occur on account of
deterioration of the Insured's health.
Because the Account Value and the Death Benefit under a Policy may vary from
month to month, the Cost of Insurance charge may also vary on each Monthly
Activity Date.
2. MONTHLY ADMINISTRATIVE CHARGE
ITT Hartford will assess a Monthly Administrative Charge to reimburse ITT
Hartford for administrative costs in connection with the Policy. The current
Monthly Administrative Fee is $25.00 per month for the first Policy Year, $10.00
per month in Policy Year 2-10 and $5.00 per month in Policy Years 11 and later,
not to exceed $7.50 per month in Policy Years 11 and later.
The sum of the Monthly Administrative Charge and the Administrative Services
Sales Charge will not exceed the cost ITT Hartford incurs in providing
administrative services under the Policy.
3. MORTALITY AND EXPENSE RISK CHARGE
A charge is made for mortality and expense risks assumed by ITT Hartford.
ITT Hartford may profit from this charge. See also, "Policy Benefits and Rights
- -- Account Values," page 10.
20
<PAGE>
The current Mortality and Expense Risk Charge for any Monthly Activity Date
is equal to:
(a) the current Mortality and Expense Risk Rate; multiplied by
(b) the portion of the Account Value allocated to the Sub-Accounts on the
Monthly Activity Date prior to assessing the Monthly Deduction Amount.
The current and guaranteed Mortality and Expense Risk Rate for the first ten
Policy Years is 0.80% (.067% per month). After the tenth Policy Year, the
current rate is 0.25% (.021% per month), with a maximum Rate of 0.50% (.042% per
month).
The mortality risk assumed is that the Cost of Insurance charges specified
in the Policy will be insufficient to meet actual claims. The expense risk
assumed is that expenses incurred in issuing and administering the Policy will
exceed the administrative charges set in the Policy. ITT Hartford may profit
from the mortality and expense risk charge and may use any profits for any
proper purpose, including any difference between the cost it incurs in
distributing the Policy and the proceeds of the front-end sales load.
4. RIDER CHARGE
If the Policy includes riders, a charge is made applicable to the riders
from the Account Value on each Monthly Activity Date. The charge applicable to
these riders is to compensate ITT Hartford for anticipated cost of providing
these benefits and are specified on the applicable rider. The riders available
are described on page 30 under "Supplemental Benefits" section.
CHARGES AGAINST THE FUNDS
The investment advisers charge the Funds an investment management fee on a
daily basis as compensation for services. The following Table shows the fee
charged for each Fund available for investment by Policy Owners.
<TABLE>
<CAPTION>
ANNUAL INVESTMENT MANAGEMENT FEE AS A
HARTFORD FUNDS PERCENTAGE OF AVERAGE DAILY NET ASSETS
- ----------------------------------------------------- -----------------------------------------------------------------
<S> <C>
Hartford Capital Appreciation Fund, Inc.,
Hartford Advisers Fund, Inc.,
Hartford International Opportunities Fund, Inc.,
Hartford Dividend and Growth Fund, Inc. .575% of the first $250 million of average net assets
.525% of the next $250 million of average net assets
.475% of the next $250 million of average net assets
.425% of any amount over $1.0 billion
Hartford Bond Fund, Inc.,
Hartford Stock Fund, Inc. .325% of the first $250 million of average net assets
.300% of the next $250 million of average net assets
.275% of the next $250 million of average net assets
.250% of any amount over $1.0 billion
Hartford Index Fund, Inc. .20%
Hartford Mortgage Securities Fund, Inc.,
HVA Money Market Fund, Inc. .25%
PUTNAM FUNDS
PCM Diversified Income Fund,
PCM Global Asset Allocation Fund,
PCM High Yield Fund,
PCM New Opportunities Fund,
PCM Voyager Fund .70% of the first $500 million of average net assets
.60% of the next $500 million of average net assets
.55% of the next $500 million of average net assets
.50% of any amount over $1.5 billion
</TABLE>
21
<PAGE>
<TABLE>
<CAPTION>
ANNUAL INVESTMENT MANAGEMENT FEE AS A
HARTFORD FUNDS PERCENTAGE OF AVERAGE DAILY NET ASSETS
- ----------------------------------------------------- -----------------------------------------------------------------
PCM Growth and Income Fund .65% of the first $500 million of average net assets
.55% of the next $500 million of average net assets
.50% of the next $500 million of average net assets
.45% of any amount over $1.5 billion
<S> <C>
PCM Money Market Fund .45% of the first $500 million of average net assets
.35% of the next $500 million of average net assets
.30% of the next $500 million of average net assets
.25% of any amount over $1.5 billion
PCM U.S. Government and High Quality Bond Fund .65% of the first $500 million of average net assets
.55% of the next $500 million of average net assets
.50% of the next $500 million of average net assets
.45% of the next $5 billion of average net assets
.425% of the next $5 billion of average net assets
.405% of the next $5 billion of average net assets
.39% of the next $5 billion of average net assets
.38% of any excess thereafter
PCM Global Growth Fund, PCM Utilities
Growth and Income Fund .60%
FIDELITY FUNDS
Equity-Income Portfolio .52%
Overseas Portfolio .77%
Asset Manager Portfolio .72%
</TABLE>
TAXES
Currently, no charge is made to Separate Account VL I for federal, state,
and local taxes that may be allocable to Separate Account VL I. A change in the
applicable federal, state or local tax laws which impose tax on ITT Hartford
and/or Separate Account VL I may result in a charge against the Policy in the
future. Charges for other taxes, if any, allocable to Separate Account VL I may
also be made.
THE COMPANY
ITT Hartford Life and Annuity Insurance Company ("ITT Hartford"), formerly
ITT Life Insurance Corporation, was originally incorporated under the laws of
Wisconsin on January 9, 1956. ITT Hartford was redomiciled to Connecticut on May
1, 1996. It is a stock life Insurance Company engaged in the business of writing
both individual and group life insurance and annuities in all states including
the District of Columbia, except New York. The offices of ITT Hartford are
located in Minneapolis, Minnesota; however, its mailing address is P.O. Box
2999, Hartford, Connecticut 06104-2999.
ITT Hartford is a wholly owned subsidiary of Hartford Life Insurance
Company. ITT Hartford is ultimately 100% owned by Hartford Fire Insurance
Company, one of the largest multiple lines insurance carriers in the United
States. On December 20, 1995, Hartford Fire Insurance Company became an
independent, publicly traded corporation.
ITT Hartford is rated A+ (superior) by A.M. Best and Company, Inc. on the
basis of its financial soundness and operating performance. ITT Hartford is
rated AA+ by both Standard & Poor's and Duff and Phelps on the basis of its
claims paying ability.
These ratings do not apply to the performance of the Separate Account.
However, the contractual obligations under this variable life insurance policy
are the general corporate obligations of ITT Hartford. These ratings do apply to
ITT Hartford's ability to meet its insurance obligations under the Policy.
22
<PAGE>
ITT Hartford is subject to Connecticut law governing insurance companies and
is regulated and supervised by the Connecticut Commissioner of Insurance. An
annual statement in a prescribed form must be filed with that Commissioner on or
before March 1 in each year covering the operations of ITT Hartford for the
preceding year and its financial condition on December 31 of such year.
Its books and assets are subject to review or examination by the
Commissioner or his agents at all times. A full examination of its operations is
conducted by the National Association of Insurance Commissioners at least once
every four years. In addition, ITT Hartford is subject to the insurance laws and
regulations of any jurisdiction in which it sells its insurance policies. ITT
Hartford is also subject to various federal and state securities laws and
regulations.
SEPARATE ACCOUNT VL I
GENERAL
Separate Account VL I is a separate account of ITT Hartford established on
June 8, 1995 pursuant to the insurance laws of the State of Connecticut and
organized as a unit investment trust registered with the Securities and Exchange
Commission under the Investment Company Act of 1940. Separate Account VL I meets
the definition of "separate account" under federal securities law. Under
Connecticut law, the assets of Separate Account VL I are held exclusively for
the benefit of Policy Owners and persons entitled to payments under the Policy.
The assets for Separate Account VL I are not chargeable with liabilities arising
out of any other business which ITT Hartford may conduct.
FUNDS
The assets of each Sub-Account of Separate Account VL I are invested
exclusively in one of the Funds. A Policy Owner may allocate premium payments
among the Sub-Accounts. Policy Owners should review the following brief
descriptions of the investment objectives of each of the Funds in connection
with that allocation. There is no guarantee that any of the Funds will achieve
its stated objectives. Policy Owners are also advised to read the prospectuses
for each of the Funds accompanying this prospectus for more detailed
information.
HARTFORD FUNDS
HARTFORD ADVISERS FUND, INC.
To achieve maximum long term total rate of return consistent with prudent
investment risk by investing in common stock and other equity securities, bonds
and other debt securities, and money market instruments. The investment adviser
will vary the investments of the Fund among equity and debt securities and money
market instruments depending upon its analysis of market trends. Total rate of
return consists of current income, including dividends, interest and discount
accruals and capital appreciation.
HARTFORD BOND FUND, INC.
To achieve maximum current income consistent with preservation of capital by
investing primarily in bonds.
HARTFORD CAPITAL APPRECIATION FUND, INC.
To achieve growth of capital by investing in equity securities and
securities convertible into equity securities selected solely on the basis of
potential for capital appreciation; income, if any, is an incidental
consideration.
HARTFORD DIVIDEND AND GROWTH FUND, INC.
To achieve a high level of current income consistent with growth of capital
and reasonable investment risk by investing primarily in equity securities and
securities convertible into equity securities.
23
<PAGE>
HARTFORD INDEX FUND, INC.
To provide investment results which approximate the price and yield
performance of publicly-traded common stocks in the aggregate, as represented by
the Standard & Poor's 500 Composite Stock Price Index.*
HARTFORD INTERNATIONAL OPPORTUNITIES FUND, INC.
To achieve long-term total return consistent with prudent investment risk
through investment primarily in equity securities issued by foreign companies.
HARTFORD MORTGAGE SECURITIES FUND, INC.
To achieve maximum current income consistent with safety of principal and
maintenance of liquidity by investing primarily in mortgage-related securities,
including securities issued by the Government National Mortgage Association
("GNMA").
HARTFORD STOCK FUND, INC.
To achieve long-term capital growth primarily through capital appreciation,
with income a secondary consideration, by investing in equity-type securities.
HVA MONEY MARKET FUND, INC.
To achieve maximum current income consistent with liquidity and preservation
of capital by investing in money market securities.
* "Standard & Poor's-Registered Trademark-", "S&P-Registered Trademark-",
"S&P 500-Registered Trademark-", "Standard & Poor's 500", and "500" are
trademarks of The McGraw-Hill Companies, Inc. and have been licensed for
use by Hartford Life Insurance Company and affiliates. The Hartford Index
Fund, Inc. ("Index Fund") is not sponsored, endorsed, sold or promoted by
Standard & Poor's ("S&P") and S&P makes no representation regarding the
advisability of investing in the Index Fund.
PUTNAM FUNDS
PCM DIVERSIFIED INCOME FUND
Seeks high current income consistent with capital preservation by investing
in the following three sectors of the fixed income securities markets: U.S.
Government Sector, High Yield Sector (which invests primarily in what are
commonly referred to as "junk bonds"), and International Sector. See the special
considerations for investments in high yield securities described in the Putnam
Fund prospectus.
PCM GLOBAL ASSET ALLOCATION FUND
Seeks a high level of long-term total return consistent with preservation of
capital by investing in U.S. equities, international equities, U.S. fixed income
securities, and international fixed income securities.
PCM GLOBAL GROWTH FUND
Seeks capital appreciation through a globally diversified common stock
portfolio.
PCM GROWTH AND INCOME FUND
Seeks capital growth and current income by investing primarily in common
stocks that offer potential for capital growth, current income, or both.
PCM HIGH YIELD FUND
Seeks high current income by investing primarily in high-yielding,
lower-rated fixed income securities (commonly referred to as "junk bonds"),
constituting a diversified portfolio which Putnam Investment Management, Inc.
("Putnam Management") believes does not involve undue risk to income or
principal. Capital growth is a secondary objective when consistent with seeking
high current income. See the special considerations for investments for high
yield securities described in the Putnam Fund prospectus.
24
<PAGE>
PCM MONEY MARKET FUND
Seeks to achieve as high a level of current income as Putnam Management
believes is consistent with preservation of capital and maintenance of liquidity
by investing in high-quality money market instruments.
PCM NEW OPPORTUNITIES FUND
Seeks long-term capital appreciation by investing principally in common
stocks of companies in sectors of the economy which Putnam Management believes
possess above average long-term growth potential.
PCM U.S. GOVERNMENT AND HIGH QUALITY BOND FUND
Seeks current income consistent with preservation of capital by investing
primarily in through investment in securities issued or guaranteed as to
principal and interest by the U.S. Government or by its agencies or
instrumentalities and in other debt obligations rated at least A by Standard &
Poor's or Moody's or, if not rated, determined by Putnam Management to be of
comparable quality.
PCM UTILITIES GROWTH AND INCOME FUND
Seeks capital growth and current income by concentrating its investments in
securities issued by companies in the public utilities industries.
PCM VOYAGER FUND
Aggressively seeks capital appreciation primarily from a portfolio of common
stocks of companies that Putnam Management believes have potential for capital
appreciation which is significantly greater than that of market averages.
FIDELITY FUNDS
EQUITY-INCOME PORTFOLIO
To seek reasonable income by investing primarily in income-producing equity
securities. In choosing these securities, the Portfolio will also consider the
potential for capital appreciation. The Portfolio's goal is to achieve a yield
which exceeds the composite yield on the securities comprising the Standard &
Poor's Daily Stock Price Index of 500 Common Stocks. The Portfolio may invest in
high yielding, lower-rated securities (commonly referred to as "junk bonds")
which are subject to greater risk than investments in higher-rated securities.
For a further discussion of lower-rated securities, please see "Risks of
Lower-Rated Debt Securities" in the Fidelity prospectus for this Portfolio.
OVERSEAS PORTFOLIO
To seek long-term growth of capital primarily through investments in foreign
securities and provide a means for aggressive investors to diversify their own
portfolios by participating in companies and economies outside of the United
States.
ASSET MANAGER PORTFOLIO
To seek high total return with reduced risk over the long-term by allocating
its assets among stocks, bonds and short-term fixed-income instruments.
The Hartford Funds are organized as corporations under the laws of the State
of Maryland and are registered as diversified open-end management companies
under the Investment Company Act of 1940. The Putnam Funds are portfolios of the
Putnam Capital Manager Trust, which is organized as a business trust under the
laws of Massachusetts as an open-end series investment company under the
Investment Company Act of 1940. The Fidelity Funds involve two diversified
open-end management investment companies, each with multiple portfolios and
organized as a Massachusetts business trust. The Equity-Income Portfolio and
Overseas Portfolio are portfolios of the Variable Insurance Products Fund. The
Asset Manager Portfolio is a portfolio of the Variable Insurance Products Fund
II.
25
<PAGE>
Each Fund continually issues an unlimited number of full and fractional
shares of beneficial interest in the Fund. Such shares are offered to separate
accounts, including Separate Account VL I, established by ITT Hartford or one of
its affiliated companies specifically to fund the Policy and other policies
issued by ITT Hartford or its affiliates as permitted by the Investment Company
Act of 1940.
It is conceivable that in the future it may be disadvantageous for variable
life insurance separate accounts and variable annuity separate accounts to
invest in the Funds simultaneously. Although neither ITT Hartford nor the Funds
currently foresee any such disadvantages either to variable life insurance
Policy Owners or to variable annuity Policy Owners, the Board of Directors
intend for the Hartford Funds and the Board of Trustees for the Putnam Funds and
the Fidelity Funds (collectively the "Board") to monitor events in order to
identify any material conflicts between such Policy Owners and to determine what
action, if any, should be taken in response thereto. If the Boards were to
conclude that separate funds should be established for variable life and
variable life insurance separate accounts, ITT Hartford will bear the attendant
expenses.
All investment income of and other distributions to each Sub-Account of
Separate Account VL I arising from the applicable Fund are reinvested in shares
of that Fund at net asset value. The income and both realized gains or losses on
the assets of each Sub-Account of Separate Account VL I are therefore separate
and are credited to or charged against the Sub-Account without regard to income,
gains or losses from any other Sub-Account or from any other business of ITT
Hartford. ITT Hartford will purchase shares in the Funds in connection with
premium payments allocated to the applicable Sub-Account in accordance with
Policy Owners' directions and will redeem shares in the Funds to meet Policy
obligations or make adjustments in reserves, if any. The Funds are required to
redeem Fund shares at net asset value and generally to make payment within seven
days.
ITT Hartford reserves the right, subject to compliance with the law as then
in effect, to make additions to, deletions from, or substitutions for Separate
Account VL I and its Sub-Accounts which fund the Policy. If shares of any of the
Funds should no longer be available for investment, or if, in the judgment of
ITT Hartford's management, further investment in shares of any Fund should
become inappropriate in view of the purposes of the Policy, ITT Hartford may
substitute shares of another Fund for shares already purchased, or to be
purchased in the future, under the Policy. No substitution of securities will
take place without notice to and consent of Policy Owners and without prior
approval of the Securities and Exchange Commission to the extent required by the
Investment Company Act of 1940. Subject to Policy Owner approval, if required,
ITT Hartford also reserves the right to end the registration under the
Investment Company Act of 1940 of Separate Account VL I or any other separate
accounts of which it is the depositor which may fund the Policy.
Each Fund is subject to certain investment restrictions which may not be
changed without the approval of a majority of the shareholders of the Fund. See
the accompanying prospectuses for each of the Funds.
INVESTMENT ADVISER
HARTFORD FUNDS
The investment adviser for each of the Hartford Funds is The Hartford
Investment Management Company ("HIMCO"), a wholly-owned subsidiary of Hartford
Life Insurance Company. HIMCO was organized under the laws of the State of
Connecticut in October of 1981.
HIMCO also serves as investment adviser to several other ITT Hartford
sponsored funds which are also registered with the Securities and Exchange
Commission. HIMCO is registered as an investment adviser under the Investment
Advisers Act of 1940. HIMCO provides investment advice and, in general,
supervises the management and investment program of Hartford Bond Fund, Inc.,
Hartford Index Fund, Inc., Hartford Mortgage Securities Fund, Inc., and HVA
Money Market Fund, Inc., pursuant to an Investment Advisory Agreement entered
into with each of these Funds for which HIMCO receives a fee. HIMCO also
supervises the investment programs of Hartford Advisers Fund, Inc., Hartford
Capital Appreciation Fund, Inc., Hartford Dividend and Growth Fund, Inc.,
Hartford International Opportunities Fund, Inc., and Hartford Stock Fund, Inc.
pursuant to an Investment Management Agreement for which HIMCO receives a fee.
In addition, with respect to these five Funds, HIMCO has a Sub-Investment
Advisory Agreement with Wellington Management Company ("Wellington Management")
to provide an investment program to HIMCO for utilization by HIMCO in rendering
services to these funds. Wellington Management is a professional investment
counseling firm which provides investment services to investment companies,
other institutions and individuals. Wellington Management is organized as a
private Massachusetts partnership and its predecessor organizations have
provided
26
<PAGE>
investment advisory services to investment companies since 1933 and to
investment counseling clients since 1960. See the accompanying prospectuses for
each of the Funds for a more complete description of HIMCO and Wellington
Management and their respective fees.
PUTNAM FUNDS
Putnam Management, One Post Office Square, Boston, Massachusetts, 02109,
serves as the investment manager for the Putnam Funds. An affiliate, the Putnam
Advisory Company, Inc. manages domestic and foreign institutional accounts and
mutual funds. Another affiliate, Putnam Fiduciary Trust Company, provides
investment advice to institutional clients under its banking and fiduciary
policies. Putnam Management and its affiliates are wholly-owned subsidiaries of
Marsh & McLennan Companies, Inc., a publicly owned holding company whose
principal businesses are international insurance brokerage and employee benefit
consulting.
FIDELITY FUNDS
The Fidelity Funds are managed by Fidelity Management & Research Company
("Fidelity Management"), whose principal business address is 82 Devonshire
Street, Boston, Massachusetts. Fidelity Management is one of America's largest
investment management organizations. It is composed of a number of different
companies, which provide a variety of financial services and products. Fidelity
Management is the original Fidelity company, founded in 1946. It provides a
number of mutual funds and other clients with investment research and portfolio
management services. Various Fidelity companies perform certain activities
required to operate Variable Insurance Products Fund and Variable Insurance
Products Fund II.
THE FIXED ACCOUNT
THAT PORTION OF THE POLICY RELATING TO THE FIXED ACCOUNT IS NOT REGISTERED
UNDER THE SECURITIES ACT OF 1933 ("1933 ACT") AND THE FIXED ACCOUNT IS NOT
REGISTERED AS AN INVESTMENT COMPANY UNDER THE INVESTMENT COMPANY ACT OF 1940
("1940 ACT"). ACCORDINGLY, NEITHER THE FIXED ACCOUNT NOR ANY INTERESTS THEREIN
ARE SUBJECT TO THE PROVISIONS OR RESTRICTIONS OF THE 1933 ACT OR THE 1940 ACT,
AND THE DISCLOSURE REGARDING THE FIXED ACCOUNT HAS NOT BEEN REVIEWED BY THE
STAFF OF THE SECURITIES AND EXCHANGE COMMISSION. THE FOLLOWING DISCLOSURE ABOUT
THE FIXED ACCOUNT MAY BE SUBJECT TO CERTAIN GENERALLY APPLICABLE PROVISIONS OF
THE FEDERAL SECURITIES LAWS REGARDING THE ACCURACY AND COMPLETENESS OF
DISCLOSURE.
Premium Payments and Account Values allocated to the Fixed Account become a
part of the general assets of ITT Hartford. ITT Hartford invests the assets of
the General Account in accordance with applicable law governing the investments
of insurance company general accounts.
The Fixed Account Minimum Credited Rate is shown in the Contract. Currently,
ITT Hartford guarantees that it will credit interest at a rate of not less than
4% per year, compounded annually, to amounts allocated to the Fixed Account
under the Policy. ITT Hartford may credit interest at a rate in excess of the
Fixed Account Minimum Credited Rate, however, ITT Hartford is not obligated to
credit any interest in excess of the Fixed Account Minimum Credited Rate. There
is no specific formula for the determination of excess interest credits. Some of
the factors that ITT Hartford may consider in determining whether to credit
excess interest to amounts allocated to the Fixed Account and the amount
thereof, are general economic trends, rates of return currently available and
anticipated on ITT Hartford's investments, regulatory and tax requirements and
competitive factors. ANY INTEREST CREDITED TO AMOUNTS ALLOCATED TO THE FIXED
ACCOUNT IN EXCESS OF THE FIXED ACCOUNT MINIMUM CREDITED RATE WILL BE DETERMINED
IN THE SOLE DISCRETION OF ITT HARTFORD. THE POLICY OWNER ASSUMES THE RISK THAT
INTEREST CREDITED TO FIXED ACCOUNT ALLOCATIONS MAY NOT EXCEED THE FIXED ACCOUNT
MINIMUM CREDITED RATE.
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<PAGE>
OTHER MATTERS
VOTING RIGHTS
In accordance with its view of presently applicable law, ITT Hartford will
vote the shares of the Funds at regular and special meetings of the shareholders
of the Funds in accordance with instructions from Policy Owners (or the assignee
of the Policy, as the case may be) having a voting interest in Separate Account
VL I. The number of shares held in the Separate Account which are allocable to
each Policy Owner is determined by dividing the Policy Owner's interest in each
Sub-Account by the net asset value of the applicable shares of the Funds. ITT
Hartford will vote shares for which no instructions have been given and shares
which are not allocable to Policy Owners (i.e., shares owned by ITT Hartford) in
the same proportion as it votes shares for which it has received instructions.
If the Investment Company Act of 1940 or any rule promulgated thereunder should
be amended, however, or if ITT Hartford's present interpretation should change
and, as a result, ITT Hartford determines it is permitted to vote the shares of
the Funds in its own right, it may elect to do so.
The voting interests of the Policy Owner (or the assignee) in the Funds will
be determined as follows: Policy Owners may cast one vote for each full or
fractional Accumulation Unit owned under the Policy and allocated to a
Sub-Account the assets of which are invested in the particular Fund on the
record date for the shareholder meeting for that Fund. If, however, a Policy
Owner has taken a loan secured by the Policy, amounts transferred from the
Sub-Account(s) to the Loan Account(s) in connection with the loan (see "Policy
Benefits and Rights -- Policy Loans," page 12) will not be considered in
determining the voting interests of the Policy Owner. Policy Owners should
review the prospectuses for the Funds which accompany this Prospectus to
determine matters on which shareholders may vote.
ITT Hartford may, when required by state insurance regulatory authorities,
disregard voting instructions if the instructions require that the shares be
voted so as to cause a change in the sub-classification or investment objective
of one or more of the Funds or to approve or disapprove an investment advisory
policy for the Funds. In addition, ITT Hartford itself may disregard voting
instructions in favor of changes initiated by a Policy Owner in the investment
policy or the investment adviser of the Funds if ITT Hartford reasonably
disapproves of such changes. A change would be disapproved only if the proposed
change is contrary to state law or prohibited by state regulatory authorities.
In the event ITT Hartford does disregard voting instructions, a summary of that
action and the reasons for such action will be included in the next periodic
report to Policy Owners.
STATEMENTS TO POLICY OWNERS
We will send You a statement at least once each Policy Year, showing:
1. the current Account Value, Cash Surrender Value and Face Amount;
2. the premium paid, Monthly Deduction Amounts and loans since the last
report;
3. the amount of any Indebtedness;
4. notifications required by the provisions of the Policy; and
5. any other information required by the Insurance Department of the State
where the Policy was delivered.
LIMIT ON RIGHT TO CONTEST
ITT Hartford may not contest the validity of the Policy after it has been in
effect during the lifetime of the Insured for two years from the Issue Date. If
the Policy is reinstated, the two-year period is measured from the date of
reinstatement. In addition, if the Insured commits suicide in the two-year
period, or such period as specified in state law, the benefit payable will be
limited to the premium paid less any Indebtedness and withdrawals.
MISSTATEMENT AS TO AGE
If the age of an Insured is incorrectly stated, the amount of Death Benefit
will be appropriately adjusted as specified in the Policy.
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<PAGE>
PAYMENT OPTIONS
Proceeds under the Policy may be paid in a lump sum or may be applied to one
of ITT Hartford's payment options. The minimum amount that may be placed under a
payment option is subject to the then current rules of ITT Hartford. Once
payments under Options 2, 3 or 4 commence, no surrender of the Policy may be
made for the purpose of receiving a lump sum settlement in lieu of the life
insurance payments. The following options are available under the Policy.
FIRST OPTION: Interest Income
Payments of interest at the rate We declare, but not less than 3 1/2% per
year, on the amount applied under this option.
SECOND OPTION: Income of Fixed Amount
Equal payments of the amount chosen until the amount applied under this
option, with interest of not less than 3 1/2% per year, is exhausted. The final
payment will be for the balance remaining.
THIRD OPTION: Payments for a Fixed Period
An amount payable monthly for the number of years selected which may be from
1 to 30 years.
FOURTH OPTION: Life Income
- LIFE ANNUITY -- an annuity payable monthly during the lifetime of the
annuitant and terminating with the last monthly payment due preceding the
death of the annuitant.
- LIFE ANNUITY WITH 120 MONTHLY PAYMENTS CERTAIN -- an annuity providing
monthly income to the annuitant for a fixed period of 120 months and for
as long thereafter as the annuitant shall live.
The Tables in the Policy provide for guaranteed dollar amounts of monthly
payments for each $1,000 applied under the four Payment Options. Under the
Fourth Option, the amount of each payment will depend upon the age of the
Annuitant at the time the first payment is due. If any periodic payment due any
payee is less than $200, ITT Hartford may make payments less often.
The Table for the Fourth Option is based on the 1983a Individual Annuity
Mortality Table set back one year and a net investment rate of 3.5% per annum.
