NEW YORK
STATE VARIATIONS
VARIABLE UNIVERSAL LIFE INSURANCE
Location of Variation Description of Variation
--------------------- ------------------------
Forms 4213RNY and 4214RNY (alternate certificate covers for replacement situations)
Front Covers The free look period for replacements is within 60 days after the issue
date of the certificate and requires a return of premium. This
provision was written to return the greater of the accumulated value or
premium paid. ALSO, we cannot allocate the premium to the money market
subaccount for 65 days from the issue date. Instead, we can allocate it
to the money market subaccount until the 10-day right to cancel period
expires.
Added "Participating" as one of the descriptive points.
Added "if shown on page 3A" at the end of the descriptive point on the
Death Benefit Guarantee.
At the beginning of the second paragraph, added "If a Death Benefit
Guarantee Premium is shown on page 3A,".
Table of Certificate Provisions Revised as needed to reflect changes made to the certificate provisions.
Forms 4213ROPNY and 4214ROPNY (Adult and Juvenile Certificates)
Added form number and page numbers to each page of both forms.
Front Covers The free look provision requires a return of premium. This provision
was written to return the greater of the accumulated value or premium
paid. ALSO, we cannot allocate the premium to the money market
subaccount for 15 days from the issue date. Instead, we can allocate it
to the money market subaccount until the 10-day right to cancel period
expires.
Added "Participating" as one of the descriptive points.
Added "if shown on page 3A" at the end of the descriptive point on the
Death Benefit Guarantee.
At the beginning of the second paragraph, added "If a Death Benefit
Guarantee Premium is shown on page 3A,".
Table of Certificate Provisions Revised as needed to reflect changes made to the certificate provisions.
Certificate Specifications Pages The Death Benefit Guarantee cannot be in effect if the certificate is
issued rated Table D or higher, or if rated Table C at ages 60+. When
this happens, the message "NOT APPLICABLE" will appear on page 3A
following DEATH BENEFIT GUARANTEE PREMIUM.
Footnotes were added to provide further explanation of the Death Benefit
Guarantee Premium and the Guaranteed Minimum Fixed Account Effective
Interest Rate.
Added the minimum withdrawal amount, the guideline level premium and the
guideline single premium. Also added tables of the monthly guaranteed
maximum expense charges for each $1000 of increase in specified amount
and the guaranteed mortality rates per 1000 lives for use in calculating
paid-up single premium at attained age.
Section 1.1 Definitions Added the definition for "Certificate Year".
Section 1.2 Entire Contract Added the last sentence of the first paragraph: "The process described
in the Resolution of Disputes Section of AAL's Bylaws is optional, but
not mandatory, for resolving disputes relating to this certificate.
Added the last paragraph: "Your rights and obligations under this
certificate, or those of any person rightfully claiming under this
certificate, are governed by the laws of the State of New York."
Section 1.3 Statements in the
Application Added "and is a material misstatement" to the end of the second sentence.
Section 1.6 Misstatement of Age or Sex In the second sentence, replaced "proceeds payable" with "death benefit
payable".
Section 1.8 Suicide In the first sentence, deleted the wording "while sane or insane".
Added the last sentence: "The refund described in this section is in
lieu of the death benefit and will be paid to the beneficiary according
to the Beneficiary section of this certificate."
Section 1.9 Change of Certificate Modified this section by adding the description of two other changes
that may be made: "make changes to additional benefits and change the
death benefit option, as specified in section 2.4". Moved the paragraph
about the $25 charge to the first paragraph. Due to this change, deleted
the sentence "Other rights You have to change the certificate are
described elsewhere in the certificate."
Combined two sentences into one, from "A written application providing
proof of insurability for the change under AAL's underwriting guidelines
and policies may be required. You have the right to drop additional
benefits without proof of insurability" to "A written application
providing proof of insurability for the change will be required,
except when additional benefits are being dropped."
Section 1.10 Exchange for or
Conversion to Other Insurance Added section 1.10 which allows the owner to exchange this certificate
or convert it to a substantially comparable plan of insurance that we
offer. They are allowed to do this whenever we make a material change
in the investment policy of the separate account or during the first 18
months the certificate is in force. This must be allowed without
requiring any additional evidence of insurability. The exchange shall
be subject to an equitable premium or cash value adjustment according to
the detailed statement of the method of computing such adjustment that
was filed with the department. This is attached to this memo labeled
Appendix C. For additional details on this provision, see the
certificate.
