<PAGE>
As filed with the Securities and Exchange Commission on November 16, 1998.
File No.
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 II
B. Name of depositor: 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:
Thomas S. Clark, Esq.
Hartford Life and Annuity Insurance Company
P.O. Box 2999
Hartford, CT 06104-2999
E. Title and amount of securities being registered: Pursuant to Rule
24f-2 under the Investment Company Act of 1940, the Registrant will
register an indefinite amount of securities.
F. Proposed maximum aggregate offering price to the public of the
securities being registered: Not yet determined.
G. Amount of filing fee: Not applicable.
H. Approximate date of proposed public offering: As soon as practicable
after the effective date of this registration statement.
The registrant hereby amends this Registration Statement on such dates 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 thereafter 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-6 AND PROSPECTUS
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ITEM NO. OF FORM N-6 CAPTION IN PROSPECTUS
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1. Cover Page and Last Page
2. Summary of Benefits and Risks
3. Fee Table
4. About Us
5. Charges and Deductions
6. Your Policy
7. Premiums
8. Death Benefits and Policy Value
9. Making Withdrawals From Your Policy
10. Loans
11. Lapse and Reinstatement
12. Taxes
13. Legal Proceedings
14. Financial Statements
15. Cover Page and Table of Contents
16. General Information and History
17. Services
18. Not Applicable
19. Not Applicable
20. Distribution of the Policies
21. Additional Information About Charges
22. Not Applicable
23. Not Applicable
24. Financial Statements
25. Performance Data
26. Not Applicable
27. Exhibits
28. Directors and Officers
29. Persons Controlled by or Under Common
Control with the Depositor or the
Registrant
30. Indemnification
31. Principal Underwriters
32. Location of Accounts and Records
33. Management Services
34. Fee Representation
</TABLE>
<PAGE>
STAG VARIABLE LIFE LAST SURVIVOR II
SEPARATE ACCOUNT VL II
HARTFORD LIFE AND ANNUITY INSURANCE COMPANY
P.O. BOX 2999
HARTFORD, CONNECTICUT 06104-2999
[LOGO] TELEPHONE: (800) 231-5453
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This Prospectus describes information you should know before you purchase the
Stag Variable Life Last Survivor II variable life insurance policy. Please read
it carefully.
Stag Variable Life Last Survivor II is a contract between you and Hartford Life
and Annuity Insurance Company. You agree to make sufficient premium payments to
us, and we agree to pay a death benefit to your beneficiary. The policy is a
last survivor flexible premium variable life insurance policy. It is:
X Last survivor, because we pay a death benefit after the death of the last
surviving insured.
X Flexible premium, because you may add payments to your policy after the first
payment.
X Variable, because the value of your life insurance policy will fluctuate with
the performance of the underlying investment options you select and the
Fixed Account.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved these securities, or determined if this
Prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
The policy may not be available for sale in all states.
This Prospectus can also be obtained from the Securities and Exchange
Commission's website (HTTP://WWW.SEC.GOV).
This life insurance policy IS NOT:
- - a bank deposit or obligation
- - federally insured
- - endorsed by any bank or governmental agency
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Prospectus Dated: [ ], 1999
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2 HARTFORD LIFE AND ANNUITY INSURANCE COMPANY
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TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
SUMMARY OF BENEFITS AND RISKS......................................... 3
FEE TABLE............................................................. 4
ABOUT US.............................................................. 6
Hartford Life and Annuity Insurance Company......................... 6
The Separate Account VL II.......................................... 6
The Funds........................................................... 6
CHARGES AND DEDUCTIONS................................................ 8
YOUR POLICY........................................................... 10
PREMIUMS.............................................................. 11
DEATH BENEFITS AND POLICY VALUES...................................... 13
MAKING WITHDRAWALS FROM YOUR POLICY................................... 15
LOANS................................................................. 15
LAPSE AND REINSTATEMENT............................................... 16
TAXES................................................................. 17
LEGAL PROCEEDINGS..................................................... 21
OTHER MATTERS......................................................... 21
FINANCIAL STATEMENTS.................................................. 21
GLOSSARY OF SPECIAL TERMS............................................. 22
WHERE YOU CAN FIND MORE INFORMATION................................... 23
</TABLE>
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HARTFORD LIFE AND ANNUITY INSURANCE COMPANY 3
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SUMMARY OF BENEFITS
AND RISKS
BENEFITS OF YOUR POLICY
FLEXIBILITY -- The policy is designed to be flexible to meet your specific
life insurance needs. You have the flexibility to choose death benefit options,
investment options, and premiums you pay.
DEATH BENEFIT -- While the policy is in force and when the last surviving
insured dies, we pay a death benefit to your beneficiary. You select one of
three death benefit options:
X LEVEL OPTION: The death benefit equals the current Face Amount.
X RETURN OF ACCOUNT VALUE OPTION: The death benefit is the current Face Amount
plus the Account Value of your policy.
X RETURN OF PREMIUM OPTION: The death benefit is the current Face Amount plus
the total of your premium payments, however, it will be no more than the
current Face Amount plus $2.5 million.
The death benefit is reduced by any money you owe us, such as outstanding
loans, loan interest, or unpaid charges. You may change your death benefit
option under certain circumstances. You may increase or decrease the Face Amount
on your policy under certain circumstances.
DEATH BENEFIT GUARANTEE -- Generally, your death benefit coverage will last
as long as there is enough value in your policy to pay for the monthly charges
we deduct. Since this is a variable life policy, values of your policy will
fluctuate based on the performance of the underlying investment options you have
chosen. Without the Death Benefit Guarantee your policy will lapse if the value
of your policy is insufficient to pay your monthly charges. However, when the
Death Benefit Guarantee feature is in effect, the policy will not lapse,
regardless of the investment performance of the underlying funds.
When you apply for the policy you choose what percentage of the total face
amount that is covered by the Death Benefit Guarantee. The Death Benefit
Guarantee period is the maximum number of policy years that the Death Benefit
Guarantee is available on the policy. The Death Benefit Guarantee period is
individualized based on the issue ages, sexes and risk classes of the insureds
and is provided in the policy. In order to maintain the Death Benefit Guarantee
feature, the cumulative premiums paid into the policy, less withdrawals and
indebtedness, must exceed the Cumulative Death Benefit Guarantee Premium.
INVESTMENT OPTIONS -- You may invest in up to 9 different investment choices
within your policy, from a choice of 36 investment options and a Fixed Account.
You may transfer money among your investment choices, subject to restrictions.
PREMIUM PAYMENTS -- You have the flexibility to choose how you pay premiums.
You choose a planned premium when you purchase the policy. You may change your
planned premium, or pay additional premium any time, subject to certain
limitations.
RIGHT TO EXAMINE YOUR POLICY -- For 10 days after you receive your policy,
you may cancel it without paying a sales charge. A longer period is provided in
some states.
WITHDRAWALS -- You may take money out of your policy once a month, subject
to certain minimums. (See Risks of Your Policy, below).
LOANS -- You may take a loan on the policy. The policy secures the loan.
SETTLEMENT OPTIONS -- You or your beneficiary may choose to receive the
proceeds of the policy over a period of time by using one of several settlement
options.
OPTIONAL COVERAGE -- You may add other coverages to your policy. See "Your
Policy -- Other Benefits."
WHAT DOES YOUR PREMIUM PAY FOR?
Your premium pays for three things. It pays for insurance coverage, it acts
as an investment in the Sub-Accounts, and it pays for sales loads and other
charges.
RISKS OF YOUR POLICY
INVESTMENT PERFORMANCE -- The value of your policy will fluctuate with the
performance of its underlying investments. Your investment options may decline
in value, or they may not perform to your expectations. Your policy values in
the Sub-Accounts are not guaranteed.
UNSUITABLE FOR SHORT-TERM SAVINGS -- The policy is designed for long term
financial planning. You should not purchase the policy if you will need the
premium payment in a short time period.
RISK OF LAPSE -- Your policy could terminate if the value of the policy
becomes too low to support the policy's monthly charges. If this occurs, we will
notify you in writing. You will then have a 61-day grace period to pay
additional amounts to prevent the policy from terminating.
WITHDRAWAL LIMITATIONS -- You are limited to one withdrawal per month.
Withdrawals will reduce your policy's death benefit, and may be subject to a
surrender charge.
TRANSFER LIMITATIONS -- We reserve the right to limit the size of transfers
and remaining balances, and to limit the
<PAGE>
4 HARTFORD LIFE AND ANNUITY INSURANCE COMPANY
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number and frequency of transfers among your investment options and the Fixed
Account.
LOANS -- Taking a loan from your policy may increase the risk that your
policy will lapse, will have a permanent effect on the policy's Account Value,
and will reduce the death proceeds.
ADVERSE TAX CONSEQUENCES -- You may be subject to income tax if you receive
any loans, withdrawals or other amounts from the policy, and you may be subject
to a 10% penalty tax. See "Taxes."
FEE TABLE
The following tables describes the MAXIMUM fees and expenses that you will
pay when buying, owning, and surrendering the policy. The first table describes
the maximum fees and expenses that you will pay at the time that you buy the
policy, surrender the policy, or transfer cash value between investment options.
TRANSACTION FEES
<TABLE>
<CAPTION>
POLICIES FROM WHICH CHARGE IS
CHARGE WHEN CHARGE IS DEDUCTED AMOUNT DEDUCTED DEDUCTED
---------------------- ---------------------------------- ---------------------------------- ----------------------------------
<S> <C> <C> <C>
Sales Charge When you pay premium. 6% of premium All
Premium Tax Charge When you pay premium. A percent of premium which varies All
by your state and municipality of
residence. The range of premium
tax charge is generally between 0%
and 4%.
This rate will change if your
state or municipality changes its
premium tax charges. It may change
if you change your state or
municipality of residence.
Surrender Charges When you surrender your policy. Surrender charge varies by policy
When you make certain Face Amount year and equals a percentage times
decreases. the sum of two components: the
When you take certain withdrawals. sales surrender charge and the
underwriting surrender charge. The
sales surrender charge equals the
Death Benefit Guarantee Premium.
The underwriting surrender charge
equals $1 per $1,000 of initial
face amount, but is at least $500
and no more than $3,000.
The percentage by policy years is Policies surrendered during the
as follows: first nine policy years.
Policy Policies where the Face Amount is
Year Percentage reduced below the initial Face
1 70% Amount during the first nine
2 70% policy years.
3 70%
4 60%
5 50%
6 40%
7 30%
8 20%
9 10%
10 and after 0%
</TABLE>
<PAGE>
HARTFORD LIFE AND ANNUITY INSURANCE COMPANY 5
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<TABLE>
<CAPTION>
POLICIES FROM WHICH CHARGE IS
CHARGE WHEN CHARGE IS DEDUCTED AMOUNT DEDUCTED DEDUCTED
---------------------- ---------------------------------- ---------------------------------- ----------------------------------
<S> <C> <C> <C>
Face Amount Increase Each month for 12 months beginning 1/12 of $1 per month per thousand Policies where the owner has made
Fee on the effective date of any of Face Amount increase. an unscheduled increase.
unscheduled increase in Face Monthly fees charged will not be
Amount you request. less than 1/12 of $500 and will
not exceed 1/12 of $3,000.
Transfer Fees When you make a transfer after the $25 per transfer. Those policies with more than one
first transfer in any month. transfer per month.
Withdrawal Fee When you take a withdrawal. $10 per withdrawal. Those policies where the owner has
made a withdrawal.
</TABLE>
The next table describes the MAXIMUM fees and expenses that you will pay
periodically during the time that you own the policy, not including Fund fees
and expenses.
ANNUAL CHARGES OTHER THAN FUND OPERATING EXPENSES
<TABLE>
<CAPTION>
POLICIES FROM WHICH CHARGE IS
CHARGE WHEN CHARGE IS DEDUCTED AMOUNT DEDUCTED DEDUCTED
---------------------- ---------------------------------- ---------------------------------- ----------------------------------
<S> <C> <C> <C>
Cost of Insurance Monthly. The charge is the maximum cost of All
Charges insurance rate times the net
amount at risk. Maximum cost of
insurance rates are
individualized, depending on issue
ages, sexes, insurance classes,
substandard ratings, and duration.
Mortality and Expense Monthly. Per the Sub-Account accumulated All
Risk Charge value:
- 1/12 of 0.75% per month for
policy years 1-10.
- 1/12 of 0.60% per month after
the 10th policy year.
Per $1,000 of initial Face Amount
during the first 10 policy years:
- individualized based on issue
ages and Death Benefit Guarantee
Amount.
Administrative Charge Monthly. Years 1-5: All
$30
Years 6+:
$10
Rider Charges Monthly. Individualized based on optional Only those policies with benefits
rider selected. provided by rider.
</TABLE>
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6 HARTFORD LIFE AND ANNUITY INSURANCE COMPANY
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The next table describes the Fund fees and expenses that you will pay
periodically during the time that you own the policy. The table shows the
minimum and maximum fees and expenses charged by any of the Funds. More detail
concerning each Fund's fees and expenses is contained in the prospectus for each
Fund.
ANNUAL FUND OPERATING EXPENSES
<TABLE>
<CAPTION>
POLICIES FROM WHICH CHARGE IS
CHARGE WHEN CHARGE IS DEDUCTED AMOUNT DEDUCTED DEDUCTED
---------------------- ---------------------------------- ---------------------------------- ----------------------------------
<S> <C> <C> <C>
Management Fees Daily net asset values of a Fund 0.40% - 1.20% All Policies for those funds
reflect Management Fees already currently selected by you.
deducted from assets of the Fund.
Other Expenses Daily net asset values of a Fund 0.011% - 0.680% All Policies, but deductions only
reflect Other Expenses already from Sub-Accounts in use.
deducted from the assets of the
Fund.
Total Fund Annual Daily net asset values of a Fund 0.42% - 1.27% All Policies, but deductions only
Expenses reflect Total Fund Annual from Sub-Accounts in use.
Operating Expenses already
deducted from assets of the Fund.
</TABLE>
ABOUT US
HARTFORD LIFE AND ANNUITY
INSURANCE COMPANY
We are Hartford Life and Annuity Insurance Company ("Hartford") located in
Simsbury, Connecticut. We provide health and life insurance in all states,
except New York. Our mailing address is P.O. Box 2999, Hartford, CT 06104-2999.
We are ultimately controlled by Hartford Fire Insurance Company, one of the
largest multiple lines insurance carriers in the United States.
SEPARATE ACCOUNT VL II
The Sub-Accounts are subdivisions of our separate account, called Separate
Account VL II. The Separate Account exists to keep your life insurance policy
assets separate from our company assets. As such, the investment performance of
the Separate Account is independent from the investment performance of
Hartford's other assets. Hartford's other assets are utilized to pay you
insurance obligations under the policy. Your assets in the Separate Account are
held exclusively for your benefit and may not be used for any other liability of
Hartford.
THE FUNDS
The Sub-Accounts of the Separate Account purchase shares of mutual funds set
up exclusively for variable annuity and variable life insurance products. These
funds are not the same mutual funds that you buy through your stockbroker or
through a retail mutual fund, but they may have similar investment strategies
and the same portfolio managers as retail mutual funds. You choose the Sub-
Accounts that meet your investment style.
You should read the prospectuses for each of the Funds listed below for
detailed information about each Fund. The prospectuses for the Funds are
attached to this Prospectus. All Funds may not be available in all states.
You may also allocate some or all of your premium payments to the "Fixed
Account," which pays a declared interest rate. See "The Fixed Account."
The following Sub-Accounts are available under your policy. Opposite the
name of each Sub-Account is the name of the shares of the underlying fund that
the Sub-Account purchases:
<TABLE>
<CAPTION>
SUB-ACCOUNT PURCHASES SHARES OF:
- ------------------------------------------------------- ---------------------------------------------------------------------------
<S> <C>
Hartford Advisers Fund Sub-Account Class IA of Hartford Advisers HLS Fund, Inc.
Hartford Bond Fund Sub-Account Class IA of Hartford Bond HLS Fund, Inc.
Hartford Capital Appreciation Fund Class IA of Hartford Capital Appreciation HLS Fund, Inc.
Sub-Account
Hartford Dividend and Growth Fund Class IA of Hartford Dividend and Growth HLS Fund, Inc.
Sub-Account
Hartford Growth and Income Fund Sub-Account Class IA of Hartford Growth and Income HLS Fund, Inc.
</TABLE>
<PAGE>
HARTFORD LIFE AND ANNUITY INSURANCE COMPANY 7
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<TABLE>
<S> <C>
Hartford Index Fund Sub-Account Class IA of Hartford Index HLS Fund, Inc.
Hartford International Advisers Fund Class IA of Hartford International Advisers HLS Fund, Inc.
Sub-Account
Hartford International Opportunities Fund Class IA of Hartford International Opportunities HLS Fund, Inc.
Sub-Account
Hartford MidCap Fund Sub-Account Class IA of Hartford MidCap HLS Fund, Inc.
Hartford Mortgage Securities Fund Sub-Account Class IA of Hartford Mortgage Securities HLS Fund, Inc.
Hartford Money Market Fund Sub-Account Class IA of Hartford Money Market HLS Fund, Inc.
Hartford Small Company Fund Sub-Account Class IA of Hartford Small Company HLS Fund, Inc.
Hartford Stock Fund Sub-Account Class IA of Hartford Stock HLS Fund, Inc.
Putnam VT Asia Pacific Growth Fund Class IA of Putnam VT Asia Pacific Growth Fund of the Putnam Variable Trust
Sub-Account
Putnam VT Diversified Income Fund Class IA of Putnam VT Diversified Income Fund of Putnam Variable Trust
Sub-Account
Putnam VT Global Asset Allocation Fund Class IA of Putnam VT Global Asset Allocation Fund of Putnam Variable Trust
Sub-Account
Putnam VT Global Growth Fund Sub-Account Class IA of Putnam VT Global Growth Fund of Putnam Variable Trust
Putnam VT Growth and Income Fund Class IA of Putnam VT Growth and Income Fund of Putnam Variable Trust
Sub-Account
Putnam VT Health Sciences Fund Sub-Account Class IA of Putnam VT Health Sciences Fund of Putnam Variable Trust
Putnam VT High Yield Fund Sub-Account Class IA of Putnam VT High Yield Fund of Putnam Variable Trust
Putnam VT International Growth Fund Class IA of Putnam VT International Growth Fund of Putnam Variable Trust
Sub-Account
Putnam VT International Growth and Income Fund Class IA of Putnam VT International Growth and Income Fund of Putnam
Sub-Account Variable Trust
Putnam VT International New Opportunities Fund Class IA of Putnam VT International New Opportunities Fund of Putnam
Sub-Account Variable Trust
Putnam VT Investors Fund Sub-Account Class IA of Putnam VT Investors Fund of Putnam Variable Trust
Putnam VT Money Market Fund Sub-Account Class IA of Putnam VT Money Market Fund of Putnam Variable Trust
Putnam VT New Opportunities Fund Class IA of Putnam VT New Opportunities Fund of Putnam Variable Trust
Sub-Account
Putnam VT New Value Fund Sub-Account Class IA of Putnam VT New Value Fund of Putnam Variable Trust
Putnam VT OTC & Emerging Growth Fund Sub-Account Class IA of Putnam VT OTC & Emerging Growth Fund of Putnam Variable Trust
Putnam VT The George Putnam Fund of Boston Sub-Account Class IA of Putnam VT The George Putnam Fund of Boston of Putnam Variable
Trust
Putnam VT U.S. Government and High Quality Bond Fund Class IA of Putnam VT U.S. Government and High Quality Bond Fund of Putnam
Sub-Account Variable Trust
Putnam VT Utilities Growth and Income Fund Sub-Account Class IA of Putnam VT Utilities Growth and Income Fund of Putnam Variable
Trust
Putnam VT Vista Fund Sub-Account Class IA of Putnam VT Vista Fund of Putnam Variable Trust
Putnam VT Voyager Fund Sub-Account Class IA of Putnam VT Voyager Fund of Putnam Variable Trust
Fidelity VIP Equity-Income Portfolio Fidelity VIP Equity-Income Portfolio of Variable Insurance Products Fund
Sub-Account
Fidelity VIP Overseas Portfolio Sub-Account Fidelity VIP Overseas Portfolio of Variable Insurance Products Fund
Fidelity VIP II Asset Manager Portfolio Fidelity VIP II Asset Manager Portfolio of Variable Insurance Products Fund
Sub-Account II
</TABLE>
INVESTMENT ADVISERS -- HL Investment Advisors, Inc. is investment adviser
for the Hartford Funds. Wellington Management Company, LLP is investment
sub-adviser for Hartford Advisers HLS Fund, Inc., Hartford Capital Appreciation
HLS Fund, Inc., Hartford Dividend and Growth HLS Fund, Inc., Hartford Growth and
Income HLS Fund, Inc., Hartford International Advisers HLS Fund, Inc., Hartford
<PAGE>
8 HARTFORD LIFE AND ANNUITY INSURANCE COMPANY
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International Opportunities HLS Fund, Inc., Hartford MidCap HLS Fund, Inc.,
Hartford Small Company HLS Fund, Inc., and Hartford Stock HLS Fund, Inc. The
Hartford Investment Management Company, Inc. ("HIMCO") is investment sub-adviser
for Hartford Bond HLS Fund, Inc., Hartford Index HLS Fund, Inc., Hartford
Mortgage Securities HLS Fund, Inc., and Hartford Money Market HLS Fund, Inc.
Putnam Management is investment adviser for the Putnam Funds.
Fidelity Management & Research Company is investment adviser for the
Fidelity VIP Funds.
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 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 for
the Hartford Funds, the Board of Trustees for the Putnam Funds and the Board of
Trustees for the Fidelity VIP Funds (collectively, the "Boards") intend to
monitor events in order to identify any material conflicts between the 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 annuity and variable life insurance separate accounts,
Hartford will bear the attendant expenses.
VOTING RIGHTS -- For Sub-Accounts in which you have invested, we will notify
you of shareholder's meetings of the Funds purchased by those Sub-Accounts. We
will send you proxy materials and instructions for you to vote the shares held
for your benefit by those Sub-Accounts. We will arrange for the handling and
tallying of proxies received from you or other policy owners. If you give no
instructions, we will vote those shares in the same proportion as shares for
which we received instructions.
THE FIXED ACCOUNT
You may allocate amounts to the Fixed Account. The Fixed Account is not a
part of the Separate Account, but is a part of our general assets. As such, the
Fixed Account (and this description of the Fixed Account) is not subject to the
same securities laws as the Separate Account.
The Fixed Account credits at least 3.5% per year. We are not obligated to,
but may, credit more than 3.5% per year. If we do, such rates are determined at
our sole discretion. You assume the risk that, at any time, the Fixed Account
may credit no more than 3.5%.
CHARGES AND DEDUCTIONS
DEDUCTIONS FROM PREMIUM
Before your premium is allocated to the Sub-Accounts and/or the Fixed
Account, we deduct a percentage from your premium for a sales load and a premium
tax charge. The amount allocated after the deductions is called your Net
Premium.
FRONT-END SALES LOAD -- We deduct a sales load from each premium you pay.
The maximum sales load under the policy is 6% of premium.