The Tables for the First, Second and Third Options are based on a net investment
rate of 3.5% per annum. ITT Hartford may, however, from time to time, at Our
discretion if mortality appears more favorable and interest rates justify, apply
other tables which will result in higher monthly payments for each $1,000
applied under one or more of the four Payment Options.
ITT Hartford will make any other arrangements for income payments as may be
agreed on.
BENEFICIARY
The applicant names the Beneficiary in the application for the Policy. The
Policy Owner may change the Beneficiary (unless irrevocably named) during the
lifetime of the Insured by written request to ITT Hartford. If no Beneficiary is
living when the Insured dies, the Death Proceeds will be paid to the Policy
Owner if living; otherwise to the Policy Owner's estate.
ASSIGNMENT
The Policy may be assigned as collateral for a loan or other obligation. ITT
Hartford is not responsible for any payment made or action taken before receipt
of written notice of such assignment. Proof of interest must be filed with any
claim under a collateral assignment.
DIVIDENDS
No dividends will be paid under the Policy.
29
<PAGE>
SUPPLEMENTAL BENEFITS
The following supplemental benefits, which are subject to the restrictions
and limitations set forth therein, are among the options that may be included in
a Policy by rider. The Monthly Deduction Amount will be increased to include the
charges for any rider.
MATURITY DATE EXTENSION RIDER
We will extend the Scheduled Maturity Date (the date on which the Policy
will mature) to the date of the death of the Insured regardless of the age of
the Insured. Certain Death Benefit and premium restrictions apply. See "Income
Taxation of Policy Benefits."
TERM INSURANCE RIDER
We will pay an amount upon the death of a designated insured person other
than the Insured Person while this Policy remains in force.
DEDUCTION AMOUNT WAIVER RIDER
[To Be Provided By Amendment]
WAIVER OF SPECIFIED AMOUNT DISABILITY BENEFIT RIDER
If the Insured becomes totally disabled, We will credit the Policy with a
premium equal to the Specified Amount Disability Benefit for as long as the
Insured remains totally disabled, subject to certain qualifications and
restrictions.
ACCIDENTAL DEATH BENEFIT RIDER
Subject to certain age and underwriting requirements, the Policy may include
an Accidental Death Benefit Rider. This rider provides for an increase in the
amount paid upon the death of the Insured if the death results from an accident.
30
<PAGE>
EXECUTIVE OFFICERS AND DIRECTORS
<TABLE>
<CAPTION>
OTHER BUSINESS
PROFESSION, VOCATION
POSITION WITH ITT OR EMPLOYMENT FOR
HARTFORD, YEAR PAST 5 YEARS; OTHER
NAME, AGE OF ELECTION DIRECTORSHIPS
- -------------------------------- ----------------------------------- ------------------------------------------
<S> <C> <C>
Andrew, Joan M., 38 Vice President, 1992 Vice President and Director, National
Service Center Operations
(1992-Present), ITT Hartford.
Bossen, Wendell J., 62 Vice President, 1995** Vice President (1992), Hartford Life
Insurance Company; Executive Vice
President (1984), Mutual Benefit.
Gregory A. Boyko, 44 Vice President, 1995 Vice President and Controller
(1995-Present), Hartford Life Insurance
Company; Chief Financial Officer
(1994-1995), IMG American Life; Senior
Vice President (1992-1994), Connecticut
Mutual.
Cummins, Peter W., 59 Vice President, 1993 Vice President, Individual Annuity
Operations (1989-Present), Hartford Life
Insurance Company.
deRaismes, Ann M., 45 Vice President, 1994 Vice President (1994-Present), Assistant
Vice President (1992), Director of Human
Resources (1991-Present), Hartford Life
Insurance Company.
Dooley, James R., 59 Vice President, 1977 Vice President, Director Information
Services (1973-Present), ITT Hartford.
Fitch, Timothy M., 43 Vice President, 1995 Vice President (1995-Present); Assistant
Vice President (1993); Director (1991),
Hartford Life.
Frahm, Donald R., 64 Director, 1995* Chairman and Chief Executive Officer
(1988-Present), ITT Hartford Insurance
Group, Inc.
Gardner, Bruce D., 45 Director, 1991* Vice President (1996-Present) General
Counsel and Corporate Secretary (1991),
Hartford Life Insurance Company
Gareau, Joseph H., 49 Executive Vice President, 1993 Executive Vice President and Chief
Chief Investment Officer, 1993 Investment Officer (1993-Present),
Director, 1993* Hartford Life Insurance Company
Gillette, Donald J., 50 Vice President, 1993 Vice President, Director of Marketing
(1991-Present), ITT Hartford; MSI
Insurance (1986)
Godkin, Lynda, 42 General Counsel, 1996 Associate General Counsel and Corporate
Corporate Secretary, 1995 Secretary (1995-Present), Assistant
General Counsel and Secretary (1994),
Counsel (1990), Hartford Life Insurance
Company
</TABLE>
31
<PAGE>
<TABLE>
<CAPTION>
OTHER BUSINESS
PROFESSION, VOCATION
POSITION WITH ITT OR EMPLOYMENT FOR
HARTFORD, YEAR PAST 5 YEARS; OTHER
NAME, AGE OF ELECTION DIRECTORSHIPS
- -------------------------------- ----------------------------------- ------------------------------------------
<S> <C> <C>
Grady, Lois W., 51 Vice President, 1993 Vice President (1993-Present), Assistant
Vice President (1988), Hartford Life
Insurance Company
Hall, David A., 42 Senior Vice President, 1993 Senior Vice President and Actuary
Actuary, 1993 (1993-Present), Hartford Life Insurance
Company
Kanarek, Joseph, 48 Vice President, 1994 Vice President (1991-Present), Director
Director, 1994* (1992-Present), Hartford Life Insurance
Company
Robert A. Kerzner, 44 Vice President, 1994 Vice President (1994-Present), Regional
Vice President (1991), Life Sales
Manager (1990), Hartford Life Insurance
Company.
Kohlhof, LaVern L., 66 Vice President, 1980 Vice President and Secretary
Secretary, 1980 (1980-Present), ITT Hartford
Malchodi, Jr., William B., 45 Vice President, 1994 Vice President (1994-Present), Director of
Director of Taxes, 1992 Taxes (1992-Present), Assistant General
Counsel and Assistant Director of Taxes
(1986), Hartford Insurance Group
Marra, Thomas M., 37 Executive Vice President, 1995 Senior Vice President (1994), Director of
Director, 1994* Individual Annuities (1991), Vice
President (1989), Hartford Life
Insurance Company
Matthiesen, Steven L., 51 Vice President, 1984 Vice President, Director of New Business
(1984-Present), ITT Hartford
Joseph J. Noto, 44 Vice President, 1989 Vice President (1989-Present), Hartford
Life Insurance Company.
Raymond, Craig D., 32 Vice President, 1993 Vice President and Chief Actuary
Chief Actuary, 1994 (1994-Present), Vice President (1993),
Assistant Vice President (1992), Actuary
(1989-1994), Hartford Life Insurance
Company
Schrandt, David T., 48 Vice President, 1987 Treasurer, Vice President, Treasurer and Controller
1987 (1987-Present), ITT Hartford
Smith, Lowndes A., 55 President, 1993 Chief Executive President and Chief Executive Officer
Officer, 1993 Director, 1985* (1993-Present), ITT Hartford; President
and Chief Operating Officer
(1989-Present), Hartford Life Insurance
Company
Zlatkus, Lizabeth H., 36 Vice President, 1994 Vice President, Director Business
Director, 1994* Operations (1994), Assistant Vice
President, Director Executive Operations
(1992), Executive Staff Assistant to
President (1990), Hartford Life
Insurance Company
</TABLE>
- ------------------------
* Denotes year of election to Board of Directors
** ITT Hartford Affiliated Company
32
<PAGE>
DISTRIBUTION OF THE POLICY
ITT Hartford intends to sell the Policy in all jurisdictions where it is
licensed to do business. The Policy will be sold by life insurance sales
representatives who represent ITT Hartford and who are registered
representatives of Hartford Equity Sales Company, Inc. ("HESCO"), or certain
other independent registered Broker-Dealers. Any sales representative or
employee will be qualified to sell variable life insurance policies under
applicable federal and state laws. Each Broker-Dealer is registered with the
Securities and Exchange Commission under the Securities Exchange Act of 1934 and
all are members of the National Association of Securities Dealers, Inc. HESCO is
the principal underwriter for the Policy. During the first Policy Year, the
maximum sales commission payable to ITT Hartford agents, independent registered
insurance brokers, and other registered Broker-Dealers, is 45% of the premium
paid up to a Target Premium, 1.5% of premium paid between the Target Premium and
a 2nd Tier Target Premium and 1% of premium paid in excess of the 2nd Tier
Target Premium. For Policy Years 2 and later, either of two commission options
may be chosen. After the first Policy Year, sales representative commissions
will not exceed either: (1) 2.0% of the premiums paid, or (2) 1.5% of the
premium paid in Policy Year 2 and later plus 0.15% of the Account Value in
Policy Years 11 and later. In addition, expense allowances may be paid. The
sales representative may be required to return all or a portion of the
commissions paid if the Policy terminates prior to the second Policy
Anniversary.
SAFEKEEPING OF SEPARATE
ACCOUNT VL I'S ASSETS
The assets of the Separate Account are held by ITT Hartford. The assets of
the Separate Account are kept physically segregated and held separate and apart
from the General Account of ITT Hartford. ITT Hartford maintains records of all
purchases and redemptions of shares of the Fund. Additional protection for the
assets of the Separate Account is afforded by ITT Hartford's blanket fidelity
bond issued by Aetna Casualty and Surety Company, in the aggregate amount of $50
million, covering all of the officers and employees of ITT Hartford.
FEDERAL TAX CONSIDERATIONS
GENERAL
SINCE THE TAX LAW IS COMPLEX AND SINCE TAX CONSEQUENCES WILL VARY ACCORDING
TO THE ACTUAL STATUS OF THE CONTRACT OWNER INVOLVED, LEGAL AND TAX ADVICE MAY BE
NEEDED BY A PERSON, EMPLOYER OR OTHER ENTITY CONTEMPLATING THE PURCHASE OF A
CONTRACT DESCRIBED HEREIN.
It should be understood that any detailed description of the Federal income
tax consequences regarding the purchase of these Contracts cannot be made in
this Prospectus and that special tax rules may be applicable with respect to
certain purchase situations not discussed herein. In addition, no attempt is
made here to consider any applicable state or other tax laws. For detailed
information, a qualified tax adviser should always be consulted. This discussion
of Federal tax considerations is based upon ITT Hartford's understanding of
current Federal income tax laws as they are currently interpreted.
TAXATION OF ITT HARTFORD AND THE SEPARATE ACCOUNT
The Separate Account is taxed as a part of ITT Hartford which is taxed as a
life insurance company under Subchapter L of the Internal Revenue Code ("Code").
Accordingly, the Separate Account will not be taxed as a "regulated investment
company" under Subchapter M of the Code. Investment income and realized capital
gains on the assets of the Separate Account (the underlying Funds) are
reinvested and are taken into account in determining the value of the
Accumulation Units (see "Contract Benefits and Right -- Account Values," on page
10). As a result, such investment income and realized capital gains are
automatically applied to increase reserves under the Contract.
ITT Hartford does not expect to incur any Federal income tax on the earnings
or realized capital gains attributable to the Separate Account. Based upon this
expectation, no charge is currently being made to the
33
<PAGE>
Separate Account for Federal income taxes. If ITT Hartford incurs income taxes
attributable to the Separate Account or determines that such taxes will be
incurred, it may assess a charge for such taxes against the Separate Account.
INCOME TAXATION OF CONTRACT BENEFITS
For Federal income tax purposes, the Contracts should be treated as life
insurance contracts under Section 7702 of the Code. The death benefit under a
life insurance contract is generally excluded from the gross income of the
beneficiary. Also, a life insurance Contract Owner is generally not taxed on
increments in the contract value until the Contract is partially or completely
surrendered. Section 7702 limits the amount of premium that may be invested in a
Contract that is treated as life insurance. ITT Hartford intends to monitor
premium levels to assure compliance with the Section 7702 requirements.
During the first fifteen Contract Years, an "income first" rule generally
applies to distributions of cash required to be made under Code Section 7702
because of a reduction in benefits under the Contract.
The Maturity Date Extension Rider allows a Contract Owner to extend the
Maturity Date to the date of the Insured's death. If the Maturity Date of the
Contract is extended by rider, ITT Hartford believes that the Contract will
continue to be treated as a life insurance contract for federal income tax
purposes after the scheduled Maturity Date. However, due to the lack of specific
guidance on this issue, the result is not certain. If the Contract is not
treated as a life insurance contract for federal income tax purposes after the
scheduled Maturity Date, among other things, the Death Proceeds may be taxable
to the recipient. The Contract Owner should consult a qualified tax adviser
regarding the possible adverse tax consequences resulting from an extension of
the scheduled Maturity Date.
MODIFIED ENDOWMENT CONTRACTS
A life insurance contract is treated as a "modified endowment contract"
under Section 7702A of the Code if it meets the definition of life insurance in
Section 7702 but fails the "seven-pay" test of Section 7702A. The seven-pay test
provides that premium cannot be paid at a rate more rapidly than that allowed by
the payment of seven annual premiums using specified computational rules
provided in Section 7702A(c). The large single premium permitted under the
Contract does not meet the specified computational rules for the "seven-pay
test" under Section 7702A(c). Therefore, the Contract will generally be treated
as a modified endowment contract for federal income tax purposes. However, an
exchange under Section 1035 of the Code of a life insurance contract issued
before June 21, 1988 will not cause the new Contract to be treated as a modified
endowment contract if no additional premiums are paid and there is no change in
the death benefit as the result of the exchange.
A contract that is classified as modified endowment contract is generally
eligible for the beneficial tax treatment accorded to life insurance. That is,
the death benefit is excluded from income and increments in value are not
subject to current taxation. However, a loan, distributions or other amounts
received from a modified endowment contract during the life of the Insured will
be taxed to the extent of any accumulated income in the contract (generally, the
excess of account value over premiums paid). Amounts that are taxable
withdrawals will be subject to a 10% additional tax, with certain exceptions.
All modified endowment contracts that are issued within any calendar year to
the same Contract Owner by one company or its affiliates shall be treated as one
modified endowment contract in determining the taxable portion of any loan or
distributions.
ESTATE AND GENERATION SKIPPING TAXES
When the Insured dies, the Death Proceeds will generally be includible in
the Contract Owner's estate for purposes of federal estate tax if the last
surviving Insured owned the Contract. If the Contract Owner was not the last
surviving Insured, the fair market value of the Contract would be included in
the Contract Owner's estate upon the Contract Owner's death. Nothing would be
includible in the last surviving Insured's estate if he or she neither retained
incidents of ownership at death nor had given up ownership within three years
before death.
Federal estate tax is integrated with federal gift tax under a unified rate
schedule. In general, estates less than $600,000 will not incur a federal estate
tax liability. In addition, an unlimited marital deduction may be
34
<PAGE>
available for federal estate and gift tax purposes. The unlimited marital
deduction permits the deferral of taxes until the death of the surviving spouse
(when the Death Proceeds would be available to pay taxes due and other expenses
incurred).
If the Contract Owner (whether or not he or she is an Insured) transfers
ownership of the Contract to someone two or more generations younger, the
transfer may be subject to the generation-skipping transfer tax, the taxable
amount being the value of the Contract. The generation-skipping transfer tax
provisions generally apply to transfers which would be subject to the gift and
estate tax rules. Individuals are generally allowed an aggregate generation
skipping transfer exemption of $1 million. Because these rules are complex, the
Contract Owner should consult with a qualified tax adviser for specific
information if ownership is passing to younger generations.
DIVERSIFICATION REQUIREMENTS
Section 817 of the Code provides that a variable life insurance contract
(other than a pension plan policy) will not be treated as a life insurance
contract for any period during which the investments made by the separate
account or underlying fund are not adequately diversified in accordance with
regulations prescribed by the Treasury Department. If a Contract is not treated
as a life insurance contract, the Contract Owner will be subject to income tax
on the annual increases in cash value.
The Treasury Department has issued diversification regulations which
generally require, among other things, that no more than 55% of the value of the
total assets of the segregated asset account underlying a variable contract is
represented by any one investment, no more than 70% is represented by any two
investments, no more than 80% is represented by any three investments, and no
more than 90% is represented by any four investments. In determining whether the
diversification standards are met, all securities of the same issuer, all
interests in the same real property project, and all interests in the same
commodity are each treated as a single investment. In addition, in the case of
government securities, each government agency or instrumentality shall be
treated as a separate issuer.
A separate account must be in compliance with the diversification standards
on the last day of each calendar quarter or within 30 days after the quarter
ends. If an insurance company inadvertently fails to meet the diversification
requirements, the company may comply within a reasonable period and avoid the
taxation of policy income on an ongoing basis. However, either the company or
the Contract Owner must agree to pay the tax due for the period during which the
diversification requirements were not met.
ITT Hartford monitors the diversification of investments in the separate
accounts and tests for diversification as required by the Code. ITT Hartford
intends to administer all contracts subject to the diversification requirements
in a manner that will maintain adequate diversification.
OWNERSHIP OF THE ASSETS IN THE SEPARATE ACCOUNT
In order for a variable life insurance contract to qualify for tax deferral,
assets in the segregated asset accounts supporting the variable contract must be
considered to be owned by the insurance company and not by the variable contract
owner. The Internal Revenue Service ("IRS") has issued several rulings which
discuss investor control. The IRS has ruled that incidents of ownership by the
contract owner, such as the ability to select and control investments in a
separate account, will cause the contract owner to be treated as the owner of
the assets for tax purposes.
Further, in the explanation to the temporary Section 817 diversification
regulations, the Treasury Department noted that the temporary regulations "do
not provide guidance concerning the circumstances in which investor control of
the investments of a segregated asset account may cause the investor, rather
than the insurance company, to be treated as the owner of the assets in the
account." The explanation further indicates that "the temporary regulations
provide that in appropriate cases a segregated asset account may include
multiple sub-accounts, but do not specify the extent to which policyholders may
direct their investments to particular sub-accounts without being treated as the
owners of the underlying assets. Guidance on this and other issues will be
provided in regulations or revenue rulings under section 817(d), relating to the
definition of variable contract." The final regulations issued under Section 817
did not provide guidance regarding investor control, and as of the date of this
Prospectus, no other such guidance has been issued. Further, ITT Hartford does
not know if or in what form such guidance will be issued. In addition, although
regulations are generally issued with prospective effect, it is possible that
regulations may be issued with retroactive effect. Due to the lack of specific
guidance regarding the issue of investor control, there is necessarily some
uncertainty
35
<PAGE>
regarding whether a Contract Owner could be considered the owner of the assets
for tax purposes. ITT Hartford reserves the right to modify the contracts, as
necessary, to prevent Contract Owners from being considered the owners of the
assets in the separate accounts.
LIFE INSURANCE PURCHASED FOR USE IN SPLIT DOLLAR ARRANGEMENTS
On January 26, 1996, the IRS released a technical advice memorandum ("TAM")
on the taxability of life insurance policies used in certain split dollar
arrangements. A TAM, issued by the National Office of the IRS, provides advice
as to the internal revenue laws, regulations, and related statutes with respect
to a specific set of facts and a specific taxpayer. In the TAM, among other
things, the IRS concluded that an employee was subject to current taxation on
the excess of the cash surrender value of the policy over the premiums to be
returned to the employer. Purchasers of life insurance policies to be used in
split dollar arrangements are strongly advised to consult with a qualified tax
adviser to determine the tax treatment resulting from such an arrangement.
FEDERAL INCOME TAX WITHHOLDING
If any amounts are deemed to be current taxable income to the Contract
Owner, such amounts will be subject to federal income tax withholding and
reporting, pursuant to the Code.
NON-INDIVIDUAL OWNERSHIP OF CONTRACTS
Legislation has recently been proposed which would limit certain of the tax
advantages now afforded non-individual owners of life insurance contracts.
Prospective Contract Owners which are not individuals should consult a tax
adviser to determine the status of this proposed legislation and its potential
impact on the purchaser.
OTHER
Federal estate tax, state and local estate, inheritance and other tax
consequences of ownership, or receipt of Contract proceeds depend on the
circumstances of each Contract Owner or beneficiary. A tax adviser should be
consulted to determine the impact of these taxes.
LIFE INSURANCE PURCHASES BY NONRESIDENT ALIENS AND FOREIGN CORPORATIONS
The discussion above provides general information regarding U.S. federal
income tax consequences to life insurance purchasers that are U.S. citizens or
residents. Purchasers that are not U.S. citizens or residents will generally be
subject to U.S. federal income tax and withholding on taxable distributions from
life insurance policies at a 30% rate, unless a lower treaty rate applies. In
addition, purchasers may be subject to state and/or municipal taxes and taxes
that may be imposed by the purchaser's country of citizenship or residence.
Prospective purchasers are advised to consult with a qualified tax advisor
regarding U.S. state, and foreign taxation with respect to a life insurance
policy purchase.
LEGAL PROCEEDINGS
There are no pending material legal proceedings affecting the Policy,
Separate Account VL I or any of the Funds.
LEGAL MATTERS
Legal matters in connection with the issue and sale of the flexible premium
variable life insurance policies described in this Prospectus and the
organization of ITT Hartford, its authority to issue the Policy under
Connecticut law and the validity of the forms of the Policy under Connecticut
law and legal matters relating to the Federal securities and income tax laws
have been passed on by Lynda Godkin, General Counsel and Secretary of ITT
Hartford.
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<PAGE>
EXPERTS
The financial statements for ITT Hartford Life and Annuity Insurance Company
included in this Prospectus and Registration Statement have been audited by
Arthur Andersen LLP, independent public accountants, as indicated in their
report herein, and are included herein in reliance upon the authority of said
firm as experts in accounting and auditing in giving said report. Reference is
made to said report of ITT Hartford Life and Annuity Insurance Company (the
depositor), which includes an explanatory paragraph with respect to changing the
valuation method in determining aggregate reserves for future benefits. The
principal business address of Arthur Andersen LLP is One Financial Plaza,
Hartford, CT 06103.
The hypothetical Policy illustrations included in this Prospectus and
Registration Statement have been approved by Ken A. McCullum, FSA, and MAAA,
Director of Individual Life Product Development, and are included in reliance
upon his opinion as to their reasonableness.
REGISTRATION STATEMENT
A registration statement has been filed with the Securities and Exchange
Commission under the Securities Act of 1933 as amended. This Prospectus does not
contain all information set forth in the registration statement, its amendments
and exhibits, to all of which reference is made for further information
concerning Separate Account VL I, ITT Hartford, and the Policy.
37
<PAGE>
APPENDIX A
ILLUSTRATION OF DEATH BENEFITS,
ACCOUNT VALUES AND CASH SURRENDER VALUES
The tables in Appendix A illustrate the way in which a Policy operates. They
show how the death benefit and surrender value could vary over an extended
period of time assuming hypothetical gross rates of return equal to constant
after tax annual rates of 0%, 6% and 12%. The illustrations assume the
following: a male, preferred, age 55, and a female, preferred, age 50, with
$1,000,000 of Face Amount and a premium of $15,500.00 paid in all years; a male,
preferred, age 55, and a female, preferred, age 50, with $750,000 of Face Amount
and $250,000 of Face Amount and a premium of $7,500.00 paid in all years; a
male, preferred, age 65, and a female, preferred, age 65, with $1,000,000 of
Face Amount and a premium of $27,000.00 paid for in all years; and a male,
preferred, age 65, and a female, preferred, age 65 with $750,000 of Face Amount
and $250,000 of Supplemental Face Amount and a premium of $21,500.00 paid in all
years.
The death benefit and surrender value for a Policy would be different from
those shown if the rates of return averaged 0%, 6% and 12% over a period of
years, but also fluctuated above or below those averages for individual Policy
Years. They would also differ if any contract loan were made during the period
of time illustrated.
The tables reflect the deductions of current Policy charges and guaranteed
Policy charges for a single gross interest rate. The death benefits and
surrender values would change if the current Cost of Insurance charges change.
The amounts shown for the death benefit and surrender value as of the end of
each Policy Year take into account an average daily charge equal to an annual
charge of 0.70% of the average daily net assets of the Funds for investment
advisory and administrative services fees. The gross annual investment return
rates of 0%, 6% and 12% on the Fund's assets are equal to net annual investment
return rates (net of the 0.70% average daily charge) of -.70%, 5.30% and 11.30%,
respectively.
In addition, the death benefit and surrender value as of the end of each
Policy Year take into account the front-end sales load, federal tax charge,
premium tax charge, Cost of Insurance Charge, Monthly Administrative Fee, Issue
Charge, and Mortality and Expense Risk Charge. For purpose of the illustrations
in this Prospectus, the premium tax charge and federal tax charge is assumed to
be an average of 3.5%.
The hypothetical returns shown in the tables are without any tax charges
that may be allocable to the Separate Account in the future. In order to produce
after tax returns of 0%, 6%, and 12%, the Separate Account would have to earn a
sufficient amount in excess of 0% or 6% or 12% to cover any tax charges (see
"Deductions and Charges -- Charges Against the Separate Account -- Taxes," page
22).
The "Premium Paid Plus Interest" column of each table shows the amount which
would accumulate if the initial premium was invested to earn interest, after
taxes of 5% per year, compounded annually.
ITT Hartford will furnish upon request, a comparable illustration reflecting
the proposed insureds age, risk classification, Face Amount or initial premium
requested, and reflecting guaranteed Cost of Insurance rates. ITT Hartford will
also furnish an additional similar illustration reflecting current Cost of
Insurance rates which may be less than, but never greater than, the guaranteed
Cost of Insurance rates.
38
<PAGE>
ITT HARTFORD LIFE AND ANNUITY
INSURANCE COMPANY
FLEXIBLE PREMIUM VARIABLE LIFE INSURANCE
DEATH BENEFIT OPTION: LEVEL
$250,000 FACE AMOUNT
ISSUE AGE 45 MALE PREFERRED
$3,250 SCHEDULED PREMIUM
ASSUMING HYPOTHETICAL GROSS ANNUAL INVESTMENT RETURN OF 0% (-0.70% NET)
<TABLE>
<CAPTION>
CURRENT CHARGES* GUARANTEED CHARGES**
PREMIUMS ----------------------------------- -----------------------------------
END OF ACCUMULATED CASH CASH
CONTRACT AT 5% INTEREST ACCOUNT SURRENDER DEATH ACCOUNT SURRENDER DEATH
YEAR PER YEAR VALUE VALUE BENEFIT VALUE VALUE BENEFIT
--------- --------------- ---------- --------- ---------- ---------- --------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
1 3,413 1,880 0*** 250,000 1,880 0*** 250,000
2 6,996 3,849 849*** 250,000 3,849 849*** 250,000
3 10,758 5,724 2,724 250,000 5,724 2,724 250,000
4 14,708 7,498 4,498 250,000 7,498 4,498 250,000
5 18,856 9,247 6,247 250,000 9,168 6,168 250,000
6 23,212 10,887 8,159 250,000 10,724 7,996 250,000
7 27,785 12,433 9,978 250,000 12,153 9,698 250,000
8 32,586 13,878 11,695 250,000 13,442 11,259 250,000
9 37,628 15,212 13,302 250,000 14,575 12,665 250,000
10 42,922 16,429 14,792 250,000 15,539 13,901 250,000
11 48,481 17,807 16,445 250,000 16,399 15,037 250,000
12 54,317 19,172 18,082 250,000 17,062 15,972 250,000
13 60,446 20,385 19,568 250,000 17,518 16,701 250,000
14 66,880 21,431 20,886 250,000 17,745 17,200 250,000
15 73,637 22,292 22,020 250,000 17,716 17,443 250,000
16 80,731 22,949 22,949 250,000 17,401 17,401 250,000
17 88,180 23,379 23,379 250,000 16,766 16,766 250,000
18 96,002 23,548 23,548 250,000 15,761 15,761 250,000
19 104,214 23,422 23,422 250,000 14,331 14,331 250,000
20 112,838 22,967 22,967 250,000 12,421 12,421 250,000
25 162,869 15,832 15,832 250,000 -- --
35 308,218 -- -- 250,000 -- --
</TABLE>
<TABLE>
<C> <S>
* THESE VALUES REFLECT INVESTMENT RESULTS USING CURRENT COST OF INSURANCE
RATES, ADMINISTRATIVE FEES, AND MORTALITY AND EXPENSE RISK RATES.