Section 1.11 (Form 4214ROPNY ONLY)
Limitation of Insurance Added this provision describing New York's limitations in the amount of
insurance that may be issued to juveniles under age 14 years and 6
months. This provision is essentially what is found on amendment form
A-118L, which is issued on other juvenile life insurance certificates in
New York.
Section 2.4 Death Benefit Option
Change Revised the last sentence of paragraph one from "A written application
providing proof of insurability under AAL's guidelines and policies may
be required" to "A written application providing proof of insurability
under AAL's guidelines and policies will be required, if evidence
of insurability is required."
Section 2.5 Death Benefit Guarantee Added the first sentence of the first paragraph and an introduction into
the second sentence, which reads "See page 3A to determine if the Death
Benefit Guarantee is applicable. If it is,"
Added the second paragraph, which reads "As long as your death benefit
guarantee remains in effect, AAL will waive all or part of any monthly
deduction that is not covered by the cash value. Your cash value will
never become negative."
In the fourth paragraph, the third sentence, revised "For other Death
Benefit Guarantee Premiums..." to "For subsequent Death Benefit Guarantee
Premiums...". In the last sentence of this paragraph, added the word
"first" to refer to the "date of the first change".
In the sixth paragraph, added wording to tell when the notice of
insufficient premium to maintain the Death Benefit Guarantee would be
sent: "within 30 days after the certificate processing day on which we
determine an insufficiency occurred."
Section 2.6 Increases in Specified
Amount In the first paragraph, second sentence, changed "may be required" to
"will be required".
In the second paragraph, second sentence, changed "may be required" to
"will be required" and deleted "and, if You are not the insured, proof of
insurable interest may also be required."
In the fifth paragraph, the first and second sentences, changed the verb
from future tense (will be) to present tense (is/are). Also, in regard
to the expense charges for increases in specified amount, added the
following wording to the end of the second sentence: "and will be no
greater than the guaranteed maximum expense charges shown on page 3D".
In the seventh paragraph, first sentence, replaced "of the increase"
with "of any increase".
In the last paragraph, regarding applicability of the suicide exclusion
provision to increases, replaced "refund of the monthly deductions for
the increase" with "refund, without interest, of the cost of insurance
charges, expense charges and charges for any benefit riders deducted in
connection with the increase."
Section 2.9 Maturity Added the entire second paragraph regarding the assumptions made when
determining the maturity date shown on page 3A of the certificate and
how changes from those assumptions could result in termination before
the maturity date.
Section 3.1 When and Where to
Pay Premiums At the end of the second sentence describing insufficient premium
payments resulting in termination, added "according to the terms of the
grace period provision. Payment of the planned periodic premium does
not guarantee this certificate will stay in effect until the maturity
date."
Section 3.2 Planned Periodic Premium Added a cross reference to section 3.7 which details the limits on
premiums.
Section 3.3 Billed Premium Index Added this entire section to describe the billed premium index.
Re-numbered the following sections.
Section 3.5 Net Premium Allocations Revised the third paragraph, to be more affirmative and state that
allocating premium payments to the money market subaccount is for the
first premium.
Section 3.6 Additional Premium
Payments Added a cross reference to section 3.7 which details the limits on
premiums.
Section 3.7 Limits on Premiums In the last sentence, added wording stating that we could request
evidence of insurability.
Section 3.9 Grace Period In the first paragraph, the first sentence, added wording that the grace
period is 61 days. Also, replaced the wording "The grace period will
end 61 days from the date the written notice is sent to You" to "Written
notice will be sent at least 15 days and no more than 45 days prior to
lapse.
In the last sentence of the second paragraph regarding death of the
insured during the grace period, replaced the wording "any unpaid
monthly deduction will be deducted from the death proceeds" with "AAL
will pay death proceeds based upon the death benefit in effect
immediately prior to the start of the grace period, minus any overdue
monthly deduction."
Section 3.11 Paid-up Life Insurance
Option Added this provision which allows the owner to convert the certificate
to a paid-up life insurance certificate using the surrender value.
Section 4.3 Cost of Insurance Rates Added the third and fourth sentences that state "Part of the cost is
used to recover expenses arising from issue of the certificate. Such
expenses are higher in the early certificate years." In the sixth
sentence, revised "However, AAL cannot use cost of insurance rates
higher than the annual guaranteed cost..." to say "However, AAL cannot use
cost of insurance rates higher than the monthly equivalent of the annual
guaranteed cost...".