PREMIUM TAX CHARGE -- We deduct a premium tax charge from each premium you
pay. The premium tax charge covers taxes assessed against us by a state and/or
other governmental entity. The range of such charge generally is between 0% and
4%.
DEDUCTIONS FROM ACCOUNT VALUE
MONTHLY DEDUCTION AMOUNTS -- Each month we will deduct an amount from your
Account Value to pay for the benefits provided by your policy. This amount is
called the Monthly Deduction Amount and equals the sum of:
- - the charge for the cost of insurance;
- - the monthly administrative charge;
- - the mortality and expense risk charge;
- - any Face Amount increase fee;
- - any charges for additional benefits provided by rider.
Each Monthly Deduction Amount will be deducted pro rata from the Fixed
Account and each of the Sub-Accounts. The Monthly Deduction Amount will vary
from month to month.
COST OF INSURANCE CHARGE -- The charge for the cost of insurance equals:
(i) the cost of insurance rate per $1,000, multiplied by
(ii) the amount at risk, divided by
(iii) $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 rates will be determined on each policy anniversary based
on our future expectations of such factors as mortality, expenses, interest,
persistency and taxes. The cost of insurance rates will not exceed those based
on the 1980 Commissioners' Standard Ordinary Mortality Table (ALB), Male or
Female, Nonsmoker or
<PAGE>
HARTFORD LIFE AND ANNUITY INSURANCE COMPANY 9
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Smoker Table, age last birthday (unisex rates may be required in some states). A
table of guaranteed cost of insurance rates per $1,000 will be included in your
policy, however, we reserve the right to use rates less than those shown in the
table. Substandard risks will be charged higher cost of insurance rates that
will not exceed rates based on a multiple of 1980 Commissioners' Standard
Ordinary Mortality Table (ALB), Male or Female, Nonsmoker or Smoker Table, age
last birthday (unisex rates may be required in some states) plus any flat extra
amount assessed. The multiple will be based on the insured's substandard rating.
Any changes in the cost of insurance rates will be made uniformly for all
insureds of the same issue ages, sexes, risk classes 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 insureds' health.
Because your Account Value and death benefit may vary from month to month,
the cost of insurance may also vary on each Monthly Activity Date. The cost of
insurance depends on your policy's amount at risk. Items which may affect the
amount at risk include the amount and timing of premium payments, investment
performance, fees and charges assessed, rider charges, policy loans and changes
to the Face Amount.
MONTHLY ADMINISTRATIVE CHARGE -- We deduct a monthly administrative charge
from your Account Value to compensate us for issue and administrative costs of
the policy. During the first 5 years of the policy, the charge is $30 per month.
After 5 years, the charge is $10 per month.
MORTALITY AND EXPENSE RISK CHARGE -- We deduct a mortality and expense risk
charge each month from your Account Value. There are two components to the
mortality and expense risk charge. Part of the charge is assessed according to
your Account Value attributable to the Sub-Accounts, and the other part is
assessed based on the initial Face Amount of your policy. The mortality and
expense risk charge each month is equal to the sum of (a) and (b) where
(a) equals:
(i) the monthly accumulated value mortality and expense risk rate;
multiplied by
(ii) the sum of your accumulated values in the Sub-Accounts on the Monthly
Activity Date, prior to assessing the Monthly Deduction Amount.
and
(b) equals:
(i) the monthly mortality and expense risk rate per $1,000; multiplied by
(ii) the initial Face Amount; divided by
(iii) $1,000.
During the first 10 years, the maximum accumulated value mortality and
expense risk rate is 1/12 of 0.75% per month. Thereafter, the maximum is 1/12 of
0.60% per month.
During the first 10 years, the Face Amount mortality and expense risk rate
per $1,000 of initial Face Amount is individualized based on issue ages and
death benefit guarantee, and is provided in the policy. Thereafter, there is no
charge.
The mortality and expense risk charge compensates us for mortality and
expense risks assumed under the policies. The mortality risk assumed is that the
cost of insurance charges are insufficient to meet actual claims. The expense
risk assumed is that the expense incurred in issuing, distributing and
administering the policies exceed the administrative charges and sales loads
collected. Hartford may keep any difference between cost it incurs and the
charges it collects.
FACE AMOUNT INCREASE FEE -- We deduct a dollar amount from your Account
Value for an unscheduled increase of the Face Amount on your policy. We deduct
the fee each month for twelve months after the increase. The fee is 1/12 of
$1.00 per month per $1,000 of unscheduled increase in the Face Amount. The fee
will not be less than 1/12 of $500 per month, but will not exceed 1/12 of $3,000
per month. This fee compensates us for underwriting and processing costs for
such increases.
RIDER CHARGE -- If your policy includes riders, a charge applicable to the
riders is made from the Account Value each month. The charge applicable to these
riders is to compensate Hartford for the anticipated cost of providing these
benefits and is specified on the applicable rider. For a description of the
riders available, see "Your Policy -- Supplemental Benefits."
SURRENDER CHARGE -- During the first 9 policy years, surrender charges will
be deducted from your Account Value if
- - you surrender your policy;
- - you decrease the Face Amount to an amount lower than it has ever been; or
- - you take a withdrawal that causes the Face Amount to fall below the lowest
previous Face Amount.
The amount of surrender charge is individualized based on your issue ages,
sexes, insurance classes, duration, Face Amount and Death Benefit Guarantee
Amount. The charge compensates us for expenses incurred in issuing the policy
and the recovery of acquisition costs. Hartford may keep any difference between
cost it incurs and the charges it collects. For partial surrender charges
applicable to a decrease in the Face Amount or withdrawal, see "Unscheduled
Increases and Decreases in the Face
<PAGE>
10 HARTFORD LIFE AND ANNUITY INSURANCE COMPANY
- --------------------------------------------------------------------------------
Amount." The amount of surrender charge varies by policy year and equals a
percentage times the sum of two components: the sales surrender charge and the
underwriting surrender charge. The sales surrender charge equals the Death
Benefit Guarantee Premium. The underwriting surrender charge equals $1 per
$1,000 of initial face amount, but is at least $500 and no more than $3,000.
The percentage by policy years is as follows:
<TABLE>
<CAPTION>
POLICY YEAR PERCENTAGE
------------ -----
<S> <C>
1 70%
2 70%
3 70%
4 60%
5 50%
6 40%
7 30%
8 20%
9 10%
10 and after 0%
</TABLE>
CHARGES FOR THE FUNDS
The investment performance of each Fund reflects the management fee that the
Fund pays to its investment manager as well as other operating expenses that the
Fund incurs. Investment management fees are generally daily fees computed as a
percentage of a Fund's average daily net assets as an annual rate. Please read
the prospectus for each Fund for complete details.
YOUR POLICY
CONTRACT RIGHTS
POLICY OWNER, OR "YOU" -- As long as your policy is in force, you may
exercise all rights under the policy while either of the insureds is alive and
no beneficiary has been irrevocably named.
BENEFICIARY -- You name the beneficiary in your application for the policy.
You may change the beneficiary (unless irrevocably named) while either of the
insureds is alive by notifying us in writing. If no beneficiary is living when
the last surviving insured dies, the death benefit will be paid to you if
living; or, otherwise, to your estate.
ASSIGNMENT -- You may assign your policy. Until you notify us in writing, no
assignment will be effective against us. We are not responsible for the validity
of any assignment.
STATEMENTS -- We will send you a statement at least once each year, showing:
(a) the current Account Value, Cash Surrender Value and Face Amount;
(b) the premiums paid, monthly deduction amounts and any loans since your last
statement;
(c) the amount of any Indebtedness;
(d) any notifications required by the provisions of your policy; and
(e) any other information required by the Insurance Department of the state
where your policy was delivered.
CONTRACT LIMITATIONS
ALLOCATIONS TO SUB-ACCOUNTS AND THE FIXED ACCOUNT -- You may allocate
amounts to a maximum of nine (9) Sub-Accounts, or eight (8) Sub-Accounts and the
Fixed Account.
TRANSFERS OF ACCOUNT VALUE -- You may transfer amounts among the Fixed
Account and the Sub-Accounts subject to a charge described below. You may
request transfers in writing or by calling us at 1-800-231-5453. Transfers by
telephone may be made by your agent of record or by your attorney-in-fact
pursuant to a power of attorney. Telephone transfers may not be permitted in
some states. We will not be responsible for losses that result from acting upon
telephone requests reasonably believed to be genuine. We will employ reasonable
procedures to confirm that instructions communicated by telephone are genuine.
The procedures we follow for transactions initiated by telephone include
requiring callers to provide certain identifying information. All transfer
instructions communicated to us by telephone are tape recorded.
You may make one transfer per calendar month free of charge, excluding any
transfers made pursuant to your enrollment in the Dollar Cost Averaging Program.
Each subsequent transfer in excess of one per calendar month will be subject to
a transfer charge of up to $25. We reserve the right to limit at a future date
the size of transfers and remaining balances and to limit the number and
frequency of transfers.
TRANSFERS FROM THE FIXED ACCOUNT -- Unless you are enrolled in the Dollar
Cost Averaging Program, any transfers from the Fixed Account must occur during
the 30-day period following each Policy Anniversary, and, if your accumulated
value in the Fixed Account exceeds $1,000, the amount transferred from the Fixed
Account in any Policy Year may not exceed 25% of the accumulated value in the
Fixed Account on the transfer date.
DEFERRAL OF PAYMENTS -- 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 you interest.
<PAGE>
HARTFORD LIFE AND ANNUITY INSURANCE COMPANY 11
- --------------------------------------------------------------------------------
CHANGES TO CONTRACT OR SEPARATE ACCOUNT
MODIFICATION OF POLICY -- The only way the policy may be modified is by a
written agreement signed by our President, or one of our Vice Presidents,
Secretaries, or Assistant Secretaries.
SUBSTITUTION OF FUNDS -- We reserve the right to substitute the shares of
any other registered investment company for the shares of any Fund already
purchased or to be purchased in the future by the Separate Account provided that
the substitution has been approved by the Securities and Exchange Commission.
CHANGE IN OPERATION OF THE SEPARATE ACCOUNT -- The operation of the Separate
Account may be modified to the extent permitted by law, including deregistration
under the securities laws.
SEPARATE ACCOUNT TAXES -- Currently, no charge is made to the Separate
Account for federal, state and local taxes that may be allocable to the Separate
Account. A change in the applicable federal, state or local tax laws which
impose tax on Hartford and/or the Separate Account may result in a charge
against the policy in the future. Charges for other taxes, if any, allocable to
the Separate Account may also be made.
OTHER BENEFITS
DOLLAR COST AVERAGING PROGRAM -- You may elect to allocate your Net Premiums
among the Sub-Accounts and the Fixed Account pursuant to the Dollar Cost
Averaging (DCA) program. If you choose the DCA program, your Net Premiums will
be deposited into the Hartford Money Market Sub-Account or the Fixed Account.
Amounts will be transferred monthly to the other investment options in
accordance with your premium allocation instructions. The dollar amount will be
allocated to the investment options that you specify, in the proportions that
you specify. If, on any transfer date, your Account Value allocated to the
Dollar Cost Averaging program is less than the amount you have elected to
transfer, your DCA program will terminate.
You may cancel your DCA election by notice in writing or by calling us at
1-800-231-5453. We reserve the right to change or discontinue the DCA program.
The main objective of a DCA program is to minimize the impact of short-term
price fluctuations. The DCA program allows you to take advantage of market
fluctuations. Since the same dollar amount is transferred to your selected
investment options at set intervals, the DCA program allows you to purchase more
accumulation units when prices are low and fewer accumulation units when prices
are high. Therefore, a lower average cost per accumulation unit may be achieved
over the long term. However, it is important to understand that the DCA program
does not assure a profit or protect against loss in a declining market.
SUPPLEMENTAL BENEFITS -- The following supplemental benefits are among the
options that may be included in a policy by rider, subject to the restrictions
and limitations set forth therein.
- - LAST SURVIVOR EXCHANGE OPTION RIDER. We will exchange your policy for two
individual policies on the life of each insured, subject to the conditions
stated in the rider.
- - ESTATE PROTECTION RIDER. We will pay a term insurance benefit upon receipt of
due proof of the last surviving insured's death while your policy and rider
are in force, subject to the conditions stated in the rider.
- - YEARLY RENEWABLE TERM LIFE INSURANCE RIDER. While the rider is in force, we
will pay the term life insurance amount upon receipt of due proof of death of
the designated insured, subject to the conditions stated in the rider.
CLASS OF PURCHASERS
REDUCED CHARGES FOR ELIGIBLE GROUPS -- Certain of the charges and deductions
described above may be reduced for policies issued in connection with a specific
plan, in accordance with our rules in effect as of the date the application for
a policy is approved. To qualify for such a reduction, a plan must satisfy
certain criteria, e.g., as to 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 policies are purchased
and certain characteristics of the plan's members. The amount of reduction and
the criteria for qualification will be reflected in 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 invested in Separate
Account VL II.
PREMIUMS
APPLICATION FOR A POLICY -- To purchase a policy you must submit an
application to us. Within limits, you may choose the initial Face Amount.
Policies generally will be issued only on the lives of insureds between the ages
of 20 and 85 who supply evidence of insurability satisfactory to us. Acceptance
is subject to our underwriting rules and we reserve the right to reject an
application for any reason. No change in the terms or conditions of a policy
will be made without your consent. The minimum initial premium is the
<PAGE>
12 HARTFORD LIFE AND ANNUITY INSURANCE COMPANY
- --------------------------------------------------------------------------------
amount required to keep the policy in force for one month, but not less than
$50.
Your Policy will be effective on the Policy Date only after we receive all
outstanding delivery requirements and the initial premium payment. The Policy
Date is the date used to determine all future cyclical transactions on the
Policy, such as Monthly Activity Date and Policy Years.
PREMIUM PAYMENT FLEXIBILITY -- You have considerable flexibility as to when
and in what amounts you pay premiums under your policy.
Prior to policy issue, you choose a planned premium, within a range
determined by us. We will send you premium notices for planned premiums. Such
notices may be sent on an annual, semi-annual or quarterly basis. You may also
have premiums automatically deducted monthly from your checking account. The
planned premiums and payment mode you select are shown on your policy's
specifications page. You may change the planned premiums, subject to our minimum
amount rules then in effect.
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. Your policy may lapse if the value of your policy becomes insufficient
to cover the Monthly Deduction Amounts. In such case you may be required to pay
additional premiums in order to prevent the policy from terminating. For details
see, "Lapse and Reinstatement."
You may pay additional premiums at any time prior to the scheduled maturity
date, subject to the following limitations:
- - The minimum premium that we will accept is $50 or the amount required to keep
the policy in force.
- - We reserve the right to refund any excess premiums that would cause the policy
to fail to meet the definition of life insurance under the Internal Revenue
Code.
- - 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.
- - Any premium payment in excess of $1,000,000 is subject to our approval.
ALLOCATION OF PREMIUM PAYMENTS -- The initial Net Premium (and any
additional Net Premiums received by us before the end of the right to examine
period) will be allocated to the Hartford Money Market Sub-Account on the later
of the Policy Date or the date we receive your premium payment.
We will then allocate the Account Value in the Hartford Money Market
Sub-Account to the Fixed Account and the Sub-Accounts according to the premium
allocation specified in the your policy application upon the expiration of the
right to examine policy period, or the date we receive the final requirement to
put the policy in force, whichever is later.
You may change your premium allocation upon request in writing. Subsequent
Net Premiums will be allocated to the Fixed Account and the Sub-Accounts
according to your most recent written instructions as long as the number of
investment choices you are allocated to does not exceed nine (9), and the
percentage you allocate to each Sub-Account and/or the Fixed Account is in whole
percentages. If we receive a premium payment with a premium allocation
instruction that does not comply with the above rules, we will allocate the Net
Premium pro rata based on the values of your existing investment choices.
A Policy Owner receives several different types of notifications as to what
his or her current premium allocation is. Each transaction confirmation received
after a premium payment is received by Hartford will show how a Net Premium has
been allocated. Additionally, each quarterly statement summarizes the current
premium allocation in effect for such Policy.
ACCUMULATION UNITS -- Net Premiums allocated to the Sub-Accounts are used to
credit accumulation units to such Sub-Accounts.
The number of accumulation units in each Sub-Account to be credited to a
policy (including the initial allocation to the Hartford Money Market
Sub-Account) and the amount to be credited to the Fixed Account will be
determined, first, by multiplying the Net Premium by the appropriate allocation
percentage in order to determine the portion of Net Premiums or transferred
Account Value to be invested in the Fixed Account or the Sub-Account. Each
portion of the Net Premium or transferred Account Value to be invested in a
Sub-Account is then divided by the accumulation unit value in a particular
Sub-Account next computed following its receipt. The resulting figure is the
number of accumulation units to be credited to each Sub-Account.
ACCUMULATION UNIT VALUES -- 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 the 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
<PAGE>
HARTFORD LIFE AND ANNUITY INSURANCE COMPANY 13
- --------------------------------------------------------------------------------
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
us at the National Service Center, provided such date is a Valuation Day;
otherwise such determination will be made on the next succeeding date which is a
Valuation Day.
ACCOUNT VALUES -- Each 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 will vary to reflect the investment
experience of the Sub-Accounts, the interest credited to the Fixed Account and
the Loan Account, and the Monthly Deduction Amounts, Net Premiums paid, and any
withdrawals taken.
A policy's Account Value is related to the net asset value of the Funds
associated with the Sub-Accounts, if any, to which Net Premiums on the policy
have been allocated. The Account Value in the Sub-Accounts on any Valuation Day
is calculated by, first, multiplying the number of accumulation units in each
Sub-Account as of the Valuation Day by the then current value of the
accumulation units in that Sub-Account and then totaling the result for all of
the Sub-Accounts. A policy's Account Value equals the policy's value in all of
the Sub-Accounts, the Fixed Account, and the Loan Account. A policy's Cash Value
is equal to the Account Value less any applicable surrender charges. A policy's
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,"
above.
We will pay death proceeds, Cash Surrender Values, partial withdrawals, and
loan amounts allocable to the Sub-Accounts within seven 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 Commission or the Commission declares that an emergency
exists.
DEATH BENEFITS AND
POLICY VALUES
DEATH BENEFIT -- Your policy provides for the payment of the death proceeds
to the named beneficiary upon receipt of due proof of the death of the last
surviving insured. Your policy will be effective on the Policy Date only after
we receive all outstanding delivery requirements and the initial premium
payment. You must notify us in writing as soon as possible after the death of
either insured. 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 you select, the minimum death benefit provision, and whether or
not the Death Benefit Guarantee is in effect.
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 benefit under
each option is as follows:
1. Under Option A, the current Face Amount.
2. Under Option B, the current Face Amount plus the Account Value on the date
we receive due proof of the last surviving insured's death.
3. Under Option C, the current Face Amount plus the lesser of: (a) the sum of
the premiums paid; or (b) $2.5 million.
DEATH BENEFIT OPTION CHANGES -- You may change your death benefit option.
You must notify us of the change in writing. You may change Option C or Option B
to Option A. 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 to
Option B. 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.
SETTLEMENT OPTIONS -- Proceeds under your policy may be paid in a lump sum
or may be applied to one of our four settlement options. The minimum amount that
may be placed under a settlement option is $5,000 (unless we consent to a lesser
amount), subject to our then-current rules. Once payments under the Second
Option, the Third Option or the Fourth Option begin, no surrender may be made
for a lump sum settlement in lieu of the life insurance payments. The following
payment options are available to you or your beneficiary. If a payment option is
not selected, proceeds will be paid in a lump sum. Your beneficiary may choose a
settlement.
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
<PAGE>
14 HARTFORD LIFE AND ANNUITY INSURANCE COMPANY
- --------------------------------------------------------------------------------
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 one 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 policy provides 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,
we 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 with 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. We 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.
Other arrangements for income payments may be agreed upon.
MINIMUM DEATH BENEFIT -- Your policy has a 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 year. This percentage varies according to the policy year and each
insured's issue age, sex (where unisex rates are not used) and insurance class.
EXAMPLES OF MINIMUM DEATH BENEFIT:
<TABLE>
<CAPTION>
A B
---------- ----------
<S> <C> <C>
Face Amount............................ $ 100,000 $ 100,000
Account Value.......................... 46,500 34,000
Specified Percentage................... 250% 250%
Death Benefit Option................... Level Level
</TABLE>
In Example A, the 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 payable to the
beneficiary.
In Example B, the 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%).
UNSCHEDULED INCREASES AND DECREASES IN FACE AMOUNT -- At any time after the
first policy year, you may 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 a policy to no more than one in any 12 month period.
All requests to increase the Face Amount must be applied for on a new
application and accompanied by your policy. All requests will be subject to
evidence of insurability satisfactory to us. Any increase approved by us will be
effective on the Monthly Activity 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. Each unscheduled increase in Face Amount
is subject to an increase fee of 1/12 of $1 per $1,000 of each increase per
month for the first twelve months from the effective date of each increase. This
amount will not be less than 1/12 of $500 but not greater than 1/12 of $3,000.
A decrease in the Face Amount will be effective on the Monthly Activity Date
following the date we receive your request in writing. The remaining Face Amount
must not be less than that specified in our minimum rules then in effect. If
during the surrender charge period, you decrease your Face Amount to an amount
lower than it has ever been, a partial surrender charge will 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 new Face Amount from the lowest previous Face Amount; and
(ii) dividing that difference by the lowest previous Face Amount.
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 surrender charges.
<PAGE>
HARTFORD LIFE AND ANNUITY INSURANCE COMPANY 15
- --------------------------------------------------------------------------------
BENEFITS AT MATURITY -- The scheduled maturity date is the last date on
which you may elect to make premium payments. Unless you elect to continue the
policy beyond this date, the policy will terminate and any Cash Surrender Value
will be paid to you.
If elected, the policy may continue in force after the scheduled maturity
date if (a) the policy was in force on the scheduled maturity date; and (b) the
owner of the policy (including any assignee of record) agrees in writing to this
continuation.
At the scheduled maturity date:
- - the death benefit will be reduced to the Account Value;
- - the Account Value, if any, will continue to fluctuate with investment
performance
- - any loans will continue to accrue interest and become part of Indebtedness
- - no future Monthly Deduction Amounts will be deducted
- - no further premium payments will be accepted.
All additional benefits provided by rider will deem to have terminated at
the scheduled maturity date.
Otherwise, the policy will terminate on the scheduled maturity date.
CHARGES AND CONTRACT VALUES -- Your contract values decrease due to the
deduction of policy charges. Contract values may increase or decrease depending
on investment performance; investment expenses and fees reduce the investment
performance of the Sub-Accounts. Fluctuations in your account value may have an
effect on your death benefit. If you contract lapses, the contract terminates
and no death benefit will be paid.
MAKING WITHDRAWALS FROM
YOUR POLICY
SURRENDER -- Provided your policy has a Cash Surrender Value, you may
surrender your policy to us. In such case you may be subject to a surrender
charge, see "Surrender Charge." We will pay you the Cash Surrender Value. Our
liability under the policy will cease as of the date of your request for
surrender, or the date you request to have your policy surrendered, if later.