** THESE VALUES REFLECT INVESTMENT RESULTS USING GUARANTEED COST OF INSURANCE
RATES, ADMINISTRATIVE FEES, AND MORTALITY AND EXPENSE RISK RATES.
*** IF YOU SURRENDER YOUR POLICY DURING THE FIRST TWO POLICY YEARS, YOU WILL
RECEIVE A REFUND IN ADDITION TO THE CASH VALUES SHOWN. THE REFUND PLUS THE
CASH VALUE WOULD BE $0 IN YEAR ONE AND $1,182 IN YEAR TWO.
</TABLE>
THESE VALUES REFLECT CURRENT FRONT-END SALES LOADS OF 2% IN YEARS 1 THROUGH 10
AND 0% THEREAFTER, AND GUARANTEED FRONT-END SALES LOADS OF 2% IN ALL YEARS.
THE SURRENDER CHARGE EFFECTIVE IN ANY YEAR CAN BE DETERMINED BY SUBTRACTING THE
CASH SURRENDER VALUE FROM THE ACCOUNT VALUE.
THE DEATH BENEFIT MAY, AND THE ACCOUNT VALUES AND CASH VALUES WILL DIFFER IF
PREMIUMS ARE PAID IN DIFFERENT AMOUNTS OR FREQUENCIES.
THE HYPOTHETICAL INVESTMENT RESULTS SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE INVESTMENT RESULTS. ACTUAL INVESTMENT RESULTS MAY BE MORE OR LESS
THAN THOSE SHOWN. THE DEATH BENEFIT, ACCOUNT VALUE AND CASH SURRENDER VALUE FOR
A POLICY WOULD BE DIFFERENT FROM THOSE SHOWN IF ACTUAL INVESTMENT RETURN
APPLICABLE TO THE POLICY AVERAGE 0% OVER A PERIOD OF YEARS, BUT ALSO FLUCTUATED
ABOVE OR BELOW THAT AVERAGE FOR INDIVIDUAL POLICY YEARS. THE DEATH BENEFIT,
ACCOUNT VALUE AND CASH SURRENDER VALUE FOR A POLICY WOULD ALSO BE DIFFERENT FROM
THOSE SHOWN, DEPENDING ON THE INVESTMENT ALLOCATIONS MADE TO THE SEPARATE
ACCOUNTS AND THE RATES OF RETURN OF THE SEPARATE ACCOUNT IF THE ACTUAL RATES OF
INVESTMENT RETURN APPLICABLE TO THE POLICY AVERAGED 0%, BUT VARIED ABOVE OR
BELOW THAT AVERAGE FOR THE SEPARATE ACCOUNT. NO REPRESENTATION CAN BE MADE THAT
THIS HYPOTHETICAL RATE OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR SUSTAINED
OVER ANY PERIOD OF TIME.
39
<PAGE>
ITT HARTFORD LIFE AND ANNUITY
INSURANCE COMPANY
FLEXIBLE PREMIUM VARIABLE LIFE INSURANCE
DEATH BENEFIT OPTION: LEVEL
$250,000 FACE AMOUNT
ISSUE AGE 45 MALE PREFERRED
$3,250 SCHEDULED PREMIUM
ASSUMING HYPOTHETICAL GROSS ANNUAL INVESTMENT RETURN OF 6% (5.30% NET)
<TABLE>
<CAPTION>
CURRENT CHARGES* GUARANTEED CHARGES**
PREMIUMS -------------------------------- --------------------------------
END OF ACCUMULATED CASH CASH
CONTRACT AT 5% INTEREST ACCOUNT SURRENDER DEATH ACCOUNT SURRENDER DEATH
YEAR PER YEAR VALUE VALUE BENEFIT VALUE VALUE BENEFIT
--------- --------------- --------- -------- --------- --------- -------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
1 3,413 2,026 0*** 250,000 2,026 0*** 250,000
2 6,996 4,264 1,264*** 250,000 4,264 1,264*** 250,000
3 10,758 6,536 3,536 250,000 6,536 3,536 250,000
4 14,708 8,838 5,838 250,000 8,838 5,838 250,000
5 18,856 11,245 8,245 250,000 11,164 8,164 250,000
6 23,212 13,678 10,951 250,000 13,506 10,779 250,000
7 27,785 16,154 13,699 250,000 15,853 13,398 250,000
8 32,586 18,666 16,484 250,000 18,189 16,006 250,000
9 37,628 21,207 19,297 250,000 20,499 18,589 250,000
10 42,922 23,772 22,134 250,000 22,767 21,130 250,000
11 48,481 26,694 25,331 250,000 25,086 23,724 250,000
12 54,317 29,775 28,685 250,000 27,344 26,254 250,000
13 60,446 32,887 32,070 250,000 29,529 28,711 250,000
14 66,880 36,021 35,476 250,000 31,619 31,074 250,000
15 73,637 39,162 38,890 250,000 33,585 33,313 250,000
16 80,731 42,297 42,297 250,000 35,397 35,397 250,000
17 88,180 45,410 45,410 250,000 37,019 37,019 250,000
18 96,002 48,472 48,472 250,000 38,397 38,397 250,000
19 104,214 51,459 51,459 250,000 39,475 39,475 250,000
20 112,838 54,342 54,342 250,000 40,193 40,193 250,000
25 162,869 67,602 67,602 250,000 35,923 35,923 250,000
35 308,218 56,159 56,159 250,000 -- -- --
</TABLE>
<TABLE>
<C> <S>
* THESE VALUES REFLECT INVESTMENT RESULTS USING CURRENT COST OF INSURANCE
RATES, ADMINISTRATIVE FEES, AND MORTALITY AND EXPENSE RISK RATES.
** THESE VALUES REFLECT INVESTMENT RESULTS USING GUARANTEED COST OF INSURANCE
RATES, ADMINISTRATIVE FEES, AND MORTALITY AND EXPENSE RISK RATES.
*** IF YOU SURRENDER YOUR POLICY DURING THE FIRST TWO POLICY YEARS, YOU WILL
RECEIVE A REFUND IN ADDITION TO THE CASH VALUES SHOWN. THE REFUND PLUS THE
CASH VALUE WOULD BE $0 IN YEAR ONE AND $1,597 IN YEAR TWO.
</TABLE>
THESE VALUES REFLECT CURRENT FRONT-END SALES LOADS OF 2% IN YEARS 1 THROUGH 10
AND 0% THEREAFTER, AND GUARANTEED FRONT-END SALES LOADS OF 2% IN ALL YEARS.
THE SURRENDER CHARGE EFFECTIVE IN ANY YEAR CAN BE DETERMINED BY SUBTRACTING THE
CASH SURRENDER VALUE FROM THE ACCOUNT VALUE.
THE DEATH BENEFIT MAY, AND THE ACCOUNT VALUES AND CASH VALUES WILL DIFFER IF
PREMIUMS ARE PAID IN DIFFERENT AMOUNTS OR FREQUENCIES.
THE HYPOTHETICAL INVESTMENT RESULTS SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE INVESTMENT RESULTS. ACTUAL INVESTMENT RESULTS MAY BE MORE OR LESS
THAN THOSE SHOWN. THE DEATH BENEFIT, ACCOUNT VALUE AND CASH SURRENDER VALUE FOR
A POLICY WOULD BE DIFFERENT FROM THOSE SHOWN IF ACTUAL INVESTMENT RETURN
APPLICABLE TO THE POLICY AVERAGE 6% OVER A PERIOD OF YEARS, BUT ALSO FLUCTUATED
ABOVE OR BELOW THAT AVERAGE FOR INDIVIDUAL POLICY YEARS. THE DEATH BENEFIT,
ACCOUNT VALUE AND CASH SURRENDER VALUE FOR A POLICY WOULD ALSO BE DIFFERENT FROM
THOSE SHOWN, DEPENDING ON THE INVESTMENT ALLOCATIONS MADE TO THE SEPARATE
ACCOUNTS AND THE RATES OF RETURN OF THE SEPARATE ACCOUNT IF THE ACTUAL RATES OF
INVESTMENT RETURN APPLICABLE TO THE POLICY AVERAGED 6%, BUT VARIED ABOVE OR
BELOW THAT AVERAGE FOR THE SEPARATE ACCOUNT. NO REPRESENTATION CAN BE MADE THAT
THIS HYPOTHETICAL RATE OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR SUSTAINED
OVER ANY PERIOD OF TIME.
40
<PAGE>
ITT HARTFORD LIFE AND ANNUITY
INSURANCE COMPANY
FLEXIBLE PREMIUM VARIABLE LIFE INSURANCE
DEATH BENEFIT OPTION: LEVEL
$250,000 FACE AMOUNT
ISSUE AGE 45 MALE PREFERRED
$3,250 SCHEDULED PREMIUM
ASSUMING HYPOTHETICAL GROSS ANNUAL INVESTMENT RETURN OF 12% (11.30% NET)
<TABLE>
<CAPTION>
CURRENT CHARGES* GUARANTEED CHARGES**
PREMIUMS ------------------------------ ------------------------------
END OF ACCUMULATED CASH CASH
CONTRACT AT 5% INTEREST ACCOUNT SURRENDER DEATH ACCOUNT SURRENDER DEATH
YEAR PER YEAR VALUE VALUE BENEFIT VALUE VALUE BENEFIT
--------- --------------- -------- ------- --------- -------- ------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
1 3,413 2,173 0*** 250,000 2,173 0*** 250,000
2 6,996 4,698 1,698*** 250,000 4,698 1,698*** 250,000
3 10,758 7,420 4,420 250,000 7,420 4,420 250,000
4 14,708 10,354 7,354 250,000 10,354 7,354 250,000
5 18,856 13,600 10,600 250,000 13,517 10,517 250,000
6 23,212 17,105 14,377 250,000 16,925 14,197 250,000
7 27,785 20,915 18,460 250,000 20,952 18,137 250,000
8 32,586 25,055 22,873 250,000 24,535 22,353 250,000
9 37,628 29,554 27,644 250,000 28,770 26,860 250,000
10 42,922 34,447 32,809 250,000 33,319 31,681 250,000
11 48,481 40,191 38,828 250,000 38,355 36,992 250,000
12 54,317 46,601 45,511 250,000 43,793 42,703 250,000
13 60,446 53,629 52,811 250,000 49,680 48,862 250,000
14 66,880 61,341 60,796 250,000 56,058 55,513 250,000
15 73,637 69,814 69,541 250,000 62,976 62,704 250,000
16 80,731 79,136 79,136 250,000 70,490 70,490 250,000
17 88,180 89,410 89,410 250,000 78,668 78,668 250,000
18 96,002 100,750 100,750 250,000 87,577 87,577 250,000
19 104,214 113,291 113,291 250,000 97,304 97,304 250,000
20 112,838 127,198 127,198 250,000 107,961 107,961 250,000
25 162,869 226,444 226,444 250,000 181,353 181,353 250,000
35 308,218 681,239 681,239 250,000 531,802 531,802 250,000
</TABLE>
<TABLE>
<C> <S>
* THESE VALUES REFLECT INVESTMENT RESULTS USING CURRENT COST OF INSURANCE
RATES, ADMINISTRATIVE FEES, AND MORTALITY AND EXPENSE RISK RATES.
** THESE VALUES REFLECT INVESTMENT RESULTS USING GUARANTEED COST OF INSURANCE
RATES, ADMINISTRATIVE FEES, AND MORTALITY AND EXPENSE RISK RATES.
*** IF YOU SURRENDER YOUR POLICY DURING THE FIRST TWO POLICY YEARS, YOU WILL
RECEIVE A REFUND IN ADDITION TO THE CASH VALUES SHOWN. THE REFUND PLUS THE
CASH VALUE WOULD BE $0 IN YEAR ONE AND $2,031 IN YEAR TWO.
</TABLE>
THESE VALUES REFLECT CURRENT FRONT-END SALES LOADS OF 2% IN YEARS 1 THROUGH 10
AND 0% THEREAFTER, AND GUARANTEED FRONT-END SALES LOADS OF 2% IN ALL YEARS.
THE SURRENDER CHARGE EFFECTIVE IN ANY YEAR CAN BE DETERMINED BY SUBTRACTING THE
CASH SURRENDER VALUE FROM THE ACCOUNT VALUE.
THE DEATH BENEFIT MAY, AND THE ACCOUNT VALUES AND CASH VALUES WILL DIFFER IF
PREMIUMS ARE PAID IN DIFFERENT AMOUNTS OR FREQUENCIES.
THE HYPOTHETICAL INVESTMENT RESULTS SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE INVESTMENT RESULTS. ACTUAL INVESTMENT RESULTS MAY BE MORE OR LESS
THAN THOSE SHOWN. THE DEATH BENEFIT, ACCOUNT VALUE AND CASH SURRENDER VALUE FOR
A POLICY WOULD BE DIFFERENT FROM THOSE SHOWN IF ACTUAL INVESTMENT RETURN
APPLICABLE TO THE POLICY AVERAGE 12% OVER A PERIOD OF YEARS, BUT ALSO FLUCTUATED
ABOVE OR BELOW THAT AVERAGE FOR INDIVIDUAL POLICY YEARS. THE DEATH BENEFIT,
ACCOUNT VALUE AND CASH SURRENDER VALUE FOR A POLICY WOULD ALSO BE DIFFERENT FROM
THOSE SHOWN, DEPENDING ON THE INVESTMENT ALLOCATIONS MADE TO THE SEPARATE
ACCOUNTS AND THE RATES OF RETURN OF THE SEPARATE ACCOUNT IF THE ACTUAL RATES OF
INVESTMENT RETURN APPLICABLE TO THE POLICY AVERAGED 12%, BUT VARIED ABOVE OR
BELOW THAT AVERAGE FOR THE SEPARATE ACCOUNT. NO REPRESENTATION CAN BE MADE THAT
THIS HYPOTHETICAL RATE OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR SUSTAINED
OVER ANY PERIOD OF TIME.
41
<PAGE>
ITT HARTFORD LIFE AND ANNUITY
INSURANCE COMPANY
FLEXIBLE PREMIUM VARIABLE LIFE INSURANCE
DEATH BENEFIT OPTION: LEVEL
$250,000 FACE AMOUNT
ISSUE AGE 45 MALE PREFERRED
$3,250 SCHEDULED PREMIUM
ASSUMING HYPOTHETICAL GROSS ANNUAL INVESTMENT RETURN OF 0% (-0.70% NET)
<TABLE>
<CAPTION>
CURRENT CHARGES* GUARANTEED CHARGES**
PREMIUMS ----------------------------------- -----------------------------------
END OF ACCUMULATED CASH CASH
CONTRACT AT 5% INTEREST ACCOUNT SURRENDER DEATH ACCOUNT SURRENDER DEATH
YEAR PER YEAR VALUE VALUE BENEFIT VALUE VALUE BENEFIT
--------- --------------- ---------- --------- ---------- ---------- --------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
1 3,413 1,872 0*** 251,872 1,872 0*** 251,872
2 6,996 3,824 824*** 253,824 3,824 824*** 253,824
3 10,758 5,674 2,674 255,674 5,674 2,674 255,674
4 14,708 7,414 4,414 257,414 7,414 4,414 257,414
5 18,856 9,120 6,120 259,120 9,038 6,038 259,038
6 23,212 10,707 7,979 260,707 10,537 7,809 260,537
7 27,785 12,189 9,734 262,189 11,896 9,441 261,896
8 32,586 13,557 11,375 263,557 13,101 10,919 263,101
9 37,628 14,802 12,892 264,802 14,135 12,225 264,135
10 42,922 15,916 14,278 265,916 14,982 13,344 264,982
11 48,481 17,176 15,813 267,176 15,705 14,343 265,705
12 54,317 18,414 17,324 268,414 16,211 15,121 266,211
13 60,446 19,480 18,662 269,480 16,490 15,673 266,490
14 66,880 20,355 19,810 270,355 16,520 15,975 266,520
15 73,637 21,020 20,748 271,020 16,273 16,000 266,273
16 80,731 21,454 21,454 271,454 15,721 15,721 265,721
17 88,180 21,634 21,634 271,634 14,833 14,833 264,833
18 96,002 21,523 21,523 271,523 13,561 13,561 263,561
19 104,214 21,085 21,085 271,085 11,856 11,856 261,856
20 112,838 20,290 20,290 270,290 9,675 9,675 259,675
25 162,869 11,274 11,274 261,274 -- -- --
35 308,218 -- -- -- -- -- --
</TABLE>
<TABLE>
<C> <S>
* THESE VALUES REFLECT INVESTMENT RESULTS USING CURRENT COST OF INSURANCE
RATES, ADMINISTRATIVE FEES, AND MORTALITY AND EXPENSE RISK RATES.
** THESE VALUES REFLECT INVESTMENT RESULTS USING GUARANTEED COST OF INSURANCE
RATES, ADMINISTRATIVE FEES, AND MORTALITY AND EXPENSE RISK RATES.
*** IF YOU SURRENDER YOUR POLICY DURING THE FIRST TWO POLICY YEARS, YOU WILL
RECEIVE A REFUND IN ADDITION TO THE CASH VALUES SHOWN. THE REFUND PLUS THE
CASH VALUE WOULD BE $0 IN YEAR ONE AND $1,157 IN YEAR TWO.
</TABLE>
THESE VALUES REFLECT CURRENT FRONT-END SALES LOADS OF 2% IN YEARS 1 THROUGH 10
AND 0% THEREAFTER, AND GUARANTEED FRONT-END SALES LOADS OF 2% IN ALL YEARS.
THE SURRENDER CHARGE EFFECTIVE IN ANY YEAR CAN BE DETERMINED BY SUBTRACTING THE
CASH SURRENDER VALUE FROM THE ACCOUNT VALUE.
THE DEATH BENEFIT MAY, AND THE ACCOUNT VALUES AND CASH VALUES WILL DIFFER IF
PREMIUMS ARE PAID IN DIFFERENT AMOUNTS OR FREQUENCIES.
THE HYPOTHETICAL INVESTMENT RESULTS SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE INVESTMENT RESULTS. ACTUAL INVESTMENT RESULTS MAY BE MORE OR LESS
THAN THOSE SHOWN. THE DEATH BENEFIT, ACCOUNT VALUE AND CASH SURRENDER VALUE FOR
A POLICY WOULD BE DIFFERENT FROM THOSE SHOWN IF ACTUAL INVESTMENT RETURN
APPLICABLE TO THE POLICY AVERAGE 0% OVER A PERIOD OF YEARS, BUT ALSO FLUCTUATED
ABOVE OR BELOW THAT AVERAGE FOR INDIVIDUAL POLICY YEARS. THE DEATH BENEFIT,
ACCOUNT VALUE AND CASH SURRENDER VALUE FOR A POLICY WOULD ALSO BE DIFFERENT FROM
THOSE SHOWN, DEPENDING ON THE INVESTMENT ALLOCATIONS MADE TO THE SEPARATE
ACCOUNTS AND THE RATES OF RETURN OF THE SEPARATE ACCOUNT IF THE ACTUAL RATES OF
INVESTMENT RETURN APPLICABLE TO THE POLICY AVERAGED 0%, BUT VARIED ABOVE OR
BELOW THAT AVERAGE FOR THE SEPARATE ACCOUNT. NO REPRESENTATION CAN BE MADE THAT
THIS HYPOTHETICAL RATE OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR SUSTAINED
OVER ANY PERIOD OF TIME.
42
<PAGE>
ITT HARTFORD LIFE AND ANNUITY
INSURANCE COMPANY
FLEXIBLE PREMIUM VARIABLE LIFE INSURANCE
DEATH BENEFIT OPTION: LEVEL
$250,000 FACE AMOUNT
ISSUE AGE 45 MALE PREFERRED
$3,250 SCHEDULED PREMIUM
ASSUMING HYPOTHETICAL GROSS ANNUAL INVESTMENT RETURN OF 6% (5.30% NET)
<TABLE>
<CAPTION>
CURRENT CHARGES* GUARANTEED CHARGES**
PREMIUMS ----------------------------------- -----------------------------------
END OF ACCUMULATED CASH CASH
CONTRACT AT 5% INTEREST ACCOUNT SURRENDER DEATH ACCOUNT SURRENDER DEATH
YEAR PER YEAR VALUE VALUE BENEFIT VALUE VALUE BENEFIT
--------- --------------- ---------- --------- ---------- ---------- --------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
1 3,413 2,017 0*** 252,017 2,017 0*** 252,017
2 6,996 4,237 1,237*** 254,237 4,237 1,237*** 254,237
3 10,758 6,479 3,479 256,479 6,479 3,479 256,479
4 14,708 8,736 5,736 258,736 8,736 5,736 258,736
5 18,856 11,087 8,087 261,087 11,002 8,002 261,002
6 23,212 13,444 10,717 263,444 13,264 10,537 263,264
7 27,785 15,824 13,369 265,824 15,506 13,051 265,506
8 32,586 18,215 16,032 268,215 17,710 15,528 267,710
9 37,628 20,606 18,696 270,606 19,854 17,944 269,854
10 42,922 22,988 21,351 272,988 21,916 20,279 271,916
11 48,481 25,690 24,327 275,690 23,980 22,617 273,980
12 54,317 28,518 27,428 278,518 25,926 24,836 275,926
13 60,446 31,321 30,504 281,321 27,737 26,919 277,737
14 66,880 34,080 33,535 284,080 29,380 28,835 279,380
15 73,637 36,770 36,498 286,770 30,817 30,545 280,817
16 80,731 39,363 39,363 289,363 32,005 32,005 282,005
17 88,180 41,828 41,828 291,828 32,895 32,895 282,895
18 96,002 44,119 44,119 294,119 33,420 33,420 283,420
19 104,214 46,188 46,188 296,188 33,509 33,509 283,509
20 112,838 47,986 47,986 297,986 33,088 33,088 283,088
25 162,869 52,781 52,781 302,781 20,679 20,679 270,679
35 308,218 -- -- -- -- --
</TABLE>
<TABLE>
<C> <S>
* THESE VALUES REFLECT INVESTMENT RESULTS USING CURRENT COST OF INSURANCE
RATES, ADMINISTRATIVE FEES, AND MORTALITY AND EXPENSE RISK RATES.
** THESE VALUES REFLECT INVESTMENT RESULTS USING GUARANTEED COST OF INSURANCE
RATES, ADMINISTRATIVE FEES, AND MORTALITY AND EXPENSE RISK RATES.
*** IF YOU SURRENDER YOUR POLICY DURING THE FIRST TWO POLICY YEARS, YOU WILL
RECEIVE A REFUND IN ADDITION TO THE CASH VALUES SHOWN. THE REFUND PLUS THE
CASH VALUE WOULD BE $0 IN YEAR ONE AND $1,570 IN YEAR TWO.
</TABLE>
THESE VALUES REFLECT CURRENT FRONT-END SALES LOADS OF 2% IN YEARS 1 THROUGH 10
AND 0% THEREAFTER, AND GUARANTEED FRONT-END SALES LOADS OF 2% IN ALL YEARS.
THE SURRENDER CHARGE EFFECTIVE IN ANY YEAR CAN BE DETERMINED BY SUBTRACTING THE
CASH SURRENDER VALUE FROM THE ACCOUNT VALUE.
THE DEATH BENEFIT MAY, AND THE ACCOUNT VALUES AND CASH VALUES WILL DIFFER IF
PREMIUMS ARE PAID IN DIFFERENT AMOUNTS OR FREQUENCIES.
THE HYPOTHETICAL INVESTMENT RESULTS SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE INVESTMENT RESULTS. ACTUAL INVESTMENT RESULTS MAY BE MORE OR LESS
THAN THOSE SHOWN. THE DEATH BENEFIT, ACCOUNT VALUE AND CASH SURRENDER VALUE FOR
A POLICY WOULD BE DIFFERENT FROM THOSE SHOWN IF ACTUAL INVESTMENT RETURN
APPLICABLE TO THE POLICY AVERAGE 6% OVER A PERIOD OF YEARS, BUT ALSO FLUCTUATED
ABOVE OR BELOW THAT AVERAGE FOR INDIVIDUAL POLICY YEARS. THE DEATH BENEFIT,
ACCOUNT VALUE AND CASH SURRENDER VALUE FOR A POLICY WOULD ALSO BE DIFFERENT FROM
THOSE SHOWN, DEPENDING ON THE INVESTMENT ALLOCATIONS MADE TO THE SEPARATE
ACCOUNTS AND THE RATES OF RETURN OF THE SEPARATE ACCOUNT IF THE ACTUAL RATES OF
INVESTMENT RETURN APPLICABLE TO THE POLICY AVERAGED 6%, BUT VARIED ABOVE OR
BELOW THAT AVERAGE FOR THE SEPARATE ACCOUNT. NO REPRESENTATION CAN BE MADE THAT
THIS HYPOTHETICAL RATE OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR SUSTAINED
OVER ANY PERIOD OF TIME.
43
<PAGE>
ITT HARTFORD LIFE AND ANNUITY
INSURANCE COMPANY
FLEXIBLE PREMIUM VARIABLE LIFE INSURANCE
DEATH BENEFIT OPTION: LEVEL
$250,000 FACE AMOUNT
ISSUE AGE 45 MALE PREFERRED
$3,250 SCHEDULED PREMIUM
ASSUMING HYPOTHETICAL GROSS ANNUAL INVESTMENT RETURN OF 12% (11.30% NET)
<TABLE>
<CAPTION>
CURRENT CHARGES* GUARANTEED CHARGES**
PREMIUMS -------------------------------- --------------------------------
END OF ACCUMULATED CASH CASH
CONTRACT AT 5% INTEREST ACCOUNT SURRENDER DEATH ACCOUNT SURRENDER DEATH
YEAR PER YEAR VALUE VALUE BENEFIT VALUE VALUE BENEFIT
--------- --------------- --------- -------- --------- --------- -------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
1 3,413 2,163 0*** 252,163 2,163 0*** 252,163
2 6,996 4,668 1,668*** 254,668 4,668 1,668*** 254,668
3 10,758 7,354 4,354 257,354 7,354 4,354 257,354
4 14,708 10,233 7,233 260,233 10,233 7,233 260,233
5 18,856 13,404 10,404 263,404 13,316 10,316 263,316
6 23,212 16,804 14,076 266,804 16,613 13,885 266,613
7 27,785 20,472 18,017 270,472 20,128 17,673 270,128
8 32,586 24,425 22,242 274,425 23,866 21,684 273,866
9 37,628 28,679 26,769 278,679 27,831 25,921 277,831
10 42,922 33,258 31,620 283,258 32,026 30,389 282,026
11 48,481 38,601 37,238 288,601 36,600 35,237 286,600
12 54,317 44,523 43,433 294,523 41,442 40,352 291,442
13 60,446 50,925 50,108 300,925 46,570 45,753 296,570
14 66,880 57,842 57,297 307,842 51,987 51,442 301,987
15 73,637 65,307 65,035 315,307 57,692 57,420 307,692
16 80,731 73,355 73,355 323,355 63,683 63,683 313,683
17 88,180 82,024 82,024 332,024 69,952 69,952 319,952
18 96,002 91,340 91,340 341,340 76,475 76,475 326,475
19 104,214 101,336 101,336 351,336 83,222 83,222 333,222
20 112,838 112,046 112,046 362,046 90,166 90,166 340,166
25 162,869 179,944 179,944 429,944 126,697 126,697 376,697
35 308,218 396,129 396,129 646,129 163,485 163,485 413,485
</TABLE>
<TABLE>
<C> <S>
* THESE VALUES REFLECT INVESTMENT RESULTS USING CURRENT COST OF INSURANCE
RATES, ADMINISTRATIVE FEES, AND MORTALITY AND EXPENSE RISK RATES.
** THESE VALUES REFLECT INVESTMENT RESULTS USING GUARANTEED COST OF INSURANCE
RATES, ADMINISTRATIVE FEES, AND MORTALITY AND EXPENSE RISK RATES.
