As filed with the Securities and Exchange Commission on February 15, 2023
Registration No. 333-[ ]
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
MassMutual Ascend Life Insurance Company
(Exact name of registrant as specified in its charter)
Ohio | 6311 | 13-1935920 | ||
(State or other jurisdiction of incorporation or organization) |
(Primary Standard Industrial Classification Code Number) |
(I.R.S. Employer Identification Number) |
191 Rosa Parks Street, Cincinnati, Ohio 45202
(513) 361-9000
(Address, including zip code, and telephone number, including area code, of registrants principal executive offices)
John P. Gruber
MassMutual Ascend Life Insurance Company
191 Rosa Parks Street, Cincinnati, Ohio 45202
(513) 361-9000
(Name and Address of Agent of Service)
Approximate date of commencement of proposed sale to the public: As soon as practicable after this registration statement becomes effective.
If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. ☒
Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company or an emerging growth company.
Large accelerated filer | ☐ | Accelerated filer | ☐ | |||
Non-accelerated filer | ☒ | Smaller reporting company | ☐ | |||
Emerging growth company | ☐ |
The Registrant hereby amends this registration statement on such date or 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 Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.
MASSMUTUAL ASCEND LIFE INSURANCE COMPANY
Administrative Office: P.O. Box 5423, Cincinnati OH 45201-5423
Street Address: 191 Rosa Parks Street, Cincinnati OH 45202
Policy Administration: 1-800-789-6771
INDEX SUMMIT 6 PRO ANNUITY
With Return of Premium Guarantee
PROSPECTUS DATED [ ], 2023
The Index Summit 6 ® Pro annuity is an Individual Index-linked Modified Single Premium Deferred Annuity contract issued by MassMutual Ascend Life Insurance Company. It provides that we will pay the Annuity Payout Benefit to you in exchange for your Purchase Payments. It also provides a Death Benefit that will never be less than the return of premium guarantee.
The Contract is a modified single premium deferred annuity. This means we will accept Purchase Payments only during the purchase payment period, which ends two months after the Contract Effective Date.
A glossary of defined terms used herein can be found in the Special Terms section starting on page [ ] of this prospectus.
The Contract offers you the opportunity to allocate funds to Indexed Strategies for one-year, two-year, or six-year Terms. Indexed Strategies provide price returns based, in part, on the rise or fall of an Index, which may be a market index, such as the S&P 500 Index, or the share price of an exchange-traded fund, such as an iShares ETF. The returns of the S&P 500 Index do not reflect the payment of dividends by stocks that make up the Index.
For this Contract, we currently offer fifteen Indexed Strategies. Each of these Indexed Strategies uses one of five Indexes: S&P 500® Index, iShares® MSCI EAFE ETF, and iShares® U.S. Real Estate ETF, SPDR Gold Share ETF, and First Trust Barclays Edge Index. When an Index rises over a Term, Indexed Strategy values are determined using one of two positive return factors: either a Cap or an Upside Participation Rate. When an Index falls over a Term, Indexed Strategy values are determined using one of four negative return factors: either a 50% Downside Participation Rate, a 10% Buffer, a -10% Floor, or a 0% Floor. Note: Not all Indexed Strategies are available for Contracts issued in Missouri.
At the end of a Term, we may stop offering any Indexed Strategy, other than the S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate Indexed Strategy. The S&P 500 6-year 10% Buffer with Upside Participation Rate Indexed Strategy will only be available for Terms beginning in the first Contract Year. The S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate Indexed Strategy or any other Indexed Strategy that may be available in the future may earn a return that is lower than the return your investments would have earned if they had been invested in the other currently available Indexed Strategies. Any reduction in the available number of Index Strategies may reduce your opportunity to increase your Account Value.
Indexed Strategies. The value of an Indexed Strategy changes from day to day throughout each Term. The value of an Indexed Strategy is calculated using the Investment Base.
The Investment Base is the amount applied to the Indexed Strategy at the beginning of the current Term, reduced each day by the Daily Charge, and adjusted proportionally for any withdrawals taken during the current Term and any related Early Withdrawal Charge. During the Term, the Investment Base remains unchanged except for the Daily Charge and any proportional adjustments for withdrawals.
The Daily Charge is calculated as a percentage of the Investment Base. The Daily Charge is a rate that compounds to 0.75% per year.
The method used to calculate the Strategy value depends on whether the value is being calculated at the end of a Term or during a Term and on whether you have made a Performance Lock election.
At the end of a Term, unless you have made a Performance Lock election, the value of an Indexed Strategy is the Investment Base increased for any rise in the applicable Index over the Term or decreased for any fall in the applicable Index over the Term. For some Strategies, any increase for the Term is subject to a limit called the Cap (a Cap Strategy). For others, any increase for the Term is subject to a limit called the Upside Participation Rate (an Upside Participation Rate Strategy). For an Indexed Strategy with a Buffer (a Buffer Strategy), any decrease for the Term resulting from Index performance is subject to a limit called the Buffer. For an Indexed Strategy with a Floor (a Floor Strategy), any decrease for the Term resulting from Index performance is subject to a limit called the Floor. For all other Strategies, any decrease for the Term resulting from Index performance is subject to a limit called the Downside Participation Rate (a Downside Participation Rate Strategy).
| For a Cap Strategy, the Cap for a Term is the largest rise in the Index over the Term taken into account to determine the Strategy value at the end of the Term. We can change the Cap for each new Term of an Indexed Strategy. It will never be less than 1%. At least 10 days before the next Term starts, we will post the Caps for that Term on our website (www.massmutualascend.com/RILArates). |
| If the rise in the Index is greater than the Cap, the increase applied to the remaining Investment Base for the Term will be limited to the Cap and will be less than the rise in the Index. |
1
| If the rise in the Index is equal to the Cap, the increase applied to the remaining Investment Base for the Term will equal both the Cap and the rise in the Index. |
| If the rise in the Index is less than the Cap, the increase for the Term will be less than the Cap and will equal the rise in the Index applied to the remaining Investment Base. |
| In both cases, the increase for a Term will always be less than the Cap or the rise in the Index because the Daily Charge is subtracted from the Investment Base before applying the increase for the Index performance. |
| For an Upside Participation Rate Strategy, the Upside Participation Rate for a Term is the portion of any rise in the Index over the Term that is taken into account to determine the Strategy value at the end of the Term. We can change the Upside Participation Rate for each new Term of an Indexed Strategy. It never will be less than 5%. At least 10 days before the next Term starts, we will post the Upside Participation Rates for that Term on our website (www.massmutualascend.com/RILArates). The increase for the Term will be less than the rise in the Index unless the Participation Rate for the Term exceeds 100%. The increase for a Term will be less than the Upside Participation Rate multiplied by the rise in the Index because the Daily Charge is subtracted from the Investment Base before applying the increase for Index performance. |
| For a Buffer Strategy, the Buffer provides a buffer against the first 10% of any fall in the Index over the Term to determine the Strategy value for the Buffer Strategy at the end of the Term. For each Term of the Buffer Strategy, the Buffer is 10%. In addition to the Daily Charge, the decrease for the Term will equal the amount, if any, by which the fall in the Index exceeds 10%. For example, if the Index decreases over the Term by 50%, the Buffer limits the change in Strategy value for the Term to -40%, in addition to the Daily Charge. |
| For a Floor Strategy, the Floor is the most negative portion of any fall in the Index for the Term that is taken into account to determine the Strategy value for a Floor Strategy at the end of the Term. The value of a 0% Floor Strategy will not decrease even if there is a negative change in the applicable Index value during a Term. The value of a -10% Floor Strategy will decrease if there is a negative change in the applicable Index value during a Term, but the Strategy value will never decrease by more than -10% for the Term. |
For a Downside Participation Rate Strategy, the Downside Participation Rate is the portion of any fall in the Index over the Term taken into account to determine the Strategy value at the end of the Term. For each Term of each Strategy with a Downside Participation Rate, the Downside Participation Rate is 50%. In addition to the Daily Charge, the decrease for the Term will be only half of the fall in the Index.
Unless you have made a Performance Lock election, any increase in the value of an Indexed Strategy at the end of a Term is based on the value of the underlying Index on the final Market Day of the Term. This means that you may experience negative or flat performance for the Term even though the underlying Index rose throughout some or most of the Term.
Before the end of a Term, unless you have made a Performance Lock election, the value of an Indexed Strategy is the Investment Base increased or decreased by the Daily Value Percentage. The Daily Value Percentage is based on hypothetical options that represent the projected change in the Index over the full Term, and is equal to the Net Option Price, reduced by the Amortized Option Cost and the Trading Cost. The Daily Value Percentage is applied to determine Strategy values when you withdraw funds allocated to an Indexed Strategy or Surrender your Contract before the end of a Term. The Daily Value Percentage is also applied if the Death Benefit or Annuity Payout value are determined before the end of a Term.
You may make a Performance Lock election for an S&P 500 Indexed Strategy or for a First Trust Barclays Edge Indexed Strategy for a Term that starts after the date of this prospectus. If you make a Performance Lock election, the Strategy value is determined based on the Daily Value Percentage locked at the second Market Close following receipt of your election. Thereafter, that locked Daily Value Percentage will apply to determine the Strategy value on each subsequent day of the Term, including the value at the end of the Term. A Performance Lock election does not affect the Investment Base, so the Indexed Strategy value will still change if the Investment Base is reduced by a withdrawal. Note: A Performance Lock election is not available for Contracts issued in Missouri.
An Indexed Strategy includes a risk of potential loss, which may include both your original principal and prior earnings. This potential loss will exceed any decrease resulting from a fall in an Index because (i) the Daily Charge will reduce the Investment Base upon which Strategy values are based, (ii) the decline in the Daily Value Percentage during a Term may exceed the fall in the Index, and (iii) a withdrawal or Surrender may be subject to an Early Withdrawal Charges. For withdrawals before the end of a Term or if a Performance Lock election is made, the potential loss may exceed the Floor, the Downside Participation Rate, or may not receive the full protection of the Buffer, because the Daily Value Percentage during a Term is not directly limited by the Floor, Downside Participation Rate, or Buffer. These same factors could cause you to realize losses even when the Index rises. For example, you will lose value if the amount of increase attributable to an Index rise is smaller than the amount needed to offset the Daily Charge or Early Withdrawal Charge.
Availability of Indexed Strategies. The S&P 500 6-year 10% Buffer with Upside Participation Rate Strategy is only available for Terms that begin in the first Contract Year and cannot be renewed at the end of the 6-year Term. The S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate Indexed Strategy will always be available. At the end of a Term, we may eliminate any other Indexed Strategy other than the S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate Indexed Strategy in our discretion. We have the right to replace the Index associated with an Indexed Strategy under certain circumstances. A reduction in the number of available Indexed Strategies or a replacement of an underlying Index could materially limit the growth potential of your investment in this Contract. In the future, we may offer new Indexed Strategies with Downside Participation Rates that are greater than 50%, Buffers that are lower than 10% or Floors that are more negative. An allocation of funds to an Indexed Strategy with a higher Downside Participation Rate, a lower Buffer, or a more negative Floor could materially increase the loss potential related to this Contract.
2
Early Withdrawal Charge. The Contract is intended for long-term investment purposes and may not be appropriate for investors who plan to take withdrawals (including systematic withdrawals and required minimum distributions) during the first six Contract Years. During the first six Contract Years, an Early Withdrawal Charge applies if you Surrender your Contract. It also applies to any withdrawal in excess of the Free Withdrawal Allowance, including automatic withdrawals and withdrawals taken to satisfy a required distribution. The early withdrawal charge is 9% for withdrawals and Surrenders of the Contract in the first Contract Year, and falls each Contract Year during the six-year period. Withdrawals and Surrenders may also be subject to income tax, and withdrawals and Surrenders before age 591/2 may also be subject to an additional 10% penalty tax.
Risk Factors for this Contract appear on pages [ ] and pages [ ]. Indexed annuity contracts are complex insurance and investment vehicles. You should speak with a financial advisor about the Index Summit 6 Pro annuity and its features, benefits, risks, and charges, and whether the Contract is appropriate for you based upon your financial situation and objectives.
Please read this prospectus before investing and keep it for future reference. It contains important information about your Contract and MassMutual Ascend Life that you ought to know before investing. It describes all material rights and obligations under the Contract. The provisions of the Contract may vary from state to state. All material state variations are identified in the State Variations section of this prospectus.
All guarantees under the Contract are the obligations of MassMutual Ascend Life and are subject to the credit worthiness and claims-paying ability of MassMutual Ascend Life.
****************************************
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED THESE SECURITIES OR PASSED UPON THE ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
| The Contract is not insured by the FDIC (Federal Deposit Insurance Corporation) or the NCUSIF (National Credit Union Share Insurance Fund). |
| Although the Contract may be sold through relationships with banks or other financial institutions, the Contract is not a deposit or obligation of, or guaranteed by, such institutions or any federal regulatory agency. |
The Contract doesnt invest in any equity, debt, or other investments.
****************************************
The principal underwriter of the Contract is MM Ascend Life Investor Services, LLC. The offering of the Contract is intended to be continuous. The underwriter will use its best efforts to sell the Contract.
This prospectus is not an offering in any state, country, or jurisdiction in which we are not authorized to sell the Contract.
If you purchase a Contract, you may cancel it within 20 days after you receive it. If you purchase a Contract to replace an existing annuity contract or insurance policy, you have 30 days to cancel the Contract. The right to cancel period may be longer in some states. In most states, you will bear the risk of any decreases in Indexed Strategy values before cancellation. The right to cancel is described more fully in the Right to Cancel section of this prospectus.
3
5 | ||||
5 | ||||
8 | ||||
9 | ||||
15 | ||||
21 | ||||
28 | ||||
33 | ||||
35 | ||||
38 | ||||
43 | ||||
46 | ||||
47 | ||||
48 | ||||
49 | ||||
50 | ||||
51 | ||||
51 | ||||
52 | ||||
54 | ||||
56 | ||||
58 | ||||
60 | ||||
60 | ||||
60 | ||||
61 | ||||
61 | ||||
62 | ||||
62 | ||||
63 | ||||
64 | ||||
67 | ||||
67 | ||||
68 | ||||
69 | ||||
69 | ||||
69 | ||||
70 | ||||
72 | ||||
106 | ||||
110 |
4
SECTION I
INDEX SUMMIT 6 PRO ANNUITY INFORMATION
In this prospectus, the following capitalized terms have the meanings set out below.
ACCOUNT VALUE. For each day, the Account Value is the sum of the current values of each Indexed Strategy, plus the current value of the Purchase Payment Account, if any.
ANNUITANT. The natural person or persons on whose life the Annuity Payout Benefit is based.
ANNUITY PAYOUT BENEFIT. A series of periodic payments made under a Payout Option. The terms and conditions are described in the Annuity Payout Benefit section of this prospectus.
ANNUITY PAYOUT INITIATION DATE. The first day of the first payment interval for which payment of an Annuity Payout Benefit is to be made. This is the date we apply your Account Value to the Annuity Payout Benefit and calculate the payment amount.
BENEFICIARY. A person entitled to receive all or part of a Death Benefit that is to be paid under the Contract on account of a death before the Annuity Payout Initiation Date.
BUFFER. For an Indexed Strategy with a Buffer (a Buffer Strategy), the Buffer is the decrease in the value of an Index for a Term that is disregarded when determining the Loss for the Term. The Buffer is also used in the calculation of the Daily Value Percentage before the end of the Term. For each Term of the Buffer Strategy that we currently offer with this Contract, the Buffer is 10%. In the future, we may offer a new Strategy with a Buffer that is more or less than 10%.
CAP. For an Indexed Strategy with a Cap (a Cap Strategy), the Cap is the largest rise in the Index over the Term that is taken into account to determine the Strategy value at the end of the Term. The Cap is also used in the calculation of the Daily Value Percentage for that Strategy before the end of the Term. We post on our website (www.massmutualascend.com/RILArates) the Cap for each Term of a Cap Strategy at least 10 days before the next Term starts. For a given Term, we may set a different Cap for amounts attributable to Purchase Payments received on different dates.
CONTRACT. The annuity contract that is a legally binding agreement between you and MassMutual Ascend Life, including applicable endorsements and riders.
CONTRACT ANNIVERSARY. The date in each year that is the annual anniversary of the Contract Effective Date. That date is set out on your Contract Specifications Page.
CONTRACT EFFECTIVE DATE. The date as of which the initial Purchase Payment is applied to the Contract. That date is set out on your Contract Specifications Page.
CONTRACT SPECIFICATIONS PAGE. The page in your Contract that contains details unique to your Contract.
CONTRACT YEAR. A 12-month period that starts on the Contract Effective Date or on a Contract Anniversary.
DAILY CHARGE. The charge for maintaining your Contract. It is a daily rate that compounds at 0.75% per year. It is calculated daily as a percentage of, and is subtracted from, the then remaining investment base of each Indexed Strategy.
DAILY VALUE PERCENTAGE. The Daily Value Percentage is used to determine the value of an Indexed Strategy before the end of a Term. For each day of a Term of an Indexed Strategy before the final Market Day of the Term, the Daily Value Percentage is equal to: (1) the Net Option Price for that day; minus (2) the Amortized Option Cost for that day; and minus (3) the Trading Cost for that day.
See the next section (Special Terms Related to Daily Value Percentage) for the definitions of Amortized Option Cost, Net Option Price, and Trading Cost.
DEATH BENEFIT. An amount that becomes payable if you die before the Annuity Payout Initiation Date and before the date that the Contract is Surrendered. The terms and conditions are described in the Death Benefit section of this prospectus.
5
DOWNSIDE PARTICIPATION RATE. For an Indexed Strategy with a Downside Participation Rate (a Downside Participation Rate Strategy), the Downside Participation Rate is your share of any fall in the Index over a Term taken into account to determine the Strategy value at the end of the Term. The Downside Participation Rate is also used in the calculation of the Daily Value Percentage before the end of the Term. For every Term of each Strategy other than the Buffer Strategy that we currently offer with this Contract, the Downside Participation Rate is 50%. In the future, we may offer a new Strategy with a Downside Participation Rate that is more or less than 50%.
EARLY WITHDRAWAL CHARGE. A charge deducted from the Account Value of your Contract if, during the first six Contract Years, you Surrender your Contract or you take a withdrawal in excess of the Free Withdrawal Allowance (including systematic withdrawals and required minimum distributions). The Early Withdrawal Charge does not apply to a withdrawal that qualifies for the Free Withdrawal Allowance or the amount, if any, that qualifies for another waiver. The Early Withdrawal Charge does not apply to an Annuity Payout Benefit or Death Benefit.
FLOOR. For an Indexed Strategy with a Floor (a Floor Strategy), the Floor is the decrease in the value of an Index for a Term that is taken into account when determining the Loss for the Term. The Floor is also used in the calculation of the Daily Value Percentage before the end of the Term. For each Term of a Floor Strategy that we currently offer with this Contract, the Floor is -10% or 0%. In the future, we may offer a new Strategy with a Floor that is more or less negative than -10%
FREE WITHDRAWAL ALLOWANCE. The total amount that may be taken as a withdrawal or Surrendered during a Contract Year without an Early Withdrawal Charge that might otherwise apply. This amount is described in the Free Withdrawal Allowance section of this prospectus.
INDEX. A stock market index or an exchange-traded fund (ETF) used to calculate the value of an Indexed Strategy. The Index at the start of a Term is its level or price at the last Market Close on or before the first day of that Term. The Index at the end of a Term is its level or price at the final Market Close of that Term.
INDEXED STRATEGY. A specified method by which values are calculated for a Term. Each Indexed Strategy provides a return based, in part, on changes in the level or price of an Index over a Term. The Indexed Strategies that are currently available are set out on the first page of this prospectus.
INVESTMENT BASE. The base amount used to calculate the value of an Indexed Strategy. The Investment Base is the amount applied to an Indexed Strategy at the start of a current Term, adjusted proportionally for any withdrawal during the Term and any related Early Withdrawal Charge. The Investment Base is reduced daily by an amount equal to the Daily Charge.
MARKET CLOSE. The close of the regular or core trading session on the market used to measure a given Index.
MARKET DAY. Each day that all markets that are used to measure the available Indexes are open for regular trading.
MASSMUTUAL ASCEND LIFE (WE, US, OUR, MMALIC). MassMutual Ascend Life Insurance Company.
OWNER (YOU, YOURS). The person(s) who possesses the ownership rights under the Contract. If there is more than one Owner, each Owner will be a joint owner of the Contract and each reference to Owner means joint owners.
PAYOUT OPTION. The form in which an Annuity Payout Benefit or a Death Benefit may be paid. Standard options are described in the Payout Options section of this prospectus.
PERFORMANCE LOCK. An election to lock in the Daily Value Percentage for the remainder of a Term of an Indexed Strategy. A Performance Lock election for a Term is effective on the second Market Close following our receipt of your Request in Good Order. After the second Market Close, the Indexed Strategy value before the end of the Term and the Indexed Strategy Value at the end of the Term is based on the Daily Value Percentage as determined for that second Market Close. This means that the Net Option Value, Amortized Option Cost, and Trading Cost as of that second Market Close will apply from that date on through the end of the Term. Note: A Performance Lock election is not available for Contracts issued in Missouri.
PURCHASE PAYMENT. An amount received by us for the Contract. This amount is determined after deducting any taxes withheld from the payment and after deducting any fee charged by the person remitting payment.
PURCHASE PAYMENT ACCOUNT. An account where a Purchase Payment is held until it is applied to an Indexed Strategy on a Strategy Application Date.
REQUEST IN GOOD ORDER. An election or a request that is:
| complete and satisfactory to us; |
| sent to us on our form or in a manner satisfactory to us, which may, at our discretion, be by telephone or electronic means; and |
| received at our administrative office. |
6
An election or a request is complete and satisfactory when we have received: (1) all the information and legal documentation that we require to process the election or the request; and (2) instructions that are sufficiently clear that we do not need to exercise any discretion to process the election or the request. If you have any questions, you should contact us or your registered representative before submitting your election or your request.
STRATEGY APPLICATION DATE. The 6th and 20th days of each month.
SURRENDER. The termination of your Contract in exchange for its Surrender Value.
SURRENDER VALUE. For each day, the Surrender Value is the Account Value on that day minus the Early Withdrawal Charge that would apply on a Surrender of the Contract. The Account Value will reflect the applicable Strategy values as calculated on that day, which will reflect the Daily Value Percentage whenever Surrender Value is measured before the end of a Term.
TAX-QUALIFIED CONTRACT. An annuity contract that is intended to qualify for special tax treatment for retirement savings. If your Contract is a Tax-Qualified Contract, the cover page of your Contract includes information about its tax qualification. If your Contract is not a Tax-Qualified Contract, the cover page of your Contract will identify it as a Nonqualified Annuity.
TERM. The period for which Contract values are allocated to a given Indexed Strategy, and over which values are calculated. Terms are one year long, two years long, or six years long. Each Term will start and end on a Strategy Application Date. A new Term will start on the date that the preceding Term ends.
UPSIDE PARTICIPATION RATE. For an Indexed Strategy with an Upside Participation Rate (an Upside Participation Rate Strategy), the Upside Participation Rate is your share of any rise in the Index over a Term taken into account to determine the Strategy value at the end of the Term. The Upside Participation Rate is also used in the calculation of the Daily Value Percentage before the end of the Term. We post on our website (www.massmutualascend.com/RILArates) the Upside Participation Rate for each Term of an Upside Participation Rate Strategy at least 10 days before the next Term starts. For a given Term, we may set a different Upside Participation Rate for amounts attributable to Purchase Payments received on different dates.
7
SPECIAL TERMS RELATED TO DAILY VALUE PERCENTAGE
AMORTIZED OPTION COST. The Amortized Option Cost is one part of the Daily Value Percentage used to determine the value of an Indexed Strategy each day before the final Market Day of a Term. The Amortized Cost for a day is calculated for the last Market Close on or before that day. The Amortized Option Cost is a percentage equal to: (1) the initial Net Option Price for an Indexed Strategy for the Term; multiplied by (2) the number of days remaining until the final Market Close of that Term divided by 365 days if that Term is one year long, or by 730 days if that Term is two years long, or by 2,192 days if that Term is six years long. The initial Net Option Price is the Net Option Price calculated for the last Market Close on or before the start of the Term.
NET OPTION PRICE. The Net Option Price is one part of the Daily Value Percentage used to determine the value of an Indexed Strategy before the final Market Day of a Term. The Net Option Price for a day is calculated for the last Market Close on or before that day.
| For strategies with a Cap and a Downside Participation Rate, the Net Option Price as of a Market Close is equal to: (1) the ATM Call Option Price calculated for that Market Close; minus (2) the OTM Call Option Price calculated for that Market Close; and minus (3) the ATM Put Option Price calculated for that Market Close multiplied by the Downside Participation Rate. |
| For strategies with an Upside Participation Rate and a Downside Participation Rate, the Net Option Price as of a Market Close is equal to: (1) the ATM Call Option Price calculated for that Market Close multiplied by the Upside Participation Rate; minus (2) the ATM Put Option Price calculated for that Market Close multiplied by the Downside Participation Rate. |
| For strategies with an Upside Participation Rate and a Buffer, the Net Option Price as of a Market Close is equal to: (1) the ATM Call Option Price calculated for that Market Close multiplied by the Upside Participation Rate; minus (2) the OTM Put Option Price calculated for that Market Close. |
| For Floor Strategies, the Net Option Price as of a Market Close is equal to: (1) the ATM Call Option Price calculated for that Market Close; minus (2) the OTM Call Option Price calculated for that Market Close; minus (3) the ATM Put Option Price calculated for that Market Close; and plus (4) the OTM Put Option Price calculated for that Market Close. |
| For strategies with a Cap and a Buffer, the Net Option Price as of a Market Close is equal to: (1) the ATM Call Option Price calculated for that Market Close; minus (2) the OTM Call Option Price calculated for that Market Close; and minus (3) the OTM Put Option Price calculated for that Market Close. |
The option prices in these formulas reflect the possible future change in the Index over the remainder of the Term. The formulas take into account the Cap or the Upside Participation Rate for the Term and the Downside Participation Rate, the Buffer or the Floor.
Each option price is stated as a percentage of the Index calculated for the last Market Close on or before the first day of the Term. The option price is an average of the bid-ask prices calculated for the hypothetical option.
ATM CALL OPTION PRICE. The calculated price of a hypothetical at-the-money call option. The hypothetical at-the-money call option is one that will pay the holder an amount equal to the percentage rise, if any, in the Index from the last Market Close on or before the start of a Term to the final Market Close of that Term.
ATM PUT OPTION PRICE. The calculated price of a hypothetical at-the-money put option. The hypothetical at-the-money put option is one that will pay the holder an amount equal to the percentage fall, if any, in the Index from the last Market Close on or before the start of a Term to the final Market Close of that Term.
OTM CALL OPTION PRICE. The calculated price of a hypothetical out-of-the-money call option. The hypothetical out-of-the-money call option is one that will pay the holder an amount equal to the percentage rise, if any, in the Index from the last Market Close on or before the start of a Term to the final Market Close of that Term, but only if and to the extent that rise exceeds the Cap for that Term.
OTM PUT OPTION PRICE. The calculated price of a hypothetical out-of-the-money put option. The hypothetical out-of-the-money put option is one that will pay the holder an amount equal to the percentage decrease, if any, in the Index from the last Market Close on or before the start of the Term to the final Market Close of the Term, but only to the extent the percentage decrease exceeds the Buffer for the Term.
TRADING COST. The Trading Cost is one part of the Daily Value Percentage used to determine the value of an Indexed Strategy each day before the final Market Day of a Term. The Trading Cost is the estimated cost of selling the hypothetical options before the end of a Term. The Trading Cost for a day is a percentage set by us by the last Market Close on or before that day. The Trading Cost reflects the average market difference between option bid-ask average prices and option bid prices.
8
The MassMutual Ascend Life Index Summit 6 Pro annuity is an individual deferred indexed annuity contract that may help you accumulate retirement savings. The Contract is intended for long-term investment purposes. The Contract is a legal agreement between you as the Owner and MassMutual Ascend Life as the issuing insurance company. In the Contract, you agree to make one or more Purchase Payments to us and we agree to pay the Annuity Payout Benefit to you. We also agree to provide a Death Benefit that will never be less than the return of premium guarantee.
Like all deferred annuities, the Contract has two periods. During the period prior to the Annuity Payout Initiation Date, your Contract may accumulate earnings on a tax-deferred basis. During the period that begins on the Annuity Payout Initiation Date, we will make payments under the selected Payout Option.
The key features of the Contract are described in this Summary. Read this entire prospectus for more detailed information about the Contract.
Benefits (See Cash Benefit, Annuity Payout Benefit, and Death Benefit sections on page [ ] and [ ] for more details)
| The Annuity Payout Benefit is a series of periodic payments made under a Payout Option. This benefit can provide you with income for a fixed period of time or for life. It is based on the Account Value on the Annuity Payout Initiation Date. |
| The Cash Benefit lets you take out all of your Account Value (Surrender) or take out part of it (withdrawal). An Early Withdrawal Charge generally applies if you take money out during the first six Contract Years. You can Surrender your Contract or take a withdrawal before the Annuity Payout Initiation Date. |
| The Death Benefit is payable if you die before the Annuity Payout Initiation Date. This benefit is paid to your beneficiaries. It is based on the Death Benefit value. It will never be less than the Return of Premium Guarantee, which will be equal to your Purchase Payments, reduced proportionally for withdrawals, but not including amounts deducted for Early Withdrawal Charges. The Return of Premium Guarantee is not reduced by Daily Charges. |
Purchase Payments and Issue Age (See Purchase section on page [ ] for more details)
The Contract is a modified single premium annuity. This means we will accept Purchase Payments only during the purchase payment period, which ends two months after the Contract Effective Date.
The initial Purchase Payment must be at least $25,000. Each additional Purchase Payment must be at least $10,000. You will need our prior approval if you want to make a Purchase Payment(s) of more than $1,000,000.
Each Owner must be age 80 or younger on the Contract Effective Date.
Indexed Strategies (See Indexed Strategies section on page [ ] for more details)
For this Contract, we currently offer fifteen Indexed Strategies. Each of these Indexed Strategies uses one of five Indexes: S&P 500® Index, iShares® MSCI EAFE ETF, iShares® U.S. Real Estate ETF, SPDR Gold Shares ETF, and Fist Trust Barclays Edge Index. Twelve of these Indexed Strategies have one-year Terms, two have two-year Terms, and one has a six-year Term.
Strategy |
Index | Term | Negative Return Factor |
Positive Return Factor | ||||
S&P 500 1-year 50% Downside Participation Rate with Cap |
S&P 500® | 1-year | 50% Downside Participation Rate |
Cap | ||||
S&P 500 2-year 50% Downside Participation Rate with Cap |
S&P 500® | 2-year | 50% Downside Participation Rate |
Cap | ||||
S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate |
S&P 500® | 1-year | 50% Downside Participation Rate |
Upside Participation Rate | ||||
S&P 500 2-year 50% Downside Participation Rate with Upside Participation Rate |
S&P 500® | 2-year | 50% Downside Participation Rate |
Upside Participation Rate | ||||
S&P 500 6-year 10% Buffer with Upside Participation Rate |
S&P 500® | 6-year | 10% Buffer | Upside Participation Rate | ||||
S&P 500 1-year 10% Buffer with Cap |
S&P 500® | 1-year | 10% Buffer | Cap | ||||
S&P 500 1-year -10% Floor with Cap |
S&P 500® | 1-year | -10% Floor | Cap | ||||
S&P 500 1-year 0% Floor with Cap* |
S&P 500® | 1-year | 0% Floor | Cap | ||||
iShares MSCI EAFE ETF 1-year 50% Downside Participation Rate with Upside Participation Rate |
MSCI EAFE ETF | 1-year | 50% Downside Participation Rate |
Upside Participation Rate | ||||
iShares MSCI EAFE ETF 1-year -10% Floor with Cap |
MSCI EAFE ETF | 1-year | -10% Floor | Cap |
9
iShares U.S. Real Estate ETF 1-year 50% Downside Participation Rate with Upside Participation Rate |
U.S. Real Estate ETF |
1-year | 50% Downside Participation Rate |
Upside Participation Rate | ||||
iShares U.S. Real Estate ETF 1-year -10% Floor with Cap |
U.S. Real Estate ETF |
1-year | -10% Floor | Cap | ||||
SPDR Gold Shares ETF 1-year -10% Floor with Cap |
SPDR Gold Shares ETF |
1-year | -10% Floor | Cap | ||||
First Trust Barclays Edge 1-year 50% Downside Participation Rate with Upside Participation Rate* |
First Trust Barclays Edge |
1-year | 50% Downside Participation Rate |
Upside Participation Rate | ||||
First Trust Barclays Edge 1-year 10% Buffer with Upside Participation Rate* |
First Trust Barclays Edge |
1-year | 10% Buffer | Upside Participation Rate |
* | The S&P 500 1-year 0% Floor with Cap Strategy and the First Trust Barclays Edge Strategies are not available for Contracts issued in Missouri. |
Contractowners who purchased the Contract before May 1, 2023, may have allocated funds to two additional Indexed Strategies. These two Indexed Strategies have been discontinued. They are not available for new or existing contractowners for any new Term that begins after May 1, 2023:
Discontinued Strategy | Index | Term | Negative Return Factor |
Positive Return Factor | ||||
iShares MSCI EAFE ETF 2-year Term with Participation Rate |
MSCI EAFE ETF | 2-year | 50% Downside Participation Rate |
Upside Participation Rate | ||||
iShares U.S. Real Estate ETF 2-year Term with Participation Rate |
U.S. Real Estate ETF |
2-year | 50% Downside Participation Rate |
Upside Participation Rate |
For existing contractowners, at the end of the current Term, any funds in one of these discontinued Indexed Strategies will be transferred to the 1-year 50% Downside Participation Rate with Upside Participation Rate Indexed Strategy that uses the same Index unless the contractowner elects otherwise.
For any Indexed Strategy with a Cap, the Cap will never be lower than 1%. For any Indexed Strategy with an Upside Participation Rate, the Upside Participation Rate will never be lower than 5%.
The Contract doesnt invest in any equity, debt, or other investments. If you buy this Contract, you arent investing directly in an Index, in the stocks included in S&P 500 Index, in the stocks and bonds of the First Trust Barclays Edge Index, in the securities or other assets held by an iShares ETF or SPDR ETF, in any underlying index tracked by an iShares ETF or SPDR ETF, or in the securities or other assets held by such underlying index. All benefits and guarantees under the Contract are the obligations of MassMutual Ascend Life and are subject to the credit worthiness and claims-paying ability of MassMutual Ascend Life.
Indexed Strategy Value (See Indexed Strategy Value at End of Term and Indexed Strategy Value Before End of Term sections below for more details)
The value of an Indexed Strategy changes from day to day throughout each Term. The method used to calculate the Strategy value depends on whether the value is being calculated at the end of a Term or during a Term, and whether a Performance Lock election has been made.
| Once the last Market Day of the Term has been reached, unless a Performance Lock election has been made, the value of an Indexed Strategy is equal to the remaining Investment Base increased for any rise in the applicable Index over that Term or decreased for any fall in the applicable Index over that Term. Any increase for the Term is limited by the Cap or Upside Participation Rate for the Term. Any decrease for the Term is limited by the Downside Participation Rate, Floor, or Buffer. |
| On each day before the last Market Day of the Term, unless a Performance Lock election has been made, the value of an Indexed Strategy is equal to the remaining Investment Base increased or decreased by the Daily Value Percentage as of the most recent Market Close. |
| If a Performance Lock election has been made, then starting with the second Market Close following receipt of the election and continuing through the end of the Term, the value of the Indexed Strategy is equal to the remaining Investment Base increased or decreased by the Daily Value Percentage locked as of that second Market Close. Note: A Performance Lock election is not available for Contracts issued in Missouri. |
A withdrawal reduces the Strategy value by the amount of the withdrawal and any related Early Withdrawal Charge.
10
Investment Base (See Indexed Strategies section on page [ ] for more details)
The value of an Indexed Strategy is calculated using the Investment Base. The Investment Base is not your Strategy Value, Account Value, Surrender Value, Annuity Payout value, or Death Benefit value, but it is used to calculate those values.
At the start of a Term, the Investment Base of an Indexed Strategy is equal to the amount applied to that Strategy for that Term. The Investment Base decreases each day during a Term by the amount of the Daily Charge.
In addition, a withdrawal reduces the Investment Base by the amount that is proportional to the reduction in the Strategy value on account of the withdrawal and any related Early Withdrawal Charge. For example, if a withdrawal and the related Early Withdrawal Charge are equal to 35% of the Strategy value, then the Investment Base for that Strategy will be reduced by 35%.
This means the dollar amount of the proportional reduction in the Investment Base will not be the same as the dollar amount of the withdrawal and the Early Withdrawal Charge.
| If the Strategy value immediately before the withdrawal is greater than the Investment Base, then the proportional reduction in the Investment Base will be less than the withdrawal and the related Early Withdrawal Charge. |
| If the Strategy value immediately before the withdrawal is less than the Investment Base, then the proportional reduction in the Investment Base will be greater than the withdrawal and the related Early Withdrawal Charge. |
Daily Charge (See Daily Charge section on page [ ] for more details)
The Investment Base is reduced daily by an amount equal to the Daily Charge. The Daily Charge is calculated using a daily rate that compounds at 0.75% per year. The Daily Charge applies whether or not you have made a Performance Lock election.
For an Indexed Strategy, it is calculated as a percentage of the remaining Investment Base and deducted daily.
At the end of a one-year Term during which no withdrawals were made, the Daily Charges through the Term End Date are equal to the Investment Base on the Term Start Date times the annual rate at which the Daily Charge compounds.
Example. At the beginning of a Term, you allocate $100,000 to an Indexed Strategy. You do not take any withdrawals during that Term. Over the course of the Term, the Daily Charge amounts to $750 ($100,000 Investment Base times 0.75% Daily Charge Rate), which reduces the Investment Base at the end of the Term to $99,250.
Before the end of a Term, the Daily Charge is the Investment Base from the prior day, multiplied by the Daily Charge rate. If no withdrawals are made during the Term, the sum of the Daily Charges from the first day of the Term to any day during the Term is equal to: Investment Base on the Term Start Date (Investment Base on the Term Start Date x (1 Daily Charge Rate) ^ number of days elapsed prior to withdrawal).
Examples. At the beginning of a Term, you allocate $100,000 to an Indexed Strategy. You do not take any withdrawals during that Term.
On Day 73 of the Term | On Day 219 of the Term | |||||||
Investment Base Calculation |
||||||||
Initial Investment Base |
$100,000 | $100,000 | ||||||
Accumulated Daily Charges |
|
$150 = ($100,000 - ($100,000 x (1 - 0.0000206251) ^ 73) |
|
|
$451 = ($100,000 - ($100,000 x (1 - 0.0000206251) ^ 219) |
| ||
Investment Base After Daily Charges |
|
$99,850 = ($100,000 - $150) |
|
|
$99,549 = ($100,000 - $451) |
|
Indexed Strategy Value at End of Term (See Indexed Strategy Value at End of Term section on page [ ] for more details)
At the end of a Term, unless a Performance Lock election has been made, the value of an Indexed Strategy is equal to the remaining Investment Base increased for any rise in the Index or decreased for any fall in the Index over the Term. If you have made a Performance Lock election, then the normal rules set out here do not apply, and the value at the end of a Term is determined as described under Performance Lock below.
Any increase for the Term is potentially limited by a Cap or limited by an Upside Participation Rate. The Cap for a Term is the largest rise in the Index over the Term taken into account to determine the Strategy value at the end of the Term. For example, if the Cap is 10% and the Index increases over the Term by 16%, the Cap limits the increase in Strategy value for the Term to 10%. The Upside Participation Rate for a Term is the portion of any rise in the Index over the Term that is taken into account to determine the Strategy value at the end of the Term. For example, if the Upside Participation Rate is 50% and the Index increases over the Term by 16%, the Upside Participation Rate limits the increase in Strategy value for the Term to 8%.
11
Any decrease for a Term is limited by a Downside Participation Rate, Floor, or a Buffer. The Downside Participation Rate is the portion of any fall in the Index over the Term taken into account to determine the Strategy value at the end of the Term. For example, if the Downside Participation Rate is 50% and the Index decreases over the Term by 20%, the Downside Participation Rate limits the change in Strategy value for the Term to -10%. The Floor is the portion of any fall in the Index for the Term that is taken into account to determine the Strategy value for a Strategy at the end of the Term. For example, if the Floor is -10% and the Index decreases over the Term by 20%, the Floor limits the change in Strategy value for the Term to -10%. The Buffer is the portion of any fall in the Index over the Term that is disregarded to determine the Strategy value for a Strategy at the end of the Term. For example, if the Buffer is 10% and the Index decreases over the Term by 15%, the Buffer limits the change in Strategy value for the Term to -5%. Daily Charges are deducted from the Investment Base before the increase for any rise in the Index or decrease for any fall in the Index is applied.
Examples. At the beginning of a Term, you allocate $100,000 to an Indexed Strategy. You do not take any withdrawals during that Term. Changes in the Index over a Term would have the following impact on Strategy Values at the Term End, depending on the Cap or Upside Participation Rate that applies:
(a) | When the Index rises over a Term, the resulting Strategy Value increase will be smaller than the rise in the Index applied to the initial Investment Base. This is because the Daily Charge reduces the Investment Base before the Index rise is taken into account. (Note: this would not apply if the Upside Participation Rate were to exceed 100% to the extent needed to offset the Daily Charge). |
(b) | When the Index falls over a Term, the resulting Strategy Value decrease will be larger than the fall in the Index applied to the initial Investment Base. This is because the Daily Charge reduces the Investment Base before the Index fall is taken into account. |
We set the Caps and Upside Participation Rates for each Indexed Strategy prior to the start of each Term. This means Caps and Upside Participation Rates may change for each Term. A Cap will never be lower than 1%. An Upside Participation Rate will never be less than 5%. At least 10 days before the next Term starts, we will post the Caps and Upside Participation Rates that will apply to the Indexed Strategies for that next Term on our website (www.massmutualascend.com/RILArates).
Any increase in the value of an Indexed Strategy at the end of a Term is based on the value of the underlying Index on the final Market Day of the Term. This means that you may experience negative or flat performance for the Term even though the underlying Index rose throughout some or most of the Term.
For each Term of each Downside Participation Rate Strategy that we currently offer with this Contact, the Downside Participation Rate is 50%. The Downside Participation Rate for these Indexed Strategies will not change. In a hypothetical worst case scenario where the Index falls by 100% over the Term and the Downside Participation Rate is 50%, then the Strategy value at the end of the Term will be equal to the Investment Base decreased by 50% in addition to the impact of the Daily Charges on the Investment Base.
For each Term of the Floor Strategies that we currently offer with this Contract, the Floor is either -10% or 0%. The Floor for a Floor Strategy will not change. In a hypothetical worst case scenario where the Index falls by 100% for the Term and the Floor is -10%, then the Strategy value at the end of the Term will be equal to the Investment Base decreased by 10% in addition to the impact of the Daily Charges on the Investment Base.
For each Term of each Buffer Strategy that we currently offer with this Contract, the Buffer is 10%. The Buffer for these Indexed Strategies will not change. In a hypothetical worst case scenario where the Index falls by 100% over the Term and the Buffer is 10%, then the Strategy value at the end of the Term will be equal to the Investment Base decreased by 90% in addition to the impact of the Daily Charges on the Investment Base.
Indexed Strategy Value before End of Term (See Indexed Strategy Value Before End of Term section on page [ ] for more details)
Before the end of a Term, unless you have made a Performance Lock election, the value of an Indexed Strategy is equal to the Investment Base increased or decreased by the Daily Value Percentage. If you have made a Performance Lock election, then the normal rules set out here do not apply, and the value before the end of a Term is determined as described under Performance Lock below.
The Daily Value Percentage is intended to determine the value of an Indexed Strategy prior to the end of a Term using option values related to the positive and negative return factors of the Indexed Strategy. The Daily Value Percentage is equal to the Net Option Price, reduced by the Amortized Option Cost and the Trading Cost.
| The Net Option Price is the calculated price of hypothetical options that represent the projected change in the applicable Index over the full Term. The calculated price takes into account the applicable Cap or Upside Participation Rate and the Buffer, Floor, or Downside Participation Rate. |
| The Amortized Option Cost is the calculated price of those options at the start of the Term amortized over the Term. |
| The Trading Cost is the estimated cost of selling those options. It is a percentage set by us by the last Market Close on or before that day. |
12
For example, if the Investment Base for a Strategy is $100,000 and the Daily Value Percentage is 8%, then the value of your Strategy on that day is equal to $108,000 ($100,000 Investment Base, increased by $100,000 x 8%). If the Investment Base for a Strategy is $100,000 and the Daily Value Percentage is -4%, then the value of your Strategy on that day is equal to $96,000 ($100,000 Investment Base, decreased by $100,000 x -4%).
Performance Lock (See Indexed Strategy Value After Performance Lock section on page [ ] for more details)
A Performance Lock is an election to lock in the Daily Value Percentage for the remainder of a Term. You may make a Performance Lock election for a Term by a Request in Good Order. Once we receive your Request in Good Order, a Performance Lock election for a Term cannot be changed or revoked. However, Daily Charges continue to be assessed even after a Performance Lock election. Note: A Performance Lock election is not available for Contracts issued in Missouri.
A Performance Lock election for a Term is effective on the second Market Close following our receipt of your Request in Good Order. After the second Market Close, the Indexed Strategy value before the end of the Term and the Indexed Strategy value at the end of the Term is based on the Daily Value Percentage as determined for that second Market Close. This means that the Net Option Value, Amortized Option Cost, and Trading Cost as of that second Market Close will apply from that date on through the end of the Term.
Performance Lock is only available for an S&P 500 Indexed Strategy or a First Trust Barclays Edge Indexed Strategy.
If you make a Performance Lock election for the S&P 500 6-Year 10% Buffer with Upside Participation Rate Indexed Strategy before the sixth year of the Term, that Term will end on the next anniversary of the Term start date.
You are responsible for deciding whether to elect a Performance Lock and we are not responsible for any losses incurred as a result of your decision whether or not to elect a Performance Lock.
Strategy Renewals and Reallocations (See Strategy Selections at Term End section on page [ ] for more details)
At the end of each Term, you may reallocate the ending values of the Indexed Strategies for that Term among the Strategies.
| If you reallocate, then we will apply the ending values of the Indexed Strategies to a new Term of the Indexed Strategies that you select. |
| If you do not reallocate, then we will apply the ending value of each Indexed Strategy to a new Term of that same Strategy, as long as the same Strategy is available for a new Term. |
| If you do not reallocate and the same Indexed Strategy is not available for a new Term, then we will apply the ending value of that Indexed Strategy to a new Term of the S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy. |
The S&P 500 6-Year 10% Buffer with Upside Participation Rate Strategy is only available for a Term that starts in the first Contract Year. If you do not reallocate, then we will apply the ending value of the S&P 500 6-Year 10% Buffer with Upside Participation Rate Strategy to a new Term of the S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy.
You cannot reallocate your value among Indexed Strategies during a Term. If you elect a Performance Lock, you will not be able to reallocate the locked value until the end of a Term. We will send you written notice at least 30 days before the end of a Term to provide you with the opportunity to make a reallocation. However, you will not know the Cap and Upside Participation Rates applicable to a new Term until 10 days before the end of the current Term. You should consider this information before finalizing your renewal or reallocation decision.
Access to Your Money through Withdrawals (See Cash Benefit section on page [ ] for more details)
You may take a withdrawal from your Contract at any time prior to the Annuity Payout Initiation Date. During the first six Contract Years, an Early Withdrawal Charge will apply unless (a) your withdrawal qualifies for the Free Withdrawal Allowance or (b) the withdrawal qualifies for a waiver (as explained in the Early Withdrawal ChargeEarly Withdrawal Charge Waiver section). A withdrawal from an Indexed Strategy will reduce the Account Value by the amount of the withdrawal, including any taxes and any applicable Early Withdrawal Charge. A withdrawal during a Term will reduce the Investment Base, which is used to calculate subsequent Strategy values for that Term, by an amount that is proportional to the reduction in the Indexed Strategy value due to the withdrawal.
Early Withdrawal Charge (See Early Withdrawal Charge section on page [ ] for more details)
An Early Withdrawal Charge applies during the first six Contract Years if you Surrender your Contract or withdraw an amount in excess of the Free Withdrawal Allowance. The charge is equal to the amount subject to the charge multiplied by the applicable rate set out below.
13
Contract Year |
1 | 2 | 3 | 4 | 5 | 6 | 7+ | |||||||||||||||||||||
Early Withdrawal Charge Rate |
9 | % | 8 | % | 7 | % | 6 | % | 5 | % | 4 | % | 0 | % |
If you take a withdrawal from your Contract, the amount subject to the charge is the amount you withdraw plus any amount needed to pay the Early Withdrawal Charge. If you Surrender your Contract, the amount subject to the charge is your Account Value.
When you request a withdrawal, we will reduce the amount we pay you by the amount of the Early Withdrawal Charge. If you instruct us to pay you the specific withdrawal amount, we will instead reduce your Account Value by both the requested specific withdrawal amount, as well as the amount of the Early Withdrawal Charge. In this case, since you opted not to pay the Early Withdrawal Charge out of your withdrawal proceeds, we treat the Early Withdrawal Charge as an additional requested withdrawal. We will apply the Early Withdrawal Charge to both the specified withdrawal amount, as well as any amounts we withdraw to cover your Early Withdrawal Charges. The Early Withdrawal Charge does not apply to a withdrawal that qualifies for the Free Withdrawal Allowance or the amount, if any, that qualifies for another waiver.
For example, if after using their Free Withdrawal Allowance a contractholder requested that an additional $10,000 be withdrawn from their Account Value when a 9% Early Withdrawal Charge was in effect, a $900 Early Withdrawal Charge would apply (9% of $10,000 withdrawn). The contractholder would receive $9,100 ($10,000 - $900), minus any income tax withholding.
Similarly, if a contractholder instead requested that they receive a net amount of $10,000 from their account in the same circumstances, we would treat the Early Withdrawal Charge amount as an additional requested withdrawal subject to an Early Withdrawal Charge. This means that we will gross up your requested withdrawal to cover applicable Early Withdrawal Charges (and any income tax withholding). If we assume that no income tax withholding applies, the withdrawal would be grossed up to $10,989, calculated by dividing the net amount requested by 1 minus the Early Withdrawal Charge rate ($10,000 / (1 0.09)). The Early Withdrawal Charge would be $989 (9% of the $10,989 withdrawal), and the contractholder would receive $10,000 ($10,989 - $989).
Free Withdrawal Allowance (See Early Withdrawal Charge section on page [ ] for more details)
The Early Withdrawal Charge does not apply to the Free Withdrawal Allowance.
| For the first Contract Year, the Free Withdrawal Allowance is an amount equal to 10% of the total Purchase Payments received by us. |
| For each subsequent Contract Year, the Free Withdrawal Allowance is equal to 10% of the Account Value as of the most recent Contract Anniversary. |
Payout Options (See Payout Options section on page [ ] for more details)
Like all annuity contracts, the Contract offers a range of Payout Options, which provide payments for your lifetime or for a fixed period. After payments begin, you cannot change the Payout Option or any fixed period you selected. The standard Payout Options are listed below.
| Fixed Period Payout |
| Life Payout |
| Life Payout with Payments for at Least a Fixed Period |
| Joint and One-Half Survivor Payout |
Death Benefit (See Death Benefit section on page [ ] for more details)
A Death Benefit is payable under the Contract if you die before the Annuity Payout Initiation Date. If the Owner is a non-natural person, such as a trust or a corporation, then a Death Benefit is payable under the Contract if an Annuitant dies before the Annuity Payout Initiation Date.
The Death Benefit value is the greater of: (1) the Account Value as of the applicable date; or (2) the Return of Premium Guarantee, which will be equal to your Purchase Payment(s) reduced proportionally for all withdrawals, but not including amounts deducted to pay Early Withdrawal Charges. The Return of Premium Guarantee is not reduced by Daily Charges.
Tax Deferral (See Federal Tax Considerations section on page [ ] for more details)
The Contract is generally tax deferred, which means that you are not taxed on the earnings in your Contract until the money is paid to you. Contracts owned by non-natural owners, such as trusts and corporations, are subject to special rules.
A tax-qualified retirement plan such as an IRA also provides tax deferral. Buying the Contract within a tax-qualified retirement plan does not give you any extra tax benefits. There should be reasons other than tax deferral for buying the Contract within a tax-qualified retirement plan.
14
Right to Cancel (See Right to Cancel (Free Look) section on page [ ] for more details)
If you purchase a Contract, you may cancel it within 20 days after you receive it. If you purchase a Contract to replace an existing annuity contract or insurance policy, you have 30 days to cancel the Contract. The right to cancel period may be longer in some states. If you cancel your Contract, you will receive a refund. The amount of the refund will depend on where you live. In some states, the refund amount is equal to the Purchase Payments. In that case, no adjustment will be made for the Daily Value Percentage and no Early Withdrawal Charges will apply to the amount refunded. In other states, the refund amount is equal to the Account Value on the day that we receive a cancellation request. In this case, you would bear the risk of changes in Indexed Strategy values before cancellation because an adjustment will be made for the Daily Value Percentage, but no Early Withdrawal Charges will apply to the amount refunded. Unless required by state law, we do not refund any Daily Charge assessed during the free look period or any Early Withdrawal Charges assessed during the free look period that relate to a withdrawal taken before you cancel the Contract. See the Right to Cancel (Free Look) section for more information about your cancellation rights and the State Variations section of this prospectus for more information about state variations that apply to cancellation rights.
There may be tax consequences if you cancel the Contract. You should seek advice on tax questions based on your particular circumstances from a tax advisor.
The Contract involves certain risks that you should understand before purchasing it. You should carefully consider your income needs and risk tolerance to determine whether the Contract or a particular Indexed Strategy is appropriate for you. The level of risk you bear and your potential investment performance will differ depending on the Indexed Strategies you choose.
Loss of Principal Related to Indexed Strategies
There is a significant risk of loss of principal and prior earnings due to the fall of an Index if you allocate your Purchase Payment(s) to an Indexed Strategy. Such a loss may be substantial. This risk exists because, at the end of that Term, you can lose up to 10% of the money allocated to a -10% Floor Strategy, 90% of the money allocated to a Buffer Strategy or 50% of the money allocated to any other Indexed Strategy. In addition, before the end of a Term, the value of a Strategy may be even less than 50% of the money allocated to that Indexed Strategy with a Downside Participation Rate, or even less than 90% of the money allocated to a -10% Floor Strategy, or even less than 10% for money allocated to the Buffer Strategy because the loss will include a reduction for the Amortized Option Cost and the Trading Cost. If you allocate money to one or more Indexed Strategies over multiple Terms, you may lose money each Term, which may result in a cumulative loss that is greater than 50% for an Indexed Strategy with a Downside Participation Rate, greater than 10% for a -10% Floor Strategy, or greater than 90% for a Buffer Strategy of your Purchase Payment(s).
The S&P 500 1-Year 50% Downside Participation Rate with Upside Participation Rate Indexed Strategy will always be available. At the end of a Term, we may stop offering any other Indexed Strategy. Consequently, any other Indexed Strategy listed in this prospectus may not be available after the end of the initial Term. The S&P 500 6-Year 10% Buffer with Upside Participation Rate Indexed Strategy will only be available for Terms beginning in the first Contract Year. We have the right to replace the Index associated with an Indexed Strategy under certain circumstances.
In the future, we may offer a new Strategy with a Downside Participation Rate that is more or less than 50%, a Floor that is more or less negative than -10%, or with a Buffer of more or less than 10%. The risk of loss of principal will be greater if you allocate money to a Strategy with a higher Downside Participation Rate, more negative Floors or less of a Buffer. In a worst case scenario, if we could eliminate all of the current Indexed Strategies and offer only new Indexed Strategies with higher Downside Participation Rates or lesser Buffers, then your risk of loss of principal would increase.