WITHDRAWALS -- One withdrawal is allowed per calendar month. Withdrawals may
be subject to a surrender charge, see "Surrender Charge." You may request a
withdrawal in writing. The minimum withdrawal allowed is $500. The maximum
partial withdrawal is the Cash Surrender Value, minus $1,000. If the death
benefit option then in effect is Option A or Option C, the Face Amount will be
reduced by the amount of any partial withdrawal. Unless specified, the
withdrawal will be deducted on a pro rata basis from the Fixed Account and the
Sub-Accounts. You may be assessed a charge of up to $10 for each partial
withdrawal.
RIGHT TO EXAMINE A POLICY -- You have a limited right to return your policy
for cancellation. You may deliver or mail the policy to us or to the agent from
whom it was purchased any time during your free look period. Your free look
period begins on the day you get your policy and ends ten days after you get it
(or longer in some states). In such 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 the agent from whom it was
purchased; and, ii) any deductions under the policy or charges associated with
the Separate Account. If your policy is replacing another policy, your free look
period and the amount paid to you upon the return of your policy vary by state.
LOANS
AVAILABILITY OF LOANS -- At any time while the policy is in force, you may
borrow against the policy by assigning it as sole security to us. 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.
Unless you specify otherwise, all loan amounts will be transferred on a pro
rata basis from the Fixed Account and each of the Sub-Accounts to the Loan
Account.
If total Indebtedness equals or exceeds the Cash Value on any Monthly
Activity Date, the policy will then go into default. See "Lapse and
Reinstatement."
PREFERRED INDEBTEDNESS -- If, at any time after the tenth (10th) policy
anniversary, your Account Value exceeds the total of all premiums paid since
issue, a portion of your Indebtedness may qualify as preferred. Preferred
Indebtedness is charged a lower interest rate than non-preferred Indebtedness,
if any. The maximum amount of preferred Indebtedness is the amount by which the
Account Value exceeds the total premiums paid and is determined on each Monthly
Activity Date.
LOAN REPAYMENTS -- You can repay all or any part of a loan at any time while
your policy is in force and either of the insureds' is alive. The amount of your
policy loan repayment will be deducted from the Loan Account. It will be
allocated among the Fixed Account and Sub-Accounts in the same percentage as
premiums are allocated.
EFFECT OF LOANS ON ACCOUNT VALUE -- A loan, whether or not repaid, will have
a permanent effect on your Account Value. This effect occurs because the
investment results of each Sub-Account will apply only to the amount remaining
<PAGE>
16 HARTFORD LIFE AND ANNUITY INSURANCE COMPANY
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in such Sub-Accounts. In addition, the rate of interest credited to the Fixed
Account will usually be different than the rate credited to the Loan Account.
The longer a loan is outstanding, the greater the effect on your Account Value
is likely to be. Such effect could be favorable or unfavorable. If the Fixed
Account and the Sub-Accounts earn more than the annual interest rate for funds
held in the Loan Account, your Account Value will not increase as rapidly as it
would have had no loan been made. If the Fixed Account and the Sub-Accounts earn
less than the Loan Account, then your Account Value will be greater than it
would have been had no loan been made. Additionally, if not repaid, the
aggregate amount of the outstanding Indebtedness will reduce the death proceeds
and the Cash Surrender Value otherwise payable.
CREDITED INTEREST -- Any amounts in the Loan Account will be credited with
interest at an annual rate of 3.5%.
INTEREST CHARGED ON INDEBTEDNESS -- Interest will accrue daily on the
Indebtedness at the policy loan rate. Because the interest charged on
Indebtedness may exceed the rate 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.
POLICY LOAN RATES -- The table below shows the interest rates we will charge
on your Indebtedness.
<TABLE>
<CAPTION>
INTEREST RATE
DURING POLICY PORTION OF CHARGED
YEARS INDEBTEDNESS EQUALS 3.5% PLUS:
- ------------------ ---------------------- --------------------
<S> <C> <C>
1-10 All 2%
11 and later Preferred 0%
Non-Preferred 1%
</TABLE>
LAPSE AND REINSTATEMENT
During the first policy year, the policy will go into 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 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.
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 lapse notice warning you
that the policy is in danger of terminating. That lapse notice will tell you the
minimum premium required to keep the policy from terminating. This minimum
premium equals the amount 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 know address, and to any
assignee of record.
GRACE PERIOD -- We will keep your policy in force 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 lapse notice) by the end of the policy Grace Period, the policy will
terminate unless the Death Benefit Guarantee is in effect. If the last surviving
insured dies during the Grace Period, we will pay the death benefit.
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 available, as
described below.
The Death Benefit Guarantee is available so long as:
(a) the Policy is in the Death Benefit Guarantee Period; and
(b) on each Monthly Activity Date during that period, the cumulative premiums
paid into the Policy, less Indebtedness and less withdrawals from the
policy, equal or exceed an amount known as the Cumulative Death Benefit
Guarantee Premium.
The Death Benefit Guarantee Period is determined at issue, based on each
insured's age, sex and risk classification. Some states may limit the maximum
length of the Death Benefit Guarantee Period. The Cumulative Death Benefit
Guarantee Premium is the premium required to maintain the Death Benefit
Guarantee.
If the Death Benefit Guarantee is available and you fail to pay the required
premium as defined in your lapse notice by the end of the policy grace period,
the Death Benefit Guarantee will then go into effect. The policy will remain in
force, however:
(a) all riders will terminate;
(b) the Death Benefit Option becomes Level;
(c) The Face Amount will be reduced to the Death Benefit Guarantee Amount; and
(d) Any future scheduled Increases in the Face Amount will be canceled.
The Death Benefit Guarantee Amount is the amount selected by you at the time
you apply for the policy. It is the death benefit while the Death Benefit
Guarantee is in effect.
As long as the Policy remains in default and the Death Benefit Guarantee is
available, the Death Benefit Guarantee will remain in effect on each subsequent
Monthly Activity Dates. You may be required to make premium payments to
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HARTFORD LIFE AND ANNUITY INSURANCE COMPANY 17
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keep the Death Benefit Guarantee available, as described above.
If during the Death Benefit Guarantee Period, the Face Amount is decreased
below the current Death Benefit Guarantee Amount, the Death Benefit Guarantee
Amount will become the new Face Amount. A new monthly Death Benefit Guarantee
Premium will be calculated. We will send you a 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 and 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 to you and
any assignee a notice. That notice will warn you that you are in danger of
losing the Death Benefit Guarantee and will tell you the amount of premium you
need to pay 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. If the Death
Benefit Guarantee was in effect, the policy will terminate at the end of the
Death Benefit Guarantee Grace Period.
REINSTATEMENT -- Unless the policy has been surrendered for its Cash
Surrender Value, the policy may be reinstated prior to the maturity date,
provided:
(a) the insureds alive at the end of the grace period are also alive on the date
of reinstatement;
(b) You make your request in writing within five years from the date the policy
lapsed;
(c) Your submit to us satisfactory evidence of insurability;
(d) any policy Indebtedness is repaid or carried over to the reinstated policy;
and
(e) You pay sufficient premium to (1) cover all Monthly Deduction Amounts that
are due and unpaid during the Grace Period and (2) keep your policy in force
for three months after the date of reinstatement.
The Account Value on the reinstatement date will reflect:
(a) the Cash Value at the time of termination; plus
(b) Net Premiums derived from 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 as though the policy had never lapsed.
TAXES
GENERAL
SINCE THE TAX LAW IS COMPLEX AND SINCE TAX CONSEQUENCES WILL VARY ACCORDING
TO THE ACTUAL STATUS OF THE POLICY OWNER INVOLVED AND THE TYPE OF PLAN UNDER
WHICH THE POLICY IS PURCHASED, LEGAL AND TAX ADVICE MAY BE NEEDED BY A PERSON,
TRUSTEE, OR OTHER ENTITY CONTEMPLATING THE PURCHASE OF A POLICY DESCRIBED
HEREIN.
It should be understood that any detailed description of the federal income
tax consequences regarding the purchase of these Policies 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 Hartford's understanding of existing federal income
tax laws as they are currently interpreted.
TAXATION OF HARTFORD
AND THE SEPARATE ACCOUNT
The Separate Account is taxed as a part of the Hartford which is taxed as a
life insurance company under Subchapter L of the 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 "Accumulation
Unit Values.") As a result, such investment income and realized capital gains
are automatically applied to increase reserves under the Policy.
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 Separate Account for
federal income taxes. If 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.
<PAGE>
18 HARTFORD LIFE AND ANNUITY INSURANCE COMPANY
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INCOME TAXATION OF POLICY BENEFITS-GENERALLY
For federal income tax purposes, the Policies should be treated as life
insurance policies under Section 7702 of the Code. The death benefit under a
life insurance policy is generally excluded from the gross income of the
Beneficiary. Also, a life insurance policy owner is generally not taxed on
increments in the policy value until the policy is partially or completely
surrendered. Section 7702 limits the amount of premiums that may be invested in
a policy that is treated as life insurance. Hartford intends to monitor premium
levels to assure compliance with the Section 7702 requirements.
Although Hartford believes that the Last Survivor Policies are in compliance
with Section 7702 of the Code, the manner in which Section 7702 should be
applied to certain features of a joint survivorship life insurance contract is
not directly addressed by Section 7702. In the absence of final regulations or
other guidance issued under Section 7702, there is necessarily some uncertainty
whether a last survivor life insurance policy will meet the Section 7702
definition of a life insurance contract. Hartford also believes that any loan
received under a Policy will be treated as Indebtedness of the Policy Owner
provided the Policy is not a Modified Endowment Contract, and that no part of
any loan under a Policy will constitute income to the Policy Owner. A surrender
or assignment of the Policy may have tax consequences depending upon the
circumstances. Policy Owners should consult a qualified tax adviser concerning
the effect of such changes.
During the first fifteen Policy 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 Policy.
The Last Survivor Exchange Option Rider permits, under limited
circumstances, a Policy to be split into two individual policies on the life of
each of the Insureds. A Policy split may have adverse tax consequences. It is
not clear whether a Policy split will be treated as a nontaxable exchange or
transfer under the Code. Unless a Policy split is so treated, among other
things, the split or transfer will result in the recognition of taxable income
on the gain in the Policy. In addition, it is not clear whether, in all
circumstances, the individual policies that result from a Policy split would be
treated as life insurance policies under Section 7702 of the Code or would be
classified as modified endowment contracts. The Policy Owner should consult a
qualified tax adviser regarding the possible adverse tax consequences of a
Policy split.
The Maturity Date Extension Provision allows a Policy Owner to extend the
Scheduled Maturity Date to the date of the death of the last surviving insured.
If the Scheduled Maturity Date of the Policy is extended, Hartford believes the
Policy 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 Policy 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 Policy Owner should consult a qualified tax
adviser regarding the possible adverse tax consequences resulting from an
extension of the Scheduled Maturity Date.
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 Policy is not treated as
a life insurance contract, the Policy 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 Policy Owner must agree to pay the tax due for the period during which the
diversification requirements were not met.
Hartford monitors the diversification of investments in the separate
accounts and tests for diversification as required by the Code. Hartford intends
to administer all contracts subject to the diversification requirements in a
manner that will maintain adequate diversification.
<PAGE>
HARTFORD LIFE AND ANNUITY INSURANCE COMPANY 19
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OWNERSHIP OF THE ASSETS IN
THE SEPARATE ACCOUNT
In certain circumstances, variable life insurance contract owners may be
considered the owners, for federal income tax purposes, of the assets of a
segregated asset account, such as the Separate Account, used to support their
contracts. In those circumstances, income and gains from the segregated asset
account would be includible in the contract owners' gross income. The Internal
Revenue Service (the "IRS") has stated in published rulings that a variable
contract owner will be considered the owner of the assets of a segregated asset
account if the owner possesses certain incidents of ownership in those assets,
such as the ability to exercise investment control over the assets. In addition,
the Treasury Department announced, in connection with the issuance of
regulations concerning investment diversification, that those 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." This announcement also stated that guidance would be issued by way of
regulations or rulings on the "extent to which policyholders may direct their
investments to particular sub-accounts [of a segregated asset account] without
being treated as owners of the underlying assets." As of the date of this
Prospectus, no such guidance has been issued.
The ownership rights under the contract are similar to, but different in
certain respects from, those described by the IRS in rulings in which it was
determined that contract owners were not owners of the assets of a segregated
asset account. For example, a Policy Owner of this Policy has the choice of more
investment options to which to allocate premium payments and Separate Account
Values, and may be able to transfer among investment options more frequently,
than in such rulings. These differences could result in the Owner being treated
as the owner of a portion of the assets of the Separate Account. In addition,
Hartford does not know what standards will be set forth in the regulations or
rulings that the Treasury Department has stated it expects to issue. Hartford
therefore reserves the right to modify the contract as necessary to attempt to
prevent Policy Owners from being considered the owners of the assets of the
Separate Account. However, there is no assurance that such efforts would be
successful.
TAX DEFERRAL DURING ACCUMULATION PERIOD
Under existing provisions of the Code, except as described below, any
increase in a Policy Owner's contract value is generally not taxable to the
Policy Owner unless amounts are received (or are deemed to be received) under
the contract prior to the Insured's death. If there is a total withdrawal from
the contract, then the surrender value will be includible in the Policy Owner's
income to the extent that the amount received exceeds the "investment in the
contract." (If there is any debt at the time of a total withdrawal, then such
debt will be treated as an amount distributed to the Policy Owner.) The
"investment in the contract" is the aggregate amount of premium payments and
other consideration paid for the contract, less the aggregate amount received
under the contract previously to the extent such amounts received were
excludable from gross income. Whether partial withdrawals (or such other amounts
deemed to be distributed) from the contract constitute income to the Policy
Owner depends, in part, upon whether the contract is considered a modified
endowment contract for federal income tax purposes.
MODIFIED ENDOWMENT CONTRACTS
Code Section 7702A applies an additional test, the "seven-pay" test, to life
insurance contracts. The seven-pay test provides that premiums cannot be paid at
a rate more rapidly than that allowed by the payment of seven annual premiums
using specified computational rules described in Section 7702A(c). A modified
endowment contract ("MEC") is a life insurance policy that either: (i) satisfies
the Section 7702 definition of life insurance, but fails the seven-pay test of
Section 7702A or (ii) is exchanged for a MEC. A policy fails the seven-pay test
if the accumulated amount paid into the Policy at any time during the first
seven Policy Years exceeds the sum of the net level premiums that would have
been paid up to that point if the Policy provided for paid-up future benefits
after the payment of seven level annual premiums. Computational rules for the
seven-pay test are described in Section 7702A(c).
If the Policy satisfies the seven-pay test at issuance, distributions,
withdrawals and loans made thereafter will not be subject to the MEC rules,
unless the Policy is changed materially. The seven-pay test will be applied anew
at any time the Policy undergoes a material change, which includes an increase
in the Face Amount. In addition, if there is a reduction in benefits under the
Policy, all previous seven-pay test periods need to be retested as if the Policy
had initially been issued at the reduced benefit level. Any reduction in
benefits attributable to the nonpayment of premiums will not be taken into
account for purposes of the seven-pay test if the benefits are reinstated within
90 days after the reduction.
A policy that is classified as a MEC is eligible for certain aspects of 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, if the Policy is classified as a MEC, then withdrawals from
the Policy will be considered first as distribution of income and then as a
recovery of premium payments. Thus, distributions will be includible in income
to the extent the contract value exceeds the investment in the contract. The
amount of any loan (including unpaid
<PAGE>
20 HARTFORD LIFE AND ANNUITY INSURANCE COMPANY
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interest thereon) under the policy will be treated as a distribution from the
contract for tax purposes. In addition, if the Policy Owner assigns or pledges
any portion of the value of a contract (or agrees to assign or pledge any
portion), then such portion will be treated as a withdrawal from the contract
for tax purposes. Taxable withdrawals are subject to an additional 10% tax, with
certain exceptions. The Policy Owner's investment in the contract is increased
by the amount includible in income with respect to such assignment, pledge, or
loan, though it is not affected by any other aspect of the assignment, pledge,
or loan (including its release or repayment).
Generally, only distributions and loans made in the first year in which a
Policy becomes a MEC, and in subsequent years, are taxable. However,
distributions and loans made in the two years prior to a policy's failing the
seven-pay test are deemed to be in anticipation of failure and are subject to
tax.
Before assigning, pledging, or requesting a distribution under a contract
that is a MEC, a Policy Owner should consult a qualified tax adviser.
All MEC policies that are issued within any calendar year to the same policy
owner by one company or its affiliates are treated as one MEC policy for the
purpose of determining the taxable portion of any distribution.
Hartford has instituted procedures to monitor whether a Policy may become
classified as a MEC after issue.
ESTATE AND GENERATION SKIPPING TAXES
When the last surviving Insured dies, the Death Proceeds will generally be
includible in the Policy Owner's estate for purposes of federal estate tax if
the last surviving Insured owned the Policy. If the Policy Owner was not the
last surviving Insured, the fair market value of the Policy would be included in
the Policy Owner's estate upon the Policy Owner's death. The Policy would not 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.
The federal estate tax is integrated with the federal gift tax under a
unified rate schedule and unified credit which shelters up to $625,000 (1998)
from the estate and gift tax. The Taxpayer Relief Act of 1997 gradually raises
the credit over the next eight years to $1,000,000. In addition, an unlimited
marital deduction may be available for federal estate and gift tax purposes. The
unlimited marital deduction permits the deferral of taxes until the death of the
surviving spouse.
If the Policy Owner (whether or not he or she is an Insured) transfers
ownership of the Policy 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 Policy. 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 Policy
Owner should consult with a qualified tax adviser for specific information if
ownership is passing to younger generations.
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 Policy Owner,
such amounts will be subject to federal income tax withholding and reporting,
pursuant to the Code.
NON-INDIVIDUAL OWNERSHIP OF POLICIES
In certain circumstances, the Code limits the application of specific tax
advantages to individual owners of life insurance contracts. Prospective Policy
Owners which are not individuals should consult a qualified tax adviser to
determine the potential impact on the purchaser.
OTHER
Federal estate tax, state and local estate, inheritance and other tax
consequences of ownership, or receipt of Policy proceeds depend on the
circumstances of each Policy Owner or beneficiary. A qualified 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
<PAGE>
HARTFORD LIFE AND ANNUITY INSURANCE COMPANY 21
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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 adviser regarding U.S., state, and
foreign taxation with respect to a life insurance policy purchase.
LEGAL PROCEEDINGS
There are no pending material legal proceedings to which the Separate
Account is a party.
OTHER MATTERS
YEAR 2000 -- The Year 2000 issue relates to the ability or inability of
computer systems to properly process information and data containing or related
to dates beginning with the year 2000 and beyond. The Year 2000 issue exists
because, historically, many computer systems that are in use today were
developed years ago when a year was identified using a two-digit field rather
than a four-digit field. As information and data containing or related to the
century date are introduced to computer hardware, software and other systems,
date sensitive systems may recognize the year 2000 as 1900, or not at all, which
may result in computer systems processing information incorrectly. This, in
turn, may significantly and adversely affect the integrity and reliability of
information databases and may result in a wide variety of adverse consequences
to a company. In addition, Year 2000 problems that occur with third parties with
which a company does business, such as suppliers, computer vendors and others,
may also adversely affect any given company.
As an insurance and financial services company, Hartford has thousands of
individuals and business customers that have purchased or invested in insurance
policies, annuities, mutual funds and other financial products. Nearly all of
these policies and products contain date sensitive data, such as policy
expiration dates, birth dates, premium payment dates and the like. In addition,
Hartford has business relationships with numerous third parties that affect
virtually all aspects of its business, including, without limitation, suppliers,
computer hardware and software vendors, insurance agents and brokers, securities
broker-dealers and other distributors of financial products.
Beginning in 1990, Hartford began working on the making its computer systems
Year 2000 ready, either by installing new programs or by replacing systems. In
January 1998, Hartford commenced a company-wide program to further identify,
assess and remediate the impact of Year 2000 problems in all of Hartford's
business segments. Hartford currently anticipates that this internal program
will be substantially completed by the end of 1998, and testing of computer
systems will continue through 1999.
In addition, as part of its Year 2000 program, Hartford is identifying third
parties with which it has significant business relations in order to attempt to
assess any potential impact on Hartford as a result of such third-party Year
2000 issues and remediation plans. Hartford currently anticipates that it will
substantially complete this evaluation by the end of 1998, and will conduct
systems testing with certain third parties through 1999. Hartford does not have
control over these third parties and, as a result, Hartford cannot currently
determine to what extent future operating results may be adversely affected by
the failure of these third parties to successfully address their Year 2000
issues. Hartford will continue to assess Year 2000 risk exposures related to its
own operations and its third party relationships and is in the process of
developing contingency plans.
The costs of addressing the Year 2000 issue that have been incurred through
the six months ended June 30, 1998 have not been material to Hartford's
financial condition or results of operations. Hartford will continue to incur
costs related to its Year 2000 efforts and does not anticipate that the costs to
be incurred will be material to its financial condition or results of
operations.
FINANCIAL STATEMENTS
[To be filed by amendment]
<PAGE>
22 HARTFORD LIFE AND ANNUITY INSURANCE COMPANY
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GLOSSARY OF SPECIAL TERMS
ACCOUNT VALUE: the total of all amounts in the Fixed Account, Loan Account and
Sub-Accounts.
CASH SURRENDER VALUE: the Cash Value less all Indebtedness.
CASH VALUE: the Account Value less any applicable Surrender Charges.
DEATH BENEFIT GUARANTEE AMOUNT: a benefit amount selected by you at the time you
apply for the policy. This is the death benefit that will apply to your policy
while the Death Benefit Guarantee is in effect.
FACE AMOUNT: an amount we use to determine the Death Benefit. On the policy
date, the Face Amount equals the initial Face Amount shown in your policy.
Thereafter, it may change under the terms of the policy.
FIXED ACCOUNT: part of our general account to which all or a portion of the
Account Value may be allocated.
FUNDS: the registered open-end management companies in which assets of the
Separate Account may be invested.
INDEBTEDNESS: all loans taken on the policy, plus any interest due or accrued
minus any loan repayments.
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 Account Value. It is premium paid
minus the sales load and premium tax charge.
SEPARATE ACCOUNT: an account 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 our other assets.
SUB-ACCOUNT: the subdivisions of the Separate Account.
SURRENDER CHARGE: a charge that may be assessed if you surrender your policy or
the Face Amount is decreased.
VALUATION DAY: the date on which a Sub-Account is valued. This occurs every day
the New York Stock Exchange is open for trading.
WE, US, OUR: Hartford Life and Annuity Insurance Company.
YOU, YOUR: the owner of the policy.
<PAGE>
HARTFORD LIFE AND ANNUITY INSURANCE COMPANY 23
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WHERE YOU CAN FIND MORE INFORMATION
You can call us at 1-800-231-5453 to ask us questions, or to get a Statement of
Additional Information, free of charge. The Statement of Additional Information
contains more information about this life insurance policy and, like this
prospectus, is filed with the Securities and Exchange Commission. You should
read the Statement of Additional Information because you are bound by the terms
contained in it.
We file other information with the Securities and Exchange Commission. You
may read and copy any document we file at the SEC's public reference room in
Washington, DC 20549-6009. Please call the SEC at 1-800-SEC-0330 for further
information. Our SEC filings are also available to the public at the SEC's web
site at http://www.sec.gov.