*** IF YOU SURRENDER YOUR POLICY DURING THE FIRST TWO POLICY YEARS, YOU WILL
RECEIVE A REFUND IN ADDITION TO THE CASH VALUES SHOWN. THE REFUND PLUS THE
CASH VALUE WOULD BE $0 IN YEAR ONE AND $2,001 IN YEAR TWO.
</TABLE>
THESE VALUES REFLECT CURRENT FRONT-END SALES LOADS OF 2% IN YEARS 1 THROUGH 10
AND 0% THEREAFTER, AND GUARANTEED FRONT-END SALES LOADS OF 2% IN ALL YEARS.
THE SURRENDER CHARGE EFFECTIVE IN ANY YEAR CAN BE DETERMINED BY SUBTRACTING THE
CASH SURRENDER VALUE FROM THE ACCOUNT VALUE.
THE DEATH BENEFIT MAY, AND THE ACCOUNT VALUES AND CASH VALUES WILL DIFFER IF
PREMIUMS ARE PAID IN DIFFERENT AMOUNTS OR FREQUENCIES.
THE HYPOTHETICAL INVESTMENT RESULTS SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE INVESTMENT RESULTS. ACTUAL INVESTMENT RESULTS MAY BE MORE OR LESS
THAN THOSE SHOWN. THE DEATH BENEFIT, ACCOUNT VALUE AND CASH SURRENDER VALUE FOR
A POLICY WOULD BE DIFFERENT FROM THOSE SHOWN IF ACTUAL INVESTMENT RETURN
APPLICABLE TO THE POLICY AVERAGE 12% OVER A PERIOD OF YEARS, BUT ALSO FLUCTUATED
ABOVE OR BELOW THAT AVERAGE FOR INDIVIDUAL POLICY YEARS. THE DEATH BENEFIT,
ACCOUNT VALUE AND CASH SURRENDER VALUE FOR A POLICY WOULD ALSO BE DIFFERENT FROM
THOSE SHOWN, DEPENDING ON THE INVESTMENT ALLOCATIONS MADE TO THE SEPARATE
ACCOUNTS AND THE RATES OF RETURN OF THE SEPARATE ACCOUNT IF THE ACTUAL RATES OF
INVESTMENT RETURN APPLICABLE TO THE POLICY AVERAGED 12%, BUT VARIED ABOVE OR
BELOW THAT AVERAGE FOR THE SEPARATE ACCOUNT. NO REPRESENTATION CAN BE MADE THAT
THIS HYPOTHETICAL RATE OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR SUSTAINED
OVER ANY PERIOD OF TIME.
44
<PAGE>
ITT HARTFORD LIFE AND ANNUITY
INSURANCE COMPANY
FLEXIBLE PREMIUM VARIABLE LIFE INSURANCE
DEATH BENEFIT OPTION: LEVEL
$250,000 FACE AMOUNT
ISSUE AGE 45 MALE PREFERRED
$3,250 SCHEDULED PREMIUM
ASSUMING HYPOTHETICAL GROSS ANNUAL INVESTMENT RETURN OF 0% (-0.70% NET)
<TABLE>
<CAPTION>
CURRENT CHARGES* GUARANTEED CHARGES**
PREMIUMS ----------------------------------- -----------------------------------
END OF ACCUMULATED CASH CASH
CONTRACT AT 5% INTEREST ACCOUNT SURRENDER DEATH ACCOUNT SURRENDER DEATH
YEAR PER YEAR VALUE VALUE BENEFIT VALUE VALUE BENEFIT
--------- --------------- ---------- --------- ---------- ---------- --------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
1 3,413 1,869 0*** 253,250 1,869 0*** 253,250
2 6,996 3,814 814*** 256,500 3,814 814*** 256,500
3 10,758 5,650 2,650 259,750 5,650 2,650 259,750
4 14,708 7,369 4,369 263,000 7,369 4,369 263,000
5 18,856 9,048 6,048 266,250 8,964 5,964 266,250
6 23,212 10,597 7,870 269,500 10,422 7,694 269,500
7 27,785 12,031 9,576 272,750 11,727 9,272 272,750
8 32,586 13,338 11,156 276,000 12,861 10,678 276,000
9 37,628 14,506 12,596 279,250 13,802 11,892 279,250
10 42,922 15,525 13,887 282,500 14,530 12,893 282,500
11 48,481 16,671 15,308 285,750 15,102 13,739 285,750
12 54,317 17,781 16,691 289,000 15,416 14,326 289,000
13 60,446 18,691 17,874 292,250 15,455 14,638 292,250
14 66,880 19,377 18,832 295,500 15,187 14,642 295,500
15 73,637 19,811 19,539 298,750 14,571 14,298 298,750
16 80,731 19,963 19,963 302,000 13,561 13,561 302,000
17 88,180 19,798 19,798 305,250 12,105 12,105 305,250
18 96,002 19,264 19,264 308,500 10,127 10,127 308,500
19 104,214 18,308 18,307 311,750 7,546 7,546 311,750
20 112,838 16,872 16,872 315,000 4,274 4,274 315,000
25 162,869 2,177 2,177 331,250 -- -- --
35 308,218 -- -- -- -- -- --
</TABLE>
<TABLE>
<C> <S>
* THESE VALUES REFLECT INVESTMENT RESULTS USING CURRENT COST OF INSURANCE
RATES, ADMINISTRATIVE FEES, AND MORTALITY AND EXPENSE RISK RATES.
** THESE VALUES REFLECT INVESTMENT RESULTS USING GUARANTEED COST OF INSURANCE
RATES, ADMINISTRATIVE FEES, AND MORTALITY AND EXPENSE RISK RATES.
*** IF YOU SURRENDER YOUR POLICY DURING THE FIRST TWO POLICY YEARS, YOU WILL
RECEIVE A REFUND IN ADDITION TO THE CASH VALUES SHOWN. THE REFUND PLUS THE
CASH VALUE WOULD BE $0 IN YEAR ONE AND $1,147 IN YEAR TWO.
</TABLE>
THESE VALUES REFLECT CURRENT FRONT-END SALES LOADS OF 2% IN YEARS 1 THROUGH 10
AND 0% THEREAFTER, AND GUARANTEED FRONT-END SALES LOADS OF 2% IN ALL YEARS.
THE SURRENDER CHARGE EFFECTIVE IN ANY YEAR CAN BE DETERMINED BY SUBTRACTING THE
CASH SURRENDER VALUE FROM THE ACCOUNT VALUE.
THE DEATH BENEFIT MAY, AND THE ACCOUNT VALUES AND CASH VALUES WILL DIFFER IF
PREMIUMS ARE PAID IN DIFFERENT AMOUNTS OR FREQUENCIES.
THE HYPOTHETICAL INVESTMENT RESULTS SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE INVESTMENT RESULTS. ACTUAL INVESTMENT RESULTS MAY BE MORE OR LESS
THAN THOSE SHOWN. THE DEATH BENEFIT, ACCOUNT VALUE AND CASH SURRENDER VALUE FOR
A POLICY WOULD BE DIFFERENT FROM THOSE SHOWN IF ACTUAL INVESTMENT RETURN
APPLICABLE TO THE POLICY AVERAGE 0% OVER A PERIOD OF YEARS, BUT ALSO FLUCTUATED
ABOVE OR BELOW THAT AVERAGE FOR INDIVIDUAL POLICY YEARS. THE DEATH BENEFIT,
ACCOUNT VALUE AND CASH SURRENDER VALUE FOR A POLICY WOULD ALSO BE DIFFERENT FROM
THOSE SHOWN, DEPENDING ON THE INVESTMENT ALLOCATIONS MADE TO THE SEPARATE
ACCOUNTS AND THE RATES OF RETURN OF THE SEPARATE ACCOUNT IF THE ACTUAL RATES OF
INVESTMENT RETURN APPLICABLE TO THE POLICY AVERAGED 0%, BUT VARIED ABOVE OR
BELOW THAT AVERAGE FOR THE SEPARATE ACCOUNT. NO REPRESENTATION CAN BE MADE THAT
THIS HYPOTHETICAL RATE OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR SUSTAINED
OVER ANY PERIOD OF TIME.
45
<PAGE>
ITT HARTFORD LIFE AND ANNUITY
INSURANCE COMPANY
FLEXIBLE PREMIUM VARIABLE LIFE INSURANCE
DEATH BENEFIT OPTION: LEVEL
$250,000 FACE AMOUNT
ISSUE AGE 45 MALE PREFERRED
$3,250 SCHEDULED PREMIUM
ASSUMING HYPOTHETICAL GROSS ANNUAL INVESTMENT RETURN OF 6% (5.30% NET)
<TABLE>
<CAPTION>
CURRENT CHARGES* GUARANTEED CHARGES**
PREMIUMS -------------------------------- --------------------------------
END OF ACCUMULATED CASH CASH
CONTRACT AT 5% INTEREST ACCOUNT SURRENDER DEATH ACCOUNT SURRENDER DEATH
YEAR PER YEAR VALUE VALUE BENEFIT VALUE VALUE BENEFIT
--------- --------------- --------- -------- --------- --------- -------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
1 3,413 2,015 0*** 253,250 2,015 0*** 253,250
2 6,996 4,227 1,227*** 256,500 4,227 1,227*** 256,500
3 10,758 6,457 3,457 259,750 6,457 3,457 259,750
4 14,708 8,697 5,697 263,000 8,697 5,697 263,000
5 18,856 11,024 8,024 266,250 10,937 7,937 266,250
6 23,212 13,350 10,623 269,500 13,165 10,438 269,500
7 27,785 15,691 13,236 272,750 15,363 12,908 272,750
8 32,586 18,033 15,851 276,000 17,511 15,328 276,000
9 37,628 20,365 18,455 279,250 19,582 17,672 279,250
10 42,922 22,676 21,038 282,500 21,554 19,916 282,500
11 48,481 25,293 23,930 285,750 23,502 22,139 285,750
12 54,317 28,027 26,937 289,000 25,304 24,214 289,000
13 60,446 30,722 29,905 292,250 26,937 26,120 292,250
14 66,880 33,354 32,809 295,500 28,360 27,815 295,500
15 73,637 35,894 35,621 298,750 29,524 29,251 298,750
16 80,731 38,310 38,310 302,000 30,371 30,371 302,000
17 88,180 40,566 40,566 305,250 30,838 30,838 305,250
18 96,002 42,607 42,607 308,500 30,831 30,831 308,500
19 104,214 44,374 44,374 311,750 30,249 30,249 311,750
20 112,838 45,806 45,806 315,000 28,981 28,981 315,000
25 162,869 47,282 47,282 331,250 7,376 7,376 331,250
35 308,218 -- -- -- -- -- --
</TABLE>
<TABLE>
<C> <S>
* THESE VALUES REFLECT INVESTMENT RESULTS USING CURRENT COST OF INSURANCE
RATES, ADMINISTRATIVE FEES, AND MORTALITY AND EXPENSE RISK RATES.
** THESE VALUES REFLECT INVESTMENT RESULTS USING GUARANTEED COST OF INSURANCE
RATES, ADMINISTRATIVE FEES, AND MORTALITY AND EXPENSE RISK RATES.
*** IF YOU SURRENDER YOUR POLICY DURING THE FIRST TWO POLICY YEARS, YOU WILL
RECEIVE A REFUND IN ADDITION TO THE CASH VALUES SHOWN. THE REFUND PLUS THE
CASH VALUE WOULD BE $0 IN YEAR ONE AND $1,560 IN YEAR TWO.
</TABLE>
THESE VALUES REFLECT CURRENT FRONT-END SALES LOADS OF 2% IN YEARS 1 THROUGH 10
AND 0% THEREAFTER, AND GUARANTEED FRONT-END SALES LOADS OF 2% IN ALL YEARS.
THE SURRENDER CHARGE EFFECTIVE IN ANY YEAR CAN BE DETERMINED BY SUBTRACTING THE
CASH SURRENDER VALUE FROM THE ACCOUNT VALUE.
THE DEATH BENEFIT MAY, AND THE ACCOUNT VALUES AND CASH VALUES WILL DIFFER IF
PREMIUMS ARE PAID IN DIFFERENT AMOUNTS OR FREQUENCIES.
THE HYPOTHETICAL INVESTMENT RESULTS SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE INVESTMENT RESULTS. ACTUAL INVESTMENT RESULTS MAY BE MORE OR LESS
THAN THOSE SHOWN. THE DEATH BENEFIT, ACCOUNT VALUE AND CASH SURRENDER VALUE FOR
A POLICY WOULD BE DIFFERENT FROM THOSE SHOWN IF ACTUAL INVESTMENT RETURN
APPLICABLE TO THE POLICY AVERAGE 6% OVER A PERIOD OF YEARS, BUT ALSO FLUCTUATED
ABOVE OR BELOW THAT AVERAGE FOR INDIVIDUAL POLICY YEARS. THE DEATH BENEFIT,
ACCOUNT VALUE AND CASH SURRENDER VALUE FOR A POLICY WOULD ALSO BE DIFFERENT FROM
THOSE SHOWN, DEPENDING ON THE INVESTMENT ALLOCATIONS MADE TO THE SEPARATE
ACCOUNTS AND THE RATES OF RETURN OF THE SEPARATE ACCOUNT IF THE ACTUAL RATES OF
INVESTMENT RETURN APPLICABLE TO THE POLICY AVERAGED 6%, BUT VARIED ABOVE OR
BELOW THAT AVERAGE FOR THE SEPARATE ACCOUNT. NO REPRESENTATION CAN BE MADE THAT
THIS HYPOTHETICAL RATE OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR SUSTAINED
OVER ANY PERIOD OF TIME.
46
<PAGE>
ITT HARTFORD LIFE AND ANNUITY
INSURANCE COMPANY
FLEXIBLE PREMIUM VARIABLE LIFE INSURANCE
DEATH BENEFIT OPTION: LEVEL
$250,000 FACE AMOUNT
ISSUE AGE 45 MALE PREFERRED
$3,250 SCHEDULED PREMIUM
ASSUMING HYPOTHETICAL GROSS ANNUAL INVESTMENT RETURN OF 12% (11.30% NET)
<TABLE>
<CAPTION>
CURRENT CHARGES* GUARANTEED CHARGES**
PREMIUMS ----------------------------------- -----------------------------------
END OF ACCUMULATED CASH CASH
CONTRACT AT 5% INTEREST ACCOUNT SURRENDER DEATH ACCOUNT SURRENDER DEATH
YEAR PER YEAR VALUE VALUE BENEFIT VALUE VALUE BENEFIT
--------- --------------- ---------- --------- ---------- ---------- --------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
1 3,413 2,161 0*** 253,250 2,161 0*** 253,250
2 6,996 4,659 1,659*** 256,500 4,659 1,659*** 256,500
3 10,758 7,335 4,335 259,750 7,335 4,335 259,750
4 14,708 10,200 7,200 263,000 10,200 7,200 263,000
5 18,856 13,353 10,353 266,250 13,265 10,265 266,250
6 23,212 16,733 14,006 269,500 16,539 13,812 269,500
7 27,785 20,380 17,925 272,750 20,029 17,574 272,750
8 32,586 24,311 22,128 276,000 23,741 21,558 276,000
9 37,628 28,545 26,635 279,250 27,678 25,768 279,250
10 42,922 33,108 31,470 282,500 31,847 30,209 282,500
11 48,481 38,444 37,082 285,750 36,399 35,037 285,750
12 54,317 44,376 43,286 289,000 41,233 40,143 289,000
13 60,446 50,814 49,996 292,250 46,369 45,551 292,250
14 66,880 57,804 57,259 295,500 51,822 51,277 295,500
15 73,637 65,397 65,124 298,750 57,603 57,331 298,750
16 80,731 73,647 73,647 302,000 63,725 63,725 302,000
17 88,180 82,622 82,622 305,250 70,201 70,201 305,250
18 96,002 92,383 92,383 308,500 77,033 77,033 308,500
19 104,214 103,011 103,011 311,750 84,226 84,226 311,750
20 112,838 114,602 114,602 315,000 91,792 91,792 315,000
25 162,869 193,630 193,630 331,250 136,348 136,348 331,250
35 308,218 570,647 570,647 573,656 290,653 290,653 363,750
</TABLE>
<TABLE>
<C> <S>
* THESE VALUES REFLECT INVESTMENT RESULTS USING CURRENT COST OF INSURANCE
RATES, ADMINISTRATIVE FEES, AND MORTALITY AND EXPENSE RISK RATES.
** THESE VALUES REFLECT INVESTMENT RESULTS USING GUARANTEED COST OF INSURANCE
RATES, ADMINISTRATIVE FEES, AND MORTALITY AND EXPENSE RISK RATES.
*** IF YOU SURRENDER YOUR POLICY DURING THE FIRST TWO POLICY YEARS, YOU WILL
RECEIVE A REFUND IN ADDITION TO THE CASH VALUES SHOWN. THE REFUND PLUS THE
CASH VALUE WOULD BE $0 IN YEAR ONE AND $1,992 IN YEAR TWO.
</TABLE>
THESE VALUES REFLECT CURRENT FRONT-END SALES LOADS OF 2% IN YEARS 1 THROUGH 10
AND 0% THEREAFTER, AND GUARANTEED FRONT-END SALES LOADS OF 2% IN ALL YEARS.
THE SURRENDER CHARGE EFFECTIVE IN ANY YEAR CAN BE DETERMINED BY SUBTRACTING THE
CASH SURRENDER VALUE FROM THE ACCOUNT VALUE.
THE DEATH BENEFIT MAY, AND THE ACCOUNT VALUES AND CASH VALUES WILL DIFFER IF
PREMIUMS ARE PAID IN DIFFERENT AMOUNTS OR FREQUENCIES.
THE HYPOTHETICAL INVESTMENT RESULTS SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE INVESTMENT RESULTS. ACTUAL INVESTMENT RESULTS MAY BE MORE OR LESS
THAN THOSE SHOWN. THE DEATH BENEFIT, ACCOUNT VALUE AND CASH SURRENDER VALUE FOR
A POLICY WOULD BE DIFFERENT FROM THOSE SHOWN IF ACTUAL INVESTMENT RETURN
APPLICABLE TO THE POLICY AVERAGE 12% OVER A PERIOD OF YEARS, BUT ALSO FLUCTUATED
ABOVE OR BELOW THAT AVERAGE FOR INDIVIDUAL POLICY YEARS. THE DEATH BENEFIT,
ACCOUNT VALUE AND CASH SURRENDER VALUE FOR A POLICY WOULD ALSO BE DIFFERENT FROM
THOSE SHOWN, DEPENDING ON THE INVESTMENT ALLOCATIONS MADE TO THE SEPARATE
ACCOUNTS AND THE RATES OF RETURN OF THE SEPARATE ACCOUNT IF THE ACTUAL RATES OF
INVESTMENT RETURN APPLICABLE TO THE POLICY AVERAGED 12%, BUT VARIED ABOVE OR
BELOW THAT AVERAGE FOR THE SEPARATE ACCOUNT. NO REPRESENTATION CAN BE MADE THAT
THIS HYPOTHETICAL RATE OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR SUSTAINED
OVER ANY PERIOD OF TIME.
47
<PAGE>
FINANCIAL STATEMENTS
TO BE PROVIDED BY AMENDMENT
48
<PAGE>
CONTENTS OF REGISTRATION STATEMENT
This Registration Statement comprises the following papers and documents:
The facing sheet.
The prospectus consisting of ______ pages.
The undertaking to file reports.
The Rule 484 undertaking.
The signatures.
(1) The following exhibits included herewith correspond to those required
by paragraph A of the instructions for exhibits to Form N-8B-2.
(A1) Resolution of Board of Directors of the Company authorizing the
Separate Account is incorporated by reference to Pre-Effective
Amendment No. 1, to the Registration Statement File No. 33-61267,
dated January 23, 1996.
(A2) Not applicable.
(A3a)Principal Underwriting Agreement is incorporate herein.
(A3b)Form of Selling Agreements is incorporate herein.
(A3c)Not applicable.
(A4) Not applicable.
(A5) Form of Flexible Premium Variable Life Insurance Policy is
incorporated herein.
(A6a)Charter of ITT Hartford Life and Annuity Insurance Company is
incorporated herein.
(A6b)Bylaws of ITT Hartford Life and Annuity Insurance Company is
incorporated herein.
(A7) Not applicable.
(A8) Not applicable.
(A9) Not applicable.
<PAGE>
(A10)Form of Application for Flexible Premium Variable Life Insurance
Policies is incorporated by reference as stated above.
(A11)Memorandum describing transfer and redemption procedures will
be filed by amendment.
(2) Opinion and counsel of Lynda Godkin, General Counsel is incorporated
herein.
(3) No financial statement will be omitted from the Prospectus pursuant to
Instruction 1(b) or (c) of Part I.
(4) Not applicable.
(5) Opinion and consent of Ken A. McCullum, FSA, MAAA is incorporated herein.
(6) Consent of Arthur Andersen LLP, Independent Public Accountants will be
filed by amendment.
(7) Opinion and consent of Counsel is incorporated by reference as Exhibit 2.
(8) Opinion and consent of Actuary is incorporated by reference as Exhibit 5.
(9) Power of Attorney is incorporate herein.
<PAGE>
UNDERTAKING TO FILE REPORTS
Subject to the terms and conditions of Section 15(d) of the Securities
Exchange Act of 1934, the undersigned Registrant hereby undertakes to file
with the Securities and Exchange Commission such supplementary and periodic
information, documents, and reports as may be prescribed by any rule or
regulation of the Commission heretofore or hereafter duly adopted pursuant to
authority conferred in that section.
UNDERTAKINGS AND REPRESENTATIONS AS REQUIRED BY RULE 6e-3(T)
1. Separate Account VL I meets the definition of "Separate Account" under
Rule 6e-3(T).
2. The Registrant represents that:
(a) it relies on Rule 6e-3(T)(b)(13)(ii)(F) to offer the Policies;
(b) the level of mortality and expense risk charge is within the range
of industry practice for comparable flexible contracts.
(c) the Company has conducted a survey of similar policies and insurers
and determined that the charge is within the range of industry practice;
(d) the Company undertakes to keep and make available to the Commission
upon request the documents we used to support the representation in (b);
and
(e) the Company further represents that the account will invest only in
management investment companies which have undertaken to have a
Board of Directors, a majority of whom are not interested persons of
the Company, formulate and approve a plan under Rule 12b-1 to
finance distribution expenses.
(f) The life insurer has concluded that there is a reasonable likelihood
that the distribution financing arrangement of the separate
account benefits the separate account and contractholders and
will keep and make available to the Commission on request a
memorandum setting for the basis for this representation.
UNDERTAKING ON INDEMNIFICATION
Article VIII of the Bylaws of ITT Hartford Life and Annuity Insurance Company,
a Connecticut corporation, provides for indemnification of its officers,
directors and employees as follows:
SECTION 1. No person shall be liable to the Company for any loss or damage
suffered by it on account of any action taken or omitted to be taken by him
as director or officer of the Company, or of any other company, partnership,
joint venture, trust or other enterprise for which he serves as a director,
officer or employee at the request of the Company, in good faith, if such
person (a) exercised and used the same degree of care and skill as a prudent
man would have exercised or used under the circumstances in the conduct of
his own affairs, or (b) took or omitted to take such action in reliance upon
advice of counsel for the Company or upon statements made or information
furnished by officers or employees of the Company which he had reasonable
grounds to believe to be true. The foregoing shall not be exclusive of other
rights and defenses to which he may be entitled as a matter of law.
<PAGE>
SECTION 2. The Company shall indemnify any person who was or is a party or
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, (other than one by or in the right of the Company) by
reason of the fact that he is or was a director, officer or employee of the
company , or is or was serving at the request of the Company as a director,
officer or employee of another company, partnership, joint venture, trust or
other enterprise, against expenses, including attorneys' fees, judgments,
fines and amounts paid in settlement actually and reasonable y incurred by
him in connection with such action, suit or proceeding if he acted in good
faith and in a manner he reasonable believed to be in or not opposed to the
best interests of the Company, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his conduct was unlawful. The
termination of any action, suit or proceeding by judgment, order, settlement,
conviction, or upon a plea of nolo contendere or its equivalent, shall no, of
itself, create a presumption that the person did not act in good faith and in
a manner which he reasonably believed to be in or not opposed to the best
interests of the Company, and with respect to any criminal action or
proceeding had reasonable cause to believe that his conduct was unlawful.
SECTION 3. The Company shall indemnify any person who was or is a party or
is threatened to be made a party to any threatened, pending or completed
action, suit or proceeding, by or in the right of the Company to procure a
judgment in its favor by reason of the fact that he is or was a director,
officer or employee of the Company, or is or was serving at the request of
the Company as a director, officer or employee of another company,
partnership, joint venture, trust or other enterprise against expenses,
including attorneys' fees, actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit, if he acted
in good faith and in a manner he reasonably believed to be in or not opposed
to the best interests of the Company, except that no indemnification shall be
made in respect of any claim, issue or matter as to which such person shall
have been adjudged to be liable for negligence or misconduct in the
performance of his duty to the Company unless and only to the extent that the
court in which such action or suit was brought shall determine upon
application that, despite the adjudication of liability and in view of all
circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses as such court shall deem proper.
SECTION 4. Expenses, including attorneys' fees, incurred in defending a
civil or criminal action, suit or proceeding may be paid by the Company in
advance of the final disposition of such action, suit or proceeding, upon
receipt of any undertaking by or on behalf of the director or employee to
repay such amount unless it shall ultimately be determined that he is
entitled to be indemnified by the Company as authorized hereby.
SECTION 5. The indemnification provided by this Article shall not be deemed
exclusive of any other rights to which those indemnified may be entitled
under any statute, bylaw, agreement, vote of shareholders or of disinterested
directors or otherwise, both as to action in an official capacity and as to
action in another capacity while holding such office, and shall continue as
to a person who has ceased to be a director, officer or employee and shall
inure to the benefit of the heirs, executors and administrators of such a
person.
The registrant hereby undertakes that insofar as indemnification for
liability arising under the
<PAGE>
Securities Act of 1933 (the "Act") may be permitted to directors, officers
and controlling persons of the registrant, pursuant to the foregoing
provisions, or otherwise, the registrant has been advised that in the opinion
of the Securities and Exchange Commission such indemnification is against
public policy as expressed in the Act and is, therefore, unenforceable. In
the event that a claim for indemnification against such liabilities (other
than the payment by the registrant of expenses incurred or paid by a
director, officer or controlling person of the registrant in the successful
defense of any action, suit or proceeding) is asserted by such director,
officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed by the
final adjudication of such issue.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the Investment
Company Act of 1940, the Registrant has duly caused this Registration
Statement to be signed on its behalf by the undersigned thereunto duly
authorized, and its seal to be herewith affixed and attested, all in the city
of Simsbury, and the State of Connecticut on the 1 day of July , 1996.
ITT HARTFORD LIFE AND ANNUITY INSURANCE
COMPANY
SEPARATE ACCOUNT VL I
(Registrant)
By: /s/ Gregory A. Boyko
---------------------------------------------
Gregory A. Boyko, Vice President & Controller
ITT HARTFORD LIFE AND ANNUITY INSURANCE
COMPANY
(Depositor)
By: /s/ Gregory A. Boyko
---------------------------------------------
Gregory A. Boyko, Vice President & Controller
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed by the following persons and in the capacities and
on the dates indicated.