Loss of Principal Related to Daily Charge
There is a risk of loss of principal and related earnings as a result of the Daily Charge. The Daily Charge reduces your Investment Base, which will result in reduced Strategy values. In addition, any Index increases will not apply to amounts deducted as Daily Charges because Daily Charges are subtracted from the Investment Base prior to calculating Strategy values. The Daily Charge will continue to be assessed against your Investment Base even if you have made a Performance Lock election.
You could realize losses even when the Index rises. This will occur when the amount of increase attributable to an Index rise is smaller than the amount needed to offset the Daily Charge.
For example, if the Investment Base of an Indexed Strategy at the start of a Term is $100,000 and $650 in Daily Charges have been deducted since the start of the Term, the remaining Investment Base will be $99,350 ($100,000 $650). If on that date the Daily Value Percentage is a positive 0.5%, then the Strategy Value on that date will be $99,847 ($99,350 x 100.5%). The Daily Charges exceed the value attributable to the 0.5% increase, resulting in a net reduction in the Strategy Value since the start of the Term. In addition, the 0.5% increase will not apply to the $650 applied to pay the Daily Charges because the Daily Charges are subtracted from the Investment Base before calculating the Strategy value.
When the Index falls, the Daily Charge will cause you to realize losses in excess of the Downside Participation Rate.
15
Loss of Principal Related to Early Withdrawal Charge
There is also a risk of loss of principal and prior earnings if you take a withdrawal from your Contract or Surrender it during the first six Contract Years and an Early Withdrawal Charge applies. This risk exists for each Strategy. An Early Withdrawal Charge will reduce the value of the Strategy. This reduction may exceed any prior earnings.
Long-Term Nature of Contract
The Contract is a deferred annuity, which means the Annuity Payout Benefit will begin on a future date. We designed the Contract to be a long-term investment that you can use to help build a retirement nest egg and provide income for retirement. The limitations, adjustments and charges included in the Contract reflect its long-term nature.
Limits on Strategy Value at End of Term
If the Index rises over the Term and a Cap applies, then the Strategy value at the end of the Term can never be more than the Investment Base increased by the Cap for that Term even if the Index has risen by more than the Cap. If the Index rises over the Term and an Upside Participation Rate applies, then the Strategy value at the end of the Term will be the Investment Base increased by your share of the rise in the Index. Your share of any rise in the Index is equal to the Upside Participation Rate for that Term multiplied by the rise in the Index. Due to these limitations, in many cases the return on money allocated to an Indexed Strategy with a Cap will not fully reflect the corresponding rise in the Index over the Term and the return on money allocated to an Indexed Strategy with an Upside Participation Rate that is less than 100% will never reflect the entire corresponding rise in the Index over the Term.
Index Changes Over the Course of Term
At the end of a Term, unless you have made a Performance Lock election, we measure the Index change by comparing the Index value on the first day of the Term to the Index value on the last day of the Term. This means that if the Index value is lower on the last day of the Term, you may experience negative or flat performance even if the Index rose through some, or most, of the Term.
The Contract offers you the opportunity to allocate funds to Indexed Strategies for one year, two year, or six year Terms. For Indexed Strategies with two-year Terms or six year Terms, changes in Strategy value as a result of Index performance will only be measured over a two year period or a six year period and not annually.
Limits on Strategy Value Before End of Term
Before the end of a Term, we calculate the value of an Indexed Strategy using a Daily Value Percentage that is not tied directly to the underlying Index. The Daily Value Percentage includes the prices of hypothetical options. Such option prices will vary from day to day. You will bear the risk that the Daily Value Percentage may decrease the Strategy value before the end of a Term.
The Daily Value Percentage includes deductions for the Amortized Option Cost and the Trading Cost, which means that any Strategy value before the end of a Term will almost always be less than the value suggested by the rise or fall of the Index. Because the Amortized Option Cost is a decreasing value, its negative impact on Strategy values will be more pronounced at the start of a Term than at the end of that Term. In addition, even if the Index rises, the Strategy value may be less than the Investment Base due to these deductions.
Strategy values are used to calculate the amount payable upon Surrender, applied to the Annuity Payout Benefit, or payable as the Death Benefit. Accordingly, the Amortized Option Cost and Trading Cost will have a negative effect on such benefits taken before the end of a Term.
For more information on how we determine the prices of hypothetical options, see the Option Prices section of this Prospectus.
No Increases in Value After Performance Lock
If you make a Performance Lock election, the Daily Value Percentage will be locked for the balance of the Term. This means that you will experience flat performance through the balance of the Term even if the Net Option Value increases, you will not benefit from the continued decline in the Amortized Option Cost, your Strategy value will continue to be reduced to reflect the Daily Charge, and your ending Strategy value will not be based on the ending Index value on the last day of the Term.
Limits on Reallocations
You cannot reallocate money among the Indexed Strategies prior to the end of a Term. If you want to take money out of an Indexed Strategy during a Term, you must take a withdrawal or Surrender your Contract.
16
Effect of Surrenders
If you Surrender your Contract at any time during the first six Contract Years and an Early Withdrawal Charge applies, the amount payable will reflect a deduction for the charge. If you Surrender your Contract at the end of a Term, the amount payable will reflect any rise or fall of the applicable Indexes over the Term, applicable Caps, Upside Participation Rates, Floors, Buffers and the Downside Participation Rate. If you Surrender your Contract before the end of a Term, the amount payable will reflect the applicable Daily Value Percentage.
Effect of All Withdrawals
If you take a withdrawal at any time, we will reduce your Account Value by an amount equal to your withdrawal. If you take a withdrawal during the first six Contract Years and an Early Withdrawal Charge applies, we will also reduce your Account Value by the amount of the charge. A reduction in the Account Value will reduce the amount payable upon Surrender, applied to the Annuity Payout Benefit, or payable as the Death Benefit. In addition, a withdrawal will proportionally reduce the Return of Premium Guarantee for the Death Benefit.
Each withdrawal from an Indexed Strategy, including withdrawals available under the Free Withdrawal Allowance, withdrawals that qualify for a waiver of the Early Withdrawal Charge, withdrawals under an automatic withdrawal program and withdrawals to satisfy a required distribution, will reduce the Strategy value. If taken from an Indexed Strategy before the end of a Term, the reduction in Strategy value is determined by the Daily Value Percentage on the date of the withdrawal, or on the locked Daily Value Percentage if you have made a Performance Lock election. The reduction in Strategy value may be higher or lower than the Investment Base. Unless you have made a Performance Lock election, the reduction in Strategy value may be higher or lower than the end-of-Term value. The Investment Base used to calculate the Strategy value through the end of that Term will also be reduced. The reduction in the Investment Base for a withdrawal and any related Early Withdrawal Charge is proportional to the reduction in the Strategy value. A reduction in the Investment Base will limit the effect of any rise or fall in the Index for the remainder of the Term.
All or some portion of a withdrawal may be subject to federal and state income taxes and, if taken before age 591/2, may be subject to a 10% federal penalty tax. For a further discussion of the tax treatment of withdrawals and surrenders, please see the Federal Tax Considerations section on page [ ].
Timing and Effect of Withdrawals Before End of Term
You should take into consideration the dates on which the Term(s) of your Indexed Strategies end relative to the timing of a withdrawal.
| If you take a withdrawal from an Indexed Strategy before the end of a Term, we will immediately reduce the Investment Base for that Indexed Strategy. |
| The reduction will be proportional to the reduction in the Strategy Value, which means that the proportional reduction in the Investment Base could be larger than the dollar amount of the withdrawal. |
| Reductions to the Investment Base will have a negative effect on any increases in the Indexed Strategy value for the remainder of that Term, but will reduce any decreases in the Indexed Strategy value for the remainder of that Term. |
| Once the Investment Base for an Indexed Strategy is reduced due to a withdrawal before the end of a Term, it will not increase at any time during the remainder of that Term. |
Each withdrawal from an Indexed Strategy before the end of a Term, including withdrawals available under the Free Withdrawal Allowance, withdrawals that qualify for a waiver of the Early Withdrawal Charge, withdrawals under an automatic withdrawal program and withdrawals to satisfy a required distribution, will proportionally reduce the Investment Base.
No Ability to Determine Contract Values in Advance
We will process any withdrawal request at the first Market Close after receipt of your Request in Good Order. This means you will not be able to determine in advance the amount of the proportional reduction in the Investment Base due to the withdrawal. Likewise, you will not be able to determine in advance the amount payable upon Surrender, to be applied to the Annuity Payout Benefit or payable as the Death Benefit.
A Performance Lock election is effective on the second Market Close after receipt of your Request in Good Order. This means you will not be able to determine in advance the locked Daily Value Percentage that will be applicable to the Indexed Strategy at the time you make a Performance Lock election. The Daily Value Percentage may be higher or lower at the time the Performance Lock election goes effective than it was when you submitted your Request in Good Order. Note: A Performance Lock election is not available for Contracts issued in Missouri.
Changes in Caps, Upside Participation Rates, and Trading Cost
We set a Cap or an Upside Participation Rate for each new Term of an Indexed Strategy. The Cap or Upside Participation Rate for a new Term of an Indexed Strategy may be lower than its Cap or Upside Participation Rate for the current Term. A Cap may be as low as 1%. An Upside Participation Rate may be as low as 5%. You risk the possibility that the Cap or Upside Participation Rate for a new Term may be lower than you would find acceptable.
We may change the Trading Cost at any time due to changes in option prices. You bear the risk of any negative effect on the Daily Value Percentage and Indexed Strategy values of an increase in the Trading Cost.
17
Unavailable Indexed Strategies
At the end of a Term, we may stop offering any Indexed Strategy other than the S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate Indexed Strategy. Consequently, any other Indexed Strategy you selected may not be available after the end of a Term. In such an event, the Company will amend the prospectus. At least 30 days before the end of each Term, we will send you a written notice with information about the Indexed Strategies that will be available for the next Term. If funds are allocated to an Indexed Strategy that will not be available for the next Term and you do not request a reallocation of those funds, then we will apply the ending value of that Indexed Strategy for the next term as follows:
1) | if the Strategy is a Downside Participation Rate Strategy, to another Indexed Strategy that uses the same index as the prior Indexed Strategy, has a Term that is no longer than the prior Indexed Strategy, has a Downside Participation Rate that is no greater than the prior Indexed Strategy, and has the same or most comparable positive return factors; or |
2) | if the Strategy is a Floor Strategy, to another Indexed Strategy that uses the same index as the prior Indexed Strategy, has a Term that is no longer than the prior Indexed Strategy, has a Floor that is no more negative than the prior Indexed Strategy, and has the same or most comparable positive return factors; or |
3) | if the Strategy is a Buffer Strategy, to another Indexed Strategy that uses the same index as the prior Indexed Strategy, has a Term that is no longer than the prior Indexed Strategy, has a Buffer that is at least as large as the prior Indexed Strategy, and has the same or most comparable positive return factors; or |
4) | to the S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate Indexed Strategy. |
We may establish minimum and maximum amounts or percentages that may be applied to a given Indexed Strategy. This means that an Indexed Strategy you selected may not be available after the end of a Term because the amount to be applied to that Strategy is less than the minimum we set for the new Term. Likewise, the amount to be applied to an Indexed Strategy may be limited by the maximum we set for the new Term. At least 30 days before the end of each Term, we will send you a written notice with information about any maximum or minimum that will apply for the next Term. If funds cannot be applied to a Strategy due to the minimum or maximum we set for the next Term and you do not request a reallocation of those funds, we will apply the funds for the new Term in the same manner as if the given Indexed Strategy were no longer offered.
In these cases, the funds that we allocate to the default Strategy may earn a return that is lower than the return those funds would have earned if they had been applied to the Indexed Strategy you selected.
If you choose to Surrender your Contract because a certain Indexed Strategy is no longer available, you may be subject to an Early Withdrawal Charge. There may be tax consequences if you Surrender your Contract. You should seek advice on tax questions based on your particular circumstances from a tax advisor.
The S&P 500 6-year 10% Buffer with Upside Participation Rate Strategy is not available for Terms that begin after the first Contract Year.
Replacement of an Index
We have the right to replace an Index if: it is discontinued: we are no longer able to use it, its calculation changes substantially, or we determine that hedging instruments are difficult to acquire or the cost of hedging becomes excessive. We may do so at the end of a Term or during a Term. If we replace an Index, notice will be provided to contract owners and the Company will amend the prospectus. If we replace an Index during a Term, we will calculate any rise or fall in the Index using the old Index up until the replacement date. After the replacement date, we will calculate any rise or fall in the Index using the new Index. The performance of the new Index may not be as good as the performance of the old Index. As a result, funds allocated to an Indexed Strategy may earn a return that is lower than the return they would have earned if there had been no replacement.
Involuntary Termination of Contract
If your Account Value on any anniversary of the initial Strategy Application Date is below the minimum value of $5,000 for any reason, we may terminate your Contract on that anniversary. If your Contract has Terms that end on the same date because you made only one Purchase Payment, any involuntary termination will occur on that date. If your Contract has Terms that end on different dates because you made more than one Purchase Payment, any involuntary termination will occur on one of those dates, which will be the end of one Term but not the end of the other Terms. In this case, the Surrender Value payable upon termination of your Contract will reflect the Daily Value Percentages used to calculate the values of Indexed Strategies with Terms that are not ending on the termination date.
No Direct Investment in S&P 500 Index
When you allocate money to an Indexed Strategy that uses the S&P 500 Index, you will not be investing in that Index, or in any stock included in that Index. The S&P 500 Index is calculated without taking into account dividends paid on stocks that make up the S&P 500 Index. In addition, because the performance of an S&P 500 Indexed Strategy is linked to the performance of the S&P 500 Index and not the performance of the stocks included in the Index, your return may be less than that of a direct investment in such stocks. In addition, due to the same limitations, your return may be less than that of a direct investment in a fund that tracks the S&P 500 Index.
18
No Direct Investment in an iShares ETF
When you allocate money to an Indexed Strategy that uses the iShares MSCI EAFE ETF or iShares U.S. Real Estate ETF, you will not be investing in that exchange-traded fund, the securities or other assets held by the fund, in any underlying index tracked by the fund, or in the securities or other assets held by such underlying index. In addition, because the performance of an iShares ETF is linked to the performance of the share price of the ETF, which is determined by trading on the exchange, and not the performance of its investment portfolio, its underlying index or the components of that index, your return may be less than that of a direct investment in the securities or other assets held by the fund or a direct investment in the components of the funds underlying index. In addition, due to the same limitations, your return may be less than that of a direct investment in the fund.
No Direct Investment in SPDR Gold Shares ETF
When you allocate money to an Indexed Strategy that uses the SPDR Gold Shares ETF, you will not be investing in that exchange-traded fund or in gold. In addition, because the performance of the SPDR Gold Shares ETF is linked to the performance of the share price of the ETF, which is determined by trading on the exchange, and not the performance of its investment portfolio, its underlying index or the components of that index, your return may be less than that of a direct investment in the securities or other assets held by the fund or a direct investment in the components of the funds underlying index. In addition, due to the same limitations, your return may be less than that of a direct investment in the fund.
No Direct Investment in First Trust Barclays Edge Index
When you allocate money to an Indexed Strategy that uses the First Trust Barclays Edge Index, you will not be investing in that Index, or in any stock or bonds included in that Index. The First Trust Barclays Edge Index is calculated assuming that dividends paid on stocks that make up the First Trust Barclays Edge Index are reinvested. In addition, because the performance of the First Trust Barclays Edge Indexed Strategy is linked to the performance of the First Trust Barclays Edge Index and not the performance of the stocks and bonds included in the Index, your return may be less than that of a direct investment in such stocks and bonds. In addition, due to the same limitations, your return may be less than that of a direct investment in a fund that tracks the First Trust Barclays Edge Index.
Divergence of Performance
The performance of an Indexed Strategy will diverge from the performance of the underlying Index because changes in the value of an Indexed Strategy at the end of a Term are subject to Caps or Upside Participation Rates and the Downside Participation Rate, Floor, or Buffer, and because changes in the value of an Indexed Strategy before the end of a Term are based on the Daily Value Percentage.
Market Risk Related to Indexes
Money allocated to an Indexed Strategy that uses the S&P 500 Index or the First Trust Barclays Edge Index is subject to the risk that the market value of the underlying securities that comprise the S&P 500 Index and the First Trust Barclays Edge Index may decline over a Term. Likewise, money allocated to an Indexed Strategy that uses the iShares MSCI EAFE ETF, the iShares U.S. Real Estate ETF, or the SPDR Gold Shares ETF is subject to the risk that the funds share price may decline over a Term. The level of the S&P 500 Index and the First Trust Barclays Edge Index and the share prices of the SPDR Gold Shares ETF, iShares MSCI EAFE ETF and the iShares U.S. Real Estate ETF may be volatile. Any such market loss in an amount up to the Downside Participation Rate will be reflected in the Indexed Strategy value. For example, with a Downside Participation Rate of 50%, the Indexed Strategy value will be reduced by 50% of a fall in the Index at the end of a Term. This risk applies even if you do not take a withdrawal before the end of a Term. For a Buffer Strategy, the Indexed Strategy value will be reduced by any amount by which the fall in the Index at the end of the Term exceeds the 10% Buffer. For a Floor Strategy with a floor of -10%, the Indexed Strategy value will be reduced at the end of the Term by the fall in the Index, not to exceed -10%. This risk also applies even if you do not take a withdrawal before the end of a Term.
[The outbreak of the novel coronavirus known as COVID-19 has led to significant volatility in the financial markets. These market conditions have impacted the performance of the Indexes to which the Indexed Strategies are linked. If these market conditions continue, and depending on your individual circumstances (e.g., your selected Crediting Strategies and the timing of any Purchase Payments, transfers, or withdrawals), you may experience (perhaps significant) negative returns under the Contract. The future impact that the pandemic may have on the financial markets and global economy, cannot be foreseen, however. You should consult with a Financial Professional about how the COVID-19 pandemic and the recent market conditions may impact your future investment decisions related to the Contract, such as purchasing the Contract or making Purchase Payments, transfers, or withdrawals, based on your individual circumstances.
The Russian/Ukraine conflict and the resulting response by the United States and other countries could create economic disruption, including increased market volatility, and presents economic uncertainty. The full impact and duration of these events are difficult to determine. Any such impact could adversely affect the performance of the securities that comprise the Indexes and may lead to losses on your investment in the Indexed Strategies.]
The historical performance of an Index does not guarantee future results.
19
S&P 500 Index. The S&P 500® Index is designed to reflect the large-cap sector of the U.S. equity market and, due to its composition, it also represents the U.S. equity market in general. Any positive change in the S&P 500 Index over a Term will be lower than the total return on an investment in the stocks that comprise the S&P 500 Index because such total return will reflect dividend payments on those stocks and the S&P 500 Index will not reflect those dividend payments. More information about the S&P 500 Index is set out in the Indexes section of this prospectus.
iShares MSCI EAFE ETF. The iShares MSCI EAFE ETF is an exchange traded fund that seeks to track the investment results of an index composed of large- and mid-capitalization developed market equities, excluding the U.S. and Canada (MSCI EAFE Index). This underlying index includes stocks from Europe, Australasia and the Far East. It may include large- or mid-capitalization companies. The share price of the iShares MSCI EAFE ETF is tied to the performance of large- and mid-capitalization developed market equites, excluding the U.S. and Canada. The share price may not replicate the performance of the fund, its underlying index, or the components of that index. More information about the iShares MSCI EAFE ETF is set out in the Indexes section of this prospectus. To learn more about the iShares MSCI EAFE ETF, visit iShares.com and search ticker symbol EFA.
iShares U.S. Real Estate ETF. The iShares U.S. Real Estate ETF is an exchange traded fund that seeks to track the investment results of an index composed of U.S. equities in the real estate sector (Dow Jones U.S. Real Estate Index). This underlying index may include large-, mid- or small-capitalization companies. A significant portion of the underlying index is represented by real estate investment trusts (REITs), but the components are likely to change over time. The share price of the iShares U.S. Real Estate ETF is tied to the performance of the real estate sector. The share price may not replicate the performance of the fund, its underlying index, or the components of that index. More information about the iShares U.S. Real Estate ETF is set out in the Indexes section of this prospectus. To learn more about the iShares U.S. Real Estate ETF, visit iShares.com and search ticker symbol IYR.
SPDR Gold Shares ETF. The SPDR Gold Shares ETF represents units of beneficial interest in, and ownership of, the SPDR Gold Trust, an exchange traded fund that holds gold bullion. The investment objective of the trust is for the shares to reflect the performance of the price of gold bullion, less the trusts expenses. The shares are designed to mirror as closely as possible the price of gold, and the value of the shares relates directly to the value of the gold held by the trust, less its liabilities. The price of gold has fluctuated widely over the past several years and the shares have experienced significant price fluctuations. The value of the gold held by the trust is determined using the London Bullion Market Association (LBMA) Gold Price PM. The Gold Shares trade on the NYSE Arca under the symbol GLD. For more information, visit www.spdrgoldshares.com.
First Trust Barclays Edge Index. The First Trust Barclays Edge Index is designed to combine capital strength and value equity investment methodologies with a mix of US Treasuries for more consistent returns. The First Trust Barclays Edge Index consists of an equity component that combines stocks from the Capital Strength Index and the Value Line Dividend Index. The Capital Strength Index starts with the largest 500 companies in the NASDAQ US benchmark index and then reduces the selection universe by screening for companies that meet minimum criteria including cash and/or short-term investments on their balance sheets, low debt-to-market cap ratios and attractive return-on-equity. It then selects the top 50 names from this smaller universe based on low historical volatility. The Value Line Dividend Index starts with the universe of stocks published in its The Value Line Investment Survey publication and then selects those with a Value Line Safety Rank of 1 or 2, with attractive dividends and market cap of one billion dollars or above. It then equally weights all stocks that meet those conditions (generally, around 160-200 stocks). The First Trust Barclays Edge Index then combines the stocks represented in The Capital Strength Index and the Value Line Dividend Index. The Index also monitors various market factors to determine if an allocation to 2-year, 5-year and 10-year US Treasuries is warranted with a daily volatility control to target a 7% volatility level per annum.
Market Risk Related to Option Prices
Before the end of a Term, money allocated to an Indexed Strategy is subject to the risk that changes in the related option prices may have a negative effect on the value of the Indexed Strategy. This risk applies only if you take a withdrawal before the end of a Term.
Performance Lock Risk
If you make a Performance Lock election, you will no longer participate in the positive or negative performance of the Index over the remainder of the Term. This means the value of the Indexed Strategy cannot increase for the remainder of the Term, even if the Index rises over the remainder of the Term.
A Performance Lock election is effective on the second Market Close after receipt of your Request in Good Order. This means you will not be able to determine in advance the Gain or Loss applicable to the Indexed Strategy when electing a Performance Lock. The Gain or Loss may be higher or lower at the time the Performance Lock election goes effective than it was when you submitted your Request in Good Order. Note: A Performance Lock election is not available for Contracts issued in Missouri.
Regulatory Risk
MassMutual Ascend Life is not an investment company. Neither MassMutual Ascend Life nor the separate account that we established in connection with the Contracts is registered as an investment company under the Investment Company Act of 1940. The protections provided to investors by that Act are not applicable to the Contract.
20
Reliance on Our Claims-Paying Ability
No company other than MassMutual Ascend Life has any legal responsibility to pay amounts owed under the Contract. You should look to the financial strength of MassMutual Ascend Life for its claims-paying ability.
Our general account assets fund the guarantees provided in the Contracts. The assets are subject to our general business operation liabilities and claims of our creditors and may lose value. We established a non-unitized separate account for the purpose of supporting our obligation to adjust the Indexed Strategy values based on the Daily Value Percentage or rise or fall of the Index. The assets in the non-unitized separate account are not chargeable with liabilities arising out of any other business that we conduct but may lose value. The non-unitized separate account differs from the unitized separate accounts that support our variable annuity contracts. As a result, unlike the owner of a traditional variable annuity who has a beneficial interest in, and participates in the performance of, the assets of the related unitized separate account, you do not have any interest in or claim on the assets in the non-unitized separate account and you will not participate in any way in the performance of assets held in that account.
Various factors, such as those listed below, could materially affect our business, financial condition, cash flows or future results and, in turn, our financial strength and claims-paying ability. A more complete discussion of these factors appears on pages [A6-A10].
| Financial losses including those resulting from the following events: |
| Adverse developments in financial markets and deterioration in global economic conditions |
| Unfavorable interest rate environments |
| Losses on our investment portfolio |
| Loss of market share due to intense competition |
| Ineffectiveness of risk management policies |
| Changes in applicable law and regulations |
| Inability to obtain or collect on reinsurance |
| A downgrade or potential downgrade in our financial strength ratings |
| Variations from actual experience and managements estimates and assumptions that could result in inadequate reserves |
| Significant variations in the amount of capital we must hold to meet statutory capital requirements |
| Legal actions and regulatory proceedings |
| Difficulties with technology or data security |
| Failure to protect confidentiality of customer information |
| Failure to maintain effective and efficient information systems |
| Occurrence of catastrophic events, terrorism or military actions |
[The economic impacts of the COVID-19 pandemic may negatively affect our financial condition and results of operations. The extent to which the COVID-19 pandemic impacts financial markets, the global economy, and our financial strength and claims-paying ability will depend on future developments that cannot be predicted with certainty. We continue to be subject to significant state solvency regulations that require us to reserve amounts to pay our contractual guarantees. Please see Managements Discussion and Analysis of Financial Condition and Results of Operations, Risks Primarily Related to MMALICs Financial Strength and Claims-Paying Ability, and Financial Statements, and Regulation for additional financial information about the company and the state solvency regulations to which we are subject.]
The Indexed Strategies provide returns that are based, in part, upon changes in an Index. The Indexed Strategies do not earn interest at a fixed rate. Unlike a traditional variable annuity, the values of the Indexed Strategies are not based on the investment performance of underlying portfolios.
At the end of a Term, unless you have made a Performance Lock election, any increase in the value of an Indexed Strategy is determined after Daily Charges have been deducted from the Investment Base, and is based on the rise in the applicable Index since the start of that Term and the Cap or Upside Participation Rate for that Term. At the end of a Term, any decrease in the value of an Indexed Strategy is determined after Daily Charges have been deducted from the Investment Base, and is based on the fall in the applicable Index since the start of that Term and the Downside Participation Rate or Buffer.
Before the end of a Term, unless you have made a Performance Lock election, the value of an Indexed Strategy is first decreased by Daily Charges. Then any increase or further decrease in the value of an Indexed Strategy is based on the calculated price of hypothetical options related to the possible future change in the applicable Index over the Term, the initial cost of those options, and the trading cost related to those options. The calculated price of those options takes into account the Cap or the Upside Participation Rate for the Term and the Downside Participation Rate, Floor, or the Buffer.
21
If you have made a Performance Lock election, then beginning at the second Market Close following receipt of your election and continuing through the end of the Term, any increase or decrease in the value of an Indexed Strategy is locked in based on the calculated price of hypothetical options related to the possible future change in the applicable Index over the Term, the initial cost of those options, and the trading cost related to those options, all as determined at that second Market Close. However, the value of the Indexed Strategy will continue to change because of the Daily Charges assessed against the Investment Base. Note: A Performance Lock election is not available for Contracts issued in Missouri.
Each Indexed Strategy has a Cap or an Upside Participation Rate for each Term. We will set a new Cap or Upside Participation Rate for each Indexed Strategy prior to the start of each Term.
The Downside Participation Rate, Floor or Buffer for a Strategy will not change from Term to Term. For each Term of each Indexed Strategy with a Downside Participation Rate that we currently offer, the Downside Participation Rate is 50%. For each Term of an Indexed Strategy with a Buffer that we currently offer, the Buffer is 10%. For each Term of the Indexed Strategies with a Floor that we currently offer, the Floor is -10% or 0%.
Each Term it is possible for you to lose a portion of the money you allocated to any Indexed Strategy.
Available Indexed Strategies
For this Contract, we currently offer fifteen Indexed Strategies. Each of these Indexed Strategies uses one of five Indexes: S&P 500® Index, iShares® MSCI EAFE ETF, iShares® U.S. Real Estate ETF, SPDR Gold Shares ETF, and First Trust Barclays Edge Index. Twelve of these Indexed Strategies have one-year Terms, two have two-year Terms, and one has a six-year Term.
Strategy |
Index | Term | Negative Return Factor |
Positive Return Factor | ||||
S&P 500 1-year 50% Downside Participation Rate with Cap |
S&P 500® | 1-year | 50% Downside Participation Rate |
Cap | ||||
S&P 500 2-year 50% Downside Participation Rate with Cap |
S&P 500® | 2-year | 50% Downside Participation Rate |
Cap | ||||
S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate |
S&P 500® | 1-year | 50% Downside Participation Rate |
Upside Participation Rate | ||||
S&P 500 2-year 50% Downside Participation Rate with Upside Participation Rate |
S&P 500® | 2-year | 50% Downside Participation Rate |
Upside Participation Rate | ||||
S&P 500 6-year 10% Buffer with Upside Participation Rate |
S&P 500® | 6-year | 10% Buffer | Upside Participation Rate | ||||
S&P 500 1-year 10% Buffer with Cap |
S&P 500® | 1-year | 10% Buffer | Cap | ||||
S&P 500 1-year -10% Floor with Cap |
S&P 500® | 1-year | -10% Floor | Cap | ||||
S&P 500 1-year 0% Floor with Cap* |
S&P 500® | 1-year | 0% Floor | Cap | ||||
iShares MSCI EAFE ETF 1-year 50% Downside Participation Rate with Upside Participation Rate |
MSCI EAFE ETF |
1-year | 50% Downside Participation Rate |
Upside Participation Rate | ||||
iShares U.S. Real Estate ETF 1-year 50% Downside Participation Rate with Upside Participation Rate |
U.S. Real Estate ETF |
1-year | 50% Downside Participation Rate |
Upside Participation Rate | ||||
iShares U.S. Real Estate ETF 1-year -10% Floor with Cap |
U.S. Real Estate ETF |
1-year | -10% Floor | Cap | ||||
SPDR Gold Shares ETF 1-year -10% Floor with Cap |
SPDR Gold Shares ETF |
1-year | -10% Floor | Cap | ||||
First Trust Barclays Edge 1-year 50% Downside Participation Rate with Upside Participation Rate* |
First Trust Barclays Edge |
1-year | 50% Downside Participation Rate |
Upside Participation Rate | ||||
First Trust Barclays Edge 1-year 10% Buffer with Upside Participation Rate* |
First Trust Barclays Edge |
1-year | 10% Buffer | Upside Participation Rate |
* | The S&P 500 1-year 0% Floor with Cap Strategy and the First Trust Barclays Edge Strategies are not available for Contracts issued in Missouri. |
22
Contractowners who purchased the Contract before May 1, 2023, may have allocated funds to two additional Indexed Strategies. These two Indexed Strategies have been discontinued. They are not available for new or existing contractowners for any new Term that begins after May 1, 2023:
Discontinued Strategy |
Index | Term | Negative Return Factor |
Positive Return Factor | ||||
iShares MSCI EAFE ETF 2-year Term with Participation Rate |
MSCI EAFE ETF |
2-year | 50% Downside Participation Rate |
Upside Participation Rate | ||||
iShares U.S. Real Estate ETF 2-year Term with Participation Rate |
U.S. Real Estate ETF |
2-year | 50% Downside Participation Rate |
Upside Participation Rate |
For existing contractowners, at the end of the current Term, any funds in one of these discontinued Indexed Strategies will be transferred to the 1-year 50% Downside Participation Rate with Upside Participation Rate Indexed Strategy that uses the same Index unless the contractowner elects otherwise.
Considerations in Choosing an Indexed Strategy
When choosing among Indexed Strategies, you should consider the characteristics and risk profiles of the Indexes, which are discussed in the Indexes section of this prospectus. You should also consider Term lengths. It is generally more difficult to predict Index performance over a longer Term. In addition, you cannot reallocate funds among Strategies before the end of a Term, and the only way to exit a Strategy before the end of a Term is to take a withdrawal or Surrender your Contract.
When choosing among Indexed Strategies that use the same Index, you should also consider how the Caps and Participation Rates may affect the potential return.
| An Indexed Strategy with Cap provides you with the opportunity to participate in any rise in the Index up to the Cap (after Daily Charges have been deducted from the Investment Base), but you will not participate in any rise in the Index in excess of the Cap. |
| An Indexed Strategy with an Upside Participation Rate provides you with the opportunity to share in any rise in the Index without a Cap, but your share of any rise is always expected to be less than 100%. |
If we assume the Upside Participation Rate is less than 100%, here is how an Indexed Strategy with Cap will perform in comparison to an Indexed Strategy with Participation Rate.
| In any Term where the rise in the Index is less than the Cap, the Cap Strategy will always perform better than the corresponding Upside Participation Rate Strategy. |
| In any Term where the rise in the Index is more than the Cap, but less than the Cap divided by the Upside Participation Rate, the Cap Strategy will always perform better than the corresponding Upside Participation Rate Strategy. |
| In any Term where the rise in the Index is more than the Cap divided by the Upside Participation Rate, the Upside Participation Rate Strategy will always perform better than the Cap Strategy. |
| In any Term where the Index falls, the Cap Strategy and Upside Participation Rate Strategy will produce the same results at the end of the Term if they have the same downside protection. However, before the end of the Term, due to different option pricing, they may have different Daily Value Percentages and returns. |
Examples. These examples are intended to help you understand the interplay between Caps and Upside Participation Rates for Indexed Strategies with similar Terms in different market environments and how this interplay affects the comparative performance of Indexed Strategies that use the same Index. The example assumes that both strategies have downside protection in the form of a 50% Downside Participation Rate.
Index rise |
Return at end of Term | |||||
12% Cap | 75% Upside Participation Rate |
Explanation | ||||
4% | 4% | 3% | The Cap Strategy has a better return than the Upside Participation Rate Strategy because the 4% rise in the Index is less than the 12% Cap. | |||
14% | 12% | 10.5% | The Cap Strategy has a better return than the Upside Participation Rate Strategy because the 14% rise in the Index is more than the 12% Cap, but less than 16% (the 12% Cap divided by the 75% Upside Participation Rate). | |||
16% | 12% | 12% | Both Strategies have the same positive return because the rise in the Index is equal to 16% (the 12% Cap divided by the 75% Upside Participation Rate). | |||
20% | 12% | 15% | The Upside Participation Rate Strategy has a better return than the Cap Strategy because the 20% rise in the Index is more than 16% (the 12% Cap divided by the 75% Upside Participation Rate) | |||
-30% | -15% | -15% | Both Strategies have the same negative return. |
23
See the Examples: Impact of Withdrawals on Contract Values and Amounts Realized section below for more information about the interplay between Caps and Upside Participation Rates for Indexed Strategies with different Terms in different market environments,
Term
Each Term of an Indexed Strategy will start and end on a Strategy Application Date. Each Term is either one year long, two years long, or six years long. A new Term will start at the end of the preceding Term.
If you make only one Purchase Payment or you make all of your Purchase Payments before the initial Strategy Application Date, then each Term of each Indexed Strategy will end on the same date in any given year. If you make a Purchase Payment after the initial Strategy Application Date, then your Purchase Payments will be applied to the Indexed Strategies on different Strategy Application Dates. In this case, an Indexed Strategy may have Terms that end on different dates in any given year.
Examples. These examples show how a Contract with multiple Purchase Payments may have Terms that end on different dates.
| You make your initial Purchase Payment on March 10 and another Purchase Payment on March 17. You allocate both payments to the same Indexed Strategy and both payments are applied on March 20. Each Term of that Indexed Strategy will start and end on March 20. |
| You make your initial Purchase Payment on May 2 and another Purchase Payment on June 14. You allocate both payments to the same Indexed Strategy. Your initial Purchase Payment is applied on May 6 and the other Purchase Payment is applied on June 20. That Indexed Strategy will have Terms that start and end on May 6 and other Terms that start and end on June 20. |
Investment Base
The value of an Indexed Strategy is calculated using the Investment Base. The Investment Base is not your Account Value, Surrender Value, Annuity Payout value, or Death Benefit value, but it is used to calculate those values.
The Investment Base is the amount applied to the Strategy at the start of the current Term, reduced proportionally for each withdrawal and related Early Withdrawal Charge during the current Term. The Investment Base is reduced daily by an amount equal to the Daily Charge.
A withdrawal and the Related Early Withdrawal Charge reduce the Investment Base by an amount that is proportional to the reduction in the value of the Indexed Strategy due to the withdrawal and the charge.
| If the Strategy value immediately before the withdrawal is greater than the Investment Base, then the reduction in the Investment Base will be less than the withdrawal and the related Early Withdrawal Charge. |
| If the Strategy value immediately before the withdrawal is less than the Investment Base, then the reduction in the Investment Base will be more than the withdrawal and the related Early Withdrawal Charge. |
24
Here are the formulas that we use to calculate a reduction in the Investment Base for a withdrawal, after Daily Charges have been taken into account.
Withdrawal as a percentage of Strategy value = withdrawal and related charge / Strategy value before withdrawal
Reduction in Investment Base = Investment Base before withdrawal x withdrawal as a percentage of Strategy value
Investment Base after withdrawal = Investment Base before withdrawalreduction in Investment Base
Indexed Strategy Value
At the end of a Term, unless you have made a Performance Lock election, the value of an Indexed Strategy is equal to:
| the Investment Base at the end of the Term; plus |
| any increase for a rise in the Index over the Term; or minus |
| any decrease for a fall in the Index over the Term. |
In this formula, the Investment Base at the end of the Term is equal to the amount applied to the Strategy at the start of that Term, reduced by Daily Charges, and reduced proportionally for each withdrawal and related Early Withdrawal Charge that you took during that Term. After we calculate the Investment Base at the end of the Term, we calculate any increase for a rise in the Index over that Term or any decrease for a fall in the Index over that Term. Any increase for the Term is subject to the Cap or Upside Participation Rate for that Term. Any decrease for the Term is subject to the Downside Participation Rate or Buffer.
Examples. At the end of a Term, the Investment Base in an Indexed Strategy is $5,000. You take a $1,000 withdrawal and no Early Withdrawal Charge applies to the withdrawal.
Assume that the Index had increased by 20% at the end of the Term, and either a Cap of 10% or an Upside Participation Rate of 50% was in place:
At Final Market Close of Term | ||
Rise in Index |
+20% | |
Increase as a Percentage |
+10% (10% Cap, or 50% Par Rate x 20%) | |
Dollar Amount of Increase |
+$500 ($5,000 x 10%) | |
Strategy value before Withdrawal |
$5,500 ($5,000 + $500) | |
Withdrawal Amount |
$1,000 | |
Strategy Value at Term End |
$4,500 ($5,500 - $1,000) |
If in this example an Early Withdrawal Charge of 5% applied to the entire withdrawal amount and you requested a net amount of $1,000, your withdrawal amount would have been $1,053 ($1,000 / (1 0.05)), resulting in a Strategy Value at Term End of $4,447 ($5,500 - $1,053).
Assume that the Index had decreased by 20% at the end of the Term, and a Buffer of 10%, a Floor of -10%, or a 50% Downside Participation Rate was in place:
At Final Market Close of Term | ||
Fall in Index |
-20% | |
Decrease as a Percentage |
-10% (20% fall minus 10% Buffer, or 50% Par Rate x -20%, or -10% Floor) | |
Dollar Amount of Decrease |
-$500 ($5,000 x -10%) | |
Strategy value before Withdrawal |
$4,500 ($5,000 - $500) | |
Withdrawal Amount |
$1,000 | |
Strategy Value at Term End |
$3,500 ($4,500 - $1,000) |
If in this example an Early Withdrawal Charge of 5% applied to the entire withdrawal amount and you requested a net amount of $1,000, your withdrawal amount would have been $1,053 ($1,000 / (1 0.05)), resulting in a Strategy value at Term End of $3,447 ($4,500 - $1,053).
On each day before the end of a Term, unless you have made a Performance Lock election, the value of an Indexed Strategy is equal to:
| the Investment Base on that day; plus |
| any increase for a positive Daily Value Percentage; or minus |
| any decrease for a negative Daily Value Percentage. |
25
In this formula, the Investment Base on each day before the end of the Term is equal to the amount applied to the Strategy at the start of that Term, reduced by Daily Charges, and reduced proportionally for each withdrawal and related Early Withdrawal Charge that you took on or before that day. After we calculate the Investment Base on that day, we calculate any increase for a positive Daily Value Percentage or any decrease for a negative Daily Value Percentage.
A withdrawal and the related Early Withdrawal Charge reduce the value of an Indexed Strategy by an amount equal to the withdrawal and the charge.
Examples. On the date of a withdrawal, the Investment Base in an Indexed Strategy is $5,000. You take a $1,000 withdrawal and no Early Withdrawal Charge applies to the withdrawal.
Assume that the Daily Value Percentage is 5% on the withdrawal date.
| The increase for the Daily Value Percentage is equal to $250 ($5,000 x 5%). |
| The Strategy value on the withdrawal date is $5,250 ($5,000 + $250). |
| The Strategy value after the withdrawal is $4,250 ($5,250 - $1,000). |
| The withdrawal as a percentage of the Strategy value is 19.05% ($1,000 / $5,250). |
| The reduction in the Investment Base is $952 ($5,000 x 19.05%). |
| The Investment Base after the withdrawal is $4,048 ($5,000 - $952). |
| Because the Strategy value on the withdrawal date was more than the Investment Base, the reduction in the Investment Base is only $952, which is less than the $1000 withdrawal. |
If in this example an Early Withdrawal Charge of 5% applied to the entire withdrawal amount and you requested a net amount of $1,000:
| The increase for the Daily Value Percentage is equal to $250 ($5,000 x 5%). |
| The Strategy value on the withdrawal date is $5,250 ($5,000 + $250). |
| The total amount withdrawn is $1,053 ($1,000 / (1 0.05)). |
| The Strategy value after the withdrawal is $4,197 ($5,250 - $1,053). |
| The withdrawal as a percentage of the Strategy value is 20.05% ($1,053 / $5,250). |
| The reduction in the Investment Base is $1,003 ($5,000 x 20.05%). |
| The Investment Base after the withdrawal is $3,997 ($5,000 - $1,003). |
| Because the Strategy value on the withdrawal date was more than the Investment Base, the reduction in the Investment Base was $1,003, which is less than the $1,053 withdrawal. |
Assume that the Daily Value Percentage is -10% on the withdrawal date.
| The reduction for the Daily Value Percentage is equal to $500 ($5,000 x -10%). |
| The Strategy value on the withdrawal date is $4,500 ($5,000 - $500). |
| The Strategy value after the withdrawal is $3,500 ($4,500 - $1,000). |
| The withdrawal as a percentage of the Strategy value is 22.22% ($1,000 / $4,500). |
| The reduction in the Investment Base is $1,111 ($5,000 x 22.22%). |
| The Investment Base after the withdrawal is $3,889 ($5,000 - $1,111). |
| Because the Strategy value on the withdrawal date was less than the Investment Base, the reduction in the Investment Base was $1,111, which is greater than the $1,000 withdrawal. |
If in this example an Early Withdrawal Charge of 5% applied to the entire withdrawal amount and you requested a net amount of $1,000:
| The reduction for the Daily Value Percentage is equal to $500 ($5,000 x 10%). |
| The Strategy value on the withdrawal date is $4,500 ($5,000 - $500). |
| The Strategy value after the withdrawal is $3,447 ($4,500 - $1,053). |
| The total amount withdrawn is $1,053 ($1,000 / (1 0.05)). |
| The withdrawal as a percentage of the Strategy value is 23.39% ($1,053 / $4,500). |
| The reduction in the Investment Base is $1,170 ($5,000 x 23.39%). |
| The Investment Base after the withdrawal is $3,830 ($5,000 - $1,170). |
| Because the Strategy value on the withdrawal date was less than the Investment Base, the reduction in the Investment Base was $1,170, which is greater than the $1,053 withdrawal. |
Performance Lock
Performance Lock is an election to lock in the Daily Value Percentage for the remainder of a Term of an Indexed Strategy. You can make a Performance Lock election for each Term of an S&P 500 Strategy and for each Term of a First Trust Barclays Edge Strategy that starts after the date of this prospectus. Only one performance lock election may be made for a given Term of a Strategy. Note: A Performance Lock election is not available for Contracts issued in Missouri.
26
You may make a Performance Lock election by a Request in Good Order. Once we receive your Request in Good Order, a Performance Lock election for a Term cannot be changed or revoked.
A Performance Lock election for a Term is effective on the second Market Close following our receipt of your Request in Good Order. After the second Market Close, the Strategy value before the end of the Term and the Strategy value at the end of the Term is based on the Daily Value Percentage as locked at that second Market Close. This means that the Net Option Value, Amortized Option Cost, and Trading Cost as of that second Market Close will apply from that date on through the end of the Term.
Beginning on that second Market Close and continuing through the end of the Term, the value of an Indexed Strategy is equal to:
| the Investment Base on that day; plus |
| any increase for a positive Daily Value Percentage, as locked on that second Market Close; or minus |
| any decrease for a negative Daily Value Percentage, as locked on that second Market Close. |
After a Performance Lock election is effective, the value of a locked Strategy will decline over the balance of the Term due to Daily Charges. The value of a locked Strategy will also be reduced by the amount of any withdrawal.
A Performance Lock election does not affect the Investment Base, so the Indexed Strategy value will still change if the Investment Base is reduced by a withdrawal.
If you make a Performance Lock election for the S&P 500 6-Year 10% Buffer with Upside Participation Rate Indexed Strategy before the sixth year of the Term, that Term will end on the next anniversary of the Term start date. If you take no action and do not send us a reallocation request by that anniversary, then we will apply the ending value of that Strategy to a new Term of the S&P 500 1-Year 50% Downside Participation rate with Upside Participation Rate Indexed Strategy.
Examples. You allocate $5,000 to an Indexed Strategy at the start of a 1-year Term. This means the Investment Base at the start of the Term is $5,000. You make a Performance Lock election, and on the second Market Close following receipt of that election the Daily Value Percentage is 5%.
Assume that you take no withdrawals.
| The increase for the locked Daily Value Percentage is equal to $250 ($5,000 x 5%). |
| On the second Market Close following receipt of the Performance Lock election, the Strategy value is $5,250 ($5,000 + $250). |
| The Strategy value on each following day of the Term remains $5,250 because the Daily Value Percentage is locked. No further changes in the Net Option Value, Amortized Option Cost, or Trading Cost are taken into account. |
| The ending Strategy value is $5,250. The normal calculation based on the percentage change in the Index over the 1-year Term does not apply. |
Assume you take a $1,000 withdrawal after the Performance Lock election is effective, and no Early Withdrawal Charge applies to the withdrawal:
| The increase for the locked Daily Value Percentage is equal to $250 ($5,000 x 5%). |
| On the second Market Close following receipt of the Performance Lock election, the Strategy value is $5,250 ($5,000 + $250). |
| Until the withdrawal, the Strategy value on each following day of the Term remains $5,250 because the Daily Value Percentage is locked. No further changes in the net option value, amortized option cost, or trading cost are taken into account. |
| Immediately after the $1,000 withdrawal, the Strategy value is $4,250 ($5,250$1,000). |
| The withdrawal as a percentage of the Strategy value is 19.05% ($1,000 / $5,250) |
| The proportionate reduction in the Investment Base is $952 ($5,000 x 19.05%). |
| The Investment Base after the withdrawal is $4,048 ($5,000$952). |
| Because the Strategy value on the withdrawal date was more than the Investment Base, the reduction in the Investment Base was $952, which is less than the $1,000 withdrawal. |
| After the withdrawal, on each following day of the Term, the increase for the locked Daily Value Percentage is equal to $202 ($4,048 x5%). |
| After the withdrawal, on each day of the Term, the Strategy value is $4,250 ($4,048 + $202). The reduction in the Strategy value is equal to the $1,000 withdrawal. |
| The ending Strategy value is $4,250. The normal calculation based on the percentage change in the Index over the 1-year Term does not apply. |
27
S&P 500 Index
The S&P 500® Index is designed to reflect the large-cap sector of the U.S. equity market and, due to its composition, it also represents the U.S. equity market in general. It includes 500 leading companies and captures approximately 80% coverage of available market capitalization. The S&P 500 Index does not include dividends declared by any of the companies in this index. Consequently, any positive change in the Index over a Term will be lower than the total return on a direct investment in the stocks that comprise the S&P 500 Index.
The S&P 500 Index is subject to multiple principal investment risks, such as those related to its investments in large-capitalization companies. The S&P 500 Index tracks a subset of the U.S. stock market, which could cause the S&P 500 Index to perform differently from the overall stock market. In general, large-capitalization companies may be unable to respond quickly to new competitive challenges, and may not be able to attain the high growth rate of successful smaller companies. In addition, the S&P 500 Index may, at times, become focused in stocks of a particular market sector, which would subject the S&P 500 Index to proportionately higher exposure to the risks of that sector.
The S&P 500 Index is a product of S&P Dow Jones Indices LLC or its affiliates (SPDJI), and has been licensed for use by MassMutual Ascend Life. Standard & Poors®, S&P®, S&P 500®, US 500, The 500, iBoxx®, iTraxx® and CDX® are trademarks of S&P Global, Inc. or its affiliates (S&P); Dow Jones® is a registered trademark of Dow Jones Trademark Holdings LLC (Dow Jones). MassMutual Ascend Life products are not sponsored, endorsed, sold or promoted by SPDJI, Dow Jones, S&P or their respective affiliates, and none of such parties makes any representation regarding the advisability of investing in such products nor do they have any liability for any errors, omissions, or interruption of the S&P 500 Index. For more information, visit www.US.SPIndices.com.
SPDR Gold Shares ETF
The SPDR Gold Shares represent units of beneficial interest in, and ownership of, the SPDR Gold Trust, an exchange traded fund that holds gold bullion. The investment objective of the trust is for the shares to reflect the performance of the price of gold bullion, less the trusts expenses. The shares are designed to mirror as closely as possible the price of gold, and the value of the shares relates directly to the value of the gold held by the trust, less its liabilities. The value of the gold held by the trust is determined using the London Bullion Market Association (LBMA) Gold Price PM.
The fund is subject to several principal investment risks related to the price of gold. The price of gold has fluctuated widely over the past several years and the shares have experienced significant price fluctuations. Several factors may affect the price of gold, including:
| Global gold supply and demand, which is influenced by such factors as golds uses in jewelry, technology and industrial applications, purchases made by investors in the form of bars, coins and other gold products, forward selling by gold producers, purchases made by gold producers to unwind gold hedge positions, central bank purchases and sales, and production and cost levels in major gold producing countries such as China, the United States and Australia; |
| Global or regional political, economic or financial events and situations, especially those unexpected in nature; |
| Investors expectations with respect to the rate of inflation; |
| Currency exchange rates; |
| Interest rates; |
| Investment and trading activities of hedge funds and commodity funds; and |
| Other economic variables such as income growth, economic output, and monetary policies. |
The principal investment risks of the fund are described in the funds prospectus, including the following risks: price risk, passive investment risk, trading market risk, and risk of loss, damage, theft, or restriction on access.
The Gold Shares trade on the NYSE Arca under the symbol GLD. For more information, visit www.spdrgoldshares.com.
iShares MSCI EAFE ETF
The iShares MSCI EAFE ETF is an exchange traded fund that seeks to track the investment results of an index composed of large- and mid-capitalization developed market equities, excluding the U.S. and Canada (MSCI EAFE Index). This underlying index includes stocks from Europe, Australasia and the Far East. It may include large- or mid-capitalization companies. The components of the underlying index, and the degree to which these components represent certain industries and/or countries, are likely to change over time. The funds adviser uses an indexing strategy that involves investing in a representative sample of securities that collectively has an investment profile similar to that of the underlying index. The funds performance will be reduced by its expenses and fees.
The fund is subject to several principal investment risks, such as those related to its investments in large- and mid-capitalization foreign companies. In general, large-capitalization companies may be unable to respond quickly to new competitive challenges, and may not be able to attain the high growth rate of successful smaller companies. Generally, the securities of mid-capitalization companies may be more volatile and may involve more risk than the securities of larger companies. Mid-capitalization companies are also more likely to fail than larger companies. Securities issued by non-U.S. companies are subject to the risks related to investments in foreign markets (e.g., increased price volatility; changing currency exchange rates; and greater political, regulatory and economic uncertainty). Because the fund is an ETF, it is also exposed to the risks associated with the operation of any ETF. The value of its shares, which are valued based on their trading prices in the secondary market, may change rapidly and unpredictably and may trade at premiums or discounts to the funds net asset value.
28
The principal investment risks of the fund are described in the funds prospectus, including the following risks: asset class risk, authorized participant concentration risk, concentration risk, currency risk, cyber security risk, equity securities risk, financials sector risk, geographic risk, index-related risk, issuer risk, large-capitalization companies risk, management risk, market risk, market trading risk, mid-capitalization companies risk, national closed market trading risk, non-U.S. securities risk, operational risk, passive investment risk, reliance on trading partners risk, risk of investing in developed countries, risk of investing in Japan, securities lending risk, structural risk, tracking error risk and valuation risk.
The funds shares trade on the NYSE Arca under the symbol EFA.
The iShares MSCI EAFE ETF is distributed by BlackRock Investments, LLC. iShares®, BLACKROCK®, and the corresponding logos are registered and unregistered trademarks of BlackRock, Inc. and its affiliates (BlackRock), and these trademarks have been licensed for certain purposes by MassMutual Ascend Life Insurance Company. MassMutual Ascend Life annuity products are not sponsored, endorsed, sold or promoted by BlackRock, and purchasers of an annuity from MassMutual Ascend Life do not acquire any interest in the iShares MSCI EAFE ETF nor enter into any relationship of any kind with BlackRock. BlackRock makes no representation or warranty, express or implied, to the owners of any MassMutual Ascend Life annuity product or any member of the public regarding the advisability of purchasing an annuity, nor does it have any liability for any errors, omissions, interruptions or use of the iShares MSCI EAFE ETF or any data related thereto.
iShares U.S. Real Estate ETF
The iShares U.S. Real Estate ETF is an exchange traded fund that seeks to track the investment results of an index composed of U.S. equities in the real estate sector (Dow Jones U.S. Real Estate Index). This underlying index may include large-, mid- or small-capitalization companies. A significant portion of the underlying index is represented by real estate investment trusts (REITs), but the components are likely to change over time. The funds adviser uses an indexing strategy that involves investing in a representative sample of securities that collectively has an investment profile similar to that of the underlying index. The funds performance will be reduced by its expenses and fees.
The fund is subject to several principal investment risks, such as those related to its investments in large-, mid- and small-capitalization U.S. companies in the real estate sector. In general, large-capitalization companies may be unable to respond quickly to new competitive challenges, and may not be able to attain the high growth rate of successful smaller companies. Generally, the securities of smaller companies (including mid- and small-capitalization companies) may be more volatile and may involve more risk than the securities of larger companies. Smaller companies are also more likely to fail than larger companies. Companies that invest in real estate are highly sensitive to the risks of owning real estate, to general and local economic conditions and developments in the real estate market, and to changes in interest rates. Many companies that invest in real estate utilize leverage (and some may be highly leveraged), which increases investment risk, and could potentially magnify the funds losses. Because the fund is an ETF, it is also exposed to the risks associated with the operation of any ETF. The value of its shares, which are valued based on their trading prices in the secondary market, may change rapidly and unpredictably and may trade at premiums or discounts to the funds net asset value.
The principal investment risks of the fund are described in the funds prospectus, including the following risks: asset class risk, authorized participant concentration risk, concentration risk, cyber security risk, dividend risk, equity securities risk, index-related risk, issuer risk, large-capitalization companies risk, management risk, market risk, market trading risk, mid-capitalization companies risk, operational risk, passive investment risk, real estate investment risk, risk of investing in the United States, securities lending risk and tracking error risk.
The funds shares trade on the NYSE Arca under the symbol IYR.
The iShares U.S. Real Estate ETF is distributed by BlackRock Investments, LLC. iShares®, BLACKROCK®, and the corresponding logos are registered and unregistered trademarks of BlackRock, Inc. and its affiliates (BlackRock), and these trademarks have been licensed for certain purposes by MassMutual Ascend Life Insurance Company. MassMutual Ascend Life annuity products are not sponsored, endorsed, sold or promoted by BlackRock, and purchasers of an annuity from MassMutual Ascend Life do not acquire any interest in the iShares U.S. Real Estate ETF nor enter into any relationship of any kind with BlackRock. BlackRock makes no representation or warranty, express or implied, to the owners of any MassMutual Ascend Life annuity product or any member of the public regarding the advisability of purchasing an annuity, nor does it have any liability for any errors, omissions, interruptions or use of the iShares U.S. Real Estate ETF or any data related thereto.