<PAGE>
PART B
STATEMENT OF
ADDITIONAL INFORMATION
SEPARATE ACCOUNT VL II
HARTFORD LIFE AND ANNUITY INSURANCE COMPANY
This Statement of Additional Information is not a prospectus. We will send you
a prospectus if you write us at P.O. Box 2999, Hartford, CT 06104-2999, or if
you call us at 1-800-231-5453.
Date of Prospectus:
Date of Statement of Additional Information:
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C>
General Information and History
Services
Distribution of the Contracts
Additional Information About Charges
Financial Statements
Performance Data
</TABLE>
<PAGE>
GENERAL INFORMATION AND HISTORY
HARTFORD LIFE AND ANNUITY INSURANCE COMPANY ("HARTFORD") is a stock life
insurance company engaged in the business of writing life insurance and
annuities in all states except New York. Hartford is located in Simsbury,
Connecticut, but its mailing address is P.O. Box 2999, Hartford, CT
06104-2999. Hartford was incorporated on January 9, 1956 under the laws of
Wisconsin, and subsequently redomiciled to Connecticut. On January 1, 1998,
Hartford's name changed from ITT Hartford Life and Annuity Insurance Company
to Hartford Life and Annuity Insurance Company.
Hartford Life and Annuity Insurance Company is controlled by Hartford Life
Insurance Company, which is controlled by Hartford Life & Accident Insurance
Company, which is controlled by Hartford Life Inc., which is controlled by
Hartford Accident & Indemnity Company, which is controlled by Hartford Fire
Insurance Company, which is controlled by Nutmeg Insurance Company, which is
controlled by The Hartford Financial Services Group, Inc. Each of these
companies is engaged in the business of insurance and financial services.
SEPARATE ACCOUNT VL II was established as a separate account under
Connecticut law on September 30, 1994. The Separate Account is classified as
a unit investment trust registered with the Securities and Exchange
Commission under the Investment Company Act of 1940.
SERVICES
SAFEKEEPING OF ASSETS Title to the assets of the Separate Account is held by
Hartford. The assets are kept physically segregated and are held separate
and apart from Hartford's general corporate assets. Records are maintained
of all purchases and redemptions of Fund shares held in each of the
Sub-Accounts.
INDEPENDENT PUBLIC ACCOUNTANTS The audited financial statements included in
this registration statement have been audited by Arthur Andersen LLP,
independent public accountants, as indicated in their reports with respect
thereto, and are included herein in reliance upon the authority of said firm
as experts in giving said reports. Reference is made to the report on the
statutory financial statements of Hartford Life and Annuity Insurance Company
(formerly ITT Hartford Life and Annuity Insurance Company) which states the
statutory financial statements are presented in accordance with statutory
accounting practices prescribed or permitted by the National Association of
Insurance Commissioners and the State of Connecticut Insurance Department,
and are not presented in accordance with generally accepted accounting
principles. The principal business address of Arthur Andersen LLP is One
Financial Plaza, Hartford, Connecticut 06103.
DISTRIBUTION OF CONTRACTS
Hartford Securities Distribution Company, Inc. ("HSD") serves as principal
underwriter for the policies and is located at the same address as Hartford.
HSD is controlled by Hartford. HSD offers the policies on a continous basis.
<PAGE>
The policies will be sold by salespersons of HSD, who represent Hartford as
insurance agents and who are registered representatives of broker-dealers who
have entered into distribution agreements with HSD.
HSD is registered with the Securities and Exchange Commission under the
Securities Exchange Act of 1934 as a broker-dealer and is a member of the
National Association of Securities Dealers, Inc. ("NASD").
ADDITIONAL INFORMATION ABOUT CHARGES
SALES LOAD The maximum sales load under the policy is 6% of premium.
REDUCED CHARGES FOR ELIGIBLE GROUPS Certain of the charges and deductions
described above may be reduced for policies issued in connection with a
specific plan, in accordance with our rules in effect as of the date the
application for a policy is approved. To qualify for such a reduction, a plan
must satisfy certain criteria, E.G., as to 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
policies are purchased and certain characteristics of the plan's members. The
amount of reduction and the criteria for qualification will be reflected in
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 invested in Separate Account VL II.
UNDERWRITING PROCEDURES To purchase a policy you must submit an application
to us. Within limits, you may choose the initial Face Amount. Policies
generally will be issued only on the lives of insureds between the ages of 20
and 85 who supply evidence of insurability satisfactory to us. Acceptance is
subject to our underwriting rules and we reserve the right to reject an
application for any reason. No change in the terms or conditions of a policy
will be made without your consent.
Cost of insurance rates will be determined on each policy anniversary based
on our future expectations of such factors as mortality, expenses, interest,
persistency and taxes. For preferred and standard risks, the cost of
insurance rate will not exceed those based on the 1980 Commissioners'
Standard Ordinary Mortality Table (ALB), Male or Female, Nonsmoker or Smoker
Table, age last birthday (unisex rates may be required in some states). A
table of guaranteed cost of insurance rates per $1,000 will be included in
your policy, however, we reserve the right to use rates less than those shown
in the table. Special risk classes are used when mortality experience in
excess of the standard risk classes is expected. These substandard risks will
be charged a higher
<PAGE>
cost of insurance rate that will not exceed rates based on a multiple of 1980
Commissioners' Standard Ordinary Mortality Table (ALB), Male or Female,
Nonsmoker or Smoker Table, age last birthday (unisex rates may be required in
some states) plus any flat extra amount assessed. The multiple will be based
on the insured's substandard rating.
INCREASES IN FACE AMOUNT At any time after the first policy year, you may
request in writing to change the Face Amount. The minimum amount by which
the Face Amount can be increased is based on our rules then in effect.
We reserve the right to limit the number of increases or decreases made under
a policy to no more than one in any 12 month period.
All requests to increase the Face Amount must be applied for on a new
application and accompanied by your policy. All requests will be subject to
evidence of insurability satisfactory to us. Any increase approved by us will
be effective on the Monthly Activity 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. Each unscheduled
increase in Face Amount is subject to an increase fee of 1/12 of $1 per
$1,000 of each increase per month for the first twelve months from the
effective date of each increase. This amount will not be less than 1/12 of
$500 but not greater than 1/12 of $3,000.
FINANCIAL STATEMENTS
[To be filed by amendment]
PERFORMANCE DATA
[To be filed by amendment]
<PAGE>
PART C
OTHER INFORMATION
Item 27. Exhibits
(a) Resolution of the Board of Directors of Hartford Life and
Annuity Insurance Company ("Hartford") authorizing the
establishment of the Separate Account.(1)
(b) Not Applicable.
(c) Principal Underwriting Agreement.(1)
(d) Form of Flexible Premium Variable Life Insurance Policy.
(e) Form of Application for Flexible Premium Variable Life Insurance
Policies.
(f) Certificate of Incorporation of Hartford(2) and Bylaws of
Hartford(1).
(g) Reinsurance Contracts to be filed by Amendment.
(h) Form of Participation Agreements to be filed by Amendment.
(i) Not Applicable.
(j) Not Applicable.
(k) Opinion and consent of Lynda Godkin, Senior Vice President,
General Counsel and Corporate Secretary.
(l) Not Applicable.
(m) Not Applicable.
(n) Consent of Arthur Andersen LLP, Independent Public Accountants
to be filed by Amendment.
(o) No financial statement will be omitted.
(p) Not Applicable.
- ---------------------------------------
(1) Incorporated by reference to Post-Effective Amendment No. 1 to the
Registration Statement on Form S-6, File No. 33-89990, of Hartford Life
Insurance Company filed with the Securities and Exchange Commission on
May 1, 1996.
(2) Incorporated by reference to Post-Effective Amendment No. 2 to the
Registration Statement on Form S-6, File No. 33-89990, of Hartford Life
Insurance Company filed with the Securities and Exchange Comission on
April 16, 1997.
<PAGE>
(q) Memorandum describing transfer and redemption procedures.(1)
Item 28. Officers and Directors.
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------
NAME, AGE POSITION WITH HARTFORD
- ------------------------------------------------------------------------------------------------------------------
<S> <C>
Wendell J. Bossen Vice President
- ------------------------------------------------------------------------------------------------------------------
Gregory A. Boyko Senior Vice President, Chief Financial Officer, and Treasurer,
Director*
- ------------------------------------------------------------------------------------------------------------------
Peter W. Cummins Senior Vice President
- ------------------------------------------------------------------------------------------------------------------
Ann M. deRaismes Senior Vice President
- ------------------------------------------------------------------------------------------------------------------
James R. Dooley Vice President
- ------------------------------------------------------------------------------------------------------------------
Timothy M. Fitch Vice President
- ------------------------------------------------------------------------------------------------------------------
David T. Foy Vice President
- ------------------------------------------------------------------------------------------------------------------
J. Richard Garrett Vice President and Assistant Treasurer
- ------------------------------------------------------------------------------------------------------------------
Donald J. Gillette Vice President
- ------------------------------------------------------------------------------------------------------------------
John P. Ginnetti Executive Vice President
- ------------------------------------------------------------------------------------------------------------------
William A. Godfrey, III Senior Vice President
- ------------------------------------------------------------------------------------------------------------------
Lynda Godkin Senior Vice President, General Counsel, and Corporate Secretary,
Director*
- ------------------------------------------------------------------------------------------------------------------
Lois W. Grady Senior Vice President
- ------------------------------------------------------------------------------------------------------------------
Christopher Graham Vice President
- ------------------------------------------------------------------------------------------------------------------
Mark E. Hunt Vice President
- ------------------------------------------------------------------------------------------------------------------
Stephen T. Joyce Vice President
- ------------------------------------------------------------------------------------------------------------------
Michael D. Keeler Vice President
- ------------------------------------------------------------------------------------------------------------------
Robert A. Kerzner Senior Vice President
- ------------------------------------------------------------------------------------------------------------------
David N. Levenson Vice President
- ------------------------------------------------------------------------------------------------------------------
William B. Malchodi, Jr. Vice President and Director of Taxes
- ------------------------------------------------------------------------------------------------------------------
Thomas M. Marra Executive Vice President and Director, Individual Life and
Annuity Division, Director*
- ------------------------------------------------------------------------------------------------------------------
Steven L. Matthiesen Vice President
- ------------------------------------------------------------------------------------------------------------------
Michael C. O'Halloran Vice President
- ------------------------------------------------------------------------------------------------------------------
Daniel E. O'Sullivan Vice President
- ------------------------------------------------------------------------------------------------------------------
Craig D. Raymond Senior Vice President and Chief Actuary
- ------------------------------------------------------------------------------------------------------------------
David T. Schrandt Vice President
- ------------------------------------------------------------------------------------------------------------------
Lowndes A. Smith President and Chief Executive Officer, Director*
- ------------------------------------------------------------------------------------------------------------------
Raymond P. Welnicki Senior Vice President
- ------------------------------------------------------------------------------------------------------------------
Walter C. Welsh Senior Vice President
- ------------------------------------------------------------------------------------------------------------------
Lizabeth H. Zlatkus Senior Vice President
- ------------------------------------------------------------------------------------------------------------------
David M. Znamierowski Senior Vice President, Director*
- ------------------------------------------------------------------------------------------------------------------
</TABLE>
Unless otherwise indicated, the principal business address of each the above
individuals is P.O. Box 2999, Hartford, CT 06104-2999.
*Denotes date of election to Board of Directors.
<PAGE>
Item 29. Persons Controlled By or Under Common Control with the Depositor
or Registrant
Filed herewith as Exhibit 29.
Item 30: Indemnification
Under Section 33-772 of the Connecticut General Statutes,
unless limited by its certificate of incorporation, the
Registrant must indemnify a director who was wholly
successful, on the merits or otherwise, in the defense of any
proceeding to which he was a party because he is or was a
director of the corporation against reasonable expenses
incurred by him in connection with the proceeding.
The Registrant may indemnify an individual made a party to a
proceeding because he is or was a director against liability
incurred in the 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 Registrant, and, with respect to any
criminal proceeding, had no reason to believe his conduct was
unlawful. Conn. Gen. Stat. Section 33-771(a). Additionally,
pursuant to Conn. Gen. Stat. Section 33-776, the Registrant
may indemnify officers and employees or agents for liability
incurred and for any expenses to which they becomes subject by
reason of being or having been an employees or officers of the
Registrant. Connecticut law does not prescribe standards for
the indemnification of officers, employees and agents and
expressly states that their indemnification may be broader
than the right of indemnification granted to directors.
The foregoing statements are specifically made subject to the
detailed provisions of Section 33-770 et seq.
Notwithstanding the fact that Connecticut law obligates the
Registrant to indemnify a only a director that was successful
on the merits in a suit, under Article VIII, Section 1 of the
Registrant's bylaws, the Registrant must indemnify both
directors and officers of the Registrant for (1) any claims
and liabilities to which they become subject by reason of
being or having been a directors or officers of the company
and legal and (2) other expenses incurred in defending against
such claims, in each case, to the extent such is consistent
with statutory provisions.
Additionally, the directors and officers of Hartford and
Hartford Securities Distribution Company, Inc. ("HSD") are
covered under a directors and officers liability insurance
policy issued to The Hartford Financial Services Group, Inc.
and its subsidiaries. Such policy will reimburse the
Registrant for any
<PAGE>
payments that it shall make to directors and officers pursuant
to law and will, subject to certain exclusions contained in
the policy, further pay any other costs, charges and expenses
and settlements and judgments arising from any proceeding
involving any director or officer of the Registrant in his
past or present capacity as such, and for which he may be
liable, except as to any liabilities arising from acts that
are deemed to be uninsurable.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 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.
Item 31. Principal Underwriters
(a) HSD acts as principal underwriter for the following
investment companies:
<TABLE>
<S> <C>
Hartford Life Insurance Company - Separate Account One
Hartford Life Insurance Company - Separate Account Two
Hartford Life Insurance Company - Separate Account Two (DC Variable Account I)
Hartford Life Insurance Company - Separate Account Two (DC Variable Account II)
Hartford Life Insurance Company - Separate Account Two (QP Variable Account)
Hartford Life Insurance Company - Separate Account Two (Variable Account "A")
Hartford Life Insurance Company - Separate Account Two (NQ Variable Account)
Hartford Life Insurance Company - Putnam Capital Manager Trust Separate
Account
Hartford Life Insurance Company - Separate Account Three
Hartford Life Insurance Company - Separate Account Five
Hartford Life and Annuity Insurance Company - Separate Account One
Hartford Life and Annuity Insurance Company - Putnam Capital Manager
Trust Separate Account Two
</TABLE>
<PAGE>
<TABLE>
<S> <C>
Hartford Life and Annuity Insurance Company - Separate Account Three
Hartford Life and Annuity Insurance Company - Separate Account Five
Hartford Life and Annuity Insurance Company - Separate Account Six
American Maturity Life Insurance Company - Separate Account AMLVA
</TABLE>
(b) Directors and Officers of HSD
<TABLE>
<CAPTION>
Name and Principal Positions and Offices
Business Address With Underwriter
------------------ ----------------------
<S> <C>
Lowndes A. Smith President and Chief Executive Officer, Director
John P. Ginnetti Executive Vice President, Director
Thomas M. Marra Executive Vice President, Director
Peter W. Cummins Senior Vice President
Lynda Godkin Senior Vice President, General Counsel and
Corporate Secretary
Donald E. Waggaman, Jr. Treasurer
George R. Jay Controller
</TABLE>
Unless otherwise indicated, the principal business address of each the above
individuals is P.O. Box 2999, Hartford, CT 06104-2999.
Item 32. Location of Accounts and Records
All of the accounts, books, records or other documents
required to be kept by Section 31(a) of the Investment Company
Act of 1940 and rules thereunder, are maintained by Hartford
at 200 Hopmeadow Street, Simsbury, Connecticut 06089.
Item 33. Management Services
All management contracts are discussed in Part A and Part B of this
Registration Statement.
Item 34. Representation of Reasonableness of Fees
Hartford hereby represents that the aggregate fees and charges under the
Policy are reasonable in relation to the services rendered, the expenses
expected to be incurred, and the risks assumed by Hartford.
<PAGE>
SIGNATURES
----------
As required by the Securities Act of 1933 and the Investment Company Act of
1940, the Registrant has caused this Registration Statement to be signed on
its behalf, in the Town of Simsbury, and State of Connecticut, on the 16th
day of November, 1998.
HARTFORD LIFE AND ANNUITY INSURANCE
COMPANY - SEPARATE ACCOUNT VL II (Registrant)
By: /s/ Thomas M. Marra
------------------------------------------
Thomas M. Marra, Executive Vice President
& Director
HARTFORD LIFE AND ANNUITY INSURANCE COMPANY
(Depositor)
By: /s/ Thomas M. Marra
------------------------------------------
Thomas M. Marra, Executive Vice President
& Director
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.
Gregory A. Boyko, Senior Vice President,
Director *
Lynda Godkin, Senior Vice President
General Counsel and Corporate Secretary, *By: /s/ Marianne O'Doherty
Director * ----------------------
Thomas M. Marra, Executive Vice Marianne O'Doherty
President, Director * Attorney-in-Fact
Lowndes A. Smith, President,
Chief Executive Officer, Director * Dated: November 16, 1998
David M. Znamierowski, Senior Vice President,
Director *
<PAGE>
EXHIBIT INDEX
1.1 Form of Flexible Premium Variable Life Insurance Policy.
1.2 Form of Application for Flexible Premium Variable Life
Insurance Policies.
1.3 Opinion and Consent of Lynda Godkin, Senior Vice President,
General Counsel and Corporate Secretary.
1.4 Organizational Chart.
<PAGE>
EXHIBIT 1.1
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 Last Surviving
Insured's death while the Policy was in force. You must notify Us In Writing and
give Us due proof of the first death of the Insureds as soon as possible after
the death.
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 TEN DAYS AFTER YOU GET IT. 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
ELECTION OF OWNER
DEATH PROCEEDS PAYABLE AT DEATH OF LAST SURVIVING 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 DEATH BENEFIT GUARANTEE AMOUNT IS A DEATH BENEFIT
GUARANTEE SUBJECT TO THE CONDITIONS DESCRIBED ON PAGE 14.
LAST SURVIVOR FLEXIBLE PREMIUM
VARIABLE LIFE INSURANCE POLICY
[LOGO]
HARTFORD LIFE
LA-1151(98) PRINTED IN U.S.A.
<PAGE>
TABLE OF CONTENTS
PAGE
Policy Specifications 3
Definitions 5
Death Benefit 7
Increases and Decreases in Face Amount 8
Premiums 9
Valuation Provisions 10
Account Value, Cash Value
and Cash Surrender Value 11
Transfers 12
Monthly Deduction Amount 12
Lapse and Policy Grace Period 13
Reinstatement 15
Policy Loans 15
Withdrawals 16
Surrenders 17
Payments By Us 17
Taxation 17
The Contract 17
Ownership and Beneficiary 19
Termination and Maturity Date 20
Income Settlement Options 21
Any Riders follow page 22
Page 2
LA-1151(98) PRINTED IN U.S.A.
<PAGE>
POLICY SPECIFICATIONS
- ------------------------------------------------------------------------------
BASE POLICY INFORMATION
- ------------------------------------------------------------------------------
POLICY: LAST SURVIVOR FLEXIBLE
PREMIUM VARIABLE LIFE
POLICY NUMBER: VL00001
FIRST INSURED: JOHN DOE
ISSUE AGE/SEX: 35, MALE
INSURANCE CLASS: PREFERRED/NON-NICOTINE
SECOND INSURED: MARY DOE
ISSUE AGE/SEX: 35, FEMALE
INSURANCE CLASS: PREFERRED/NON-NICOTINE
OWNER: JOHN DOE
BENEFICIARY: JANE DOE
INITIAL PLANNED PREMIUM: $10,000.00
PAYMENT FREQUENCY: ANNUAL
INITIAL FACE AMOUNT: $1,000,000
DEATH BENEFIT OPTION: A (LEVEL OPTION)
DEATH BENEFIT OPTION C LIMIT: NOT APPLICABLE
DEATH BENEFIT GUARANTEE AMOUNT: $1,000,000
DEATH BENEFIT GUARANTEE PERIOD: JANUARY 1, 1999 - DECEMBER 31, 2029
MONTHLY DEATH BENEFIT
GUARANTEE PREMIUM: $617.23
POLICY DATE: JANUARY 1, 1999
DATE OF ISSUE: JANUARY 1, 1999
SCHEDULED MATURITY DATE: JANUARY 1, 2064*
ANNUAL FIXED ACCOUNT
MINIMUM CREDITED RATE: 3.5%
SEPARATE ACCOUNT: [VARIABLE LIFE TWO]
INITIAL PREMIUM ALLOCATION: [HARTFORD MONEY MARKET FUND]
* 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
1151(3) PRINTED IN U.S.A.
<PAGE>
POLICY SPECIFICATIONS
- ------------------------------------------------------------------------------
BASE POLICY INFORMATION
- ------------------------------------------------------------------------------
POLICY: LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE
LIFE
POLICY NUMBER: VL00001
FIRST INSURED: JOHN DOE
ISSUE AGE: 35
INSURANCE CLASS: PREFERRED/NON-NICOTINE
SECOND INSURED: MARY DOE
ISSUE AGE: 35
INSURANCE CLASS: PREFERRED/NON-NICOTINE
OWNER: JOHN DOE
BENEFICIARY: JANE DOE
INITIAL PLANNED PREMIUM: $10,000.00
PAYMENT FREQUENCY: ANNUAL
INITIAL FACE AMOUNT: $1,000,000
DEATH BENEFIT OPTION: A (LEVEL OPTION)
DEATH BENEFIT OPTION C LIMIT: NOT APPLICABLE
DEATH BENEFIT GUARANTEE AMOUNT: $1,000,000
DEATH BENEFIT GUARANTEE PERIOD: JANUARY 1, 1999 - DECEMBER 31, 2029
MONTHLY DEATH BENEFIT
GUARANTEE PREMIUM: $650.49
POLICY DATE: JANUARY 1, 1999
DATE OF ISSUE: JANUARY 1, 1999
SCHEDULED MATURITY DATE: JANUARY 1, 2064*
ANNUAL FIXED ACCOUNT
MINIMUM CREDITED RATE: 3.5%
SEPARATE ACCOUNT: [VARIABLE LIFE TWO]
INITIAL PREMIUM ALLOCATION: [HARTFORD MONEY MARKET FUND]
* 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 (continued)
1151(3)U PRINTED IN U.S.A.
<PAGE>
POLICY NUMBER: VL0000001
POLICY SPECIFICATIONS
- ------------------------------------------------------------------------------
ADDITIONAL BENEFITS AND RIDERS
- ------------------------------------------------------------------------------
SINGLE LIFE YEARLY RENEWABLE TERM
DESIGNATED INSURED: JOHN DOE
ISSUE AGE/SEX: 35/MALE
INSURANCE CLASS: PREFERRED NON-NICOTINE
RIDER FACE AMOUNT: $50,000
DEATH BENEIT OPTION: RETURN OF PREMIUM
FIRST YEAR MONTHLY TERM INSURANCE CHARGE: $3.04
DATE OF ISSUE: 01/01/1999
RIDER EFFECTIVE DATE: 01/01/1999
TERMINATION DATE: 01/01/2019
- ------------------------------------------------------------------------------
SINGLE LIFE YEARLY RENEWABLE TERM
DESIGNATED INSURED: MARY DOE
ISSUE AGE/SEX: 35/FEMALE
INSURANCE CLASS: PREFERRED NON-NICOTINE
RIDER FACE AMOUNT: $50,000
DEATH BENEIT OPTION: LEVEL
FIRST YEAR MONTHLY TERM INSURANCE CHARGE: $2.81
DATE OF ISSUE: 01/01/1999
RIDER EFFECTIVE DATE: 01/01/1999
TERMINATION DATE: 01/01/2019
- ------------------------------------------------------------------------------
Page 3 (continued)
1151(3 CONT'D) PRINTED IN U.S.A.