Donald R. Frahm, Director *
Bruce D. Gardner, Director *
Joseph H. Gareau, Executive Vice
President, Chief Investment
Officer, Director *
Joseph Kanarek, Vice President,
Director
Thomas M. Marra, Executive Vice *By: /s/ Lynda Godkin
President, Director * -------------------
Lowndes A. Smith, President, Lynda Godkin
Chief Executive Officer, Attorney-In-Fact
Director *
Lizabeth H. Zlatkus, Vice President Dated: July 1, 1996
Director *
<PAGE>
[Exhibit 1A3a]
PRINCIPAL UNDERWRITER AGREEMENT
THIS AGREEMENT, dated as of the June 26, 1995, made by and between HARTFORD
LIFE INSURANCE COMPANY ("HLIC" or the "Sponsor"), a corporation organized and
existing under the laws of the State of Connecticut, and HARTFORD EQUITY
SALES COMPANY, INC. ("HESCO"), a corporation organized and existing under the
laws of the State of Connecticut,
WITNESSETH:
WHEREAS, the Board of Directors of HLIC has made provision for the
establishment of a separate account within HLIC in accordance with the laws
of the State of Connecticut, which separate account was organized and is
established and registered as a unit investment trust type investment company
with the Securities and Exchange Commission under the Investment Company Act
of 1940 ("1940 Act"), as amended, and which is designated Hartford Life
Insurance Company Separate Account VL I (referred to as the "UIT"); and
WHEREAS, HESCO offers to the public a certain Flexible Premium Variable Life
Insurance Policy (the "Policy") issued by HLIC with respect to the UIT units
of interest thereunder which are registered under the Securities Act of 1933
("1933 Act"), as amended; and
WHEREAS, HESCO has previously agreed to act as distributor in connection
with offers and sales of the Policy under the terms and conditions set forth
in this Principal Underwriter Agreement.
NOW THEREFORE, in consideration of the mutual agreements made herein, HLIC
and HESCO agree as follows:
I.
HESCO'S DUTIES
1. HESCO, as principal underwriter for the Policy, will use its best efforts
to effect offers and sales of the Policy through broker-dealers that are
members of the National Association of Securities Dealers, Inc. and whose
registered representatives are duly licensed as insurance agents of HLIC.
HESCO is responsible for compliance with all applicable requirements of the
1933 Act, as amended, the Securities Exchange Act of 1934 ("1934 Act"), as
amended, and the 1940 Act, as amended, and the rules and regulations
relating to the sales and distribution of the Policy, the need for which
arises out of its duties as principal underwriter of said Policy and
relating to the creation of the UIT.
<PAGE>
2. HESCO agrees that it will not use any prospectus, sales literature,
or any other printed matter or material or offer for sale or sell the
Policy if any of the foregoing in any way represent the duties,
obligations, or liabilities of HLIC as being greater than, or different
from, such duties, obligations and liabilities as are set forth in this
Agreement, as it may be amended from time to time.conclusion provided
for in subsection (b) of this section may be reached by any one of the
following: (1) The Board of Directors of the corporation by a consent
in writing signed by a majority of those directors who were not parties
to such proceeding; (2) independent legal counsel selected by a consent
in writing signed by a majority of those directors who were not parties
to such proceeding; (3) in the case of any employee or agent who is not
an officer or director of the corporation, the corporation's general
counsel; or (4) the shareholders of the corporation by the affirmative
vote of at least a majority of the voting power of shares not owned by
parties to such proceeding, represented at an annual or special meeting
of shareholders, duly called with notice of such purpose stated. Such
person shall also be entitled to apply to a court for such conclusion,
upon application as provided in subsection (e), even though the
conclusion reached by any of the foregoing shall have been adverse to
him or to the person whose legal representative he is.
(e) Where an application for indemnification or for a conclusion as provided
in this section is made to a court, it shall be made to the court in which
the proceeding is pending or to the superior court for the judicial district
where the principal office of the corporation is located. The application
shall be made in such manner and form as may be required by the applicable
rules of the court or, in the absence thereof, by direction of the court.
The court may also direct the notice be given in such manner as it may
require at the expense of the corporation to the shareholders of the
corporation and to such other persons as the court may designate. In the
case of an application to a court in which a proceeding is pending in which
the person seeking indemnification is a party by reason of the fact that he,
or the person whose legal representative he is, is or was serving at the
request of the corporation as a director, partner, trustee, officer, employee
or agent of another enterprise, or as a fiduciary of an employee benefit plan
or trust maintained for the benefit of employees of any other enterprise,
timely notice of such application shall be given by such person to the
corporation.
3. HESCO agrees that it will utilize the then currently effective prospectus
relating to the UIT's Policies in connection with its selling efforts.
As to the other types of sales materials, HESCO agrees that it will use
only sales materials which conform to the requirements of federal and state
insurance laws and regulations and which have been filed, where necessary,
with the appropriate regulatory authorities.
4. HESCO agrees that it or its duly designated agent shall maintain records
of the name and address of, and the securities issued by the UIT and held
by, every holder of any security issued pursuant to this Agreement, as
required by the Section 26(a)(4) of the 1940 Act, as amended.
<PAGE>
5. HESCO's services pursuant to this Agreement shall not be deemed to be
exclusive, and it may render similar services and act as an underwriter,
distributor, or dealer for other investment companies in the offering of
their shares.
6. In the absence of willful misfeasance, bad faith, gross negligence, or
reckless disregard of its obligations and duties hereunder on the part of
HESCO, HESCO shall not be subject to liability under a Policy for any act
or omission in the course, or connected with, rendering services hereunder.
II.
1. The UIT reserves the right at any time to suspend or limit the public
offering of the Policies upon 30 days' written notice to HESCO, except
where the notice period may be shortened because of legal action taken
by any regulatory agency.
2. The UIT agrees to advice HESCO immediately:
(a) Of any request by the Securities and Exchange Commission for
amendment of its 1933 Act registration statement or for additional
information;
(b) Of the issuance by the Securities and Exchange Commission of any stop
order suspending the effectiveness of the 1933 Act registration
statement relating to units of interest issued with respect to the
UIT or of the initiation of any proceedings for that purpose;
(c) Of the happening of any material event, if known, which makes untrue
any statement in said 1933 Act registration statement or which requires
a change therein in order to make any statement therein not misleading.
HLIC will furnish to HESCO such information with respect to the UIT and
the Policies in such form and signed by such of its officers and directors
and HESCO may reasonably request and will warrant that the statements
therein contained when so signed will be true and correct. HLIC will also
furnish, from time to time, such additional information regarding the UIT's
financial condition as HESCO may reasonably request.
III.
COMPENSATION
In accordance with an Expense Reimbursement Agreement between HLIC and HESCO,
HESCO is entitled to receive: (1) compensation equal to a pro rata portion
of $10,000 per year for all services provided on behalf of HLIC and the UIT;
plus (2) reimbursement for the actual expenses incurred by HESCO in excess of
$10,000 for all operating costs associated with the services provided on
behalf of HLIC and the UIT under this Principal Underwriter Agreement. No
additional compensation is payable in excess of that required under the
Expense Reimbursement Agreement.
<PAGE>
The Expense Reimbursement Agreement provides for an aggregate payment of
$10,000 for all services performed by HESCO on behalf of HLIC and its
affiliated companies and any unit investment trusts sponsored by HLIC and its
affiliated companies.
IV.
RESIGNATION AND REMOVAL OF PRINCIPAL UNDERWRITER
HESCO may resign as a Principal Underwriter hereunder, upon 120 days' prior
written notice to HLIC. However, such resignation shall not become effective
until either the UIT has been completely liquidated and the proceeds of the
liquidation distributed through HLIC to the Policy owners or a successor
Principal Underwriter has been designated and has accepted its duties.
V.
MISCELLANEOUS
1. This Agreement may not be assigned by any of the parties hereto without
the written consent of the other party.
2. All notices and other communications provided for hereunder shall be in
writing and shall be delivered by hand or mailed first class, postage
prepaid, addressed as follows:
(a) If to HLIC - Hartford Life Insurance Company, Inc. P.O. Box 2999,
Hartford, Connecticut 06104.
(b) If to HESCO - Hartford Equity Sales Company, Inc., P.O. Box 2999,
Hartford, Connecticut 06104.
or to such other address as HESCO or HLIC shall designate by written
notice to the other.
3. This Agreement may be executed in any number of counterparts, each of
which shall be deemed an original and all of which shall be deemed one
instrument, and an executed copy of this Agreement and all amendments
hereto shall be kept on file by the Sponsor and shall be open to inspection
any time during the business hours of the Sponsor.
4. This Agreement shall inure to the benefit of and be binding upon the
successor of the parties hereto.
5. This Agreement shall be construed and governed by and according to the
laws of the State of Connecticut.
6. This Agreement may be amended from time to time by the mutual agreement
and consent of the parties hereto.
<PAGE>
7. (a) This Agreement shall become effective June 26, 1995 and shall continue
in effect for a period of two years from that date and, unless sooner
terminated in accordance with 7(b) below, shall continue in effect
from year to year thereafter provided that its continuance is
specifically approved at least annually by a majority of the members
of the Board of Directors of HLIC.
(b) This Agreement (1) may be terminated at any time, without the payment
of any penalty, either by a vote of a majority of the members of the
Board of Directors of HLIC on 60 days' prior written notice to HESCO;
(2) shall immediately terminate in the event of its assignment and
(3) may be terminated by HESCO on 60 days' prior written notice to
HLIC, but such termination will not be effective until HLIC shall have
an agreement with one or more persons to act as successor principal
underwriter of the Policies. HESCO hereby agrees that it will continue
to act as successor principal underwriter until its successor or
successors assume such undertaking.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed and their respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.
(Seal) HARTFORD LIFE INSURANCE COMPANY
BY: /s/ Thomas M. Marra
------------------------------
Thomas M. Marra
Senior Vice President
Attest: HARTFORD EQUITY SALES COMPANY, INC.
/s/ Lynda Godkin BY: /s/ George Jay
- -------------------- ------------------------------
Lynda Godkin George Jay
Secretary Controller
<PAGE>
BROKER-DEALER SALES AND
SUPERVISION AGREEMENT
This Broker-Dealer Sales and Supervision Agreement ("Agreement")
dated ____________________ is made by and between Hartford Life Insurance
Company and ITT Hartford Life and Annuity Insurance Company (referred to
collectively as "Companies"), Hartford Securities Distribution Company, Inc.
("Distributor"), a broker-dealer registered with the Securities and Exchange
Commission ("SEC") under the Securities and Exchange Act of 1934 ("1934 Act")
and a member of the National Association of Securities Dealers, Inc. ("NASD")
and __________________________________, who is also a broker-dealer registered
with the SEC under the 1934 Act and a member of the NASD ("Broker-Dealer"), and
any and all undersigned insurance agency affiliates ("Affiliates") of Broker-
Dealer.
WHEREAS, Companies offer certain variable life insurance policies and variable
and modified guaranteed annuity contracts which are deemed to be securities
under the Securities Act of 1933 (the "Registered Products"); and
WHEREAS, Companies wish to appoint the Broker-Dealer and Affiliates as agents of
the Companies for the solicitation and procurement of applications for
Registered Products; and
WHEREAS, Distributor is the principal underwriter of the Registered Products;
and
WHEREAS, Distributor anticipates having registered representatives who are
associated with Broker-Dealer ("Registered Representatives"), who are NASD
registered and are duly licensed under applicable state insurance law and
appointed as life insurance agents of Companies solicit and sell the Registered
Products; and
WHEREAS, Distributor acknowledges that the Broker-Dealer will provide certain
supervisory and administrative services to Registered Representatives who are
associated with the Broker-Dealer in connection with the solicitation, service
and sale of the Registered Products; and
WHEREAS, Broker-Dealer agrees to provide the aforementioned supervisory services
to its Registered Representatives who have been appointed by the Companies to
sell the Registered Products.
NOW THEREFORE, in consideration of the mutual covenants contained in this
Agreement, the parties agree to the following:
I. APPOINTMENT OF THE BROKER-DEALER
The Companies hereby appoint Broker-Dealer as an agent of the Companies for
the solicitation and procurement of applications for the Registered
Products offered by the Companies, as outlined in Exhibit A attached
herein, in all states in which the Companies are authorized to do business
and in which Broker-Dealer or any Affiliates are properly licensed.
Distributor hereby authorizes Broker-Dealer under the securities laws to
supervise Registered Representatives in connection with the solicitation,
service and sale of the Registered Products.
II. AUTHORITY OF THE BROKER-DEALER
<PAGE>
Broker-Dealer has the authority to represent Distributor and Companies only
to the extent expressly granted in this Agreement. Broker-Dealer and any
Registered Representatives shall not hold themselves out to be employees of
Companies or Distributor in any dealings with the public. Broker-Dealer
and any Registered Representatives shall be independent contractors as to
Distributor or Companies. Nothing contained herein is intended to create a
relationship of employer and employee between Broker-Dealer and Distributor
or Companies or between Registered Representatives and Distributor or
Companies.
III. BROKER-DEALER REPRESENTATION
Broker-Dealer represents that it is a registered broker-dealer under the
1934 Act, a member in good standing of the NASD, and is registered as a
broker-dealer under state law to the extent necessary to perform the duties
described in this Agreement. Broker-Dealer represents that its Registered
Representatives, who will be soliciting applications for the Registered
Products, will be duly registered representatives associated with Broker-
Dealer and that they will be representatives in good standing with
accreditation as required by the NASD to sell the Registered Products.
Broker-Dealer agrees to abide by all rules and regulations of the NASD,
including its Rules of Fair Practice, and to comply with all applicable
state and federal laws and the rules and regulations of authorized
regulatory agencies affecting the sale of the Registered Products.
IV. BROKER-DEALER OBLIGATIONS
(a) TRAINING AND SUPERVISION
Broker-Dealer has full responsibility for the training and
supervision of all Registered Representatives associated with
Broker-Dealer and any other persons who are engaged directly or
indirectly in the offer or sale of the Registered Products. Broker-
Dealer shall, during the term of this Agreement, establish and
implement reasonable procedures for periodic inspection and
supervision of sales practices of its Registered Representatives.
If a Registered Representative ceases to be a Registered
Representative of Broker-Dealer, is disqualified for continued
registration or has their registration suspended by the NASD or
otherwise fails to meet the rules and standards imposed by Broker-
Dealer, Broker-Dealer shall immediately notify such Registered
Representative that he or she is no longer authorized to solicit
applications, on behalf of the Companies, for the sale of Registered
Products. Broker-Dealer shall immediately notify Distributor of
such termination or suspension.
(b) SOLICITATION
Broker-Dealer agrees to supervise its Registered Representatives so
that they will only solicit applications in states where the
Registered Products are approved for sale in accordance with
applicable state and federal laws. Broker-Dealer shall be notified
by Companies or Distributor of the availability of the Registered
Products in each state.
(c) NO CHURNING
Broker-Dealer and any Registered Representatives shall not make any
misrepresentation or incomplete comparison of products for the
purpose of inducing a policyholder to lapse, forfeit or surrender
its insurance in favor of purchasing a Registered Product.
(d) PROSPECTUS DELIVERY AND SUITABILITY REQUIREMENTS
Broker-Dealer shall ensure that its Registered Representatives
comply with the prospectus delivery requirements under the
Securities Act of 1933. In addition, Broker-Dealer shall ensure
that its Registered Representatives shall not make recommendations
to an applicant to purchase a Registered Product in the absence of
reasonable grounds to believe that the
2
<PAGE>
purchase is suitable for such applicant, as outlined in the
suitability requirements of the 1934 Act and the NASD Rules of Fair
Practice. Broker-Dealer shall ensure that each application
obtained by its Registered Representatives shall bear evidence of
approval by one of its principals indicating that the application
has been reviewed for suitability.
(e) PROMOTIONAL MATERIAL
Broker-Dealer and its Registered Representatives are not authorized
to provide any information or make any representation in connection
with this Agreement or the solicitation of the Registered Products
other than those contained in the prospectus or other promotional
material produced or authorized by Companies or Distributor.
Broker-Dealer agrees that if it develops any promotional material
for sales, training, explanatory or other purposes in connection
with the solicitation of applications for Registered Products,
including generic advertising and/or training materials which may be
used in connection with the sale of Registered Products, it will
obtain the prior written consent of Distributor, and where
appropriate, approval of Companies, such approval not to be
unreasonably withheld.
(f) RECORD KEEPING
Broker-Dealer is responsible for maintaining the records of its
Registered Representatives. Broker-Dealer shall maintain such other
records as are required of it by applicable laws and regulations.
The books, accounts and records maintained by Broker-Dealer that
relate to the sale of the Registered Products, or dealings with the
Companies, Distributor and/or Broker-Dealer shall be maintained so
as to clearly and accurately disclose the nature and details of each
transaction.
Broker-Dealer acknowledges that all the records maintained by
Broker-Dealer relating to the solicitation, service or sale of the
Registered Products subject to this Agreement, including but not
limited to applications, authorization cards, complaint files and
suitability reviews, shall be available to Companies and Distributor
upon request during normal business hours. Companies and
Distributor may retain copies of any such records which Companies
and Distributor, in their discretion, deems necessary or desirable
to keep.
(g) REFUND OF COMPENSATION
Broker-Dealer agrees to repay Companies the total amount of any
compensation which may have been paid to it within thirty (30)
business days of notice of the request for such refund should
Companies for any reason return any premium on a Registered Product
which was solicited by a Registered Representative of Broker-Dealer.
(h) PREMIUM COLLECTION
Broker-Dealer only has the authority to collect initial premiums
unless specifically set forth in the applicable commission schedule.
Unless previously authorized by Distributor, neither Broker-Dealer
nor any of its Registered Representatives shall have any right to
withhold or deduct any part of any premium it shall receive for
purposes of payment of commission or otherwise.
V. COMPANIES AND/OR DISTRIBUTOR OBLIGATIONS
(a) PROSPECTUS/PROMOTIONAL MATERIAL
Companies and/or Distributor will provide Broker-Dealer with
reasonable quantities of the currently effective prospectus for the
Registered Products and appropriate sales promotional
3
<PAGE>
material which has been filed with the NASD, and applicable state
insurance departments.
(b) COMPENSATION
Distributor will pay Broker-Dealer as full compensation for all
services rendered by Broker-Dealer under this Agreement, commissions
and/or service fees in the amounts, in the manner and for the period
of time as set forth in the Commission Schedules attached to this
Agreement or subsequently made a part hereof, and which are in
effect at the time such Registered Products are sold. The manner of
commission payments (I.E. fronted or trail) is not subject to change
after the effective date of a contract for which the compensation is
payable.
Distributor or Companies may change the Commission Schedules
attached to this Agreement at any time. Such change shall become
effective only when Distributor or Companies provide the Broker-
Dealer with written notice of the change. No such change shall
affect any contracts issued upon applications received by Companies
at Companies' Home Office prior to the effective date of such
change.
Distributor agrees to identify to Broker-Dealer for each such
payment, the name of the Registered Representative of Broker-Dealer
who solicited each contract covered by the payment. Distributor
will not compensate Broker-Dealer for any Registered Product which
is tendered for redemption after acceptance of the application. Any
chargebacks will be assessed against the Broker-Dealer of record at
the time of the redemption.
Distributor will only compensate Broker-Dealer or Affiliates, as
outlined below, for those applications accepted by Companies, and
only after receipt by Companies at Companies' Home Office or at such
other location as Companies may designate from time to time for its
various lines of business, of the required premium and compliance by
Broker-Dealer with any outstanding contract and prospectus delivery
requirements.
In the event that this Agreement terminates for fraudulent
activities or due to a material breach by the Broker-Dealer,
Distributor will only pay to Broker-Dealer or Affiliate commissions
or other compensation earned prior to discovery of events requiring
termination. No further commissions or other compensation shall
thereafter be payable.
(c) COMPENSATION PAYABLE TO AFFILIATES
If Broker-Dealer is unable to comply with state licensing
requirements because of a legal impediment which prohibits a non-
domiciliary corporation from becoming a licensed insurance agency or
prohibits non-resident ownership of a licensed insurance agency,
Distributor agrees to pay compensation to Broker-Dealer's
contractually affiliated insurance agency, a wholly-owned life
agency affiliate of Broker-Dealer, or a Registered Representative or
principal of Broker-Dealer who is properly state licensed. As
appropriate, any reference in this Agreement to Broker-Dealer shall
apply equally to such Affiliate. Distributor agrees to pay
compensation to an Affiliate subject to Affiliates agreement to
comply with the requirements of Exhibit B, attached hereto.
VI. TERMINATION
(a) This Agreement may be terminated by any party by giving thirty (30)
days' notice in writing to the other party.
(b) Such notice of termination shall be mailed to the last known address
of Broker-Dealer appearing on Companies' records, or in the event of
termination by Broker-Dealer, to the Home Office of Companies at
P.O. Box 2999, Hartford, Connecticut 06104-2999.
4
<PAGE>
(c) Such notice shall be an effective notice of termination of this
Agreement as of the time the notice is deposited in the United
States mail or the time of actual receipt of such notice if
delivered by means other than mail.
(d) This Agreement shall automatically terminate without notice upon the
occurrence of any of the events set forth below:
(1) Upon the bankruptcy or dissolution of Broker-Dealer.
(2) When and if Broker-Dealer commits fraud or gross negligence in the
performance of any duties imposed upon Broker-Dealer by this
Agreement or wrongfully withholds or misappropriates, for Broker-
Dealer's own use, funds of Companies, its policyholders or
applicants.
(3) When and if Broker-Dealer materially breaches this Agreement or
materially violates state insurance or Federal securities laws and
administrative regulations of a state in which Broker-Dealer
transacts business.
(4) When and if Broker-Dealer fails to obtain renewal of a necessary
license in any jurisdiction, but only as to that jurisdiction.
(e) The parties agree that on termination of this Agreement, any
outstanding indebtedness to Companies shall become immediately due
and payable.
VII. GENERAL PROVISIONS
(a) COMPLAINTS AND INVESTIGATIONS
Broker-Dealer shall cooperate with Distributor and Companies in the
investigation and settlement of all complaints or claims against
Broker-Dealer and/or Distributor or Companies relating to the
solicitation or sale of the Registered Products under this
Agreement. Broker-Dealer, Distributor and Companies each shall
promptly forward to the other any complaint, notice of claim or
other relevant information which may come into either one's
possession. Broker-Dealer, Distributor and Companies agree to
cooperate fully in any investigation or proceeding in order to
ascertain whether Broker-Dealer's, Distributor's or Companies'
procedures with respect to solicitation or servicing is consistent
with any applicable law or regulation.
In the event any legal process or notice is served on Broker-Dealer
in a suit or proceeding against Distributor or Companies, Broker-
Dealer shall forward forthwith such process or notice to Companies
at its Home Office in Hartford, Connecticut, by certified mail.
(b) WAIVER
The failure of Distributor or Companies to enforce any provisions of
this Agreement shall not constitute a waiver of any such provision.
The past waiver of a provision by Distributor or Companies shall not
constitute a course of conduct or a waiver in the future of that
same provision.
(c) INDEMNIFICATION
Broker-Dealer shall indemnify and hold Distributor and Companies
harmless from any liability, loss or expense sustained by Companies
or the Distributor (including reasonable attorney fees) on account
of any acts or omissions by Broker-Dealer or persons employed or
appointed by Broker-Dealer, except to the extent Companies' or
Distributor's acts or omissions caused such
5
<PAGE>
liability Indemnification by Broker-Dealer is subject to the
conditions that Distributor or Companies promptly notify Broker-
Dealer of any claim or suit made against Distributor or Companies,
and that Distributor or Companies allow Broker-Dealer to make such
investigation, settlement, or defense thereof as Broker-Dealer deems
prudent. Broker-Dealer expressly authorizes Companies to charge
against all compensation due or to become due to Broker-Dealer under
this Agreement any monies paid or liabilities incurred by Companies
under this Indemnification provision.
Distributor and Companies shall indemnify and hold Broker-Dealer
harmless from any liability, loss or expense sustained by the
Broker-Dealer (including reasonable attorney fees) on account of any
acts or omissions by Distributor or Companies, except to the extent
Broker-Dealer's acts or omissions caused such liability.
Indemnification by Distributor or Companies is subject to the
condition that Broker-Dealer promptly notify Distributor or
Companies of any claim or suit made against Broker-Dealer, and that
Broker-Dealer allow Distributor or Companies to make such
investigation, settlement, or defense thereof as Distributor or
Companies deems prudent.
(d) ASSIGNMENT
No assignment of this Agreement, or commissions payable hereunder,
shall be valid unless authorized in writing by Distributor. Every
assignment shall be subject to any indebtedness and obligation of
Broker-Dealer that may be due or become due to Companies and any
applicable state insurance regulations pertaining to such
assignments.
(e) OFFSET
Companies may at any time deduct, from any monies due under this
Agreement, every indebtedness or obligation of Broker-Dealer to
Companies or to any of its affiliates.
(f) CONFIDENTIALITY
Companies, Distributor and Broker-Dealer agree that all facts or
information received by any party related to a contract owner shall
remain confidential, unless such facts or information is required to
be disclosed by any regulatory authority or court of competent
jurisdiction.
(g) PRIOR AGREEMENTS
This Agreement terminates all previous agreements, if any, between
Companies, Distributor and Broker-Dealer. However, the execution of
this Agreement shall not affect any obligations which have already
accrued under any prior agreement.
(h) CHOICE OF LAW
This Agreement shall be governed by and construed in accordance with
the laws of the State of Connecticut.
By executing this Broker-Dealer Sales and Supervision Agreement Specifications
Page, Broker-Dealer acknowledges that it has read this Agreement in its entirety
and is in agreement with the terms and conditions outlining the rights of
Distributor, Companies and Broker-Dealer and Affiliates under this Agreement.
IN WITNESS WHEREOF, the undersigned parties have executed this Agreement to be
effective as set forth above, upon the later of the execution date below or
approval of Distributor's registration by all appropriate state securities
commissions.
6
<PAGE>
BROKER-DEALER HARTFORD SECURITIES DISTRIBUTION
COMPANY INC.
By: By:
Title: Title:
Date: Date:
AFFILIATE (IF APPLICABLE) HARTFORD LIFE INSURANCE COMPANY
By: By:
Title: Title:
Date: Date:
ITT HARTFORD LIFE AND ANNUITY
INSURANCE COMPANY
By:
Title:
Date:
7
<PAGE>
EXHIBIT B
In accordance with Section V.(c) of the Broker-Dealer-Dealer Sales and
Supervision Agreement, no compensation is payable unless Broker-Dealer and
Registered Representative have first complied with all applicable state
insurance laws, rules and regulations. Distributor must ensure that any Broker-
Dealer with whom Distributor intends to enter into an Agreement and any
Registered Representatives meet the licensing and registration requirements of
the state(s) Broker-Dealer operates in and the NASD.
Companies are required by the Insurance Department in all 50 states to pay
compensation only to individuals and entities that are properly insurance
licensed and appointed. For registered products, Distributor must also comply
with NASD regulations that require Distributor to pay compensation to an NASD
registered Broker-Dealer. Distributor must comply with both state and NASD
requirements.
Distributor requires confirmation that Broker-Dealer holds current state
insurance licenses or markets insurance products through a contractual affiliate
or wholly owned life agency, which is properly insurance licensed. If Broker-
Dealer is properly state licensed then compensation may be paid to Broker-Dealer
in compliance with both state and NASD requirements.
If Broker-Dealer is not state insurance licensed and relies on the licensing of
a contractual affiliate or wholly owned life agency, the SEC has issued a number
of letters indicating that, under specific limited circumstances, it will take
"no action" against insurers (Distributor) paying compensation on registered
products to Broker-Dealer's contractual affiliate or wholly owned life agency.
At the request of Broker-Dealer, Distributor will provide copies of several of
these letters as well as a summary of their requirements.
If Broker-Dealer intends to rely on one of these "no-action" letters, legal
counsel for Broker-Dealer must confirm to Distributor in writing that all of the
circumstances of any one of the SEC no-action letters are applicable. Broker-
Dealer's counsel must summarize each point upon which the no-action relief was
granted and represent that Broker-Dealer's method of operation is identical or
meets the same criteria. Broker-Dealer's counsel must also confirm that, to the
best of counsel's knowledge, the SEC has not rescinded or modified its no-action
position since the letter was released.
The Broker-Dealer Sales and Supervision Agreement will not be finalized and no
new applications for registered products will be accepted or no new compensation
will be payable unless the appropriate proof of state licensing or no-action
relief is confirmed. In addition to a letter from Broker-Dealer's counsel,
copies of the following documentation is required:
-- life insurance licenses for all states in which Broker-Dealer holds
these licenses and intends to operate and/or;
-- life insurance licenses for any contractual affiliate or wholly owned
life agency; and
-- the SEC No-Action Letter that will be relied upon.
If you have any questions regarding these matters, please contact your Life
Licensing and Contracting representative.