First Trust Barclays Edge Index
The First Trust Barclays Edge Index is designed to combine capital strength and value equity investment methodologies with a mix of US Treasuries for more consistent returns. The First Trust Barclays Edge Index consists of an equity component that combines stocks from the Capital Strength Index or The Value Line Dividend Index coupled with a volatility control using a mix of 2-year, 5-year and 10-year US Treasuries. Based on various market factors the First Trust Barclays Edge Index may vary the balance between stocks and bonds and the exposure to the market to target a seven percent (7%) volatility level. Note: The First Trust Barclays Edge Strategies are not available for Contracts issued in Missouri.
For more information visit https://www.ftindexingsolutions.com/
29
The First Trust Barclays Edge Index (FTIS Index) is a product of FT Indexing Solutions LLC (FTIS) and is administered and calculated by Bloomberg Finance L.P. and its affiliates (collectively, Bloomberg). FIRST TRUST® is a trademark of First Trust Portfolios L.P. (collectively, with FTIS and their respective affiliates, First Trust). The foregoing index and trademark have been licensed for use for certain purposes by Barclays, Bloomberg, and MassMutual Ascend Life Insurance Company (MassMutual Ascend) in connection with the FTIS Index and the Index Summit 6 Pro annuity.
The Capital Strength Index (Nasdaq Index) is a product of Nasdaq, Inc. (collectively, with its affiliates, Nasdaq). NASDAQ®, CAPITAL STRENGTH INDEXTM, and NQCAPSTTM are trademarks of Nasdaq. The foregoing index and trademarks have been licensed for use for certain purposes by FTIS and MassMutual Ascend in connection with the FTIS Index and the Index Summit 6 Pro annuity.
The Value Line Dividend Index (Value Line Index) is a product of Value Line, Inc. (Value Line). VALUE LINE® and VALUE LINE DIVIDEND INDEXTM are trademarks or registered trademarks of Value Line. The foregoing index and trademarks have been licensed for use for certain purposes by FTIS and MassMutual Ascend in connection with the FTIS Index and the Index Summit 6 Pro annuity. The FTIS Index is not sponsored, endorsed, recommended, sold or promoted by Value Line and Value Line makes no representation regarding the advisability of investing in the FTIS Index.
The Index Summit 6 Pro annuity is not issued, sponsored, endorsed, sold, recommended, or promoted by First Trust, Bloomberg, Nasdaq, Value Line, or their respective affiliates (collectively, the Companies). Bloombergs relationship to First Trust and Barclays is only (1) in the licensing of the FIRST TRUST®, BARCLAYS®, and FIRST TRUST BARCLAYS EDGE INDEXTM trademarks and (2) to act as the administrator and calculation agent of the First Trust Barclays Edge Index. The Companies have not passed on the legality or suitability of, or the accuracy or adequacy of descriptions and disclosures relating to the Index Summit 6 Pro annuity. The Companies make no representation or warranty, express or implied, to the owners of any product based on the FTIS Index, Barclays Indexes, Nasdaq Index, or Value Line Index, or to any member of the public regarding the advisability of investing in securities generally or in products based on the FTIS Index, Dow Index, Nasdaq Indices, or Value Line Index particularly, or the ability of the FTIS Index, Dow Index, Nasdaq Indices, or Value Line Index to track general stock market performance. The Companies only relationship to MassMutual Ascend is in the licensing of the certain trademarks, trade names, and service marks and the use of the FTIS Index, Dow lndex, Nasdaq Indices, and Value Line Indices, which are determined, composed and calculated without regard to MassMutual Ascend or the Index Summit 6 Pro annuity. The Companies have no obligation to take the needs of MassMutual Ascend, or the owners of the Index Summit 6 Pro annuity, or the sponsors or owners of products based on the FTIS Index, Barclays Indexes, Nasdaq Index, or Value Line Index into consideration when determining, composing, or calculating the FTIS Index, Barclays Indexes, Nasdaq Index, and Value Line Index. The Companies are not responsible for and have not participated in the determination or calculation of the Index Summit 6 Pro annuity. There is no assurances from the Companies that products based on the FTIS Index, Barclays Indexes, Nasdaq Index, or Value Line Index will accurately track index performance or provide positive investment returns. The Companies are not investment advisors. Inclusion of a security or financial instrument within an index is not a recommendation by the Companies to buy, sell, or hold such security or financial instrument, nor is it considered to be investment advice.
THE COMPANIES DO NOT GUARANTEE THE ADEQUACY, ACCURACY, TIMELINESS, COMPLETENESS, AND/OR UNINTERRUPTED CALCULATION OF THE INDEX SUMMIT 6 PRO ANNUITY, FTIS INDEX, BARCLAYS INDEXES, NASDAQ INDEX, VALUE LINE INDEX, OR ANY DATA INCLUDED THEREIN OR ANY COMMUNICATION WITH RESPECT THERETO, INCLUDING, ORAL, WRITTEN, OR ELECTRONIC COMMUNICATIONS. THE COMPANIES SHALL HAVE NO LIABILITY FOR ANY ERRORS, OMISSIONS, OR INTERRUPTIONS IN THE INDEX SUMMIT 6 PRO ANNUITY, FTIS INDEX, BARCLAYS INDEXES, NASDAQ INDEX, OR VALUE LINE INDEX. THE COMPANIES MAKE NO WARRANTY, EXPRESS OR IMPLIED, AS TO THE RESULTS TO BE OBTAINED BY OWNERS OF THE INDEX SUMMIT 6 PRO ANNUITY OR OF PRODUCTS BASED ON THE FTIS INDEX, BARCLAYS INDEXES, NASDAQ INDEX, OR VALUE LINE INDEX, OR BY ANY OTHER PERSON OR ENTITY FROM THE USE OF THE FTIS INDEX, BARCLAYS INDEXES, NASDAQ INDEX, OR VALUE LINE INDEX, OR ANY DATA INCLUDED THEREIN. THE COMPANIES MAKE NO EXPRESS OR IMPLIED WARRANTIES, AND EXPRESSLY DISCLAIM ALL WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE WITH RESPECT TO THE INDEX SUMMIT 6 PRO ANNUITY, FTIS INDEX, BARCLAYS INDEXES, NASDAQ INDEX, VALUE LINE INDEX, OR ANY DATA INCLUDED THEREIN. WITHOUT LIMITING ANY OF THE FOREGOING, IN NO EVENT SHALL THE COMPANIES BE SUBJECT TO ANY DAMAGES OR HAVE ANY LIABILITY FOR ANY INDIRECT, SPECIAL, INCIDENTAL, PUNITIVE, INDIRECT, OR CONSEQUENTIAL DAMAGES OR LOSSES, INCLUDING BUT NOT LIMITED TO, LOSS OF PROFITS, TRADING LOSSES, LOST TIME, OR GOODWILL, EVEN IF NOTIFIED OF THE POSSIBILITY OF SUCH DAMAGES, WHETHER IN CONTRACT, TORT, STRICT LIABILITY, OR OTHERWISE. THERE ARE NO THIRD PARTY BENEFICIARIES OF ANY AGREEMENTS OR ARRANGEMENTS BETWEEN MASSMUTUAL ASCEND AND THE COMPANIES.
Neither Barclays Bank PLC (BB PLC) nor any of its affiliates (collectively Barclays) is the issuer or producer of the Index Summit 6 Pro annuity and Barclays has no responsibilities, obligations or duties to investors in the Index Summit 6 Pro annuity. The Barclays US 2Y Treasury Futures Index, Barclays US 5Y Treasury Futures Index, Barclays US 10Y Treasury Futures Index, and Barclays US 30Y Treasury Futures Index (collectively, the Indices), together with any Barclays indices that are components of the Indices, are trademarks owned by Barclays and, together with any component indices and index data, are licensed for use by MassMutual Ascend as the issuer or producer of the Index Summit 6 Pro annuity (the Issuer).
30
Barclays only relationship with the Issuer in respect of the Indices is the licensing of the Indices, which are administered, compiled and published by BB PLC in its role as the index sponsor (the Index Sponsor) without regard to the Issuer or the Index Summit 6 Pro annuity or investors in the Index Summit 6 Pro annuity. Additionally, MassMutual Ascend as issuer or producer of the Index Summit 6 Pro annuity may for itself execute transaction(s) with Barclays in or relating to the Indices in connection with the Index Summit 6 Pro annuity. Investors acquire the Index Summit 6 Pro annuity from MassMutual Ascend and investors neither acquire any interest in the Indices nor enter into any relationship of any kind whatsoever with Barclays upon making an investment in the Index Summit 6 Pro annuity. The Index Summit 6 Pro annuity is not sponsored, endorsed, sold or promoted by Barclays and Barclays makes no representation regarding the advisability of the Index Summit 6 Pro annuity or use of the Indices or any data included therein. Barclays shall not be liable in any way to the Issuer, investors or to other third parties in respect of the use or accuracy of the Indices or any data included therein.
Barclays Index Administration (BINDA), a distinct function within BB PLC, is responsible for day-to-day governance of BB PLCs activities as Index Sponsor. To protect the integrity of Barclays indices, BB PLC has in place a control framework designed to identify and remove and/or mitigate (as appropriate) conflicts of interest. Within the control framework, BINDA has the following specific responsibilities:
| oversight of any third party index calculation agent; |
| acting as approvals body for index lifecycle events (index launch, change and retirement); and |
| resolving unforeseen index calculation issues where discretion or interpretation may be required (for example: upon the occurrence of market disruption events). |
To promote the independence of BINDA, the function is operationally separate from BB PLCs sales, trading and structuring desks, investment
managers, and other business units that have, or may be perceived to have, interests that may conflict with the independence or integrity of Barclays indices.
Notwithstanding the foregoing, potential conflicts of interest exist as a consequence of BB PLC providing indices alongside its other businesses. Please note the following in relation to Barclays indices:
| BB PLC may act in multiple capacities with respect to a particular index including, but not limited to, functioning as index sponsor, index administrator, index owner and licensor. |
| Sales, trading or structuring desks in BB PLC may launch products linked to the performance of a index. These products are typically hedged by BB PLCs trading desks. In hedging an index, a trading desk may purchase or sell constituents of that index. These purchases or sales may affect the prices of the index constituents which could in turn affect the level of that index. |
| BB PLC may establish investment funds that track an index or otherwise use an index for portfolio or asset allocation decisions. |
The Index Sponsor is under no obligation to continue the administration, compilation and publication of the Indices or the level of the Indices. While the Index Sponsor currently employs the methodology ascribed to the Indices (and application of such methodology shall be conclusive and binding), no assurance can be given that market, regulatory, juridical, financial, fiscal or other circumstances (including, but not limited to, any changes to or any suspension or termination of or any other events affecting any constituent within the Index) will not arise that would, in the view of the Index Sponsor, necessitate an adjustment, modification or change of such methodology. In certain circumstances, the Index Sponsor may suspend or terminate the Indices. The Index Sponsor has appointed a third-party agent (the Index Calculation Agent) to calculate and maintain the Indices. While the Index Sponsor is responsible for the operation of the Indices, certain aspects have thus been outsourced to the Index Calculation Agent.
Barclays
1. makes no representation or warranty, express or implied, to the Issuer or any member of the public regarding the advisability of investing in transactions generally or the ability of the Indices to track the performance of any market or underlying assets or data; and
2. has no obligation to take the needs of the Issuer into consideration in administering, compiling or publishing the Indices.
Barclays has no obligation or liability in connection with administration, marketing or trading of the Index Summit 6 Pro annuity.
The licensing agreement between MassMutual Ascend and BB PLC is solely for the benefit of MassMutual Ascend and Barclays and not for the benefit of the owners of the Index Summit 6 Pro annuity, investors or other third parties.
BARCLAYS DOES NOT GUARANTEE, AND SHALL HAVE NO LIABILITY TO THE PURCHASERS AND TRADERS, AS THE CASE MAY BE, OF THE TRANSACTION OR TO THIRD PARTIES FOR THE QUALITY, ACCURACY AND/OR COMPLETENESS OF THE INDICES OR ANY DATA INCLUDED THEREIN OR FOR INTERRUPTIONS IN THE DELIVERY OF THE INDICES. BARCLAYS MAKES NO EXPRESS OR IMPLIED WARRANTIES, AND HEREBY EXPRESSLY DISCLAIMS ALL WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE WITH RESPECT TO THE INDICES INCLUDING, WITHOUT LIMITATION, THE INDICES, OR ANY DATA INCLUDED THEREIN. IN NO EVENT SHALL BARCLAYS HAVE ANY LIABILITY FOR ANY SPECIAL, PUNITIVE, INDIRECT, OR CONSEQUENTIAL DAMAGES, OR ANY LOST PROFITS, EVEN IF NOTIFIED OF THE POSSIBLITY OF SUCH DAMAGES SAVE TO THE EXTENT THAT SUCH EXCLUSION OF LIABILITY IS PROHIBITED BY LAW.
None of the information supplied by Barclays and used in this publication may be reproduced in any manner without the prior written permission of Barclays Bank PLC. Barclays Bank PLC is registered in England No. 1026167. Registered office 1 Churchill Place London E14 5HP.
31
Bloomberg Index Services Limited is the official index calculation and maintenance agent of the Index, an index owned and administered by Barclays. Bloomberg Index Services Limited does not guarantee the timeliness, accurateness, or completeness of the Index calculations or any data or information relating to the Index. Bloomberg Index Services Limited makes no warranty, express or implied, as to the Index or any data or values relating thereto or results to be obtained therefrom, and expressly disclaims all warranties of merchantability and fitness for a particular purpose with respect thereto. To the maximum extent allowed by law, Bloomberg Index Services Limited, its affiliates, and all of their respective partners, employees, subcontractors, agents, suppliers and vendors (collectively, the protected parties) shall have no liability or responsibility, contingent or otherwise, for any injury or damages, whether caused by the negligence of a protected party or otherwise, arising in connection with the calculation of the Index or any data or values included therein or in connection therewith and shall not be liable for any lost profits, losses, punitive, incidental or consequential damages.
Index Values
For Indexed Strategies that use the S&P 500 Index or the First Trust Barclays Edge Index, the Index is the level of the S&P 500 Index or the First Trust Barclays Edge Index for the applicable Market Close. For Indexed Strategies that use the SPDR Gold Shares ETF, the iShares MSCI EAFE ETF or the iShares U.S. Real Estate ETF, the Index is the applicable exchange-traded funds share price on the NYSE Arca at the applicable Market Close.
We will use consistent sources to obtain the values of an Index. We currently obtain the values for the S&P 500 Index and the SPDR Gold Shares ETF from S&P Dow Jones Indices LLC and the values for the iShares MSCI EAFE ETF and iShares U.S. Real Estate ETF from BlackRock, Inc. and the value of the First Trust Barclays Edge Index from Bloomberg Index Services Limited. If those sources are no longer available, we will select an alternative published source(s) to obtain such values.
Index Replacement
We may replace an Index: if it is discontinued, we are no longer able to use it, its calculation changes substantially, or we determine that hedging instruments are difficult to acquire or the cost of hedging becomes excessive. We may do so at the end of a Term or during a Term. We will notify you in writing at least 30 days before we replace an Index.
We would attempt to choose a replacement Index that is similar to the old Index. To determine if a new Index is similar, we will consider factors such as asset class, index composition, strategy or methodology inherent to the index and index liquidity.
If we replace an Index during a Term, we will calculate the rise and fall in the Index using the old Index up until the replacement date. After the replacement date, we will calculate the rise and fall in the Index using the new Index, but with a modified start of Term value for the new Index. The modified start of Term value for the new index will reflect the rise or fall in the Index for the old Index from the start of the Term to the replacement date.
If we replace an Index, the Caps and Upside Participation Rates for the Term and the Floor, Buffer and Downside Participation Rate will not change.
Example. This example is intended to show how we would calculate the Strategy value on any day during a Term if we have replaced an Index during the Term. This example assumes: (1) you allocate $50,000 to an Indexed Strategy; (2) the replacement is made on day 90 of the Term; and (3) no Performance Lock election has been made. To simplify the example, we assume that you take no withdrawals during the Term.
Rise or Fall of Index on Replacement Date for Old Index | ||
Old Index at Term start |
1000 | |
Old Index on replacement date |
1050 | |
Rise or fall of old Index on replacement date |
(1050 - 1000) / 1,000 = 5% |
32
The 5% rise in the old Index on the replacement date is then used to calculate the modified start of Term value for the new Index.
Modified Start of Term Value for New Index | ||
Rise in old Index on replacement date |
5% | |
New Index on replacement date |
1785 | |
Modified start of Term value for new Index |
1785 / (100% + 5%) = 1700 |
The modified start of Term value for the new Index is then used to calculate the Indexed Strategy value on any date after the replacement date, including the value at the Term end.
Indexed Strategy Value at Term End | ||
Investment Base at Term start |
$50,000 | |
Accumulated Daily Charges |
$375 | |
Investment Base After Daily Charges |
$49,625 | |
Modified start of Term value for new Index |
1700 | |
Value of new Index at Term end |
1853 | |
Rise in new Index |
(1853 - 1,700) / 1700) = 9% | |
Cap |
8% | |
Rise in new Index limited by Cap |
8% | |
Increase as a percentage |
8% x 100% = 8% | |
Dollar amount of increase |
$49,625 x 8% = $3,970 | |
Strategy value at Term end |
$49,625 + $3,970 = $53,595 |
CAPS, PARTICIPATION RATES, FLOORS, AND BUFFERS
We set limits for the increase and reduction in the value of an Indexed Strategy over a Term that apply after Daily Charges are deducted from the Investment Base. We limit increases with a Cap or an Upside Participation Rate. We limit reductions with a Downside Participation Rate, Floor, or a Buffer. For information about the current Caps and Participation Rates offered for new Contracts, please contact your registered representative or refer to our website (www.massmutualascend.com/RILArates).
Cap. The Cap for an Indexed Strategy is the largest rise in the Index over a Term that is taken into account to determine the Strategy value at the end of that Term. Before the end of a Term, the Cap is reflected in the formulas that we use to calculate the Net Option Price.
| The Cap will vary among Indexed Strategies. |
| The Cap for a given Indexed Strategy will vary from Term to Term. |
| We guarantee that the Cap for a Term of an Indexed Strategy will never be less than 1%. |
| For each Term, your return on an Indexed Strategy with a Cap will be less than any rise in the Index over that Term. |
| For each Term, your return on an Indexed Strategy with a Cap will be less than the Cap for that Term. |
| Your return on an Indexed Strategy with a Cap could be negative even when the Index rises. This will occur when the amount of increase attributable to an Index rise is smaller than the Daily Charge. |
Upside Participation Rate. The Upside Participation Rate for an Indexed Strategy is your share of any rise in the Index over a Term that is taken into account to determine the Strategy value at the end of that Term. Before the end of a Term, the Upside Participation Rate is reflected in the formulas that we use to calculate Net Option Price.
| The Upside Participation Rate will vary among Indexed Strategies. |
| The Upside Participation Rare for a given Indexed Strategy will vary from Term to Term. |
| We guarantee that the Upside Participation Rate for a Term of an Indexed Strategy will never be less than 5%. |
| For each Term, your return on an Indexed Strategy with an Upside Participation Rate of less than 100% will be less than any rise in the Index over that Term. In addition, any increase for the Term will be reduced by the Daily Charge. |
| Your return on an Indexed Strategy with an Upside Participation Rate could be negative even when the Index rises. This will occur when the amount of increase attributable to an Index rise is smaller than the Daily Charge. |
Caps and Upside Participation Rates. We set Caps and Upside Participation Rates based on the length of the Term, the cost of hedging, interest rates, and other market factors. On a non-discriminatory basis, we may also take into account the amount of the Purchase Payments received for a Contract. The Caps and Upside Participation Rates for Contracts with larger Purchase Payments may be higher than the Caps and Upside Participations Rates for Contracts with smaller Purchase Payments.
33
Caps and Upside Participation Rates for Initial Terms. Each Purchase Payment is applied to an initial Term of a Strategy on the first Strategy Application Date on or after the date that the payment is received. The Caps and Upside Participation Rates for each Strategy Application Date may vary. The Caps and Upside Participation Rates for the first Strategy Application Date will be available on our website (www.massmutualascend.com/RILArates) on the date you signed the application (as long as we receive the application for the Contract within eight days after the date you sign it) and before the date of any Purchase Payment to which the Caps or Upside Participation Rates will apply. If we receive the application for the Contract within eight days after the date you sign it, we will guarantee the Caps and Upside Participation Rates in effect on the date you signed the application for three Strategy Application Dates from the date of the application.
If we receive the signed application within eight days after the date you sign it, then for any 1-year Indexed Strategy or 2-year Indexed Strategy:
| For an initial Term starting on the first Strategy Application Date on or after the application date, the Cap or Upside Participation Rate will be the Cap or Upside Participation Rate in effect on the date you signed the application. |
| For an initial Term starting on one of the next two Strategy Application Dates, the Cap or Upside Participation Rate will be the higher of the Cap or Upside Participation Rate in effect on the date you signed the application or the Cap or Upside Participation Rate otherwise in effect for that Strategy Application Date. |
| For any initial Term starting on a later Strategy Application Date, the Cap or Upside Participation Rate will be the Cap or Upside Participation Rate in effect for that Strategy Application Date. |
If we receive the signed application within eight days after the date you sign it, then for the 6-year Indexed Strategy:
| For an initial Term starting on the first Strategy Application Date on or after the application date or one of the next two Strategy Application Dates, the Cap or Upside Participation Rate will be the Cap or Upside Participation Rate in effect on the date you signed the application. |
| For any initial Term starting on a later Strategy Application Date, the Cap or Upside Participation Rate will be the Cap or Upside Participation Rate in effect for that Strategy Application Date. |
If we receive the signed application more than eight days after the date you sign it, then the guarantee does not apply and the Cap or Upside Participation Rate for each Initial Term will be the Cap or Upside Participation Rate in effect for that Strategy Application Date.
Example 1: You sign an application for a Contract on May 1 and allocate all of your Purchase Payments to the S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy. On the date of the application, the Upside Participation Rate for the first Strategy Application Date (May 6) is 80%. We receive the application and the first Purchase Payment from you on May 8 and the second Purchase Payment from you on May 23. The Upside Participation Rates for the next two Strategy Application Dates are 85% (May 20) and 75% (June 6).
In this case, the initial 1-year Term for the first Purchase Payment would begin on May 20 and would have an 85% Participation Rate (the higher of the May 6 rate or the May 20 rate). The initial 1-year Term for the second Purchase Payment would begin on June 6 and would have an 80% Participation Rate (the higher of the May 6 rate or the June 6 rate).
If we had not received your signed application until May 10 (more than eight days after the date you signed the application), then you would not qualify for the rate guarantee, and the initial 1-year Term for the first Purchase Payment received on May 8 would have an 85% Participation Rate (the May 20 rate effective for Purchase Payments received between May 7 and May 20), and the initial 1-year Term for the second Purchase Payment received on May 23 would have a 75% Participation Rate (the June 6 rate effective for Purchase Payments received between May 21 and June 6).
Example 2: You sign an application for a Contract on May 1 and allocate all of your Purchase Payments to the 6-year 10% Buffer with Upside Participation Rate Strategy. On the date of the application, the Upside Participation Rate for the first Strategy Application Date (May 6) is 105%. We receive the application and the first Purchase Payment from you on May 8 and the second Purchase Payment from you on May 23. The Upside Participation Rates for the next two Strategy Application Dates are 110% (May 20) and 95% (June 6).
In this case, the initial 6-year Term for the first Purchase Payment would begin on May 20 and would have a 105% Participation Rate (the May 6 rate), and the initial 6-year Term for the second Purchase Payment would have a 105% Participation Rate (the May 6 rate).
If we had not received your signed application until May 10 (more than eight days after the date you signed the application), then the initial 6-year Term for the first Purchase Payment would have an 110% Participation Rate (the May 20 rate), and the initial 1-year Term for the second Purchase Payment would have a 95% Participation Rate (the June 6 rate).
Caps and Upside Participation Rate for Subsequent Terms. At least 30 days before the end of each Term, we will send you a written notice with information about the Indexed Strategies that will be available for the next Term, and will indicate the date by which the Caps and Upside Participation Rates will be posted on our website. The Caps and Participation Rates for the next Term will be available on our website (www.massmutualascend.com/RILArates) at least 10 days before the start of the Term. You should consider this information before finalizing your renewal or reallocation decision.
34
Downside Participation Rate. The Downside Participation Rate for an Indexed Strategy is your share of any fall in the Index over the Term that is taken into account to determine the Strategy value at the end of that Term. Before the end of a Term, the Downside Participation Rate is reflected in the formulas that we use to calculate the Net Option Price.
For each Term of each Strategy other than the Buffer Strategy that we currently offer for this Contract, the Downside Participation Rate is 50%. The Downside Participation Rate for an Indexed Strategy that is available on the Contract Effective Date will not change.
When the Index falls over a Term, the resulting Strategy Value decrease will be larger than 50% of the Index fall. This is because the Daily Charge reduces the Investment Base before the Index fall is taken into account.
In the future, we may offer a new Strategy with a Downside Participation Rate that is more or less than 50%.
Floor. The Floor for an Indexed Strategy is the portion of any fall in the Index for the Term that is taken into account to determine the Strategy value at the end of that Term. For each Term of each Floor Strategy that we currently offer for this Contract, the Floor is either -10% or 0%. Before the end of a Term, the Floor is reflected in the formulas that we use to calculate the Net Option Price.
The Floor for an Indexed Strategy that is available on the Contract Effective Date will not change.
In the future, we may offer a new Floor Strategy with a Floor that is more or less negative than -10%.
Buffer. The Buffer for an Indexed Strategy is the portion of any fall in the Index over the Term that is disregarded when determining the Strategy value at the end of that Term. Before the end of a Term, the Buffer is reflected in the formulas that we use to calculate the Net Option Price.
For each Term of each Buffer Strategy that we currently offer for this Contract, the Buffer is 10%. The Buffer for an Indexed Strategy that is available on the Contract Effective Date will not change.
When the Index falls over a Term, the resulting Buffer Strategy Value decrease will be larger than the rate of the Index fall minus 10%. This is because the Daily Charge reduces the Investment Base before the Index fall is taken into account.
In the future, we may offer a new Strategy with a Buffer that is more or less than 10%.
INDEXED STRATEGY VALUE AT END OF TERM
On or after the final Market Day of a Term, unless you have made a Performance Lock election, the value of an Indexed Strategy is the Investment Base increased for any rise in the applicable Index or decreased for any fall in the applicable Index over that Term. If you have made a Performance Lock election, then the normal rules set out in this section do not apply, and the value at the end of a Term is determined as described under Indexed Strategy Value After Performance Lock Election section on page [ ].
After taking Daily Charges into account, any increase or decrease is based on the rise or fall in the applicable Index since the start of that Term. This rise or fall is expressed as a percentage of the Index at the start of the Term. It is measured from the Index at the last Market Close on or before the first day of that Term to the Index at the final Market Close of the Term.
Example. The Index was 1000 at the last Market Close on or before for first day of a Term.
| If the Index at the final Market Close of the Term is 1065, then the Index has risen by 6.5% ((1065 1000) / 1000). |
| If the Index at the final Market Close of the Term is 925, then the Index has fallen by 7.5% ((925 1000) / 1000). |
Downside Participation Rate with Cap Strategy
In the absence of a Performance Lock election, here are the formulas that we use to calculate the Strategy value at the end of a Term of a Downside Participation Rate Strategy with a Cap.
Strategy value at end of Term = Investment Base + dollar amount of increase or decrease
Dollar amount of increase or decrease = Investment Base (after taking Daily Charges into account) x increase or decrease percentage
Increase percentage = any rise in the Index over the Term, but never more than the Cap
Decrease percentage = any fall in the Index over the Term x Downside Participation Rate
35
Example. At the beginning of a Term, you allocate $100,756 to a 50% Downside Participation Rate with Cap Strategy and the Cap for the Term is 14%. Your Investment Base at the end of that Term is $100,000 ($100,756$756 in Daily Charges). You have not made a Performance Lock election.
At Final Market Close of Term | At Final Market Close of Term | |||
Rise or fall in Index |
+16% | 16% | ||
Increase or decrease percentage |
+14% (16% > 14% Cap) | 8% (50% of 16%) | ||
Dollar amount of increase or decrease |
+14,000 ($100,000 x 14%) | 8,000 ($100,000 x 8%) | ||
Strategy value at end of Term |
$114,000 ($100,000 + $14,000) | $92,000 ($100,000 - $8,000) |
Downside Participation Rate with Upside Participation Rate Strategy
In the absence of a Performance Lock election, here are the formulas that we use to calculate the Strategy value at the end of a Term of a Downside Participation Rate with Upside Participation Rate Strategy.
Strategy value at end of Term = Investment Base + dollar amount of increase or decrease
Dollar amount of increase or decrease = Investment Base (after taking Daily Charges into account) x increase or decrease percentage
Increase percentage = any rise in the Index over the Term x Upside Participation Rate
Decrease percentage = any fall in the Index over the Term x Downside Participation Rate
Example. At the beginning of a Term, you allocate $100,756 to a 50% Downside Participation Rate with Upside Participation Rate Strategy and the Upside Participation Rate for the Term is 75%. Your Investment Base at the end of that Term is $100,000 ($100,756 - $756 in Daily Charges). You have not made a Performance Lock election.
At Final Market Close of Term | At Final Market Close of Term | |||
Rise or fall in Index |
+16% | 16% | ||
Increase or decrease percentage |
+12% (75% of 16%) | 8% (50% of 16%) | ||
Dollar amount of increase or decrease |
+12,000 ($100,000 x 12%) | 8,000 ($100,000 x 8%) | ||
Strategy value at end of Term |
$112,000 ($100,000 + $12,000) | $92,000 ($100,000 - $8,000) |
Buffer with Upside Participation Rate Strategy
In the absence of a Performance Lock election, here are the formulas that we use to calculate the Strategy value at the end of a Term of a Buffer with Upside Participation Rate Strategy.
Strategy value at end of Term = Investment Base + dollar amount of increase or decrease
Dollar amount of increase or decrease = Investment Base (after taking Daily Charges into account) x increase or decrease percentage
Increase percentage = any rise in the Index over the Term x Upside Participation Rate
Decrease percentage for the Buffer with Upside Participation Rate Strategy = any fall in the Index over the Term to the extent it is greater than the Buffer
Example. At the beginning of a Term, you allocate $100,756 to 10% Buffer with Upside Participation Rate Strategy and the Upside Participation Rate for the Term is 130%. Your Investment Base at the end of that Term is $100,000 ($100,756$756 in Daily Charges). You have not made a Performance Lock election.
At Final Market Close of Term | At Final Market Close of Term | |||
Rise or fall in Index |
+16% | 16% | ||
Increase or decrease percentage |
+20.8% (130% of 16%) | 6% (-16% - -10%) | ||
Dollar amount of increase or decrease |
+20,800 ($100,000 x 20.8%) | 6,000 ($100,000 x 6%) | ||
Strategy value at end of Term |
$120,800 ($100,000 + $20,800) | $94,000 ($100,000 - $6,000) |
36
Buffer with Cap Strategy
In the absence of a Performance Lock election, here are the formulas that we use to calculate the Strategy value at the end of a Term of 10% Buffer with Cap Strategy.
Strategy value at end of Term = Investment Base + dollar amount of increase or decrease
Dollar amount of increase or decrease = Investment Base x increase or decrease percentage
Increase percentage = any rise in the Index over the Term, but never more than the Cap
Decrease percentage = any fall in the Index over the Term to the extent it is greater than the Buffer
Example. At the beginning of a Term, you allocate $100,756 to 10% Buffer with Cap Strategy and the Cap for the Term is 13%. You do not take any withdrawals during that Term, Your Investment Base at the end of that Term is $100,000 ($100,756 - $756 in Daily Charges). You have not made a Performance Lock election.
At Final Market Close of Term | At Final Market Close of Term | |||
Rise or fall in Index |
+16% | 16% | ||
Increase or decrease percentage |
+13% (16% > 13% Cap) | 6% (16% - -10%) | ||
Dollar amount of increase or decrease |
+13,000 ($100,000 x 13%) | 6,000 ($100,000 x 6%) | ||
Strategy value at end of Term |
$113,000 ($100,000 + $13,000) | $94,000 ($100, 000 - $6,000) |
Floor with Cap Strategy
In the absence of a Performance Lock election, here are the formulas that we use to calculate the Strategy value at the end of a Term of a Floor with Cap Strategy.
Strategy value at end of Term = Investment Base + dollar amount of increase or decrease
Dollar amount of increase or decrease = Investment Base x increase or decrease percentage
Increase percentage = any rise in the Index over the Term, but never more than the Cap
Decrease percentage = any fall in the Index over the Term, but never more than the Floor
Example. At the beginning of a Term, you allocate $100,756 to a -10% Floor with Cap Strategy and the Cap for the Term is 14%. You do not take any withdrawals during that Term. Your Investment Base at the end of that Term is $100,000 ($100,756$756 in Daily Charges). You have not made a Performance Lock election.
At Final Market Close of Term | At Final Market Close of Term | |||
Rise or fall in Index |
+16% | 16% | ||
Increase or decrease percentage |
+14% (16% > 14% Cap) | 10% (16% < -10%) | ||
Dollar amount of increase or decrease |
+14,000 ($100,000 x 14%) | 10,000 ($100,000 x 10%) | ||
Strategy value at end of Term |
$114,000 ($100,000 + $14,000) | $90,000 ($100, 000 - $10,000) |
37
INDEXED STRATEGY VALUE BEFORE END OF TERM
Before the final Market Day of a Term, unless you have made a Performance Lock election, the value of an Indexed Strategy is the Investment Base increased or decreased by the Daily Value Percentage. If you have made a Performance Lock election, then the normal rules set out in this section do not apply, and the value after the effective date of the Performance Lock election through the end of the Term is determined as described under Indexed Strategy Value After Performance Lock Election section below.
In the absence of a Performance Lock election, here are the formulas that we use to calculate the Strategy value before the end of a Term.
Strategy value before end of Term = Investment Base + dollar amount of increase or decrease
Dollar amount of increase or decrease = Investment Base (after Daily Charges are taken into account) x Daily Value Percentage
Daily Value Percentage = Net Option Price Amortized Option Cost Trading Cost
Net Option Price
The Net Option Price is one part of the Daily Value Percentage. The Net Option Price is based on the calculated prices of hypothetical options that represent the projected changes in the Index over the full Term. The mathematical model we use to price those options is described in the Option Prices section of this prospectus.
Net Option Price for Downside Participation Rate with Cap Strategy
For Downside Participation Rate with Cap Strategy, three option prices are included in the calculation of the Net Option Price.
| ATM Call Option Price, which represents the possible rise in the Index |
| OTM Call Option Price, which is subtracted in order to limit any rise in the Index by the Cap |
| ATM Put Option Price, which represents the possible fall in the Index and is multiplied by the Downside Participation Rate in order to reflect your share in any such fall. |
The Net Option Price as of a Market Close is a percentage equal to: (1) the ATM Call Option Price for the Market Close; minus (2) the OTM Call Option Price for the Market Close; and (3) minus the ATM Put Option Price for the Market Close multiplied by the Downside Participation Rate.
It is important to note that the Net Option Price will almost always be less than any rise in the Index because, when we calculate the Net Option Price, we subtract the ATM Put Option Price, and the ATM Put Option Price is always above zero due to the constant present potential for a fall in the Index before the end of the Term.
Net Option Price for Downside Participation Rate with Upside Participation Rate Strategy
For a Downside Participation Rate with Upside Participation Rate Strategy, two option prices are included in the calculation of the Net Option Price.
| ATM Call Option Price, which represents the possible rise in the Index and is multiplied by the Upside Participation Rate in order to reflect your share in any such rise |
| ATM Put Option Price, which represents the possible fall in the Index and is multiplied by the Downside Participation Rate in order to reflect your share in any such fall. |
The Net Option Price as of a Market Close is a percentage equal to: (1) the ATM Call Option Price for the Market Close multiplied by the Upside Participation Rate; minus (2) the ATM Put Option Price for the Market Close multiplied by the Downside Participation Rate
It is important to note that the Net Option Price will almost always be less than any rise in the Index because, when we calculate the Net Option Price, we subtract the ATM Put Option Price, and the ATM Put Option Price is always above zero due to the constant present potential for a fall in the Index before the end of the Term.
38
Net Option Price for Buffer with Upside Participation Rate Strategy
For a Buffer with Upside Participation Rate Strategy, two option prices are included in the calculation of the Net Option Price.
| ATM Call Option Price, which represents the possible rise in the Index and is multiplied by the Upside Participation Rate in order to reflect your share in any such rise |
| OTM Put Option Price, which represents the possible fall in the Index and is limited by the Buffer in order to reflect your share in any such fall. |
The Net Option Price as of a Market Close is a percentage equal to: (1) the ATM Call Option Price for the Market Close multiplied by the Upside Participation Rate; minus (2) the OTM Put Option Price for the Market Close
It is important to note that the Net Option Price will almost always be less than any rise in the Index because, when we calculate the Net Option Price, we subtract the OTM Put Option Price, and the OTM Put Option Price is always above zero due to the constant present potential for a fall in the Index before the end of the Term.
Net Option Price for a Floor with Cap Strategy
For a Floor with Cap Strategy, four option prices are included in the calculation of the Net Option Price.
| ATM Call Option Price, which represents the possible rise in the Index |
OTM Call Option Price, which is subtracted in order to limit any rise in the Index by the Cap
ATM Put Option Price, which is subtracted to represent the possible fall in the Index; and
| OTM Put Option Price, which is added to limit any fall in the Index to the Floor. |
The Net Option Price as of a Market Close is a percentage equal to: (1) the ATM Call Option Price for the Market Close; minus (2) the OTM Call Option Price for the Market Close; minus (3) the ATM Put Option Price for the Market Close; and plus (4) the OTM Put Option Price for the Market Close.
It is important to note that the Net Option Price will almost always be less than any rise in the Index because, when we calculate the Net Option Price, we subtract the amount by which the ATM Put Option Price exceeds the OTM Put Option Price, and the ATM Put Option Price always exceeds the OTM Put Option Price because the ATM Put Option Price represents the constant present potential for a fall in the Index before the end of the Term, while the OTM Put Option Price represents the lesser/included potential for a change in the Index of more than the -10% Floor..
Net Option Price for Buffer with Cap Strategy
For a Buffer with Cap Strategy, three option prices are included in the calculation of the Net Option Price.
| ATM Call Option Price, which represents the possible rise in the Index |
OTM Call Option Price, which is subtracted in order to limit any rise in the Index by the Cap
| OTM Put Option Price, which represents the possible fall in the Index and is limited by the Buffer in order to reflect your share in any such fall. |
The Net Option Price as of a Market Close is a percentage equal to: (1) the ATM Call Option Price for the Market Close; minus (2) the OTM Call Option Price for the Market Close; and minus (3) the OTM Put Option Price for the Market Close
It is important to note that the Net Option Price will almost always be less than any rise in the Index because, when we calculate the Net Option Price, we subtract the OTM Put Option Price, and the OTM Put Option Price is always above zero due to the constant present potential for a fall in the Index before the end of the Term.
Amortized Option Cost
The Amortized Option Cost is one part of the Daily Value Percentage. The Amortized Option Cost starts with the Net Option Price at the beginning of a Term, which is calculated using the formulas set out above. That Net Option Price is then multiplied by the time remaining in the Term as a percentage of the length of the Term.
39
The Amortized Option Cost as of a Market Close is a percentage equal to: (1) the Net Option Price for the Strategy at the beginning of the Term; multiplied by (2) the number of days remaining until the final Market Close of the Term divided by 365 for a one-year Term, by 730 for a two-year Term, or by 2,192 days for a six-year Term.
Trading Cost
The Trading Cost is one part of the Daily Value Percentage. The Trading Cost as of a Market Close is the estimated cost of selling the hypothetical options before the end of a Term. It is a percentage that reflects the average market difference between option average bid-ask prices and option bid prices.
Daily Value Percentage Examples
Examples. Here are four examples that show how the Daily Value Percentage formula works for Indexed Strategies with a 1-year Term. In each example, we calculate the Daily Value Percentage for the Market Close on day 90 of a one-year Term.
Assumptions
Option Price Assumptions | Price at Start of Term |
Price at Current Market Close |
||||||||||
ATM Call Option Price |
6.00 | % | 7.47 | % | ||||||||
OTM Call Option Price |
1.15 | % | 1.81 | % | ||||||||
ATM Put Option Price |
5.40 | % | 3.36 | % | ||||||||
OTM Put Option Price |
4.50 | % | 2.80 | % | ||||||||
Strategy Assumptions |
||||||||||||
Investment Base for each Strategy (after taking Daily Charges into account) |
$ | 100,000 | ||||||||||
Cap |
11 | % | ||||||||||
Upside Participation Rate |
75 | % | ||||||||||
Days remaining to last Market Day of Term |
275 | |||||||||||
Trading Cost Assumption |
0.15 | % |
Example 1: 50% Downside Participation Rate with Cap Strategy
Current ATM Call Option Price Current OTM Call Option Price |
5.66 | % | (7.47% 1.81%) | |||
Current ATM Put Option Price x Downside Participation Rate |
1.68 | % | (50% of 3.36%) | |||
|
|
|||||
Net Option Price |
= 3.98 | % | ||||
Initial ATM Call Option Price Initial OTM Call Option Price |
4.85 | % | (6.00% 1.15%) | |||
Initial ATM Put Option Price x Downside Participation Rate |
2.70 | % | (50% of 5.40%) | |||
|
|
|||||
Net Option Cost |
= 2.15 | % | ||||
Amortization Factor for days remaining to final Market Day of Term |
x 75.34 | % | (275 / 365) | |||
|
|
|||||
Amortized Option Cost |
= 1.62 | % | ||||
Net Option Price |
3.98 | % | ||||
Amortized Option Cost |
1.62 | % | ||||
Assumed Trading Cost |
0.15 | % | ||||
|
|
|||||
Daily Value Percentage |
= 2.21 | % | ||||
Dollar amount of increase |
$ | 2,210 | ($100,000 x 2.21%) | |||
Value of 50% Downside Participation Rate with Cap Strategy |
$ | 102,210 | ($100,000 + $2,210) |
40
Example 2: 50% Downside Participation Rate with Upside Participation Rate Strategy
Current ATM Call Option Price x Upside Participation Rate |
5.60 | % | (75% of 7.47%) | |||
Current ATM Put Option Price x Downside Participation Rate |
1.68 | % | (50% of 3.36%) | |||
|
|
|||||
Net Option Price |
= 3.92 | % | ||||
Initial ATM Call Option Price x Upside Participation Rate |
4.50 | % | (75% of 6.00%) | |||
Initial ATM Put Option Price x Downside Participation Rate |
2.70 | % | (50% of 5.40%) | |||
Net Option Cost |
= 1.80 | % | ||||
Amortization Factor for days remaining to final Market Day of Term |
x 75.34 | % | (275 / 365) | |||
|
|
|||||
Amortized Option Cost |
1.36 | % | ||||
Net Option Price |
3.92 | % | ||||
Amortized Option Cost |
1.36 | % | ||||
Assumed Trading Cost |
0.15 | % | ||||
|
|
|||||
Daily Value Percentage |
= 2.41 | % | ||||
|
|
|||||
Increase as a dollar amount |
$ | 2,410 | ($100,000 x 2.41%) | |||
Value of 50% Downside Participation Rate with Upside Participation Rate Strategy |
$ | 102,410 | ($100,000 + $2,410) |
Example 3: 10% Buffer with Cap Strategy
Current ATM Call Option Price Current OTM Call Option Price |
5.66 | % | (7.47% -1.81%) | |||
Current OTM Put Option Price |
2.80 | % | ||||
|
|
|||||
Net Option Price |
= 2.86 | % | ||||
Initial ATM Call Option Price Initial OTM Call Option Price |
4.85 | % | (6.00% -1.15%) | |||
Initial OTM Put Option Price |
4.50 | % | ||||
Net Option Cost |
= 0.35 | % | ||||
Amortization Factor for days remaining to final Market Day of Term |
x 75.34 | % | (275 / 365) | |||
|
|
|||||
Amortized Option Cost |
0.26 | % | ||||
Net Option Price |
2.86 | % | ||||
Amortized Option Cost |
0.26 | % | ||||
Assumed Trading Cost |
0.15 | % | ||||
|
|
|||||
Daily Value Percentage |
= 2.45 | % | ||||
|
|
|||||
Increase as a dollar amount |
$ | 2,450 | ($100,000 x 2.45%) | |||
Value of 10% Buffer with Cap Strategy |
$ | 102,450 | ($100,000 + $2,450) |
Example 4: -10% Floor with Cap Strategy
Current ATM Call Option Price Current OTM Call Option Price |
5.66 | % | (7.47% 1.81%) | |||
(Current ATM Put Option Price Current OTM Put Option Price) |
-0.56 | % | (3.36% - 2.80%) | |||
|
|
|||||
Net Option Price |
= 5.10 | % | ||||
Initial ATM Call Option Price Initial OTM Call Option Price |
4.85 | % | (6.00% 1.15%) | |||
- (Initial ATM Put Option Price Initial OTM Put Option Price) |
0.90 | % | (5.40% - 4.50%) | |||
|
|
|||||
Net Option Cost |
= 3.95 | % | ||||
X Amortization Factor for days remaining to final Market Day of Term |
x 75.34 | % | (275 / 365) | |||
|
|
|||||
Amortized Option Cost |
= 2.98 | % | ||||
Net Option Price |
5.10 | % | ||||
Amortized Option Cost |
2.98 | % | ||||
Assumed Trading Cost |
0.15 | % | ||||
|
|
|||||
Daily Value Percentage |
= 1.97 | % | ||||
Dollar amount of increase |
$ | 1,970 | ($100,000 x 1.970%) | |||
Value of -10% Floor with Cap Strategy |
$ | 101,970 | ($100,000 + $1,970) |
Examples. Here is an example that shows how the Daily Value Percentage formula works with a six-year 10% Buffer with Upside Participation Rate Strategy. In this example, we calculate the Daily Value Percentage for the Market Close on day 2010 of a six-year Term.
41
Assumptions for Example 5
Option Price Assumptions | Price at Start of Term |
Price at Current Market Close |
||||||||||
ATM Call Option Price |
20.59 | % | 18.04 | % | ||||||||
OTM Put Option Price |
15.47 | % | 16.35 | % | ||||||||
Strategy Assumptions |
||||||||||||
Investment Base for each Strategy (after taking Daily Charges into account) |
$ | 100,000 | ||||||||||
Upside Participation Rate for six-year Term |
130 | % | ||||||||||
Days remaining to last Market Day of six-year Term |
182 | |||||||||||
Trading Cost Assumption |
2.03 | % |
Example 5: 10% Buffer with Upside Participation Rate Strategy
Current ATM Call Option Price x Upside Participation Rate |
23.45 | % | (130% of 18.04%) | |||
Current OTM Put Option Price |
16.35 | % | ||||
|
|
|||||
Net Option Price |
= 7.10 | % | ||||
Initial ATM Call Option Price x Upside Participation Rate |
26.77 | % | (130% of 20.59%) | |||
Initial OTM Put Option Price |
15.47 | % | ||||
Net Option Cost |
= 11.30 | % | ||||
Amortization Factor for days remaining to final Market Day of Term |
x 8.30 | % | (182 / 2192) | |||
|
|
|||||
Amortized Option Cost |
0.94 | % | ||||
Net Option Price |
7.10 | % | ||||
Amortized Option Cost |
0.94 | % | ||||
Assumed Trading Cost |
2.03 | % | ||||
|
|
|||||
Daily Value Percentage |
= 4.13 | % | ||||
|
|
|||||
Increase as a dollar amount |
$ | 4,130 | ($100,000 x 4.13%) | |||
Value of 10% Buffer with Upside Participation Rate Strategy |
$ | 104,130 | ($100,000 + $4,130) |
42
Maximum Loss Before the End of a Term
If you Surrender your Contract or take a withdrawal before the end of a Term, there is no set maximum loss because the Indexed Strategy value is determined using the Daily Value Percentage. The loss on a Floor Strategy may exceed the Floor, the loss on a Downside Participation Rate Strategy may exceed the 50% Downside Participation Rate, and a Buffer Strategy may not receive the benefit of the 10% Buffer, because the use of the Daily Value Percentage means that the Amortized Option Cost and Trading Cost are subtracted from the Strategy value. The Amortized Option Cost and Trading Cost are determined each time the Daily Value Percentage is calculated. As a result, in extreme circumstances, the total loss for an Indexed Strategy could be 100%, meaning that you would suffer a complete loss of your principal and any prior earnings.
INDEXED STRATEGY VALUE AFTER PERFORMANCE LOCK ELECTION
For an S&P 500 Strategy or a First Trust Barclays Edge Strategy, you may make a Performance Lock election for a Term that starts after the date of this prospectus, If you do so, then the normal rules described in the Indexed Strategy Value at End of Term section and the Indexed Strategy Value Before End of Term section do not apply. Instead, beginning on the second Market Close following the receipt of the Performance Lock election, the Daily Value Percentage used to calculate the Strategy value through the end of the Term is locked in. However, the Daily Charge will continue to be assessed against the Investment Base. Note: A Performance Lock election is not available for Contracts issued in Missouri.
If you make a Performance Lock election, here are the formulas that we use to calculate the Strategy value through the end of the Term.
Strategy value before or at end of Term = Investment Base + dollar amount of increase or decrease
Dollar amount of increase or decrease = Investment Base x locked Daily Value Percentage
Locked Daily Value Percentage = Net Option Price Amortized Option Cost Trading Cost, all as determined at the second Market Close following receipt of the Performance Lock election
Performance Lock Examples
Examples. Here are four examples that show how the Performance Lock election works for S&P 500 or First Trust Barclays Edge Strategies.
Assumptions
Option Price Assumptions |
Price at Start of Term | Price on Lock Effective Date |
||||||
ATM Call Option Price |
6.00 | % | 7.47 | % | ||||
OTM Call Option Price |
1.15 | % | 1.81 | % | ||||
ATM Put Option Price |
5.40 | % | 3.36 | % | ||||
OTM Put Option Price |
4.50 | % | 2.80 | % |
Strategy Assumptions |
||||
Initial Investment Base for each Strategy (after taking Daily Charges into account) |
$ | 100,000 | ||
Cap for one-year Term |
11 | % |
Upside Participation Rate for six-year Term |
130 | % | ||||||
Days remaining to last Market Day of six-year Term |
182 | |||||||
Trading Cost Assumption |
2.03 | % |
43
Example 1: 50% Downside Participation Rate with Cap Strategy
Lock effective date ATM Call Option Price OTM Call Option Price |
5.66 | % | (7.47% 1.81%) | |||
(Lock effective date ATM Put Option Price x Downside Participation Rate) |
1.68 | % | (50% of 3.36%) | |||
Net Option Price on Lock effective date |
= 3.98 | % | ||||
Initial ATM Call Option Price Initial OTM Call Option Price |
4.85 | % | (6.00% 1.15%) | |||
(Initial ATM Put Option Price x Downside Participation Rate) |
2.70 | % | (50% of 5.40%) | |||
Net Option Cost |
= 2.15 | % | ||||
Amortization Factor for days remaining from Lock effective date to final Market Day of Term |
x 75.34 | % | (275 / 365) | |||
Amortized Option Cost on Lock effective date |
= 1.62 | % | ||||
Net Option Price |
3.98 | % | ||||
Amortized Option Cost |
1.62 | % | ||||
Assumed Trading Cost |
0.15 | % | ||||
Locked Daily Value Percentage |
= 2.21 | % | ||||
Dollar amount of increase at Term end |
$ | 2,210 | ($100,000 x 2.21%) | |||
Value of 50% Downside Participation Rate with Cap Strategy at Term end |
$ | 102,210 | ($100,000 + $2,210) |
Example 2: 50% Downside Participation Rate with Upside Participation Rate Strategy
Lock effective date ATM Call Option Price x Upside Participation Rate |
5.60 | % | (75% of 7.47%) | |||
(Lock effective date ATM Put Option Price x Downside Participation Rate) |
1.68 | % | (50% of 3.36%) | |||
Net Option Price on Lock Effective Date |
= 3.92 | % | ||||
Initial ATM Call Option Price x Upside Participation Rate |
4.50 | % | (75% of 6.00%) | |||
(Initial ATM Put Option Price x Downside Participation Rate) |
2.70 | % | (50% of 5.40%) | |||
Net Option Cost |
= 1.80 | % | ||||
Amortization Factor for days remaining to final Market Day of Term |
x 75.34 | % | (275 / 365) | |||
Amortized Option Cost on Lock effective date |
1.36 | % | ||||
Net Option Price |
3.92 | % | ||||
Amortized Option Cost |
1.36 | % | ||||
Assumed Trading Cost |
0.15 | % | ||||
Locked Daily Value Percentage |
= 2.41 | % | ||||
Increase as a dollar amount as Term end |
$ | 2,410 | ($100,000 x 2.41%) | |||
Value of 50% Downside Participation Rate with Upside Participation Rate Strategy at Term end |
$ | 102,410 | ($100,000 + $2,410) |
Example 3: 10% Buffer with Cap Strategy
Lock effective date ATM Call Option Price OTM Call Option Price |
5.66 | % | (7.47%-1.81%) | |||
Lock effective date OTM Put Option Price |
2.80 | % | ||||
Net Option Price on Lock effective date |
= 2.86 | % | ||||
Initial ATM Call Option Price Initial OTM Call Option Price |
4.85 | % | (6.00%-1.15%) | |||
Initial OTM Put Option Price |
4.50 | % | ||||
Net Option Cost |
= 0.35 | % | ||||
Amortization Factor for days remaining from Lock effective date to final Market Day of Term |
x 75.34 | % | (275 / 365) |
44
Amortized Option Cost on Lock effective date |
0.26 | % | ||||||
Net Option Price |
2.86 | % | ||||||
Amortized Option Cost |
0.26 | % | ||||||
Assumed Trading Cost |
0.15 | % | ||||||
Locked Daily Value Percentage |
= 2.45 | % | ||||||
|
|
|||||||
Dollar amount of increase at Term end |
$ | 2,450 | ($100,000 x 2.45%) | |||||
Value of 10% Buffer with Cap Strategy at Term end |
$ | 102,450 | ($100,000 + $2,450) |
Example 4: -10% Floor with Cap Strategy
Lock effective date ATM Call Option Price OTM Call Option Price |
5.66 | % | (7.47% 1.81%) | |||
(Lock effective date ATM Put Option Price OTM Put Option Price) |
0.56 | % | (3.36% 2.80%) | |||
Net Option Price on Lock effective date |
= 5.10 | % | ||||
Initial ATM Call Option Price Initial OTM Call Option Price |
4.85 | % | (6.00% 1.15%) | |||
- (Initial ATM Put Option Price Initial OTM Put Option Price) |
0.90 | % | (5.40% - 4.50%) | |||
Net Option Cost |
= 3.95 | % | ||||
Amortization Factor for days remaining from Lock effective date to final Market Day of Term |
x 75.34 | % | (275 / 365) | |||
Amortized Option Cost on Lock effective date |
= 2.98 | % | ||||
Net Option Price |
5.10 | % | ||||
Amortized Option Cost |
2.98 | % | ||||
Assumed Trading Cost |
0.15 | % | ||||
Locked Daily Value Percentage |
= 1.97 | % | ||||
Dollar amount of increase at Terme end |
$ | 1,970 | ($100,000 x 1.970%) | |||
Value of -10% Floor with Cap Strategy at Term end |
$ | 101,970 | ($100,000 + $1,970) |
Examples. Here is an example that shows how the Performance Lock election works with a six-year 10% Buffer with Upside Participation Rate Strategy. In this example, we assume that the Performance Lock election is effective on day 2010 of a six-year Term.