<PAGE>
POLICY NUMBER: VL0000001
POLICY SPECIFICATIONS
- ------------------------------------------------------------------------------
ADDITIONAL BENEFITS AND RIDERS
- ------------------------------------------------------------------------------
SINGLE LIFE YEARLY RENEWABLE TERM
DESIGNATED INSURED: JOHN DOE
ISSUE AGE: 35
INSURANCE CLASS: PREFERRED NON-NICOTINE
RIDER FACE AMOUNT: $50,000
DEATH BENEIT OPTION: RETURN OF PREMIUM
FIRST YEAR MONTHLY TERM INSURANCE CHARGE: $2.81
DATE OF ISSUE: 01/01/1999
RIDER EFFECTIVE DATE: 01/01/1999
TERMINATION DATE: 01/01/2019
- ------------------------------------------------------------------------------
SINGLE LIFE YEARLY RENEWABLE TERM
DESIGNATED INSURED: MARY DOE
ISSUE AGE: 35
INSURANCE CLASS: PREFERRED NON-NICOTINE
RIDER FACE AMOUNT: $50,000
DEATH BENEIT OPTION: LEVEL
FIRST YEAR MONTHLY TERM INSURANCE CHARGE: $2.34
DATE OF ISSUE: 01/01/1999
RIDER EFFECTIVE DATE: 01/01/1999
TERMINATION DATE: 01/01/2019
- ------------------------------------------------------------------------------
Page 3 (continued)
1151(3U CONT'D) PRINTED IN U.S.A.
<PAGE>
POLICY NUMBER: VL0000001
POLICY SPECIFICATIONS
POLICY CHARGES
- ------------------------------------------------------------------------------
DEDUCTIONS FROM PREMIUM PAYMENTS
- ------------------------------------------------------------------------------
TYPE OF CHARGE PERCENT OF PREMIUMS PAID
-------------- -------------------------
MAXIMUM SALES CHARGES:
----------------------
ALL POLICY YEARS 6.00%
PREMIUM TAX CHARGE:
--------------------
ALL POLICY YEARS [1.75%]*
* THE PREMIUM TAX PERCENTAGE RATE DEPENDS UPON THE RATE ASSESSED BY YOUR
STATE OR MUNICIPALITY OF RESIDENCE. IF YOUR STATE OR MUNICIPALITY OF
RESIDENCE CHANGES AND/OR IF YOUR RESIDENCE STATE OR MUNICIPALITY CHANGES
ITS PREMIUM TAX RATE, THE PREMIUM TAX RATE WILL CHANGE TO EQUAL THAT NEW
RATE.
- ------------------------------------------------------------------------------
MAXIMUM DEDUCTIONS FROM ACCOUNT VALUE
- ------------------------------------------------------------------------------
TYPE OF POLICY CHARGE OR
CHARGE YEARS PERCENT OF VALUE
------ ------ -----------------
MONTHLY ADMINISTRATIVE 1-5 $30.00 PER MONTH
CHARGE 6 + $10.00 PER MONTH
MORTALITY AND EXPENSE
RISK RATES
ACCUMULATED VALUE 1-10 0.0625% PER MONTH (0.75% PER
MORTALITY AND EXPENSE YEAR) OF THE ACUMULATED VALUE RISK
RATE IN THE SUB-ACCOUNTS.
11+ 0.05% PER MONTH (0.60% PER YEAR)
OF THE ACCUMULATED VALUES IN
THE SUB-ACCOUNTS.
FACE AMOUNT MORTALITY 1-10 0.192 PER MONTH PER $1,000 OF
AND EXPENSE RISK RATE PER INITIAL FACE AMOUNT.
$1,000
11+ 0
FACE AMOUNT INCREASE 0.0833 PER MONTH PER $1,000
FEE OF UNSCHEDULED INCREASE IN
FACE AMOUNT.
THIS AMOUNT WILL NOT BE LESS
THAN $41.67 PER MONTH BUT WILL
NOT EXCEED $250 PER MONTH.
- ------------------------------------------------------------------------------
Page 3A
1151(3A) PRINTED IN U.S.A.
<PAGE>
POLICY NUMBER: VL0000001
POLICY SPECIFICATIONS
POLICY CHARGES
- ------------------------------------------------------------------------------
DEDUCTIONS FROM PREMIUM PAYMENTS
- ------------------------------------------------------------------------------
TYPE OF CHARGE PERCENT OF PREMIUMS PAID
------------- -------------------------
MAXIMUM SALES CHARGES:
---------------------
ALL POLICY YEARS 6.00%
PREMIUM TAX CHARGE:
---------------------
ALL POLICY YEARS [1.75%]*
* THE PREMIUM TAX PERCENTAGE RATE DEPENDS UPON THE RATE ASSESSED BY YOUR
STATE OR MUNICIPALITY OF RESIDENCE. IF YOUR STATE OR MUNICIPALITY OF
RESIDENCE CHANGES AND/OR IF YOUR RESIDENCE STATE OR MUNICIPALITY CHANGES
ITS PREMIUM TAX RATE, THE PREMIUM TAX RATE WILL CHANGE TO EQUAL THAT NEW
RATE.
- ------------------------------------------------------------------------------
MAXIMUM DEDUCTIONS FROM ACCOUNT VALUE
- ------------------------------------------------------------------------------
TYPE OF POLICY CHARGE OR
CHARGE YEARS PERCENT OF VALUE
------- ------ ----------------
MONTHLY ADMINISTRATIVE 1-5 $30.00 PER MONTH
CHARGE 6 + $10.00 PER MONTH
MORTALITY AND EXPENSE
RISK RATES
ACCUMULATED VALUE 1-10 0.0625% PER MONTH (0.75% PER
MORTALITY AND EXPENSE YEAR) OF THE ACUMULATED VALUE
RISK RATE IN THE SUB-ACCOUNTS.
11+ 0.05% PER MONTH (0.60% PER YEAR)
OF THE ACCUMULATED VALUES IN
THE SUB-ACCOUNTS.
FACE AMOUNT MORTALITY 1-10 0.195 PER MONTH PER $1,000 OF
AND EXPENSE RISK RATE PER INITIAL FACE AMOUNT.
$1,000
11+ 0
FACE AMOUNT INCREASE 0.0833 PER MONTH PER $1,000
FEE OF UNSCHEDULED INCREASE IN
FACE AMOUNT.
THIS AMOUNT WILL NOT BE LESS
THAN $41.67 PER MONTH BUT WILL
NOT EXCEED $250 PER MONTH.
- ------------------------------------------------------------------------------
Page 3A
1151(3A)U PRINTED IN U.S.A.
<PAGE>
POLICY NUMBER: VL0000001
POLICY SPECIFICATIONS
POLICY CHARGES
- ------------------------------------------------------------------------------
TRANSFER CHARGE
- ------------------------------------------------------------------------------
ALL POLICY YEARS $00.00 FOR THE FIRST TRANSFER IN ANY CALENDAR
MONTH.
ALL POLICY YEARS $25.00 PER TRANSFER IN EXCESS OF 1 PER
CALENDAR MONTH.
- ------------------------------------------------------------------------------
SURRENDER CHARGES
- ------------------------------------------------------------------------------
POLICY SURRENDER POLICY SURRENDER
YEAR CHARGE YEAR CHARGE
1 $5,884.68 6 $3,362.67
2 5,884.68 7 2,522.00
3 5,884.68 8 1,681.34
4 5,044.01 9 840.67
5 4,203.34 10+ 0.00
SURRENDER CHARGES WILL BE REDUCED AS THE RESULT OF ANY PRIOR SURRENDER CHARGES
ASSESSED.
- ------------------------------------------------------------------------------
Page 3B
1151(3B) PRINTED IN U.S.A.
<PAGE>
POLICY NUMBER: VL0000001
POLICY SPECIFICATIONS
POLICY CHARGES
- ------------------------------------------------------------------------------
TRANSFER CHARGE
- ------------------------------------------------------------------------------
ALL POLICY YEARS $00.00 FOR THE FIRST TRANSFER IN ANY
CALENDAR MONTH.
ALL POLICY YEARS $25.00 PER TRANSFER IN EXCESS OF 1 PER
CALENDAR MONTH.
- ------------------------------------------------------------------------------
SURRENDER CHARGES
- ------------------------------------------------------------------------------
POLICY SURRENDER POLICY SURRENDER
YEAR CHARGE YEAR CHARGE
1 $6,164.05 6 $3,522.32
2 6,164.05 7 2,641.74
3 6,164.05 8 1761.16
4 5,283.47 9 880.58
5 4,402.90 10+ 0.00
SURRENDER CHARGES WILL BE REDUCED AS THE RESULT OF ANY PRIOR SURRENDER CHARGES
ASSESSED.
- ------------------------------------------------------------------------------
Page 3B
1151(3B)U PRINTED IN U.S.A.
<PAGE>
POLICY NUMBER: VL0000001
POLICY SPECIFICATIONS
- ------------------------------------------------------------------------------
SCHEDULED FACE AMOUNT INCREASES
- ------------------------------------------------------------------------------
DATE OF INCREASE SCHEDULED INCREASE AMOUNT
---------------- -------------------------
JANUARY 1, 2000 $75,000
JANUARY 1, 2001 $75,000
JANUARY 1, 2002 $75,000
JANUARY 1, 2003 $75,000
- ------------------------------------------------------------------------------
Page 3C
1151(3C) PRINTED IN U.S.A.
<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
POLICY DEATH BENEFIT OF INSURANCE POLICY DEATH BENEFIT OF INSURANCE
YEAR PERCENTAGES RATE YEAR PERCENTAGES RATE
- ------------------------------------------------------------------------------
1 250.00 0.0003 34 117.00 0.7182
2 250.00 0.0007 35 116.00 0.8414
3 250.00 0.0013 36 115.00 0.9879
4 250.00 0.0020 37 113.00 1.1653
5 250.00 0.0028 38 111.00 1.3822
6 250.00 0.0038 39 109.00 1.6447
7 243.00 0.0051 40 107.00 1.9553
8 236.00 0.0066 41 105.00 2.3140
9 229.00 0.0083 42 105.00 2.7198
10 222.00 0.0103 43 105.00 3.1724
11 215.00 0.0127 44 105.00 3.6760
12 209.00 0.0155 45 105.00 4.2428
13 203.00 0.0188 46 105.00 4.8903
14 197.00 0.0226 47 105.00 5.6355
15 191.00 0.0271 48 105.00 6.4950
16 185.00 0.0324 49 105.00 7.4696
17 178.00 0.0388 50 105.00 8.5493
18 171.00 0.0466 51 105.00 9.7187
19 164.00 0.0559 52 105.00 10.9650
20 157.00 0.0669 53 105.00 12.2768
21 150.00 0.0799 54 105.00 13.6477
22 146.00 0.0949 55 105.00 15.0844
23 142.00 0.1120 56 105.00 16.5963
24 138.00 0.1316 57 104.00 18.2119
25 134.00 0.1548 58 103.00 19.9859
26 130.00 0.1823 59 102.00 22.0472
27 128.00 0.2156 60 101.00 24.6880
28 126.00 0.2565 61 100.00 28.4789
29 124.00 0.3068 62 100.00 34.5196
30 122.00 0.3671 63 100.00 44.7758
31 120.00 0.4378 64 100.00 61.9954
32 119.00 0.5194 65 100.00 83.3333
33 118.00 0.6123
THE MINIMUM DEATH BENEFIT PERCENTAGES ARE DETERMINED TO COMPLY WITH SECTION
7702 OF THE INTERNAL REVENUE CODE. THE MAXIMUM COST OF INSURANCE RATES DO
NOT EXCEED THE COST OF INSURANCE RATES BASED ON THE 1980 COMMISSIONERS
STANDARD ORDINARY MALE OR FEMALE, SMOKER OR NONSMOKER MORTALITY TABLE, AGE
LAST BIRTHDAY. THE MAXIMUM COST OF INSURANCE RATES HAVE BEEN ADJUSTED TO
REFLECT ANY SPECIAL CLASS RATING.
Page 3D
1151(3D) PRINTED IN U.S.A.
<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
POLICY DEATH BENEFIT OF INSURANCE POLICY DEATH BENEFIT OF INSURANCE
YEAR PERCENTAGES RATE YEAR PERCENTAGES RATE
- ------------------------------------------------------------------------------
1 250.00 0.0003 34 117.00 0.9092
2 250.00 0.0008 35 116.00 1.0708
3 250.00 0.0014 36 115.00 1.2703
4 250.00 0.0022 37 113.00 1.4988
5 250.00 0.0030 38 111.00 1.7626
6 250.00 0.0041 39 109.00 2.0864
7 243.00 0.0054 40 107.00 2.4621
8 236.00 0.0069 41 105.00 2.8870
9 229.00 0.0088 42 105.00 3.3610
10 222.00 0.0109 43 105.00 3.8795
11 215.00 0.0135 44 105.00 4.4466
12 209.00 0.0165 45 105.00 5.0747
13 203.00 0.0202 46 105.00 5.7796
14 197.00 0.0244 47 105.00 6.5778
15 191.00 0.0293 48 105.00 7.4853
16 185.00 0.0353 49 105.00 8.5026
17 178.00 0.0426 50 105.00 9.6154
18 171.00 0.0514 51 105.00 10.8026
19 164.00 0.0622 52 105.00 12.0488
20 157.00 0.0750 53 105.00 13.3413
21 150.00 0.0904 54 105.00 14.6689
22 146.00 0.1086 55 105.00 16.0414
23 142.00 0.1301 56 105.00 17.4720
24 138.00 0.1550 57 104.00 18.9860
25 134.00 0.1849 58 103.00 20.6346
26 130.00 0.2208 59 102.00 22.5656
27 128.00 0.2638 60 101.00 25.0891
28 126.00 0.3162 61 100.00 28.7688
29 124.00 0.3801 62 100.00 34.6975
30 122.00 0.4566 63 100.00 44.8669
31 120.00 0.5462 64 100.00 62.0401
32 119.00 0.6507 65 100.00 83.3333
33 118.00 0.7709
THE MINIMUM DEATH BENEFIT PERCENTAGES ARE DETERMINED TO COMPLY WITH SECTION
7702 OF THE INTERNAL REVENUE CODE. 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 BLENDED TABLE B, AGE LAST
BIRTHDAY. THE MAXIMUM COST OF INSURANCE RATES HAVE BEEN ADJUSTED TO REFLECT
ANY SPECIAL CLASS RATING.
Page 3D
1151(3D)U PRINTED IN U.S.A.
<PAGE>
POLICY NUMBER: VL0000001
POLICY SPECIFICATIONS
- ------------------------------------------------------------------------------
SINGLE LIFE YEARLY RENEWABLE TERM LIFE RIDER SPECIFICATIONS
- ------------------------------------------------------------------------------
DESIGNATED INSURED: JOHN DOE
TABLE OF SINGLE LIFE YEARLY RENEWABLE TERM LIFE RIDER
MONTHLY MAXIMUM RATES (PER $1,000 OF RIDER BENEFIT)
POLICY MAXIMUM POLICY MAXIMUM
YEAR RATE YEAR RATE
1 0.1442 34 2.4933
2 0.1517 35 2.7483
3 0.1617 36 3.0367
4 0.1725 37 3.3658
5 0.1842 38 3.7458
6 0.1983 39 4.1758
7 0.2133 40 4.6483
8 0.2292 41 5.1533
9 0.2467 42 5.6867
10 0.2658 43 6.2442
11 0.2875 44 6.8292
12 0.3108 45 7.4600
13 0.3358 46 8.1567
14 0.3633 47 8.9375
15 0.3933 48 9.8183
16 0.4275 49 10.7950
17 0.4667 50 11.8483
18 0.5117 51 12.9542
19 0.5633 52 14.0983
20 0.6208 53 15.2633
21 0.6850 54 16.4442
22 0.7550 55 17.6575
23 0.8292 56 18.9208
24 0.9117 57 20.2633
25 1.0042 58 21.7350
26 1.1075 59 23.4792
27 1.2225 60 25.8192
28 1.3550 61 29.3217
29 1.5050 62 35.0825
30 1.6717 63 45.0833
31 1.8542 64 62.0958
32 2.0517 65 83.3333
33 2.2633
THE MAXIMUM RATES DO NOT EXCEED THE COST OF INSURANCE RATES BASED ON THE 1980
COMMISSIONERS STANDARD ORDINARY MALE/FEMALE SMOKER OR NONSMOKER MORTALITY
TABLE, AGE LAST BIRTHDAY WITH TEN YEAR SELECT FACTORS. THE MAXIMUM COST OF
INSURANCE RATES HAVE BEEN ADJUSTED TO REFLECT ANY SPECIAL CLASS RATING.
Page 4
1151(4) PRINTED IN U.S.A.
<PAGE>
POLICY NUMBER: VL0000001
POLICY SPECIFICATIONS
- ------------------------------------------------------------------------------
SINGLE LIFE YEARLY RENEWABLE TERM LIFE RIDER SPECIFICATIONS
- ------------------------------------------------------------------------------
DESIGNATED INSURED: MARY DOE
TABLE OF SINGLE LIFE YEARLY RENEWABLE TERM LIFE RIDER
MONTHLY MAXIMUM RATES (PER $1,000 OF RIDER BENEFIT)
POLICY MAXIMUM POLICY MAXIMUM
YEAR RATE YEAR RATE
1 0.1258 34 1.5525
2 0.1342 35 1.6917
3 0.1442 36 1.8550
4 0.1550 37 2.0542
5 0.1667 38 2.2983
6 0.1808 39 2.5908
7 0.1958 40 2.9275
8 0.2108 41 3.3033
9 0.2258 42 3.7100
10 0.2408 43 4.1458
11 0.2575 44 4.6175
12 0.2750 45 5.1400
13 0.2942 46 5.7342
14 0.3142 47 6.4175
15 0.3367 48 7.2050
16 0.3617 49 8.0933
17 0.3892 50 9.0725
18 0.4208 51 10.1317
19 0.4558 52 11.2633
20 0.4917 53 12.4658
21 0.5300 54 13.7400
22 0.5683 55 15.0958
23 0.6058 56 16.5442
24 0.6433 57 18.1183
25 0.6858 58 19.8775
26 0.7358 59 21.9458
27 0.7975 60 24.6025
28 0.8742 61 28.4183
29 0.9683 62 34.4900
30 1.0742 63 44.7700
31 1.1883 64 61.9967
32 1.3067 65 83.3333
33 1.4275
THE MAXIMUM RATES DO NOT EXCEED THE COST OF INSURANCE RATES BASED ON THE 1980
COMMISSIONERS STANDARD ORDINARY MALE/FEMALE SMOKER OR NONSMOKER MORTALITY
TABLE, AGE LAST BIRTHDAY WITH TEN YEAR SELECT FACTORS. THE MAXIMUM COST OF
INSURANCE RATES HAVE BEEN ADJUSTED TO REFLECT ANY SPECIAL CLASS RATING.
Page 4 (Continued)
1151(4 CONT'D) PRINTED IN U.S.A.
<PAGE>
POLICY NUMBER: VL0000001
POLICY SPECIFICATIONS
- ------------------------------------------------------------------------------
SINGLE LIFE YEARLY RENEWABLE TERM LIFE RIDER SPECIFICATIONS
- ------------------------------------------------------------------------------
DESIGNATED INSURED: JOHN DOE
TABLE OF SINGLE LIFE YEARLY RENEWABLE TERM LIFE RIDER
MONTHLY MAXIMUM RATES (PER $1,000 OF RIDER BENEFIT)
POLICY MAXIMUM POLICY MAXIMUM
YEAR RATE YEAR RATE
1 0.1400 34 2.2925
2 0.1483 35 2.5217
3 0.1575 36 2.7992
4 0.1692 37 3.0975
5 0.1808 38 3.4242
6 0.1950 39 3.8183
7 0.2092 40 4.2542
8 0.2250 41 4.7217
9 0.2425 42 5.2183
10 0.2608 43 5.7367
11 0.2817 44 6.2833
12 0.3033 45 6.8758
13 0.3275 46 7.5333
14 0.3542 47 8.2733
15 0.3817 48 9.1117
16 0.4142 49 10.0458
17 0.4508 50 11.0583
18 0.4933 51 12.1283
19 0.5417 52 13.2442
20 0.5950 53 14.3983
21 0.6533 54 15.5850
22 0.7167 55 16.8200
23 0.7850 56 18.1208
24 0.8575 57 19.5158
25 0.9392 58 21.0583
26 1.0317 59 22.8975
27 1.1358 60 25.3433
28 1.2558 61 28.9575
29 1.3942 62 34.8292
30 1.5483 63 44.9450
31 1.7150 64 62.0675
32 1.8950 65 83.3333
33 2.0867
THE MAXIMUM RATES DO NOT EXCEED THE COST OF INSURANCE RATES BASED ON THE 1980
COMMISSIONERS STANDARD ORDINARY SMOKER OR NONSMOKER MORTALITY BLENDED TABLE B,
AGE LAST BIRTHDAY WITH TEN YEAR SELECT FACTORS. THE MAXIMUM COST OF INSURANCE
RATES HAVE BEEN ADJUSTED TO REFLECT ANY SPECIAL CLASS RATING.
Page 4
1151(4U) PRINTED IN U.S.A.
<PAGE>
POLICY NUMBER: VL0000001
POLICY SPECIFICATIONS
SINGLE LIFE YEARLY RENEWABLE TERM LIFE RIDER SPECIFICATIONS
DESIGNATED INSURED: MARY DOE
TABLE OF SINGLE LIFE YEARLY RENEWABLE TERM LIFE RIDER
MONTHLY MAXIMUM RATES (PER $1,000 OF RIDER BENEFIT)
POLICY MAXIMUM POLICY MAXIMUM
YEAR RATE YEAR RATE
1 0.1400 34 2.2925
2 0.1483 35 2.5217
3 0.1575 36 2.7992
4 0.1692 37 3.0975
5 0.1808 38 3.4242
6 0.1950 39 3.8183
7 0.2092 40 4.2542
8 0.2250 41 4.7217
9 0.2425 42 5.2183
10 0.2608 43 5.7367
11 0.2817 44 6.2833
12 0.3033 45 6.8758
13 0.3275 46 7.5333
14 0.3542 47 8.2733
15 0.3817 48 9.1117
16 0.4142 49 10.0458
17 0.4508 50 11.0583
18 0.4933 51 12.1283
19 0.5417 52 13.2442
20 0.5950 53 14.3983
21 0.6533 54 15.5850
22 0.7167 55 16.8200
23 0.7850 56 18.1208
24 0.8575 57 19.5158
25 0.9392 58 21.0583
26 1.0317 59 22.8975
27 1.1358 60 25.3433
28 1.2558 61 28.9575
29 1.3942 62 34.8292
30 1.5483 63 44.9450
31 1.7150 64 62.0675
32 1.8950 65 83.3333
33 2.0867
THE MAXIMUM RATES DO NOT EXCEED THE COST OF INSURANCE RATES BASED ON THE 1980
COMMISSIONERS STANDARD ORDINARY SMOKER OR NONSMOKER MORTALITY BLENDED TABLE
B, AGE LAST BIRTHDAY WITH TEN YEAR SELECT FACTORS. THE MAXIMUM COST OF
INSURANCE RATES HAVE BEEN ADJUSTED TO REFLECT ANY SPECIAL CLASS RATING.