8
<PAGE>
ITT HARTFORD LIFE AND ANNUITY INSURANCE COMPANY
HARTFORD, CONNECTICUT 06104-2999
(A STOCK INSURANCE COMPANY)
(THE "COMPANY")
NATIONAL SERVICE CENTER ADDRESS:
P.O. BOX 59179
MINNEAPOLIS, MINNESOTA 55459
Will pay the Death Proceeds to the Beneficiary, upon receipt at Our National
Service Center in Minneapolis, Minnesota, of due proof of the Insured's death
while the Policy was in force.
Signed for the Company
/s/ Lynda Godkin /s/ Lowndes A. Smith
Lynda Godkin, SECRETARY Lowndes A. Smith, PRESIDENT
READ YOUR POLICY CAREFULLY
This is a legal contract between You and Us
RIGHT TO EXAMINE POLICY
WE WANT YOU TO BE SATISFIED WITH THE POLICY YOU HAVE PURCHASED. WE URGE YOU TO
EXAMINE IT CLOSELY. IF, FOR ANY REASON YOU ARE NOT SATISFIED, YOU MAY DELIVER
OR MAIL THE POLICY TO US OR TO THE AGENT FROM WHOM IT WAS PURCHASED ANYTIME
DURING YOUR FREE LOOK PERIOD. YOUR FREE LOOK PERIOD BEGINS ON THE DAY YOU GET
YOUR POLICY AND ENDS ON THE LATEST OF: (A) TEN DAYS AFTER YOU GET IT, (B) 45
DAYS AFTER YOU SIGN THE APPLICATION, AND (C) TEN DAYS AFTER WE MAIL YOU THE
NOTICE OF WITHDRAWAL RIGHT. IN SUCH AN EVENT, THE POLICY WILL BE RESCINDED AND
WE WILL PAY AN AMOUNT EQUAL TO THE GREATER OF THE PREMIUMS PAID FOR THE POLICY
LESS ANY INDEBTEDNESS OR THE SUM OF: I) THE ACCOUNT VALUE LESS ANY INDEBTEDNESS,
ON THE DATE THE RETURNED POLICY IS RECEIVED BY US OR TO THE AGENT FROM WHOM IT
WAS PURCHASED; AND, II) ANY DEDUCTIONS UNDER THE POLICY OR CHARGES ASSOCIATED
WITH THE SEPARATE ACCOUNT.
CASH SURRENDER VALUE PAYABLE ON THE SCHEDULED MATURITY DATE,
UNLESS EXTENDED BY RIDER
DEATH PROCEEDS PAYABLE AT DEATH
ADJUSTABLE DEATH BENEFIT
PREMIUMS PAYABLE AS SHOWN ON PAGE 3
NON-PARTICIPATING
THE PORTIONS OF THE ACCOUNT VALUES PROVIDED BY THIS CONTRACT THAT ARE IN THE
SUB-ACCOUNTS ARE BASED ON THE INVESTMENT EXPERIENCE OF A SEPARATE ACCOUNT. THEY
ARE VARIABLE AND NOT GUARANTEED AS TO FIXED DOLLAR AMOUNT. THE AMOUNT OF THE
DEATH BENEFIT MAY BE FIXED OR VARIABLE DEPENDING ON THE INVESTMENT EXPERIENCE OF
THAT SEPARATE ACCOUNT. THE FACE AMOUNT IS A GUARANTEED DEATH BENEFIT DURING THE
FIRST TEN POLICY YEARS SUBJECT TO THE CONDITIONS DESCRIBED ON PAGE 13.
FLEXIBLE PREMIUM
VARIABLE LIFE INSURANCE POLICY
[logo]
<PAGE>
TABLE OF CONTENTS
PAGE
Policy Specifications 3
Definitions 5
Death Benefit 7
Increases and Decreases in Face Amount 8
Premiums 8
Valuation Provisions 10
Account Value, Cash Value
and Cash Surrender Value 10
Transfers 11
Monthly Deduction Amount 12
Lapse and Policy Grace Period 13
Reinstatement 14
Policy Loans 15
Withdrawals 16
Surrenders 16
Payments By Us 16
Taxation 16
The Contract 17
Ownership and Beneficiary 18
Exchange Option 18
Termination and Maturity Date 19
Income Settlement Options 19
Any Riders follow page 21
The Registrant hereby amends this Registration Statement on such date as may
be necessary to delay its effective date until the Registrant shall file a
further amendment which specifically states that this Registration Statement
shall become effective in accordance with Section 8(a) of the Securities Act
of 1933 or until the Registration Statement shall become effective on such
date as the Commission, acting pursuant to said Section 8(a), may determine.
Page 2
<PAGE>
POLICY SPECIFICATIONS
- ------------------------------------------------------------------------------
BASE POLICY INFORMATION
- ------------------------------------------------------------------------------
POLICY: FLEXIBLE PREMIUM VARIABLE LIFE
POLICY NUMBER: VL00001
INSURED: JOHN DOE
ISSUE AGE/SEX: 35, MALE
INSURANCE CLASS: PREFERRED
OWNER: JOHN DOE
BENEFICIARY: JANE DOE
INITIAL FACE AMOUNT: $100,000
DEATH BENEFIT OPTION: A (LEVEL OPTION)
DEATH BENEFIT GUARANTEE PERIOD: JANUARY 1, 1996 - DECEMBER 31, 2005
OPTION C LIMIT: NOT APPLICABLE
FIRST PLANNED PREMIUM: $700.00
PREMIUM MODE: ANNUAL
MONTHLY DEATH BENEFIT GUARANTEE PREMIUM: $ 84.39
POLICY DATE: JANUARY 1, 1996
DATE OF ISSUE: JANUARY 1, 1996
SCHEDULED MATURITY DATE: JANUARY 1, 2056*
* IT IS POSSIBLE THAT COVERAGE WILL EXPIRE PRIOR TO THE SCHEDULED MATURITY
DATE SHOWN WHERE PREMIUMS AND INVESTMENT EXPERIENCE ARE INSUFFICIENT TO
CONTINUE COVERAGE TO SUCH DATE. COVERAGE MAY ALSO BE AFFECTED BY CHANGES
IN THE MONTHLY DEDUCTION AMOUNT.
Page 3
<PAGE>
POLICY NUMBER: VL0000001
POLICY SPECIFICATIONS
- ------------------------------------------------------------------------------
ADDITIONAL BENEFITS AND RIDERS
- ------------------------------------------------------------------------------
TERM INSURANCE
DESIGNATED INSURED: SALLY DOE
ISSUE AGE/SEX: 60/FEMALE
INSURANCE CLASS: PREFERRED
TERM INSURANCE AMOUNT: $50,000
ISSUE CHARGE: $31.00
FIRST YEAR MONTHLY TERM INSURANCE CHARGE: $ 4.09
DATE OF ISSUE: 01/01/1996
RIDER EFFECTIVE DATE: 01/01/1996
TERMINATION DATE: 01/01/2056
- ------------------------------------------------------------------------------
WAIVER OF SPECIFIED AMOUNT DISABILITY BENEFIT
INSURED: JOHN DOE
INSURANCE CLASS: PREFERRED
SPECIFIED AMOUNT: $58.33
FIRST YEAR MONTHLY CHARGE: $ 2.33
DATE OF ISSUE: 01/01/1996
RIDER EFFECTIVE DATE: 01/01/1996
TERMINATION DATE: 01/01/2026
Page 3 (cont'd)
<PAGE>
POLICY NUMBER: VL0000001
POLICY SPECIFICATIONS
POLICY CHARGES
- ------------------------------------------------------------------------------
DEDUCTIONS FROM PREMIUM PAYMENTS
- ------------------------------------------------------------------------------
TYPE OF POLICY PERCENT OF
CHARGE YEARS PREMIUMS PAID
------ ----- -------------
GUARANTEED MAXIMUM ALL 2%
SALES CHARGES
DAC TAX CHARGE ALL [1.25%]
PREMIUM TAX CHARGE ALL [2.35%]
- ------------------------------------------------------------------------------
GUARANTEED MAXIMUM DEDUCTIONS FROM ACCOUNT VALUE
- ------------------------------------------------------------------------------
TYPE OF POLICY CHARGE OR
CHARGE YEARS PERCENT OF VALUE
------ ----- ----------------
MONTHLY ADMINISTRATIVE CHARGE 1 $25.00 PER MONTH
2-10 $10.00 PER MONTH
11+ $7.50 PER MONTH
MORTALITY AND EXPENSE 1-10 .067% PER MONTH (.80%
RISK CHARGE PER YEAR) OF SEPARATE
ACCOUNT VALUE
11+ .042% PER MONTH (.50%
PER YEAR) OF SEPARATE
ACCOUNT VALUE
TRANSFER CHARGE ALL $0.00 FOR THE FIRST
TRANSFER IN ANY
CALENDAR MONTH
ALL $25.00 PER TRANSFER IN
EXCESS OF 1 PER
CALENDAR MONTH
- ------------------------------------------------------------------------------
MAXIMUM SURRENDER CHARGES *
- ---------------------------
POLICY MAXIMUM POLICY MAXIMUM
YEAR CHARGE YEAR CHARGE
1 $1000.00 9 $636.00
2 1000.00 10 545.00
3 1000.00 11 455.00
4 1000.00 12 364.00
5 1000.00 13 273.00
6 909.00 14 182.00
7 818.00 15 91.00
8 727.00 16+ 0.00
* SURRENDER CHARGES WILL BE REDUCED AS THE RESULT OF ANY PRIOR SURRENDER
CHARGES ASSESSED.
Page 3A
<PAGE>
POLICY NUMBER: VL0000001
POLICY SPECIFICATIONS
ACCOUNT VALUE INFORMATION
- ------------------------------------------------------------------------------
FIXED ACCOUNT
- ------------------------------------------------------------------------------
FIXED ACCOUNT MINIMUM CREDITED RATE: 4%
- ------------------------------------------------------------------------------
SUB-ACCOUNTS AND FUNDS
- ------------------------------------------------------------------------------
LISTED BELOW ARE THE SUB-ACCOUNTS OF THE HARTFORD LIFE INSURANCE COMPANY
SEPARATE [ACCOUNT VL I] AND THE FUNDS THEY INVEST IN.
SUB-ACCOUNT FUND
[HARTFORD BOND HARTFORD BOND FUND, INC.
HARTFORD STOCK HARTFORD STOCK FUND, INC.
HARTFORD MONEY MARKET HVA MONEY MARKET FUND, INC.
HARTFORD ADVISERS HARTFORD ADVISERS FUND, INC.
HARTFORD CAPITAL APPRECIATION HARTFORD CAPITAL APPRECIATION FUND, INC.
HARTFORD MORTGAGE SECURITIES HARTFORD MORTGAGE SECURITIES FUND, INC.
HARTFORD INDEX HARTFORD INDEX FUND, INC.
HARTFORD INTERNATIONAL HARTFORD INTERNATIONAL
OPPORTUNITIES OPPORTUNITIES FUND, INC.
HARTFORD DIVIDEND & GROWTH HARTFORD DIVIDENDS & GROWTH FUND, INC.
PUTNAM GLOBAL GROWTH PCM GLOBAL GROWTH FUND
PUTNAM GROWTH AND INCOME PCM GROWTH AND INCOME FUND
PUTNAM HIGH YIELD PCM HIGH YIELD FUND
PUTNAM MONEY MARKET PCM MONEY MARKET FUND
PUTNAM GLOBAL ASSET ALLOCATION PCM GLOBAL ASSET ALLOCATION FUND
PUTNAM U.S. GOVERNMENT AND PCM U.S. GOVERNMENT AND
HIGH QUALITY BOND HIGH QUALITY FUND
PUTNAM VOYAGER PCM VOYAGER FUND
PUTNAM UTILITIES GROWTH AND INCOME PCM UTILITIES GROWTH AND INCOME FUND
PUTNAM DIVERSIFIED INCOME PCM DIVERSIFIED INCOME FUND
PUTNAM NEW OPPORTUNITIES PCM NEW OPPORTUNITIES FUND
FIDELITY ASSET MANAGER ASSET MANAGER PORTFOLIO OF VARIABLE
INSURANCE PRODUCTS FUND II
FIDELITY OVERSEAS OVERSEAS PORTFOLIO OF VARIABLE
INSURANCE PRODUCTS FUND
FIDELITY EQUITY INCOME EQUITY-INCOME PORTFOLIO OF VARIABLE
INSURANCE PRODUCTS FUND]
AND OTHER SUB-ACCOUNTS AND FUNDS AS MAY BE MADE AVAILABLE FROM TIME TO TIME.
INITIAL ALLOCATION
OF NET PREMIUMS: HARTFORD MONEY MARKET SUB-ACCOUNT 100%
Page 3B
<PAGE>
POLICY NUMBER: VL0000001
POLICY SPECIFICATIONS
- ------------------------------------------------------------------------------
TABLE OF MINIMUM DEATH BENEFIT PERCENTAGES
AND MONTHLY MAXIMUM COST OF INSURANCE RATES PER $1,000
- ------------------------------------------------------------------------------
MINIMUM MAXIMUM COST MINIMUM MAXIMUM COST
ATTAINED DEATH BENEFIT OF INSURANCE ATTAINED DEATH BENEFIT OF INSURANCE
AGE PERCENTAGES RATE AGE PERCENTAGES RATE
36 250.00 0.1517 66 119.00 2.0517
37 250.00 0.1617 67 118.00 2.2633
38 250.00 0.1725 68 117.00 2.4933
39 250.00 0.1842 69 116.00 2.7483
40 250.00 0.1983 70 115.00 3.0367
41 243.00 0.2133 71 113.00 3.3658
42 236.00 0.2292 72 111.00 3.7458
43 229.00 0.2467 73 109.00 4.1758
44 222.00 0.2658 74 107.00 4.6483
45 215.00 0.2875 75 105.00 5.1533
46 209.00 0.3108 76 105.00 5.6867
47 203.00 0.3358 77 105.00 6.2442
48 197.00 0.3633 78 105.00 6.8292
49 191.00 0.3933 79 105.00 7.4600
50 185.00 0.4275 80 105.00 8.1567
51 178.00 0.4667 81 105.00 8.9375
52 171.00 0.5117 82 105.00 9.8183
53 164.00 0.5633 83 105.00 10.7950
54 157.00 0.6208 84 105.00 11.8483
55 150.00 0.6850 85 105.00 12.9542
56 146.00 0.7550 86 105.00 14.0983
57 142.00 0.8292 87 105.00 15.2633
58 138.00 0.9117 88 105.00 16.4442
59 134.00 1.0042 89 105.00 17.6575
60 130.00 1.1075 90 105.00 18.9208
61 128.00 1.2225 91 104.00 20.2633
62 126.00 1.3550 92 103.00 21.7350
63 124.00 1.5050 93 102.00 23.4792
64 122.00 1.6717 94 101.00 25.8192
65 120.00 1.8542
THE MINIMUM DEATH BENEFIT PERCENTAGES ARE DETERMINED TO COMPLY WITH SECTION 7702
OF THE INTERNAL REVENUE CODE, OR YOUR REQUESTED PERCENTAGES, IF GREATER. THE
MAXIMUM COST OF INSURANCE RATES DO NOT EXCEED THE COST OF INSURANCE RATES BASED
ON THE 1980 COMMISSIONERS STANDARD ORDINARY SMOKER OR NONSMOKER MORTALITY TABLE,
AGE LAST BIRTHDAY.
Page 3C
<PAGE>
POLICY NUMBER: VL0000001
RIDER SPECIFICATIONS
DESIGNATED INSURED: SALLY DOE
- ------------------------------------------------------------------------------
TERM INSURANCE
TABLE OF MONTHLY MAXIMUM RATES
(PER $1,000 OF RIDER BENEFIT)
- ------------------------------------------------------------------------------
ATTAINED MAXIMUM ATTAINED MAXIMUM
AGE RATE AGE RATE
61 $0.7975 81 $6.4175
62 0.8742 82 7.2050
63 0.9683 83 8.0933
64 1.0742 84 9.0725
65 1.1883 85 10.1317
66 1.3067 86 11.2633
67 1.4275 87 12.4658
68 1.5525 88 13.7400
69 1.6917 89 15.0958
70 1.8550 90 16.5442
71 2.0542 91 18.1183
72 2.2983 92 19.8775
73 2.5908 93 21.9458
74 2.9275 94 24.6025
75 3.3033
76 3.7100
77 4.1458
78 4.6175
79 5.1400
80 5.7342
THE MONTHLY MAXIMUM RATES DO NOT EXCEED THE COST OF INSURANCE RATES BASED ON THE
1980 COMMISSIONERS STANDARD ORDINARY SMOKER OR NONSMOKER MORTALITY TABLE, AGE
LAST BIRTHDAY.
Page 4
<PAGE>
POLICY NUMBER: VL0000001
RIDER SPECIFICATIONS
- ------------------------------------------------------------------------------
WAIVER OF SPECIFIED AMOUNT DISABILITY
TABLE OF MONTHLY MAXIMUM RATES
(PER $1 OF MONTHLY BENEFIT)
- ------------------------------------------------------------------------------
ATTAINED MAXIMUM ATTAINED MAXIMUM
AGE RATE AGE RATE
36 0.040 51 0.070
37 0.041 52 0.075
38 0.041 53 0.079
39 0.042 54 0.084
40 0.043 55 0.088
41 0.044 56 0.103
42 0.044 57 0.120
43 0.045 58 0.137
44 0.046 59 0.157
45 0.046 60 0.069
46 0.050 61 0.063
47 0.053 62 0.051
48 0.057 63 0.055
49 0.061 64 0.058
50 0.066
THE MONTHLY MAXIMUM RATES DO NOT EXCEED THE COST OF INSURANCE RATES BASED ON THE
1980 COMMISSIONERS STANDARD ORDINARY SMOKER OR NONSMOKER MORTALITY TABLE, AGE
LAST BIRTHDAY.
Page 4A
<PAGE>
DEFINITIONS The definitions in this section apply to the
following words and phrases whenever and wherever they appear in
the Policy.
ACCOUNT VALUE: the total of all amounts in the Fixed Account,
Loan Account and Sub-Accounts.
ACCUMULATION UNIT: an accounting unit used to calculate the
value of a Sub-Account.
ATTAINED AGE: the Issue Age plus the number of completed Policy
Years.
CASH SURRENDER VALUE: the Cash Value less all Indebtedness.
CASH VALUE: the Account Value less any applicable Surrender
Charges.
COMPANY, WE, US, OUR: the Company referred to on the first page
of the Policy.
CUMULATIVE DEATH BENEFIT GUARANTEE PREMIUM: the premium
required to maintain the Death Benefit Guarantee.
DATE OF ISSUE: the date shown on Page 3 from which Suicide and
Incontestability provisions are measured. The date may be
different from the Policy Date.
DEATH BENEFIT: on the Policy Date, the Death Benefit equals the
Face Amount. Thereafter, it may change in accordance with the
terms of the Death Benefit Option provision, the Minimum Death
Benefit provision, the Death Benefit Guarantee provision and the
Withdrawals provision.
DEATH BENEFIT OPTION: the Death Benefit Option in effect
determines how the Death Benefit is calculated. The three Death
Benefit Options provided are described in the Death Benefit
section.
DEATH PROCEEDS: the amount which We will pay on the death of
the Insured.
FACE AMOUNT: an amount We use to determine the Death Benefit.
On the Policy Date, the Face Amount equals the Initial Face
Amount shown on Page 3. Thereafter, it may change in accordance
with the terms of the Increases and Decreases in Face Amount
provision and the Withdrawals provision.
FIXED ACCOUNT: part of the Company's General Account to which
all or a portion of the Account Value may be allocated.
FUNDS: the registered open end management investment companies
in which the assets of the Separate Account may be invested.
GENERAL ACCOUNT: all Company assets other than those allocated
to the separate accounts.
GRACE PERIOD: The 61 day period between the day Your policy
goes into default and the day on which Your policy terminates.
INDEBTEDNESS: all loans taken on the Policy, plus any interest
due or accrued minus any loan repayments.
INSURED: the person whose life is insured under the Policy as
shown on Page 3.
IN WRITING: in a written form satisfactory to Us.
Page 5
<PAGE>
DEFINITIONS ISSUE AGE: as of the Policy Date, the Insured's
(continued) age on his/her last birthday.
LOAN ACCOUNT: an account established for any amounts
transferred from the Fixed Account and Sub-Accounts as a result
of loans. The amounts in the Loan Account are credited with
interest and are not subject to the investment experience of any
Sub-Accounts.
MONTHLY ACTIVITY DATE: the Policy Date and the same date in
each succeeding month as the Policy Date. However, whenever the
Monthly Activity Date falls on a date other than a Valuation
Day, the Monthly Activity Date will be deemed to be the next
Valuation Day.
NET PREMIUM: the amount of premium credited to the Account
Value. It is the premium paid minus the deductions from premium
shown on Page 3A.
PLANNED PREMIUM: the amount that the Owner intends to pay. The
First Planned Premium is shown on Page 3.
POLICY ANNIVERSARY: an anniversary of the Policy Date.
POLICY GRACE PERIOD: the 61 day period between the day Your
policy goes into default and the day on which Your policy
terminates.
POLICY DATE: the date shown on Page 3 from which Policy
Anniversaries and Policy Years are determined.
POLICY YEARS: years as measured from the Policy Date.
PRO RATA BASIS: an allocation method based on the proportion of
the Account Value in the Fixed Account and each Sub-Account.
SCHEDULED MATURITY DATE: the date, shown on Page 3, on which
the Policy will mature, unless extended by rider.
SEPARATE ACCOUNT: an account entitled Separate Account VL I
which has been established by Us to separate the assets funding
the variable benefits for the class of contracts to which the
Policy belongs from the other assets of the Company. Separate
Account VL I will offer the Funds listed on Page 3B as its
underlying investments.
SUB-ACCOUNTS: the subdivisions of the Separate Account. These
are shown on Page 3B.
SURRENDER CHARGE: a charge that may be assessed if You
surrender the Policy or the Face Amount is decreased.
VALUATION DAY: the date on which a Sub-Account is valued. This
occurs everyday We are open and the New York Stock Exchange is
open for trading.
VALUATION PERIOD: the period of time between the close of
business on successive Valuation Days.
YOU, YOUR: the Owner of the Policy.
Page 6
<PAGE>
DEATH BENEFIT GENERAL
Upon receipt of due proof of the Insured's death, We will pay
the Death Proceeds to the Beneficiary.
DEATH PROCEEDS
Death Proceeds equal the Death Benefit described below less
Indebtedness and less any due and unpaid Monthly Deduction
Amounts occurring during a Policy Grace Period.
However, if the Insured dies after We receive a request In
Writing from You to surrender the Policy, the Cash Surrender
Value will be paid in lieu of the Death Proceeds.
The Death Benefit is the greater of:
(a) the Death Benefit provided by the Death Benefit Option
chosen; and
(b) the Minimum Death Benefit described below.
DEATH BENEFIT OPTIONS
You have three Death Benefit Options.
1. Under Option A (Level Option), the Death Benefit is the
Face Amount on the date We receive due proof of the
Insured's death.
2. Under Option B (Return of Account Value Option), the
Death Benefit is the Face Amount, plus the Account Value
on the date We receive due proof of the Insured's death.
3. Under Option C (Return of Premium Option), the Death
Benefit is the Face Amount on the date of the Insured's
death, plus the lesser of: (a) the sum of the premiums
paid up to the date We receive due proof of the Insured's
death; and (b) the Option C Limit shown on Page 3.
DEATH BENEFIT OPTION CHANGES
You may change Your Death Benefit Option, subject to the
conditions described here. You must notify Us In Writing of the
change. Such change will be effective on the Monthly Activity
Date following the date We receive the request.
You may change Option C (Return of Premium Option) or Option B
(Return of Account Value Option) to Option A (Level Option). If
You do, the Face Amount will become that amount available as a
Death Benefit immediately prior to the option change. You may
change Option A (Level Option) or Option C (Return of Premium
Option) to Option B (Return of Account Value Option). If You
do, the Face Amount will become that amount available as a Death
Benefit immediately prior to the option change, reduced by the
then current Account Value. Any resulting decrease in the Face
Amount may be subject to a partial Surrender Charge as described
in the Decreases in Face Amount provision.
MINIMUM DEATH BENEFIT
We will automatically increase the Death Benefit so that it will
never be less than the Account Value multiplied by the Minimum
Death Benefit Percentage for the then current Policy Year. The
Table of Minimum Death Benefit Percentages is shown on Page 3C.
This is to ensure that:
(a) the Policy continues to qualify as life insurance under
the Internal Revenue Code; or
(b) the Policy maintains the relationship between the
Account Value and the Death Benefit You selected on Your
application, if greater.
Page 7
<PAGE>
INCREASES AND GENERAL
DECREASES IN At any time after the first Policy Year, You may make a request
FACE AMOUNT In Writing to change the Face Amount.
The minimum amount by which the Face Amount can be increased or
decreased is based on Our rules then in effect.
We reserve the right to limit You to one increase or decrease in
any 12 month period.
DECREASES IN FACE AMOUNT
A decrease in the Face Amount will be effective on the Monthly
Activity Date following the date We receive Your request. The
remaining Face Amount must not be less than Our minimum rules
then in effect.
If You decrease Your Face Amount to an amount lower than it has
ever been, a partial Surrender Charge may be assessed.
The Surrender Charge assessed will be:
(a) the Surrender Charge applicable to the then current Policy
Year, if any; multiplied by
(b) the percentage described below.
The percentage will be determined by:
(i) subtracting the requested Face Amount from the lowest Face
Amount prior to the request; and
(ii) dividing that difference by the lowest Face Amount prior
to the request.
The Surrender Charge assessed will be deducted from Your Account
Value on the Monthly Activity Date on which the decrease becomes
effective. We will also reduce the Surrender Charges applicable
to future Policy Years and provide You a revised schedule of
Maximum Surrender Charges.
INCREASES IN FACE AMOUNT
All requests to increase the Face Amount must be applied for on
a new application and accompanied by the Policy. All requests
will be subject to evidence of insurability satisfactory to Us.
Any increase approved by Us will be effective on the date shown
on the new policy specifications page, provided that the Monthly
Deduction Amount for the first month after the effective date of
the increase is made.
PREMIUMS GENERAL
No insurance is effective until We receive premiums sufficient
to cover the Monthly Deduction Amount on the Policy Date. After
the first premium has been paid, subsequent premiums can be paid
at any time.
Checks must be made payable to the Company shown on the first
page of the Policy.
Checks may be sent to either:
(a) Us at the address shown on the premium notice; or
(b) Our authorized agent in exchange for a receipt signed by
Our President or Secretary and countersigned by such agent.
We will apply any amount received under the Policy as a premium
unless it is clearly marked otherwise. The premium will be
applied on the date We receive it at the address shown on the
premium notice.
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<PAGE>
PREMIUMS PLANNED PREMIUM PAYMENTS
(continued) We will send You a premium notice for the Planned Premium
payment. The notices may be sent at 12, 6, or 3 month intervals.
The First Year Planned Premium payment and premium mode You
selected are shown on Page 3. You may change the Planned Premium
payment shown on the premium notices subject to Our minimum
amount rules then in effect.
FLEXIBLE PREMIUMS
After the first premium has been paid, Your subsequent premium
payments are flexible. The actual amount and frequency of
payment will affect the Account Value and could affect the
amount and duration of insurance provided by the Policy.
You may pay additional premiums at any time prior to the
Scheduled Maturity Date subject to the Premium Limitation
provision.
PREMIUM LIMITATIONS
You may pay premiums at any time prior to the Scheduled Maturity
Date subject to the following limitations:
(a) The minimum premium that We will accept is $50.
(b) If premiums are received which would cause the Policy
to fail to meet the definition of a life insurance
contract in accordance with the Internal Revenue Code, We
reserve the right to refund the excess premium payments.
Such refunds and interest thereon will be made within 60
days after the end of a Policy Year.
(c) We reserve the right to require evidence of
insurability for any premium payment that results in an
increase in the Death Benefit greater than the amount of
the premium.
(d) Any premium received in excess of $1,000,000 is
subject to Our approval.