Section 4.5 Expense Charges In the last paragraph, replaced "in the certificate" with "in section
1.9."
Section 4.6 Mortality and Expense
Risk Charges In the last sentence, added "having the same mortality and expense risk
charge structure" for clarification.
Section 4.7 Surplus Refunds Listed three surplus refund options that surplus refunds may be applied
under (Paid in Cash, Additional Cash Value, and Accumulate With
Interest). The automatic option is Paid in Cash.
Section 4.8 Changes in Certificate
Cost Factors Added this provision which gives the detail of the cost factors that AAL
may change and lists the conditions associated with making the changes.
Section 5.2 Interest Earned on the
Fixed Account Cash Value Wording was revised in the second paragraph. The lower rate of interest
that may be credited to the portion of the Fixed Account cash value that
equals the amount of any certificate loan, will not be less than the
greater of 4 percent or the loan interest rate less 2 percent.
Section 5.3 Fixed Account Cash Value Added the last paragraph regarding crediting additional amounts.
Section 5.4 Basis of Computations In the first paragraph, added "with appropriate increases for
non-standard risk classes" following "the Commissioner's 1980 Standard
Ordinary Mortality Table".
Section 6.1 Variable Account At the end of the first paragraph, added "The AAL Variable Annuity
Account I is subject to the laws of the State of New York to the extent
that AAL, a foreign fraternal benefit society, is subject to those laws.
In the first sentence of the third paragraph, added "and subject to
approval by the New York State Insurance Department".
Section 6.6 Change of Portfolio or
Investment Policy The NY Insurance Department must approve any change in the investment
policy of the Variable Account, so wording to that effect was added to
the first sentence of the second paragraph.
Added the last paragraph describing the right to exchange or convert if
AAL changes the portfolio or investment policy and made reference to
section 1.10.
Section 7.1 Loans The most that may be borrowed as a loan is the surrender value as of the
end of the current certificate year, so the wording limiting the loan
amount to 92 percent of the surrender value was deleted. Added the
sentence "You should consult your tax advisor before obtaining a loan."
Section 7.2 Loan Interest Added wording to the first paragraph to clarify that the loan interest
rates stated are "maximum" and that a lower rate may be charged to be
determined at least once every 12 months, but not more frequently than
once in any 3-month period.
Revised the second paragraph from "A lower rate of interest may be
credited to the portion of the Fixed Account cash value that equals the
amount of any outstanding certificate loan" to "A different rate of
interest may be credited to the portion of the loaned amount of the
Fixed Account cash value than would be credited to the unloaned amount."
Section 7.4 Loan Repayment Added the last sentence regarding how loan payments will be allocated
among the subaccounts.
Section 8.1 Surrender Value Deleted "unpaid" from the second point of this section to read "Any
loans and loan interest".
Section 8.4 Partial Withdrawals Added the second sentence reading "Each withdrawal must be at least
$500.00."
Section 8.5 Delay of Payment In the first paragraph, revised the second sentence, from: "However, AAL
may delay this payment or any other type of payment from the Variable
Account for any period when:"
to: "However, if no premium is in default or if the certificate is being
continued under a variable nonforfeiture benefit AAL may delay this
payment or any other type of payment from the Variable Account (except
when used to pay premiums) for any period when:".
In the first point of paragraph 1, replaced "customary weekend and
holiday closings" with "normal holiday closings".
Deleted the second point which read "Trading on the New York Stock
Exchange is restricted".
In the next point, replaced "An emergency exists" with "The Securities
and Exchange Commission has determined that a state of emergency exists".
Deleted the last point which read "The Securities and Exchange
Commission by order permits the delay for the protection of security
holders."
Added the following wording to the end of the last paragraph "(except
when used to pay premiums). Interest will be paid on the proceeds if
payment is not made within 10 days of receipt of the documentation
necessary to complete the transaction. Such interest will be paid at
the same rate as the current rate payable on Settlement Option 1,
Interest."
Section 9.1 Annual Report Added the following wording to the end of the first sentence "and other
information as required by the insurance department." Added the second
sentence summarizing what information is found in the annual report.
Section 9.2 Illustrative Report Replaced "AAL may charge a reasonable fee..." with "AAL may charge up to
$25.00..."