Page 4 (Continued)
1151(4U CONT'D) PRINTED IN U.S.A.
<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.
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. On the Policy Date, the
Cumulative Death Benefit Guarantee Premium is the Monthly Death
Benefit Guarantee Premium shown on Page 3. On each Monthly
Activity Date thereafter, the Cumulative Death Benefit Premium
is: (a) the Cumulative Death Benefit Guarantee Premium on the
previous Monthly Activity Date; plus (b) the current Monthly
Death Benefit Guarantee Premium.
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 and the Death Benefit Guarantee provision.
DEATH BENEFIT GUARANTEE AMOUNT: a benefit amount selected by You
at the time You apply for this policy. This is the Death Benefit
that will apply to Your Policy while the Death Benefit Guarantee
is in effect.
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
Last Surviving Insured.
DOLLAR COST AVERAGING: systematic transfers from one account to
any other available accounts.
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, the Death Benefit Option Changes provision, the Death
Benefit Guarantee 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 companies in which
assets of the Separate Account may be invested.
Page 5
1151(5/6) PRINTED IN U.S.A.
<PAGE>
DEFINITIONS GENERAL ACCOUNT: all Company assets other than those allocated
(CONTINUED) to the separate accounts.
INDEBTEDNESS: all loans taken on the Policy, plus any interest
due or accrued minus any loan repayments.
IN WRITING: in a written form satisfactory to Us.
ISSUE AGE: as of the Policy Date, an Insured's age on his/her
last birthday.
LAST SURVIVING INSURED: the Insured who survives after the death
of one of the Insureds shown on Page 3. If both Insureds die
simultaneously, the Last Surviving Insured will be the First
Insured shown on Page 3.
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
Initial Planned Premium is shown on Page 3.
POLICY ANNIVERSARY: an anniversary of the Policy Date.
POLICY DATE: the date shown on Page 3 from which Policy
Anniversaries and Policy Years are determined. This is the date
the Policy goes into effect.
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, in accordance with the Termination and
Maturity Date provision.
SEPARATE ACCOUNT: an account, as specified on Page 3, 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.
SUB-ACCOUNTS: the subdivisions of the Separate Account.
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
1151(5/6) PRINTED IN U.S.A.
<PAGE>
DEATH BENEFIT GENERAL
Upon receipt of due proof of the Last Surviving 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 Last Surviving 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.
NOTIFICATION OF FIRST DEATH OF THE INSUREDS
You must notify Us In Writing and give Us due proof of the first
death of the Insureds as soon as possible after the death.
DEATH BENEFIT OPTIONS
You have three Death Benefit Options.
1. Under Option A (Level Option), the Death Benefit is the
current Face Amount.
2. Under Option B (Return of Account Value Option), the Death
Benefit is the current Face Amount, plus the Account Value
on the date We receive due proof of the Last Surviving
Insured's death.
3. Under Option C (Return of Premium Option), the Death Benefit
is the lesser of: (a) the current Face Amount, plus the sum
of the premiums paid; or (b) the Death Benefit 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) 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 3D.
This is to qualify the Policy as life insurance under the
Internal Revenue Code.
Page 7
1151(7/8) PRINTED IN U.S.A.
<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.
SCHEDULED INCREASES IN FACE AMOUNT
We will increase the Face Amount automatically by the amounts
shown on Page 3C. These scheduled increases will continue until
You request to discontinue the increases or until You request to
decrease the Face Amount of Your Policy. Decreases in the Face
Amount as a result of a withdrawal will not affect Your scheduled
increases.
Scheduled increases in the Face Amount are not subject to the
Face Amount Increase Fee.
UNSCHEDULED 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 Monthly Activity
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. The Face Amount Increase
Fee as shown on Page 3A is assessed on the first twelve Monthly
Activity Dates beginning on the effective date of each increase.
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 during the Surrender Charge Period, You
decrease Your Face Amount to an amount lower than it has ever
been, a partial Surrender Charge will 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 new Face Amount from the lowest previous
Face Amount; and
(ii) dividing that difference by the lowest previous Face Amount.
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
Surrender Charges.
Page 8
1151(7/8) PRINTED IN U.S.A.
<PAGE>
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.
PLANNED PREMIUM PAYMENTS
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 Initial Planned Premium payment and payment frequency You
selected are shown on Page 3. You may change the Planned Premium
payment shown on the premium notices subject to Our premium
limitations.
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 Our Premium Limitations.
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 or the amount
required to keep the Policy in force.
(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 and any additional Net Premiums received
by Us prior to the end of the Right to Examine Policy Period will
be allocated as shown on Page 3 on the later of:
(a) the Policy Date; and
(b) the date We receive the premium.
The accumulated values of these amounts will then be allocated to
the Fixed Account and Sub-Accounts according to the premium
allocation You specified in the application on the later of:
(a) at the end of the Right to Examine Policy Period; or
(b) the date We receive the final requirement to put the Policy
in force.
Page 9
1151(9/10) PRINTED IN U.S.A.
<PAGE>
PREMIUMS SUBSEQUENT PREMIUM ALLOCATIONS
(CONTINUED) 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 as long as:
(a) the number of Sub-Accounts You choose does not exceed 9; and
(b) the percentage You allocate to each Sub-Account is in whole
percentages.
If We receive a premium with a premium allocation instruction
that does not comply with the above rules, We will allocate the
Net Premium on a Pro Rata Basis.
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.
SUB-ACCOUNT ACCUMULATION UNITS
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 Annual Fixed Account
Minimum Credited Rate is shown on Page 3. The interest credited
will reflect the timing of amounts added to or withdrawn from the
Fixed Account.
Page 10
1151(9/10) PRINTED IN U.S.A.
<PAGE>
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
SURRENDER policy 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.
ACCUMULATED VALUE - FIXED ACCOUNT
Your Accumulated Value in the Fixed Account equals:
(a) the Net Premiums allocated to it; plus
(b) amounts transferred to it from the Sub-Accounts or the Loan
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 Surrender Charges and the Policy Years
during which they will be applied are shown on Page 3B.
CASH SURRENDER VALUE
Your Cash Surrender Value is equal to Your Cash Value minus the
Indebtedness, if any.
Page 11
1151(11/12) PRINTED IN U.S.A.
<PAGE>
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.
DOLLAR COST AVERAGING
From time to time, We may offer and You may enroll in a Dollar
Cost Averaging program. Prior to enrollment, You may obtain
information on the available programs from Us.
You may terminate participation in the program at any time by
calling or writing Us. In such an event, any non-transferred
balances will be allocated to the other accounts according to
Your instructions.
RESTRICTIONS ON NON- DOLLAR COST AVERAGING TRANSFERS
Transfers from the Fixed Account (other than a Dollar Cost
Averaging transfer) 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 3B, if any, will be deducted on a Pro Rata Basis.
MONTHLY GENERAL
DEDUCTION On each Monthly Activity Date, We will deduct an amount from Your
AMOUNT 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 Face Amount Increase Fee, if any; plus
(e) 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.
Page 12
1151(11/12) PRINTED IN U.S.A.
<PAGE>
MONTHLY COST OF INSURANCE RATE
DEDUCTION The Cost of Insurance Rate is based on the then current
AMOUNT Policy Year as well as the sexes, Issue Ages and insurance
(CONTINUED) classes of the Insureds shown on Page 3.
The Cost of Insurance Rates will not exceed those in the
Table of Monthly Maximum Cost of Insurance Rates shown on
Page 3D.
We can use Cost of Insurance Rates that are lower than the
Monthly Maximum Cost of Insurance Rates shown on Page 3D.
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 Ages, sexes and insurance classes and whose coverage
has been in force for the same length of time. Based on Our
administrative rules in effect and upon providing
satisfactory evidence to Us, You may change the insurance
classes to a more favorable class. Future Cost of Insurance
charges will be based on the more favorable class and all
other contract terms and provisions will remain as
established at issue. No change in insurance class or cost
will occur on account of deterioration of either 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 the sum of (a) and (b) where
(a) equals:
(i) the monthly Accumulated Value Mortality and
Expense Risk Rate; multiplied by
(ii) the sum of Your Accumulated Values in the Sub-
Accounts on the Monthly Activity Date, prior to
assessing the Monthly Deduction Amount.
and
(b) equals:
(i) the monthly Mortality and Expense Risk Rate per
$1,000; multiplied by
(ii) the Initial Face Amount; divided by
(iii) $1,000.
Each month the Mortality and Expense Risk Rates will not
exceed those shown on Page 3A.
FACE AMOUNT INCREASE FEE
The Face Amount Increase Fee will not exceed the amount
shown on Page 3A.
LAPSE AND POLICY POLICY GRACE PERIOD
GRACE PERIOD During the first Policy Year, the Policy will go into
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 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.
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.
Page 13
1151(13/14) PRINTED IN U.S.A.
<PAGE>
LAPSE AND POLICY If the Policy goes into default, We will send You a lapse
GRACE PERIOD notice warning You that the Policy is in danger of
(CONTINUED) terminating. That lapse notice will tell You the minimum
premium required to keep the Policy from terminating.
This minimum premium equals the amount 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 lapse
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 Last Surviving 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
available, as described below.
The Death Benefit Guarantee is available as long as:
(a) the Policy is in the Death Benefit Guarantee Period;
and
(b) on each Monthly Activity Date during that period, the
cumulative premiums paid into the Policy, less
Indebtedness and less withdrawals from the Policy,
equal or exceed the Cumulative Death Benefit Guarantee
Premium.
The Death Benefit Guarantee Period is shown on Page 3.
If the Death Benefit Guarantee is available and You fail to
pay the required premium as defined in Your lapse notice by
the end of the Policy Grace Period, the Death Benefit
Guarantee will then go into effect. The Policy will remain
in force, however:
(a) all riders will terminate;
(b) the Death Benefit Option becomes Level;
(c) the Face Amount will be reduced to the Death Benefit
Guarantee Amount; and
(d) any future scheduled Increases in the Face Amount
will be canceled.
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.
If during the Death Benefit Guarantee Period, the Face
Amount is decreased below the current Death Benefit
Guarantee Amount, the Death Benefit Guarantee Amount will
become the new Face Amount. A new monthly Death Benefit
Guarantee Premium will be calculated. We will send You a
notice of the new Monthly Death Benefit Guarantee Premium,
which will be used in calculating the Cumulative Death
Benefit Guarantee Premium in subsequent months.
Page 14
1151(13/14) PRINTED IN U.S.A.
<PAGE>
MONTHLY COST OF INSURANCE RATE
DEDUCTION The Cost of Insurance Rate is based on the then current
AMOUNT Policy Year as well as the Issue Ages and insurance classes
(CONTINUED) of the Insureds shown on Page 3.
The Cost of Insurance Rates will not exceed those in the
Table of Monthly Maximum Cost of Insurance Rates shown on
Page 3D.
We can use Cost of Insurance Rates that are lower than the
Monthly Maximum Cost of Insurance Rates shown on Page 3D.
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 Ages and insurance classes and whose coverage has been
in force for the same length of time. Based on Our
administrative rules in effect and upon providing
satisfactory evidence to Us, You may change the insurance
classes to a more favorable class. Future Cost of Insurance
charges will be based on the more favorable class and all
other contract terms and provisions will remain as
established at issue. No change in insurance class or cost
will occur on account of deterioration of either 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 the sum of (a) and (b) where
(a) equals:
(i) the monthly Accumulated Value Mortality and Expense
Risk Rate; multiplied by
(ii) the sum of Your Accumulated Values in the Sub-
Accounts on the Monthly Activity Date, prior
to assessing the Monthly Deduction Amount.
and
(b) equals:
(i) the monthly Mortality and Expense Risk Rate per
$1,000; multiplied by
(ii) the Initial Face Amount; divided by
(iii) $1,000.
Each month the Mortality and Expense Risk Rates will not
exceed those shown on Page 3A.
FACE AMOUNT INCREASE FEE
The Face Amount Increase Fee will not exceed the amount
shown on Page 3A.
<PAGE>
LAPSE AND POLICY POLICY GRACE PERIOD
GRACE PERIOD During the first Policy Year, the Policy will go into
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 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.
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.
Page 13
1151(13/14)U PRINTED IN U.S.A.
<PAGE>
LAPSE AND POLICY If the Policy goes into default, We will send You a lapse
GRACE PERIOD notice warning You that the
(CONTINUED) Policy is in danger of terminating. That lapse notice will
tell You the minimum premium
required to keep the Policy from terminating. This minimum
premium equals the amount 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 lapse
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 Last Surviving 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
available, as described below.
The Death Benefit Guarantee is available as long as:
(a) the Policy is in the Death Benefit Guarantee Period;
and
(b) on each Monthly Activity Date during that period, the
cumulative premiums paid into the Policy, less
Indebtedness and less withdrawals from the Policy,
equal or exceed the Cumulative Death Benefit Guarantee
Premium.
The Death Benefit Guarantee Period is shown on Page 3.
If the Death Benefit Guarantee is available and You fail to
pay the required premium as defined in Your lapse notice by
the end of the Policy Grace Period, the Death Benefit
Guarantee will then go into effect. The Policy will remain
in force, however:
(a) all riders will terminate;
(b) the Death Benefit Option becomes Level;
(c) the Face Amount will be reduced to the Death Benefit
Guarantee Amount; and
(d) any future scheduled Increases in the Face Amount will
be canceled.
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.
If during the Death Benefit Guarantee Period, the Face
Amount is decreased below the current Death Benefit
Guarantee Amount, the Death Benefit Guarantee Amount will
become the new Face Amount. A new monthly Death Benefit
Guarantee Premium will be calculated. We will send You a
notice of the new Monthly Death Benefit Guarantee Premium,
which will be used in calculating the Cumulative Death
Benefit Guarantee Premium in subsequent months.
Page 14
1151(13/14)U PRINTED IN U.S.A.
<PAGE>
LAPSE AND POLICY DEATH BENEFIT GUARANTEE GRACE PERIOD
GRACE PERIOD If, on each Monthly Activity Date during the Death Benefit
(CONTINUED) Guarantee Period, the cumulative premiums paid into the
Policy, less Indebtedness and 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 a notice. That notice will
warn You that You are in danger of losing the Death Benefit
Guarantee and will tell You the amount of premium You need
to pay 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) the Insureds alive at the end of the Policy Grace
Period are also alive on the date of reinstatement;
(b) You make Your request In Writing within five years from
the Termination Date;
(c) satisfactory evidence of insurability is submitted;
(d) any Indebtedness at the time of termination must be
repaid or carried over to the reinstated policy; and
(e) 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 as though the Policy had never lapsed.
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.
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.
Page 15
1151(15/16) PRINTED IN U.S.A.
<PAGE>
POLICY LOANS CREDITED INTEREST
(CONTINUED) Any amounts in the Loan Account will be credited with
interest at a rate equal to the Annual Fixed Account Minimum
Credited Rate shown on Page 3.
PREFERRED INDEBTEDNESS
If, any time after the 10th Policy Anniversary, the Account
Value exceeds the total of all premiums paid since issue, a
portion of Your Indebtedness may qualify as preferred.
Preferred Indebtedness is charged a lower interest rate than
the non-preferred Indebtedness, if any. (Refer to the
Interest Charged on Indebtedness provision for details.)
The maximum amount of Preferred Indebtedness is the amount
by which the Account Value exceeds the total premiums paid
and 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) either of the Insureds is alive.
However, each repayment must be at least the lesser of $50
or the Indebtedness 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.
<TABLE>
<CAPTION>
INTEREST RATE CHARGED
EQUALS THE FIXED
DURING POLICY PORTION OF ACCOUNT MINIMUM
YEARS INDEBTEDNESS CREDITED RATE PLUS:
-------------- ------------ ----------------------
<S> <C> <C>
1-10 All 2%
11 and later Preferred 0%
Non-Preferred 1%
</TABLE>
Because the interest charged on Indebtedness may exceed the
rate 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.
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
lowest previous Face Amount will be subject to a partial
Surrender Charge. Refer to the Decreases in Face Amount
provision for an explanation of the applicable partial
Surrender Charge.
Page 16
1151(15/16) PRINTED IN U.S.A.
<PAGE>
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 canceled 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 Annual 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.
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 jurisdiction),
be deemed representations and not warranties.
INTERPRETATION OF POLICY TERMS AND CONDITIONS
We have full discretion and authority to determine
eligibility for benefits and to construe and interpret all
terms and provisions of the Policy.
CONTRACT 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.
FUND MODIFICATION
We reserve the right, subject to any applicable law, to make
certain changes, including the right to add, eliminate or
substitute any investment options offered under the Policy.
NON-PARTICIPATION
The Policy is non-participating. It does not share in Our
surplus earnings, so You will receive no policy dividends
under it.
Page 17
1151(17/18) PRINTED IN U.S.A.
<PAGE>
THE CONTRACT MISSTATEMENT OF AGE AND/OR SEX
(CONTINUED) If on the date of death of the Last Surviving Insured:
(a) the Issue Age of an Insured is understated; or
(b) the sex of an 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 Ages and/or sexes.
If on the date of death of the Last Surviving Insured:
(a) the Issue Age of an Insured is overstated; or
(b) the sex of an 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 Last
Surviving Insured's death.
SUICIDE
If, within 2 years from the Date of Issue, either of the
Insureds 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, either of the Insureds 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
With regard to the life of each Insured, 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
non-payment of premium.
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.
The Policy may not be contested for more than 2 years after
the reinstatement date. Any contest We make after the
Policy is reinstated will be limited to the material
misrepresentations in the evidence of insurability provided
to Us in the request for reinstatement. However, the
provision will not affect Our right to contest any statement
in the original application or a different reinstatement
request which was made during the Insured's lifetime from
the Date of Issue of the Policy or a subsequent
reinstatement date.
APPEALING DENIAL OF CLAIM
On any denied claim, You or Your representative may appeal
to the Company for a full and fair review. You may:
(a) request a review upon written application within 60
days of receipt of a claim denial;
(b) review pertinent documents; and
(c) submit issues and comments In Writing.
SEPARATE ACCOUNTS
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.
Page 18
1151(17/18) PRINTED IN U.S.A.
<PAGE>
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 canceled 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 Annual 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.
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 jurisdiction),
be deemed representations and not warranties.
INTERPRETATION OF POLICY TERMS AND CONDITIONS
We have full discretion and authority to determine
eligibility for benefits and to construe and interpret all
terms and provisions of the Policy.
CONTRACT 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.
FUND MODIFICATION
We reserve the right, subject to any applicable law, to make
certain changes, including the right to add, eliminate or
substitute any investment options offered under the Policy.
NON-PARTICIPATION
The Policy is non-participating. It does not share in Our
surplus earnings, so You will receive no policy dividends
under it.
Page 17
1151(17/18)U PRINTED IN U.S.A.
<PAGE>
THE CONTRACT MISSTATEMENT OF AGE
(CONTINUED) If on the date of death of the Last Surviving Insured, the
Issue Age of an Insured is understated; 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 Ages.
If on the date of death of the Last Surviving Insured, the
Issue Age of an Insured is overstated, the Death Benefit
will be adjusted by the return of all excess Costs of
Insurance prior to the date of the Last Surviving Insured's
death.
SUICIDE
If, within 2 years from the Date of Issue, either of the
Insureds 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, either of the Insureds 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
With regard to the life of each Insured, 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
non-payment of premium.
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.
The Policy may not be contested for more than 2 years after
the reinstatement date. Any contest We make after the
Policy is reinstated will be limited to the material
misrepresentations in the evidence of insurability provided
to Us in the request for reinstatement. However, the
provision will not affect Our right to contest any statement
in the original application or a different reinstatement
request which was made during the Insured's lifetime from
the Date of Issue of the Policy or a subsequent
reinstatement date.
APPEALING DENIAL OF CLAIM
On any denied claim, You or Your representative may appeal
to the Company for a full and fair review. You may:
(a) request a review upon written application within 60
days of receipt of a claim denial;
(b) review pertinent documents; and
(c) submit issues and comments In Writing.
SEPARATE ACCOUNTS
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.
Page 18
1151(17/18)U PRINTED IN U.S.A.
<PAGE>
THE CONTRACT CHANGE IN THE OPERATION OF THE SEPARATE ACCOUNT
(CONTINUED) At Our election and subject to any necessary vote by persons
having the right to give instructions on the voting of Fund
shares held by the Sub-Accounts, the Separate Account may be
operated as a management company under the Investment
Company Act of 1940 or any form permitted by law, may be
deregistered under the Investment Company Act of 1940 in the
event registration is no longer required, or may be combined
with one or more Separate Accounts.
VOTING RIGHTS
We will notify You of any Fund shareholder's meetings at
which the shares held for Your Sub-Account may be voted. We
will also send proxy materials and instructions for You to
vote the shares held for Your Sub-Account. We will arrange
for the handling and tallying of proxies received from the
Owners. We will vote the Fund shares held by Us in
accordance with the instructions received from the Owners.
You may attend any meeting, where shares held for Your
benefit may be voted.
In the event that You give no instructions or leave the
manner of voting discretionary, We will vote such shares of
the appropriate Fund in the same proportion as shares of
that Fund for which instructions have been received. Also,
We will vote the Fund shares in this proportionate manner
which are held by Us for Our own account.
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 either of the
Insureds is alive. After We receive written notice, the
change will be effective as of the date You signed such
notice, whether or not either of the Insureds 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 either of the Insureds 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 Last Surviving Insured,
then, unless the Policy provides otherwise:
(a) You will be the Beneficiary; or
(b) if You are the Last Surviving Insured, Your estate will
be the Beneficiary.
Page 19
1151(19/20) PRINTED IN U.S.A.
<PAGE>
TERMINATION AND TERMINATION
MATURITY DATE The Policy will terminate upon the earliest of the following
events:
(a) Scheduled Maturity Date of the Policy unless You
request to continue the Policy after such date as
described below; or
(b) surrender of the Policy; or
(c) 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
available; or
(d) if the Death Benefit Guarantee is in available and in
effect, the end of the Death Benefit Guarantee Period;
or
(e) if the Death Benefit Guarantee is available and in
effect, the end of the Death Benefit Guarantee Grace
Period during which premiums sufficient to maintain the
Death Benefit Guarantee are not paid; or
(f) the date We receive notification In Writing of the
death of the Last Surviving Insured. In this event,
Your Death Benefit will not be affected by any Monthly
Deduction Amounts taken after the date of the Last
Surviving 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 You elect to continue the
Policy beyond this date, the Policy will terminate and any
Cash Surrender Value will be paid to You.