INITIAL PREMIUM ALLOCATION
The initial Net Premium will be allocated to the Hartford Money
Market Sub-Account on the later of:
(a) the Policy Date; and
(b) the date We receive the premium.
The Accumulated Value in the Hartford Money Market Sub-Account
will then be allocated to the Fixed Account and Sub-Accounts
according to the premium allocation You specified in the
application on the latest of:
(a) 45 days after the application is signed;
(b) 10 days after We receive the premium;
(c) 10 days after We mail You the Notice of Withdrawal Right;
and
(d) the date We receive the final requirement to put the Policy
in force.
Any additional Net Premiums received by Us prior to such date
will be allocated to the Hartford Money Market Sub-Account.
SUBSEQUENT PREMIUM ALLOCATIONS
You may change how Your premiums are allocated by notifying Us
In Writing. Subsequent Net Premiums will be allocated to the
Fixed Account and Sub-Accounts according to Your most recent
instructions, subject to the following. The number of Sub-
Accounts that the Account Value may be allocated to will be
subject to Our rules then in effect. However, it will be
guaranteed to be no fewer than 9. If We receive a premium and
Your most recent allocation instructions would violate this
requirement, We will allocate the Net Premium to the Fixed
Account and Sub-Accounts on a Pro Rata Basis.
Page 9
<PAGE>
VALUATION SUB-ACCOUNT ACCUMULATION UNITS
PROVISIONS Amounts allocated to each Sub-Account increase the number of
Accumulation Units in each Sub-Account. The number of
Accumulation Units added to each Sub-Account is determined by
dividing the amount allocated to the Sub-Account by the
dollar value of one Accumulation Unit for such Sub-Account.
Amounts taken from each Sub-Account decrease the number of
Accumulation Units in each Sub-Account. The number of
Accumulation Units subtracted from each Sub-Account is
determined by dividing the amount taken from the Sub-Account by
the dollar value of one Accumulation Unit for such Sub-Account.
The number of Your Accumulation Units will not be affected by
any subsequent change in the value of the units. The
Accumulation Unit Values in each Sub-Account may increase or
decrease daily as described below.
SUB-ACCOUNT ACCUMULATION UNIT VALUE
The Accumulation Unit Value for each Sub-Account will vary to
reflect the investment experience of the applicable Fund and
will be determined on each Valuation Day by multiplying the
Accumulation Unit Value of the particular Sub-Account on the
preceding Valuation Day by a Net Investment Factor for that Sub-
Account for the Valuation Period then ended. The Net Investment
Factor for each of the Sub-Accounts is equal to the net asset
value per share of the corresponding Fund at the end of the
Valuation Period (plus the per share amount of any dividend or
capital gain distributions paid by that Fund in the Valuation
Period then ended) divided by the net asset value per share of
the corresponding Fund at the beginning of the Valuation Period.
EMERGENCY PROCEDURE
If a national stock exchange is closed (except for holidays or
weekends) or trading is restricted due to an existing emergency
as defined by the Securities and Exchange Commission so that We
cannot value the Sub-Accounts, We may postpone all transactions
which require valuation of the Sub-Accounts until valuation is
possible. Any provision of the Policy which specifies a
Valuation Day will be superseded by the emergency procedure.
FIXED ACCOUNT
We will credit interest to amounts in the Fixed Account on a
monthly basis at rates We determine. The Fixed Account Minimum
Credited Rate is shown on Page 3B. The interest credited will
reflect the timing of amounts added to or withdrawn from the
Fixed Account.
ACCOUNT VALUE, ACCOUNT VALUE
CASH VALUE Your Account Value on the Policy Date equals the initial Net
AND CASH Premium less the Monthly Deduction Amount for the first policy
SURRENDER month.
VALUE
On each subsequent Monthly Activity Date, Your Account Value
equals:
(a) the sum of Your Accumulated Values in the Fixed Account and
Sub-Accounts; plus
(b) the value of Your Loan Account, if any; minus,
(c) the appropriate Monthly Deduction Amount.
On each Valuation Day (other than a Monthly Activity Date), Your
Account Value equals:
(a) the sum of Your Accumulated Values in the Fixed Account and
Sub-Accounts; plus
(b) the value of Your Loan Account, if any.
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<PAGE>
ACCOUNT VALUE, ACCUMULATED VALUE - FIXED ACCOUNT
CASH VALUE Your Accumulated Value in the Fixed Account equals:
SURRENDER (a) the Net Premiums allocated to it; plus
VALUE (b) amounts transferred to it from the Sub-Accounts or the Loan
(continued) Account; plus
(c) interest credited to it; minus
(d) amounts transferred out of it to the Sub-Accounts or the
Loan Account; minus
(e) any transfer charges or Surrender Charges that have been
taken from it; minus
(f) any Monthly Deduction Amounts taken from it; minus
(g) any withdrawals taken from it.
ACCUMULATED VALUE - SUB-ACCOUNTS
Your Accumulated Value in any Sub-Account equals:
(a) the number of Your Accumulation Units in that
Sub-Account on the Valuation Day; multiplied by
(b) that Sub-Account's Accumulation Unit Value on the
Valuation Day.
The number of Accumulation Units in any Sub-Account is increased
when
(a) Net Premiums are allocated to it; or
(b) amounts are transferred to it from other
Sub-Accounts, the Fixed Account or the Loan Account.
The number of Accumulation Units in any Sub-Account is decreased
when
(a) amounts are transferred out of it to other
Sub-Accounts, the Fixed Account or the Loan Account; or
(b) any transfer charges or Surrender Charges have been
taken from it; or
(c) any Monthly Deduction Amounts are taken from it; or
(d) any withdrawals are taken from it.
CASH VALUE
Your Cash Value is equal to the Account Value less any
applicable Surrender Charges. The Maximum Surrender Charges and
the Policy Years during which they will be applied are shown on
Page 3A.
CASH SURRENDER VALUE
Your Cash Surrender Value is equal to Your Cash Value minus the
Indebtedness, if any.
TRANSFERS AMOUNT AND FREQUENCY OF TRANSFERS
Upon request and as long as the Policy is in effect, You may
transfer amounts among the Fixed Account and Sub-Accounts.
We reserve the right to limit the size of transfers and
remaining balances, and to limit the number and frequency of
transfers.
RESTRICTIONS ON TRANSFERS FROM THE FIXED ACCOUNT
In addition to the conditions above, transfers from the Fixed
Account are subject to the following:
(a) the transfer must occur during the 30 day period
following each Policy Anniversary; and
(b) if the Accumulated Value in Your Fixed Account
exceeds $1,000, the amount transferred in any Policy Year
may be no larger than 25% of the Accumulated Value in the
Fixed Account on the date of transfer.
TRANSFER CHARGE
After a transfer has occurred, the Transfer Charge, as specified
on Page 3A, if any, will be deducted on a Pro Rata Basis from
the Fixed Account and Sub-Accounts.
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MONTHLY GENERAL
DEDUCTION On each Monthly Activity Date, We will deduct an amount from
AMOUNT Your Account Value to pay for the benefits provided by the
Policy. This amount is called the Monthly Deduction Amount
and equals:
(a) the Cost of Insurance; plus
(b) the Monthly Administrative Charge; plus
(c) the Mortality and Expense Risk Charge; plus
(d) the charges for additional benefits provided by rider, if
any.
The Monthly Deduction Amount will be taken on a Pro Rata Basis
from the Fixed Account and Sub-Accounts on each Monthly Activity
Date.
COST OF INSURANCE
The Cost of Insurance for any Monthly Activity Date is equal to:
(a) the Cost of Insurance Rate per $1,000; multiplied by
(b) the amount at risk; divided by
(c) $1,000.
On any Monthly Activity Date, the amount at risk equals the
Death Benefit less the Account Value on that date prior to
assessing the Monthly Deduction Amount.
COST OF INSURANCE RATE
The Cost of Insurance Rate is based on the then current Policy
Year as well as the sex, Issue Age and insurance class of the
Insured shown on the top of Page 3.
The Cost of Insurance Rates will not exceed those in the Table
of Monthly Maximum Cost of Insurance Rates shown on Page 4A.
We can use Cost of Insurance Rates that are lower than the
Monthly Maximum Cost of Insurance Rates shown on Page 4A. Rates
will be determined on each Policy Anniversary based on Our
future expectations of such factors as mortality, expenses,
interest, persistency and taxes. Any change We make will be on
a uniform basis for Insureds of the same Issue Age, sex and
insurance class and whose coverage has been in force for the
same length of time. No change in insurance class or cost will
occur on account of deterioration of the Insured's health.
MONTHLY ADMINISTRATIVE CHARGE
The Monthly Administrative Charge will not exceed the amounts
shown on Page 3A.
MORTALITY AND EXPENSE RISK CHARGE
The Mortality and Expense Risk Charge for any Monthly Activity
Date is equal to:
(a) the Mortality and Expense Risk Rate; multiplied by
(b) the sum of Your Accumulated Values in the Sub-Accounts
on the Monthly Activity Date, prior to assessing the Monthly
Deduction Amount.
Each month the Mortality and Expense Risk Rate will not exceed
that shown on Page 3A.
Page 12
<PAGE>
LAPSE AND POLICY GRACE PERIOD
POLICY During the first Policy Year, the Policy will go into default
GRACE PERIOD on any Monthly Activity Date on which the Account Value less
Indebtedness is not sufficient to cover the Monthly Deduction
Amount.
During the second Policy Year, the Policy will go into default
on any Monthly Activity Date on which the Account Value less
Indebtedness less 1/2 of the Surrender Charge for the second
Policy Year is not sufficient to cover the Monthly Deduction
Amount. The Maximum Surrender Charges are shown on Page 3A.
During the third Policy Year and thereafter the Policy will go
into default on any Monthly Activity Date if the Cash Surrender
Value is not sufficient to cover the Monthly Deduction Amount.
If the Policy goes into default, We will send You a notice
warning You that the Policy is in danger of terminating. That
notice will tell You the premium required to keep the Policy
from terminating. The premiums required will be no greater than
the amount required to pay three Monthly Deduction Amounts as of
the day the Policy Grace Period began. That notice will be
mailed both to You on the first day the Policy goes into
default, at your last known address, and to any assignee of
record.
We will keep the Policy inforce for the 61 day period following
the date Your policy goes into default. We call that period the
Policy Grace Period. However, if We have not received the
required premiums (specified in Your warning notice) by the end
of the Policy Grace Period, the Policy will terminate unless the
Death Benefit Guarantee is in effect (see the Death Benefit
Guarantee provision which follows).
If the Insured dies during the Policy Grace Period, We will pay
the Death Proceeds.
DEATH BENEFIT GUARANTEE
The Policy will remain in force at the end of the Policy Grace
Period, as long as the Death Benefit Guarantee is in effect as
described below.
The Death Benefit Guarantee is available as long as:
(a) the Policy is in the first ten Policy Years; and
(b) on each Monthly Activity Date during that period, the
cumulative premiums paid into the Policy, less Indebtedness
less withdrawals from the Policy, equal or exceed an amount
known as the Cumulative Death Benefit Guarantee Premium. We
describe below how to calculate the Cumulative Death Benefit
Guarantee Premium.
If the Death Benefit Guarantee is available and the premium
required to keep the Policy from terminating has not been paid
by the end of the Policy Grace Period:
(a) all riders will terminate; and
(b) the Death Benefit Guarantee will be in effect.
While the Death Benefit Guarantee is in effect, the Death
Benefit will be the current Face Amount, regardless of the Death
Benefit Option previously selected.
The Death Benefit Guarantee will remain in effect on each
subsequent Monthly Activity Date provided:
(a) the Policy remains in default; and
(b) the Death Benefit Guarantee is available.
If the Account Value ever should be a negative amount while the
Death Benefit Guarantee is in effect, We guarantee that Your
Account Value will never be less than zero.
Page 13
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LAPSE AND
POLICY CALCULATION OF THE CUMULATIVE DEATH BENEFIT GUARANTEE PREMIUM
GRACE PERIOD On the Policy Date, the Cumulative Death Benefit Guarantee
(continued) Premium is the Monthly Death Benefit Guarantee Premium shown
on Page 3.
On each Monthly Activity Date, the Cumulative Death Benefit
Guarantee Premium is:
(a) the Cumulative Death Benefit Guarantee Premium on the
previous Monthly Activity Date; plus
(b) the current Monthly Death Benefit Guarantee Premium. (The
initial Monthly Death Benefit Guarantee Premium is shown on
Page 3.)
If, during the Death Benefit Guarantee Period, the Face Amount
is increased or decreased, or if any riders are added, deleted
or changed, a new Monthly Death Benefit Guarantee Premium will
be calculated. We will send You notice of the new Monthly Death
Benefit Guarantee Premium which will be used in calculating the
Cumulative Death Benefit Guarantee Premium in subsequent months.
DEATH BENEFIT GUARANTEE GRACE PERIOD
If, on each Monthly Activity Date during the Death Benefit
Guarantee Period, the cumulative premiums paid into the Policy
less Indebtedness less withdrawals from the Policy, do not equal
or exceed the Cumulative Death Benefit Guarantee Premium on that
date, a Death Benefit Guarantee Grace Period of 61 days will
begin. We will mail the Owner and any assignee written notice
of the amount of premium required to continue the Death Benefit
Guarantee.
The Death Benefit Guarantee will be removed from the Policy if
the required premium is not paid by the end of the Death Benefit
Guarantee Grace Period. You will receive a written notification
of the change and the Death Benefit Guarantee will never again
be available or in effect on the Policy.
REINSTATEMENT Unless the Policy has been surrendered for its Cash Surrender
Value, the Policy may be reinstated prior to the Scheduled
Maturity Date provided:
(a) You make Your request In Writing within five years from
the Termination Date;
(b) satisfactory evidence of insurability is submitted;
(c) any Indebtedness at the time of termination must be
repaid or carried over to the reinstated policy; and
(d) You pay sufficient premium to:
(i) cover all Monthly Deduction Amounts that are due
and unpaid during the Policy Grace Period; and
(ii) keep the Policy in force for 3 months after the
date of reinstatement.
The Account Value on the reinstatement date will equal:
(a) the Cash Value at the time of termination; plus
(b) Net Premiums attributable to premiums paid at the time
of reinstatement; minus
(c) the Monthly Deduction Amounts that were due and unpaid
during the Policy Grace Period; plus
(d) the Surrender Charge at the time of reinstatement.
The Surrender Charge will be based on the duration from the
original Policy Date.
Page 14
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POLICY LOANS GENERAL
At any time while the Policy is in force, You may borrow against
the Policy by assigning it as sole security to Us. We may defer
granting a loan, except to pay premiums to Us, for the period
permitted by law but not more than six months.
LOAN AMOUNTS
Any new loan taken together with any existing Indebtedness may
not exceed the Cash Surrender Value on the date We grant a loan.
The minimum loan amount that We will allow is $500. Before
advancing the loan amount, We may withhold an amount sufficient
to pay interest on total Indebtedness to the end of the Policy
Year and any Monthly Deduction Amounts due on or before the next
Policy Anniversary.
Unless you specify otherwise, all loan amounts will be
transferred from the Fixed Account and the Sub-Accounts to the
Loan Account on a Pro Rata Basis.
If total Indebtedness equals or exceeds the Cash Value on any
Monthly Activity Date, the Policy will then go into default.
See the Lapse and Policy Grace Period provision for details.
CREDITED INTEREST
Any amounts in the Loan Account will be credited with interest
at a rate equal to the Fixed Account Minimum Credited Rate shown
on Page 3B.
PREFERRED LOAN
If, any time after the 10th Policy Anniversary, the Account
Value exceeds the total of all premiums paid since issue, a
Preferred Loan is available. A lower interest rate is charged
to Preferred Loans than to the rest of Your Indebtedness, if
any. (Refer to the Interest Charged on Indebtedness provision
for details.) The amount available for a Preferred Loan is the
amount by which the Account Value exceeds the total premiums
paid. The amount of Indebtedness that qualifies as a Preferred
Loan is determined on each Monthly Activity Date.
LOAN REPAYMENTS
All or part of a loan may be repaid at any time that:
(a) the Policy is in force; and
(b) the Insured is alive.
However, each repayment must be at least $50 and clearly
identified In Writing as a loan repayment.
The amount of a loan repayment will be deducted from the Loan
Account and will be allocated among the Fixed Account and Sub-
Accounts in the same percentage as premiums are allocated.
INTEREST CHARGED ON INDEBTEDNESS
The table below shows the interest rates We will charge on Your
Indebtedness.
----------------------------------------------------------------
DURING POLICY PORTION OF INTEREST RATE CHARGED
YEARS INDEBTEDNESS EQUALS THE FIXED
ACCOUNT MINIMUM
CREDITED RATE PLUS:
----------------------------------------------------------------
1-10 All Indebtedness 2%
----------------------------------------------------------------
11 and later Preferred Loans, if any 0%
Rest of Indebtedness 1%
----------------------------------------------------------------
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<PAGE>
POLICY LOANS Because the interest charged on Indebtedness may exceed the rate
(continued) credited to the Loan Account, the Indebtedness may grow faster
than the Loan Account. If this happens, any difference between
the value of the Loan Account and the Indebtedness will be
transferred on each Monthly Activity Date from the Fixed Account
and Sub-Accounts to the Loan Account on a Pro Rata Basis.
WITHDRAWALS GENERAL
You may request a withdrawal In Writing. The minimum withdrawal
allowed is $500. The maximum withdrawal is the Cash Surrender
Value less $1,000. A charge of up to $10 may be assessed for
each withdrawal. One withdrawal per calendar month is allowed.
Unless specified otherwise the withdrawal will be deducted on a
Pro Rata basis from the Fixed and Sub-Accounts.
If the Death Benefit Option then in effect is Option A (Level
Option) or Option C (Return of Premium Option), the Face Amount
will be reduced by the amount equal to the reduction in the
Account Value resulting from the withdrawal.
Any withdrawal that causes the Face Amount to fall below the
Initial Face Amount may be subject to a partial Surrender
Charge. Refer to the Decreases in Face Amount provision for an
explanation of the applicable partial Surrender Charge.
SURRENDERS GENERAL
While the Policy is in force, You may surrender the Policy to
Us. The Policy, and additional benefits provided by rider, are
then cancelled as of the day We receive Your request In Writing
or the date You request the surrender, whichever is later. We
will then pay You the Cash Surrender Value as of that date.
PAYMENTS GENERAL
BY US We will pay Death Proceeds, Cash Surrender Values,
withdrawals and loan amounts attributable to the Sub-Accounts
within 7 days after We receive all the information needed to
process the payment unless:
(a) the New York Stock Exchange is closed on other than
customary weekend and holiday closings or trading on the New
York Stock Exchange is restricted as determined by the
Securities and Exchange Commission (SEC); or
(b) an emergency exists, as determined by the SEC, as a
result of which disposal of securities is not reasonably
practicable to determine the value of the Sub-Accounts; or
(c) the SEC, by order, permits postponement for the
protection of policy owners.
DEFERRAL OF PAYMENTS FROM THE FIXED ACCOUNT
We may defer payment of any Cash Surrender Values, withdrawals
and loan amounts which are not attributable to the Sub-Accounts
for up to six months from the date of the request. If We defer
payment for more than 30 days, We will pay interest at the Fixed
Account Minimum Credited Rate.
TAXATION We do not expect to incur any federal, state or local
income tax on the earnings or realized capital gains
attributable to the Separate Account. Based upon these
expectations, no charge is being made to the Separate Account
for federal, state or local income taxes. If We incur income
taxes attributable to the Separate Account or determine that
such taxes will be incurred, We may assess a charge for taxes
against the Policy in the future.
Page 16
<PAGE>
THE CONTRACT ENTIRE CONTRACT
The Policy, the attached copy of the initial application, any
applications for reinstatement, all subsequent applications to
change the Policy, any endorsements or riders and all additional
policy information sections added to the Policy are the entire
contract. The contract is made in consideration of the
application and the payment of the initial premium. We will not
use any statement to cancel the Policy or to defend a claim
under it, unless that statement is contained in an attached
written application. All statements in the application will, in
the absence of fraud (as determined by a court of competent
jursidiction), be deemed representations and not warranties.
MODIFICATION
The only way this contract may be modified is by a written
agreement signed by Our President, or one of Our Vice
Presidents, Secretaries or Assistant Secretaries.
NON-PARTICIPATION
The Policy is non-participating. It does not share in Our
surplus earnings, so You will receive no policy dividends under
it.
MISSTATEMENT OF AGE AND/OR SEX
If on the date of death:
(a) the Issue Age of the Insured is understated; or
(b) the sex of the Insured is incorrectly stated such that
it resulted in lower Costs of Insurance,
the Death Benefit will be reduced to the Death Benefit that
would have been provided by the last Cost of Insurance charge at
the correct Issue Age and/or sex.
If on the date of death:
(a) the Issue Age of the Insured is overstated; or
(b) the sex of the Insured is incorrectly stated such that
it resulted in higher Costs of Insurance,
the Death Benefit will be adjusted by the return of all excess
Costs of Insurance prior to the date of the Insured's death.
SUICIDE
If, within 2 years from the Date of Issue, the Insured dies by
suicide, while sane or insane, Our liability will be limited to
the premiums paid less Indebtedness and less any withdrawals.
If, within 2 years from the effective date of any increase in
the Face Amount for which evidence of insurability was obtained,
the Insured dies by suicide, while sane or insane, Our liability
with respect to such increase, will be limited to the Cost of
Insurance for the increase.
INCONTESTABILITY
We cannot contest the Policy after it has been in force, during
the Insured's lifetime, for 2 years from its Date of Issue,
except for:
(a) non-payment of premium; and
(b) a rider that provides for an Incontestability period which
exceeds 2 years.
Any increase in the Face Amount for which evidence of
insurability was obtained, will be incontestable only after the
increase has been in force, during the Insured's lifetime, for 2
years from the effective date of the increase.
Page 17
<PAGE>
THE CONTRACT SEPARATE ACCOUNTS
(continued) We will have exclusive and absolute ownership and control of the
assets of Our Separate Accounts. The assets of a Fund will be
available to cover the liabilities of Our General Account only to
the extent that those assets exceed the liabilities of that
Separate Account. The assets of a Fund will be valued on each
Valuation Day. Our determination of the value of an Accumulation
Unit by the method described in the Policy will be conclusive.
ANNUAL REPORT
We will send You a report at least once each Policy Year
showing:
(a) the current Account Value, Cash Surrender Value and Face
Amount;
(b) the premiums paid, Monthly Deduction Amounts and loans
since the last report;
(c) the amount of any Indebtedness;
(d) notifications required by the provisions of the Policy; and
(e) any other information required by the Insurance
Department of the state where the Policy was delivered.
OWNERSHIP AND CHANGE OF OWNER OR BENEFICIARY
BENEFICIARY The Owner and Beneficiary will be those named
in the application until You change them. To change the Owner
or Beneficiary, notify Us In Writing while the Insured is alive.
After We receive written notice, the change will be effective as
of the date You signed such notice, whether or not the Insured
is living when We receive it. However, the change will be
subject to any payment We made or actions We may have taken
before We received the request.
ASSIGNMENT
You may assign the Policy. Until You notify Us In Writing, no
assignment will be effective against Us. We are not responsible
for the validity of any assignment.
OWNER'S RIGHTS
While the Insured is alive and no Beneficiary is irrevocably
named, You may:
(a) exercise all the rights and options that the Policy provides
or that We permit;
(b) assign the Policy; and
(c) agree with Us to any change to the Policy.
NO NAMED BENEFICIARY
If no named Beneficiary survives the Insured, then, unless the
Policy provides otherwise:
(a) You will be the Beneficiary; or
(b) if You are the Insured, Your estate will be the Beneficiary.
EXCHANGE If the Policy is in effect, You may exchange it any time during
OPTION the 24 months following its Date of Issue for a non-variable life
insurance contract offered by Us on the life of the Insured
without evidence of insurability.
The new policy will be issued by Us with an amount at risk which
equals or is less than the amount at risk in effect on the
Exchange Date. The charges and/or premiums will be based on the
same Date of Issue, Issue Age and risk classification as the
Policy.
This exchange is subject to adjustments in payments and Account
Values to reflect variances, if any, in the payments and Account
Values under the Policy and the new policy.
Page 18
<PAGE>
TERMINATION TERMINATION
AND MATURITY The Policy will terminate upon the earliest of the following
DATE events:
(a) Scheduled Maturity Date of the Policy unless extended by
rider; or
(b) surrender of the Policy; or
(c) 61 days following the date on which Indebtedness equals
or exceeds the Cash Value, unless the Cash Value subsequently
exceeds the Indebtedness; or
(d) the end of the Policy Grace Period during which premiums
sufficient for the required deductions are not paid, provided
the Death Benefit Guarantee is not in effect; or
(e) the date We receive notification In Writing of the death of
the Insured. In this event, Your Death Benefit will not be
affected by any Monthly Deduction Amounts taken after the
date of the Insured's death and before We receive due proof
of death.
SCHEDULED MATURITY DATE
The Scheduled Maturity Date is the last date on which You may
elect to pay premium. Unless extended by rider, the Policy will
terminate on this date and any Cash Surrender Value will be paid
to You.
INCOME AVAILABILITY
SETTLEMENT All or parts of the proceeds of the Policy may, instead of
OPTIONS being paid in one sum, be left with Us under any one or a
combination of the following options, subject to Our minimum
amount requirements on the date of election.
We will pay interest of at least 3 1/2% per year (or higher, if
required by state law) on the Death Proceeds from the date of
the Insured's death to the date payment is made or an Income
Settlement Option is elected. These proceeds are then no longer
subject to the investment experience of a Separate Account.
If any payee is a corporation, partnership, association,
assignee, or fiduciary, an option may be chosen only with Our
consent. Option 4 is not available to any payee whose age
exceeds 90.
DESCRIPTION OF TABLES
The options shown below and on the next page are based on
interest at a guaranteed rate of 3 1/2% per year. Payments
under Option 4 are based on mortality according to the 1983a
Individual Annuity Mortality Table, with ages set back one year.
EXCESS INTEREST
We may pay or credit excess interest of such amount and in such
manner as We determine.
DEATH OF PAYEE
If the payee dies while receiving payments under one of the
options below, We will pay the following:
(a) Any principal and accrued interest remaining unpaid under
Option 1 or 2.
(b) The value of remaining unpaid guaranteed payments, if
any, under Option 3 or 4, commuted using interest of 3 1/2%
per year.
Any such amount will be paid in one sum to the payee's estate.
Page 19
<PAGE>
INCOME OTHER OPTIONS
SETTLEMENT To convert the monthly payments shown in the tables for Options
OPTIONS 3 and 4 to quarterly, semi-annual or annual payments, multiply
(continued) by the following factors:
PAYMENT INTERVAL FACTOR
Quarterly 2.99
Semi-annual 5.96
Annual 11.81
Other options may be arranged with Our consent.
OPTION 1 - INTEREST INCOME
Payments of interest at the rate We declare, but not less than 3
1/2% per year, on the amount left under this option.
OPTION 2 - INCOME OF FIXED AMOUNT
Equal payments of the amount chosen until the amount left under
this option, with interest of not less than 3 1/2% per year, is
exhausted. The final payment will be for the balance only.
OPTION 3 - INCOME FOR FIXED PERIOD
Payments, determined from the table below, are guaranteed for
the number of years chosen. The first payment will be due on
the date proceeds are applied under this option.
MONTHLY PAYMENTS MONTHLY PAYMENTS
NUMBER PER $1,000 OF NUMBER PER $1,000 OF
OF YEARS PROCEEDS OF YEARS PROCEEDS
1 $84.65 10 $9.83
2 43.05 15 7.10
3 29.19 20 5.75
4 22.27 25 4.96
5 18.12 30 4.45
OPTION 4 - LIFE INCOME
Payments, determined from the table shown below for the option
elected, are based on the payee's sex and age nearest birthday
on the day the first payment becomes due. The first payment
will be due on the date proceeds are applied under this option.
The Life Income available are:
(a) Payments only while the payee is alive.
(b) Payment guaranteed for 10 years; then continuing while the
payee is alive.