Assumptions for Example 5
Option Price Assumptions | Price at Start of Term |
Price on Lock Effective Date |
||||||||||
ATM Call Option Price |
20.59 | % | 18.04 | % | ||||||||
OTM Put Option Price |
15.47 | % | 16.35 | % | ||||||||
Strategy Assumptions |
||||||||||||
Investment Base for each Strategy (after taking Daily Charges into account) |
$ | 100,000 | ||||||||||
Upside Participation Rate for six-year Term |
130 | % | ||||||||||
Days remaining to last Market Day of six-year Term |
182 | |||||||||||
Trading Cost Assumption |
2.03 | % |
Example 5: 10% Buffer with Upside Participation Rate Indexed Strategy
Lock Effective Date ATM Call Option Price x Upside Participation Rate |
23.45 | % | (130% of 18.04%) | |||
Lock Effective Date OTM Put Option Price |
16.35 | % | ||||
|
|
|||||
Net Option Price on Lock effective date |
= 7.10 | % | ||||
Initial ATM Call Option Price x Upside Participation Rate |
26.77 | % | (130% of 20.59%) | |||
Initial OTM Put Option Price |
15.47 | % | ||||
Net Option Cost |
= 11.30 | % | ||||
Amortization Factor for days remaining from Lock effective date to final Market Day of Term |
x 8.30 | % | (182 / 2192) | |||
|
|
45
Amortized Option Cost on Lock effective date |
0.94 | % | ||||
Net Option Price |
7.10 | % | ||||
Amortized Option Cost |
0.94 | % | ||||
Assumed Trading Cost |
2.03 | % | ||||
|
|
|||||
Locked Daily Value Percentage |
= 4.13 | % | ||||
|
|
|||||
Increase as a dollar amount at Term end |
$ | 4,130 | ($100,000 x 4.13%) | |||
Value of 10% Buffer with Upside Participation Rate Strategy at Term end |
$ | 104,130 | ($100,000 + $4,130) |
You may purchase a Contract only through a registered representative of a broker-dealer that has a selling agreement with our affiliated underwriter, MM Ascend Life Investor Services, LLC.
Any Owner or Annuitant must be age 80 or younger on the Contract Effective Date. To determine eligibility, we will use the persons age on his/her last birthday. We may make exceptions with respect to the maximum issue age in our discretion.
The Contract is not available in all states. To find out if it is available in the state where you live, ask your registered representative. The Contract may not be available for purchase during certain periods. There are a number of reasons why the Contract periodically may not be available, including that we want to limit the volume of sales of the Contract. You may wish to speak to your registered representative about how this may affect your purchase. For example, in order to purchase the Contract, you may be required to submit your application prior to a specific date. In that case, if there is a delay because your application is incomplete or otherwise not in good order, you might not be able to purchase the Contract. Your broker-dealer may impose conditions on the purchase of the Contract, such as a lower maximum issue age, than we or other selling firms impose. We reserve the right to reject any application at our discretion. We also reserve the right to discontinue the sale of the Contracts at any time.
Purchase Payments
The Contract is a modified single premium annuity contract. This means you may make one or more Purchase Payments during the purchase payment period. The purchase payment period begins on the Contract Effective Date. It will end two months after the Contract Effective Date.
We must receive your initial Purchase Payment on or before the Contract Effective Date. We must receive each additional Purchase Payment on or before the last day of the purchase payment period. We will not accept any Purchase Payment that we receive after the date that the Contract is cancelled or Surrendered or after a death for which a Death Benefit is payable.
The initial Purchase Payment must be at least $25,000. Each additional Purchase Payment must be at least $10,000. You will need our prior approval if you want to make a Purchase Payment(s) of more than $1,000,000.
We reserve the right to refuse a Purchase Payment made in the form of a personal check in excess of $100,000. We may accept a Purchase Payment over $100,000 made in other forms, such as EFT/wire transfers, or certified checks or other checks written by financial institutions. We will not accept a Purchase Payment(s) made with cash, money orders, or travelers checks.
Exchanges, Transfers, or Rollovers
If you own an annuity or tax-qualified account, you may be able to exchange it for an Index Summit 6 Pro annuity, directly transfer it to an Index Summit 6 Pro annuity, or roll it over to an Index Summit 6 Pro annuity without paying taxes. Before you do, compare the benefits, features, and costs of each annuity or account. You may pay an early withdrawal charge under the old annuity or account. You may pay an early withdrawal charge if you later take withdrawals from your Index Summit 6 Pro annuity. Please note that some financial professionals may have a financial incentive to offer this Contract in place of the one the investor already owns. Ask your registered representative whether an exchange, transfer, or rollover would be advantageous, based on the features, benefits, and charges of the Index Summit 6 Pro annuity.
If you purchase your Contract with an exchange, transfer, or rollover, a delay in processing the exchange, transfer, or rollover may delay the issuance of your new Contract or prevent the application of additional Purchase Payments to your existing Contract.
You should only exchange your existing contract for this Contract if you determine after comparing the features, fees, and risks of both contracts that it is preferable for you to purchase this Contract rather than continuing to own your existing contract.
46
Application of Purchase Payments
Each Purchase Payment will be held in the Purchase Payment Account until it is applied to an Indexed Strategy on a Strategy Application Date. On each Strategy Application Date, we will apply the then current balance of the Purchase Payment Account to the Indexed Strategies you selected. We will credit interest daily on amounts held in the Purchase Payment Account at the annual effective rate set out in your Contract. This rate will be at least 1%.
In certain states, we are required to give back your Purchase Payment(s) if you decide to cancel your Contract during the free look period. If we are required by law to refund your Purchase Payment(s), we reserve the right to hold your Purchase Payment(s) in the Purchase Payment Account until the first Strategy Application Date on or after the end of the free look period. If we do so and you cancel your Contract before that Strategy Application Date, we will refund your Purchase Payment(s) but you will forfeit any interest credited to the Purchase Payment Account.
Purchase Payment Account Value
On any day, the value of the Purchase Payment Account is equal to:
| Purchase Payments received by us plus interest earned daily; minus |
| the premium tax or other tax that may apply to the Purchase Payments; and minus |
| each withdrawal and related Early Withdrawal Charge taken from the Purchase Payment Account since the last Strategy Application Date. |
Unforeseen Processing Delays
We are exposed to risks related to natural and man-made disasters and catastrophes, such as (but not limited to) storms, fires, floods, earthquakes, public health crises, malicious acts, and terrorist acts, any of which could adversely affect our ability to conduct business. A natural or man-made disaster or catastrophe, including a pandemic (such as COVID-19), could affect the ability or willingness of our employees or the employees of our service providers to perform their job responsibilities. While many of our employees and the employees of our service providers are able to work remotely, those remote work arrangements may result in our business operations being less efficient than under normal circumstances and could lead to delays in our processing of contract-related transactions, including orders from contract owners. Catastrophic events may negatively affect the computer and other systems on which we rely, impact our ability to calculate values under your Contract, or have other possible negative impacts. There can be no assurance that our service providers will be able to successfully avoid negative impacts associated with natural and man-made disasters and catastrophes.
A processing delay will not affect the effective date as of which we process transactions, including orders from contract owners, the date that a Term begins or ends, or the values used to process the transaction.
You make your initial selection of Indexed Strategies in your purchase application. Your initial selection is set out on your Contract Specifications Page.
Your initial selection will also apply to each subsequent Purchase Payment. If you wish to change your selection for a specific Purchase Payment, we must receive a Request in Good Order that identifies the Indexed Strategies you are selecting for that Purchase Payment before the Strategy Application Date that applies to that Purchase Payment.
When you select an Indexed Strategy, you must also indicate the percentage of the Purchase Payment that you wish to allocate to that Indexed Strategy. All allocations must be in whole percentages that total 100%. We reserve the right to round amounts up or down to make whole percentages, and to reduce or increase amounts proportionally in order to total 100%.
Currently there are no limitations on the amounts that may be applied to an Indexed Strategy.
The S&P 500 6-year 10% Buffer with Upside Participation Rate Strategy is only be available for Terms that begin in the first Contract Year.
We may establish minimum and maximum amounts or percentages that may be applied to a given Indexed Strategy for any future Term in our discretion. We will notify you of any such minimum or maximum. We may limit the availability of a Strategy for a Term that would extend beyond the Annuity Payout Initiation Date. All Strategies may not be available in all states.
47
STRATEGY SELECTIONS AT TERM END
At the end of a Term, you may choose to reallocate your money among the Indexed Strategies or you may choose to take no action. If you do not send us a reallocation request, your current allocations will automatically continue in the new Term as long as the same Index Strategies are available.
Reallocations
At the end of a Term, you may reallocate the ending values of the Indexed Strategies for that Term among the available Strategies. You can only reallocate amounts from one Indexed Strategy to another at the end of the Term for which such amount is being held. You cannot make a reallocation at any other time.
We will send you written notice at least 30 days before the end of a Term to provide you with the opportunity to make a reallocation. We must receive your Request in Good Order for a reallocation on or before the last day of the Term. For example, if the end of a Term falls on a weekend, we must receive your request on the last Market Day before that weekend.
Continuing Allocations
You do not need to take any action if you want to continue your current allocations and all of your strategies are available for the next Term. If you do not send us a reallocation request, then we will automatically apply the ending value of each Indexed Strategy to a new Term of that same Strategy.
Unavailable Strategies
Other than the S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate Indexed Strategy, an Indexed Strategy may be unavailable for the next Term because we are no longer offering that Strategy or we have set a minimum or maximum for that Strategy. The S&P 500 6-year 10% Buffer with Upside Participation Rate will not be available for Terms that begin after the first Contract Year.
When an Indexed Strategy is unavailable for the next Term, you may choose to reallocate the funds held in that Strategy.
If you take no action and do not send us a reallocation request, then any amount that cannot be applied to that Indexed Strategy for the next Term will be applied as follows:
1) | if the Strategy is a Downside Participation Rate Strategy, to another Indexed Strategy that uses the same index as the prior Indexed Strategy, has a Term that is no longer than the prior Indexed Strategy, has a Downside Participation Rate that is no greater than the prior Indexed Strategy, and has the same or most comparable positive return factors; or |
2) | if the Strategy is a Floor Strategy, to another Indexed Strategy that uses the same index as the prior Indexed Strategy, has a Term that is no longer than the prior Indexed Strategy, has a Floor that is no more negative than the prior Indexed Strategy, and has the same or most comparable positive return factors; or |
3) | if the Strategy is a Buffer Strategy, to another Indexed Strategy that uses the same index as the prior Indexed Strategy, has a Term that is no longer than the prior Indexed Strategy, has a Buffer that is at least as large as the prior Indexed Strategy, and has the same or most comparable positive return factors; or |
4) | to the S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate Indexed Strategy. |
Surrender or Withdrawal at Term End
At the end of a Term, you may choose to Surrender your Contract or to take a withdrawal from your Contract. You may do so for any reason, including dissatisfaction with the available Indexed Strategies. An Early Withdrawal Charge may apply. In addition, there may be tax consequences if you Surrender your Contract or take a withdrawal. You should seek advice on tax questions based on your particular circumstances from a tax advisor.
Contract values calculated at the end of a Term will reflect the applicable Strategy values and any Early Withdrawal Charge that applies upon Surrender or to your withdrawal. The value of an Indexed Strategy at the end of the Term will not reflect any Daily Value Percentage because it is calculated based on the rise or fall of the applicable Index over the Term.
Limitations
Reallocations must be in whole percentages that total 100%. We reserve the right to round amounts up or down to make whole percentages, and to reduce or increase amounts proportionally in order to total 100%.
Any reallocation or continuing allocation will be subject to Strategy availability, minimums and maximums. Currently there are no limitations on the amounts that may be applied to any single Indexed Strategy. We may establish minimum and maximum amounts or percentages that may be applied to a given Indexed Strategy for any future Term in our discretion. We will notify you of any such minimum or maximum.
48
The new Term of each Strategy is subject to the Cap or Upside Participation Rate in effect for that Strategy for that new Term. For example, the Upside Participation Rate for an Indexed Strategy for a new Term may be different than the Upside Participation Rate for that Indexed Strategy for the Term that is ending. The Downside Participation Rate, Floor or Buffer will not change from Term to Term.
Availability of Strategies
We will send you a written notice at least 30 days before the end of each Term with information about the Strategies that will be available for the next Term. At least 10 days before the next Term starts, we will post the Caps and Upside Participation Rates that will apply for the next Term on our website (www.mmascend.com/RILArates).
The S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate Indexed Strategy will always be available. We are not obligated to offer any other particular Indexed Strategy. At the end of a Term, we can add or stop offering any other Indexed Strategy at our discretion. We reserve the right to limit the availability of any other Indexed Strategy for a Term that would extend beyond the Annuity Payout Initiation Date. All Indexed Strategies may not be available in all states.
If we intend to add or stop offering an Indexed Strategy at the end of a Term, we will send you a notification at least 30 days before the end of the Term to provide you with the opportunity to make a reallocation. If funds are held in an Indexed Strategy that will no longer be available after the end of a Term, the funds will remain in that Strategy until the end of that Term.
Default Strategy
At the end of a Term of a 1-year or 2-year Strategy, to the extent any amount cannot be applied to a given Indexed Strategy for the next Term because that Strategy is no longer available or the amount is under the minimum or over the maximum for that Strategy for the new Term, we will apply the amount to the default Strategy unless you send us a request to reallocate that amount. The default Strategy will be the S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate Indexed Strategy. For example, if a given Indexed Strategy with an ending value of $73,000 is no longer available, we will apply the $73,000 to the default Strategy for the next Term unless you send us a request to reallocate that $73,000. At the end of a Term of the 6-year Buffer Strategy, we will apply the amount to the S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy unless you send us a request to reallocate that amount.
If the amount to be applied exceeds the maximum, then only the excess amount will be applied to the default Strategy. For example, if the maximum amount for an Indexed Strategy is $50,000 and the amount to be applied is $54,000, then we will apply the excess $4,000 to the default Strategy for the next Term unless you send us a request to reallocate that $4,000.
We must receive your Request in Good Order for a reallocation on or before the last day of the Term. For example, if the end of a Term falls on a weekend, we must receive your request on the last Market Day before that weekend.
Surrender
You may Surrender your Contract at any time before the earlier of: (1) the Annuity Payout Initiation Date; or (2) a death for which a Death Benefit is payable. The right to Surrender may be restricted if your Contract is purchased under an employer plan subject to IRC Section 401 (pension, profit sharing, and 401(k) plans), IRC Section 403(b) (tax-sheltered annuity plans), or IRC Section 457(b) (governmental deferred compensation plans).
A Surrender must be made by a Request in Good Order. The amount paid upon Surrender is the Surrender Value. If you Surrender your Contract, the Contract terminates.
Withdrawals
You may take a withdrawal from your Contract at any time before the earliest of: (1) the Annuity Payout Initiation Date; (2) a death for which a Death Benefit is payable; or (3) the date that this Contract is Surrendered. The right to withdraw may be restricted if your Contract is purchased under an employer plan subject to IRC Section 401 (pension, profit sharing, and 401(k) plans), IRC Section 403(b) (tax-sheltered annuity plans), or IRC Section 457(b) (governmental deferred compensation plans).
A withdrawal must be made by a Request in Good Order. The amount of any withdrawal must be at least $500. If the withdrawal would reduce the Account Value to less than the minimum value of $5,000, we will treat the withdrawal request as a request to withdraw the maximum amount that may be taken without reducing your Account Value to less than $5,000.
49
We will withdraw funds from your Account Value as of the date on which we receive your Request in Good Order or any later specified effective date. You may designate the Indexed Strategy or Strategies from which a withdrawal will be taken by a Request in Good Order prior to the date of the withdrawal. If you do not make a designation, we will take the withdrawal from the Indexed Strategies in the following order:
| first from the Purchase Payment Account; and |
| then proportionally from Indexed Strategies having the shortest Term. |
For Contracts issued in Missouri, amounts taken from Indexed Strategies will be proportional without regard to Term length.
Effect of Withdrawals
A withdrawal reduces the Account Value, which in turn reduces the amount payable upon Surrender, applied to the Annuity Payout Benefit, or payable as the Death Benefit.
If an Early Withdrawal Charge applies to your withdrawal, you will receive the amount that you requested, and your Account Value will be reduced by the amount you receive plus the amount needed to pay the Early Withdrawal Charge. A withdrawal from an Indexed Strategy other than at the end of a Term also reduces the Investment Base used to calculate the Strategy value later in the Term. The reduction in the Investment Base for a withdrawal and any related Early Withdrawal Charge is proportional to the reduction in the Strategy value.
Automatic Withdrawals
You may elect to automatically withdraw money from your Contract under any automatic withdrawal program that we offer. Your Account Value must be at least $10,000 in order to make an automatic withdrawal election. The minimum amount of each automatic withdrawal payment is $100. Automatic withdrawals will be taken from the Purchase Payment Account and Indexed Strategies of your Contract in the same order as any other withdrawal.
Subject to the terms and conditions of the automatic withdrawal program, you may begin or discontinue automatic withdrawals at any time. You must give us at least 30 days notice to change any automatic withdrawal instructions that are currently in place. Any request to begin, discontinue or change automatic withdrawals must be a Request in Good Order. We reserve the right to discontinue offering automatic withdrawals at any time.
Currently, we do not charge a fee to participate in an automatic withdrawal program. However, we reserve the right to impose an annual fee in such amount as we may then determine to be reasonable for participation in the automatic withdrawal program. If imposed, the fee will not exceed $30 annually.
Before electing an automatic withdrawal, you should consult with a financial advisor.
| Automatic withdrawals are similar to starting Annuity Payout Benefit payments, but will result in different taxation of payments and potentially a different amount of total payments over the life of your Contract. |
| Automatic withdrawals during a Term of an Indexed Strategy will systematically reduce the Investment Base, which will reduce any subsequent increase in the Strategy value due to a positive Daily Value Percentage during that Term or a rise in the applicable Index at the end of that Term. Such reductions could be significant. |
| Automatic withdrawals will reduce the amount available under the Free Withdrawal Allowance described below. |
| Unless a waiver applies, an Early Withdrawal Charge may apply to an automatic withdrawal during the Early Withdrawal Charge period. |
| The value of an Indexed Strategy on an automatic withdrawal date will reflect the Daily Value Percentage on that date. |
Exchanges, Transfers, and Rollovers
An amount paid on a withdrawal or Surrender may be paid to or for another annuity or tax-qualified account in a tax-free exchange, transfer, or rollover to the extent allowed by federal tax law.
AMORTIZED OPTION COST AND TRADING COST USED TO CALCULATE DAILY VALUE PERCENTAGE
The Daily Value Percentage is used to determine the value of an Indexed Strategy before the end of a Term, and a locked Daily Value Percentage is used to determine the value of an Indexed Strategy for the balance of a Term if you have made a Performance Lock election. The Daily Value Percentage is calculated by subtracting the Amortized Option Cost and Trading Cost from the Net Option Price. The Amortized Option Cost and Trading Cost are charges for unwinding the investment before the end of a Term. These charges reduce the Indexed Strategy value. When the Contract is Surrendered or a withdrawal is taken before the end of a Term, or when you make a Performance Lock election, the reduction in Indexed
50
Strategy value due to the Amortized Option Cost and Trading Cost may cause a loss to exceed the -10% Floor or 50% Downside Participation Rate, and may eliminate the benefit of the 10% Buffer. The Amortized Option Cost and Trading Cost are determined each time the Daily Value Percentage is calculated or when a Performance Lock election is made. As a result, in extreme circumstances, the total loss for an Indexed Strategy could be 100%, meaning that you would suffer a complete loss of your principal and any prior earnings. For more information on the Amortized Option Cost and Trading Cost, please see the Indexed Strategy Value Before End of Term section beginning on page [ ].
We impose a Daily Charge on each Indexed Strategy to reimburse us for contract sales expenses, including commissions and other distribution, promotion, and acquisition expenses, and to help us maximize Indexed Strategy Caps and Participation Rates. The Daily Charge is calculated using a daily rate that compounds at 0.75% per year.
The Daily Charge is calculated as a percentage of the remaining Investment Base of the Indexed Strategy and deducted daily.
We impose an Early Withdrawal Charge to reimburse us for contract sales expenses, including commissions and other distribution, promotion, and acquisition expenses, and to allow us to invest assets for a longer duration, which supports higher Caps and Upside Participation Rates.
The Early Withdrawal Charge applies if, during the first six Contract Years, you take a withdrawal from your Contract or Surrender it. After that, the Early Withdrawal Charge does not apply.
During the first six Contract Years, the Early Withdrawal Charge applies to each withdrawal, including withdrawals under an automatic withdrawal program and withdrawals taken to satisfy a required distribution. The Early Withdrawal Charge does not apply to Death Benefit payments or Annuity Payout Benefit payments.
An Early Withdrawal Charge reduces your Account Value.
The Early Withdrawal Charge is equal to the amount that is subject to the charge multiplied by the Early Withdrawal Charge rate.
| If you take a withdrawal from your Contract, the amount subject to the charge is the amount you withdraw, which includes any amount needed to pay the Early Withdrawal Charge. This means that at your direction either we will subtract the Early Withdrawal Charge from amount paid to you or we will increase the amount withdrawn as needed to cover the charge. |
| If you Surrender your Contract, the amount subject to the charge is your Account Value. |
| The amount subject to the charge will not include the Free Withdrawal Allowance or the amount, if any, that qualifies for a waiver as described below. |
The Early Withdrawal Charge rate depends on how long you own your Contract. The rate schedule is set out below.
Contract Year |
1 | 2 | 3 | 4 | 5 | 6 | 7+ | |||||||||||||||||||||
Early Withdrawal Charge Rate |
9 | % | 8 | % | 7 | % | 6 | % | 5 | % | 4 | % | 0 | % |
Example for Surrender. You Surrender your Contract in Contract Year 6 when your Account Value is $100,000. You have already used your Free Withdrawal Allowance for the year and no other exception applies. We take an Early Withdrawal Charge of $4,000 ($100,000 x 4%) and you receive $96,000.
Example for Withdrawal. You withdraw $12,000 from your Contract in Contract Year 6. You have already used your Free Withdrawal Allowance for the year and no other exception applies. We use the following formula to calculate the Early Withdrawal Charge.
(Requested withdrawal x EWC rate) / (1.00 - EWC rate) = Early Withdrawal Charge
($12,000 x 4%) / (1.00 - 0.04) = $480 / 0.96 = $500
We take the Early Withdrawal Charge of $500, you receive $12,000, and your Account Value is reduced by $12,500.
Note. If the amount subject to the Early Withdrawal Charge included only the amount you withdrew, the charge would have been $480. Because the amount subject to the Early Withdrawal charge also included the amount needed to pay the charge, the actual charge is $500.
51
Free Withdrawal Allowance
The Free Withdrawal Allowance lets you withdraw some money from your Contract without the imposition of the Early Withdrawal Charge. For the first Contract Year, the Free Withdrawal Allowance is an amount equal to 10% of the total Purchase Payments received by us. For each subsequent Contract Year, the Free Withdrawal Allowance is equal to 10% of the Account Value as of the most recent Contract Anniversary. The Free Withdrawal Allowance is non-cumulative and you may not carry over any unused portion to other Contract Years.
For qualified annuities, the Free Withdrawal Allowance will be large enough to cover your required minimum distribution to age 93. However, if you have used your Free Withdrawal Allowance to facilitate a transfer or rollover, then an Early Withdrawal Charge may apply to a required minimum distribution.
Example. Your Account Value as of the end of Contract Year 3 is $200,000. Your Free Withdrawal Allowance for Contract Year 4 is $20,000 (10% of $200,000). If you take a withdrawal of $50,000 at the beginning of Contract Year 4, the Early Withdrawal Charge will not apply to the first $20,000 of the withdrawal, but will apply to the remaining $30,000 plus the amount needed to pay the Early Withdrawal Charge. If you take another withdrawal later in Contract Year 4, the Early Withdrawal Charge applies to the entire withdrawal plus the amount needed to pay the Early Withdrawal Charge.
If you Surrender your Contract during the first six Contract Years, the amount subject to the Early Withdrawal Charge upon Surrender will not include the current or any prior Free Withdrawal Allowance.
Early Withdrawal Charge Waivers
Extended Care Waiver. (Rider form R1462316NW-Waiver of Early Withdrawal Charges for Extended Care Rider). We will waive the Early Withdrawal Charge that would otherwise apply if you make a Request in Good Order and:
| your Contract is modified by the Extended Care Waiver Rider; |
| you are confined in a long-term care facility or hospital and the confinement is prescribed by a physician and is medically necessary; |
| the first day of the confinement is at least one year after the Contract Effective Date; and |
| the confinement has continued for a period of at least 90 consecutive days. |
You must provide us with satisfactory proof that you meet these conditions before the date of the withdrawal or Surrender. There is no charge for this rider, but it may not be available in all states. (See the State Variations section on page [ ] for information about availability in your state.) You do not need to take any action to add this waiver rider. Before you request a waiver, carefully review the rider to ensure that you understand how it works.
Terminal Illness Waiver. (Rider form R1462416NW-Waiver of Early Withdrawal Charges Upon Terminal Illness Rider). We will waive the Early Withdrawal Charge that would otherwise apply if you make a Request in Good Order and:
| your Contract is modified by the Waiver of Early Withdrawal Charges upon Terminal Illness Rider; |
| you are diagnosed with a terminal illness by a physician and, as a result of the terminal illness, you have a life expectancy of less than 12 months from the date of diagnosis; and |
| the diagnosis is rendered by a physician more than one year after the Contract Effective Date. |
You must provide us with satisfactory proof that you meet these conditions before the date of the withdrawal or Surrender. There is no charge for this rider, but it may not be available in all states. (See the State Variations section below for information about availability in your state.) You do not need to take any action to add this waiver rider. Before you request a waiver, carefully review the rider to ensure that you understand how it works.
Automatic Withdrawal Program Charges
Currently, we do not charge a fee to participate in an automatic withdrawal program. However, we reserve the right to impose an annual fee in such amount as we may then determine to be reasonable for participation in the automatic withdrawal program. If imposed, the fee will not exceed $30 annually.
State Limitations. In some states, our ability to waive fees or charges may be limited by applicable laws, regulations or administrative positions.
Under the Contract you may receive regular Annuity Payout Benefit payments for the duration of the period that you select. Once Annuity Payout Benefit payments start, you can no longer Surrender the Contract or take a withdrawal, no Death Benefit will be payable under your Contract, and your Beneficiary designations will no longer apply. The amount payable after death, if any, is governed by the Payout Option you select.
The Annuity Payout Benefit is payable if the Annuity Payout Initiation Date is reached before the earlier of: (1) a death for which a Death Benefit is payable; or (2) the date that this Contract is Surrendered.
52
Annuity Payout Initiation Date
The Annuity Payout Initiation Date is the first day of the first payment interval for which payment of the Annuity Payout Benefit is to be made. Annuity Payout Benefit payments are made at the end of each payment interval. This means that for annual payments, the first payment will be made one year after the Annuity Payout Initiation Date.
You may select the Annuity Payout Initiation Date by a Request in Good Order. We must receive your request before the last Market Close on or before the Annuity Payout Initiation Date you selected and at least 30 days before the first Annuity Payout Benefit payment is to be made.
| The earliest Annuity Payout Initiation you may select is the first Contract Anniversary. |
| Unless we agree to a later date, the latest Annuity Payout Initiation Date you may select is the Contract Anniversary following your 95th birthday or the 95th birthday, of a joint owner, if earlier. If the Owner is not a human being such as a trust or a corporation, then the Annuity Payout Initiation Date may not be later than the Contract Anniversary following the 95th birthday of the eldest Annuitant, unless we agree to a later date. |
The earliest permitted date and the latest permitted date for the Annuity Payout Initiation Date are set out on your Contract Specifications Page. The latest permitted date may change if an Owner changes.
If you do not select an Annuity Payout Initiation Date by the latest permitted date, we may select it for you. We will notify you in writing at least 45 days before the date we select. We will give you an opportunity to select an earlier date.
Annuity Payout Amount
The amount of each payment under the Annuity Payout Benefit is determined on the Annuity Payout Initiation Date based on the Annuity Payout value on that date, the Payout Option that applies, and the payment interval.
The Annuity Payout value is the amount that can be applied to the Annuity Payout Benefit is equal to: (1) the Account Value on the Annuity Payout Initiation Date; minus (2) premium tax or other taxes not previously deducted. If the Annuity Payout value is determined on a date other than the end of the Term, the Annuity Payout value will be based on the Daily Value Percentage or the locked Daily Value Percentage if you have made a Performance Lock election. Please see the Indexed Strategy Value Before End of Term section on page [ ] or the Indexed Strategy Value After Performance Lock Election on page [ ] for more information.
Form of Annuity Payout Benefit
The Annuity Payout Benefit is paid in the form of annual payments as a Life Payout with Payments for at Least a Fixed Period. That fixed period will be 10 years or, if fewer, the maximum number of whole years permitted by any tax qualification endorsement.
In place of that, you may elect to have the Annuity Payout Benefit paid in any form of Payout Option that is available under your Contract. The available Payout Options are described in the Payout Options section on page [ ]. You may elect a Payout Option by a Request in Good Order. We must receive your request before the last Market Close on or before the Annuity Payout Initiation Date and at least 30 days before the first Annuity Payout Benefit payment is to be made.
Payee for Annuity Payout Benefit
Payment of the Annuity Payout Benefit generally is made to the surviving Owner(s) as the payee(s). In place of that, the surviving Owner(s) may elect for payment to be made as a tax-free exchange, transfer, or rollover, or for payment to be made to the Annuitant. That election must be made by a Request in Good Order that we receive at least 30 days before the payment date.
Payments that become due after the death of the payee are made to:
| the surviving Owner(s); or if none |
| then to the surviving contingent payee(s) designated by the surviving Owner(s); or if none; |
| the estate of the last payee who received payments. |
The portion of any Annuity Payout Benefit remaining after the death of an Owner or Annuitant must be paid at least as rapidly as payments were being made at the time of such death.
You may designate a contingent payee by a Request in Good Order. If you designate your spouse as a contingent payee and your marriage ends before your death, then we will treat your former spouse as having predeceased you except in the following situations: (1) if a court order provides that the former spouses rights as a contingent payee are to continue; or (2) if the former spouse remains or becomes an Owner.
53
A Death Benefit is payable under your Contract if you die before the Annuity Payout Initiation Date and before the Contract is Surrendered. If your spouse becomes a successor owner of the Contract, no Death Benefit will be payable on account of your death.
When the Owner is a non-natural person, a Death Benefit is payable under the Contract if the Annuitant dies before the Annuity Payout Initiation Date and before the Contract is Surrendered. For this purpose, a non-natural person is a trust, custodial account, corporation, limited liability company, partnership, or other entity.
Only one Death Benefit will be paid under the Contract. If a Death Benefit becomes payable, it will be in place of all other benefits under the Contract, and all other rights under this Contract will terminate except for rights related to the Death Benefit.
Death Benefit Payout Date
| If the Death Benefit is to be paid as a lump sum, then it will be paid as soon as practicable after receipt of proof of death and a Request in Good Order for a lump sum payment. |
| If the Death Benefit is to be paid under a Payout Option, then we will apply the Death Benefit value to a Payout Option as soon as practicable after receipt of proof of death and a Request in Good Order. That application date will be the first day of the first payment interval for which a payment is to be made. Death Benefit payments under a Payout Option are made at the end of each payment interval. This means that, for annual payments, the first payment will be made one year after that application date. |
Death Benefit Amount
| If the Death Benefit is paid in a lump sum, then it is equal to the Death Benefit value, increased by any additional post-death interest as required by law. |
| If the Death Benefit will be paid as a series of periodic payments under a Payout Option, then the amount of each payment under the Death Benefit is determined on the date that the Death Benefit value is applied to the Payout Option. The amount or each payment will be based on the Death Benefit value (increased by any additional post-death interest as required by law to the date it is applied to the Payout Option), the Payout Option that applies, and the payment interval. |
Death Benefit Value
The Death Benefit value is the greater of:
| the Account Value determined as of the date that the Death Benefit value is determined; or |
| the Return of Premium Guarantee. |
In either case, the Death Benefit value is reduced by premium tax or other taxes not previously deducted.
The Account Value will reflect the applicable Strategy values as calculated on the date the Death Benefit is determined. If the Death Benefit value is determined on a date other than the end of the Term, the Death Benefit value will be based on the Daily Value Percentage , or on the locked Daily Value Percentage if you have made a Performance Lock election. Please see the Indexed Strategy Value Before End of Term section on page [ ] or the Indexed Strategy Value After Performance Lock Election on page [ ] for more information.
Return of Premium Guarantee
The Return of Premium Guarantee is equal to your Purchase Payments (the Purchase Payment base), reduced proportionally for all withdrawals, but not including amounts applied to pay Early Withdrawal Charges. The Return of Premium Guarantee is not reduced by Daily Charges.
The reduction in your Purchase Payment base for withdrawals will be in the same proportion that your Account Value was reduced on the date of the withdrawal. A proportional reduction in your Purchase Payment base could be larger than the dollar amount of your withdrawal.
Example. Here is an example of how we calculate a proportional reduction of your Purchase Payment base. In this example, we assume you take an $8,000 withdrawal and the Purchase Payment base is larger than the Account Value at the time of the withdrawal. To simplify the example, we also assume no Early Withdrawal Charge, no premium tax is deducted, and no additional post-death interest is added.
54
Before Withdrawal | After Withdrawal | Explanation | ||||||||
Account Value |
$ | 100,000 | $ | 92,000 | Your withdrawal reduces your Account Value by $8,000 (which is an 8% reduction in your Account Value). $8,000 / $100,000 = 8% | |||||
Purchase Payment base for Death Benefit |
$ | 120,000 | $ | 110,400 | After the withdrawal, the Purchase Payment base for the Death Benefit is also reduced by 8% or $9,600. $120,000 x 8% = $9,600 |
Determination Date
The date that the Death Benefit value is determined is the earlier of: (1) the first anniversary of the date of death; or (2) the date that we have received both proof of death and Requests in Good Order with instructions as to the form of Death Benefit from all Beneficiaries. Thus, in many cases where there are multiple Beneficiaries, the date that the Death Benefit value is determined will be the date when the last Beneficiary submits the necessary Request in Good Order or the first anniversary of death. Until then, the Contract values remain in the Indexed Strategies will renew into new Terms of the same Strategies if the end of a Term is reached, and the Indexed Strategy values may fluctuate. This risk is borne by the Beneficiaries. If all Beneficiaries have not submitted the necessary Request in Good Order by the first anniversary of death, then the Death Benefit value as determined on that first anniversary will thereafter earn interest at a fixed rate at least equal to the rate required by state law.
Proof of Death. Before making payment of a Death Benefit, or any other payment or transfer of ownership rights that depends on the death of a specified person, we will require proof of death. We may delay making any payment until it is received. For this purpose, proof of death is:
| a certified copy of a death certificate showing the cause and manner of death; |
| a certified copy of a decree that is made by a court of competent jurisdiction as to the finding of death; or |
| other proof that is satisfactory to us. |
Form of Death Benefit
The Death Benefit is paid in the form of annual payments for a fixed period of two years.
In place of that, you may elect to have the Death Benefit paid in one lump sum or in any form of Payout Option that is available under your Contract. The available Payout Options are described in the Payout Options section below. There is no additional charge associated with this election. Any election is subject to the Death Benefit Distribution Rules described below.
You may make an election by a Request in Good Order. We must receive your request on or before the date of death for which a Death Benefit is payable. If you do not make such an election, the Beneficiary may make that election after the date of death. The Beneficiarys election must be made by a Request in Good Order that is received by us no later than the date that the Death Benefit value is applied to a Payout Option and at least 30 days before the date of the first payment to be made.
Additional Rules for Payout Options. A Payout Option that is contingent on life is based on the life of the Beneficiary or, in some cases, the life of a person to whom the Beneficiary is obligated. We will pay the Death Benefit as a lump sum rather than as payments under a Payout Option if: (1) the Death Benefit is less than $2,000; or (2) as of the date that the Death Benefit value is to be applied to a Payout Option, the Death Benefit Distribution Rules do not allow a two-year payout.
Payee of Death Benefit Payments
Death Benefit payments generally are made to the Beneficiary as the payee.
In place of that, the Beneficiary may elect to have payments made:
| as a tax-free exchange, transfer, or rollover to or for an annuity or tax-qualified account as permitted by federal tax law; or |
| in cases where the Beneficiary is an estate, trust, custodial account, corporation, limited liability company, partnership, or other entity, to a person to whom the Beneficiary is obligated to make corresponding payments. |
Payments that become due after the death of the Beneficiary are made to:
| the contingent payee designated as part of a Death Benefit Payout Option elected by you; or if none |
| then to a contingent payee designated by the Beneficiary; or if none |
| the estate of the last payee who received payments. |
Such payments are subject to the Death Benefit Distribution Rules described below.
55
You may designate a contingent payee by a Request in Good Order. A Beneficiary may make or change a payee or contingent payee, except a Beneficiary may not change a designation made as part of a Payout Option election made by you for the Death Benefit. If the Beneficiary designates his or her spouse as a contingent payee and their marriage ends before the Beneficiarys death, then we will treat the former spouse as having predeceased the Beneficiary except to the extent a court order provides that the former spouses rights as a contingent payee are to continue.
Death Benefit Distribution Rules
The Death Benefit Distribution Rules are summarized below.
| For a Tax Qualified Contract. The Death Benefit must be paid in accordance with the tax qualification endorsement. |
| For a Nonqualified Contract. The Death Benefit must be paid either: (1) in full within five years of the date of death; or (2) over the life of the Beneficiary or over a period certain not exceeding the Beneficiarys life expectancy, with payments at least annually, and with the first payment made within one year of the date of death. |
The standard Payout Options are described below. We will make payments in any other form of Payout Option that is acceptable to us at the time of any election. More than one Payout Option may be elected if the requirements for each Payout Option elected are satisfied. All elected Payout Options must comply with pertinent laws and regulations.
Payments under each standard Payout Option are made at the end of a payment interval. For example, if the Annuity Payout Initiation Date is October 31, 2028 and you select annual payments, then the first payment will be paid as of October 31, 2029.
Fixed Period Payout
| For the Annuity Payout Benefit |
We will make periodic payments to you, or to the Annuitant, if you direct, for the fixed period of time that you select. For a nonqualified contract, fixed periods shorter than 10 years are not available. For a tax-qualified contract, the only fixed period available is 10 years.
| If the payee dies before the end of the fixed period, then we will make periodic payments to the surviving owner(s), or if none, then to the surviving contingent payee(s), or if none, then to the estate of the last payee who received payments. |
| In all cases, payments will stop at the end of the fixed period. |
| For the Death Benefit |
We will make periodic payments to the Beneficiary for the fixed period of time that you or the Beneficiary selects. The fixed period cannot exceed the life expectancy of the Beneficiary. For a tax-qualified contract, the fixed period also cannot exceed 10 years.
| If the Beneficiary dies before the end of the fixed period, then we will make periodic payments to the contingent payee designated as part of any Death Benefit Payout Option that you have elected. If no such contingent payee is surviving, then such payments will be made to a contingent payee designated by the Beneficiary. If there is no contingent payee surviving, then such payments will be made to the estate of the last payee who received payments. |
| In all cases, payments will stop at the end of the fixed period. |
Life Payout
| For the Annuity Payout Benefit |
We will make periodic payments to you, or to the Annuitant, if you direct, for as long as the Annuitant lives. Payments will stop on the death of the Annuitant. This means that, even if we have made only one payment when the Annuitant dies, payments will stop.
If the Annuitant dies after the Annuity Payout Initiation Date but before the first payment, a Life Payout will not provide any benefit at all. In that case, we will reverse the Annuity Benefit Payout election and treat the Contract as if the Annuity Payout Initiation Date had not yet been reached.
| If the Owner is living, this treatment will generally allow the Owner to choose between continuing the Contract as a deferred annuity or electing a new Annuity Payout Initiation Date and another Payout Option. |
| If the Annuitants death before the Annuity Payout Initiation Date would give rise to a Death Benefit, then the Death Benefit will be available. |
For a tax-qualified contract, a Life Payout is not available to all Beneficiaries.
| For the Death Benefit |
We will make periodic payments to the Beneficiary for as long as the Beneficiary lives. Payments will stop on the death of the Beneficiary. This means that, even if we have made only one payment when the Beneficiary dies, payments will stop.
56
If the Beneficiary dies after the Death Benefit is applied to the Payout Option but before the first payment, a Life Payout will not provide any benefit at all. In that case, we will reverse the Payout Option election and allow the Beneficiarys estate to choose a new Payout Option or to take the Death Benefit as a lump sum.
Life Payout with Payments for at Least a Fixed Period
| For the Annuity Payout Benefit |
We will make periodic payments to you, or to the Annuitant, if you direct, for as long as the Annuitant lives. For a tax-qualified contract, fixed periods longer than 10 years are not available.
| If the Annuitant dies after the end of the fixed period you selected, then payments will stop on the death of the Annuitant. |
| If the Annuitant dies before the end of the fixed period you selected, then we will make periodic payments to the surviving owner(s), or if none, then to the surviving contingent payee(s), or if none, then to the estate of the last payee who received payments. In this case, payments will stop at the end of the fixed period you selected. |
| For the Death Benefit |
We will make periodic payments to the Beneficiary for as long as the Beneficiary lives. The fixed period cannot exceed the life expectancy of the Beneficiary. For a tax-qualified contract, a Life Payout with Payments for at Least a Fixed Period is not available to all Beneficiaries, and the fixed period also cannot exceed 10 years.
| If the Beneficiary dies after the end of the fixed period selected, then payments will stop on the death of the Beneficiary. |
| If the Beneficiary dies before the end of the fixed period you or the Beneficiary selected, then we will make periodic payments to the contingent payee designated as part of any Death Benefit Payout Option that you have elected. If no such contingent payee is surviving, then such payments will be made to a contingent payee designated by the Beneficiary. If there is no contingent payee surviving, then such payments will be made to the estate of the last payee who received payments. In this case, payments will stop at the end of the fixed period you or the Beneficiary selected. |
Joint and One-Half Survivor Payout
| For the Annuity Payout Benefit |
We will make periodic payments to you, or to the primary Annuitant, if you direct, for as long as the primary Annuitant lives.
| If the primary Annuitant dies and the secondary Annuitant does not survive the primary Annuitant, then payments will stop on the death of the primary Annuitant. This means that, even if we have made only one payment when the primary Annuitant dies, payments will stop unless the secondary Annuitant survives. |
| If the primary Annuitant dies and the secondary Annuitant is surviving, then we will make one-half of the periodic payment to you, or the secondary Annuitant, if you direct, for the rest of the secondary Annuitants life. In this case, payments will stop on the death of the secondary Annuitant. |
If the Annuitant dies after the Annuity Payout Initiation Date but before the first payment, a Joint and One-Half Survivor Payout will never provide the full payment amount. In that case, if the secondary Annuitant agrees, we will reverse the Annuity Benefit Payout election and treat the Contract as if the Annuity Payout Initiation Date had not been reached.
| If the Owner is living, this treatment will generally allow the Owner to choose between continuing the Contract as a deferred annuity or electing a new Annuity Payout Initiation Date and another Payout Option. |
| If the Annuitants death before the Annuity Benefit Payout Initiation Date would give rise to a Death Benefit, then the Death Benefit will be available. |
| For the Death Benefit |
We will make periodic payments to the Beneficiary for as long as the Beneficiary lives.
| If the Beneficiary dies and the contingent payee does not survive the Beneficiary, then payments will stop on the death of the Beneficiary. This means that, even if we have made only one payment when the Beneficiary dies, payments will stop unless the contingent payee survives. |
| If the Beneficiary dies and the contingent payee designated as part of the Death Benefit Payout Option election is surviving, then we will make one-half of the periodic payment to the contingent payee for the rest of the contingent payees life. In this case, payments will stop on the death of the contingent payee. |
If the Beneficiary dies after the Death Benefit is applied to the Payout Option but before the first payment, a Joint and One-Half Survivor Payout will never provide the full payment amount. In that case, if the contingent payee agrees, we will reverse the Payout Option election and allow the Beneficiarys estate to choose a new Payout Option or to take the Death Benefit as a lump sum.
A Joint and One-Half Survivor Payout is only available to a Beneficiary who is the surviving spouse of the owner.
57
Payments under a Payout Option
Payments under a Payout Option are calculated and paid as fixed dollar payments. The stream of payments is an obligation of the general account of MassMutual Ascend Life. Fixed dollar payments will remain level for the duration of the payment period. Once payments begin under a Payout Option, the Payout Option may not be changed. Once the Contract value is applied to a Payout Option, the periodic payments cannot be accelerated or converted into a lump sum payment unless we agree.
We will use the 2012 Individual Annuity Reserving Table with projection scale G2 for blended lives (60% female/40% male) with interest at 1% per year, compounded annually, to compute all guaranteed Payout Option factors, values, and benefits under the Contract. For purposes of calculating payments based on the age of a person, we will use his or her age as of his or her last birthday.
Considerations in Selecting a Payout Option
Payments under a Payout Option are affected by various factors, including the length of the payment period, the life expectancy of the person on whose life payments are based, and the frequency of the payment interval (monthly, quarterly, semi-annually or annually).
| Generally, the longer the period over which payments are made or the more frequently the payments are made, the lower the amount of each payment because more payments will be made. |
| For Life Payout Options, the longer the life expectancy of the Annuitant or Beneficiary, the lower the amount of each payment because more payments are expected to be paid. |
Non-Human Payees under a Payout Option
Except as stated below, the primary payee under a Payout Option must be a human being. All payments during his or her life must be made by check payable to the primary payee or by electronic transfer to a bank account owned by the primary payee.
Exceptions. Below are some exceptions to the general rule that the primary payee must be a human being. We may make other exceptions in our discretion.
| A nonhuman that is the Owner of the Contract may be the primary payee. For example, if the Owner is a trust, that trust may be the primary payee. |
| Payments may be made payable to another insurance company or financial institution as a tax-free exchange, transfer, or rollover to or for another annuity or tax-qualified account as allowed by federal tax law. |
PROCESSING PURCHASE PAYMENTS AND REQUESTS
Processing Purchase Payments
| If we receive a Purchase Payment on a Market Day before the Market Close, we will apply it to your Contract on that Market Day. |
| If we receive a Purchase Payment on a Market Day after the Market Close or on a day that is not a Market Day, then we will apply it to your Contract on the next Market Day. |
An amount applied to a Contract will be held in the Purchase Payment Account until it is applied to an Indexed Strategy or Strategies on a Strategy Application Date pursuant to your instructions. We cannot apply an amount held in the Purchase Payment Account to an Indexed Strategy or Strategies if we do not have complete instructions from you.
If you have any questions, you should contact us or your registered representative before sending a Purchase Payment.
Processing Requests
| Requests may be made by mail at P.O. Box 5423, Cincinnati OH 45201-5423. |
| Requests by fax may be made at 800-807-9777. |
| Requests for reallocations among Indexed Strategies may be made by telephone at 1-800-789-6771 between 8:00 AM and 4:00 PM Eastern Time Monday through Friday. We may also permit reallocation requests to be made at our website (www. massmutualascend.com). Some selling firms may restrict the ability of their registered representatives to convey reallocation requests by telephone or Internet on your behalf. |
To obtain one of our forms (for example, a Strategy Selection form or a Withdrawal Request form) or to obtain more information about how to make a request, call us at 1-800-789-6771 or send us a fax at 800-807-9777. You can also request forms or information by mail at MassMutual Ascend Life Insurance Company, P.O. Box 5423, Cincinnati OH 45201-5423. You may also obtain forms on our website (www. massmutualascend.com).
58
We cannot process a request unless it is a Request in Good Order. A request may be rejected or delayed if it is not a Request in Good Order.
| If we receive a Request in Good Order on a Market Day before the Market Close, we will process it using values determined for the Market Close on that Market Day. |
| If we receive a Request in Good Order after the Market Close or on a day that is not a Market Day, then we will treat that request as received at the start of the next Market Day. |
If you have any questions, you should contact us or your registered representative before submitting the request.
Exception. If a withdrawal under an automatic withdrawal program is scheduled for a date that is not a Market Day, then we will process the withdrawal on the scheduled date using values at the most recent Market Close. For example, if the automatic withdrawal is scheduled for a date that falls on Sunday and there was a Market Close at 4:00 PM on the previous Friday, then we will process the withdrawal on Sunday using values determined at 4:00 PM on that Friday.
Market Days and Market Close
A Market Day is each day that all markets that are used to measure available Indexed Strategies are open for regular trading.
| Saturdays, Sundays, holidays and any other day that the New York Stock Exchange and the NYSE Arca are closed are not Market Days. |
| The NYSE and the NYSE Arca observe the following holidays: New Years Day, Martin Luther King, Jr. Day, Presidents Day, Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving Day, and Christmas Day. |
A Market Close is the close of the regular or core trading session on the market used to measure a given Indexed Strategy.
| Regular trading hours on the NYSE and core trading sessions on the NYSE Arca usually end at 4:00 PM Eastern Time |
| Trading hours on the NYSE and core trading sessions on the NYSE Arca end at 1:00 PM Eastern Time on the day before the Fourth of July and the Friday after Thanksgiving and Christmas Eve. |
Regular trading or a core trading session may end at a different time on a Market Day under certain circumstances when and as permitted under applicable rules. Such circumstances generally cannot be predicted in advance.
Specific information about NYSE and NYSE Arca holidays and trading hours in any given calendar year is available at https://www.nyse.com/markets/hours-calendars.
Receipt of Purchase Payments, Applications and Requests
For purposes of processing, we deem Purchase Payments and applications, Requests in Good Order and other instructions (paperwork) mailed to our post office box as received by us at our administrative office when the Purchase Payment or the paperwork reaches the applicable processing department located at 191 Rosa Parks Street, Cincinnati OH 45202.
Risks and Limitations Related to Requests by Telephone or Internet
We will use reasonable procedures such as requiring certain identifying information, tape recording the telephone instructions, and providing written confirmation of the transaction, in order to confirm that instructions communicated by telephone, fax, Internet or other means are genuine. Any telephone, fax or Internet instructions reasonably believed by us to be genuine will be your responsibility, including losses arising from any errors in the communication of instructions. As a result of this policy, you will bear the risk of loss. We are not responsible for the validity of any request or action.
Telephone and computer systems may not always be available. Any telephone or computer system, whether it is yours, your service providers, your agents, or ours, can experience outages or slowdowns for a variety of reasons. These outages or slowdowns may delay or prevent our processing of your request. Although we have taken precautions to help our systems handle heavy use, we cannot promise complete reliability under all circumstances. If you experience technical difficulties or problems, you should consider making your request by mail.
Suspension of Payments or Transfers
We may be required to suspend or delay payments, withdrawals and reallocations when we cannot obtain an Index value because:
| the New York Stock Exchange or NYSE Arca is closed (other than customary weekend and holiday closings); |
| trading on the New York Stock Exchange or NYSE Arca is restricted; or |
| an emergency exists such that it is not reasonably practicable to determine fairly the value of the Index. |
59
In this case, we will make payments and process withdrawals and reallocations as soon as practicable after we are able to obtain the Index value.
We may suspend or delay payments, withdrawals and reallocations when we are permitted to do so under a regulatory order. In this case, we will make payments and process withdrawals and reallocations when the order is no longer in effect.
Restrictions on Financial Transactions
Federal laws designed to counter terrorism and prevent money laundering might, in certain circumstances, require us to block an Owners ability to make certain transactions. This means that we may be required to refuse to accept any request for withdrawals, Surrenders, Annuity Payout Benefit payments or Death Benefit payments, until instructions are received from the appropriate regulator. We may also be required to provide additional information about you and your Contract to government regulators.
If you change your mind about owning the Contract, you may cancel it within 20 days after you receive it. If you purchase this Contract to replace an existing annuity contract or life insurance policy, you have 30 days after you receive it. This is known as a free look. The right to cancel period may be longer in some states.
To cancel your Contract, you must submit your request to cancel to the producer who sold it or send it to us at P.O. Box 5423, Cincinnati, OH 45201-5423. If sent to us by mail, it is effective on the date postmarked with proper address and postage paid. Your request to cancel must be in writing and signed by you.
If you cancel your Contract, you will receive a refund. The amount of the refund will depend on where you live. When you cancel the Contract within this free look period, we will not assess an Early Withdrawal Charge.
| If you live in a state where we are required to refund your Purchase Payment(s), we reserve the right to hold your Purchase Payment(s) in the Purchase Payment Account until the first Strategy Application Date on or after the end of the free look period. |
| If you live in a state where we are required to refund the Account Value of your Contract, you will receive the Account Value on the day that we receive your cancellation Request in Good Order. If the Account Value includes the value of an Indexed Strategy, that Strategy value will reflect the applicable Daily Value Percentage. The amount you receive may be more or less than your Purchase Payment(s) depending upon any interest earned by your Contract and the value of your Indexed Strategies. This means that you bear the risk of any decline in the Account Value of your Contract before we receive your cancellation request. |
No Early Withdrawal Charges will apply to the amount refunded. Unless required by state law, we do not refund any Daily Charge assessed during the free look period or any Early Withdrawal Charges assessed during the free look period that relate to a withdrawal taken before you cancel the Contract.
The State Variations section of this prospectus contains a summary of the state law provisions related to the free look period and the required refund amount.
There may be tax consequences if you cancel the Contract. You should seek advice on tax questions based on your particular circumstances from a tax advisor.
ANNUAL STATEMENT AND CONFIRMATIONS
At least once each calendar year, we will send you a statement that will show: (1) your Account Value; (2) all transactions regarding your Contract during the year; and (3) any interest credited to your Contract and/or any other changes in Strategy value credited to your Contract.
We will also send you written confirmations of Purchase Payments, Indexed Strategy allocations and renewals, withdrawals, and other financial transactions under your Contract. Statements and confirmations will be sent to your last known address on our records.
You should promptly report any inaccuracy or discrepancy in a statement or confirmation. To report an inaccuracy or discrepancy, contact us at P.O. Box 5423, Cincinnati, OH 45201-5423, or call us at 1-800-789-6771. To protect your rights, you should consider reconfirming any oral communications by sending a written statement to P.O. Box 5423, Cincinnati, OH 45201-5423.
You may elect to receive electronic delivery of the Contract prospectus and other Contract related documents. Contact us at our website at www. massmutualascend.com for more information and to enroll.
60
ABANDONED PROPERTY REQUIREMENTS
Every state has unclaimed property laws. These laws generally declare annuity contracts to be abandoned after a period of inactivity of three to five years from: (1) the latest permitted Annuity Payout Initiation Date; or (2) the date of death for which a Death Benefit is due and payable. For example, if the payment of a death benefit has been triggered, but the beneficiary does not come forward to claim the death benefit in a timely manner, the unclaimed property laws will apply.
If a Death Benefit, Annuity Payout Benefit payments or other contract proceeds are unclaimed, we will pay them to the abandoned property division or unclaimed property office of the applicable state. (Escheatment is the formal, legal name for this process.) For example, on an unclaimed Death Benefit, depending on the circumstances, the proceeds are paid: (1) to the state where the beneficiary last resided, as shown on our books and records; (2) to the state where the contract owner last resided, as shown on our books and records; or (3) to Ohio, which is our state of domicile. The state will hold the proceeds without interest until a valid claim is made by the person entitled to the proceeds.
To prevent escheatment of the Death Benefit, Annuity Payout Benefit payments, or other proceeds from your Contract, it is important:
| to update your contact information, such as your address, phone number, and email address, if and as it changes; and |
| to update your Beneficiary and other designations, including complete names, complete addresses, phone numbers, and social security numbers, if and as they change. |
Please contact us at P.O. Box 5423, Cincinnati, OH 45201-5423, or call us at 1-800-789-6771, to make such updates.
State unclaimed property laws do not apply to annuity contracts that are held under an employer retirement plan that is subject to the Employee Retirement Income Security Act of 1974 (ERISA).
The Owner on the Contract Effective Date is set out on your Contract Specifications Page. The Owner possesses all of the ownership rights under a Contract, such as making allocations among the Indexed Strategies, electing a Payout Option, and designating a Beneficiary.
If an Owner is a trust, custodial account, corporation, limited liability company, partnership, or other entity, then the age of the eldest Annuitant is treated as the age of the Owner for all purposes of this Contract.