If elected, the Policy may continue in force after the
Scheduled Maturity Date subject to the following conditions:
(a) the Policy must be in force on the Scheduled Maturity
Date;
(b) the Owner including any assignee of record must agree
In Writing to this continuation.
If any of the above conditions are not met, the Policy, if
still in force, will terminate on the Scheduled Maturity
Date.
After the Scheduled Maturity Date:
(a) the Death Benefit will be reduced to the Account Value;
(b) the Account Value, if any will continue to be valued as
described in the Account Value, Cash Value and Cash
Surrender Value provision;
(c) any loans that are in effect on the Scheduled Maturity
Date will continue to accrue interest and become part
of any Indebtedness;
(d) No future Monthly Deduction Amounts will be deducted
from Your Account Value;
(e) No further premiums will be accepted.
All additional benefits provided by rider will deem to have
terminated at the Scheduled Maturity Date.
Page 20
1151(19/20) PRINTED IN U.S.A.
<PAGE>
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 Last Surviving 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.
OTHER OPTIONS
To convert the monthly payments shown in the tables for
Options 3 and 4 to quarterly, semi-annual or annual
payments, multiply 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.
Page 21
1151(21/22) PRINTED IN U.S.A.
<PAGE>
INCOME OPTION 3 - INCOME FOR FIXED PERIOD
SETTLEMENT Payments, determined from the table below, are guaranteed
OPTIONS for the number of years chosen. The first payment will be
(CONTINUED) due on the date proceeds are applied under this
option.
<TABLE>
<CAPTION>
MONTHLY PAYMENTS MONTHLY PAYMENTS
NUMBER PER $1,000 OF NUMBER PER $1,000 OF
OF YEARS PROCEEDS OF YEARS PROCEEDS
<S> <C> <C> <C>
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
</TABLE>
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.
MONTHLY PAYMENTS PER $1,000 OF PROCEEDS
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
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
Page 22
1151(21/22) PRINTED IN U.S.A.
<PAGE>
INCOME AVAILABILITY
SETTLEMENT All or parts of the proceeds of the Policy may, instead of being
OPTIONS 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 31/2% per year (or higher, if
required by state law) on the Death Proceeds from the date of the
Last Surviving 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 31/2% 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 31/2% per
year.
Any such amount will be paid in one sum to the payee's estate.
OTHER OPTIONS
To convert the monthly payments shown in the tables for Options 3
and 4 to quarterly, semi-annual or annual payments, multiply 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
31/2% 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 31/2% per year, is
exhausted. The final payment will be for the balance only.
Page 21
1151(21/22)U PRINTED IN U.S.A.
<PAGE>
INCOME OPTION 3 - INCOME FOR FIXED PERIOD
SETTLEMENT Payments, determined from the table below, are guaranteed for the
OPTIONS number of years chosen. The first payment will be due on the
(CONTINUED) date proceeds are applied under this option.
<TABLE>
<CAPTION>
MONTHLY PAYMENTS MONTHLY PAYMENTS
NUMBER PER $1,000 OF NUMBER PER $1,000 OF
OF YEARS PROCEEDS OF YEARS PROCEEDS
<S> <C> <C> <C>
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
</TABLE>
OPTION 4 - LIFE INCOME
Payments, determined from the table shown below for the option
elected, are based on the payee's 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.
MONTHLY PAYMENTS PER $1,000 OF PROCEEDS
MONTHLY PAYMENTS PER $1,000 OF PROCEEDS
PAYEE'S OPTION 4 OPTION 4B OPTION 4A OPTION 4B
AGE LIFE ONLY 10 YRS. CERTAIN PAYEE'S LIFE ONLY 10 YRS. CERTAIN
20 $3.29 $3.29 68 $6.37 $6.08
25 3.38 3.38 69 6.57 6.24
30 3.49 3.49 70 6.79 6.40
35 3.63 3.62 71 7.02 6.56
40 3.81 3.80 72 7.27 6.73
45 4.03 4.01 73 7.54 6.91
50 4.32 4.29 74 7.83 7.09
51 4.38 4.35 75 8.14 7.27
52 4.45 4.41 76 8.47 7.46
53 4.52 4.48 77 8.84 7.65
54 4.60 4.55 78 9.22 7.83
55 4.68 4.63 79 9.64 8.01
56 4.77 4.71 80 10.10 8.19
57 4.86 4.80 81 10.58 8.36
58 4.96 4.88 82 11.11 8.53
59 5.06 4.98 83 11.67 8.69
60 5.17 5.08 84 12.27 8.83
61 5.29 5.18 85 12.92 8.97
62 5.42 5.29 86 13.61 9.09
63 5.55 5.41 87 14.35 9.20
64 5.69 5.53 88 15.13 9.30
65 5.85 5.66 89 15.97 9.39
66 6.01 5.80 90 16.85 9.47
67 6.19 5.94
Page 22
1151(21/22)U PRINTED IN U.S.A.
<PAGE>
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
ELECTION OF OWNER
DEATH PROCEEDS PAYABLE AT DEATH OF LAST SURVIVING 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 DEATH BENEFIT GUARANTEE AMOUNT IS A DEATH BENEFIT
GUARANTEE SUBJECT TO THE CONDITIONS DESCRIBED ON PAGE 14.
[LOGO]
LAST SURVIVOR FLEXIBLE PREMIUM
VARIABLE LIFE INSURANCE POLICY
LA-1151(98) PRINTED IN U.S.A.
<PAGE>
[LOGO]
HARTFORD LIFE
SINGLE LIFE YEARLY
RENEWABLE TERM LIFE
INSURANCE RIDER
BENEFIT We will pay the Rider Face Amount upon receipt at Our
National Service Center of due proof of the Designated
Insured's death while the Policy and this rider were in
force.
DEFINITIONS The definitions in this section apply to the following words
and phrases whenever and wherever they appear in this rider.
The period for which this rider is payable is shown in the
Additional Benefits and Riders section of the Policy
Specifications.
DESIGNATED INSURED means the person shown in the Additional
Benefits and Riders section of the Policy Specifications.
RIDER ANNIVERSARY means an anniversary of the Rider Date.
Similarly, Rider Years are measured from the Rider Date.
TERMINATION DATE means the date so shown for this rider in
the Additional Benefits and Riders section of the Policy
Specifications.
RIDER DEATH There are two Death Benefit options available under this
rider.
BENEFIT 1. Under the Level Death Benefit Option, the Rider Death
Benefit is the Rider Face Amount on the date of
Designated Insured's death.
2. Under the Return of Premium Death Benefit Option, the
Rider Death Benefit is the Rider Face Amount on the
date of the Designated Insured's death plus the sum
of all the premiums paid to the date of the designated
Insured's death.
The Death Benefit Option and the Rider Face Amount for this
rider are shown in the Additional Benefits and Riders
section of the Policy Specifications.
RIDER CHARGE The monthly charge for this rider in any rider year is equal
to:
(a) the rider rate per $1,000 for the year; multiplied by
(b) the Rider Face Amount; divided by
(c) $1,000.
The monthly charge for this rider will be deducted on each
Monthly Activity Date from the Account Value as part of the
Monthly Deduction Amount.
The rider rate is determined annually on the Rider
Anniversary. It is based on the Policy Year, sex, Issue Age
and insurance class of the designated Insured.
The rider rate per $1,000 for a designated Insured will be
determined by Us based on future expectations for 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. No
changes in insurance class or cost will occur on account of
deterioration of the Insured's health.
The rider rates used per $1,000 for a designated Insured
will not exceed those in the Table of Monthly Maximum Rates,
shown on the Rider Specifications Page.
LA-1150(98) Printed in U.S.A.
<PAGE>
GENERAL PROVISIONS This rider is part of the Policy to which it is attached.
Except where this rider provides otherwise, it is subject to
all conditions and limitations of such policy.
This rider is issued in consideration of the application, a
copy of which is attached and payment of the required cost
of this rider. The Date of Issue of this rider is shown in
the Additional Benefits and Riders section of the Policy
Specifications.
INCONTESTABILITY We cannot contest this rider after it has been in force,
during the designated Insured's lifetime, for 2 years from
its Date of Issue, except for non payment of the required
cost of this rider.
SUICIDE If, within 2 years from the Date of Issue of this rider, the
designated Insured dies by suicide, while sane or insane,
Our liability under this rider will be limited to an amount
equal to the total cost of this rider.
AGE AND SEX If on the date of the designated Insured's death:
(a) the Issue Age of the designated Insured is understated;
or
(b) the sex of the designated Insured is incorrectly stated
such that it resulted in lower rider costs,
the Rider Death Benefit will be reduced to the amount that
would have been provided by the last rider cost at the
correct Issue Age and/or sex of the designated Insured.
If on the date of the designated Insured's death:
(a) the Issue Age of the designated Insured is overstated;
or
(b) the sex of the designated Insured is incorrectly stated
such that it resulted in higher rider costs,
the Rider Death Benefit will be adjusted by the return of
all excess rider costs prior to the date of the designated
Insured's death.
TERMINATION To terminate this rider, notify Us In Writing. Termination
will occur on the Monthly Activity Date next following the
date We receive the written request. Otherwise, it will
continue to the earliest of the following:
(a) this rider's termination date; or
(b) the Policy's Scheduled Maturity Date; or
(c) when the Policy terminates; or
(d) upon the death of the designated Insured; or
(e) when this rider explicitly terminates pursuant to a
provision in the Policy.
Signed for HARTFORD LIFE AND ANNUITY INSURANCE COMPANY
/s/Lynda Godkin /s/ Lowndes A. Smith
----------------------- --------------------------
Lynda Godkin, SECRETARY Lowndes A. Smith, PRESIDENT
LA-1150(98) Printed in U.S.A.
<PAGE>
[LOGO]
HARTFORD LIFE
SINGLE LIFE YEARLY
RENEWABLE TERM LIFE
INSURANCE RIDER
BENEFIT We will pay the Rider Face Amount upon receipt at Our
National Service Center of due proof of the Designated
Insured's death while the Policy and this rider were in
force.
DEFINITIONS The definitions in this section apply to the following words
and phrases whenever and wherever they appear in this rider.
The period for which this rider is payable is shown in the
Additional Benefits and Riders section of the Policy
Specifications.
DESIGNATED INSURED means the person shown in the Additional
Benefits and Riders section of the Policy Specifications.
RIDER ANNIVERSARY means an anniversary of the Rider Date.
Similarly, Rider Years are measured from the Rider Date.
TERMINATION DATE means the date so shown for this rider in
the Additional Benefits and Riders section of the Policy
Specifications.
RIDER DEATH There are two Death Benefit options available under this
rider.
BENEFIT 1. Under the Level Death Benefit Option, the Rider Death
Benefit is the Rider Face Amount on the date of
Designated Insured's death.
2. Under the Return of Premium Death Benefit Option, the
Rider Death Benefit is the Rider Face Amount on the
date of the Designated Insured's death plus the sum of
all the premiums paid to the date of the designated
Insured's death.
The Death Benefit Option and the Rider Face Amount for this
rider are shown in the Additional Benefits and Riders
section of the Policy Specifications.
RIDER CHARGE The monthly charge for this rider in any rider year is equal
to:
(a) the rider rate per $1,000 for the year; multiplied by
(b) the Rider Face Amount; divided by
(c) $1,000.
The monthly charge for this rider will be deducted on each
Monthly Activity Date from the Account Value as part of the
Monthly Deduction Amount.
The rider rate is determined annually on the Rider
Anniversary. It is based on the Policy Year, Issue Age and
insurance class of the designated Insured.
The rider rate per $1,000 for a designated Insured will be
determined by Us based on future expectations for 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 and insurance class. No
changes in insurance class or cost will occur on account of
deterioration of the Insured's health.
The rider rates used per $1,000 for a designated Insured
will not exceed those in the Table of Monthly Maximum Rates,
shown on the Rider Specifications Page.
LA-1150(98)U Printed in U.S.A.
<PAGE>
GENERAL PROVISIONS This rider is part of the Policy to which it is attached.
Except where this rider provides otherwise, it is subject to
all conditions and limitations of such policy.
This rider is issued in consideration of the application, a
copy of which is attached and payment of the required cost
of this rider. The Date of Issue of this rider is shown in
the Additional Benefits and Riders section of the Policy
Specifications.
INCONTESTABILITY We cannot contest this rider after it has been in force,
during the designated Insured's lifetime, for 2 years from
its Date of Issue, except for non payment of the required
cost of this rider.
SUICIDE If, within 2 years from the Date of Issue of this rider, the
designated Insured dies by suicide, while sane or insane,
Our liability under this rider will be limited to an amount
equal to the total cost of this rider.
AGE If on the date of the designated Insured's death, the Issue
Age of the designated Insured is understated, the Rider
Death Benefit will be reduced to the amount that would have
been provided by the last rider cost at the correct Issue
Age of the designated Insured.
If on the date of the designated Insured's death, the Issue
Age of the designated Insured is overstated, the Rider Death
Benefit will be adjusted by the return of all excess rider
costs prior to the date of the designated Insured's death.
TERMINATION To terminate this rider, notify Us In Writing. Termination
will occur on the Monthly Activity Date next following the
date We receive the written request. Otherwise, it will
continue to the earliest of the following:
(a) this rider's termination date; or
(b) the Policy's Scheduled Maturity Date; or
(c) when the Policy terminates; or
(d) upon the death of the designated Insured; or
(e) when this rider explicitly terminates pursuant to a
provision in the Policy.
Signed for HARTFORD LIFE AND ANNUITY INSURANCE COMPANY
/s/Lynda Godkin /s/ Lowndes A. Smith
----------------------- --------------------------
Lynda Godkin, SECRETARY Lowndes A. Smith, PRESIDENT
LA-1150(98)U Printed in U.S.A.
<PAGE>
EXHIBIT 1.2
[LOGO]
HARTFORD LIFE
APPLICATION
FOR
LIFE INSURANCE
<PAGE>
AGENT: THIS NOTICE MUST BE REMOVED AND LEFT WITH THE PROPOSED INSURED(S)
HARTFORD LIFE INSURANCE COMPANY
HARTFORD LIFE AND ANNUITY INSURANCE COMPANY
NATIONAL SERVICE CENTER ADDRESS:
P.O. BOX 59179
MINNEAPOLIS, MN 55459
INVESTIGATIVE CONSUMER REPORT PRE-NOTIFICATION
Federal and state laws require notification that, in connection with your
application, we may request an investigative consumer report. In addition,
such a report may be requested subsequently to update our records if you
apply for additional coverage. You may request to be interviewed in
connection with the preparation of the investigative consumer report. Within
5 business days of receiving your written request, we will inform you whether
or not an investigative consumer report was requested and, if such a report
was requested, the address and telephone number of the investigative agency
to which the request was made. By contacting the local office and providing
proper identification, you may inspect or, for the appropriate fee, receive a
copy of such report. The investigative agency may retain information they
gather and disclose it at a later date to other persons.
Typically the report will contain information as to character, general
reputation, personal characteristics and mode of living, which information is
obtained through an interview with you or an adult member of your family,
employers or business associates, financial sources, friends, neighbors or
others with whom you are acquainted. The information will consist, when
applicable, of a confirmation of your identity, age, residence, marital
status, and past and present employment including occupational duties,
financial information, driving record, sports and recreational activities,
health history, use of alcohol or drugs, if any, living conditions and type
of community.
MEDICAL INFORMATION BUREAU (MIB) PRE-NOTIFICATION
Information regarding your insurability will be treated as confidential.
Hartford Life Insurance Company or Hartford Life and Annuity Insurance
Company or its reinsurer(s) may, however, make a brief report thereon to the
Medical Information Bureau, a non-profit membership organization of life
insurance companies, which operates an information exchange on behalf of its
members. If you apply to another Bureau member company for life or health
insurance coverage, or a claim for benefits is submitted to such a company,
the Bureau, upon request, will supply such a company, with the information in
its file.
Upon receipt of a request from you, the Bureau will arrange disclosure of any
information it may have in your file. If you question the accuracy of
information in the bureau's file, you may contact the Bureau and seek a
correction in accordance with the procedures set forth in the Federal Fair
Credit Reporting Act. The address of the Bureau's information office is Post
Office Box 105, Essex Station, Boston, Massachusetts 02112, telephone number
(617)426-3660.
Hartford Life Insurance Company or Hartford Life and Annuity Insurance
Company or its reinsurer(s) may also release information in their files to
other life insurance companies to whom you may apply for life or health
insurance, or to whom a claim for benefits may be submitted.
PERSONAL HISTORY INTERVIEW
To provide you, our client, with the best possible service, we may follow-up
your application for insurance with what we call a personal history
interview. This is a phone call placed from our underwriting office. Its
purpose is to make sure that our application information is accurate and
complete.
We strive to make you the best possible offer for your premium dollar. The
personal history interview gives us the opportunity to gather the information
necessary for fair and prompt processing of your application.
Our interviewers are trained to conduct their calls in a friendly,
professional manner. The nature of the information discussed is always
treated as personal and confidential.
<PAGE>
// HARTFORD LIFE INSURANCE COMPANY [LOGO]
// HARTFORD LIFE AND ANNUITY INSURANCE COMPANY HARTFORD LIFE
<TABLE>
<CAPTION>
PART A
- ----------------------------------------------------------------------------------------------------------------------------------
1. PROPOSED INSURED INFORMATION - COMPLETE FOR ALL APPLICATIONS.
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C>
a. Name of Proposed Insured b. Age C. Sex f. Date of Birth h. Social Sec. No.
----------------------------------------------------------------------------------------------
d. Height e. Weight g. Place of Birth
- ----------------------------------------------------------------------------------------------------------------------------------
i. Residence Address j. How Long? k. Former Residence l. How Long?
- ----------------------------------------------------------------------------------------------------------------------------------
m. City, State Zip n. City, State Zip
- ----------------------------------------------------------------------------------------------------------------------------------
o. Occupation/Duties p. How Long? q. Employer's Name and Address
- ----------------------------------------------------------------------------------------------------------------------------------
2. PROPOSED JOINT INSURED/OTHER COVERED INSURED INFORMATION - COMPLETE IF APPLICABLE.
- ----------------------------------------------------------------------------------------------------------------------------------
a. Name of Proposed Insured b. Age c. Sex f. Date of Birth h. Social Sec. No.
----------------------------------------------------------------------------------------------
d. Height e. Weight g. Place of Birth
- ----------------------------------------------------------------------------------------------------------------------------------
i. Residence Address j. How Long? k. Former Residence l. How Long?
- ----------------------------------------------------------------------------------------------------------------------------------
m. City, State Zip n. City, State Zip
- ----------------------------------------------------------------------------------------------------------------------------------
o. Occupation/Duties p. How Long? q. Employer's Name and Address
- ----------------------------------------------------------------------------------------------------------------------------------
3. OWNER / BENEFICIARY INFORMATION - COMPLETE FOR ALL APPLICATIONS.
- ----------------------------------------------------------------------------------------------------------------------------------
a. Policy Owner Name and Address. b. Soc. Sec. No. or Tax ID c. Relationship to
Proposed Insured(s)
------------------------------------------------------------
d. Owner is:
//Individual //Partnership //Corporation //Trustee
- ----------------------------------------------------------------------------------------------------------------------------------
c. Primary Beneficiary(s). Names(s)/Address/Soc. Sec. # f. Relationship to g. % of Death Benefit
Proposed Insured(s)
- ----------------------------------------------------------------------------------------------------------------------------------
h. Contingent Beneficiary. Names(s)/Address/Soc. Sec. # i. Relationship to Proposed Insured(s)
- ----------------------------------------------------------------------------------------------------------------------------------
4. LIFE INSURANCE PLAN INFORMATION - COMPLETE FOR ALL APPLICATIONS.
- ----------------------------------------------------------------------------------------------------------------------------------
a. Name of Basic Policy b. Face Amount of Policy (Indicated amount of Basic h. Send Billing/Correspondence to Proposed Insured's
Face Amount and Supplemental Face Amount, if //Residence //Business
applicable) //Policy Owner //Other:____________________
- ----------------------------------------------------------------------------------------------------------------------------------
c. Death Benefit Options (Choose One) i. Addition Benefits
// Option A (Level) // Option C // Waiver of Premium //Accidental Death Benefit
(Return of Premium) // ____% Increase in Face Amount for __ Years(s)
// Option B (Return of //Other (Last Survivor Interest Sensitive Life Plans Only)
Account Value) // Increase in Coverage Option Rider
- ------------------------------------------------------------------------ (Individual Variable Life Plans Only)
d. Automatic Premium Loan // Yes // No // Additional Insurance Benefit
- ------------------------------------------------------------------------ $__________Premium for ________Year(s)
e. Is this Insurance Part of a If "YES", do you work // Other: _________// See Attached Sheet
Qualified Retirement Plan? on a full time basis? ----------------------------------------------------------
// Yes // No // Yes // No j. Issue Policy if offered on a Requested Policy
- ----------------------------------------------------------------------- Special Class Basis? //Yes //No Date:___________
f. Is this Insurance Part of a If "YES", if you are an employee, have --------------
Corporate Owned Life you have active at work at least 30 ----------------------------------------------------------
Insurance Plan? hours per week for the past 90 days k. Special Requests (Attach Additional sheet
// Yes // No doing your usual duties at your if necessary.)
normal place of work?
// Yes // No
- ----------------------------------------------------------------------
g. Premiums to be Paid
//Annually //Semi-annually //Quarterly // COM
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
APPLICATION CONTINUED
<PAGE>
PART B
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
5.
Proposed
Joint/Other
ANSWER THE FOLLOWING QUESTIONS AND GIVE DETAILS Proposed Covered
OF "YES" ANSWERS UNDER # /7./ BELOW Insured Insured
-----------------------------------
YES NO YES NO
- ----------------------------------------------------------------------------------------------------------------------------------
a. DURING THE PAST 5 YEARS HAVE YOU CONSULTED A PHYSICIAN OR
VISITED A CLINIC OR HOSPITAL AS A PATIENT? // // // //
- ----------------------------------------------------------------------------------------------------------------------------------
b. HAVE YOU had insurance rejected or offered with an extra premium? // // // //
- ----------------------------------------------------------------------------------------------------------------------------------
c. DO YOU plan to travel or reside outside the United States? (If yes, state
when, where, how long.) // // // //
- ----------------------------------------------------------------------------------------------------------------------------------
d. HAVE YOU smoked cigarettes in the past 12 months? // // // //
- ----------------------------------------------------------------------------------------------------------------------------------
e. HAVE YOU used any other form of tobacco or nicotine replacement therapy in
the past 12 months (for example - cigars, pipes, chewing tobacco, nicorette gum,
nicotine patch or nasal spray)? (If yes, specify substance(s).) // // // //
- ----------------------------------------------------------------------------------------------------------------------------------
f. HAVE YOU ever been arrested for drug possession, or had or been advised to
have treatment for alcohol or drug abuse? // // // //
- ----------------------------------------------------------------------------------------------------------------------------------
g. WILL YOU replace or change life insurance or annuities in any company if
this policy is issued?