Page 20
<PAGE>
INCOME
SETTLEMENT
OPTIONS
(continued)
MONTHLY PAYMENTS PER $1,000 OF PROCEEDS
<TABLE>
<CAPTION>
OPTION 4A OPTION 4B OPTION 4A OPTION 4B
PAYEE'S LIFE ONLY 10 YRS. CERTAIN PAYEE'S LIFE ONLY 10 YRS. CERTAIN
AGE MALE FEMALE MALE FEMALE AGE MALE FEMALE MALE FEMALE
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
20 $3.34 $3.23 $3.34 $3.23 68 $6.79 $5.79 $6.38 $5.63
25 3.44 3.31 3.43 3.30 69 7.02 5.95 6.54 5.77
30 3.56 3.40 3.56 3.40 70 7.26 6.13 6.71 5.91
35 3.71 3.51 3.71 3.51 71 7.52 6.32 6.87 6.07
40 3.91 3.66 3.90 3.65 72 7.80 6.53 7.05 6.23
45 4.17 3.84 4.14 3.84 73 8.09 6.75 7.22 6.40
50 4.49 4.08 4.44 4.07 74 8.41 6.99 7.40 6.58
51 4.56 4.14 4.51 4.12 75 8.75 7.26 7.57 6.76
52 4.64 4.20 4.58 4.18 76 9.12 7.54 7.75 6.95
53 4.72 4.26 4.66 4.24 77 9.51 7.85 7.92 7.14
54 4.80 4.32 4.74 4.30 78 9.92 8.18 8.09 7.34
55 4.89 4.39 4.82 4.36 79 10.37 8.54 8.26 7.54
56 4.99 4.46 4.91 4.43 80 10.85 8.94 8.42 7.74
57 5.09 4.54 5.00 4.51 81 11.37 9.36 8.57 7.94
58 5.20 4.62 5.10 4.58 82 11.92 9.82 8.71 8.13
59 5.32 4.71 5.20 4.66 83 12.50 10.32 8.85 8.32
60 5.44 4.80 5.31 4.75 84 13.12 10.87 8.97 8.50
61 5.57 4.90 5.42 4.84 85 13.78 11.46 9.09 8.67
62 5.71 5.00 5.54 4.93 86 14.47 12.09 9.20 8.83
63 5.86 5.11 5.67 5.03 87 15.20 12.78 9.29 8.97
64 6.02 5.23 5.80 5.14 88 15.98 13.52 9.38 9.10
65 6.20 5.36 5.94 5.25 89 16.79 14.31 9.46 9.22
66 6.38 5.49 6.08 5.37 90 17.66 15.16 9.53 9.32
67 6.58 5.64 6.23 5.50
</TABLE>
Page 21
<PAGE>
ITT HARTFORD LIFE AND ANNUITY INSURANCE COMPANY
HARTFORD, CONNECTICUT 06104-2999
(A STOCK INSURANCE COMPANY)
(THE "COMPANY")
NATIONAL SERVICE CENTER ADDRESS:
P.O. BOX 59179
MINNEAPOLIS, MINNESOTA 55459
CASH SURRENDER VALUE PAYABLE ON THE SCHEDULED MATURITY DATE,
UNLESS EXTENDED BY RIDER
DEATH PROCEEDS PAYABLE AT DEATH OF THE INSURED
ADJUSTABLE DEATH BENEFIT
PREMIUMS PAYABLE AS SHOWN ON PAGE 3
NON-PARTICIPATING
THE PORTIONS OF THE ACCOUNT VALUES PROVIDED BY THIS CONTRACT THAT ARE IN THE
SUB-ACCOUNTS ARE BASED ON THE INVESTMENT EXPERIENCE OF A SEPARATE ACCOUNT. THEY
ARE VARIABLE AND NOT GUARANTEED AS TO FIXED DOLLAR AMOUNT. THE AMOUNT OF THE
DEATH BENEFIT MAY BE FIXED OR VARIABLE DEPENDING ON THE INVESTMENT EXPERIENCE OF
THAT SEPARATE ACCOUNT. THE FACE AMOUNT IS A GUARANTEED DEATH BENEFIT DURING THE
FIRST TEN POLICY YEARS SUBJECT TO THE CONDITIONS DESCRIBED ON PAGE 13.
[LOGO]
FLEXIBLE PREMIUM
VARIABLE LIFE INSURANCE POLICY
<PAGE>
CERTIFICATE AMENDING AND RESTATING
THE CERTIFICATE OF INCORPORATION BY
ACTION OF THE BOARD OF DIRECTORS AND SHAREHOLDERS
1. The name of the Corporation is ITT HARTFORD LIFE AND ANNUITY INSURANCE
COMPANY.
2. The Certificate of Incorporation is amended and restated by the following
resolution of the Board of Directors and Shareholder of the Corporation.
RESOLVED, that the Certificate of Incorporation of the Corporation, as
supplemented and amended to date, is further amended and restated to read
as follows:
Section 1. The name of the Corporation is ITT HARTFORD LIFE AND ANNUITY
INSURANCE COMPANY.
Section 2. The address of the Registered Office of the Corporation is
Hartford Plaza, Hartford, Connecticut 06104-2999.
Section 3. The Corporation is a body politic and corporate and shall
have all the powers granted by the general statutes, as now
enacted or hereinafter amended, to corporations formed under
the Stock Corporation Act.
Section 4. The Corporation shall have the purposes and powers to write
any and all forms of insurance which any other corporation
now or hereafter chartered in Connecticut and empowered to
do an insurance business may now or hereafter lawfully do;
to accept and to cede reinsurance; to issue policies and
contracts for any kind or combination of kinds of insurance;
to issue policies or contracts either with or without
participation in profits; to acquire and hold any or all of
the shares or other securities of any insurance corporation
or any other kind of corporation; and to engage in any
lawful act or activity for which corporations may be formed
under the Stock Corporation Act. The corporation is
authorized to exercise the powers herein granted in any
state, territory or jurisdiction of the United States or in
any foreign country.
Section 5. The Corporation shall obtain a license from the insurance
commissioner prior to the commencement of business and shall
be subject to all general statutes applicable to insurance
companies.
Section 6. The aggregate number of shares which the corporation shall
have authority to issue is 3,000 shares consisting of one
class only, designated as Common Shares, of the par value of
$1,250.
Section 7. No shareholder shall, because of his ownership of shares,
have a preemptive or
<PAGE>
-2-
other right to purchase, subscribe for, or take any part of
any shares or any part of the notes, debentures, bonds, or
other securities convertible into or carrying options or
warrants to purchase shares of this corporation issued,
optioned, or sold by it after its incorporation.
Section 8. The minimum amount of stated capital with which the
corporation shall commence business is One Thousand Dollars
($1,000.00).
Section 9. So much of the charter of said corporation is amended, as is
inconsistent herewith is repealed, provided such repeal
shall not invalidate or otherwise affect any action taken
pursuant to the charter of the corporation, in accordance
with its terms, prior to the effective date of such repeal.
3. The above resolution was passed by the Board of Directors and the
Shareholder of the Corporation. The number of shares entitled to vote
thereon was 3,000 and the vote required for adoption was 2,000 shares. The
vote favoring adoption was 3,000 which was the greatest vote needed to pass
the resolution.
4. The term of existence of the corporation shall be perpetual.
Dated at Simsbury, Connecticut this 30 day of April, 1996.
--
We hereby declare, under the penalties of false statement, that the statements
made in the foregoing Certificate are true.
ITT HARTFORD LIFE AND
ANNUITY INSURANCE COMPANY
/s/ Lowndes A. Smith
-----------------------------
Lowndes A. Smith, President
/s/ Lynda Godkin
- ----------------------------------------
Lynda Godkin, Associate General Counsel
and Corporate Secretary
<PAGE>
AMENDED AND RESTATED BYLAWS
OF
ITT HARTFORD LIFE AND ANNUITY INSURANCE COMPANY
EFFECTIVE MAY 1, 1996
<PAGE>
-2-
ARTICLE I
Name - Home Office
SECTION 1. This company shall be named ITT Hartford and Annuity Life Insurance
Company.
SECTION 2. The Company may have such principal and other business offices,
either within or without the State of Connecticut, as the Board of Directors may
designate or as the business of the Company may require.
SECTION 3. The registered office of the Company is Hartford Plaza, Hartford,
Connecticut 06104-2999.
ARTICLE II
Stockholders' Meetings - Notice-Quorum-Right to Vote
SECTION 1. All meetings of the stockholders shall be held at the principal
business office of the Company unless the Board of Directors shall otherwise
provide and direct.
SECTION 2. The annual meeting of the stockholders shall be held on such day and
at such hour as the Board of Directors may decide. For cause the Board of
Directors may postpone or adjourn such annual meeting to any other time during
the year.
SECTION 3. Special meetings of the stockholders may be called by the Board of
Directors, the Executive Committee, the Chairman or Vice Chairman of the Board,
the President or any Vice President.
SECTION 4. Notice of stockholders' meetings shall be delivered to each
stockholder, either personally or by mail at his address as it appears on the
records of the Company, at least seven days prior to the meeting. The notice
shall state the place, date and time of the meeting and shall specify all
matters proposed to be acted upon at the meeting.
SECTION 5. At each annual meeting, the stockholders shall choose Directors as
hereinafter provided.
SECTION 6. Each stockholder shall be entitled to one vote at all meetings of
the Company for each share of stock held by such stockholder. Proxies may be
authorized by written power of attorney.
<PAGE>
-3-
SECTION 7. A majority of the total number of shares entitled to vote,
represented in person or by proxy, shall constitute a quorum.
SECTION 8. Each stockholder shall be entitled to a certificate of stock which
shall be signed by the President or a Vice President, and either the Treasurer
or an Assistant Treasurer of the Company, and shall bear the seal of the
Company, but such signatures and seal may be facsimile.
ARTICLE III
Directors-Meetings-Quorum
SECTION 1. The property, business and affairs of the Company shall be managed
by a board of not less than three nor more than twenty Directors, who shall be
chosen by the stockholders at each annual meeting. Vacancies occurring between
annual meetings may be filled by the affirmative vote of a majority of the
Directors then in office. Each Director shall hold office until the next annual
meeting of stockholders and until his successor is chosen and qualified.
SECTION 2. Meetings of the Board of Directors may be called by the direction of
the Chairman of the Board, the President, or any three Directors.
SECTION 3. Three days' notice of meetings of the Board of Directors shall be
given to each Director, either personally or by mail or telegraph, at his
residence or usual place of business, but notice may be waived, at any time, in
writing, and attendance of a Director at a meeting shall constitute a waiver of
notice of such meeting except where a Director attends a meeting and objects
thereat to the transaction of any business on grounds that the meeting was not
lawfully called or convened.
SECTION 4. A majority of the number of existing directorships, but not less than
two Directors, shall constitute a quorum.
ARTICLE IV
Election of Officer - Duties of Board of
Directors and Executive Committee
SECTION 1. The Board of Directors shall annually elect a President, a Secretary
and a Treasurer. It may elect a Chairman of the Board, a Vice Chairman of the
Board and such Vice Presidents, other Secretaries, Assistant Secretaries,
Assistant Treasurers and other officers as it may determine. All officer of the
Company shall hold office during the pleasure of the Board of Directors.
<PAGE>
-4-
SECTION 2. The Directors may fill any vacancy among the officers by election
for the unexpired term.
SECTION 3. The Board of Directors may appoint from its own number an
Executive Committee of not less than five Directors. The Executive Committee may
exercise all powers vested in and conferred upon the Board of Directors at any
time when the Board is not in session. A majority of the members of said
Committee shall constitute a quorum. Meetings of the Committee shall be called
whenever the Chairman of the Board, the President or a majority of its members
shall request.
SECTION 4. The Board of Directors may annually appoint from its own number a
Finance Committee of not less than three Directors, whose duties shall be as
hereinafter provided.
SECTION 5. The Board of Directors may, at any time, appoint such other
committees, not necessarily from its own number, as it may deem necessary for
the proper conduct of the business of the Company, which committees shall have
only such powers and duties as are specifically assigned to them by the Board of
Directors or the Executive Committee.
For all meetings, forty-eight hours' notice shall be given but notice may be
waived, at any time, in writing, and attendance of a Director at a meeting shall
constitute a waiver of notice of such meeting except where a Director attends a
meeting and objects thereat to the transaction of any business on grounds that
the meeting was not lawfully called or convened.
SECTION 6. The Board of Directors may authorize corporate contributions, in such
amounts as it determines to be reasonable, for public welfare or for charitable,
scientific or educational purposes, subject to the limits and restrictions
imposed by law and to such rules and regulations consistent with law as it
makes.
ARTICLE V
Officers
Chairman of the Board
and
Vice Chairman of the Board
SECTION 1. The Chairman of the Board shall preside at the meetings of the
Board of Directors and the Executive Committee and, in the absence of the
Chairman of the Finance Committee, at the meetings of the Finance Committee.
In the absence or inability of the Chairman of the Board to so preside, the Vice
Chairman shall preside in his place if there be one, otherwise the President
shall preside.
<PAGE>
-5-
SECTION 2. The Vice Chairman of the Board shall, in the absence of the Chairman
of the Board, exercise the powers and perform the duties of the Chairman of the
Board. He shall perform such other duties and have such other powers as may be
assigned to him by the Board of Directors.
President
SECTION 3. The President, unless the Board of Directors shall otherwise order
pursuant to Section 7 below, shall be the chief executive officer of the Company
and, subject to the control of the Board of Directors, shall in general
supervise and control all the business and affairs of the Company. Unless the
Board of Directors shall provide otherwise, he shall, when present, preside at
all meetings of the shareholders and shall preside at all meetings of the Board
of Directors unless the Board shall have elected a Chairman of the Board of
Directors. He shall have authority, subject to such rules as may be prescribed
by the Board of Directors, to appoint such agents and employees of the Company
as he shall deem necessary, to prescribe their powers, duties and compensation,
and to delegate authority to them. Such agents and employees shall hold office
at the discretion of the President. Except as otherwise provided in these
Bylaws or by resolution of the Board of Directors, the President shall have
authority to sign, execute and acknowledge, on behalf of the Company all
contracts, reports and other documents or instruments necessary or proper to be
executed in the course of the Company's regular business, or which shall be
authorized by resolution of the Board of Directors; and except as otherwise
provided by law or the Board of Directors, he may authorize any Vice President
or other officer or agent of the Company to sign, execute and acknowledge such
documents or instruments in his place and stead. In general, he shall perform
all duties incident to the office of the chief executive officer and such other
duties as may be prescribed by the Board of Directors from time to time.
If the President is not the chief executive officer, he shall have such duties
and authority as prescribed by the Board of Directors or the chief executive
officer.
SECTION 4. In the absence or inability of the President to perform his duties,
the Board or the Chairman thereof may designate a Vice President to exercise the
powers and perform the duties of the President during such absence or inability.
Secretary
SECTION 5. The Secretary shall keep a record of all the meetings of the
Company, of the Board of Directors and of the Executive Committee, and he shall
discharge all other duties specifically required of the Secretary by law.
<PAGE>
-6-
The other Secretaries and the Assistant Secretaries shall perform such duties as
may be assigned to them by the Board of Directors or by their senior officers
and any Secretary or Assistant Secretary may affix the seal of the Company and
attest it and the signature of any officer to any and all instruments.
Treasurer
SECTION 6. The Treasurer shall keep, or cause to be kept, full and accurate
accounts of the Company. He shall see that the funds of the Company are
disbursed as may be ordered by the Board of Directors, the Finance Committee or
a duly authorized individual. He shall have charge of all moneys paid to the
Company and shall deposit such to the credit of the Company or in any other
properly authorized name, in such banks or depositories as may be designated in
a manner provided by these Bylaws. He shall also discharge all other duties
that may be required of him by law.
Other Officers
SECTION 7. The other officers shall perform such duties as may be assigned to
them by the President or the Board of Directors. The Board of Directors may
designate the Chairman of the Board or the Vice Chairman as the chief executive
officer of the Company. In such event that person shall assume all authority,
power, duties and responsibilities otherwise appointed to the President pursuant
to Section 3 above, and all references to the President in these Bylaws shall be
regarded as references to the Chairman of the Board or Vice Chairman, as the
case may be, as such chief executive officer, except where a contrary meaning is
clearly required, and provided that in no case shall that person be empowered in
place of the President to sign the certificates for shares of stock of the
Company.
ARTICLE VI
Finance Committee
SECTION 1. If a Finance Committee is established, it shall be the duty of that
committee to supervise the investment of the funds of the Company in securities
in which insurance companies are permitted by law to invest, and all other
matters connected with the management of investments. If no Finance Committee
is established, this duty shall be performed by the Board of Directors.
SECTION 2. All loans or purchases for the investment and reinvestment of the
funds of the Company shall be submitted for approval to the Finance Committee,
if not specifically approved by the Board of Directors.
<PAGE>
-7-
SECTION 3. Sale or transfer of any stocks or bonds shall be made upon
authorization of the Finance Committee unless specifically authorized by the
Board of Directors.
SECTION 4. Transfers of stock and registered bonds, deeds, leases, releases,
sales, mortgages chattel or real, assignments or partial releases of mortgages
chattel or real, and in general all instruments of defeasance of property and
all agreements or contracts affecting the same, except discharges of mortgages
and entries to foreclose the same as hereinafter provided, shall be authorized
by the Finance Committee or the Board of Directors, and be executed jointly for
the Company by two persons, to wit: the Chairman of the Board, the Vice
Chairman, the President or a Vice President, and a Secretary, the Treasurer or
an Assistant Treasurer, but may be acknowledged and delivered by either one of
those executing the instrument; provided, however, that either a Secretary, the
Treasurer, or an Assistant Treasurer alone, when authorized as aforesaid, or any
person specially authorized by the Finance Committee as attorney for the
Company, may make entry to foreclose any mortgage, and a Secretary, the
Treasurer or an Assistant Treasurer alone is authorized, without the necessity
of further authority, to discharge by deed or otherwise any mortgage on payment
to the Company of the principal, interest and all charges due.
SECTION 5. The Finance Committee may fix times and places for regular
meetings. No notice of regular meetings shall be necessary. Reasonable notice
shall be given of special meetings but the action of a majority of the Finance
Committee at any meeting shall be valid notwithstanding any defect in the notice
of such meeting.
SECTION 6. In the absence of specific authorization from the Board of
Directors or the Finance Committee, the Chairman of the Board, the President, a
Vice President or the Treasurer shall have the power to vote or execute proxies
for voting any shares held by the Company.
ARTICLE VII
Funds
SECTION 1. All monies belonging to the Company shall be deposited to the
credit of the Company, or in such other name as the Finance Committee, the
Chairman of the Finance Committee or such executive officers as are designated
by the Board of Directors shall direct, in such bank or banks as may be
designated from time to time by the Finance Committee, the Chairman of the
Finance Committee or by such executive officers as are designated by the Board
of Directors. Such monies shall be drawn only on checks or drafts signed by any
two executive officers of the Company, provided that the Board of Directors may
authorize the withdrawal of such monies by check or draft signed with the
facsimile signature of any one or more executive officers, and provided further,
that the Finance Committee may authorize such alternative methods of withdrawal
as it deems proper.
<PAGE>
-8-
The Board of Directors, the President, the Chairman of the Finance Committee, a
Vice President, or such executive officers as are designated by the Board of
Directors may authorize withdrawal of funds by checks or drafts drawn at offices
of the Company to be signed by Managers, General Agents, or employees of the
Company, provided that all such checks or drafts shall be signed by two such
authorized persons, except checks or drafts used for the payment of claims or
losses which need to be signed by only one such authorized person, and provided
further that the Board of Directors of the Company or executive officers
designated by the Board of Directors may impose such limitations or restrictions
upon the withdrawal of such funds as it deems proper.
ARTICLE VIII
Liability and Indemnity
SECTION 1. No person shall be liable to the Company for any loss or damage
suffered by it on account of any action taken or omitted to be taken by him as
director or officer of the Company, or of any other company, partnership, joint
venture, trust or other enterprise for which he serves as a director, officer
or employee at the request of the Company, in good faith, if such person (a)
exercised and used the same degree of care and skill as a prudent man would have
exercised or used under the circumstances in the conduct of his own affairs, or
(b) took or omitted to take such action in reliance upon advice of counsel for
the Company or upon statements made or information furnished by officers or
employees of the Company which he had reasonable grounds to believe to be true.
The foregoing shall not be exclusive of other rights and defenses to which he
may be entitled as a matter of law.
SECTION 2. The Company shall indemnify any person who was or is a party or
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, (other than one by or in the right of the Company) by reason
of the fact that he is or was a director, officer or employee of the Company, or
is or was serving at the request of the Company as a director, officer or
employee of another company, partnership, joint venture, trust or other
enterprise, against expenses, including attorneys' fees, judgments, fines and
amounts paid in settlement actually and reasonably incurred by him in connection
with such action, suit or proceeding if he acted in good faith and in a manner
he reasonably believed to be in or not opposed to the best interests of the
Company, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful. The termination of any
action, suit or proceeding by judgment, order, settlement, conviction, or upon a
plea of nolo contendere or its equivalent, shall not, of itself, create a
presumption that the person did not act in good faith and in a manner which he
reasonably believed to be in or not opposed to the best interests of the
Company, and, with respect to any criminal action or proceeding had reasonable
cause to believe that his conduct was unlawful.
SECTION 3. The Company shall indemnify any person who was or is a party or is
threatened to
<PAGE>
-9-
be made a party to any threatened, pending or completed action, suit or
proceeding, by or in the right of the Company to procure a judgment in its
favor by reason of the fact that he is or was a director, officer or
employee of the Company, or is or was serving at the request of the Company as a
director, officer or employee of another company, partnership, joint venture,
trust or other enterprise against expenses, including attorneys' fees, actually
and reasonably incurred by him in connection with the defense or settlement of
such action or suit, if he acted in good faith and in a manner he reasonably
believed to be in or not opposed to the best interests of the Company, except
that no indemnification shall be made in respect of any claim, issue or matter
as to which such person shall have been adjudged to be liable for negligence or
misconduct in the performance of his duty to the Company unless and only to the
extent that the court in which such action or suit was brought shall determine
upon application that, despite the adjudication of liability and in view of all
circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses as such court shall deem proper.
SECTION 4. Expenses, including attorneys' fees, incurred in defending a civil
or criminal action, suit or proceeding may be paid by the Company in advance of
the final disposition of such action, suit or proceeding, upon receipt of an
undertaking by or on behalf of the director or employee to repay such amount
unless it shall ultimately be determined that he is entitled to be indemnified
by the Company as authorized hereby.
SECTION 5. The indemnification provided by this Article shall not be deemed
exclusive of any other rights to which those indemnified may be entitled under
any statute, bylaw, agreement, vote of shareholders or of disinterested
directors or otherwise, both as to action in an official capacity and as to
action in another capacity while holding such office, and shall continue as to a
person who has ceased to be a director, officer or employee and shall inure to
the benefit of the heirs, executors and administrators of such a person.
ARTICLE IX
Amendment of Bylaws
SECTION 1. The Directors shall have power to adopt, amend and repeal such
bylaws as may be deemed necessary or appropriate for the management of the
property and affairs of the Company.
SECTION 2. The stockholders at any annual or special meeting may amend or
repeal these bylaws or adopt new ones if the notice of such meeting contains a
statement of the proposed alteration, amendment, repeal or adoption of the
substance thereof. Bylaws amended or adopted by the stockholders may be amended
or repealed by the Directors.
<PAGE>
-10-
ARTICLE X
Term of Existence
SECTION 1. The term of existence of the corporation shall be perpetual.
This is to certify that the foregoing is a true copy of the Bylaws of ITT
Hartford Life and Annuity Insurance Company in full force and effect on this
first day of May, 1996.
Attest:
- ---------------------------------
Gregory A. Boyko
Vice President
<PAGE>
July 1, 1996
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
RE: Separate Account VL I ("Separate Account")
------------------------------------------
Flexibile Premium Variable Life Insurance Policy ("Policies")
-------------------------------------------------------------
ITT Hartford Life and Accident Insurance Company ("Company")
------------------------------------------------------------
Dear Sir/Madam:
In my capacity as General Counsel of the Company, I have supervised the
establishment of the Separate Account by the Board of Directors of the
Company as a separate account for assets applicable to Policies offered by
the Company pursuant to Connecticut law. I have participated in the
preparation of the registration statement for the Separate Account on Form
S-6 under the Securities Act of 1933 and the Investment Company Act of 1940
with respect to the Policies.
I am of the following opinion:
1. The Separate Account is a separate account of the Company validly existing
pursuant to Connecticut law and the regulations issued thereunder.
2. The assets held in the Separate Account are not chargeable with liabilities
arising out of any other business the Company may conduct.
3. The Policies are legally issued and represent binding obligations of the
Company.
In arriving at the foregoing opinion, I have made such examination of the law
and examined such records and other documents as in my opinion as are
necessary or appropriate.
I hereby consent to the filing of this opinion as an exhibit to the
registration statement under the Securities Act of 1933.
Sincerely,
/s/ Lynda Godkin
Lynda Godkin
General Counsel & Secretary
<PAGE>
July 1, 1996
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Dear Sirs;
This opinion is furnished in connection with the registration statement under
the Securities Act of 1933 as amended ("Securities Act"), of a certain
flexible premium variable life insurance policy (the "Policy") that will be
offered and sold by ITT Hartford Life and Annuity Insurance Company and
certain units of interest to be issued in connection with the Policy.
The hypothetical illustrations of the Policy used in this Registration
Statement accurately reflect reasonable estimates of projected performance of
the Policy under the stipulated rates of investment return, the contractual
expense deductions and guaranteed cost-of-insurance rates, and utilizing a
reasonable estimation for expected fund operating expenses.
I hereby consent to the use of this opinion as an exhibit to the Securities
Act Registration Statement on Form S-6 and to the reference to my name under
the heading "Experts" in the Prospectus included in the Securities Act
Registration Statement.
Very truly yours,
/s/ Ken A. McCullum
Ken A. McCullum, FSA, MAAA
Director Individual Life
Product Development
<PAGE>
HARTFORD LIFE INSURANCE COMPANY, INC.
AND
HARTFORD LIFE AND ACCIDENT INSURANCE COMPANY, INC.
POWER OF ATTORNEY
Donald R. Frahm
Bruce D. Gardner
Joseph H. Gareau
John P. Ginnetti
Thomas M. Marra
Leonard E. Odell, Jr.
Lowndes A. Smith
Raymond P. Welnicki
Lizabeth H. Zlatkus
do hereby jointly and severally authorize Lynda Godkin and/or Scott K.
Richardson to sign as their agent, any Registration Statement, pre-effective
amendment, post-effective amendment and any application for exemptive relief of
the Hartford Life Insurance Company, Inc. and Hartford Life and Accident
Insurance Company, Inc. under the Securities Act of 1933 and/or the Investment
Company Act of 1940.
IN WITNESS WHEREOF, the undersigned have executed this Power of Attorney for the
purpose herein set forth.
/s/ Donald R. Frahm Dated: 10/19/95
- ----------------------------------- ---------------------
Donald R. Frahm
/s/ Bruce D. Gardner Dated: 10/19/95
- ----------------------------------- ---------------------
Bruce D. Gardner
/s/ Joseph H. Gareau Dated: 10/19/95
- ----------------------------------- ---------------------
Joseph H. Gareau
/s/ John P. Ginnetti Dated: 10/26/95
- ----------------------------------- ---------------------
John P. Ginnetti
/s/ Thomas M. Marra Dated: 10/19/95
- ----------------------------------- ---------------------
Thomas M. Marra
/s/ Leonard E. Odell, Jr. Dated: 10/20/95
- ----------------------------------- ---------------------
Leonard E. Odell, Jr.
/s/ Lowndes A. Smith Dated: 10/19/95
- ----------------------------------- ---------------------
Lowndes A. Smith
<PAGE>
/s/ Raymond P. Welnicki Dated: 10/24/95
- ----------------------------------- ---------------------
Raymond P. Welnicki
/s/ Lizabeth H. Zlatkus Dated: 10/20/95
- ----------------------------------- ---------------------
Lizabeth H. Zlatkus