Section 10.1 Membership Added the second and third paragraphs regarding what could happen if
AAL's Bylaws allowed for expulsion or suspension of a member.
Sections 10.3 (4213ROPNY) and
10.4 (4214ROPNY) Beneficiary In the fourth paragraph, deleted: "If any beneficiary dies at the same
time as the insured or within 15 days after the insured dies but before
the death benefits are paid, AAL will pay the proceeds as though that
beneficiary had died before the insured." Replaced with: "If the
insured and any beneficiary have both died and there is not sufficient
evidence that they have died other than simultaneously, AAL will pay the
proceeds as though that beneficiary had died before the insured, unless
otherwise provided."
Section 10.3 Transfer of Control
(4214ROPNY ONLY) In the first paragraph, deleted the second point, describing who control
may be transferred to, which read "The insured at any time after the
Certificate Anniversary date on or following the insured's 16th
birthday."
In the second paragraph, revised the first point by changing the age
when control automatically transfers to the insured from the "21st
birthday" to the "16th birthday". Deleted the second point, which
stated "When the person who has control dies after the Certificate
Anniversary date on or following the insured's 16th birthday."
Sections 10.4 (4213ROPNY) and
10.6 (4214ROPNY) Collateral
Assignment Replaced the word "recorded" with "received".
Section 10.5 Change of Owner or
Beneficiary (4213ROPNY only) In the first paragraph, added wording to state that the beneficiary
cannot be changed if it was designated as irrevocable. AAL cannot
"approve" the change, so we replaced "be approved by AAL" with "be
received in good order by AAL" and also replaced "If approved" with
"Once valid".
In the second paragraph, replaced "received and approved at the home
office" with "received in good order by AAL."
Section 10.5 Change of Owner or
Beneficiary (4214ROPNY only) In the first paragraph, added "unless the beneficiary has been
designated as irrevocable" to the end of the sentence.
In the second paragraph, added wording to state that the beneficiary
cannot be changed if it was designated as irrevocable.
In the third paragraph, replaced "be approved by AAL" with "be received
in good order by AAL" and also replaced "Once approved" with "Once
valid".
In the fourth paragraph, replaced "received and approved at the home
office" with "received in good order by AAL".
Section 12.2 Beneficiary--Choosing
a Settlement Option for the Death
Proceeds In the last sentence where we talk about paying interest on lump sum
payments, replaced "at a rate required by law" with "at the annual
interest rate currently being paid on Settlement Option 1, Interest".
Section 12.3 Settlement Options Option 4: In the second sentence of the first paragraph, added that if
the payee dies during the guaranteed period, payments will continue to
be paid "to the payee's beneficiary" to the end of the guaranteed
period. Added figures to the table for ages 81 through 90. Also added
the last paragraph "If different guaranteed payment periods have the
same guaranteed payment amounts, the longest guaranteed payment period
will be deemed to have been chosen."
Option 5: In the third sentence of the first paragraph, added that if
both payees die during the guaranteed period, payments will continue to
be paid "to the payee's beneficiary" to the end of the guaranteed
period. Added figures to the tables for ages 85 and 90. Also added the
last paragraph "If different guaranteed payment periods have the same
guaranteed payment amounts, the longest guaranteed payment period will
be deemed to have been chosen."
Section 12.5 Settlement Agreement In the second paragraph, added "to the payee's beneficiary" to tell who
would receive any remaining payments if the payee dies on or after the
settlement agreement commencement date and before the entire interest in
the settlement agreement has been paid.
Back Cover Added "Participating" as one of the descriptive points.
Added "if shown on page 3A" at the end of the descriptive point on the
Death Benefit Guarantee.
Form 4215NY
Payment of Benefit Added the first sentence of paragraph two, as follows: "Proof of death
includes a certified copy of the death certificate, medical
documentation, and reports of investigating authorities, if any."
Deaths Not Covered The suicide exclusion was revised by deleting "while sane or insane" and
adding "within 2 years from the date of issue of this rider."
The second exclusion beginning with "A physical or mental illness..." was
revised by adding the following to the end of the sentence: "(however,
deaths due to an infection of an accidental wound will be covered)".
In the definition of aircraft, deleted "balloons" as a type of aircraft.
Incontestability Added "of this rider" to the end of the sentence.
Termination Added the last sentence, which states "You may terminate this rider at
any time upon written request."