IF "YES", GIVE DETAILS. // // // //
- ----------------------------------------------------------------------------------------------------------------------------------
6. HAVE YOU EVER HAD OR BEEN TREATED FOR:
a. Diabetes, heart attack, angina, chest pain, stroke, heart murmur, high blood
pressure, or other heart, blood or circulatory disorder? // // // //
- ----------------------------------------------------------------------------------------------------------------------------------
b. Emotional or nervous disorder, epilepsy, convulsions, brain or spinal cord
disorder, cancer or tumor? // // // //
- ----------------------------------------------------------------------------------------------------------------------------------
c. Any disease of the kidney, liver, lung, lymph glands, muscles, bones,
stomach or intestines, AIDS, AIDS Related Complex or any immune deficiency disorder? // // // //
- ----------------------------------------------------------------------------------------------------------------------------------
Question NAME OF 7. GIVE COMPLETE DETAILS INCLUDING NAMES AND ADDRESSES OF DOCTORS AND HOSPITALS
Number PERSON
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
8. DO YOU HAVE LIFE INSURANCE IN FORCE OR APPLIED FOR? GIVE COMPANY, AMOUNT, PLAN,
ISSUE YEARS, OWNERSHIP AND IF WAIVER OF PREMIUM OR ACCIDENTAL DEATH BENEFITS ARE
INCLUDED.
- ----------------------------------------------------------------------------------------------------------------------------------
Proposed Insured //YES NO// Proposed Joint Insured //YES //NO
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
9. VARIABLE LIFE PLAN INFORMATION - COMPLETE IF APPLICABLE.
- ----------------------------------------------------------------------------------------------------------------------------------
a. Dollar Cost Averaging Option //YES // NO h. NET PREMIUM ALLOCATION. SELECT UP TO 9 SUBACCOUNTS
(Available on an Annual Mode Only) (0 OR MINIMUM OF 10%. MUST TOTAL 100%).
- ---------------------------------------------------------- IF USING SUPPLEMENT, DISREGARD THIS SECTION.
b. Guarantee Period
- ----------------------------------------------------------
SUITABILITY YES NO FUND NAME % ALLOCATED
- ----------------------------------------------------------
c. Do you believe that this policy will // // --------------------- -----------%
meet your insurance needs and financial
objectives? --------------------- -----------%
- ----------------------------------------------------------
d. DO YOU UNDERSTAND THAT THE AMOUNT AND // // --------------------- -----------%
DURATION OF THE DEATH BENEFIT MAY VARY,
DEPENDING ON THE INVESTMENT PERFORMANCE --------------------- -----------%
OF THE VARIABLE ACCOUNTS IN THE SEPARATE
ACCOUNT? --------------------- -----------%
- ----------------------------------------------------------
e. DO YOU UNDERSTAND THAT THE POLICY VALUES --------------------- -----------%
MAY INCREASE OR DECREASE, DEPENDING
ON THE INVESTMENT PERFORMANCE OF THE --------------------- -----------%
VARIABLE ACCOUNTS IN THE SEPARATE ACCOUNT?
- ---------------------------------------------------------- --------------------- -----------%
f. Did you receive the separate account
prospectus for the policy applied for? FIXED ACCOUNT
- ---------------------------------------------------------- --------------------- -----------%
g. Date of Separate Account Prospectus:
-------------------
- ----------------------------------------------------------------------------------------------------------------------------------
APPLICATION CONTINUED
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
PART C
10.
Proposed
Joint/Other
HAZARDOUS ACTIVITIES OF PROPOSED INSURED(S) - COMPLETE FOR ALL APPLICATIONS. Proposed Covered
PLEASE ANSWER ALL QUESTION "YES" OR "NO." EXPLAIN "YES" ANSWERS IN THE SPACE Insured Insured
PROVIDED. -----------------------------------
YES NO YES NO
- ----------------------------------------------------------------------------------------------------------------------------------
a. Within the past 3 years, have you been convicted of, pleaded guilty or no
contest to:
(I). three or more moving violations and/or accidents? / / / / / / / /
(II). driving under the influence of alcohol and/or drugs? / / / / / / / /
IF "YES", EXPLAIN:
- ----------------------------------------------------------------------------------------------------------------------------------
b. Have you ever been convicted of a felony or misdemeanor other than a minor
traffic violation? / / / / / / / /
IF "YES", EXPLAIN:
- ----------------------------------------------------------------------------------------------------------------------------------
c. Are you a member, or do you intend to become a member, of the armed forces,
including the Reserves? / / / / / / / /
IF "YES", EXPLAIN:
- ----------------------------------------------------------------------------------------------------------------------------------
d. Except for vacation trips, do you intend to travel outside the U.S. or Canada
within the next two years? / / / / / / / /
IF "YES", EXPLAIN:
- ----------------------------------------------------------------------------------------------------------------------------------
e. Do you participate in aeronautics (hang-gliding, soaring, sky-diving,
ballooning, etc.)? / / / / / / / /
IF "YES", EXPLAIN:
- -------------------------------------------------------------------------------------------
Jumps/Flights Total # of jumps/Flights Name of Club Date Last Jump/Flight
per year
- ----------------------------------------------------------------------------------------------------------------------------------
f. Do you race, test or stunt drive automobiles, motorcycles, motor boats, or
jet powered vehicles, or do you use or race snow mobiles, dirt bikes, dune buggies, etc.? / / / / / / / /
IF "YES", COMPLETE BELOW:
- --------------------------------------------------------------------------------------------
Type of vehicle Type of terrain/race/course # of Races or Date of Last Race or Use
Uses/year
- ----------------------------------------------------------------------------------------------------------------------------------
g. Do you participate in skin or scuba diving? / / / / / / / /
IF "YES", COMPLETE BELOW:
- -------------------------------------------------------------------------------------------
Depth of Dives # of Times per Year Name of Club Date of Last Dive
- ----------------------------------------------------------------------------------------------------------------------------------
h. Do you participate in any other hazardous sports or activities (mountain
climbing, competitive skiing, rodeos, etc.? IF "YES", EXPLAIN: / / / / / / / /
- ----------------------------------------------------------------------------------------------------------------------------------
i. Have you ever engaged in or do you plan to engage in any aviation activity
other than as a fare-paying passenger? / / / / / / / /
IF "YES", COMPLETE THE REMAINDER OF THIS SECTION.
- ----------------------------------------------------------------------------------------------------------------------------------
j. What types and kinds of planes do you fly or intend to fly?
- ----------------------------------------------------------------------------------------------------------------------------------
PERSON FLIGHT STATUS PILOT-MILITARY OR RESERVE PILOT-CIVILIAN CREW MEMBER
- ----------------------------------------------------------------------------------------------------------------------------------
HOURS FLOWN
PAST 12 MOS.
- ----------------------------------------------------------------------------------------------------------------------------------
HOURS FLOWN
1-2 YRS. AGO
- ----------------------------------------------------------------------------------------------------------------------------------
HOURS NEXT
12 MONTHS
- ----------------------------------------------------------------------------------------------------------------------------------
Total Solo Hours Total Hours Flown as a Pilot Date of Last Flight
- ----------------------------------------------------------------------------------------------------------------------------------
k. Type of Pilot's Certificate(s) or Rating(s)? (check as appropriate)
//Student //Private //Commercial //ATR //IFR
Year Issued:
--------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
l. If aviation avocation does not qualify for aviation coverage without
additional premium, issue policy as follows:
//Aviation Coverage with Extra Premium // Aviation Exclusion Rider
- ----------------------------------------------------------------------------------------------------------------------------------
REMARKS - IDENTIFY QUESTION, PROPOSED INSURED, AND ADDITIONAL DETAILS
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
APPLICATION CONTINUED
<PAGE>
PART D
<TABLE>
<CAPTION>
<S> <C>
11. AGREEMENT AND ACKNOWLEDGEMENT - COMPLETE FOR ALL APPLICATIONS.
- ----------------------------------------------------------------------------------------------------------------------------------
Each of the undersigned declares that: the statements and answers contained in this application are complete and true to the best
of each person's knowledge and belief; and each agrees that coverage can take effect only if the Proposed Insured(s) is/are alive
and all answers material to the risk are still true and complete when the policy is delivered and paid for. I/We agree that the
statements and answers contained in this application shall form the basis of any contract for life insurance that may be issued;
and, a copy of this application shall be attached to and made part of the policy. I/We have received a copy of the Company
Compliance Illustration for the life insurance applied for herein.
I/We agree that only an Officer of the Company may alter the terms of the application, the Conditional Receipt or the policy, or
waive any of the Company's rights or requirements.
Signed at this day of 19 .
---------------------------- ----------- ------------------------------ ----------
X
----------------------------------------------------- -----------------------------------------------------------
Signature of PROPOSED INSURED SIGNATURE OF PROPOSED JOINT INSURED / OTHER COVERED INSURED
(PARENT OR GUARDIAN IF UNDER 15 YEARS OF AGE) (PARENT OR GUARDIAN IF UNDER 15 YEARS OF AGE)
$ X
------------------------------------------- ------------------------------------------------------------
Amount Received with Application Signature of APPLICANT/OWNER if other than Proposed Insured(s)
------------------------------------------------------------
Signature of Licensed Agent
- ---------------------------------------------------------------------------------------------------------------------------------
12. AUTHORIZATION TO OBTAIN, RELEASE, AND DISCLOSE INFORMATION - COMPLETE FOR ALL APPLICATIONS.
- ---------------------------------------------------------------------------------------------------------------------------------
I authorize Hartford Life Insurance Company or Hartford Life and Annuity Insurance Company (Hartford) to complete a Personal
History Interview and to obtain an Investigative Consumer Report on me or on my children. I authorize the release of any medical
or non-medical information that relates to: (1) past or current health conditions including illnesses; sicknesses; diseases;
disabilities; disorders; accidents; or injuries; (2) confinements in any hospital; medical facility; or medical clinic; (3)
outpatient treatment in any hospital; hospital emergency room; medical facility; or clinic; (4) treatment for alcohol abuse; drug
abuse; or mental health protected by Federal Law.
This information may be released by any person or organization that has records or knowledge of my health or of the health of my
children, if they are applying for insurance. This includes any doctor; medical professional; health practitioner; therapist;
counselor; hospital; clinic; insurer; reinsurer; consumer reporting firm; employer or the Medical Information Bureau (MIB). This
information may be released for the purpose of determining eligibility for insurance under a new or an existing policy.
This information may be released to Hartford or to their legal representative. I understand that the MIB will release records
of information only to Hartford.
Hartford may release the information in their file(s) to: their reinsurers; the MIB; any other insurance company to whom I or my
children apply for life or health insurance; or other persons and/or organizations performing business or legal services in
connection with this application or a claim. Except as specified, this information will not be given, sold or transferred to any
person without first obtaining my consent. This consent must be written and state the use and the need for such information.
I understand that if I request details about any of the medical information gathered about me or my children which relates to
this application; (a) the medical information; and, (b) the identity of the medical care institution or the medical person who
provided the information; shall be released to me or to a licensed medical person of my choice.
Upon written request, I will receive details of the method I must use to exercise my right to access, correct and amend any
information gathered about me or my children which relates to this application. I may revoke, upon written request, the right to
use this consent form except to the extent that action has already been taken. A photocopy of this consent form is as valid as
the original. When requested in writing, I will receive a copy of this form. This consent form will expire: two years from the
date of the contract; or, one year from the date below, if no contract has yet been issued.
Dated Signed X
---------------------------- --------------------------------------------------------------
PROPOSED INSURED (Parent or Guardian if under 15 years of Age)
Dated Signed
---------------------------- -----------------------------------------------------------
PROPOSED JOINT INSURED / OTHER COVERED INSURED
(PARENT OR GUARDIAN IF UNDER 15 YEARS OF AGE)
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
APPLICATION CONTINUED
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
- -----------------------------------------------------------------------------------------------------------------------------------
PART E
AGENT INFORMATION - COMPLETE FOR ALL APPLICATIONS.
- -----------------------------------------------------------------------------------------------------------------------------------
1. How well do you know the Proposed Insured(s)?
- -----------------------------------------------------------------------------------------------------------------------------------
2. Do you have knowledge or reason to believe that replacement of existing life
insurance or annuities is involved in this transaction?
- -----------------------------------------------------------------------------------------------------------------------------------
3. Personal History Interview
Most convenient time to call //Morning //Afternoon
Place to call //Home //Business //Phone number
---------------------
May we interview the Spouse of an adult member of the family: //Yes //No
Show any unusual name pronunciation phonetically.
---------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
4. Estimated annual income, net worth and marital status of Proposed Insured(s)?
- -----------------------------------------------------------------------------------------------------------------------------------
5. Give the purpose of this insurance and the nature of the Owner/Applicant's
insurance interest.
- -----------------------------------------------------------------------------------------------------------------------------------
6. Policy Information: (COMPLIANCE ILLUSTRATION MUST ACCOMPANY EACH APPLICATION.)
Annual Scheduled Premium: First Year $ Subsequent Years $
---------------------- -----------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
7. This Application is submitted on the following basis: //Medically //Non-medically
//Other
Has a medical examination been arranged? //Yes //No
- -----------------------------------------------------------------------------------------------------------------------------------
REMARKS - IDENTIFY QUESTION AND GIVE DETAILS
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
IF THE APPLICATION PACKAGE IS NOT BEING SUBMITTED THROUGH YOUR BROKER/DEALER, CONTACT THAT BROKER/DEALER FOR THEIR SUITABILITY
REQUIREMENTS. WE SUGGEST YOU SEND YOUR BROKER/DEALER A COPY OF PART A (PAGE 1), SECTION 9, (PAGE 2) (SUITABILITY AND FUND
SELECTION) AND PART E (AGENT INFORMATION) OF THE APPLICATION, ALONG WITH A COPY OF THE ILLUSTRATION USED IN THE FINAL SALE.
- -----------------------------------------------------------------------------------------------------------------------------------
PRODUCER CERTIFICATION - COMPLETE FOR ALL APPLICATIONS.
- -----------------------------------------------------------------------------------------------------------------------------------
1. I CERTIFY that I asked each question separately; the answers were recorded as given; and, they are complete and accurate
to the best of my knowledge and belief.
2. I CERTIFY that I am duly licensed in the state in which this application was signed.
3. I have given the Proposed Insured(s) the appropriate Disclosure documents.
4. For Variable Life Business, I CERTIFY that I am a NASD Registered Representative.
5. I have complied with state and federal laws on disclosure, cost comparison and replacement.
6. I have reviewed the purchase of this insurance policy as to suitability.
X
-------------------------------------- ------------------------------------
Signature(s) of Writing Agent(s). Writing Agent's Code Number
- -----------------------------------------------------------------------------------------------------------------------------------
PAY COMMISSIONS AS INDICATED BELOW (COMMISSION SPLITS ARE AT WRITING AGENT LEVEL) SPLIT
- -----------------------------------------------------------------------------------------------------------------------------------
AGENT NAME AGENT CODE SOCIAL SEC./TAX I.D. 1st Yr. Renewal
- --------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
Sales Office Use Only: F.O.# Staff Code Advanced Und. Code Marketing Code
------ ------- ------- -------
- -----------------------------------------------------------------------------------------------------------------------------------
WHEN CONDITIONAL RECEIPT CAN BE USED
- -----------------------------------------------------------------------------------------------------------------------------------
An advance payment may be accepted and the Conditional Receipt may be given ONLY under the following conditions:
1. The advance premium is at least equal to the amount of THE FULL FIRST PREMIUM FOR THE MODE SELECTED.
2. The answers in Part B, questions 5f AND 6 ARE "NO".
3. The Proposed Insured(s) appear to be STANDARD RISKS in all respects.
4. The Conditional receipt is given and the advance premium is collected ONLY AT THE TIME THE APPLICATION IS TAKEN and signed.
5. The application does not contain a request for POSTDATING.
6. The AGENT DOES NOT MAKE AN ADVANCE PAYMENT for the Proposed Insured or Applicant. If this is done, loss of the agent's
license could result.
7. The proposed Insured(s) is/are 75 YEARS OLD OR LESS, age last birthday.
8. The amount of insurance applied for does not exceed $500,000.
- -----------------------------------------------------------------------------------------------------------------------------------
AGENT'S REPORT
</TABLE>
<PAGE>
CONDITIONAL RECEIPT
VALID FOR USE WITH LIFE INSURANCE ON PROPOSED INSURED(S) AGE 75 OR LESS WITH
THE AMOUNTS OF INSURANCE APPLIED FOR NOT IN EXCESS OF $500,000.
If any person proposed for coverage has answered "Yes" to question 5f or 6,
NO PAYMENT may be accepted with the application.
1. NO COVERAGE WILL BECOME EFFECTIVE PRIOR TO DELIVERY OF THE POLICY APPLIED
FOR UNLESS AND UNTIL ALL THE CONDITIONS OF THIS RECEIPT HAVE BEEN FULFILLED
EXACTLY:
(a) The amount of payment taken with the application must be at least
equal to the amount of the full first premium for the mode of payment
selected in the application and for the amount of insurance which may
become effective prior to delivery of the policy.
(b) All medical examinations, test, x-rays and electrocardiograms required
by the Company must be completed and received at its National Service
Center in Minneapolis, Minnesota within 60 days from the date of
completion of Part 1 of this application.
(c) As of the effective date, as defined below, each person proposed for
insurance in this application must be a risk insurable in accordance
with the Company's rules, limits, and standards for the plan and the
amount applied for without any modification either as to plan, amount,
riders and/or the rate of premium paid.
(d) As of the effective date, the state of health and all factors affecting
the insurability of each and every person proposed for insurance must
be as stated in the application.
2. Subject to the conditions of paragraph 1, insurance, as provided by the
terms and conditions of the policy applied for and in use on the effective
date, but for an amount not exceeding that specified in paragraph 3, will
become effective as of the effective date. "Effective date", as used
herein, is the later of: (a) the date of completion of Part 1 of the
application, or (b) the date of completion of all medical examinations,
tests, x-rays and electrocardiograms required by the Company. The effective
date is determined separately for each person proposed for coverage.
3. The total amount of insurance which may become effective on any person
proposed for insurance shall not exceed $500,000 of life insurance,
including any accidental death insurance benefits.
4. If one or more of the conditions of paragraph 1 have not been fulfilled
exactly, there shall be no liability on the part of the Company except to
return the applicable payment in exchange for this Receipt.
5. NO AGENT OR ANY OTHER PERSON IS AUTHORIZED BY THE COMPANY TO WAIVE OR
MODIFY IN ANY WAY ANY OF THE PROVISIONS OF THIS CONDITIONAL RECEIPT.
If all the conditions are not fulfilled exactly, the insurance will take
effect when the policy is delivered to the owner stated in the application;
but only if at the time of such delivery there has been no change in
insurability as represented in the application.
All premium checks must be made payable to the Insurance Company. Do not
make checks payable to the agent or leave the payee blank.
Received a check totaling $ from in connection
------------ ----------------
with the application for life insurance totaling $ , bearing the
-------------
same date as this Conditional Receipt.
Dated at this day of
----------------- ----------------
, 19 .
- ----------------- ----
---------------------------------
Signature of Agent
I acknowledge possession of this receipt and I certify that I have read it
and the agreement in the application. The terms and conditions of this
receipt, to which I agree, and the agreement in this application have been
explained to me fully by the agent and I understand them.
X
---------------------------------
Signature of Applicant
THIS RECEIPT IS TO BE DETACHED AND GIVEN TO THE APPLICANT AT THE TIME OF
APPLICATION IF ANY MONEY IS TAKEN
HO COPY
<PAGE>
EXHIBIT 1.3
[LOGO]
HARTFORD LIFE
November 16, 1998
LYNDA GODKIN, SENIOR VICE PRESIDENT,
GENERAL COUNSEL & CORPORATE SECRETARY
Board of Directors
Hartford Life and Annuity Insurance Company
200 Hopmeadow Street
Simsbury, CT 06089
RE: SEPARATE ACCOUNT VL II
HARTFORD LIFE AND ANNUITY INSURANCE COMPANY
INITIAL FILING
Dear Sir/Madam:
I have acted as General Counsel to Hartford Life and Annuity Insurance Company
(the "Company"), a Connecticut insurance company, and Hartford Life and Annuity
Insurance Company Separate Account VL II (the "Account") in connection with the
registration of an indefinite amount of securities in the form of last survivor
flexible premium variable life insurance policies (the "Policies") with the
Securities and Exchange Commission under the Securities Act of 1933, as amended.
I have examined such documents (including the Form S-6 Registration Statement)
and reviewed such questions of law as I considered necessary and appropriate,
and on the basis of such examination and review, it is my opinion that:
1. The Company is a corporation duly organized and validly existing as a stock
life insurance company under the laws of the State of Connecticut and is
duly authorized by the Insurance Department of the State of Connecticut to
issue the Policies.
2. The Account is a duly authorized and validly existing separate account
established pursuant to the provisions of Section 38a-433 of the
Connecticut Statutes.
3. To the extent so provided under the Policies, that portion of the assets of
the Account equal to the reserves and other contract liabilities with
respect to the Account will not be chargeable with liabilities arising out
of any other business that the Company may conduct.
4. The Policies, when issued as contemplated by the Form S-6 Registration
Statement, will constitute legal, validly issued and binding obligations of
the Company.
I hereby consent to the filing of this opinion as an exhibit to the Form S-6
Registration Statement for the Policies and the Account.
Sincerely,
/s/ Lynda Godkin
Lynda Godkin
<PAGE>
EXHIBIT 1.4
Organizational Chart
<TABLE>
<CAPTION>
<S> <C>
THE HARTFORD
The Hartford Financial Services Group, Inc.
(Delaware)
|
- -------------------------------------------------------------------------------------------------------------
Nutmeg Insurance Company The Hartford Investment
(Connecticut) Management Company
| (Delaware)
Hartford Fire Insurance Company |
(Connecticut) Hartford Investment
| Services, Inc.
Hartford Accident and Indemnity Company (Connecticut)
(Connecticut)
|
Hartford Life, Inc.
(Delaware)
|
Hartford Life and Accident Insurance Company
(Connecticut)
|
|
|
- -------------------------------------------------------------------------------------------------------------
Alpine Life Hartford Financial Hartford Life American Maturity ITT Hartford Canada
Insurance Services Life Insurance Company Life Insurance Holdings, Inc.
Company Insurance Co. (Connecticut) Company (Canada)
(New Jersey) (Connecticut) | (Connecticut) |
| | |
| AML Financial, Inc. |
| (Connecticut) Hartford Life
| Insurance Company
| of Canada
| (Canada)
|
|
- -------------------------------------------------------------------------------------------------------------
Hartford Life and Annuity ITT Hartford International Hartford Financial Services Royal Life
Insurance Company Life Reassurance Corporation Corporation Insurance
(Connecticut) (Connecticut) (Delaware) Company of
| | America
| | (Connecticut)
| |
ITT Hartford Life, Ltd. |
(Bermuda) |
|
|
- -------------------------------------------------------------------------------------------------------------
MS Fund HL Funding HL Investment Hartford Hartford Securities Hartford-Comp. Emp.
America Company, Inc. Advisors, Inc. Equity Sales Distribution Benefit Service
1993-K, Inc. (Connecticut) (Connecticut) Company, Inc. Company, Inc. Company
(Delaware) | (Connecticut) (Connecticut) (Connecticut)
|
Hartford Investment
Financial Services
Company
(Delaware)
</TABLE>