Joint Owners
| For a Nonqualified Contract. Two persons may jointly own the Contract. In this case, the term Owner includes the joint Owner and you must exercise all rights of ownership by joint action. |
| For a Tax Qualified Contract. No joint owner is permitted. |
Change of Owner
| For a Nonqualified Contract. You may change the Owner only with our written consent. A change of Owner cancels all prior Beneficiary designations. It does not cancel a designation of an Annuitant or a Payout Option election. |
| For a Tax Qualified Contract. You cannot change the Owner except to the limited extent permitted by the tax qualification endorsement. |
A change of Owner must be made by a Request in Good Order. A change of Owner may have adverse tax consequences.
Assignment
| For a Nonqualified Contract. You may pledge, charge, encumber or assign you interest in this Contract only with our written consent. If we grant our consent, you may assign all or any part of your rights under this Contract except your rights to designate or change a Beneficiary or an Annuitant, to change Owners, or to elect a Payout Option. |
| For a Tax Qualified Contract. You cannot pledge, charge, encumber or in any way assign your interest in this Contract except to the limited extent permitted by the tax qualification endorsement. |
An assignment must be requested by a Request in Good Order. We are not responsible for the validity of any assignment. An assignment may have adverse tax consequences.
If we have consented to an assignment, the rights of a person holding the assignment, including the right to any payment under this Contract, come before the rights of an Owner, Annuitant, Beneficiary, or other payee. An assignment may be ended only the person holding it or as provided by law.
61
Successor Owner
Your spouse becomes the successor owner of the Contract and succeeds to all rights of ownership if all of the following requirements are met:
| a Death Benefit is payable on account of your death; |
| the sole Beneficiary under the Contract is your spouse or a revocable trust or custodial account created by your spouse; |
| either you make that election by a Request in Good Order before your death or your spouse makes that election by a Request in Good Order before the Death Benefit Payment Date; and |
| you were not a successor owner of the Contract. |
A successor owner election cancels all prior Beneficiary designations. It does not cancel a designation of an Annuitant or a Payout Option election.
In some states, state law extends this successor owner right to a civil union partner or other person who is not your spouse as defined by federal tax law. In that case, distributions after your death must be made as required by the Death Benefit Distributions Rules described in the Death Benefit section on page [ ].
Community Property
If you live in a community property state and have a spouse at any time while you own this Contract, the laws of that state may vary your ownership rights.
The Annuitant is the natural person on whose life Annuity Payout Benefit payments are based. The Annuitant on the Contract Effective Date is set out on your Contract Specifications Page.
| For a Nonqualified Contract. The Annuitant cannot be changed at any time that the Contract is owned by a trust, custodial account, corporation, limited liability company, partnership, or other entity. Otherwise, you may change a designation of Annuitant at any time before the Annuity Payout Initiation Date. |
| For a Tax Qualified Contract. The Annuitant must be the natural person covered under the retirement arrangement for whose benefit the Contract is held. |
A change of Annuitant must be made by a Request in Good Order. A change of Annuitant does not cancel a designation of a Beneficiary or a Payout Option election.
If an Annuitant dies before the Annuity Payout Initiation Date and no Death Benefit is payable, then in the absence of a new designation, the Annuitant will be:
| the surviving joint Annuitant(s); or if none |
| the Owner(s). |
A Beneficiary is a person entitled to receive all or part of a Death Benefit that is to be paid under this Contract on account of a death before the Annuity Payout Initiation Date.
| If a Death Benefit becomes payable on account of your death or the death of a joint Owner, then the surviving Owner is the Beneficiary no matter what other designation you may have made. |
| In all other cases, you may designate a person or person who will be the Beneficiaries as provided in the Designation of Beneficiary provision of the Contract. |
| If no designated Beneficiary is surviving, then the Beneficiary is your estate. |
| If the sole Beneficiary under the Contract is your spouse or a revocable trust or custodial account created by your spouse and all other requirements for successor ownership are met, then your spouse may become the successor owner of the Contract in lieu of receiving the Death Benefit. |
A designation of Beneficiary must be made by a Request in Good Order. We must receive the request on or before the date of death for which a Death Benefit is payable.
| You may designate two or more persons jointly as the Beneficiaries. Unless you state otherwise, joint Beneficiaries that are surviving are entitled to equal shares. |
| You may designate one or more persons as contingent Beneficiary. Unless you state otherwise, a contingent Beneficiary is entitled to a benefit only if there is no primary Beneficiary who that is surviving. |
62
Survivorship Required
In order to be entitled to receive a Death Benefit, a Beneficiary must survive for at least 30 days after the death for which the Death Benefit is payable.
If you designate your spouse as a Beneficiary and your marriage ends before your death, we will treat your former spouse as having predeceased you unless:
| a court order provides that the former spouses rights as a beneficiary are to continue; or |
| the former spouse remains or becomes an Owner. |
Amendment of the Contract
We reserve the right to amend the Contract to comply with applicable Federal or state laws or regulations. We will notify you in writing of any such amendments.
Misstatement
We may require proof of the age of the Annuitant, Owner and/or the Beneficiary before making any payments under the Contract that are measured by such persons life. If the age of the measuring life has been misstated, the amount payable will be the amount that would have been provided at the correct age. If payments based on the correct age would have been higher, we will pay the underpaid amount with interest. If payments would be lower, we may deduct the overpaid amount, with interest, from succeeding payments.
Involuntary Termination
If the Account Value on any anniversary of the initial Strategy Application Date is less than the minimum required value of $5,000 due to poor market performance or withdrawals from the Contract, we may terminate your Contract on that anniversary.
| If you make only one Purchase Payment, each Term will end on an anniversary of the initial Strategy Application Date. In this case, any involuntary termination will occur on a date that is the end of a Term. |
| If you make multiple Purchase Payments, Terms may end on different dates. In this case, any involuntary termination will occur on a date that is the end of a Term, but it will occur before the end of other Terms. In this case, the Surrender Value payable upon termination of your Contract will reflect the Daily Value Percentages used to calculate the value of Indexed Strategies with Terms that are not ending on the termination date. |
The examples below show the relationship between the date of an involuntary termination and the end of a Term.
Example A. You make one Purchase Payment that is applied to the Indexed Strategies on June 20, 2023. Terms will start and end on June 20 and the anniversary of the initial Strategy Application Date will be June 20. If your Account Value is less than $5,000 on June 20, 2025, we may terminate your Contract on that anniversary date.
Example B. You make two Purchase Payments. One Purchase Payment is applied to the Indexed Strategies on May 6, 2023 and the other Purchase Payment is applied to the Indexed Strategies on June 20, 2023. Terms will start and end on May 6 and on June 20. The anniversary of the initial Strategy Application Date will be May 6.
| If your Account Value is less than $5,000 on June 20, 2025, we may not terminate your Contract because June 20 is not an anniversary of the initial Strategy Application Date. |
| If your Account Value is less than $5,000 on May 6, 2027, we may terminate your Contract on that anniversary date even though the other Term will not end until June 20, 2027. |
If we terminate your Contract, we will pay you the Surrender Value determined as of the date that we terminate your Contract. The Surrender Value will reflect the applicable Indexed Strategy Values as calculated on the day that we terminate your Contract.
Loans
Loans are not available under the Contract.
63
This section provides a general description of federal income tax considerations relating to the Contracts. The purchase, holding and transfer of a Contract may have federal estate and gift tax consequences in addition to income tax consequences. Estate and gift taxation is not discussed in this prospectus. State taxation will vary, depending on the state in which you reside, and is not discussed in this prospectus.
The tax information provided in this prospectus is not intended or written to be used as legal or tax advice. It is written solely to provide general information related to the sale and holding of the Contracts. You should seek advice on legal or tax questions based on your particular circumstances from an attorney or tax advisor.
Tax Deferral on Annuities
Internal Revenue Code (IRC) Section 72 governs taxation of annuities in general. The income earned on a Contract is generally not included in income until it is withdrawn from the Contract. In other words, a Contract is a tax-deferred investment. Tax deferral is not available for a Contract when an Owner is not a natural person unless the Contract is part of a tax-qualified retirement plan or the Owner is a mere agent for a natural person. For a nonqualified deferred compensation plan, this rule means that the employer as Owner of the Contract will generally be taxed currently on any increase in the Surrender Value, although the plan itself may provide a tax deferral to the participating employee.
Under certain circumstances, based on a rule known as the Investor Control Doctrine, the IRS has stated that the holder of an annuity contract could be treated as the owner (for tax purposes) of the assets of a separate account that supports the annuity contract. If you were treated as the owner of an interest in the separate account, then you would be taxed on the income, gain, and loss arising out of your interest in the separate account. Although the IRS has not provided definitive guidance on the application of this rule to indexed annuity contracts, we do not believe that this rule applies to the Contract because you have no specific, fractional, or unitized interest in the separate account assets, we are not obligated to invest the separate account in any particular assets, the investment return and market value of the separate account assets is not allocated in an identical manner to any Contract, the Contract values are determined based on gains and losses regardless of the performance of the separate account assets, and the derivatives that we may hold in the separate account are not publicly traded.
Tax-Qualified Retirement Plans
Annuities may also qualify for tax-deferred treatment, or serve as a funding vehicle, under tax-qualified retirement plans that are governed by other IRC provisions. These provisions include IRC Section 401 (pension, profit sharing, and 401(k) plans), IRC Section 403(b) (tax-sheltered annuities), IRC Sections 408 and 408A (individual retirement annuities), and IRC Section 457(b) (governmental deferred compensation plans). Tax-deferral is generally also available under these tax-qualified retirement plans through the use of a trust or custodial account without the use of an annuity.
The tax law rules governing tax-qualified retirement plans and the treatment of amounts held and distributed under such plans are complex. If the Contract is to be used in connection with a tax-qualified retirement plan, including an individual retirement annuity (IRA) under a Simplified Employee Pension (SEP) Plan, you should seek competent legal and tax advice regarding the suitability of the Contract for your particular situation.
Contributions to a tax-qualified Contract are typically made with pre-tax dollars, while contributions to other Contracts are typically made from after-tax dollars, though there are exceptions in either case. Tax-qualified Contracts may also be subject to restrictions on withdrawals that do not apply to other Contracts. These restrictions may be imposed to meet the requirements of the IRC or of an employer plan.
Following is a brief description of the types of tax-qualified retirement plans for which the Contracts are available.
Individual Retirement Annuities. IRC Sections 219 and 408 permit certain individuals or their employers to contribute to an individual retirement arrangement known as an Individual Retirement Annuity or IRA. Under applicable limitations, an individual may claim a tax deduction for certain contributions to an IRA. Contributions made to an IRA for an employee under a Simplified Employee Pension (SEP) Plan or Savings Incentive Match Plan for Employees (SIMPLE) established by an employer are not includable in the gross income of the employee until distributed from the IRA. Distributions from an IRA are taxable to the extent that they represent contributions for which a tax deduction was claimed, contributions made under a SEP plan or SIMPLE, or income earned within the IRA.
Roth IRAs. IRC Section 408A permits certain individuals to contribute to a Roth IRA. Contributions to a Roth IRA are not tax deductible. Tax-free distributions of contributions may be made at any time. Distributions of earnings are tax-free following the five-year period beginning with the first year for which a Roth IRA contribution was made if the Owner has attained age 59 1/2, become disabled, or died, or for qualified first-time homebuyer expenses.
64
Tax-Sheltered Annuities. IRC Section 403(b) of permits public schools and charitable, religious, educational, and scientific organizations described in IRC Section 501(c)(3) to establish tax-sheltered annuity or TSA plans for their employees. TSA contributions and Contract earnings are generally not included in the gross income of the employee until distributed from the TSA. Amounts attributable to contributions made under a salary reduction agreement cannot be distributed until the employee attains age 59 1/2, severs employment, becomes disabled, incurs a hardship, is eligible for a qualified reservist distribution, or dies. The IRC and the plan may impose additional restrictions on distributions.
Pension, Profit-Sharing, and 401(k) Plans. IRC Section 401 permits employers to establish various types of retirement plans for employees, and permits self-employed individuals to establish such plans for themselves and their employees. These plans may use annuity contracts to fund plan benefits. Generally, contributions are deductible to the employer in the year made, and contributions and earnings are generally not included in the gross income of the employee until distributed from the plan. The IRC and the plan may impose restrictions on distributions. Purchasers of a Contract for use with such plans should seek competent advice regarding the suitability of the Contract under the particular plan.
Governmental Eligible Deferred Compensation Plans. State and local government employers may purchase annuity contracts to fund eligible deferred compensation plans for their employees, as described in IRC Section 457(b). Contributions and earnings are generally not included in the gross income of the employee until the employee receives distributions from the plan. Amounts cannot be distributed until the employee attains age 70 1/2, severs employment, becomes disabled, incurs an unforeseeable emergency, or dies. The plan may impose additional restrictions on distributions.
Roth TSAs, Roth 401(k)s, and Roth 457(b)s. IRC Section 402A permits TSA plans, 401(k) plans, and governmental 457(b) plans to allow participating employees to designate some part or all of their future elective contributions as Roth contributions. Roth contributions to a TSA plan, 401(k) plan, or governmental 457(b) plan are included in the employees taxable income as earned. Amounts attributable to Roth TSA, Roth 401(k), or Roth 457(b) contributions must be held in a separate account from amounts attributable to traditional pre-tax TSA, 401(k), or 457(b) contributions. Distributions from a Roth TSA, Roth 401(k), or Roth 457(b) account are considered to come proportionally from contributions and earnings. Distributions attributable to Roth account contributions are tax-free. Distributions attributable to Roth account earnings are tax-free following the five-year period beginning with the first year for which Roth contributions are made to the plan if the employee has attained age 59 1/2, become disabled, or died. A Roth TSA, Roth 401(k), or Roth 457(b) account is subject to the same distribution restrictions that apply to amounts attributable to traditional pre-tax TSA, 401(k), or 457(b) contributions made under a salary reduction agreement. The plan may impose additional restrictions on distributions.
Nonqualified Deferred Compensation Plans
Employers may invest in annuity contracts in connection with unfunded deferred compensation plans for their employees. Such plans may include eligible deferred compensation plans of non-governmental tax-exempt employers, as described in IRC Section 457(b); deferred compensation plans of both governmental and nongovernmental tax-exempt employers that are taxed under IRC Section 457(f) and subject to Section 409A; and nonqualified deferred compensation plans of for-profit employers subject to Section 409A. In most cases, these plans are designed so that amounts credited under the plan will not be includable in the employees gross income until paid under the plan. In these situations, the annuity contracts are not plan assets and are subject to the claims of the employers general creditors. Whether or not made from the Contract, plan benefit payments are subject to restrictions imposed by the IRC and the plan.
Summary of Income Tax Rules
The following chart summarizes the basic income tax rules governing tax-qualified retirement plans, nonqualified deferred compensation plans, and other non-tax-qualified Contracts.
Tax-Qualified Contracts and Plans |
Nonqualified Deferred |
Other Non-Tax-Qualified Contracts | ||||
Plan Types | IRC §408 (IRA, SEP, SIMPLE IRA)
IRC §408A (Roth IRA)
IRC §403(b) (Tax-Sheltered Annuity)
IRC §401 (Pension, ProfitSharing, 401(k))
Governmental IRC §457(b)
IRC §402A (Roth TSA, Roth 401(k), or Roth 457(b)) |
IRC §409A
Nongovernmental IRC §457(b)
IRC §457(f) |
IRC §72 only | |||
Who May Purchase a Contract | Eligible employee, employer, or employer plan. | Employer on behalf of eligible employee. Employer generally loses tax-deferred status of Contract itself. | Anyone. Non-natural person will generally lose tax-deferred status. | |||
Contribution Limits | Contributions are limited by IRC and/or plan requirements. | None. | ||||
Distribution Restrictions | Distributions from Contract and/or plan may be restricted to meet IRC and/or plan requirements. | None. |
65
Tax-Qualified Contracts and Plans |
Nonqualified Deferred |
Other Non-Tax-Qualified Contracts | ||||
Taxation of Withdrawals, Surrenders, and Lump Sum Death Benefit | Generally, 100% of distributions must be included in taxable income. However, the portion that represents an after-tax investment is not taxable. Distributions from Roth IRA are deemed to come first from after- tax contributions. Distributions from other plans are generally deemed to come from income and after-tax investment (if any) on a pro-rata basis. Distributions from §408A Roth IRA or §402A Roth TSA, Roth 401(k), or Roth 457(b) are completely tax free if certain requirements are met.
For tax purposes, all IRAs and SEP IRAs of an owner are treated as a single IRA, and all Roth IRAs of an owner are treated as a single Roth IRA. |
Generally, distributions must be included in taxable income until all accumulated earnings are paid out. Thereafter, distributions are tax-free return of the original investment. However, distributions are tax-free until any investment made before August 14, 1982 is returned.
For tax purposes, all non-tax-qualified annuity contracts issued to the same owner by the same insurer in the same calendar year are treated as one contract. | ||||
Taxation of Payout Option Payments (Annuity Benefit or Death Benefit) | A percentage of each payment is tax free equal to the ratio of after-tax investment (if any) to the total expected payments, and the balance is included in taxable income. Once the after-tax investment has been recovered, the full amount of each benefit payment is included in taxable income. Distributions from a Roth IRA, Roth TSA, Roth 401(k), or Roth 457(b) are completely tax free if certain requirements are met. | |||||
Possible Penalty Taxes for Distributions Before Age 59 1/2 | Taxable portion of payments made before age 59 1/2 may be subject to 10% penalty tax (or 25% for a SIMPLE IRA during the first two years of participation). Penalty taxes do not apply to payments after the participants death, or to §457 plans. Other exceptions may apply. | None. | Taxable portion of payments made before age 59 1/2 may be subject to a 10% penalty tax. Penalty taxes do not apply to payments after the Owners death. Other exceptions may apply. | |||
Assignment/ Transfer of Contract | Assignment and transfer of Ownership generally not permitted. | Generally, deferred earnings taxable to transferor upon transfer or assignment. Gift tax consequences are not discussed herein. | ||||
Federal Income Tax Withholding | Eligible rollover distributions from §401, §403(b), and governmental §457(b) plans are subject to 20% mandatory withholding on taxable portion unless direct rollover. For other payments, Payee may generally elect to have taxes withheld or not. | Generally subject to wage withholding. | Generally, Payee may elect to have taxes withheld or not. |
Rollovers, Transfers, and Exchanges
Amounts from a tax-qualified Contract may be rolled over, transferred, or exchanged into another tax-qualified account or retirement plan as permitted by the IRC and plan(s). Amounts may be rolled over, transferred, or exchanged into a tax-qualified Contract from another tax-qualified account or retirement plan as permitted by the IRC and plan(s). In most cases, such a rollover, transfer, or exchange is not taxable, unless the rollover of pre-tax amounts is made into a Roth IRA, a Roth TSA, Roth 401(k), or Roth 457(b). Rollovers, transfers, and exchanges are not subject to normal contribution limits. The IRC or plan may require that rollovers be held in a separate Contract from other plan funds.
Amounts from a non-tax-qualified Contract may be transferred to another non-tax-qualified annuity or to a qualified long-term care policy as a tax-free exchange as permitted by the IRC Section 1035. Amounts from another non-tax-qualified annuity or from a life insurance or endowment policy may be transferred to a Contract as a tax-free exchange under IRC Section 1035.
Required Distributions
The Contracts are subject to the required distribution rules of federal tax law. These rules vary based on the tax qualification of the Contract or the plan under which it is issued.
66
For a tax-qualified Contract other than a Roth IRA, required minimum distributions must generally begin by April 1 following the year the participant attains age 73 (age 72 if born after June 30, 1949, but before January 1, 1951 or age 70 1/2 if born before July 1, 1949). However, for a 403(b) Tax-Sheltered Annuity Plan, a 401 Pension, Profit-Sharing, or 401(k) Plan, or a 457(b) Governmental Deferred Compensation Plan, a participant who is not a 5% owner of the employer may delay required minimum distributions until April 1 following the year in which the participant retires from that employer. The required minimum distributions during life are calculated based on standard life expectancy tables adopted under federal tax law.
For a Roth IRA or for a Contract that is not tax-qualified, there are no required distributions during life.
A tax-qualified Contract must make required distributions after death. The required distributions vary depending on the type of beneficiary. Some beneficiaries may take payments over life or life expectancy, and others must receive all benefits within five or ten years after death. A non-tax-qualified Contract that has begun making payments under a payout option during the Owners life must make any remaining payments at least as rapidly after death. If payments from a non-tax-qualified Contract have not begun, then the death benefit must be paid out in full within five years after death, or must be paid out in substantially equal payments beginning within one year of death over a period not exceeding the life expectancy of the designated beneficiary.
For a traditional IRA, a Roth IRA, or a Contract that is not tax-qualified, a beneficiary who is a surviving spouse may elect out of these requirements, and apply the required distribution rules as if the Contract were his or her own. For this purpose, federal tax law recognizes as married any two people whose marriage is valid in the state in which it was celebrated. A civil union or domestic partnership is not considered a marriage.
We reserve the right to deduct from the Purchase Payment or Account Value any taxes relating to the Contract paid by us to any government entity (including, but not limited to, premium taxes, additional taxes, and maintenance taxes on insurers, Federal, state and local withholding of income, estate, inheritance, or other taxes required by law from annuity purchase payments, and any new or increased taxes on insurers or annuity purchase payments that may be enacted into law).
Currently some state governments impose premium taxes, additional taxes, and maintenance taxes on insurers based on annuity purchase payments received or applied to an annuity payout benefit. These taxes currently range from zero to 3.5% depending upon the jurisdiction and the tax qualification of the Contract. A federal premium tax has been proposed but not enacted. We may deduct any such premium or other taxes from the Purchase Payments or the Account Value at the time that the tax is imposed. We may also deduct any such tax not previously deducted from the Annuity Payout value or Death Benefit value.
We reserve the right to deduct from the Contract for any income taxes that we incur because of the Contract. At the present time, however, we are not incurring any such income tax or making any such deductions.
MM Ascend Investor Services, LLC (MMALIS) is the principal underwriter and distributor of the securities offered through this prospectus. MMALIC and MMALIS are affiliated because MMALIS is a subsidiary of MMALIC. MMALIS also acts as the principal underwriter and distributor of the variable annuity contracts that are issued by one of our subsidiaries.
MMALISs principal executive offices are located at 191 Rosa Parks Street, Cincinnati, Ohio 45202. MMALIS is registered as a broker- dealer with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as well as the securities regulators in the states in which it operates and registration is required. MMALIS is a member of the Financial Industry Regulatory Authority (FINRA).
Contracts are sold by licensed insurance agents (the Selling Agents) in those states where the Contract may be lawfully sold. Such Selling Agents will be appointed agents of MMALIC and will be registered representatives of broker-dealer firms (the Selling Broker-Dealers) that have entered into selling agreements with us and MMALIS. Selling Broker-Dealers will be registered under the Securities Exchange Act of 1934 and will be members of FINRA.
FINRA provides background information about broker-dealers and their registered representatives through FINRA BrokerCheck. You may contact the FINRA BrokerCheck Hotline at 1-800-289-9999, or log on to www.finra.org to learn more about MMALIS, your Selling Agent, and his or her Selling Broker Dealer.
MMALIS receives no compensation for acting as underwriter of the Contracts; however, MMALIC pays for some of MMALISs operating and other expenses, including overhead and legal and accounting fees. MMALIC may reimburse MMALIS for certain sales expenses, such as marketing materials and advertising expenses, and other expenses of distributing the Contracts.
67
MMALIC or MMALIS pay the Selling Broker-Dealers compensation for the promotion and sale of the Contract. The Selling Agents who solicit sales of the Contract typically receive a portion of the compensation paid to the Selling Broker-Dealers in the form of commissions or other compensation, depending on the agreement between the Selling Broker-Dealer and the Selling Agent.
The amount and timing of commissions paid to Selling Broker-Dealers may vary depending on the selling agreement but it will not be more than 9.2% of each Purchase Payment. In most cases, such amounts paid to a Selling Broker-Dealer will be divided between the Selling Agent and the Selling Broker-Dealer. Some Selling Broker-Dealers may elect to receive a lower commission when a Purchase Payment is made, along with annual trail commissions up to 1.5% of Account Value for so long as a contract remains in effect or as agreed in the selling agreement. MMALIC may pay or allow other promotional incentives or payments in the form of cash or other compensation to the extent permitted by FINRA rules and other applicable laws and regulations.
MMALIC also may pay compensation to wholesaling broker-dealers or other firms or intermediaries in return for wholesaling services such as providing marketing and sales support, product training, and administrative services to the Selling Agents of the Selling Broker-Dealers. These allowances may be based on a percentage of a Purchase Payment.
In addition to the compensation described above, MMALIC may make additional cash payments, in certain circumstances referred to as override compensations, or reimbursements to Selling Broker-Dealers in recognition of their marketing and distribution, transaction processing and/or administrative services support. These payments are not offered to all Selling Broker-Dealers, and the terms of any particular agreement governing the payments may vary among Selling Broker-Dealers depending on, among other things, the level and type of marketing and distribution support provided. Marketing and distribution support services may include, among other services, placement of MMALICs products on the Selling Broker-Dealers preferred or recommended list, increased access to the Selling Broker-Dealers registered representatives for purposes of promoting sales of MMALIC products, assistance in training and education of the Selling Agents, and opportunities for MMALIC and MMALIS to participate in sales conferences and educational seminars. The payments or reimbursements may be calculated as a percentage of the particular Selling Broker-Dealers actual or expected aggregate sales of our indexed annuity contracts (including the Contract) and/or may be a fixed dollar amount. Broker-dealers receiving these additional payments may pass on some or all of the payments to the Selling Agents.
You should ask your Selling Agent for further information about the commissions or other compensation that he or she, or the Selling Broker-Dealer for which he or she works, may receive in connection with your purchase of a Contract.
There is no front-end sales load deducted from the Purchase Payment(s) to pay sales commissions. Commissions and other incentives or payments described above are not charged directly to you. We intend to recoup at least a portion of the sales commissions and other sales expenses through fees and charges deducted under the Contract.
MASSMUTUAL ASCEND LIFES GENERAL ACCOUNT
Our general account (the General Account) holds all our assets other than assets in our insulated separate accounts. We own our General Account assets, and, subject to applicable law, have sole investment discretion over them. The assets are subject to our general business operation liabilities and claims of our creditors and may lose value. Our General Account assets fund the guarantees provided in the Contracts.
We must invest our assets according to applicable state laws regarding the nature, quality and diversification of investments that may be made by life insurance companies. In general, these laws permit investments, within specified limits and subject to certain qualifications, in Federal, state and municipal obligations, corporate bonds, preferred and common stocks, real estate mortgages, real estate and certain other investments.
We place a majority of the Purchase Payments made under the Contract in our General Account where we primarily invest the assets in a variety of fixed income securities.
We place a portion of the Purchase Payments made under the Contract in a non-unitized separate account (the Separate Account) that is not registered with the Securities and Exchange Commission. We established and maintain the Separate Account pursuant to the laws of our domiciliary state for the purpose of supporting our obligation to adjust the Indexed Strategy values based on the Daily Value Percentage or rise or fall of the Index. The assets of the Separate Account are held in our name on behalf of the Separate Account and legally belong to us. The assets in the Separate Account are not chargeable with liabilities arising out of any other business that we conduct. We may invest these assets in hedging instruments, including derivative contracts as well as other assets permitted under state law. To support our obligations to adjust the Indexed Strategy values, we may move money between the Separate Account and our General Account. We are not obligated to invest the assets of the Separate Account according to any particular plan except as we may be required to by state insurance laws. Regardless of your Strategy allocations, we do not intend to invest the assets of the Separate Account in the iShares MSCI EAFE exchange traded fund the iShares U.S. Real Estate exchange traded fund, or the SPDR Gold Shares exchange traded fund. We may or may not hold the hypothetical options described in this prospectus in the Separate Account.
Contract owners do not have any interest in or claim on the assets in the Separate Account nor do Contract owners participate in any way in the performance of assets held in the Separate Account.
68
Reliance on Rule 12h-7
MassMutual Ascend Life relies on the exemption provided by Rule 12h-7 under the Securities Exchange Act of the 1934 Act from the requirement to file reports pursuant to Section 15(d) of that Act.
Legal Proceedings
MassMutual Ascend Life and its subsidiaries are involved in litigation from time to time, generally arising in the ordinary course of business. This litigation may include, but is not limited to, general commercial disputes, lawsuits brought by contract owners and policyholders, employment matters, reinsurance collection matters and actions challenging certain business practices of insurance subsidiaries. Also, from time to time, state and federal regulators or other officials conduct formal and informal examinations or undertake other actions dealing with various aspects of the financial services and insurance industries. It is not possible to predict with certainty the ultimate outcome of any pending legal proceeding or regulatory action. However, MassMutual Ascend Life does not believe any such action or proceeding will have a material adverse effect upon its ability to meet its obligations under the Contracts.
Legal Opinion on Contracts
Legal matters in connection with federal laws and regulations affecting the issue and sale of the Contracts described in this prospectus and the organization of MassMutual Ascend Life, its authority to issue such Contracts under Ohio law, and the validity of the forms of the Contracts under Ohio law have been passed on by John P. Gruber, General Counsel of MassMutual Ascend Life.
Securities and Exchange Commission Position on Indemnification
Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers or persons controlling MassMutual Ascend Life pursuant to its articles of incorporation or its code of regulations or pursuant to any insurance coverage or otherwise, MassMutual Ascend Life has been informed that, in the opinion of the Securities and Exchange Commission, such indemnification is against public policy as expressed in the Securities Act of 1933 and is therefore unenforceable.
The statutory financial statements and financial statement schedules of MassMutual Ascend Life Insurance Company as of December 31, 2022, and for the year then ended, have been included herein in reliance upon the report of [ ], independent registered public accounting firm, appearing elsewhere herein, and upon the authority of said firm as experts in accounting and auditing.
The [ ] report dated April [ ], 2023 of MassMutual Ascend Life Insurance Company includes explanatory language that states that the financial statements are prepared by MassMutual Ascend Life Insurance Company using statutory accounting practices prescribed or permitted by the Ohio Department of Insurance, which is a basis of accounting other than U.S. generally accepted accounting principles. Accordingly, the [ ] audit report states that the financial statements are not presented fairly in accordance with U.S. generally accepted accounting principles and further states that those statements are presented fairly, in all material respects, in accordance with statutory accounting practices prescribed or permitted by the Ohio Department of Insurance.
The statutory-basis financial statements of MassMutual Ascend Life Insurance Company as of December 31, 2020 and for each of the two years in the period ended December 31, 2020, appearing in this Prospectus and Registration Statement have been audited by [ ], [address], independent auditors, as set forth in their report included thereon. These statutory-basis financial statements are included in this registration statement in reliance on the report of [ ] given on the authority of such firm as experts in accounting and auditing.
The [ ] report dated May 14, 2021 of MassMutual Ascend Life Insurance Company includes explanatory language that states that the financial statements are prepared by MassMutual Ascend Life Insurance Company using statutory accounting practices prescribed or permitted by the Ohio Department of Insurance, which is a basis of accounting other than U.S. generally accepted accounting principles. Accordingly, the [ ] audit report states that the financial statements are not presented fairly in accordance with U.S. generally accepted accounting principles and further states that those statements are presented fairly, in all material respects, in accordance with statutory accounting practices prescribed or permitted by the Ohio Department of Insurance.
We filed a Registration Statement with the Securities and Exchange Commission under the Securities Act of 1933 relating to the Contracts offered by this prospectus. This prospectus was filed as a part of the Registration Statement, but it does not constitute the complete Registration Statement. The Registration Statement contains further information relating to the Company and the Contracts. The Registration Statement and the exhibits thereto may be inspected and copied at the office of the Securities and Exchange Commission, located at 100 F Street, N.E., Washington, D.C., and may also be accessed at www.sec.gov. The Securities and Exchange Commission file number for the Contract is 333-[ ]
69
Statements in this prospectus discussing the content of the Contracts and other legal instruments are summaries. The actual documents are filed as exhibits to the Registration Statement. For a complete statement of the terms of the Contracts or any other legal document, refer to the appropriate exhibit to the Registration Statement.
In order to calculate the Daily Value Percentage of an Indexed Strategy, we determine the prices of the hypothetical options using a valuation model. The price of each option is stated as a percentage of the Index for the last Market Close on or before the first day of the Term.
| ATM Call Option Price (at-the-money call option) |
The ATM Call Option Price is the calculated price of a hypothetical call option that will pay the holder an amount equal to the percentage rise, if any, in the Index from the last Market Close on or before the start of the Term to the final Market Close of the Term.
| ATM Put Option Price (at-the-money put option) |
The ATM Put Option Price is the calculated price of a hypothetical put option that will pay the holder an amount equal to the percentage fall, if any, in the Index from the last Market Close on or before the start of the Term to the final Market Close of the Term.
| OTM Call Option Price (out-of-the-money call option) |
The OTM Call Option Price is the calculated price of a hypothetical call option that will pay the holder an amount equal to the percentage rise, if any, in the Index from the last Market Close on or before the start of the Term to the final Market Close of the Term, but only to the extent it exceeds the Cap for the Term.
| OTM Put Option Price (out-of-the-money put option) |
The OTM Put Option Price is the calculated price of a hypothetical put option that will pay the holder an amount equal to the percentage fall, if any, in the Index from the last Market Close on or before the start of the Term to the final Market Close of the Term, but only to the extent it exceeds the Buffer for the Term.
Valuation Model
We use a mathematical model to calculate the price of the hypothetical options in our formulas because direct prices of comparable options are generally not available. Options in the marketplace do not directly align with (1) the time remaining in a Term and (2) the strike prices for any of the hypothetical options used in the calculation of the Daily Value Percentage.
Valuation models are widely used for option pricing and the model we use is based on standard methods for valuing derivatives. The methodology used to value these options is determined solely by us and the results of our valuation model may vary, higher or lower, from other estimated valuations or the actual selling price of identical derivatives. Any variance between our valuations and other estimated or actual prices may be different from Indexed Strategy to Indexed Strategy and may also change from day to day. Our valuation model calculates the theoretical price of options using the following inputs: Index levels or prices, expected dividend yield, option strike prices, expected interest rates, time, and implied volatility of option prices. Below is a brief explanation of those model inputs, which we receive from third party vendors.
| Index Levels or Prices |
The initial Index level or price for a Term is the Index provided to us for the last Market Close on or before the first day of the Term. The current Index level or price is the Index provided to us for of the most recent Market Close. We rely on third parties, such as Index providers and financial reporting vendors, to provide us with the current Index level or price for the most recent Market Close.
| Dividend Yield (Div) |
Dividend Yield is the dividend yield to the end of the Term as of a calculation date where the dividend yield is (1) interpolated from yields or (2) implied from market data as reported by Bloomberg or another market source.
For the S&P 500 Index, the dividend yield will reduce the Index level and the applicable call option prices.
| Strike Price (K) |
Strike Price is a value that varies for each type of option.
ATM call option strike price = Index at the start of the Term
ATM put option strike price = Index at the start of the Term
70
OTM call option strike price = Index at the start of the Term multiplied by (1 + Cap). [For example, if the Cap is 8%, the OTM call option strike price is equal to the Index at the start of the Term multiplied by 1 + .08, or 1.08].
OTM put option strike price = Index at the start of the Term multiplied by (1 Buffer) for a Buffer Strategy or (1 + Floor) for a Floor Strategy. [For example, for a 10% Buffer Strategy, the OTM put option strike price is equal to the Index at the start of the Term multiplied by 1- .10, or .90; for a -10% Floor Strategy, the OTM put option strike price is equal to the Index at the start of the Term multiplied by 1 + -.10, or 0.90]
| Interest Rate (Rate) |
Interest Rate is a rate based on key derivative interest rates obtained from information provided by Bloomberg or another market source. These interest rates are obtained for maturities adjacent to the actual time remaining in the Term on the calculation date. We use interpolation to derive the rate used as our input for the model.
| Time (T) |
Time is the portion of the Term that remains as measured by the following formula.
Time = number of calendar days from calculation date to end of Term / number of calendar days in Term
| Implied Volatility (Vol) |
Volatility is the implied volatility of option prices. It is approximated daily using observed option prices as reported by Bloomberg or another market source. For each hypothetical option included in the calculation, we approximate the volatility of option prices by interpolating between (1) implied volatilities for similar options with the closest available time remaining and (2) strike prices.
Implied volatility varies with (1) how much time remains until the end of a Term, which is determined by using an expiration date for the designated option that corresponds to that time remaining and (2) the relationship between the strike price of that option and the value of the Index at the time of the calculation. This relationship is referred to as the moneyness of the option described above, and is calculated as the ratio of current price to strike price.
Direct market data for these inputs is generally not available because options on an Index that actually trade in the market have (1) specific maturity dates that are unlikely to precisely match the end date of a Term and (2) moneyness values that are unlikely to precisely match the moneyness of the designated option that we use in our calculations. Accordingly, we interpolate between the implied volatility quotes that are based on the actual maturities and moneyness values.
71
EXAMPLES: IMPACT OF WITHDRAWALS ON CONTRACT VALUES AND AMOUNTS REALIZED
These examples are intended to show you how a withdrawal from an Indexed Strategy before the end of the Term affects the Indexed Strategy values and amounts realized at the end of the Term.
Example A: Withdrawal When Index Rising Steadily
This example assumes:
| you allocate $50,000 to the S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy, $50,000 to the S&P 500 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy, and $50,000 to the S&P 500 6-Year 10% Buffer with Upside Participation Rate Strategy; |
| the Cap for the initial Term of the S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy is 10%; |
| the Upside Participation Rate for the initial Term of the S&P 500 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy is 75%; |
| the Upside Participation Rate for the Term of the S&P 500 6-Year 10% Buffer with Upside Participation Rate Strategy is 110%; |
| the S&P 500 is 1000 on the Term start date; |
| you request a $10,000 withdrawal on Day 146 when the Daily Value Percentage is 2.15% for the S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy, 2.33% for the S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy, and 10% for the S&P 500 6-year Term 10% Buffer with Participation Rate Strategy; |
| you do not take any other withdrawals during the initial Term; |
| the withdrawal is covered by the Free Withdrawal Allowance and therefore no Early Withdrawal Charges apply (If Early Withdrawal Charges did apply, the amounts realized at the end of the Term would be reduced by both the withdrawal and the amount of the Early Withdrawal Charge); |
| the S&P 500 is 1130 on the 1-year Term end date and the 6-Year Term end date; and |
| you have not made a Performance Lock election. |
Please note that even with a rising Index, the Daily Value Percentage may be negative or lower than the Index rise because the Net Option Price is not equal to the current Index price, and because the Daily Value Percentage calculation subtracts the Amortized Option Cost and Trading Cost from the Net Option Price.
Impact of $10,000 Withdrawal on Day 146 of Term |
S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy |
S&P 500 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy |
S&P 500 6-Year 10% Buffer with Upside Participation Rate Strategy | |||
Investment Base at Term Start |
$50,000 | $50,000 | $50,000 | |||
Daily Charges through withdrawal date |
$150 | $150 | $150 | |||
Remaining Investment Base |
$49,850 | $49,850 | $49,850 | |||
Daily Value Percentage on Withdrawal Date |
2.15% | 2.33% | 10.00% | |||
Dollar Amount of Increase on Withdrawal Date |
$49,850 x .0215 = $1,072 | $49,850 x .0233 = $1,162 | $49,850 x .10 = $4,985 | |||
Strategy Value before Withdrawal |
$49,850 + $1,072 = $50,922 | $49,850 + $1,162 = $51,012 | $49,850 + $4,985 = $54,835 | |||
Amount Withdrawn* |
$4,996 | $5,004 | $0 | |||
Withdrawal as Percentage of Strategy Value |
$4,996 / $50,922 = 9.81% | $5,004 / $51,012 = 9.81% | $0 / $54,835 = 0% | |||
Proportional Reduction in Investment Base |
$49,850 x .0981 = $4,890 | $49,850 x .0981 = $4,890 | $49,850 x 0 = $0 | |||
Investment Base after Withdrawal |
$49,850 - $4,890 = $44,959 | $49,850 - $4,890 = $44,959 | $49,850 - $0 = $49,850 | |||
Value at End of Term |
||||||
Investment Base after Withdrawal |
$44,959 | $44,959 | $49,850 | |||
Daily Charges From Withdrawal Date to Term End |
$203 | $203 | $2,058 | |||
Remaining Investment Base |
$44,757 | $44,757 | $47,792 | |||
Index at Term Start |
1000 | 1000 | 1000 | |||
Index at Term End |
1130 | 1130 | 1130 | |||
Rise in Index |
13% | 13% | 13% | |||
Cap |
10.00% | n/a | n/a | |||
Upside Participation Rate |
n/a | 75% | 110% | |||
Increase as a Percentage |
10% | 13% x 75% = 9.75% | 13% x 110% = 14.30% | |||
Dollar Amount of Increase |
$44,757 x .1000 = $4,476 | $44,757 x .0975 = $4,364 | $47,792 x .1430 = $6,834 | |||
Strategy Value at Term End |
$44,757 + $4,476 = $49,233 | $44,757 + $4,364 = $49,121 | $47,792 + $6,834 = $54,626 |
* | Note: The withdrawal is taken proportionally from each Indexed Strategy, based on the ratio of that Strategys value to the total value of all Indexed Strategies immediately before the withdrawal. In this example, the total value of all Indexed Strategies with 1-year Terms immediately before the withdrawal was $101,934 ($50,922 + $51,012). The S&P 500 1-year 50% Downside Participation Rate with Cap Strategy value was 49.96% of that total value ($50,922 / $101,394 = 49.96%), so 49.96% of the $10,000 withdrawal ($4,996) was taken from it. The S&P 500 with 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy value was 50.04% of that total value ($51,012 / $101,934 = 50.04%), so 50.04% of the $10,000 withdrawal ($5,004) was taken from it. Any withdrawal would only be taken from the S&P 500 6-Year 10% Buffer with Upside Participation Rate Strategy when no amounts remain in Indexed Strategies with a 1-year Term or a 2-year Term. For Contracts issued in Missouri, amounts taken from Indexed Strategies will be proportional without regard to Term length. |
72
In this example, you invested $50,000 in the S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy, $50,000 in the S&P 500 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy, and $50,000 in the S&P 500 6-Year 10% Buffer with Upside Participation Rate Strategy. At the end of the 1-year Term you realized $108,354 from the 1-year Strategies ($10,000 withdrawal plus the Strategy values of $49,233 and $49,121 at the end of the 1-year Term). Had no withdrawal occurred, your 1-year Strategy values at the end of the Term would have totaled $109,051 ($50,000 minus $375 in Daily Charges, plus a 10% increase for the S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy, and $50,000 minus $375 in Daily Charges, plus 9.75% increase for the S&P 500 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy.)
The hypothetical Strategy value for the 1-year Strategies ($109,051) exceeds the amount realized ($108,353) because the portion of the Investment Base withdrawn from each Strategy did not earn the index increase (10% and 9.75% respectively) it would have earned if it had been left in the respective Strategy for the entire Term.
At the end of the 6-year Term you realized $54,626 from the 6-year Strategy, which is the same amount you would have realized had no withdrawal occurred, because no amounts were withdrawn from the 6-year Strategy.
In this example, the S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy performed better than the S&P 500 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy because the Upside Participation Rate limited the increase more than the Cap did. The higher Upside Participation Rate for the S&P 500 6-Year 10% Buffer with Upside Participation Rate Strategy led it to a higher Strategy value at the end of a 6-year Term than the other Strategies had at the end of a 1-year Term.
Example B: Withdrawal When Index Falling Steadily
This example assumes:
| you allocate $50,000 to an S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy (or $50,000 to an S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy, either of which has a 50% Downside Participation Rate) and $50,000 to the S&P 500 6-Year 10% Buffer with Upside Participation Rate Strategy; |
| the S&P 500 is 1000 on the Term start date; |
| you request a $10,000 withdrawal on Day 146 when the Daily Value Percentage is -2.00% for the S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy and -12.00% for the S&P 500 6-Year 10% Buffer with Upside Participation Rate Strategy; |
| you do not take any other withdrawals during the initial Term; |
| the withdrawal is covered by the Free Withdrawal Allowance and therefore no Early Withdrawal Charges apply (If Early Withdrawal Charges did apply, the amounts realized at the end of the Term would be reduced by both the withdrawal and the amount of the Early Withdrawal Charge); |
| the S&P 500 is 800 on the 1-year Term end date and the 6-year Term end date; and |
| you have not made a Performance Lock election. |
Please note that the Daily Value Percentage may be more negative than the fall in the Index because the Net Option Price is not equal to the current Index price, and because the Daily Value Percentage calculation subtracts the Amortized Option Cost and Trading Cost from the Net Option Price.
Impact of $10,000 Withdrawal on Day 146 of Term |
S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy |
S&P 500 6-Year 10% Buffer with Upside Participation Rate Strategy | ||
Investment Base at Term Start |
$50,000 | $50,000 | ||
Daily Charges through withdrawal date |
$150 | $150 | ||
Remaining Investment Base |
$49,850 | $49,850 | ||
Daily Value Percentage on Withdrawal Date |
-2% | -12% | ||
Dollar Amount of Decrease on Withdrawal Date |
$49,850 x -.02 = $997 | $49,850 x -.12 = $5,982 | ||
Strategy Value before Withdrawal |
$49,850 - $997 = $48,853 | $49,850 - $5,982 = $43,868 | ||
Amount Withdrawn* |
$10,000 | $0 | ||
Withdrawal as Percentage of Strategy Value |
$10,000 / $48,853 = 20.47% | $0/ $43,868 = 0% | ||
Proportional Reduction in Investment Base |
$49,850 x .2047 = $10,204 | $49,850 x .0 = $0 | ||
Investment Base after Withdrawal |
$49,850 - $10,204 = $39,646 | $49,850 - $0 = $0 | ||
Value at End of Term |
||||
Investment Base after Withdrawal |
$39,646 | $49,850 | ||
Daily Charges From Withdrawal Date to Term End |
$179 | $2,058 | ||
Remaining Investment Base |
$39,467 | $47,792 | ||
Index at Term Start |
1000 | 1000 | ||
Index at Term End |
800 | 800 | ||
Fall in Index |
20% | 20% | ||
Downside Participation Rate |
50% | n/a | ||
Buffer |
n/a | 10% | ||
Decrease as a Percentage |
-20% x 50% = 10.00% | -20% - 10% = 10.00% | ||
Dollar Amount of Decrease |
$39,467 x .1000 = $3,947 | $47,792 x .1000 = $4,779 | ||
Strategy Value at Term End |
$39,467 - $3,947 = $35,520 | $47,792 - $4,743 = $43,013 |
73
* | Note: The withdrawal is taken proportionally from each Indexed Strategy, based on the ratio of that Strategys value to the total value of all Indexed Strategies immediately before the withdrawal. In this example, only one Indexed Strategy had a 1-year Term, so 100% of the $10,000 withdrawal was taken from it. Any withdrawal would only be taken from the S&P 500 6-year Term Buffer with Participation Rate Strategy value when no amounts remain in Indexed Strategies with a 1-year Term or a 2-year Term. For Contracts issued in Missouri, amounts taken from Indexed Strategies will be proportional without regard to Term length. |
In this example, you invested $50,000 in the S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy and $50,000 in the S&P 500 6-Year Buffer with Upside Participation Rate Strategy. At the end of the 1-year Term you realized $45,520 ($10,000 withdrawal plus the S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy value of $35,520 at the end of the 1-year Term). Had no withdrawal occurred, your Strategy value at the end of the 1-year Term would have totaled $44,663 ($50,000 minus $375 in Daily Charges, minus 10% decrease for the S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy).
At the end of the 6-year Term you realized $43,013, which is the same amount you would have realized had no withdrawal occurred, because no amounts were withdrawn from the 6-year Strategy.
The amount realized at the end of the 1-year Term for the S&P 500 1-year 50% Downside Participation Rate with Cap Strategy ($45,520) exceeds the hypothetical Strategy value at the end of the 1-year Term ($44,663) because the entire $10,000 withdrawal was taken from the 1-year Strategy, and that portion was not subject to the 10% decrease it would have suffered if it had been left in the Strategy for the entire 1-year Term.
The Strategy value for the S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy at the end of a 1-year term ($35,520) is lower than the S&P 500 6-Year Buffer with Upside Participation Rate Strategy at the end of a 6-year Term ($43,013), because the entire $10,000 withdrawal was taken from the 1-year Strategy.
.
74
Example C: Withdrawal When Index Rises
This example assumes:
| you allocate your entire $50,000 Purchase Payment to the S&P 500 1-year 50% Downside Participation Rate with Cap Strategy when the S&P 500 is 1900; |
| the Contract Effective Date and the Term start date are both April 6, 2024; |
| an Early Withdrawal Charge of 9% applies in the initial Term; |
| the Cap for the initial Term of that Strategy is 12%; |
| you request a $10,000 withdrawal on August 1, 2024 when the Daily Value Percentage is 1%; |
| you do not take any other withdrawals during the initial Term; |
| the S&P 500 is 2033 on the Term end date of April 6, 2025; and |
| you have not made a Performance Lock election. |
Term Start Date |
April 6, 2024 | |||||
Strategy Value |
$ | 50,000 | See Footnote 1 below. | |||
Investment Base |
$ | 50,000 | See Footnote 1 below. | |||
Cap for Term |
12 | % | See Footnote 2 below. | |||
Index |
1900 | |||||
Withdrawal Date |
August 30, 2024 | |||||
Daily Charges through Withdrawal Date |
$ | 150 | See Footnote 3 below | |||
Remaining Investment Base |
$ | 49,850 | See Footnote 4 below | |||
Daily Value Percentage on Withdrawal Date |
1 | % | ||||
Dollar Amount of Increase on Withdrawal Date |
$ | 499 | See Footnote 5 below. | |||
Strategy Value before Withdrawal |
$ | 50,349 | See Footnote 6 below. | |||
Amount of Withdrawal Requested |
$ | 10,000 | ||||
Free Withdrawal Allowance |
$ | 5,000 | See Footnote 7 below. | |||
Early Withdrawal Charge |
$ | 495 | See Footnote 8 below. | |||
Total Amount Withdrawn |
$ | 10,495 | See Footnote 9 below. | |||
Withdrawal as Percentage of Strategy Value |
20.84 | % | See Footnote 10 below. | |||
Proportional Reduction in Investment Base |
$ | 10,389 | See Footnote 10 below. | |||
Investment Base after Withdrawal |
$ | 39,461 | See Footnote 11 below. | |||
Strategy Value after Withdrawal |
$ | 39,854 | See Footnote 12 below. | |||
Term End Date |
April 6, 2025 | |||||
Daily Charges From Withdrawal Date to Term End |
$ | 178 | See Footnote 13 below | |||
Remaining Investment Base |
$ | 39,283 | See Footnote 14 below | |||
Index |
2033 | |||||
Rise in Index |
7.00 | % | See Footnote 15 below. | |||
Increase as a Percentage |
7.00 | % | See Footnote 16 below. | |||
Dollar Amount of Increase |
$ | 2,750 | See Footnote 16 below. | |||
Strategy Value at Term End |
$ | 42,033 | See Footnote 17 below. |
Footnote 1. On the Term start date, the Strategy value is equal to the amount applied to the Strategy on the Term start date. The amount applied on the Term start date is also the beginning Investment Base.
Footnote 2. The Cap is the largest rise in the Index over the Term taken into account to determine any increase at the end of a Term. In this example, the Cap is 12%, which means it will not affect the calculation of any increase unless the Index rises by more than 12%.
Footnote 3. The Daily Charge is the Investment Base from the prior day, multiplied by the Daily Charge rate. The amount in the table is the sum of the daily charges deducted from the Investment Base from the first day of the Term to the withdrawal date.
Formula | Investment Base on the Term Start Date (Investment Base on the Term Start Date x (1 Daily Fee Rate) ^ number of days elapsed prior to withdrawal) | |
Calculation | $50,000 ($50,000 x (1 0.0000206251) ^ 146) = $150 |
Footnote 4. The remaining Investment Base is equal to the beginning Investment Base minus the sum of the Daily Charges and minus the proportional reduction for any prior withdrawals and related Early Withdrawal Charges.
75
Formula | Beginning Investment Base sum of Daily Charges since Term Start Date) proportional reduction for any prior Withdrawals and related Early Withdrawal Charges = remaining Investment Base | |
Calculation | $50,000 - $150 - $0 = $49,850 |
Footnote 5. When the Daily Value Percentage is positive, we use the following formula in calculating the Strategy value before the end of the Term.
Formula | Investment Base x Daily Value Percentage = dollar amount of increase | |
Calculation | $49,850 x 1% = $499 |
Footnote 6. In this example, the Daily Value Percentage is positive on the withdrawal date and you have not taken any withdrawals before that date. This means the Strategy value on the withdrawal date is the Investment Base plus the increase for the Daily Value Percentage on that date.
Formula | Investment Base + dollar amount of increase = Strategy value | |
Calculation | $49,850 + $499 = $50,349 |
Footnote 7. The Free Withdrawal Allowance (FWA) for the first Contract Year is 10% of the Purchase Payment. The FWA for each subsequent Contract Year is 10% of the Account Value as of the most recent Contract Anniversary.
Formula | Purchase Payment x 10% = FWA for first Contract Year | |
Calculation | $50,000 x 10% = $5,000 |
Footnote 8. The Early Withdrawal Charge that would apply to your withdrawal is equal to the amount subject to the charge multiplied by the Early Withdrawal Charge rate (EWC rate). The amount subject to the charge includes the charge itself. The amount subject to the charge does not include the FWA. The EWC rate depends on the Contract Year. In this example, the withdrawal occurs in the first Contract Year, when the EWC rate is 9%. The Early Withdrawal Charge rate declines after each of the first six Contract Years. There is no Early Withdrawal Charge after Contract Year 6.
Formula | [(Requested withdrawal FWA) x EWC rate] / (1.00 EWC rate) = Early Withdrawal Charge | |
Calculation | [($10,000 - $5,000) x 9%] / (1.00 0.09) = $5,000 x 9% / 0.91 = $450 / 0.91 = $495 |
Footnote 9. When you request a withdrawal, you receive the amount you requested. If an Early Withdrawal Charge applies, we also withdraw an amount equal to the charge. This means that the total amount withdrawn from your Contract is equal to the amount you requested plus the applicable Early Withdrawal Charge.
Formula | Requested withdrawal + Early Withdrawal Charge = total amount withdrawn | |
Calculation | $10,000 + $495 = $10,495 |
Footnote 10. When you take a withdrawal, the deduction from the Investment Base taken is proportional to the reduction in the value of the Indexed Strategy due to the withdrawal. If the Strategy value on the withdrawal date is higher than the Investment Base, the proportional reduction in the Investment Base will be less than the total amount withdrawn.
Formula
Calculation |
Total amount withdrawn / Strategy value before withdrawal = withdrawal as percentage of Strategy value
$10,495 / $50,349 = 20.84% | |
Formula | Investment Base before withdrawal x withdrawal as percentage of Strategy value = proportional reduction in Investment Base | |
Calculation |
$49,850 x 20.84% = $10,389 |
Footnote 11. On the withdrawal date after the withdrawal, the Investment Base is equal to the Investment Base before the withdrawal minus the proportional reduction in the Investment Base for the withdrawal.
Formula | Investment Base before withdrawal proportional reduction in Investment Base for withdrawal = Investment Base after withdrawal | |
Calculation | $49,850 - $10,389 = $39,461 |
Footnote 12. On the withdrawal date, the Strategy value after the withdrawal is equal to Strategy value before the withdrawal minus the total amount withdrawn.
Formula | Strategy value before withdrawal total amount withdrawn = Strategy value after withdrawal | |
Calculation | $50,349 - $10,495 = $39,854 |
76
Footnote 13. The Daily Charge is the Investment Base from the prior day, multiplied by the Daily Charge rate. The amount in the table is the sum of the daily charges deducted from the Investment Base from the withdrawal date to the last day of the Term.
Formula | Investment Base after Previous Withdrawal (Investment Base after Previous Withdrawal x (1 Daily Fee Rate) ^ Number of Days Elapsed Since Previous Withdrawal) = Daily Charges | |
Calculation | $39,459 ($39,459 x (1 0.0000206251) ^ 219) = $178 |
Footnote 14. The remaining Investment Base is equal to the beginning Investment Base minus the sum of the Daily Charges and minus the proportional reduction for any prior withdrawals and related Early Withdrawal Charges.
Formula | Beginning Investment Base sum of Daily Charges since Term Start Date) proportional reduction for any prior Withdrawals and related Early Withdrawal Charges = remaining Investment Base | |
Calculation | $50,000 ($150 + $178) - $10,389 = $39,283 |
Footnote 15. The rise in the Index on the Term end date is equal to the percentage change in the Index measured from the Term start date to the Term end date.
Formula | (Index on Term end date Index on Term start date) / Index on Term start date = rise in Index | |
Calculation | (2033 1900) / 1900 = 7.00% |
Footnote 16. When the Index has risen over the Term, we use the following formulas to calculate the increase for a 50% Downside Participation Rate with Cap Strategy.
Formula | If the rise in Index is less than Cap, then rise in Index = increase percentage based on rise in Index | |
Calculation | 7% rise in Index < 12% cap, so increase percentage = 7.00% |
Formula | Investment Base x increase percentage based on rise in Index = dollar amount of increase based on rise in Index | |
Calculation | $39,283 x 7.00% = $2,750 |
Footnote 17. In this example, there has been a rise in the Index over the Term and you have taken a $10,000 withdrawal during the Term. This means the Strategy value at the end of the Term is the Investment Base on the Term end date plus the increase for the rise in the Index over the Term.
Formula | Investment Base on Term end date + dollar amount of increase based on rise in Index = Strategy value on Term end date | |
Calculation | $39,283 + $2,750 = $42,033 |
77
Example D: Withdrawal When Index Falls
This example assumes:
| you allocate your entire $50,000 Purchase Payment to the S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy when the S&P 500 is 1900; |
| the Contract Effective Date and the Term Start Date are both April 6, 2024; |
| an Early Withdrawal Charge of 9% applies in the initial Term; |
| you request a $10,000 withdrawal on August 30, 2024 when the Daily Value Percentage is -6%; |
| you do not take any other withdrawals during the initial Term; |
| the S&P 500 is 1748 on the Term end date of April 6, 2025; and |
| you have not made a Performance Lock election |
Term Start Date |
April 6, 2024 | |||||
Strategy Value |
$ | 50,000 | See Footnote 1 below. | |||
Investment Base |
$ | 50,000 | See Footnote 1 below. | |||
Downside Participation Rate |
50 | % | See Footnote 2 below. | |||
Index |
1900 | |||||
Withdrawal Date |
August 30, 2024 | |||||
Daily Charges through Withdrawal Date |
$ | 150 | See Footnote 3 below. | |||
Remaining Investment Base |
$ | 49,850 | See Footnote 4 below. | |||
Daily Value Percentage on Withdrawal Date |
-6 | % | ||||
Dollar Amount of Decrease on Withdrawal Date |
$ | 2,991 | See Footnote 5 below. | |||
Strategy Value before Withdrawal |
$ | 46,859 | See Footnote 6 below. | |||
Amount of Withdrawal Requested |
$ | 10,000 | ||||
Free Withdrawal Allowance |
$ | 5,000 | See Footnote 7 below. | |||
Early Withdrawal Charge |
$ | 495 | See Footnote 8 below. | |||
Total Amount Withdrawn |
$ | 10,495 | See Footnote 9 below. | |||
Withdrawal as Percentage of Strategy Value |
22.40 | % | See Footnote 10 below. | |||
Proportional Reduction in Investment Base |
$ | 11,166 | See Footnote 10 below. | |||
Investment Base after Withdrawal |
$ | 38,684 | See Footnote 11 below. | |||
Strategy Value after Withdrawal |
$ | 36,364 | See Footnote 12 below. | |||
Term End Date |
April 6, 2025 | |||||
Daily Charges From Withdrawal Date to Term End |
$ | 174 | See Footnote 13 below. | |||
Remaining Investment Base |
$ | 38,510 | See Footnote 14 below. | |||
Index |
1748 | |||||
Fall in Index |
8.00 | % | See Footnote 15 below. | |||
Decrease as a Percentage |
4.00 | % | See Footnote 16 below. | |||
Dollar Amount of Decrease |
$ | 1,540 | See Footnote 16 below. | |||
Strategy Value at Term End |
$ | 36,970 | See Footnote 17 below. |
Footnote 1. On the Term start date, the Strategy value is equal to the amount applied to the Strategy on the Term start date. The amount applied on the Term start date is also the beginning Investment Base.
Footnote 2. The Downside Participation Rate is your share of any fall in the Index over the Term taken into account to determine any decrease at the end of the Term. For each Term of each Indexed Strategy that we currently offer with this Contract, the Downside Participation Rate is 50%. The Downside Participation Rate will not change from Term to Term.
Footnote 3. The Daily Charge is the Investment Base from the prior day, multiplied by the Daily Charge rate. The amount in the table is the sum of the daily charges deducted from the Investment Base from the first day of the Term to the withdrawal date.
Formula | Investment Base on the Term Start Date (Investment Base on the Term Start Date x (1 Daily Fee Rate) ^ number of days elapsed prior to withdrawal) | |
Calculation | $50,000 - ($50,000 x (1 - 0.0000206251) ^ 146) = $150 |
Footnote 4. The remaining Investment Base is equal to the beginning Investment Base minus the sum of the Daily Charges and minus the proportional reduction for any prior withdrawals and related Early Withdrawal Charges.
Formula | Beginning Investment Base sum of Daily Charges since Term Start Date) proportional reduction for any prior Withdrawals and related Early Withdrawal Charges = remaining Investment Base | |
Calculation | $50,000 - $150 - $0 = $49,850 |
78
Footnote 5. When the Daily Value Percentage is negative, we use the following formula in calculating the Strategy value before the end of the Term.
Formula | - (Investment Base x Daily Value Percentage) = dollar amount of decrease | |
Calculation | - ($49,850 x -6%) = $2,991 |
Footnote 6. In this example, the Daily Value Percentage is negative on the withdrawal date and you have not taken any withdrawals before that date. This means the Strategy value on the withdrawal date is the Investment Base, minus the decrease for the Daily Value Percentage on that date.
Formula | Investment Base dollar amount of decrease = Strategy value | |
Calculation | $49,850 - $2,991 = $46,859 |
Footnote 7. The Free Withdrawal Allowance (FWA) for the first Contract Year is 10% of the Purchase Payment. The FWA for each subsequent Contract Year is 10% of the Account Value as of the most recent Contract Anniversary.
Formula | Purchase Payment x 10% = FWA for first Contract Year | |
Calculation | $50,000 x 10% = $5,000 |
Footnote 8. The Early Withdrawal Charge that would apply to your withdrawal is equal to the amount subject to the charge multiplied by the Early Withdrawal Charge rate (EWC rate). The amount subject to the charge includes the charge itself. The amount subject to the charge does not include the FWA. The EWC rate depends on the Contract Year. In this example, the withdrawal occurs in the first Contract Year, when the EWC rate is 9%. The Early Withdrawal Charge rate declines after each of the first six Contract Years. There is no Early Withdrawal Charge after Contract Year 6.
Formula | [(Requested withdrawal - FWA) x EWC rate] / (1.00 - EWC rate) = Early Withdrawal Charge | |
Calculation | [($10,000 - $5,000) x 9%] / (1.00 - 0.09) = $5,000 x 9% / 0.91 = $450 / 0.91 = $495 |
Footnote 9. When you request a withdrawal, you receive the amount you requested. If an Early Withdrawal Charge applies, we also withdraw an amount equal to the charge. This means that the total amount withdrawn from your Contract is equal to the amount you requested plus the applicable Early Withdrawal Charge.
Formula | Requested withdrawal + Early Withdrawal Charge = total amount withdrawn | |
Calculation | $10,000 + $495 = $10,495 |
Footnote 10. When you take a withdrawal, the deduction from the Investment Base taken is proportional to the reduction in the value of the Indexed Strategy due to the withdrawal. If the Strategy value on the withdrawal date is less than the Investment Base, the proportional reduction in the Investment Base will be more than the total amount withdrawn.
Formula | total amount withdrawn / Strategy value before withdrawal = withdrawal as percentage of Strategy value | |
Calculation | $10,495 / $46,859 = 22.40% | |
Formula | Investment Base before withdrawal x withdrawal as percentage of Strategy value = proportional reduction in Investment Base | |
Calculation | $49,850 x 22.40% = $11,166 |
Footnote 11. On the withdrawal date, the Investment Base after the withdrawal is equal to the Investment Base before the withdrawal minus the proportional reduction in the Investment Base for the withdrawal.
Formula | Investment Base before withdrawal - proportional reduction in Investment Base for withdrawal = Investment Base after withdrawal | |
Calculation | $49,850 - $11,166 = $38,684 |
Footnote 12. On the withdrawal date, the Strategy value after the withdrawal is equal to the Strategy value before the withdrawal minus the total amount withdrawn.
Formula | Strategy value before withdrawal - total amount withdrawn = Strategy value after withdrawal | |
Calculation | $46,859 - $10,495 = $36,364 |
Footnote 13. The Daily Charge is the Investment Base from the prior day, multiplied by the Daily Charge rate. The amount in the table is the sum of the daily charges deducted from the Investment Base from the withdrawal date to the last day of the Term.
Formula | Investment Base after Previous Withdrawal (Investment Base after Previous Withdrawal x (1 Daily Fee Rate) ^ Number of Days Elapsed Since Previous Withdrawal) = Daily Charges | |
Calculation | $38,685 - ($38,685 x (1 - 0.0000206251) ^ 219) = $174 |
79
Footnote 14. The remaining Investment Base is equal to the beginning Investment Base minus the sum of the Daily Charges and minus the proportional reduction for any prior withdrawals and related Early Withdrawal Charges.
Formula | Beginning Investment Base sum of Daily Charges since Term Start Date) proportional reduction for any prior Withdrawals and related Early Withdrawal Charges = remaining Investment Base | |
Calculation | $50,000 ($150 + $174) - $11,166 = $38,510 |
Footnote 15. The fall in the Index on the Term end date is equal to the negative of the percentage change in the Index measured from the Term start date to the Term end date.
Formula | - (Index on Term end date - Index on Term start date) / Index on Term start date | |
Calculation | - (1748 - 1900) / 1900 = 8.00% |
Footnote 16. When the Index has fallen over the Term, we use the following formula to calculate the decrease.
Formula | Fall in Index x Downside Participation Rate = decrease as a percentage based on fall in Index | |
Calculation | 8.00% x 50% = 4.00% |
Formula | Investment Base x decrease percentage based on fall in Index = dollar amount of decrease based on fall in Index | |
Calculation | $38,510 x 4.00% = $1,540 |
Footnote 17. In this example, there has been a fall in the Index over the Term and you have taken a $10,000 withdrawal during the Term. This means the Strategy value at the end of the Term is the Investment Base on the Term end date minus the decrease for the fall in the Index over the Term.
Formula | Investment Base on Term end date dollar amount of decrease based on fall in Index = Strategy value on Term end date | |
Calculation | $38,510 - $1,540 = $36,970 |
80
Example E: Amount Available for a Withdrawal When Index Rises Less Than Daily Charge Rate
The following example is intended to help you understand the amount that may be available for withdrawal when the Index rises at a rate lower than the amount of the Daily Charge over a Term. In such a scenario, Strategy Values will be lower at the end of a Term than they were at the beginning of the Term, despite the fact that the Index rose over that period.
This example assumes:
| you allocate a $50,000 Purchase Payment to the S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy when the S&P 500 is 1000; |
| you allocate a $50,000 Purchase Payment to the S&P 500 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy when the S&P 500 is 1000; |
| the Contract Effective Date and the Term Start Date are both April 6, 2024; |
| you do not take any withdrawals during the initial Term; and |
| the S&P 500 is 1005 on the Term end date of April 6, 2025. |
Term Start Date - April 6, 2024 |
S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy |
S&P 500 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy |
||||||||||
Strategy Value |
$ | 50,000 | $ | 50,000 | See Footnote 1 below. | |||||||
Investment Base |
$ | 50,000 | $ | 50,000 | See Footnote 1 below. | |||||||
Cap for Term |
10 | % | n/a | See Footnote 2 below. | ||||||||
Upside Participation Rate for Term |
n/a | 75 | % | See Footnote 3 below. | ||||||||
Index |
1000 | 1000 | ||||||||||
Term End Date - April 6, 2025 |
||||||||||||
Daily Charges From Term Start Date to Term End Date |
$ | 375 | $ | 375 | See Footnote 4 below. | |||||||
Remaining Investment Base |
$ | 49,625 | $ | 49,625 | See Footnote 5 below. | |||||||
Index at Term Start Date |
1000 | 1000 | ||||||||||
Index at Term End Date |
1005 | 1005 | ||||||||||
Rise in Index |
0.50 | % | 0.50 | % | See Footnote 6 below. | |||||||
Increase as a Percentage |
0.500 | % | 0.375 | % | See Footnote 7 below. | |||||||
Dollar Amount of Increase |
$ | 248 | $ | 186 | See Footnote 8 below. | |||||||
Strategy Value at Term End |
$ | 49,873 | $ | 49,811 | See Footnote 9 below. |
Footnote 1. On the Term start date, the Strategy value is equal to the amount applied to the Strategy on the Term start date. The amount applied on the Term start date is also the beginning Investment Base.
Footnote 2. The Cap is the largest rise in the Index over the Term taken into account to determine any increase at the end of a Term. In this example, the Cap is 10%, which means it will not affect the calculation of any increase unless the Index rises by more than 10%.
Footnote 3. The Upside Participation Rate is your share of any rise in the Index over the Term taken into account to determine the Strategy value at the end of the Term. In this example, the Upside Participation Rate is 75%, which means the calculation of any increase will include 75% of any Index rise.
Footnote 4. When no withdrawals are taken over the course of a Term, the Daily Charges through the Term End Date are equal to the Investment Base on the Term Start Date times the annual rate at which the Daily Charge compounds.
Formula | Investment Base on Term Start Date x annual rate | |
Calculation | $50,000 x 0.75% = $375 |
Footnote 5. The remaining Investment Base is equal to the beginning Investment Base minus the sum of the Daily Charges and minus the proportional reduction for any prior withdrawals and related Early Withdrawal Charges.
Formula | Beginning Investment Base sum of Daily Charges since Term Start Date proportional reduction for any prior Withdrawals and related Early Withdrawal Charges = remaining Investment Base | |
Calculation | $50,000 - $375 - $0 = $49,625 |
81
Footnote 6. The Rise in Index on the Term End Date is equal to the percentage change in the Index Value measured from the Term Start Date to the Term End Date.
Formula | (Index Value on Term End Date - Index Value on Term Start Date) / Index Value on Term Start Date | |
Calculation | (1005 - 1000) / 1000 = 0.50% |
Footnote 7.
When the Index has risen over the Term, we use the following formulas in calculating the increase for the S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy.
Formula | If the rise in Index is less than Cap, then rise in Index = increase percentage based on rise in Index | |
Calculation | 0.50% rise in Index < 10% cap, so increase percentage = 0.50% |
When the Index has risen over the Term, we use the following formulas to calculate the increase for a Strategy with an Upside Participation Rate.
Formula | Rise in Index for Term x Upside Participation Rate for Term = Increase as a Percentage | |
Calculation | 0.50% x 75% = 0.375% |
Footnote 8.
When the Index has risen over the Term, we use the following formula to calculate the increase.
Formula | Investment Base x increase percentage based on rise in Index = dollar amount of increase based on rise in Index | |
Calculation |
S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy: |
$49,625 x 0.50% = $248 | |
S&P 500 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$49,625 x 0.375% = $186 |
Footnote 9. In this example, there has been a rise in the Index over the Term. This means the Strategy value at the end of the Term is the Investment Base on the Term end date plus the increase for the rise in the Index over the Term.
Formula | Investment Base on Term end date + dollar amount of increase based on rise in Index = Strategy value on Term end date | |
Calculation |
S&P 500 1-Year 50% Downside Participation Rate with Cap : |
$49,625 + $248 = $49,873 | |
S&P 500 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$49,625 + $186 = $49,811 |
82
Example F: Amount Available for a Withdrawal After 6 Years When Index Rises Steadily
The following example is intended to help you understand the amount that may be available for withdrawal for Indexed Strategies that have different Term lengths after a six-year period when the Index rises at a steady rate. In many market conditions, at the end of six years an Indexed Strategy with a six-year Term will outperform Indexed Strategies with shorter Terms that use the same Index.
This example assumes:
| you allocate a $50,000 Purchase Payment to the S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy when the S&P 500 is 1000.00, and the Cap is 10%; |
| you allocate a $50,000 Purchase Payment to the S&P 500 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy when the S&P 500 is 1000, and the Upside Participation Rate is 75%; |
| you allocate a $50,000 Purchase Payment to the S&P 500 6-Year Term 10% Buffer with Upside Participation Rate when the S&P 500 is 1000.00, and the Upside Participation Rate is 130%; |
| the Contract Effective Date and the Term start date are both April 6, 2024, so that the Contract Years and Term Years align; |
| you do not take any withdrawals during the first six Contract Years; |
| amounts allocated to the 1-year strategies are rolled over into the same Indexed Strategy at the end of each 1-year Term, and the Caps and Upside Participation Rates do not change; and |
| on April 6, 2025, the S&P 500 is at 1040.00 and the 6-year Strategy Daily Value Percentage is -2.30%; on April 6, 2026, the S&P 500 is at 1081.60 and the 6-year Strategy Daily Value Percentage is 4.60%; on April 6, 2027, the S&P 500 is at 1124.86 and the 6-year Strategy Daily Value Percentage is 11.70%; on April 6, 2028, the S&P 500 is at 1169.86 and the 6-year Strategy Daily Value Percentage is 19.10%; on April 6, 2029, the S&P 500 is at 1216.65 and the 6-year Strategy Daily Value Percentage is 26.70%; and on April 6, 2030, the S&P 500 is at 1265.32; and |
| you have not made a Performance Lock election |
S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy |
S&P 500 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy |
S&P 500 6-Year 10% Buffer with Upside Participation Rate Strategy |
||||||||||||
Year 1 |
||||||||||||||
Strategy Value - April 6, 2024 |
$ | 50,000 | $ | 50,000 | $ | 50,000 | See Footnote 1 below. | |||||||
Investment Base - April 6, 2024 |
$ | 50,000 | $ | 50,000 | $ | 50,000 | See Footnote 1 below. | |||||||
Daily Charges for Period |
$ | 375 | $ | 375 | $ | 375 | See Footnote 2 below. | |||||||
Remaining Investment Base - April 6, 2025 |
$ | 49,625 | $ | 49,625 | $ | 49,625 | See Footnote 3 below. | |||||||
Rise in Index for Period |
4.00 | % | 4.00 | % | n/a | See Footnote 4 below. | ||||||||
Cap for Period |
10 | % | n/a | n/a | See Footnote 5 below. | |||||||||
Participation Rate for Period |
n/a | 75 | % | n/a | See Footnote 6 below. | |||||||||
Increase as a Percentage |
4.00 | % | 3.00 | % | -2.30 | % | See Footnote 7 below. | |||||||
Dollar Amount of Increase |
$ | 1,985 | $ | 1,489 | -$ | 1,141 | See Footnote 8 below. | |||||||
Strategy Value April 6, 2025 |
$ | 51,610 | $ | 51,114 | $ | 48,484 | See Footnote 9 below. | |||||||
Year 2 |
||||||||||||||
Investment Base April 6, 2025 |
$ | 51,610 | $ | 51,114 | $ | 49,625 | See Footnote 9 below. | |||||||
Daily Charges for Period |
$ | 387 | $ | 383 | $ | 372 | See Footnote 10 below. | |||||||
Remaining Investment Base April 6, 2026 |
$ | 51,223 | $ | 50,731 | $ | 49,253 | See Footnote 11 below. | |||||||
Rise in Index for Period |
4.00 | % | 4.00 | % | n/a | See Footnote 12 below. | ||||||||
Cap for Period |
10 | % | n/a | n/a | See Footnote 13 below. | |||||||||
Participation Rate for Period |
n/a | 75 | % | n/a | See Footnote 14 below. | |||||||||
Increase as a Percentage |
4.00 | % | 3.00 | % | 4.60 | % | See Footnote 15 below. | |||||||
Dollar Amount of Increase |
$ | 2,049 | $ | 1,522 | $ | 2,266 | See Footnote 16 below. | |||||||
Strategy Value - April 6, 2026 |
$ | 53,272 | $ | 52,253 | $ | 51,519 | See Footnote 17 below. | |||||||
Year 3 |
||||||||||||||
Investment Base - April 6, 2026 |
$ | 53,272 | $ | 52,253 | $ | 49,253 | See Footnote 17 below. | |||||||
Daily Charges for Period |
$ | 400 | $ | 392 | $ | 369 | See Footnote 18 below. | |||||||
Remaining Investment Base - April 6, 2027 |
$ | 52,872 | $ | 51,861 | $ | 48,884 | See Footnote 19 below. | |||||||
Rise in Index for Period |
4.00 | % | 4.00 | % | n/a | See Footnote 20 below. | ||||||||
Cap for Period |
10 | % | n/a | n/a | See Footnote 21 below. | |||||||||
Participation Rate for Period |
n/a | 75 | % | n/a | See Footnote 22 below. | |||||||||
Increase as a Percentage |
4.00 | % | 3.00 | % | 11.70 | % | See Footnote 23 below. | |||||||
Dollar Amount of Increase |
$ | 2,115 | $ | 1,556 | $ | 5,719 | See Footnote 24 below. | |||||||
Strategy Value April 6, 2027 |
$ | 54,987 | $ | 53,417 | $ | 54,603 | See Footnote 25 below. |
83
S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy |
S&P 500 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy |
S&P 500 6-Year 10% Buffer with Upside Participation Rate Strategy |
||||||||||||
Year 4 |
||||||||||||||
Investment Base April 6, 2027 |
$ | 54,987 | $ | 53,417 | $ | 48,884 | See Footnote 25 below. | |||||||
Daily Charges for period |
$ | 412 | $ | 401 | $ | 367 | See Footnote 26 below. | |||||||
Remaining Investment Base April 6, 2028 |
$ | 54,575 | $ | 53,016 | $ | 48,517 | See Footnote 27 below. | |||||||
Rise in Index for Period |
4.00 | % | 4.00 | % | n/a | See Footnote 28 below. | ||||||||
Cap for Period |
10 | % | n/a | n/a | See Footnote 29 below. | |||||||||
Participation Rate for Period |
n/a | 75 | % | n/a | See Footnote 30 below. | |||||||||
Increase as a Percentage |
4.00 | % | 3.00 | % | 19.10 | % | See Footnote 31 below. | |||||||
Dollar Amount of Increase |
$ | 2,183 | $ | 1,590 | $ | 9,267 | See Footnote 32 below. | |||||||
Strategy Value April 6, 2028 |
$ | 56,758 | $ | 54,606 | $ | 57,784 | See Footnote 33 below. | |||||||
Year 5 |
||||||||||||||
Investment Base April 6, 2028 |
$ | 56,758 | $ | 54,606 | $ | 48,517 | See Footnote 33 below. | |||||||
Daily Charges for Period |
$ | 426 | $ | 410 | $ | 364 | See Footnote 34 below. | |||||||
Remaining Investment Base April 6, 2029 |
$ | 56,332 | $ | 54,196 | $ | 48,153 | See Footnote 35 below. | |||||||
Rise in Index for Period |
4.00 | % | 4.00 | % | n/a | See Footnote 36 below. | ||||||||
Cap for Period |
10 | % | n/a | n/a | See Footnote 37 below. | |||||||||
Participation Rate for Period |
n/a | 75 | % | n/a | See Footnote 38 below. | |||||||||
Increase as a Percentage |
4.00 | % | 3.00 | % | 26.70 | % | See Footnote 39 below. | |||||||
Dollar Amount of Increase |
$ | 2,253 | $ | 1,626 | $ | 12,857 | See Footnote 40 below. | |||||||
Strategy Value April 6, 2029 |
$ | 58,585 | $ | 55,822 | $ | 61,010 | See Footnote 41 below. | |||||||
Year 6 |
||||||||||||||
Investment Base April 6, 2029 |
$ | 58,585 | $ | 55,822 | $ | 48,153 | See Footnote 41 below. | |||||||
Daily Charges for Period |
$ | 439 | $ | 419 | $ | 361 | See Footnote 42 below. | |||||||
Remaining Investment Base April 6, 2030 |
$ | 58,146 | $ | 55,403 | $ | 47,792 | See Footnote 43 below. | |||||||
Rise in Index for Period |
4.00 | % | 4.00 | % | 26.53 | % | See Footnote 44 below. | |||||||
Cap for Period |
10 | % | n/a | n/a | See Footnote 45 below. | |||||||||
Participation Rate for Period |
n/a | 75 | % | 130 | % | See Footnote 46 below. | ||||||||
Increase as a Percentage |
4.00 | % | 3.00 | % | 34.49 | % | See Footnote 47 below. | |||||||
Dollar Amount of Increase |
$ | 2,326 | $ | 1,662 | $ | 16,483 | See Footnote 48 below. | |||||||
Strategy Value - April 6, 2030 |
$ | 60,472 | $ | 57,065 | $ | 64,275 | See Footnote 49 below. |
Footnote 1. At the beginning of the first Term, the Strategy value is equal to the amount applied to the Strategy on the Term start date. The amount applied on the Term start date is also the beginning Investment Base.
Footnote 2. When no withdrawals are taken over the course of a 1-year Term, the Daily Charges through the Term are equal to the Investment Base on the Term start date times the annual rate at which the Daily Charge compounds. When no withdrawals are taken over the course of a year that is part of a 6-year Term, the Daily Charges for the year are equal to the Investment Base at the Term start date or the most recent Term start date anniversary times the annual rate at which the Daily Charge compounds.
Formula | Investment Base on Term start date or anniversary x annual rate | |
Calculation | $50,000 x 0.75% = $375 for all Indexed Strategies |
Footnote 3. The remaining Investment Base is equal to the beginning Investment Base minus the sum of the Daily Charges and minus the proportional reduction for any prior withdrawals and related Early Withdrawal Charges.
Formula | Beginning Investment Base sum of Daily Charges since beginning of year proportional reduction for any prior Withdrawals and related Early Withdrawal Charges = remaining Investment Base | |
Calculation | $50,000 - $375 - $0 = $49,625 for all Indexed Strategies |
Footnote 4. For the 1-year Strategies, the value at the first Term is based on the rise or fall of the Index over the Term. The rise or fall in the Index for the Term is equal to the percentage change in the Index Value measured from the Term start date to the Term end date.
Formula | (Index Value on Term end date - Index Value on Term start date) / Index Value on Term start date | |
Calculation | (1040.00 1000.00) / 1000.00 = 4.00% |
84
For the 6-year Strategy, the value at the end of Year 1 is based on the Daily Value Percentage, and not the rise or fall in the Index.
Footnote 5. The Cap is the largest rise in the Index over a Term taken into account to determine any increase at the end of the Term. In this example, the S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy has a Cap of 10% for the first Term, which means it will not affect the calculation of any increase unless the Index rises by more than 10% for the Term. The S&P 500 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy and the S&P 500 6-Year 10% Buffer with Upside Participation Rate Strategy do not have a Cap.
Footnote 6. The Upside Participation Rate is your share of any rise in the Index over a Term taken into account to determine the Strategy value at the end of the Term. In this example, the S&P 500 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy has an Upside Participation Rate of 75% for the first Term, which means the calculation of any increase will include 75% of any Index rise for the Term. The S&P 500 6-Year 10% Buffer with Upside Participation Rate Strategy did not complete a Term in Year 1, so no Upside Participation Rate will be applied when determining the Strategy value at the end of Year 1. The S&P 500 1-year 50% Downside Participation Rate with Cap Strategy does not have an Upside Participation Rate.
Footnote 7.
When the Index has risen over a Term, we use the following formulas to calculate the increase for the 1-year Strategy with a Cap.
Formula | If the rise in Index is less than Cap, then rise in Index = increase percentage based on rise in Index | |
Calculation | 4.0% rise in Index < 10% cap, so increase percentage = 4.0% |
When the Index has risen over a Term, we use the following formulas to calculate the increase for the 1-year Strategy with an Upside Participation Rate.
Formula | Rise in Index for Term x Upside Participation Rate for Term = Increase as a Percentage | |
Calculation | 4.0% x 75% = 3.0% |
For the S&P 500 6-year 10% Buffer with Upside Participation Rate Strategy, the Upside Participation Rate only applies at the end of the 6-year Term. At the end of Year 1, the Strategy Value is determined based on the Daily Value Percentage. The Daily Value Percentage may be more or less than the cumulative rise or fall of the Index since the Term start date, and it may be negative even when the Index has risen. In our example, the Daily Value Percentage at the end of Year 1 is -2.30%.
Footnote 8.
For a 1-year Strategy, when the Index has risen over the Term, we use the following formula to calculate the increase.
Formula | Remaining Investment Base x increase percentage based on rise in Index = dollar amount of increase based on rise in Index | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$49,625 x 4.00% = $1,985 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$49,625 x 3.00% = $1,489 |
For the 6-year Strategy, when the Daily Value Percentage is negative, we use the following formula to calculate the amount of the decrease.
Formula | Remaining Investment Base x Daily Value Percentage = dollar amount of change based on Daily Value Percentage | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$49,625 x -2.30% = -$1,141 |
Footnote 9. In this example, for the 1-year Strategies, there has been a rise in the Index over the first Term. We use the following formula to calculate the Strategy value at the end of Year 1.
Formula | Remaining Investment Base on Term end date + dollar amount of increase based on rise in Index = Strategy value on Term end date | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$49,625 + $1,985 = $51,610 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$49,625 + $1,489 = $51,114 |
85
For the 6-year Strategy, the Daily Value Percentage is negative at the end of Year 1. We use the following formula to calculate the Strategy value.
Formula | Remaining Investment Base on valuation date - dollar amount of decrease based on Daily Value Percentage = current Strategy value | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$49,625 $1,141 = $48,484 |
For the 1-year Strategies, the Strategy value at the end of the first Term is also the Investment Base at the beginning of the second Term. For the 6-year Strategy, the existing Investment Base is carried forward because it is not the end of a Term.
Footnote 10. When no withdrawals are taken over the course of a 1-year Term, the Daily Charges through the Term end date are equal to the Investment Base on the Term start date times the annual rate at which the Daily Charge compounds. When no withdrawals are taken over the course of a year that is part of a 6-year Term, the Daily Charges for the year are equal to the Investment Base at the Term start date or the most recent Term start date anniversary times the annual rate at which the Daily Charge compounds.
Formula | Investment Base on Term start date or anniversary x annual rate | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$51,610 x 0.75% = $387 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: | $51,114 x 0.75% = $383 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$49,625 x 0.75% = $372 |
Footnote 11. The remaining Investment Base is equal to the beginning Investment Base minus the sum of the Daily Charges and minus the proportional reduction for any prior withdrawals and related Early Withdrawal Charges.
Formula | Beginning Investment Base sum of Daily Charges since beginning of year proportional reduction for any prior Withdrawals and related Early Withdrawal Charges = remaining Investment Base | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$51,160 $387 - $0 = $51,223 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: | $51,114 $383 - $0 = $50,731 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$49,625 $372 - $0 = $49,253 |
Footnote 12. For a 1-year Strategy, the value at the end of the second Term is based on the rise or fall in the index over the Term. The rise or fall in Index for the Term is equal to the percentage change in the Index Value measured from the Term start date to the Term end date.
Formula | (Index Value on Term end date - Index Value on Term start date) / Index Value on Term start date | |
Calculation | (1081.60 1040.00) / 1040.00 = 4.00% |
For the 6-year Strategy, the value at the end of Year 2 is based on the Daily Value Percentage, and not the rise or fall in the Index.
Footnote 13. The Cap is the largest rise in the Index over a Term taken into account to determine any increase at the end of the Term. In this example, the 1-year 50% Downside Participation Rate with Cap Strategy has a Cap of 10% for the second Term, which means it will not affect the calculation of any increase unless the Index rises by more than 10% for the Term. The 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy and the 6-year 10% Buffer with Upside Participation Rate Strategy do not have a Cap.
Footnote 14. The Upside Participation Rate is your share of any rise in the Index over a Term taken into account to determine the Strategy value at the end of the Term. In this example, the 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy has an Upside Participation Rate of 75% for the second Term, which means the calculation of any increase will include 75% of any Index rise for the Term. The 6-year 10% Buffer with Upside Participation Rate Strategy did not complete a Term in Year 2, so no Upside Participation Rate will be applied when determining the Strategy value at the end of Year 2. The 1-year 50% Downside Participation Rate with Cap Strategy does not have an Upside Participation Rate.
86
Footnote 15.
When the Index has risen over a Term, we use the following formulas to calculate the increase for the 1-year Strategy with a Cap.
Formula | If the rise in Index is less than Cap, then rise in Index = increase percentage based on rise in Index | |
Calculation | 4.00% rise in Index < 10% cap, so increase percentage = 4.00% |
When the Index has risen over a Term, we use the following formulas to calculate the increase for the 1-year Strategy with an Upside Participation Rate.
Formula | Rise in Index for Term x Upside Participation Rate for Term = Increase as a Percentage | |
Calculation | 4.00% x 75% = 3.00% |
For the S&P 500 6-year 10% Buffer with Upside Participation Rate Strategy, the Upside Participation Rate only applies at the end of the 6-year Term. At the end of Year 1, the Strategy Value is determined based on the Daily Value Percentage. The Daily Value Percentage may be more or less than the cumulative rise or fall of the Index since the Term start date, and it may be negative even when the Index has risen. In our example, the Daily Value Percentage at the end of Year 2 is 4.60%.
Footnote 16.
For a 1-year Strategy, when the Index has risen over the Term, we use the following formula to calculate the increase.
Formula | Remaining Investment Base x increase percentage based on rise in Index = dollar amount of increase based on rise in Index | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$51,223 x 4.00% = $2,049 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: | $50,731 x 3.00% = $1,522 |
For the 6-year Strategy, when the Daily Value Percentage is positive, we use the following formula to calculate the amount of the increase.
Formula | Remaining Investment Base x Daily Value Percentage = dollar amount of increase based on Daily Value Percentage | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$49,253 x 4.60% = $2,266 |
Footnote 17. In this example, for the 1-year Strategies, there has been a rise in the Index over the second Term. We use the following formula to calculate the Strategy value at the end of Year 2.
Formula | Remaining Investment Base on Term end date + dollar amount of increase based on rise in Index = Strategy value on Term end date | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$51,223 + $2,049 = $53,272 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: | $50,731 + $1,522 = $52,253 |
For the 6-year Strategy, the Daily Value Percentage is positive at the end of Year 2. We use the following formula to calculate the Strategy value.
Formula | Remaining Investment Base on valuation date + dollar amount of increase based on Daily Value Percentage = current Strategy value | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$49,253 + $2,266 = $51,519 |
87
For the 1-year Strategies, the Strategy value at the end of the second Term is also the Investment Base at the beginning of the third Term. For the 6-year Strategy, the existing Investment Base is carried forward because it is not the end of a Term.
Footnote 18. When no withdrawals are taken over the course of a 1-year Term, the Daily Charges through the Term end date are equal to the Investment Base on the Term start date times the annual rate at which the Daily Charge compounds. When no withdrawals are taken over the course of a year that is part of a 6-year Term, the Daily Charges for the year are equal to the Investment Base at the Term start date or the most recent Term start date anniversary times the annual rate at which the Daily Charge compounds.
Formula | Investment Base on Term start date or anniversary x annual rate | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$53,272 x 0.75% = $400 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: | $52,253 x 0.75% = $392 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$49,253 x 0.75% = $369 |
Footnote 19. The remaining Investment Base is equal to the beginning Investment Base minus the sum of the Daily Charges and minus the proportional reduction for any prior withdrawals and related Early Withdrawal Charges.
Formula | Beginning Investment Base sum of Daily Charges since beginning of year proportional reduction for any prior Withdrawals and related Early Withdrawal Charges = remaining Investment Base | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$53,272 - $400 - $0 = $52,872 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: | $52,253 - $392 - $0 = $51,861 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$49,253 - $369 - $0 = $48,884 |
Footnote 20. For a 1-year Strategy, the value at the end of the third Term is based on the rise or fall in the index over the Term. The rise or fall in Index for the Term is equal to the percentage change in the Index Value measured from the Term start date to the Term end date.
Formula | (Index Value on Term end date - Index Value on Term start date) / Index Value on Term start date | |
Calculation | (1124.86- 1081.60) / 1081.60 = 4.00% |
For the 6-year Strategy, the value at the end of Year 3 is based on the Daily Value Percentage, and not the rise or fall in the Index.
Footnote 21. The Cap is the largest rise in the Index over a Term taken into account to determine any increase at the end of the Term. In this example, the 1-year 50% Downside Participation Rate with Cap Strategy has a Cap of 10% for the third Term, which means it will not affect the calculation of any increase unless the Index rises by more than 10% for the Term. The 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy and the 6-year 10% Buffer with Upside Participation Rate Strategy do not have a Cap.
Footnote 22. The Upside Participation Rate is your share of any rise in the Index over a Term taken into account to determine the Strategy value at the end of the Term. In this example, the 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy has an Upside Participation Rate of 75% for the third Term, which means the calculation of any increase will include 75% of any Index rise for the Term. The 6-year 10% Buffer with Upside participation Rate Strategy did not complete a Term in Year 3, so no Upside Participation Rate will be applied when determining the Strategy value at the end of Year 3. The 1-year 50% Downside Participation Rate with Cap Strategy does not have an Upside Participation Rate.
Footnote 23.
When the Index has risen over a Term, we use the following formulas to calculate the increase for the 1-year Strategy with a Cap.
Formula | If the rise in Index is less than Cap, then rise in Index = increase percentage based on rise in Index | |
Calculation | 4.00% rise in Index < 10% cap, so increase percentage = 4.00% |
88
When the Index has risen over a Term, we use the following formulas to calculate the increase for the 1-year Strategy with an Upside Participation Rate.
Formula | Rise in Index for Term x Upside Participation Rate for Term = Increase as a Percentage | |
Calculation | 4.00% x 75% = 3.00% |
For the S&P 500 6-year 10% Buffer with Upside Participation Rate Strategy, the Upside Participation Rate only applies at the end of the 6-year Term. At the end of Year 1, the Strategy Value is determined based on the Daily Value Percentage. The Daily Value Percentage may be more or less than the cumulative rise or fall of the Index since the Term start date, and it may be negative even when the Index has risen. In our example, the Daily Value Percentage at the end of Year 3 is 11.70%.
Footnote 24.
For a 1-year Strategy, when the Index has risen over the Term, we use the following formula to calculate the increase.
Formula | Remaining Investment Base x increase percentage based on rise in Index = dollar amount of increase based on rise in Index | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$52,872 x 4.00% = $2,115 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$51,861 x 3.00% = $1,556 |
For the 6-year Strategy, when the Daily Value Percentage is positive, we use the following formula to calculate the amount of the increase.
Formula | Remaining Investment Base x Daily Value Percentage = dollar amount of increase based on Daily Value Percentage | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,884 x 11.70% = $5,719 |
Footnote 25. In this example, for the 1-year Strategies, there has been a rise in the Index over the third Term. We use the following formula to calculate the Strategy value at the end of Year 3.
Formula | Remaining Investment Base on Term end date + dollar amount of increase based on rise in Index = Strategy value on Term end date | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$52,872 + $2,115 = $54,987 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: | $51,861 + $1,556 = $53,417 |
For the 6-year Strategy, the Daily Value Percentage is positive at the end of Year 3. We use the following formula to calculate the Strategy value.
Formula | Remaining Investment Base on valuation date + dollar amount of increase based on Daily Value Percentage = current Strategy value | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,884 + $5,719 = $54,603 |
For the 1-year Strategies, the Strategy value at the end of the third Term is also the Investment Base at the beginning of the fourth Term. For the 6-year Strategy, the existing Investment Base is carried forward because it is not the end of a Term.
Footnote 26. When no withdrawals are taken over the course of a 1-year Term, the Daily Charges through the Term are equal to the Investment Base on the Term start date times the annual rate at which the Daily Charge compounds. When no withdrawals are taken over the course of a year that is part of a 6-year Term, the Daily Charges for the year are equal to the Investment Base at the Term start date or the most recent Term start date anniversary times the annual rate at which the Daily Charge compounds.
Formula | Investment Base on Term start date or anniversary x annual rate | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$54,987 x 0.75% = $412 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$53,417 x 0.75% = $401 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,884 x 0.75% = $367 |
89
Footnote 27. The remaining Investment Base is equal to the beginning Investment Base minus the sum of the Daily Charges and minus the proportional reduction for any prior withdrawals and related Early Withdrawal Charges.
Formula | Beginning Investment Base sum of Daily Charges since beginning of year proportional reduction for any prior Withdrawals and related Early Withdrawal Charges = remaining Investment Base | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$54,987 $412 - $0 = $54,575 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: | $53,416 $401 - $0 = $53,016 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,883 $367 - $0 = $48,517 |
Footnote 28. For a 1-year Strategy, the value at the end of the fourth Term is based on the rise or fall in the index over the Term. The rise or fall in Index for the Term is equal to the percentage change in the Index Value measured from the Term start date to the Term end date.
Formula | (Index Value on Term end date - Index Value on Term start date) / Index Value on Term start date | |
Calculation | (1169.86 - 1125) / 1124.86 = 4.00% |
For the 6-year Strategy, the value at the end of Year 4 is based on the Daily Value Percentage, and not the rise or fall in the Index.
Footnote 29. The Cap is the largest rise in the Index over a Term taken into account to determine any increase at the end of the Term. In this example, the 1-year 50% Downside Participation Rate with Cap Strategy has a Cap of 10% for the fourth Term, which means it will not affect the calculation of any increase unless the Index rises by more than 10% for the Term. The 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy and the 6-year 10% Buffer with Upside Participation Rate Strategy do not have a Cap.
Footnote 30. The Upside Participation Rate is your share of any rise in the Index over a Term taken into account to determine the Strategy value at the end of the Term. In this example, the 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy has an Upside Participation Rate of 75% for the fourth Term, which means the calculation of any increase will include 75% of any Index rise for the Term. The 6-year 10% Buffer with Upside Participation Rate Strategy did not complete a Term in Year 4, so no Upside Participation Rate will be applied when determining the Strategy value at the end of Year 4. The 1-year 50% Downside Participation Rate with Cap Strategy does not have an Upside Participation Rate.
Footnote 31.
When the Index has risen over a Term, we use the following formulas to calculate the increase for the 1-year Strategy with a Cap.
Formula | If the rise in Index is less than Cap, then rise in Index = increase percentage based on rise in Index | |
Calculation | 4.00% rise in Index < 10% cap, so increase percentage = 4.00% |
When the Index has risen over a Term, we use the following formulas to calculate the increase for the 1-year Strategy with an Upside Participation Rate.
Formula | Rise in Index for Term x Upside Participation Rate for Term = Increase as a Percentage | |
Calculation | 4.00% x 75% = 3.00% |
For the S&P 500 6-year Buffer with an Upside Participation Rate Strategy, the Upside Participation Rate only applies at the end of the 6-year Term. At the end of Year 1, the Strategy Value is determined based on the Daily Value Percentage. The Daily Value Percentage may be more or less than the cumulative rise or fall of the Index since the Term start date, and it may be negative even when the Index has risen. In our example, the Daily Value Percentage at the end of Year 4 is 19.10%.
90
Footnote 32.
For a 1-year Strategy, when the Index has risen over the Term, we use the following formula to calculate the increase.
Formula | Remaining Investment Base x increase percentage based on rise in Index = dollar amount of increase based on rise in Index | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$54,575 x 4.00% = $2,183 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: | $53,016 x 3.00% = $1,590 |
For the 6-year Strategy, when the Daily Value Percentage is positive, we use the following formula to calculate the amount of the increase.
Formula | Remaining Investment Base x Daily Value Percentage = dollar amount of increase based on Daily Value Percentage | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,517 x 19.10% = $9,267 |
Footnote 33. In this example, for the 1-year Strategies, there has been a rise in the Index over the fourth Term. We use the following formula to calculate the Strategy value at the end of Year 4.
Formula | Remaining Investment Base on Term end date + dollar amount of increase based on rise in Index = Strategy value on Term end date | |
Calculation |
1-year 50% Downside Participation Rate with Cap 50% Downside Participation Rate with Cap Strategy: |
$54,575 + $2,183 = $56,758 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: | $53,016 + $1,590 = $54,606 |
For the 6-year Strategy, the Daily Value Percentage is positive at the end of Year 4. We use the following formula to calculate the Strategy value.
Formula | Remaining Investment Base on valuation date + dollar amount of increase based on Daily Value Percentage = current Strategy value | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,517 + $9,267 = $57,784 |
For the 1-year Strategies, the Strategy value at the end of the fourth Term is also the Investment Base at the beginning of the fifth Term. For the 6-year Strategy, the existing Investment Base is carried forward because it is not the end of a Term.
Footnote 34. When no withdrawals are taken over the course of a 1-year Term, the Daily Charges through the Term are equal to the Investment Base on the Term start date times the annual rate at which the Daily Charge compounds. When no withdrawals are taken over the course of a year that is part of a 6-year Term, the Daily Charges for the year are equal to the Investment Base at the Term start date or the most recent Term start date anniversary times the annual rate at which the Daily Charge compounds.
Formula | Investment Base on Term start date or anniversary x annual rate | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$56,758 x 0.75% = $426 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: | $54,606 x 0.75% = $410 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,517 x 0.75% = $364 |
Footnote 35. The remaining Investment Base is equal to the beginning Investment Base minus the sum of the Daily Charges and minus the proportional reduction for any prior withdrawals and related Early Withdrawal Charges.
91
Formula | Beginning Investment Base sum of Daily Charges since beginning of year proportional reduction for any prior Withdrawals and related Early Withdrawal Charges = remaining Investment Base | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy with a Cap: |
$56,758 - $426 - $0 = $56,332 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: | $54,606 - $410 - $0 = $54,196 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,517 - $364 - $0 = $48,153 |
Footnote 36. For a 1-year Strategy, the value at the end of the fifth Term is based on the rise or fall in the index over the Term. The rise or fall in Index for the Term is equal to the percentage change in the Index Value measured from the Term start date to the Term end date.
Formula | (Index Value on Term end date - Index Value on Term start date) / Index Value on Term start date | |
Calculation | (1216.65 1169.86) / 1169.86 = 4.00% |
For the 6-year Strategy, the value at the end of Year 5 is based on the Daily Value Percentage, and not the rise or fall in the Index.
Footnote 37. The Cap is the largest rise in the Index over a Term taken into account to determine any increase at the end of the Term. In this example, the 1-year 50% Downside Participation Rate with Cap Strategy has a Cap of 10% for the fifth Term, which means it will not affect the calculation of any increase unless the Index rises by more than 10% for the Term. The 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy and the 6-year 10% Buffer with Upside Participation Rate Strategy do not have a Cap.
Footnote 38. The Upside Participation Rate is your share of any rise in the Index over a Term taken into account to determine the Strategy value at the end of the Term. In this example, the 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy has an Upside Participation Rate of 75% for the fifth Term, which means the calculation of any increase will include 75% of any Index rise for the Term. The 6-year 10% Buffe with Upside Participation Rate Strategy did not complete a Term in Year 5, so no Upside Participation Rate will be applied when determining the Strategy value at the end of Year 5. The 1-year 50% Downside Participation Rate with Cap Strategy does not have an Upside Participation Rate.
Footnote 39.
When the Index has risen over a Term, we use the following formulas to calculate the increase for the 1-year Strategy with a Cap.
Formula | If the rise in Index is less than Cap, then rise in Index = increase percentage based on rise in Index | |
Calculation | 4.0% rise in Index < 10% cap, so increase percentage = 4.0% |
When the Index has risen over a Term, we use the following formulas to calculate the increase for the 1-year Strategy with an Upside Participation Rate.
Formula | Rise in Index for Term x Upside Participation Rate for Term = Increase as a Percentage | |
Calculation | 4.00% x 75% = 3.00% |
For the 6-year Strategy with an Upside Participation Rate, the Upside Participation Rate only applies at the end of the 6-year Term. At the end of Year 1, the Strategy Value is determined based on the Daily Value Percentage. The Daily Value Percentage may be more or less than the cumulative rise or fall of the Index since the Term start date, and it may be negative even when the Index has risen. In our example, the Daily Value Percentage at the end of Year 5 is 26.70%.
Footnote 40.
For a 1-year Strategy, when the Index has risen over the Term, we use the following formula to calculate the increase.
Formula | Remaining Investment Base x increase percentage based on rise in Index = dollar amount of increase based on rise in Index | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$56,332 x 4.00% = $2,253 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$54,196 x 3.00% = $1,626 |
For the 6-year Strategy, when the Daily Value Percentage is positive, we use the following formula to calculate the amount of the increase.
Formula | Remaining Investment Base x Daily Value Percentage = dollar amount of increase based on Daily Value Percentage | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,153 x 26.70% = $12,857 |
92
Footnote 41. In this example, for the 1-year Strategies, there has been a rise in the Index over the fifth Term. We use the following formula to calculate the Strategy value at the end of Year 5.
Formula | Remaining Investment Base on Term end date + dollar amount of increase based on rise in Index = Strategy value on Term end date | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$56,332 + $2,253 = $58,585 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$54,196 + $1,626 = $55,822 |
For the 6-year Strategy, the Daily Value Percentage is positive at the end of Year 5. We use the following formula to calculate the Strategy value.
Formula | Remaining Investment Base on valuation date + dollar amount of increase based on Daily Value Percentage = current Strategy value | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,153 + $12,857 = $61,010 |
For the 1-year Strategies, the Strategy value at the end of the fifth Term is also the Investment Base at the beginning of the sixth Term. For the 6-year Strategy, the existing Investment Base is carried forward because it is not the end of a Term.
Footnote 42. When no withdrawals are taken over the course of a 1-year Term, the Daily Charges through the Term are equal to the Investment Base on the Term start date times the annual rate at which the Daily Charge compounds. When no withdrawals are taken over the course of a year that is part of a 6-year Term, the Daily Charges for the year are equal to the Investment Base at the Term start date or the most recent Term start date anniversary times the annual rate at which the Daily Charge compounds.
Formula | Investment Base on Term start date or anniversary x annual rate | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$58,585 x 0.75% = $439 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$55,822 x 0.75% = $419 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,153 x 0.75% = $361 |
Footnote 43. The remaining Investment Base is equal to the beginning Investment Base minus the sum of the Daily Charges and minus the proportional reduction for any prior withdrawals and related Early Withdrawal Charges.
Formula | Beginning Investment Base sum of Daily Charges since beginning of year proportional reduction for any prior Withdrawals and related Early Withdrawal Charges = remaining Investment Base | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$58,585 - $439 - $0 = $58,146 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$55,822 - $419 - $0 = $55,403 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,153 - $361 - $0 = $47,792 |
Footnote 44. For a 1-year Strategy, the value at the end of the sixth Term is based on the rise or fall in the index over the Term. The rise or fall in Index for the Term is equal to the percentage change in the Index Value measured from the Term start date to the Term end date.
Formula |
(Index Value on Term end date - Index Value on Term start date) / Index Value on Term start date | |
Calculation | (1265.32 1216.65) / 1216.65 = 4.00% |
For the 6-year Strategy, the value at the end of the Term is based on the rise or fall in the index over the entire 6-year Term. The rise or fall in the Index for the Term is equal to the percentage change in the Index Value measured from the Term start date to the Term end date.
Formula | (Index Value on Term end date - Index Value on Term start date) / Index Value on Term start date | |
Calculation | (1265.32 1000.00) / 1000.00 = 26.53% |
93
Footnote 45. The Cap is the largest rise in the Index over a Term taken into account to determine any increase at the end of the Term. In this example, the 1-year 50% Downside Participation Rate with Cap Strategy has a Cap of 10% for the sixth Term, which means it will not affect the calculation of any increase unless the Index rises by more than 10% for the Term. The 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy and the 6-year 10% Buffer with Upside Participation Rate Strategy do not have a Cap.
Footnote 46. The Upside Participation Rate is your share of any rise in the Index over a Term taken into account to determine the Strategy value at the end of the Term. In this example, the 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy has an Upside Participation Rate of 75% for the sixth Term, which means the calculation of any increase will include 75% of any Index rise for the Term. The 6-year 10% Buffer with Upside Participation Rate Strategy has an Upside Participation Rate of 130% for the 6-year Term, which means the calculation of any increase will include 130% of any Index rise for the term. The 1-year 50% Downside Participation Rate with Cap Strategy does not have an Upside Participation Rate.
Footnote 47.
When the Index has risen over a Term, we use the following formulas to calculate the increase for the 1-year Strategy with a Cap.
Formula | If the rise in Index is less than Cap, then rise in Index = increase percentage based on rise in Index | |
Calculation | 4.00% rise in Index < 10% cap, so increase percentage = 4.00% |
When the Index has risen over a Term, we use the following formulas to calculate the increase for the 1-year Strategy with an Upside Participation Rate.
Formula | Rise in Index for Term x Upside Participation Rate for Term = Increase as a Percentage | |
Calculation | 4.00% x 75% = 3.00% |
When the Index has risen over a Term, we use the following formulas to calculate the increase for the 6-year Strategy with an Upside Participation Rate.
Formula | Rise in Index for Term x Upside Participation Rate for Term = Increase as a Percentage | |
Calculation | 26.53% x 130% = 34.49% |
Footnote 48.
When the Index has risen over the Term, we use the following formula to calculate the increase.
Formula | Remaining Investment Base x increase percentage based on rise in Index = dollar amount of increase based on rise in Index | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$58,146 x 4.0% = $2,326 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$55,403 x 3.00% = $1,662 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$47,792 x 34.49% = $16,483 |
Footnote 49. In this example, for the 1-year Strategies, there has been a rise in the Index over the sixth Term. For the 6-year Strategy, there has also been a rise in the index over its 6-year Term. This means that both for a 1-year Strategy and the 6-year Strategy, the Strategy value at the end of Year 6 is the Remaining Investment Base on the Term end date plus the increase for the rise in the Index over the Term.
Formula | Remaining Investment Base on Term end date + dollar amount of increase based on rise in Index = Strategy value on Term end date | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$58,146 + $2,326 = $60,472 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$55,403 + $1,662 = $57,065 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$47,792 + $16,483 = $64,275 |
94
Example G: Amount Available for a Withdrawal After 6 Years When Index Falls Steadily
The following example is intended to help you understand the amount that may be available for withdrawal for Indexed Strategies that have different Term lengths after a six-year period when the Index falls at a steady rate.
This example assumes:
| you allocate a $50,000 Purchase Payment to the S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy when the S&P 500 is 1000.00; |
| you allocate a $50,000 Purchase Payment to the S&P 500 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy when the S&P 500 is 1000.00; |
| you allocate a $50,000 Purchase Payment to the S&P 500 6-Year 10% Buffer with Upside Participation Rate Strategy when the S&P 500 is 1000.00; |
| the Contract Effective Date and the Term start date are both April 6, 2024, so that the Contract Years and Term Years align; |
| you do not take any withdrawals during the first six Contract Years; |
| amounts allocated to the 1-year strategies are rolled over into the same Indexed Strategy at the end of each 1-year Term; and |
| on April 6, 2025, the S&P 500 is at 960.00 and the 6-year Strategy Daily Value Percentage is -4.50%; on April 6, 2026, the S&P 500 is at 921.60 and the 6-year Strategy Daily Value Percentage is -4.90%; on April 6, 2027, the S&P 500 is at 884.74 and the 6-year Strategy Daily Value Percentage is -6.00%; on April 6, 2028, the S&P 500 is at 849.35 and the 6-year Strategy Daily Value Percentage is -8.10%; on April 6, 2029, the S&P 500 is at 815.37 and the 6-year Strategy Daily Value Percentage is -10.00%; and on April 6, 2030, the S&P 500 is at 782.76; and |
| you have not made a Performance Lock election. |
S&P 500 1-year 50% Downside Participation Rate with Cap Strategy |
S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy |
S&P 500 6-year 10% Buffer with Upside Participation Rate Strategy |
||||||||||||
Year 1 |
||||||||||||||
Strategy Value - April 6, 2024 |
$ | 50,000 | $ | 50,000 | $ | 50,000 | See Footnote 1 below. | |||||||
Investment Base - April 6, 2024 |
$ | 50,000 | $ | 50,000 | $ | 50,000 | See Footnote 1 below. | |||||||
Daily Charges for Period |
$ | 375 | $ | 375 | $ | 375 | See Footnote 2 below. | |||||||
Remaining Investment Base - April 6, 2025 |
$ | 49,625 | $ | 49,625 | $ | 49,625 | See Footnote 3 below. | |||||||
Fall in Index for Period |
4.00 | % | 4.00 | % | n/a | See Footnote 4 below. | ||||||||
Buffer for Period |
n/a | n/a | n/a | See Footnote 5 below. | ||||||||||
Downside Participation Rate For Period |
50 | % | 50 | % | n/a | See Footnote 6 below. | ||||||||
Decrease as a Percentage |
2.00 | % | 2.00 | % | 4.50 | % | See Footnote 7 below. | |||||||
Dollar Amount of Decrease |
$ | 993 | $ | 993 | $ | 2,233 | See Footnote 8 below. | |||||||
Strategy Value - April 6, 2025 |
$ | 48,632 | $ | 48,632 | $ | 47,392 | See Footnote 9 below. | |||||||
Year 2 |
||||||||||||||
Investment Base - April 6, 2025 |
$ | 48,632 | $ | 48,632 | $ | 49,625 | See Footnote 9 below. | |||||||
Daily Charges for Period |
$ | 365 | $ | 365 | $ | 372 | See Footnote 10 below. | |||||||
Remaining Investment Base - April 6, 2026 |
$ | 48,267 | $ | 48,267 | $ | 49,253 | See Footnote 11 below. | |||||||
Fall in Index for Period |
4.00 | % | 4.00 | % | n/a | See Footnote 12 below. | ||||||||
Buffer for Period |
n/a | n/a | n/a | See Footnote 13 below. | ||||||||||
Downside Participation Rate For Period |
50 | % | 50 | % | n/a | See Footnote 14 below. | ||||||||
Decrease as a Percentage |
2.00 | % | 2.00 | % | 4.90 | % | See Footnote 15 below. | |||||||
Dollar Amount of Decrease |
$ | 965 | $ | 965 | $ | 2,413 | See Footnote 16 below. | |||||||
Strategy Value April 6, 2026 |
$ | 47,302 | $ | 47,302 | $ | 46,840 | See Footnote 17 below. | |||||||
Year 3 |
||||||||||||||
Investment Base April 6, 2026 |
$ | 47,302 | $ | 47,302 | $ | 49,253 | See Footnote 17 below. | |||||||
Daily Charges for Period |
$ | 355 | $ | 355 | $ | 369 | See Footnote 18 below. | |||||||
Remaining Investment Base April 6, 2027 |
$ | 46,947 | $ | 46,947 | $ | 48,884 | See Footnote 19 below. | |||||||
Fall in Index for Period |
4.00 | % | 4.00 | % | n/a | See Footnote 20 below. | ||||||||
Buffer for Period |
n/a | n/a | n/a | See Footnote 21 below. | ||||||||||
Downside Participation Rate For Period |
50 | % | 50 | % | n/a | See Footnote 22 below. | ||||||||
Decrease as a Percentage |
2.00 | % | -2.00 | % | 6.00 | % | See Footnote 23 below. | |||||||
Dollar Amount of Decrease |
$ | 939 | $ | 939 | $ | 2,933 | See Footnote 24 below. | |||||||
Strategy Value - April 6, 2027 |
$ | 46,008 | $ | 46,008 | $ | 45,951 | See Footnote 25 below. |
95
Year 4 |
||||||||||||||||
Investment Base - April 6, 2027 |
$ | 46,008 | $ | 46,008 | $ | 48,884 | See Footnote 25 below. | |||||||||
Daily Charges for Period |
$ | 345 | $ | 345 | $ | 367 | See Footnote 26 below. | |||||||||
Remaining Investment Base - April 6, 2028 |
$ | 45,663 | $ | 45,663 | $ | 48,517 | See Footnote 27 below. | |||||||||
Fall in Index for Period |
4.00 | % | 4.00 | % | n/a | See Footnote 28 below. | ||||||||||
Buffer for Period |
n/a | n/a | n/a | See Footnote 29 below. | ||||||||||||
Downside Participation Rate For Period |
50 | % | 50 | % | n/a | See Footnote 30 below. | ||||||||||
Decrease as a Percentage |
2.00 | % | 2.00 | % | 8.10 | % | See Footnote 31 below. | |||||||||
Dollar Amount of Decrease |
$ | 913 | $ | 913 | $ | 3,930 | See Footnote 32 below. | |||||||||
Strategy Value - April 6, 2028 |
$ | 44,750 | $ | 44,750 | $ | 44,587 | See Footnote 33 below. | |||||||||
Year 5 |
||||||||||||||||
Investment Base - April 6, 2028 |
$ | 44,750 | $ | 44,750 | $ | 48,517 | See Footnote 33 below. | |||||||||
Daily Charges for Period |
$ | 336 | $ | 336 | $ | 364 | See Footnote 34 below. | |||||||||
Remaining Investment Base - April 6, 2029 |
$ | 44,414 | $ | 44,414 | $ | 48,153 | See Footnote 35 below. | |||||||||
Fall in Index for Period |
4.00 | % | 4.00 | % | n/a | See Footnote 36 below. | ||||||||||
Buffer for Period |
n/a | n/a | n/a | See Footnote 37 below. | ||||||||||||
Downside Participation Rate For Period |
50 | % | 50 | % | n/a | See Footnote 38 below. | ||||||||||
Decrease as a Percentage |
2.00 | % | 2.00 | % | -0.00 | % | See Footnote 39 below. | |||||||||
Dollar Amount of Decrease |
$ | 888 | $ | 888 | 4,815 | See Footnote 40 below. | ||||||||||
Strategy Value - April 6, 2029 |
$ | 43,526 | $ | 43,526 | $ | 43,338 | See Footnote 41 below. | |||||||||
Year 6 |
||||||||||||||||
Investment Base - April 6, 2029 |
$ | 43,526 | $ | 43,526 | $ | 48,153 | See Footnote 41 below. | |||||||||
Daily Charges for Period |
$ | 326 | $ | 326 | $ | 361 | See Footnote 42 below. | |||||||||
Remaining Investment Base - April 6, 2030 |
$ | 43,200 | $ | 43,200 | $ | 47,792 | See Footnote 43 below. | |||||||||
Fall in Index for Period |
4.00 | % | 4.00 | % | 21.72 | % | See Footnote 44 below. | |||||||||
Buffer for Period |
n/a | n/a | 10 | % | See Footnote 45 below. | |||||||||||
Downside Participation Rate For Period |
50 | % | 50 | % | n/a | See Footnote 46 below. | ||||||||||
Decrease as a Percentage |
2.00 | % | 2.00 | % | 11.72 | % | See Footnote 47 below. | |||||||||
Dollar Amount of Decrease |
$ | 864 | $ | 864 | $ | 5,601 | See Footnote 48 below. | |||||||||
Strategy Value - April 6, 2030 |
$ | 42,336 | $ | 42,336 | $ | 42,191 | See Footnote 49 below. |
Footnote 1. At the beginning of the first Term, the Strategy value is equal to the amount applied to the Strategy on the Term start date. The amount applied on the Term start date is also the beginning Investment Base.
Footnote 2. When no withdrawals are taken over the course of a 1-year Term, the Daily Charges through the Term are equal to the Investment Base at the Term start date times the annual rate at which the Daily Charge compounds. When no withdrawals are taken over the course of a year that is part of a 6-year Term, the Daily Charges for the year are equal to the Investment Base at the Term start date or the most recent Term start date anniversary times the annual rate at which the Daily Charge compounds.
Formula | Investment Base at Term start date or anniversary x annual rate | |
Calculation | $50,000 x 0.75% = $375 for all Indexed Strategies |
Footnote 3. The remaining Investment Base is equal to the beginning Investment Base minus the sum of the Daily Charges and minus the proportional reduction for any prior withdrawals and related Early Withdrawal Charges.
Formula | Beginning Investment Base sum of Daily Charges since beginning of year proportional reduction for any prior Withdrawals and related Early Withdrawal Charges = remaining Investment Base | |
Calculation | $50,000 - $375 - $0 = $49,625 for all Indexed Strategies |
Footnote 4. For a 1-year Strategy, the value at the end of the first Term is based on the rise or fall in the index over the Term. The rise or fall in Index for the Term is equal to the percentage change in the Index Value measured from the Term start date to the Term end date.
Formula | (Index Value on Term end date - Index Value on Term start date) / Index Value on Term start date | |
Calculation | (960.00 1000.00) / 1000.00 = -4.00% |
Thus, the Index has fallen 4.00%.
For the 6-year Strategy, the value at the end of Year 1 is based on the Daily Value Percentage, and not the rise or fall in the Index.
96
Footnote 5. The Buffer is the decrease in the value of an Index for a Term that is disregarded when determining the Loss for the Term. In this example, the S&P 500 6-year 10% Buffer with Upside Participation Rate Strategy did not complete a Term in Year 1, so no Buffer will be applied when determining the Strategy value at the end of Year 1. The 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy and the 1-year 50% Downside Participation Rate with Cap Strategy do not have a Buffer.
Footnote 6. The Downside Participation Rate is your share of any fall in the Index over a Term taken into account to determine the Strategy value at the end of the Term. In this example, both the 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy and the 1-year 50% Downside Participation Rate with Cap Strategy each have a Downside Participation Rate of 50%, which means the calculation of any decrease will include 50% of any Index fall. The 6-year 10% Buffer with Upside Participation Rate Strategy does not have a Downside Participation Rate.
Footnote 7.
The Index has fallen 4% in Year 1.
For a 1-year Strategy, when the Index has fallen over a Term, we use the following formula to calculate the decrease for both the 1-year 50% Downside Participation Rate with Cap Strategy and the 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy .
Formula | Fall in Index for Term x Downside Participation Rate for Term = Decrease as a Percentage | |
Calculation | 4.00% x 50% = 2.0% |
For the 6-year 10% Buffer with Upside Participation Rate Strategy, the Buffer only applies at the end of the 6-year Term. At the end of Year 1, the Strategy value is determined based on the Daily Value Percentage. The Daily Value Percentage may be more or less than the cumulative rise or fall of the Index since the Term start date, and it may be negative even when the Index has risen. The Strategy value may decline even when the fall in the Index has not exceeded the Buffer.
Footnote 8.
The Index has fallen 4% in Year 1
For a 1-year Strategy, when the Index has fallen over the Term, we use the following formula to calculate the amount of the decrease.
Formula | Remaining Investment Base x decrease percentage based on fall in Index = dollar amount of decrease based on fall in Index | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$49,625 x 2.0% = $993 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$49,625 x 2.0% = $993 |
Year 1 does not mark the end of a Term for the S&P 500 6-year 10% Buffer with Upside Participation Rate Strategy, so the value for that Strategy at the end of Year 1 is calculated using the same formula used on any other day before the end of a Term:
For the 6-year Strategy, when the Daily Value Percentage is negative, we use the following formula to calculate the amount of the decrease.
Formula | Remaining Investment Base x Daily Value Percentage = dollar amount of change based on Daily Value Percentage | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy : |
$49,625 x -4.50% = -$2,233 |
Thus, the dollar amount of decrease is $2,233.
Footnote 9. In this example, for the 1-year Strategies, there has been a fall in the Index over the first Term. We use the following formula to calculate the Strategy value at the end of Year 1.
Formula | Remaining Investment Base on Term end date - dollar amount of decrease based on fall in Index = Strategy value on Term end date | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$49,625 - $993 = $48,632 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$49,625 - $993 = $48,632 |
For the 6-year Strategy, the Daily Value Percentage is negative at the end of Year 1. We use the following formula to calculate the Strategy value.
Formula | Remaining Investment Base on valuation date - dollar amount of decrease based on Daily Value Percentage = current Strategy value | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$49,625 - $2,333 = $47,392 |
97
For the 1-year Strategies, the Strategy value at the end of the first Term is also the Investment Base at the beginning of the second Term. For the 6-year Strategy, the existing Investment Base is carried forward because it is not the end of a Term.
Footnote 10. When no withdrawals are taken over the course of a 1-year Term, the Daily Charges through the Term are equal to the Investment Base on the Term start date times the annual rate at which the Daily Charge compounds. When no withdrawals are taken over the course of a year that is part of a 6-year Term, the Daily Charges for the year are equal to the Investment Base at the Term start date or the most recent Term start date anniversary times the annual rate at which the Daily Charge compounds.
Formula | Investment Base on Term start date or anniversary x annual rate | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$48,632 x 0.75% = $365 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$48,632 x 0.75% = $365 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$49,625 x 0.75% = $372 |
Footnote 11. The remaining Investment Base is equal to the beginning Investment Base minus the sum of the Daily Charges and minus the proportional reduction for any prior withdrawals and related Early Withdrawal Charges.
Formula | Beginning Investment Base sum of Daily Charges since beginning of year proportional reduction for any prior Withdrawals and related Early Withdrawal Charges = remaining Investment Base | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$48,632 - $365 - $0 = $48,267 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$48,632 - $365 - $0 = $48,267 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$49,625 - $372 - $0 = $49,253 |
Footnote 12. For a 1-year Strategy, the value at the end of the second Term is based on the rise or fall in the index over the Term. The rise or fall in Index for the Term is equal to the percentage change in the Index Value measured from the Term start date to the Term end date.
Formula | (Index Value on Term end date - Index Value on Term start date) / Index Value on Term start date | |
Calculation | (921.60 960.00) / 960.00 = 4.0% |
Thus, the Index has fallen 4.00%.
For the 6-year Strategy, the value at the end of Year 2 is based on the Daily Value Percentage, and not the rise or fall in the Index.
Footnote 13. The Buffer is the decrease in the value of an Index for a Term that is disregarded when determining the Loss for the Term. In this example, the S&P 500 6-year10% Buffer with Upside Participation Rate did not complete a Term in Year 2, so no Buffer will be applied to that Strategy in Year 2. The 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy and the 1-year 50% Downside Participation Rate with Cap Strategy do not have a Buffer.
Footnote 14. The Downside Participation Rate is your share of any fall in the Index over a Term taken into account to determine the Strategy value at the end of the Term. In this example, the 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy and the 1-year 50% Downside Participation Rate with Cap Strategy each have a Downside Participation Rate of 50%, which means the calculation of any decrease will include 50% of any Index fall. The 6-10% Buffer with Upside Participation Rate year Strategy does not have a Downside Participation Rate.
Footnote 15.
The Index has fallen 4% in Year 2.
When the Index has fallen over a Term, we use the following formula to calculate the decrease for both the 1-year 50% Downside Participation Rate with Cap Strategy and the 1-Year 50% Downside Participation Rate with an Upside Participation Rate Strategy.
Formula | Fall in Index for Term x Downside Participation Rate for Term = Decrease as a Percentage | |
Calculation | 4.00% x 50% = 2.00% |
98
For the 6-year 10% Buffer with Upside Participation Rate Strategy, the Buffer only applies at the end of the 6-year Term. At the end of Year 2, the Strategy value is determined based on the Daily Value Percentage. The Daily Value Percentage may be more or less than the cumulative rise or fall of the Index since the Term start date, and it may be negative even when the Index has risen. The Strategy value may decline even when the fall in the Index has not exceeded the Buffer.
Footnote 16.
The Index has fallen 4% in Year 2
For a 1-year Strategy, when the Index has fallen over the Term, we use the following formula to calculate the amount of the decrease.
Formula | Remaining Investment Base x decrease percentage based on fall in Index = dollar amount of decrease based on fall in Index | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$48,267 x 2.00% = $965 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$48,267 x 2.0% = $965 |
Year 2 does not mark the end of a Term for the S&P 500 6-year 10% Buffer with Upside Participation Rate Strategy, so the value for that Strategy at the end of Year 2 is calculated using the same formula used on any other day before the end of a Term:
Formula | Remaining Investment Base x Daily Value Percentage = dollar amount of decrease based on Daily Value Percentage | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$49,253 x -4.90% = -$2,413 |
Thus, the dollar amount of decrease is $2,413.
Footnote 17. In this example, for the 1-year Strategies, there has been a fall in the Index over the second Term. We use the following formula to calculate the Strategy value at the end of Year 2.
Formula | Remaining Investment Base on Term end date - dollar amount of decrease based on fall in Index = Strategy value on Term end date | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$48,267 - $965 = $47,302 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$48,267 - $965 = $47,302 |
For the 6-year Strategy, the Daily Value Percentage is negative at the end of Year 2. We use the following formula to calculate the Strategy value.
Formula | Remaining Investment Base on valuation date - dollar amount of decrease based on Daily Value Percentage = current Strategy value | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$49,253 - $2,413 = $46,840 |
For the 1-year Strategies, the Strategy value at the end of the second Term is also the Investment Base at the beginning of the third Term. For the 6-year Strategy, the existing Investment Base is carried forward because it is not the end of a Term.
Footnote 18. When no withdrawals are taken over the course of a 1-year Term, the Daily Charges through the Term are equal to the Investment Base on the Term start date times the annual rate at which the Daily Charge compounds. When no withdrawals are taken over the course of a year that is part of a 6-year Term, the Daily Charges for the year are equal to the Investment Base at the Term start date or the most recent Term start date anniversary times the annual rate at which the Daily Charge compounds.
99
Formula | Investment Base on Term start date or anniversary x annual rate | |
Calculation |
1-year Strategy with a Cap: |
$47,302 x 0.75% = $355 | |
1-year Strategy with an Upside Participation Rate: |
$47,302 x 0.75% = $355 | |
6-year Strategy with a Buffer: |
$49,253 x 0.75% = $369 |
Footnote 19. The remaining Investment Base is equal to the beginning Investment Base minus the sum of the Daily Charges and minus the proportional reduction for any prior withdrawals and related Early Withdrawal Charges.
Formula | Beginning Investment Base sum of Daily Charges since beginning of year proportional reduction for any prior Withdrawals and related Early Withdrawal Charges = remaining Investment Base | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$47,302 - $355 - $0 = $46,947 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy : |
$47,302 - $355 - $0 = $46,947 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$49,253 - $369 - $0 = $48,884 |
Footnote 20. For a 1-year Strategy, the value at the end of the third Term is based on the rise or fall in the index over the Term. The rise or fall in Index for the Term is equal to the percentage change in the Index Value measured from the Term start date to the Term end date.
Formula | (Index Value on Term end date - Index Value on Term start date) / Index Value on Term start date | |
Calculation | (884.74- 921.60) / 921.60 = -4.0% |
Thus, the Index has fallen 4.00%.
For the 6-year Strategy, the value at the end of Year 3 is based on the Daily Value Percentage, and not the rise or fall in the Index.
Footnote 21. The Buffer is the decrease in the value of an Index for a Term that is disregarded when determining the Loss for the Term. In this example, the S&P 500 6-year10% Buffer with Upside Participation Rate Strategy did not complete a Term in Year 3, so no Buffer will be applied to that Strategy in Year 3. The 1-year Upside Participation Rate Strategy and the 1-year Strategy with a Cap do not have a Buffer.
Footnote 22. The Downside Participation Rate is your share of any fall in the Index over a Term taken into account to determine the Strategy value at the end of the Term. In this example, the 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy and the 1-year 50% Downside Participation Rate with Cap Strategy each have a Downside Participation Rate of 50%, which means the calculation of any decrease will include 50% of any Index fall. The 6-year 10% Buffer with Upside Participation Rate Strategy does not have a Downside Participation Rate.
Footnote 23.
The Index has fallen 4% in Year 3.
For a 1-year Strategy, when the Index has fallen over a Term, we use the following formula to calculate the decrease for both the 1-year Strategy with a Cap and the 1-Year Strategy with an Upside Participation Rate.
Formula | Fall in Index for Term x Downside Participation Rate for Term = Decrease as a Percentage | |
Calculation | 4.00% x 50% = 2.00% |
For the 6-year 10% Buffer with Upside Participation Rate Strategy, the Buffer only applies at the end of the 6-year Term. At the end of Year 3, the Strategy value is determined based on the Daily Value Percentage. The Daily Value Percentage may be more or less than the cumulative rise or fall of the Index since the Term start date, and it may be negative even when the Index has risen. The Strategy value may decline even when the fall in the Index has not exceeded the Buffer.
Footnote 24.
The Index has fallen 4% in Year 3.
For a 1-year Strategy, when the Index has fallen over the Term, we use the following formula to calculate the amount of the decresae.
Formula | Remaining Investment Base x decrease percentage based on rise in Index = dollar amount of decrease based on fall in Index | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$46,947 x 2.00% = $939 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$46,947 x 2.00% = $939 |
100
Year 3 does not mark the end of a Term for the S&P 500 6-year 10% Buffer with Upside Participation Rate Strategy, so the value for that Strategy at the end of Year 3 is calculated using the same formula used on any other day before the end of a Term:
Formula | Remaining Investment Base x Daily Value Percentage = dollar amount of change based on Daily Value Percentage | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,884 x 6.00% = $2,933 |
Thus, the dollar amount of decrease is $2,933.
Footnote 25. In this example, for the 1-year Strategies, there has been a fall in the Index over the third Term. This means the Strategy value at the end of Year 3 is the Remaining Investment Base on the Term end date minus the decrease for the fall in the Index over the Term.
Formula | Remaining Investment Base on Term end date - dollar amount of decrease based on rise in Index = Strategy value on Term end date | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$46,947 - $939 = $46,008 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$46,947 - $939 = $46,008 |
For the 6-year Strategy, the Daily Value Percentage is negative at the end of Year 3. We use the following formula to calculate the Strategy value.
Formula | Remaining Investment Base on valuation date - dollar amount of decrease based on Daily Value Percentage = current Strategy value | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,884 - $2,933 = $45,951 |
For the 1-year Strategies, the Strategy value at the end of the third Term is also the Investment Base at the beginning of the fourth Term. For the 6-year Strategy, the existing Investment Base is carried forward because it is not the end of a Term.
Footnote 26. When no withdrawals are taken over the course of a 1-year Term, the Daily Charges through the Term are equal to the Investment Base on the Term start date times the annual rate at which the Daily Charge compounds. When no withdrawals are taken over the course of a year that is part of a 6-year Term, the Daily Charges for the year are equal to the Investment Base at the Term start date or the most recent Term start date anniversary times the annual rate at which the Daily Charge compounds.
Formula | Investment Base on Term start date or anniversary x annual rate | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$46,008 x 0.75% = $345 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$46,008 x 0.75% = $345 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,884 x 0.75% = $367 |
Footnote 27. The remaining Investment Base is equal to the beginning Investment Base minus the sum of the Daily Charges and minus the proportional reduction for any prior withdrawals and related Early Withdrawal Charges.
Formula | Beginning Investment Base sum of Daily Charges since beginning of year proportional reduction for any prior Withdrawals and related Early Withdrawal Charges = remaining Investment Base | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$46,008 - $345 - $0 = $45,663 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$46,008 - $345 - $0 = $45,663 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,884 - $367 - $0 = $48,517 |
101
Footnote 28. For a 1-year Strategy, the value at the end of the fourth Term is based on the rise or fall in the index over the Term. The rise or fall in Index for the Term is equal to the percentage change in the Index Value measured from the Term start date to the Term end date.
Formula | (Index Value on Term end date- Index Value on Term start date) / Index Value on Term start date | |
Calculation | (849.35 884.74) / 884.74 = -4.00% |
Thus, the Index has fallen 4.00%.
For the 6-year Strategy, the value at the end of Year 4 is based on the Daily Value Percentage, and not the rise or fall in the Index.
Footnote 29. The Buffer is the decrease in the value of an Index for a Term that is disregarded when determining the Loss for the Term. In this example, the S&P 500 6-year 10% Buffer with Upside Participation Rate Strategy did not complete a Term in Year 4, so no Buffer will be applied to that Strategy in Year 4. The 1-year 50% Downside Participation Rate with Upside Participation Rate
Strategy and the 1-year 50% Downside Participation Rate with Cap Strategy with a Cap do not have a Buffer.
Footnote 30. The Downside Participation Rate is your share of any fall in the Index over a Term taken into account to determine the Strategy value at the end of the Term. In this example, the 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy and the 1-year 50% Downside Participation Rate with Cap Strategy each have a Downside Participation Rate of 50%, which means the calculation of any decrease will include 50% of any Index fall. The 6-year 10% Buffer with Upside Participation Rate Strategy does not have a Downside Participation Rate.
Footnote 31.
The Index has fallen 4% in Year 4
For a 1-year Strategy, when the Index has fallen over a Term, we use the following formula to calculate the decrease for both the 1-year 50% Downside Participation Rate with Cap Strategy and the 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy .
Formula | Fall in Index for Term x Downside Participation Rate for Term = Decrease as a Percentage | |
Calculation | 4.0% x 50% = 2.0% |
For the 6-year 10% Buffer with Upside Participation Rate Strategy, the Buffer only applies at the end of the 6-year Term. At the end of Year 4, the Strategy value is determined based on the Daily Value Percentage. The Daily Value Percentage may be more or less than the cumulative rise or fall of the Index since the Term start date, and it may be negative even when the Index has risen. The Strategy value may decline even when the fall in the Index has not exceeded the Buffer.
Footnote 32.
The Index has fallen 4% in Year 4
For a 1-year Strategy, when the Index has fallen over the Term, we use the following formula to calculate the amount of the decrease.
Formula | Remaining Investment Base x decrease percentage based on fall in Index = dollar amount of decrease based on fall in Index | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$45,663 x 2.00% = $913 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$45,663 x 2.00% = $913 |
Year 4 does not mark the end of a Term for the S&P 500 6-year 10% Buffer with Upside Participation Rate Strategy, so the value for that Strategy at the end of Year 4 is calculated using the same formula used on any other day before the end of a Term:
Formula | Remaining Investment Base x Daily Value Percentage = dollar amount of change based on Daily Value Percentage | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,517 x -8.10% = -$3,930 |
Thus, the dollar amount of decrease is $3,930.
Footnote 33. In this example, for the 1-year Strategies, there has been a fall in the Index over the fourth Term. This means the Strategy value at the end of Year 4 is the Remaining Investment Base on the Term end date minus the decrease for the fall in the Index over the Term.
102
Formula | Remaining Investment Base on Term end date - dollar amount of decrease based on fall in Index = Strategy value on Term end date | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$45,663 - $913 = $44,750 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$45,663 - $913 = $44,750 |
For the 6-year 10% Buffer with Upside Participation Rate Strategy, the Daily Value Percentage is negative at the end of Year 4. We use the following formula to calculate the Strategy value.
Formula | Remaining Investment Base on valuation date - dollar amount of decrease based on Daily Value Percentage = current Strategy value | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,517 - $3,930 = $44,587 |
For the 1-year Strategies, the Strategy value at the end of the fourth Term is also the Investment Base at the beginning of the fifth Term. For the 6-year Strategy, the existing Investment Base is carried forward because it is not the end of a Term.
Footnote 34. When no withdrawals are taken over the course of a 1-year Term, the Daily Charges through the Term are equal to the Investment Base on the Term start date times the annual rate at which the Daily Charge compounds. When no withdrawals are taken over the course of a year that is part of a 6-year Term, the Daily Charges for the year are equal to the Investment Base at the Term start date or the most recent Term start date anniversary times the annual rate at which the Daily Charge compounds.
Formula | Investment Base on Term start date or anniversary x annual rate | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$44,750 x 0.75% = $336 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$44,750 x 0.75% = $336 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,517 x 0.75% = $364 |
Footnote 35. The remaining Investment Base is equal to the beginning Investment Base minus the sum of the Daily Charges and minus the proportional reduction for any prior withdrawals and related Early Withdrawal Charges.
Formula | Beginning Investment Base sum of Daily Charges since beginning of year proportional reduction for any prior Withdrawals and related Early Withdrawal Charges = remaining Investment Base | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$44,750 - $336 - $0 = $44,414 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$44,750 - $336 - $0 = $44,414 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,517 - $364 - $0 = $48,153 |
Footnote 36. For a 1-year Strategy, the value at the end of the fifth Term is based on the rise or fall in the index over the Term. The rise or fall in Index for the Term is equal to the percentage change in the Index Value measured from the Term start date to the Term end date.
Formula | (Index Value on Term end date - Index Value on Term start date) / Index Value on Term start date | |
Calculation | (815.37 849.35) / 849.35 = -4.00% |
Thus, the Index has fallen 4.00%.
For the 6-year 10% Buffer with Upside Participation Rate Strategy, the value at the end of Year 5 is based on the Daily Value Percentage, and not the rise or fall in the Index.
103
Footnote 37. The Buffer is the decrease in the value of an Index for a Term that is disregarded when determining the Loss for the Term. In this example, the S&P 500 6-year 10% Buffer with Upside Participation Rate Term 10% Buffer did not complete a Term in Year 5, so no Buffer will be applied to that Strategy in Year 5. The 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy and the 1-year 50% Downside Participation Rate with Cap Strategy with a Cap do not have a Buffer.
Footnote 38. The Downside Participation Rate is your share of any fall in the Index over a Term taken into account to determine the Strategy value at the end of the Term. In this example, the 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy and the 1-year 50% Downside Participation Rate with Cap Strategy each have a Downside Participation Rate of 50%, which means the calculation of any decrease will include 50% of any Index fall. The 6-year 10% Buffer with Upside Participation Rate Strategy does not have a Downside Participation Rate.
Footnote 39.
The Index has fallen 4% in Year 5
For a 1-year Strategy, when the Index has fallen over a Term, we use the following formula to calculate the decrease for both the 1-year Strategy with a Cap and the 1-Year Strategy with an Upside Participation Rate.
Formula | Fall in Index for Term x Downside Participation Rate for Term = Decrease as a Percentage | |
Calculation | 4.00% x 50% = 2.00% |
For the 6-year 10% Buffer with Upside Participation Rate Strategy with a Buffer, the Buffer only applies at the end of the 6-year Term. At the end of Year 5, the Strategy value is determined based on the Daily Value Percentage. The Daily Value Percentage may be more or less than the cumulative rise or fall of the Index since the Term start date, and it may be negative even when the Index has risen. The Strategy value may decline even when the fall in the Index has not exceeded the Buffer.
Footnote 40.
The Index has fallen 4% in Year 5
For a 1-year Strategy, when the Index has fallen over the Term, we use the following formula to calculate the amount of the decrease.
Formula | Remaining Investment Base x decrease percentage based on fall in Index = dollar amount of decrease based on rise in Index | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$44,414 x 2.00% = $888 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$44,414 x 2.00% = $888 |
Year 5 does not mark the end of a Term for the S&P 500 6-year 10% Buffer with Upside Participation Rate Strategy, so the value for that Strategy at the end of Year 5 is calculated using the same formula used on any other day before the end of a Term:
Formula | Remaining Investment Base x Daily Value Percentage = dollar amount of change based on Daily Value Percentage | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,153 x -10.00% = -$4,815 |
Thus, the dollar amount of decrease is $4,815.
Footnote 41. In this example, for the 1-year Strategies, there has been a fall in the Index over the fifth Term. This means the Strategy value at the end of Year 5 is the Remaining Investment Base on the Term end date minus the decrease for the fall in the Index over the Term.
Formula | Remaining Investment Base on Term end date + dollar amount of decrease based on fall in Index = Strategy value on Term end date | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$44,414 - $888 = $43,526 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$44,414 - $888 = $43,526 |
For the 6-year 10% Buffer with Upside Participation Rate Strategy, the Daily Value Percentage is negative at the end of Year 5. We use the following formula to calculate the Strategy value.
Formula | Remaining Investment Base on valuation date - dollar amount of decrease based on Daily Value Percentage = current Strategy value | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,153 - $4,815 = $43,338 |
104
For the 1-year Strategies, the Strategy value at the end of the fifth Term is also the Investment Base at the beginning of the sixth Term. For the 6-year Strategy, the existing Investment Base is carried forward because it is not the end of a Term.
Footnote 42. When no withdrawals are taken over the course of a 1-year Term, the Daily Charges through the Term are equal to the Investment Base on the Term start date times the annual rate at which the Daily Charge compounds. When no withdrawals are taken over the course of a year that is part of a 6-year Term, the Daily Charges for the year are equal to the Investment Base at the Term start date or the most recent Term start date anniversary times the annual rate at which the Daily Charge compounds.
Formula | Investment Base on Term start date or anniversary x annual rate | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$43,526 x 0.75% = $326 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$43,526 x 0.75% = $326 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,153 x 0.75% = $361 |
Footnote 43. The remaining Investment Base is equal to the beginning Investment Base minus the sum of the Daily Charges and minus the proportional reduction for any prior withdrawals and related Early Withdrawal Charges.
Formula | Beginning Investment Base sum of Daily Charges since beginning of year proportional reduction for any prior Withdrawals and related Early Withdrawal Charges = remaining Investment Base | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$43,526 - $326 - $0 = $43,200 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$43,526 - $326 - $0 = $43,200 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,153 - $361 - $0 = $47,792 |
Footnote 44. For a 1-year Strategy, the value at the end of the sixth Term is based on the rise or fall in the index over the Term. The rise or fall in Index for the Term is equal to the percentage change in the Index Value measured from the Term start date to the Term end date.
Formula | (Index Value on Term end date - Index Value on Term start date) / Index Value on Term start date | |
Calculation | (782.76 815.37) / 815.37 = -4.00% |
Thus, the Index has fallen 4% .
For the 6-year 10% Buffer with Upside Participation Rate Strategy, the value at the end of the Term is based on the rise or fall in the index over the entire 6-year Term. The rise or fall in Index for the Term is equal to the percentage change in the Index Value measured from the Term start date to the Term end date.
Formula | (Index Value on Term end date - Index Value on Term start date) / Index Value on Term start date | |
Calculation | (782.76 1000.00) / 1000.00 = -21.7% |
Thus, the Index has fallen 21.72%.
Footnote 45. The Buffer is the decrease in the value of an Index for a Term that is disregarded when determining the Loss for the Term. The S&P 500 6-year 10% Buffer with Upside Participation Rate Strategy has a Buffer of -10% that is applied to calculate the Strategy value at the end of the 6-year Term. The 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy and the 1-year 50% Downside Participation Rate with Cap Strategy do not have a Buffer.
Footnote 46. The Downside Participation Rate is your share of any fall in the Index over a Term taken into account to determine the Strategy value at the end of the Term. In this example, the 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy and the 1-year 50% Downside Participation Rate with Cap Strategy each have a Downside Participation Rate of 50%, which means the calculation of any decrease will include 50% of any Index fall. The 6-year 10% Buffer with Upside Participation Rate Strategy does not have a Downside Participation Rate.
105
Footnote 47.
The Index has fallen 4% in Year 6 and has fallen 21.72% from the start of Year 1 to the end of Year 6.
For a 1-year Strategy, when the Index has fallen over a Term, we use the following formula to calculate the decrease for both the 1-year 50% Downside Participation Rate with Cap Strategy and the 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy .
Formula | Fall in Index for Term x Downside Participation Rate for Term = Decrease as a Percentage | |
Calculation | 4.00% x 50% = 2.00% |
For the 6-year Strategy, when the Index has fallen over a Term, we use the following formulas to calculate the decrease.
Formula | If the fall in Index is greater than Buffer, then Fall in Index Buffer = Decrease as a Percentage | |
If the fall in Index is not greater than Buffer, then Decrease as a Percentage = 0 | ||
Calculation | 21.72% fall in Index is greater than the 10% Buffer, so Decrease as a Percentage = 21.72% - 10% = 11.72% |
Footnote 48.
For both a 1-year Strategy and the 6-year Strategy, when the Index has fallen over the Term, we use the following formula to calculate the decrease.
Formula | Remaining Investment Base x decrease percentage based on fall in Index = dollar amount of decrease based on fall in Index | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$43,200 x 2.0% = $864 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$43,200 x 2.0% = $864 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$47,792 x 11.7% = $5,601 |
Footnote 49. In this example, for the 1-year Strategies, there has been a fall in the Index over the sixth Term. For the 6-year Strategy, there has also been a fall in the Index over its 6-year Term. This means that for both a 1-year Strategy and the 6-year Strategy, the Strategy value at the end of Year 6 is the Remaining Investment Base on the Term Year end date minus the decrease for the fall in the Index over the Term.
Formula | Remaining Investment Base on Term end date - dollar amount of decrease based on fall in Index = Strategy value on Term end date | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$43,200 - $864 = $42,336 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$43,200 - $864 = $42,336 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$47,792 - $5,601 = $42,191 |
This prospectus describes the material features of the Contract. Contracts issued in your state may provide different features and benefits from, and impose different costs than, those described in this prospectus because of state law variations. However, please note that the maximum charge is set forth in this prospectus. If you would like to review a copy of the Contract and any endorsements, contact us at P.O. Box 5423, Cincinnati, OH 45201-5423, visit our website at www.mmascend.com or call us at 1-800-789-6771.
The following information is a summary of material state variations as of the date of this prospectus.
General
For Contracts Issued in Illinois
References to spouse have been changed to spouse or civil union partner.
For Contracts Issued in Missouri
No Performance Lock election is permitted.
When taken from Indexed Strategies, withdrawals are taken proportionately without regard to Term length.
Certain Indexed Strategies are not available.
106
For Contracts Issued in New Jersey
References to spouse have been changed to spouse or civil union partner.
Extended Care Waiver Rider
For Contracts Issued in California
The Waiver of Early Withdrawal Charges for Facility Care or Home Care or Community-Based Services Rider (CA Rider) provides a waiver under an expanded set of circumstances. The waiver will apply if, at the time of the withdrawal or surrender, or within the immediately preceding 90 days, the following conditions are met: (1) the insured is confined in a facility or is receiving, as prescribed by a physician, registered nurse or licensed social worker, home care or community-based services; (2) the insureds confinement in a facility, the insureds receipt of home care or community-based services, or any combination thereof has continued for a period of at least 90 consecutive days; and (3) the first day of such 90-day period was at least one year after the contract effective date. Facility includes a skilled nursing facility, a convalescent nursing home, or an extended care facility or a residential care facility or a residential care facility for the elderly. Home care or community-based services includes home health care, adult day care, personal care, homemaker services, hospice services and respite care as defined in the rider. Additional conforming changes have been made including revised and new definitions, and inclusion of a description of circumstances under which the waiver does not apply. The termination provision has been modified to reflect that the rider will not terminate if you transfer or assign an interest in the contract to a person or entity other than the insured.
For Contracts Issued in Connecticut
The conditions under which the waiver applies have been modified. The waiver will apply if at the time of a withdrawal or surrender or within the immediately preceding 90 days all of the following conditions are met: (1) an insured is confined in a long-term care facility or hospital; and (2) the confinement has continued for a period of at least 90 consecutive days.
For Contracts Issued in Kansas
The conditions under which the waiver applies have been modified. The first day of confinement must be at least 90 days after the contract effective date, rather than one year after the contract effective date.
For Contracts Issued in Massachusetts
This waiver rider is not available in Massachusetts.
For Contracts Issued in Missouri
This waiver rider is not available in Missouri.
For Contracts Issued In Montana
The definition of medically necessary has been modified and refers to the Insureds physician.
For Contracts Issued in Nebraska
The definition of skilled nursing facility has been modified by adding a licensed practical nurse to the list of persons who may provide nursing services or supervise the provision of nursing services.
For Contracts Issued in New Hampshire
The definition of skilled nursing facility has been modified by changing the phrase licensed and operated as a skilled nursing facility to operated as a skilled nursing facility.
For Contracts Issued in Pennsylvania
The conditions under which the waiver is available have been modified. The waiver will apply if at the time of a withdrawal or surrender or within the immediately preceding 90 days all of the following conditions are met: (1) an insured is confined in one or more long-term care facilities, hospital, or a combination of such; (2) the confinement is prescribed by a physician and is medically necessary; (3) the first day of the confinement is at least one year after the contract effective date; and (4) the confinement has continued for a period of at least 90 consecutive days, or has continued for a total of at least 90 days if each successive confinement occurs within six months of the previous confinement and is for the same related medical cause.
107
The definition of long-term care facility has been modified. The following facilities have been deleted from the list of facilities excluded from that definition: a facility that primarily treats drug addicts and a facility that is a home for the mentally ill. An exclusion provision has been added to clarify that the waiver will not apply if the insured is confined in a long-term care facility or hospital for the treatment of certain types of drug addiction or mental illnesses.
The definition of hospital has been modified by changing the phrase it maintains, or has access to, medical, diagnostic, and major surgical facilities to it maintains, or has access to, medical and diagnostic facilities.
For Contracts Issued in Vermont
The definition of long-term care facility has been modified. The following facilities have been deleted from the list of excluded facilities: a facility that primarily treats drug addicts, a facility that primarily treats alcoholics, and a facility that is a home for the mentally ill. In addition, the definition of physician has been modified by changing the phrase a person who is licensed in the United States as a medical doctor or a doctor of osteopathy and who is practicing within the scope of his or her license to a person who is licensed in the United States who is providing medical care and treatment when such services are provided within the scope of his or her license and provided pursuant to applicable law.
For Contracts Issued in Washington
The waiver is based on confinement to an extended care facility or hospital rather than a long-term care facility or hospital. Definitions are modified to reflect the new terminology, references to skilled nursing facility are changed to nursing facility and the related definition is modified. In the definition of nursing facility and hospital, a licensed practical nurse is added to the list of persons who may provide nursing services or supervise the provision of nursing services.
Terminal Illness Waiver Rider
For Contracts Issued in Illinois
As a result of the terminal illness, your life expectancy must be 24 months from the date of death, rather than 12 months.
For Contracts Issued in Kansas
As a result of the terminal illness, your life expectancy must be 24 months from the date of death, rather than 12 months. The diagnosis must be rendered 90 days after the contract effective date, rather than one year after the contract effective date.
For Contracts Issued in New Jersey
The requirement related to the timing of the diagnosis does not apply. But the waiver will not be available until at least one year after the contract effective date.
For Contracts Issued in Massachusetts
This waiver rider is not available in Massachusetts.
For Contracts Issued in Pennsylvania
The diagnosis must be rendered after the contract effective date, rather than one year after the contract effective date. But the waiver will not be available until at least one year after the contract effective date. In addition, the waiver is based on a terminal condition as defined in the rider, rather than a terminal illness.
For Contracts Issued in Texas
The diagnosis must be rendered on or after the contract effective date, rather than one year after the contract effective date.
For Contracts Issued in Washington
As a result of the terminal illness, your life expectancy must be 24 months from the date of death, rather than 12 months.
Form of Annuity Payout Benefit
For Contracts Issued in Texas:
Payments under a Payout Option are subject to a $50 minimum.
108
Right to Cancel (Free Look)
State law governs the length of the free look period and the amount of the refund that you will receive. The period and amount may differ if you are replacing a life insurance policy or annuity contract. The table below summarizes the state law provisions.
For Contracts |
Free Look Period |
Refund |
Replacement Free Look Period |
Replacement Refund | ||||
Alabama |
20 days | Account Value |
30 days | Account Value + Fees/Charges | ||||
Alaska |
20 days | Account Value + Fees/Charges |
30 days | Account Value + Fees/Charges | ||||
Arizona |
20 days | Account Value + Fees/Charges |
30 days | Account Value + Fees/Charges | ||||
Arkansas |
20 days | Account Value |
30 days | Account Value | ||||
California |
30 days | Account Value + Fees/Charges Note: If owner is age 60 or older, refund amount is Purchase Payments. |
30 days | Account Value + Fees/Charges Note: If owner is age 60 or older, refund amount is Purchase Payments. | ||||
Colorado |
20 days | Account Value |
30 days | Account Value + Fees/Charges | ||||
Connecticut |
20 days | Account Value + Fees/Charges |
30 days | Account Value + Fees/Charges | ||||
Delaware |
20 days | Account Value |
30 days | Purchase Payments | ||||
District of Columbia |
20 days | Account Value |
30 days | Account Value | ||||
Florida |
21 days | Account Value + Fees/Charges |
30 days | Account Value + Fees/Charges | ||||
Georgia |
20 days | Purchase Payments |
30 days | Purchase Payments | ||||
Hawaii |
20 days | Account Value |
30 days | Account Value + Fees/Charges | ||||
Idaho |
20 days | Purchase Payments |
30 days | Purchase Payments | ||||
Illinois |
20 days | Account Value + Fees/Charges |
30 days | Account Value + Fees/Charges | ||||
Indiana |
20 days | Account Value |
30 days | Purchase Payments | ||||
Iowa |
20 days | Account Value |
30 days | Account Value + Fees/Charges | ||||
Kansas |
20 days | Account Value + Fees/Charges |
30 days | Account Value + Fees/Charges | ||||
Kentucky |
20 days | Purchase Payments |
30 days | Account Value + Fees/Charges | ||||
Louisiana |
20 days | Purchase Payments |
30 days | Account Value + Fees/Charges | ||||
Maine |
20 days | Account Value |
30 days | Account Value + Fees/Charges | ||||
Maryland |
20 days | Purchase Payments |
30 days | Account Value + Fees/Charges | ||||
Massachusetts |
20 days | Account Value |
30 days | Purchase Payments | ||||
Michigan |
20 days | Account Value + Fees/Charges |
30 days | Account Value + Fees/Charges | ||||
Minnesota |
20 days | Account Value + Fees/Charges |
30 days | Purchase Payments | ||||
Mississippi |
20 days | Account Value |
30 days | Account Value + Fees/Charges | ||||
Missouri |
20 days | Purchase Payments |
30 days | Purchase Payments | ||||
Montana |
20 days | Account Value |
30 days | Account Value + Fees/Charges | ||||
Nebraska |
20 days | Purchase Payments |
30 days | Account Value + Fees/Charges | ||||
Nevada |
20 days | Purchase Payments |
30 days | Purchase Payments | ||||
New Hampshire |
20 days | Purchase Payments |
30 days | Account Value + Fees/Charges | ||||
New Jersey |
20 days | Account Value + Fees/Charges |
30 days | Account Value + Fees/Charges | ||||
New Mexico |
20 days | Account Value |
30 days | Account Value + Fees/Charges | ||||
North Carolina |
20 days | Purchase Payments |
30 days | Account Value + Fees/Charges | ||||
North Dakota |
20 days | Account Value + Fees/Charges |
30 days | Account Value + Fees/Charges | ||||
Ohio |
20 days | Account Value |
30 days | Account Value + Fees/Charges | ||||
Oklahoma |
20 days | Purchase Payments |
30 days | Purchase Payments | ||||
Oregon |
20 days | Account Value |
30 days | Account Value + Fees/Charges | ||||
Pennsylvania |
20 days | Account Value |
30 days | Account Value | ||||
Rhode Island |
20 days | Purchase Payments |
30 days | Account Value + Fees/Charges | ||||
South Carolina |
20 days | Purchase Payments |
30 days | Account Value + Fees/Charges | ||||
South Dakota |
20 days | Account Value + Fees/Charges |
30 days | Account Value + Fees/Charges | ||||
Tennessee |
20 days | Account Value |
30 days | Purchase Payments | ||||
Texas |
20 days | Purchase Payments |
30 days | Account Value + Fees/Charges | ||||
Utah |
20 days | Purchase Payments |
30 days | Purchase Payments | ||||
Vermont |
20 days | Account Value |
30 days | Account Value + Fees/Charges | ||||
Virginia |
20 days | Account Value |
30 days | Account Value + Fees/Charges | ||||
Washington |
20 days | Greater of: (1) Purchase Payments or (2) Account Value minus taxes |
30 days | Purchase Payments | ||||
West Virginia |
20 days | Account Value |
30 days | Account Value + Fees/Charges | ||||
Wisconsin |
30 days | Account Value |
30 days | Account Value + Fees/Charges | ||||
Wyoming |
20 days | Account Value |
30 days | Greater of: (1) Purchase Payments or (2) Account Value + Fees/Charges |
109
Assignment
For Contracts Issued in Ohio:
Subject to the tax qualifications endorsement, if any, you may assign your rights to designate or change a Beneficiary or an Annuitant, to change Owners, or to elect a Payout Option if you make a specific Request in Good Order.
Amendment of the Contract
For Contracts Issued in Florida:
You have the right to reject an endorsement that changes the provisions of this Contract to obtain or retain the intended tax treatment under federal tax law, or to take into account other pertinent laws and governmental regulations and rulings. We will not be responsible for the tax or other consequences of your rejection.
For Contracts Issued in Texas:
You have the right to reject an endorsement that changes the provisions of this Contract to obtain or retain the intended tax treatment under federal tax law, or to take into account other pertinent laws and governmental regulations and rulings. We will not be responsible for the tax or other consequences of your rejection.
Involuntary Termination
For Contracts Issued in Texas:
Our right to terminate this Contract is not tied to the minimum required value. We have the right to terminate this Contract if the Account Value would provide a benefit of less than $20 each month at age 70 under a life payout with payments for at least a fixed period of 10 years.
Our form number for the Contract is P1833621NW. Our form numbers for the Indexed Strategy endorsements to the Contract are E1825418NW, E1825518NW, E1825618NW, E1825718NW, E1825818, E1825918NW, E1826018NW, E1826118NW, E1849922NW, E1850022NW, E1850122NW, E1850522NW, E1850622NW, E1850722NW, E1849122NW, and E1849222NW. Our form number for the Death Benefit endorsement to this Contract is E1826318NW. The form numbers may vary by state. The Securities and Exchange Commission file number for the Contract is 333-[ ].
MASSMUTUAL ASCEND LIFE INFORMATION
[to be added by amendment]
110
MASSMUTUAL ASCEND LIFE INSURANCE COMPANY
Administrative Office: P.O. Box 5423, Cincinnati OH 45201-5423
Street Address: 191 Rosa Parks Street, Cincinnati OH 45202
Policy Administration: 1-800-789-6771
INDEX SUMMIT 6 PRO ANNUITY
PROSPECTUS DATED [ ], 2023
The Index Summit 6® Pro annuity is an Individual Index-linked Modified Single Premium Deferred Annuity contract issued by MassMutual Ascend Life Insurance Company. It provides that we will pay the Annuity Payout Benefit to you in exchange for your Purchase Payments.
The Contract is a modified single premium deferred annuity. This means we will accept Purchase Payments only during the purchase payment period, which ends two months after the Contract Effective Date.
A glossary of defined terms used herein can be found in the Special Terms section starting on page [ ] of this prospectus.
The Contract offers you the opportunity to allocate funds to Indexed Strategies for one-year, two-year, or six-year Terms. Indexed Strategies provide price returns based, in part, on the rise or fall of an Index, which may be a market index, such as the S&P 500 Index, or the share price of an exchange-traded fund, such as an iShares ETF. The returns of the S&P 500 Index do not reflect the payment of dividends by stocks that make up the Index.
For this Contract, we currently offer fifteen Indexed Strategies. Each of these Indexed Strategies uses one of five Indexes: S&P 500® Index, iShares® MSCI EAFE ETF, and iShares® U.S. Real Estate ETF, SPDR Gold Share ETF, and First Trust Barclays Edge Index. When an Index rises over a Term, Indexed Strategy values are determined using one of two positive return factors: either a Cap or an Upside Participation Rate. When an Index falls over a Term, Indexed Strategy values are determined using one of four negative return factors: either a 50% Downside Participation Rate, a 10% Buffer, a -10% Floor, or a 0% Floor. Note: Not all Indexed Strategies are available for Contracts issued in Missouri.
At the end of a Term, we may stop offering any Indexed Strategy, other than the S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate Indexed Strategy. The S&P 500 6-year 10% Buffer with Upside Participation Rate Indexed Strategy will only be available for Terms beginning in the first Contract Year. The S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate Indexed Strategy or any other Indexed Strategy that may be available in the future may earn a return that is lower than the return your investments would have earned if they had been invested in the other currently available Indexed Strategies. Any reduction in the available number of Index Strategies may reduce your opportunity to increase your Account Value.
Indexed Strategies. The value of an Indexed Strategy changes from day to day throughout each Term. The value of an Indexed Strategy is calculated using the Investment Base.
The Investment Base is the amount applied to the Indexed Strategy at the beginning of the current Term, reduced each day by the Daily Charge, and adjusted proportionally for any withdrawals taken during the current Term and any related Early Withdrawal Charge. During the Term, the Investment Base remains unchanged except for the Daily Charge and any proportional adjustments for withdrawals.
The Daily Charge is calculated as a percentage of the Investment Base. The Daily Charge is a rate that compounds to 0.75% per year.
The method used to calculate the Strategy value depends on whether the value is being calculated at the end of a Term or during a Term and on whether you have made a Performance Lock election.
At the end of a Term, unless you have made a Performance Lock election, the value of an Indexed Strategy is the Investment Base increased for any rise in the applicable Index over the Term or decreased for any fall in the applicable Index over the Term. For some Strategies, any increase for the Term is subject to a limit called the Cap (a Cap Strategy). For others, any increase for the Term is subject to a limit called the Upside Participation Rate (an Upside Participation Rate Strategy). For an Indexed Strategy with a Buffer (a Buffer Strategy), any decrease for the Term resulting from Index performance is subject to a limit called the Buffer. For an Indexed Strategy with a Floor (a Floor Strategy), any decrease for the Term resulting from Index performance is subject to a limit called the Floor. For all other Strategies, any decrease for the Term resulting from Index performance is subject to a limit called the Downside Participation Rate (a Downside Participation Rate Strategy).
| For a Cap Strategy, the Cap for a Term is the largest rise in the Index over the Term taken into account to determine the Strategy value at the end of the Term. We can change the Cap for each new Term of an Indexed Strategy. It will never be less than 1%. At least 10 days before the next Term starts, we will post the Caps for that Term on our website (www.massmutualascend.com/RILArates). |
| If the rise in the Index is greater than the Cap, the increase applied to the remaining Investment Base for the Term will be limited to the Cap and will be less than the rise in the Index. |
| If the rise in the Index is equal to the Cap, the increase applied to the remaining Investment Base for the Term will equal both the Cap and the rise in the Index. |
1
| If the rise in the Index is less than the Cap, the increase for the Term will be less than the Cap and will equal the rise in the Index applied to the remaining Investment Base. |
| In both cases, the increase for a Term will always be less than the Cap or the rise in the Index because the Daily Charge is subtracted from the Investment Base before applying the increase for the Index performance. |
| For an Upside Participation Rate Strategy, the Upside Participation Rate for a Term is the portion of any rise in the Index over the Term that is taken into account to determine the Strategy value at the end of the Term. We can change the Upside Participation Rate for each new Term of an Indexed Strategy. It never will be less than 5%. At least 10 days before the next Term starts, we will post the Upside Participation Rates for that Term on our website (www.massmutualascend.com/RILArates). The increase for the Term will be less than the rise in the Index unless the Participation Rate for the Term exceeds 100%. The increase for a Term will be less than the Upside Participation Rate multiplied by the rise in the Index because the Daily Charge is subtracted from the Investment Base before applying the increase for Index performance. |
| For a Buffer Strategy, the Buffer provides a buffer against the first 10% of any fall in the Index over the Term to determine the Strategy value for the Buffer Strategy at the end of the Term. For each Term of the Buffer Strategy, the Buffer is 10%. In addition to the Daily Charge, the decrease for the Term will equal the amount, if any, by which the fall in the Index exceeds 10%. For example, if the Index decreases over the Term by 50%, the Buffer limits the change in Strategy value for the Term to -40%, in addition to the Daily Charge. |
| For a Floor Strategy, the Floor is the most negative portion of any fall in the Index for the Term that is taken into account to determine the Strategy value for a Floor Strategy at the end of the Term. The value of a 0% Floor Strategy will not decrease even if there is a negative change in the applicable Index value during a Term. The value of a -10% Floor Strategy will decrease if there is a negative change in the applicable Index value during a Term, but the Strategy value will never decrease by more than -10% for the Term. |
For a Downside Participation Rate Strategy, the Downside Participation Rate is the portion of any fall in the Index over the Term taken into account to determine the Strategy value at the end of the Term. For each Term of each Strategy with a Downside Participation Rate, the Downside Participation Rate is 50%. In addition to the Daily Charge, the decrease for the Term will be only half of the fall in the Index.
Unless you have made a Performance Lock election, any increase in the value of an Indexed Strategy at the end of a Term is based on the value of the underlying Index on the final Market Day of the Term. This means that you may experience negative or flat performance for the Term even though the underlying Index rose throughout some or most of the Term.
Before the end of a Term, unless you have made a Performance Lock election, the value of an Indexed Strategy is the Investment Base increased or decreased by the Daily Value Percentage. The Daily Value Percentage is based on hypothetical options that represent the projected change in the Index over the full Term, and is equal to the Net Option Price, reduced by the Amortized Option Cost and the Trading Cost. The Daily Value Percentage is applied to determine Strategy values when you withdraw funds allocated to an Indexed Strategy or Surrender your Contract before the end of a Term. The Daily Value Percentage is also applied if the Death Benefit or Annuity Payout value are determined before the end of a Term.
You may make a Performance Lock election for an S&P 500 Indexed Strategy or for a First Trust Barclays Edge Indexed Strategy for a Term that starts after the date of this prospectus. If you make a Performance Lock election, the Strategy value is determined based on the Daily Value Percentage locked at the second Market Close following receipt of your election. Thereafter, that locked Daily Value Percentage will apply to determine the Strategy value on each subsequent day of the Term, including the value at the end of the Term. A Performance Lock election does not affect the Investment Base, so the Indexed Strategy value will still change if the Investment Base is reduced by a withdrawal. Note: A Performance Lock election is not available for Contracts issued in Missouri.
An Indexed Strategy includes a risk of potential loss, which may include both your original principal and prior earnings. This potential loss will exceed any decrease resulting from a fall in an Index because (i) the Daily Charge will reduce the Investment Base upon which Strategy values are based, (ii) the decline in the Daily Value Percentage during a Term may exceed the fall in the Index, and (iii) a withdrawal or Surrender may be subject to an Early Withdrawal Charges. For withdrawals before the end of a Term or if a Performance Lock election is made, the potential loss may exceed the Floor, the Downside Participation Rate, or may not receive the full protection of the Buffer, because the Daily Value Percentage during a Term is not directly limited by the Floor, Downside Participation Rate, or Buffer. These same factors could cause you to realize losses even when the Index rises. For example, you will lose value if the amount of increase attributable to an Index rise is smaller than the amount needed to offset the Daily Charge or Early Withdrawal Charge.
Availability of Indexed Strategies. The S&P 500 6-year 10% Buffer with Upside Participation Rate Strategy is only available for Terms that begin in the first Contract Year and cannot be renewed at the end of the 6-year Term. The S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate Indexed Strategy will always be available. At the end of a Term, we may eliminate any other Indexed Strategy other than the S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate Indexed Strategy in our discretion. We have the right to replace the Index associated with an Indexed Strategy under certain circumstances. A reduction in the number of available Indexed Strategies or a replacement of an underlying Index could materially limit the growth potential of your investment in this Contract. In the future, we may offer new Indexed Strategies with Downside Participation Rates that are greater than 50%, Buffers that are lower than 10% or Floors that are more negative. An allocation of funds to an Indexed Strategy with a higher Downside Participation Rate, a lower Buffer, or a more negative Floor could materially increase the loss potential related to this Contract.
2
Early Withdrawal Charge. The Contract is intended for long-term investment purposes and may not be appropriate for investors who plan to take withdrawals (including systematic withdrawals and required minimum distributions) during the first six Contract Years. During the first six Contract Years, an Early Withdrawal Charge applies if you Surrender your Contract. It also applies to any withdrawal in excess of the Free Withdrawal Allowance, including automatic withdrawals and withdrawals taken to satisfy a required distribution. The early withdrawal charge is 9% for withdrawals and Surrenders of the Contract in the first Contract Year, and falls each Contract Year during the six-year period. Withdrawals and Surrenders may also be subject to income tax, and withdrawals and Surrenders before age 591/2 may also be subject to an additional 10% penalty tax.
Risk Factors for this Contract appear on pages [ ] and pages [ ]. Indexed annuity contracts are complex insurance and investment vehicles. You should speak with a financial advisor about the Index Summit 6 Pro annuity and its features, benefits, risks, and charges, and whether the Contract is appropriate for you based upon your financial situation and objectives.
Please read this prospectus before investing and keep it for future reference. It contains important information about your Contract and MassMutual Ascend Life that you ought to know before investing. It describes all material rights and obligations under the Contract. The provisions of the Contract may vary from state to state. All material state variations are identified in the State Variations section of this prospectus.
All guarantees under the Contract are the obligations of MassMutual Ascend Life and are subject to the credit worthiness and claims-paying ability of MassMutual Ascend Life.
****************************************
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED THESE SECURITIES OR PASSED UPON THE ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
| The Contract is not insured by the FDIC (Federal Deposit Insurance Corporation) or the NCUSIF (National Credit Union Share Insurance Fund). |
| Although the Contract may be sold through relationships with banks or other financial institutions, the Contract is not a deposit or obligation of, or guaranteed by, such institutions or any federal regulatory agency. |
The Contract doesnt invest in any equity, debt, or other investments.
****************************************
The principal underwriter of the Contract is MM Ascend Life Investor Services, LLC. The offering of the Contract is intended to be continuous. The underwriter will use its best efforts to sell the Contract.
This prospectus is not an offering in any state, country, or jurisdiction in which we are not authorized to sell the Contract.
If you purchase a Contract, you may cancel it within 20 days after you receive it. If you purchase a Contract to replace an existing annuity contract or insurance policy, you have 30 days to cancel the Contract. The right to cancel period may be longer in some states. In most states, you will bear the risk of any decreases in Indexed Strategy values before cancellation. The right to cancel is described more fully in the Right to Cancel section of this prospectus.
3
Table of Contents
5 | ||||
5 | ||||
8 | ||||
9 | ||||
15 | ||||
21 | ||||
28 | ||||
33 | ||||
35 | ||||
38 | ||||
43 | ||||
46 | ||||
47 | ||||
48 | ||||
49 | ||||
50 | ||||
51 | ||||
51 | ||||
52 | ||||
54 | ||||
55 | ||||
58 | ||||
59 | ||||
60 | ||||
60 | ||||
60 | ||||
60 | ||||
61 | ||||
62 | ||||
62 | ||||
63 | ||||
66 | ||||
67 | ||||
68 | ||||
68 | ||||
69 | ||||
69 | ||||
69 | ||||
72 | ||||
106 | ||||
110 |
4
SECTION I
INDEX SUMMIT 6 PRO ANNUITY INFORMATION
In this prospectus, the following capitalized terms have the meanings set out below.
ACCOUNT VALUE. For each day, the Account Value is the sum of the current values of each Indexed Strategy, plus the current value of the Purchase Payment Account, if any.
ANNUITANT. The natural person or persons on whose life the Annuity Payout Benefit is based.
ANNUITY PAYOUT BENEFIT. A series of periodic payments made under a Payout Option. The terms and conditions are described in the Annuity Payout Benefit section of this prospectus.
ANNUITY PAYOUT INITIATION DATE. The first day of the first payment interval for which payment of an Annuity Payout Benefit is to be made. This is the date we apply your Account Value to the Annuity Payout Benefit and calculate the payment amount.
BENEFICIARY. A person entitled to receive all or part of a Death Benefit that is to be paid under the Contract on account of a death before the Annuity Payout Initiation Date.
BUFFER. For an Indexed Strategy with a Buffer (a Buffer Strategy), the Buffer is the decrease in the value of an Index for a Term that is disregarded when determining the Loss for the Term. The Buffer is also used in the calculation of the Daily Value Percentage before the end of the Term. For each Term of the Buffer Strategy that we currently offer with this Contract, the Buffer is 10%. In the future, we may offer a new Strategy with a Buffer that is more or less than 10%.
CAP. For an Indexed Strategy with a Cap (a Cap Strategy), the Cap is the largest rise in the Index over the Term that is taken into account to determine the Strategy value at the end of the Term. The Cap is also used in the calculation of the Daily Value Percentage for that Strategy before the end of the Term. We post on our website (www.massmutualascend.com/RILArates) the Cap for each Term of a Cap Strategy at least 10 days before the next Term starts. For a given Term, we may set a different Cap for amounts attributable to Purchase Payments received on different dates.
CONTRACT. The annuity contract that is a legally binding agreement between you and MassMutual Ascend Life, including applicable endorsements and riders.
CONTRACT ANNIVERSARY. The date in each year that is the annual anniversary of the Contract Effective Date. That date is set out on your Contract Specifications Page.
CONTRACT EFFECTIVE DATE. The date as of which the initial Purchase Payment is applied to the Contract. That date is set out on your Contract Specifications Page.
CONTRACT SPECIFICATIONS PAGE. The page in your Contract that contains details unique to your Contract.
CONTRACT YEAR. A 12-month period that starts on the Contract Effective Date or on a Contract Anniversary.
DAILY CHARGE. The charge for maintaining your Contract. It is a daily rate that compounds at 0.75% per year. It is calculated daily as a percentage of, and is subtracted from, the then remaining investment base of each Indexed Strategy.
DAILY VALUE PERCENTAGE. The Daily Value Percentage is used to determine the value of an Indexed Strategy before the end of a Term. For each day of a Term of an Indexed Strategy before the final Market Day of the Term, the Daily Value Percentage is equal to: (1) the Net Option Price for that day; minus (2) the Amortized Option Cost for that day; and minus (3) the Trading Cost for that day.
See the next section (Special Terms Related to Daily Value Percentage) for the definitions of Amortized Option Cost, Net Option Price, and Trading Cost.
DEATH BENEFIT. An amount that becomes payable if you die before the Annuity Payout Initiation Date and before the date that the Contract is Surrendered. The terms and conditions are described in the Death Benefit section of this prospectus.
5
DOWNSIDE PARTICIPATION RATE. For an Indexed Strategy with a Downside Participation Rate (a Downside Participation Rate Strategy), the Downside Participation Rate is your share of any fall in the Index over a Term taken into account to determine the Strategy value at the end of the Term. The Downside Participation Rate is also used in the calculation of the Daily Value Percentage before the end of the Term. For every Term of each Strategy other than the Buffer Strategy that we currently offer with this Contract, the Downside Participation Rate is 50%. In the future, we may offer a new Strategy with a Downside Participation Rate that is more or less than 50%.
EARLY WITHDRAWAL CHARGE. A charge deducted from the Account Value of your Contract if, during the first six Contract Years, you Surrender your Contract or you take a withdrawal in excess of the Free Withdrawal Allowance (including systematic withdrawals and required minimum distributions). The Early Withdrawal Charge does not apply to a withdrawal that qualifies for the Free Withdrawal Allowance or the amount, if any, that qualifies for another waiver. The Early Withdrawal Charge does not apply to an Annuity Payout Benefit or Death Benefit.
FLOOR. For an Indexed Strategy with a Floor (a Floor Strategy), the Floor is the decrease in the value of an Index for a Term that is taken into account when determining the Loss for the Term. The Floor is also used in the calculation of the Daily Value Percentage before the end of the Term. For each Term of a Floor Strategy that we currently offer with this Contract, the Floor is -10% or 0%. In the future, we may offer a new Strategy with a Floor that is more or less negative than -10%
FREE WITHDRAWAL ALLOWANCE. The total amount that may be taken as a withdrawal or Surrendered during a Contract Year without an Early Withdrawal Charge that might otherwise apply. This amount is described in the Free Withdrawal Allowance section of this prospectus.
INDEX. A stock market index or an exchange-traded fund (ETF) used to calculate the value of an Indexed Strategy. The Index at the start of a Term is its level or price at the last Market Close on or before the first day of that Term. The Index at the end of a Term is its level or price at the final Market Close of that Term.
INDEXED STRATEGY. A specified method by which values are calculated for a Term. Each Indexed Strategy provides a return based, in part, on changes in the level or price of an Index over a Term. The Indexed Strategies that are currently available are set out on the first page of this prospectus.
INVESTMENT BASE. The base amount used to calculate the value of an Indexed Strategy. The Investment Base is the amount applied to an Indexed Strategy at the start of a current Term, adjusted proportionally for any withdrawal during the Term and any related Early Withdrawal Charge. The Investment Base is reduced daily by an amount equal to the Daily Charge.
MARKET CLOSE. The close of the regular or core trading session on the market used to measure a given Index.
MARKET DAY. Each day that all markets that are used to measure the available Indexes are open for regular trading.
MASSMUTUAL ASCEND LIFE (WE, US, OUR, MMALIC). MassMutual Ascend Life Insurance Company.
OWNER (YOU, YOURS). The person(s) who possesses the ownership rights under the Contract. If there is more than one Owner, each Owner will be a joint owner of the Contract and each reference to Owner means joint owners.
PAYOUT OPTION. The form in which an Annuity Payout Benefit or a Death Benefit may be paid. Standard options are described in the Payout Options section of this prospectus.
PERFORMANCE LOCK. An election to lock in the Daily Value Percentage for the remainder of a Term of an Indexed Strategy. A Performance Lock election for a Term is effective on the second Market Close following our receipt of your Request in Good Order. After the second Market Close, the Indexed Strategy value before the end of the Term and the Indexed Strategy Value at the end of the Term is based on the Daily Value Percentage as determined for that second Market Close. This means that the Net Option Value, Amortized Option Cost, and Trading Cost as of that second Market Close will apply from that date on through the end of the Term. Note: A Performance Lock election is not available for Contracts issued in Missouri.
PURCHASE PAYMENT. An amount received by us for the Contract. This amount is determined after deducting any taxes withheld from the payment and after deducting any fee charged by the person remitting payment.
PURCHASE PAYMENT ACCOUNT. An account where a Purchase Payment is held until it is applied to an Indexed Strategy on a Strategy Application Date.
REQUEST IN GOOD ORDER. An election or a request that is:
| complete and satisfactory to us; |
| sent to us on our form or in a manner satisfactory to us, which may, at our discretion, be by telephone or electronic means; and |
| received at our administrative office. |
6
An election or a request is complete and satisfactory when we have received: (1) all the information and legal documentation that we require to process the election or the request; and (2) instructions that are sufficiently clear that we do not need to exercise any discretion to process the election or the request. If you have any questions, you should contact us or your registered representative before submitting your election or your request.
STRATEGY APPLICATION DATE. The 6th and 20th days of each month.
SURRENDER. The termination of your Contract in exchange for its Surrender Value.
SURRENDER VALUE. For each day, the Surrender Value is the Account Value on that day minus the Early Withdrawal Charge that would apply on a Surrender of the Contract. The Account Value will reflect the applicable Strategy values as calculated on that day, which will reflect the Daily Value Percentage whenever Surrender Value is measured before the end of a Term.
TAX-QUALIFIED CONTRACT. An annuity contract that is intended to qualify for special tax treatment for retirement savings. If your Contract is a Tax-Qualified Contract, the cover page of your Contract includes information about its tax qualification. If your Contract is not a Tax-Qualified Contract, the cover page of your Contract will identify it as a Nonqualified Annuity.
TERM. The period for which Contract values are allocated to a given Indexed Strategy, and over which values are calculated. Terms are one year long, two years long, or six years long. Each Term will start and end on a Strategy Application Date. A new Term will start on the date that the preceding Term ends.
UPSIDE PARTICIPATION RATE. For an Indexed Strategy with an Upside Participation Rate (an Upside Participation Rate Strategy), the Upside Participation Rate is your share of any rise in the Index over a Term taken into account to determine the Strategy value at the end of the Term. The Upside Participation Rate is also used in the calculation of the Daily Value Percentage before the end of the Term. We post on our website (www.massmutualascend.com/RILArates) the Upside Participation Rate for each Term of an Upside Participation Rate Strategy at least 10 days before the next Term starts. For a given Term, we may set a different Upside Participation Rate for amounts attributable to Purchase Payments received on different dates.
7
SPECIAL TERMS RELATED TO DAILY VALUE PERCENTAGE
AMORTIZED OPTION COST. The Amortized Option Cost is one part of the Daily Value Percentage used to determine the value of an Indexed Strategy each day before the final Market Day of a Term. The Amortized Cost for a day is calculated for the last Market Close on or before that day. The Amortized Option Cost is a percentage equal to: (1) the initial Net Option Price for an Indexed Strategy for the Term; multiplied by (2) the number of days remaining until the final Market Close of that Term divided by 365 days if that Term is one year long, or by 730 days if that Term is two years long, or by 2,192 days if that Term is six years long. The initial Net Option Price is the Net Option Price calculated for the last Market Close on or before the start of the Term.
NET OPTION PRICE. The Net Option Price is one part of the Daily Value Percentage used to determine the value of an Indexed Strategy before the final Market Day of a Term. The Net Option Price for a day is calculated for the last Market Close on or before that day.
| For strategies with a Cap and a Downside Participation Rate, the Net Option Price as of a Market Close is equal to: (1) the ATM Call Option Price calculated for that Market Close; minus (2) the OTM Call Option Price calculated for that Market Close; and minus (3) the ATM Put Option Price calculated for that Market Close multiplied by the Downside Participation Rate. |
| For strategies with an Upside Participation Rate and a Downside Participation Rate, the Net Option Price as of a Market Close is equal to: (1) the ATM Call Option Price calculated for that Market Close multiplied by the Upside Participation Rate; minus (2) the ATM Put Option Price calculated for that Market Close multiplied by the Downside Participation Rate. |
| For strategies with an Upside Participation Rate and a Buffer, the Net Option Price as of a Market Close is equal to: (1) the ATM Call Option Price calculated for that Market Close multiplied by the Upside Participation Rate; minus (2) the OTM Put Option Price calculated for that Market Close. |
| For Floor Strategies, the Net Option Price as of a Market Close is equal to: (1) the ATM Call Option Price calculated for that Market Close; minus (2) the OTM Call Option Price calculated for that Market Close; minus (3) the ATM Put Option Price calculated for that Market Close; and plus (4) the OTM Put Option Price calculated for that Market Close. |
| For strategies with a Cap and a Buffer, the Net Option Price as of a Market Close is equal to: (1) the ATM Call Option Price calculated for that Market Close; minus (2) the OTM Call Option Price calculated for that Market Close; and minus (3) the OTM Put Option Price calculated for that Market Close. |
The option prices in these formulas reflect the possible future change in the Index over the remainder of the Term. The formulas take into account the Cap or the Upside Participation Rate for the Term and the Downside Participation Rate, the Buffer or the Floor.
Each option price is stated as a percentage of the Index calculated for the last Market Close on or before the first day of the Term. The option price is an average of the bid-ask prices calculated for the hypothetical option.
ATM CALL OPTION PRICE. The calculated price of a hypothetical at-the-money call option. The hypothetical at-the-money call option is one that will pay the holder an amount equal to the percentage rise, if any, in the Index from the last Market Close on or before the start of a Term to the final Market Close of that Term.
ATM PUT OPTION PRICE. The calculated price of a hypothetical at-the-money put option. The hypothetical at-the-money put option is one that will pay the holder an amount equal to the percentage fall, if any, in the Index from the last Market Close on or before the start of a Term to the final Market Close of that Term.
OTM CALL OPTION PRICE. The calculated price of a hypothetical out-of-the-money call option. The hypothetical out-of-the-money call option is one that will pay the holder an amount equal to the percentage rise, if any, in the Index from the last Market Close on or before the start of a Term to the final Market Close of that Term, but only if and to the extent that rise exceeds the Cap for that Term.
OTM PUT OPTION PRICE. The calculated price of a hypothetical out-of-the-money put option. The hypothetical out-of-the-money put option is one that will pay the holder an amount equal to the percentage decrease, if any, in the Index from the last Market Close on or before the start of the Term to the final Market Close of the Term, but only to the extent the percentage decrease exceeds the Buffer for the Term.
TRADING COST. The Trading Cost is one part of the Daily Value Percentage used to determine the value of an Indexed Strategy each day before the final Market Day of a Term. The Trading Cost is the estimated cost of selling the hypothetical options before the end of a Term. The Trading Cost for a day is a percentage set by us by the last Market Close on or before that day. The Trading Cost reflects the average market difference between option bid-ask average prices and option bid prices.
8
The MassMutual Ascend Life Index Summit 6 Pro annuity is an individual deferred indexed annuity contract that may help you accumulate retirement savings. The Contract is intended for long-term investment purposes. The Contract is a legal agreement between you as the Owner and MassMutual Ascend Life as the issuing insurance company. In the Contract, you agree to make one or more Purchase Payments to us and we agree to pay the Annuity Payout Benefit to you.
Like all deferred annuities, the Contract has two periods. During the period prior to the Annuity Payout Initiation Date, your Contract may accumulate earnings on a tax-deferred basis. During the period that begins on the Annuity Payout Initiation Date, we will make payments under the selected Payout Option.
The key features of the Contract are described in this Summary. Read this entire prospectus for more detailed information about the Contract.
Benefits (See Cash Benefit, Annuity Payout Benefit, and Death Benefit sections on page [ ] and [ ] for more details)
| The Annuity Payout Benefit is a series of periodic payments made under a Payout Option. This benefit can provide you with income for a fixed period of time or for life. It is based on the Account Value on the Annuity Payout Initiation Date. |
| The Cash Benefit lets you take out all of your Account Value (Surrender) or take out part of it (withdrawal). An Early Withdrawal Charge generally applies if you take money out during the first six Contract Years. You can Surrender your Contract or take a withdrawal before the Annuity Payout Initiation Date. |
| The Death Benefit is payable if you die before the Annuity Payout Initiation Date. This benefit is paid to your beneficiaries. It is based on the Account Value as of the applicable date. |
Purchase Payments and Issue Age (See Purchase section on page [ ] for more details)
The Contract is a modified single premium annuity. This means we will accept Purchase Payments only during the purchase payment period, which ends two months after the Contract Effective Date.
The initial Purchase Payment must be at least $25,000. Each additional Purchase Payment must be at least $10,000. You will need our prior approval if you want to make a Purchase Payment(s) of more than $1,000,000.
Each Owner must be age 80 or younger on the Contract Effective Date.
Indexed Strategies (See Indexed Strategies section on page [ ] for more details)
For this Contract, we currently offer fifteen Indexed Strategies. Each of these Indexed Strategies uses one of five Indexes: S&P 500® Index, iShares® MSCI EAFE ETF, iShares® U.S. Real Estate ETF, SPDR Gold Shares ETF, and Fist Trust Barclays Edge Index. Twelve of these Indexed Strategies have one-year Terms, two have two-year Terms, and one has a six-year Term.
Strategy |
Index | Term | Negative Return Factor |
Positive Return Factor | ||||
S&P 500 1-year 50% Downside Participation Rate with Cap |
S&P 500® | 1-year | 50% Downside Participation Rate |
Cap | ||||
S&P 500 2-year 50% Downside Participation Rate with Cap |
S&P 500® | 2-year | 50% Downside Participation Rate |
Cap | ||||
S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate |
S&P 500® | 1-year | 50% Downside Participation Rate |
Upside Participation Rate | ||||
S&P 500 2-year 50% Downside Participation Rate with Upside Participation Rate |
S&P 500® | 2-year | 50% Downside Participation Rate |
Upside Participation Rate | ||||
S&P 500 6-year 10% Buffer with Upside Participation Rate |
S&P 500® | 6-year | 10% Buffer | Upside Participation Rate | ||||
S&P 500 1-year 10% Buffer with Cap |
S&P 500® | 1-year | 10% Buffer | Cap | ||||
S&P 500 1-year -10% Floor with Cap |
S&P 500® | 1-year | -10% Floor | Cap | ||||
S&P 500 1-year 0% Floor with Cap* |
S&P 500® | 1-year | 0% Floor | Cap | ||||
iShares MSCI EAFE ETF 1-year 50% Downside Participation Rate with Upside Participation Rate |
MSCI EAFE ETF |
1-year | 50% Downside Participation Rate |
Upside Participation Rate | ||||
iShares MSCI EAFE ETF 1-year -10% Floor with Cap |
MSCI EAFE ETF |
1-year | -10% Floor | Cap | ||||
iShares U.S. Real Estate ETF 1-year 50% Downside Participation Rate with Upside Participation Rate |
U.S. Real Estate ETF |
1-year | 50% Downside Participation Rate |
Upside Participation Rate |
9
iShares U.S. Real Estate ETF 1-year -10% Floor with Cap |
U.S. Real Estate ETF |
1-year | -10% Floor | Cap | ||||
SPDR Gold Shares ETF 1-year -10% Floor with Cap |
SPDR Gold Shares ETF |
1-year | -10% Floor | Cap | ||||
First Trust Barclays Edge 1-year 50% Downside Participation Rate with Upside Participation Rate* |
First Trust Barclays Edge |
1-year | 50% Downside Participation Rate |
Upside Participation Rate | ||||
First Trust Barclays Edge 1-year 10% Buffer with Upside Participation Rate* |
First Trust Barclays Edge |
1-year | 10% Buffer | Upside Participation Rate |
* | The S&P 500 1-year 0% Floor with Cap Strategy and the First Trust Barclays Edge Strategies are not available for Contracts issued in Missouri. |
Contractowners who purchased the Contract before May 1, 2023, may have allocated funds to two additional Indexed Strategies. These two Indexed Strategies have been discontinued. They are not available for new or existing contractowners for any new Term that begins after May 1, 2023:
Discontinued Strategy | Index | Term | Negative Return Factor |
Positive Return Factor | ||||
iShares MSCI EAFE ETF 2-year Term with Participation Rate |
MSCI EAFE ETF | 2-year | 50% Downside Participation Rate |
Upside Participation Rate | ||||
iShares U.S. Real Estate ETF 2-year Term with Participation Rate |
U.S. Real Estate ETF | 2-year | 50% Downside Participation Rate |
Upside Participation Rate |
For existing contractowners, at the end of the current Term, any funds in one of these discontinued Indexed Strategies will be transferred to the 1-year 50% Downside Participation Rate with Upside Participation Rate Indexed Strategy that uses the same Index unless the contractowner elects otherwise.
For any Indexed Strategy with a Cap, the Cap will never be lower than 1%. For any Indexed Strategy with an Upside Participation Rate, the Upside Participation Rate will never be lower than 5%.
The Contract doesnt invest in any equity, debt, or other investments. If you buy this Contract, you arent investing directly in an Index, in the stocks included in S&P 500 Index, in the stocks and bonds of the First Trust Barclays Edge Index, in the securities or other assets held by an iShares ETF or SPDR ETF, in any underlying index tracked by an iShares ETF or SPDR ETF, or in the securities or other assets held by such underlying index. All benefits and guarantees under the Contract are the obligations of MassMutual Ascend Life and are subject to the credit worthiness and claims-paying ability of MassMutual Ascend Life.
Indexed Strategy Value (See Indexed Strategy Value at End of Term and Indexed Strategy Value Before End of Term sections below for more details)
The value of an Indexed Strategy changes from day to day throughout each Term. The method used to calculate the Strategy value depends on whether the value is being calculated at the end of a Term or during a Term, and whether a Performance Lock election has been made.
| Once the last Market Day of the Term has been reached, unless a Performance Lock election has been made, the value of an Indexed Strategy is equal to the remaining Investment Base increased for any rise in the applicable Index over that Term or decreased for any fall in the applicable Index over that Term. Any increase for the Term is limited by the Cap or Upside Participation Rate for the Term. Any decrease for the Term is limited by the Downside Participation Rate, Floor, or Buffer. |
| On each day before the last Market Day of the Term, unless a Performance Lock election has been made, the value of an Indexed Strategy is equal to the remaining Investment Base increased or decreased by the Daily Value Percentage as of the most recent Market Close. |
| If a Performance Lock election has been made, then starting with the second Market Close following receipt of the election and continuing through the end of the Term, the value of the Indexed Strategy is equal to the remaining Investment Base increased or decreased by the Daily Value Percentage locked as of that second Market Close. Note: A Performance Lock election is not available for Contracts issued in Missouri. |
A withdrawal reduces the Strategy value by the amount of the withdrawal and any related Early Withdrawal Charge.
10
Investment Base (See Indexed Strategies section on page [ ] for more details)
The value of an Indexed Strategy is calculated using the Investment Base. The Investment Base is not your Strategy Value, Account Value, Surrender Value, Annuity Payout value, or Death Benefit value, but it is used to calculate those values.
At the start of a Term, the Investment Base of an Indexed Strategy is equal to the amount applied to that Strategy for that Term. The Investment Base decreases each day during a Term by the amount of the Daily Charge.
In addition, a withdrawal reduces the Investment Base by the amount that is proportional to the reduction in the Strategy value on account of the withdrawal and any related Early Withdrawal Charge. For example, if a withdrawal and the related Early Withdrawal Charge are equal to 35% of the Strategy value, then the Investment Base for that Strategy will be reduced by 35%.
This means the dollar amount of the proportional reduction in the Investment Base will not be the same as the dollar amount of the withdrawal and the Early Withdrawal Charge.
| If the Strategy value immediately before the withdrawal is greater than the Investment Base, then the proportional reduction in the Investment Base will be less than the withdrawal and the related Early Withdrawal Charge. |
| If the Strategy value immediately before the withdrawal is less than the Investment Base, then the proportional reduction in the Investment Base will be greater than the withdrawal and the related Early Withdrawal Charge. |
Daily Charge (See Daily Charge section on page [ ] for more details)
The Investment Base is reduced daily by an amount equal to the Daily Charge. The Daily Charge is calculated using a daily rate that compounds at 0.75% per year. The Daily Charge applies whether or not you have made a Performance Lock election.
For an Indexed Strategy, it is calculated as a percentage of the remaining Investment Base and deducted daily.
At the end of a one-year Term during which no withdrawals were made, the Daily Charges through the Term End Date are equal to the Investment Base on the Term Start Date times the annual rate at which the Daily Charge compounds.
Example. At the beginning of a Term, you allocate $100,000 to an Indexed Strategy. You do not take any withdrawals during that Term. Over the course of the Term, the Daily Charge amounts to $750 ($100,000 Investment Base times 0.75% Daily Charge Rate), which reduces the Investment Base at the end of the Term to $99,250.
Before the end of a Term, the Daily Charge is the Investment Base from the prior day, multiplied by the Daily Charge rate. If no withdrawals are made during the Term, the sum of the Daily Charges from the first day of the Term to any day during the Term is equal to: Investment Base on the Term Start Date (Investment Base on the Term Start Date x (1 Daily Charge Rate) ^ number of days elapsed prior to withdrawal).
Examples. At the beginning of a Term, you allocate $100,000 to an Indexed Strategy. You do not take any withdrawals during that Term.
On Day 73 of the Term | On Day 219 of the Term | |||
Investment Base Calculation |
||||
Initial Investment Base |
$100,000 | $100,000 | ||
Accumulated Daily Charges |
$150 = ($100,000 - ($100,000 x (1 - 0.0000206251) ^ 73) |
$451 = ($100,000 - ($100,000 x (1 - 0.0000206251) ^ 219) | ||
Investment Base After Daily Charges |
$99,850 = ($100,000 - $150) |
$99,549 = ($100,000 - $451) |
Indexed Strategy Value at End of Term (See Indexed Strategy Value at End of Term section on page [ ] for more details)
At the end of a Term, unless a Performance Lock election has been made, the value of an Indexed Strategy is equal to the remaining Investment Base increased for any rise in the Index or decreased for any fall in the Index over the Term. If you have made a Performance Lock election, then the normal rules set out here do not apply, and the value at the end of a Term is determined as described under Performance Lock below.
Any increase for the Term is potentially limited by a Cap or limited by an Upside Participation Rate. The Cap for a Term is the largest rise in the Index over the Term taken into account to determine the Strategy value at the end of the Term. For example, if the Cap is 10% and the Index increases over the Term by 16%, the Cap limits the increase in Strategy value for the Term to 10%. The Upside Participation Rate for a Term is the portion of any rise in the Index over the Term that is taken into account to determine the Strategy value at the end of the Term. For example, if the Upside Participation Rate is 50% and the Index increases over the Term by 16%, the Upside Participation Rate limits the increase in Strategy value for the Term to 8%.
11
Any decrease for a Term is limited by a Downside Participation Rate, Floor, or a Buffer. The Downside Participation Rate is the portion of any fall in the Index over the Term taken into account to determine the Strategy value at the end of the Term. For example, if the Downside Participation Rate is 50% and the Index decreases over the Term by 20%, the Downside Participation Rate limits the change in Strategy value for the Term to -10%. The Floor is the portion of any fall in the Index for the Term that is taken into account to determine the Strategy value for a Strategy at the end of the Term. For example, if the Floor is -10% and the Index decreases over the Term by 20%, the Floor limits the change in Strategy value for the Term to -10%. The Buffer is the portion of any fall in the Index over the Term that is disregarded to determine the Strategy value for a Strategy at the end of the Term. For example, if the Buffer is 10% and the Index decreases over the Term by 15%, the Buffer limits the change in Strategy value for the Term to -5%. Daily Charges are deducted from the Investment Base before the increase for any rise in the Index or decrease for any fall in the Index is applied.
Examples. At the beginning of a Term, you allocate $100,000 to an Indexed Strategy. You do not take any withdrawals during that Term. Changes in the Index over a Term would have the following impact on Strategy Values at the Term End, depending on the Cap or Upside Participation Rate that applies:
(a) | When the Index rises over a Term, the resulting Strategy Value increase will be smaller than the rise in the Index applied to the initial Investment Base. This is because the Daily Charge reduces the Investment Base before the Index rise is taken into account. (Note: this would not apply if the Upside Participation Rate were to exceed 100% to the extent needed to offset the Daily Charge). |
(b) | When the Index falls over a Term, the resulting Strategy Value decrease will be larger than the fall in the Index applied to the initial Investment Base. This is because the Daily Charge reduces the Investment Base before the Index fall is taken into account. |
We set the Caps and Upside Participation Rates for each Indexed Strategy prior to the start of each Term. This means Caps and Upside Participation Rates may change for each Term. A Cap will never be lower than 1%. An Upside Participation Rate will never be less than 5%. At least 10 days before the next Term starts, we will post the Caps and Upside Participation Rates that will apply to the Indexed Strategies for that next Term on our website (www.massmutualascend.com/RILArates).
Any increase in the value of an Indexed Strategy at the end of a Term is based on the value of the underlying Index on the final Market Day of the Term. This means that you may experience negative or flat performance for the Term even though the underlying Index rose throughout some or most of the Term.
For each Term of each Downside Participation Rate Strategy that we currently offer with this Contact, the Downside Participation Rate is 50%. The Downside Participation Rate for these Indexed Strategies will not change. In a hypothetical worst case scenario where the Index falls by 100% over the Term and the Downside Participation Rate is 50%, then the Strategy value at the end of the Term will be equal to the Investment Base decreased by 50% in addition to the impact of the Daily Charges on the Investment Base.
For each Term of the Floor Strategies that we currently offer with this Contract, the Floor is either -10% or 0%. The Floor for a Floor Strategy will not change. In a hypothetical worst case scenario where the Index falls by 100% for the Term and the Floor is -10%, then the Strategy value at the end of the Term will be equal to the Investment Base decreased by 10% in addition to the impact of the Daily Charges on the Investment Base.
For each Term of each Buffer Strategy that we currently offer with this Contract, the Buffer is 10%. The Buffer for these Indexed Strategies will not change. In a hypothetical worst case scenario where the Index falls by 100% over the Term and the Buffer is 10%, then the Strategy value at the end of the Term will be equal to the Investment Base decreased by 90% in addition to the impact of the Daily Charges on the Investment Base.
Indexed Strategy Value Before End of Term (See Indexed Strategy Value Before End of Term section on page [ ] for more details)
Before the end of a Term, unless you have made a Performance Lock election, the value of an Indexed Strategy is equal to the Investment Base increased or decreased by the Daily Value Percentage. If you have made a Performance Lock election, then the normal rules set out here do not apply, and the value before the end of a Term is determined as described under Performance Lock below.
The Daily Value Percentage is intended to determine the value of an Indexed Strategy prior to the end of a Term using option values related to the positive and negative return factors of the Indexed Strategy. The Daily Value Percentage is equal to the Net Option Price, reduced by the Amortized Option Cost and the Trading Cost.
| The Net Option Price is the calculated price of hypothetical options that represent the projected change in the applicable Index over the full Term. The calculated price takes into account the applicable Cap or Upside Participation Rate and the Buffer, Floor, or Downside Participation Rate. |
| The Amortized Option Cost is the calculated price of those options at the start of the Term amortized over the Term. |
| The Trading Cost is the estimated cost of selling those options. It is a percentage set by us by the last Market Close on or before that day. |
For example, if the Investment Base for a Strategy is $100,000 and the Daily Value Percentage is 8%, then the value of your Strategy on that day is equal to $108,000 ($100,000 Investment Base, increased by $100,000 x 8%). If the Investment Base for a Strategy is $100,000 and the Daily Value Percentage is -4%, then the value of your Strategy on that day is equal to $96,000 ($100,000 Investment Base, decreased by $100,000 x -4%).
12
Performance Lock (See Indexed Strategy Value After Performance Lock section on page [ ] for more details)
A Performance Lock is an election to lock in the Daily Value Percentage for the remainder of a Term. You may make a Performance Lock election for a Term by a Request in Good Order. Once we receive your Request in Good Order, a Performance Lock election for a Term cannot be changed or revoked. However, Daily Charges continue to be assessed even after a Performance Lock election. Note: A Performance Lock election is not available for Contracts issued in Missouri.
A Performance Lock election for a Term is effective on the second Market Close following our receipt of your Request in Good Order. After the second Market Close, the Indexed Strategy value before the end of the Term and the Indexed Strategy value at the end of the Term is based on the Daily Value Percentage as determined for that second Market Close. This means that the Net Option Value, Amortized Option Cost, and Trading Cost as of that second Market Close will apply from that date on through the end of the Term.
Performance Lock is only available for an S&P 500 Indexed Strategy or a First Trust Barclays Edge Indexed Strategy.
If you make a Performance Lock election for the S&P 500 6-Year 10% Buffer with Upside Participation Rate Indexed Strategy before the sixth year of the Term, that Term will end on the next anniversary of the Term start date.
You are responsible for deciding whether to elect a Performance Lock and we are not responsible for any losses incurred as a result of your decision whether or not to elect a Performance Lock.
Strategy Renewals and Reallocations (See Strategy Selections at Term End section on page [ ] for more details)
At the end of each Term, you may reallocate the ending values of the Indexed Strategies for that Term among the Strategies.
| If you reallocate, then we will apply the ending values of the Indexed Strategies to a new Term of the Indexed Strategies that you select. |
| If you do not reallocate, then we will apply the ending value of each Indexed Strategy to a new Term of that same Strategy, as long as the same Strategy is available for a new Term. |
| If you do not reallocate and the same Indexed Strategy is not available for a new Term, then we will apply the ending value of that Indexed Strategy to a new Term of the S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy. |
The S&P 500 6-Year 10% Buffer with Upside Participation Rate Strategy is only available for a Term that starts in the first Contract Year. If you do not reallocate, then we will apply the ending value of the S&P 500 6-Year 10% Buffer with Upside Participation Rate Strategy to a new Term of the S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy.
You cannot reallocate your value among Indexed Strategies during a Term. If you elect a Performance Lock, you will not be able to reallocate the locked value until the end of a Term. We will send you written notice at least 30 days before the end of a Term to provide you with the opportunity to make a reallocation. However, you will not know the Cap and Upside Participation Rates applicable to a new Term until 10 days before the end of the current Term. You should consider this information before finalizing your renewal or reallocation decision.
Access to Your Money through Withdrawals (See Cash Benefit section on page [ ] for more details)
You may take a withdrawal from your Contract at any time prior to the Annuity Payout Initiation Date. During the first six Contract Years, an Early Withdrawal Charge will apply unless (a) your withdrawal qualifies for the Free Withdrawal Allowance or (b) the withdrawal qualifies for a waiver (as explained in the Early Withdrawal ChargeEarly Withdrawal Charge Waiver section). A withdrawal from an Indexed Strategy will reduce the Account Value by the amount of the withdrawal, including any taxes and any applicable Early Withdrawal Charge. A withdrawal during a Term will reduce the Investment Base, which is used to calculate subsequent Strategy values for that Term, by an amount that is proportional to the reduction in the Indexed Strategy value due to the withdrawal.
Early Withdrawal Charge (See Early Withdrawal Charge section on page [ ] for more details)
An Early Withdrawal Charge applies during the first six Contract Years if you Surrender your Contract or withdraw an amount in excess of the Free Withdrawal Allowance. The charge is equal to the amount subject to the charge multiplied by the applicable rate set out below.
Contract Year |
1 | 2 | 3 | 4 | 5 | 6 | 7+ | |||||||||||||||||||||
Early Withdrawal Charge Rate |
9 | % | 8 | % | 7 | % | 6 | % | 5 | % | 4 | % | 0 | % |
If you take a withdrawal from your Contract, the amount subject to the charge is the amount you withdraw plus any amount needed to pay the Early Withdrawal Charge. If you Surrender your Contract, the amount subject to the charge is your Account Value.
13
When you request a withdrawal, we will reduce the amount we pay you by the amount of the Early Withdrawal Charge. If you instruct us to pay you the specific withdrawal amount, we will instead reduce your Account Value by both the requested specific withdrawal amount, as well as the amount of the Early Withdrawal Charge. In this case, since you opted not to pay the Early Withdrawal Charge out of your withdrawal proceeds, we treat the Early Withdrawal Charge as an additional requested withdrawal. We will apply the Early Withdrawal Charge to both the specified withdrawal amount, as well as any amounts we withdraw to cover your Early Withdrawal Charges. The Early Withdrawal Charge does not apply to a withdrawal that qualifies for the Free Withdrawal Allowance or the amount, if any, that qualifies for another waiver.
For example, if after using their Free Withdrawal Allowance a contractholder requested that an additional $10,000 be withdrawn from their Account Value when a 9% Early Withdrawal Charge was in effect, a $900 Early Withdrawal Charge would apply (9% of $10,000 withdrawn). The contractholder would receive $9,100 ($10,000 - $900), minus any income tax withholding.
Similarly, if a contractholder instead requested that they receive a net amount of $10,000 from their account in the same circumstances, we would treat the Early Withdrawal Charge amount as an additional requested withdrawal subject to an Early Withdrawal Charge. This means that we will gross up your requested withdrawal to cover applicable Early Withdrawal Charges (and any income tax withholding). If we assume that no income tax withholding applies, the withdrawal would be grossed up to $10,989, calculated by dividing the net amount requested by 1 minus the Early Withdrawal Charge rate ($10,000 / (1 0.09)). The Early Withdrawal Charge would be $989 (9% of the $10,989 withdrawal), and the contractholder would receive $10,000 ($10,989 - $989).
Free Withdrawal Allowance (See Early Withdrawal Charge section on page [ ] for more details)
The Early Withdrawal Charge does not apply to the Free Withdrawal Allowance.
| For the first Contract Year, the Free Withdrawal Allowance is an amount equal to 10% of the total Purchase Payments received by us. |
| For each subsequent Contract Year, the Free Withdrawal Allowance is equal to 10% of the Account Value as of the most recent Contract Anniversary. |
Payout Options (See Payout Options section on page [ ] for more details)
Like all annuity contracts, the Contract offers a range of Payout Options, which provide payments for your lifetime or for a fixed period. After payments begin, you cannot change the Payout Option or any fixed period you selected. The standard Payout Options are listed below.
| Fixed Period Payout |
| Life Payout |
| Life Payout with Payments for at Least a Fixed Period |
| Joint and One-Half Survivor Payout |
Death Benefit (See Death Benefit section on page [ ] for more details)
A Death Benefit is payable under the Contract if you die before the Annuity Payout Initiation Date. If the Owner is a non-natural person, such as a trust or a corporation, then a Death Benefit is payable under the Contract if an Annuitant dies before the Annuity Payout Initiation Date.
The Death Benefit value is the Account Value as of the applicable date.
Tax Deferral (See Federal Tax Considerations section on page [ ] for more details)
The Contract is generally tax deferred, which means that you are not taxed on the earnings in your Contract until the money is paid to you. Contracts owned by non-natural owners, such as trusts and corporations, are subject to special rules.
A tax-qualified retirement plan such as an IRA also provides tax deferral. Buying the Contract within a tax-qualified retirement plan does not give you any extra tax benefits. There should be reasons other than tax deferral for buying the Contract within a tax-qualified retirement plan.
Right to Cancel (See Right to Cancel (Free Look) section on page [ ] for more details)
If you purchase a Contract, you may cancel it within 20 days after you receive it. If you purchase a Contract to replace an existing annuity contract or insurance policy, you have 30 days to cancel the Contract. The right to cancel period may be longer in some states. If you cancel your Contract, you will receive a refund. The amount of the refund will depend on where you live. In some states, the refund amount is equal to the Purchase Payments. In that case, no adjustment will be made for the Daily Value Percentage and no Early Withdrawal Charges will apply to the amount refunded. In other states, the refund amount is equal to the Account Value on the day that we receive a cancellation request. In this case, you would bear the risk of changes in Indexed Strategy values before cancellation because an adjustment will be made for the Daily Value Percentage, but no Early Withdrawal Charges will apply to the amount refunded. Unless required by state law, we do not refund any Daily Charge assessed during the free look period or any Early Withdrawal Charges assessed during the free look period that relate to a withdrawal taken before you cancel the Contract. See the Right to Cancel (Free Look) section for more information about your cancellation rights and the State Variations section of this prospectus for more information about state variations that apply to cancellation rights.
14
There may be tax consequences if you cancel the Contract. You should seek advice on tax questions based on your particular circumstances from a tax advisor.
The Contract involves certain risks that you should understand before purchasing it. You should carefully consider your income needs and risk tolerance to determine whether the Contract or a particular Indexed Strategy is appropriate for you. The level of risk you bear and your potential investment performance will differ depending on the Indexed Strategies you choose.
Loss of Principal Related to Indexed Strategies
There is a significant risk of loss of principal and prior earnings due to the fall of an Index if you allocate your Purchase Payment(s) to an Indexed Strategy. Such a loss may be substantial. This risk exists because, at the end of that Term, you can lose up to 10% of the money allocated to a -10% Floor Strategy, 90% of the money allocated to a Buffer Strategy or 50% of the money allocated to any other Indexed Strategy. In addition, before the end of a Term, the value of a Strategy may be even less than 50% of the money allocated to that Indexed Strategy with a Downside Participation Rate, or even less than 90% of the money allocated to a -10% Floor Strategy, or even less than 10% for money allocated to the Buffer Strategy because the loss will include a reduction for the Amortized Option Cost and the Trading Cost. If you allocate money to one or more Indexed Strategies over multiple Terms, you may lose money each Term, which may result in a cumulative loss that is greater than 50% for an Indexed Strategy with a Downside Participation Rate, greater than 10% for a -10% Floor Strategy, or greater than 90% for a Buffer Strategy of your Purchase Payment(s).
The S&P 500 1-Year 50% Downside Participation Rate with Upside Participation Rate Indexed Strategy will always be available. At the end of a Term, we may stop offering any other Indexed Strategy. Consequently, any other Indexed Strategy listed in this prospectus may not be available after the end of the initial Term. The S&P 500 6-Year 10% Buffer with Upside Participation Rate Indexed Strategy will only be available for Terms beginning in the first Contract Year. We have the right to replace the Index associated with an Indexed Strategy under certain circumstances.
In the future, we may offer a new Strategy with a Downside Participation Rate that is more or less than 50%, a Floor that is more or less negative than -10%, or with a Buffer of more or less than 10%. The risk of loss of principal will be greater if you allocate money to a Strategy with a higher Downside Participation Rate, more negative Floors or less of a Buffer. In a worst case scenario, if we could eliminate all of the current Indexed Strategies and offer only new Indexed Strategies with higher Downside Participation Rates or lesser Buffers, then your risk of loss of principal would increase.
Loss of Principal Related to Daily Charge
There is a risk of loss of principal and related earnings as a result of the Daily Charge. The Daily Charge reduces your Investment Base, which will result in reduced Strategy values. In addition, any Index increases will not apply to amounts deducted as Daily Charges because Daily Charges are subtracted from the Investment Base prior to calculating Strategy values. The Daily Charge will continue to be assessed against your Investment Base even if you have made a Performance Lock election.
You could realize losses even when the Index rises. This will occur when the amount of increase attributable to an Index rise is smaller than the amount needed to offset the Daily Charge.
For example, if the Investment Base of an Indexed Strategy at the start of a Term is $100,000 and $650 in Daily Charges have been deducted since the start of the Term, the remaining Investment Base will be $99,350 ($100,000 $650). If on that date the Daily Value Percentage is a positive 0.5%, then the Strategy Value on that date will be $99,847 ($99,350 x 100.5%). The Daily Charges exceed the value attributable to the 0.5% increase, resulting in a net reduction in the Strategy Value since the start of the Term. In addition, the 0.5% increase will not apply to the $650 applied to pay the Daily Charges because the Daily Charges are subtracted from the Investment Base before calculating the Strategy value.
When the Index falls, the Daily Charge will cause you to realize losses in excess of the Downside Participation Rate.
Loss of Principal Related to Early Withdrawal Charge
There is also a risk of loss of principal and prior earnings if you take a withdrawal from your Contract or Surrender it during the first six Contract Years and an Early Withdrawal Charge applies. This risk exists for each Strategy. An Early Withdrawal Charge will reduce the value of the Strategy. This reduction may exceed any prior earnings.
15
Long-Term Nature of Contract
The Contract is a deferred annuity, which means the Annuity Payout Benefit will begin on a future date. We designed the Contract to be a long-term investment that you can use to help build a retirement nest egg and provide income for retirement. The limitations, adjustments and charges included in the Contract reflect its long-term nature.
Limits on Strategy Value at End of Term
If the Index rises over the Term and a Cap applies, then the Strategy value at the end of the Term can never be more than the Investment Base increased by the Cap for that Term even if the Index has risen by more than the Cap. If the Index rises over the Term and an Upside Participation Rate applies, then the Strategy value at the end of the Term will be the Investment Base increased by your share of the rise in the Index. Your share of any rise in the Index is equal to the Upside Participation Rate for that Term multiplied by the rise in the Index. Due to these limitations, in many cases the return on money allocated to an Indexed Strategy with a Cap will not fully reflect the corresponding rise in the Index over the Term and the return on money allocated to an Indexed Strategy with an Upside Participation Rate that is less than 100% will never reflect the entire corresponding rise in the Index over the Term.
Index Changes Over the Course of Term
At the end of a Term, unless you have made a Performance Lock election, we measure the Index change by comparing the Index value on the first day of the Term to the Index value on the last day of the Term. This means that if the Index value is lower on the last day of the Term, you may experience negative or flat performance even if the Index rose through some, or most, of the Term.
The Contract offers you the opportunity to allocate funds to Indexed Strategies for one year, two year, or six year Terms. For Indexed Strategies with two-year Terms or six year Terms, changes in Strategy value as a result of Index performance will only be measured over a two year period or a six year period and not annually.
Limits on Strategy Value Before End of Term
Before the end of a Term, we calculate the value of an Indexed Strategy using a Daily Value Percentage that is not tied directly to the underlying Index. The Daily Value Percentage includes the prices of hypothetical options. Such option prices will vary from day to day. You will bear the risk that the Daily Value Percentage may decrease the Strategy value before the end of a Term.
The Daily Value Percentage includes deductions for the Amortized Option Cost and the Trading Cost, which means that any Strategy value before the end of a Term will almost always be less than the value suggested by the rise or fall of the Index. Because the Amortized Option Cost is a decreasing value, its negative impact on Strategy values will be more pronounced at the start of a Term than at the end of that Term. In addition, even if the Index rises, the Strategy value may be less than the Investment Base due to these deductions.
Strategy values are used to calculate the amount payable upon Surrender, applied to the Annuity Payout Benefit, or payable as the Death Benefit. Accordingly, the Amortized Option Cost and Trading Cost will have a negative effect on such benefits taken before the end of a Term.
For more information on how we determine the prices of hypothetical options, see the Option Prices section of this Prospectus.
No Increases in Value After Performance Lock
If you make a Performance Lock election, the Daily Value Percentage will be locked for the balance of the Term. This means that you will experience flat performance through the balance of the Term even if the Net Option Value increases, you will not benefit from the continued decline in the Amortized Option Cost, your Strategy value will continue to be reduced to reflect the Daily Charge, and your ending Strategy value will not be based on the ending Index value on the last day of the Term.
Limits on Reallocations
You cannot reallocate money among the Indexed Strategies prior to the end of a Term. If you want to take money out of an Indexed Strategy during a Term, you must take a withdrawal or Surrender your Contract.
Effect of Surrenders
If you Surrender your Contract at any time during the first six Contract Years and an Early Withdrawal Charge applies, the amount payable will reflect a deduction for the charge. If you Surrender your Contract at the end of a Term, the amount payable will reflect any rise or fall of the applicable Indexes over the Term, applicable Caps, Upside Participation Rates, Floors, Buffers and the Downside Participation Rate. If you Surrender your Contract before the end of a Term, the amount payable will reflect the applicable Daily Value Percentage.
16
Effect of All Withdrawals
If you take a withdrawal at any time, we will reduce your Account Value by an amount equal to your withdrawal. If you take a withdrawal during the first six Contract Years and an Early Withdrawal Charge applies, we will also reduce your Account Value by the amount of the charge. A reduction in the Account Value will reduce the amount payable upon Surrender, applied to the Annuity Payout Benefit, or payable as the Death Benefit. In addition, a withdrawal will proportionally reduce the Return of Premium Guarantee for the Death Benefit.
Each withdrawal from an Indexed Strategy, including withdrawals available under the Free Withdrawal Allowance, withdrawals that qualify for a waiver of the Early Withdrawal Charge, withdrawals under an automatic withdrawal program and withdrawals to satisfy a required distribution, will reduce the Strategy value. If taken from an Indexed Strategy before the end of a Term, the reduction in Strategy value is determined by the Daily Value Percentage on the date of the withdrawal, or on the locked Daily Value Percentage if you have made a Performance Lock election. The reduction in Strategy value may be higher or lower than the Investment Base. Unless you have made a Performance Lock election, the reduction in Strategy value may be higher or lower than the end-of-Term value. The Investment Base used to calculate the Strategy value through the end of that Term will also be reduced. The reduction in the Investment Base for a withdrawal and any related Early Withdrawal Charge is proportional to the reduction in the Strategy value. A reduction in the Investment Base will limit the effect of any rise or fall in the Index for the remainder of the Term.
All or some portion of a withdrawal may be subject to federal and state income taxes and, if taken before age 591/2, may be subject to a 10% federal penalty tax. For a further discussion of the tax treatment of withdrawals and surrenders, please see the Federal Tax Considerations section on page [ ].
Timing and Effect of Withdrawals Before End of Term
You should take into consideration the dates on which the Term(s) of your Indexed Strategies end relative to the timing of a withdrawal.
| If you take a withdrawal from an Indexed Strategy before the end of a Term, we will immediately reduce the Investment Base for that Indexed Strategy. |
| The reduction will be proportional to the reduction in the Strategy Value, which means that the proportional reduction in the Investment Base could be larger than the dollar amount of the withdrawal. |
| Reductions to the Investment Base will have a negative effect on any increases in the Indexed Strategy value for the remainder of that Term, but will reduce any decreases in the Indexed Strategy value for the remainder of that Term. |
| Once the Investment Base for an Indexed Strategy is reduced due to a withdrawal before the end of a Term, it will not increase at any time during the remainder of that Term. |
Each withdrawal from an Indexed Strategy before the end of a Term, including withdrawals available under the Free Withdrawal Allowance, withdrawals that qualify for a waiver of the Early Withdrawal Charge, withdrawals under an automatic withdrawal program and withdrawals to satisfy a required distribution, will proportionally reduce the Investment Base.
No Ability to Determine Contract Values in Advance
We will process any withdrawal request at the first Market Close after receipt of your Request in Good Order. This means you will not be able to determine in advance the amount of the proportional reduction in the Investment Base due to the withdrawal. Likewise, you will not be able to determine in advance the amount payable upon Surrender, to be applied to the Annuity Payout Benefit or payable as the Death Benefit.
A Performance Lock election is effective on the second Market Close after receipt of your Request in Good Order. This means you will not be able to determine in advance the locked Daily Value Percentage that will be applicable to the Indexed Strategy at the time you make a Performance Lock election. The Daily Value Percentage may be higher or lower at the time the Performance Lock election goes effective than it was when you submitted your Request in Good Order. Note: A Performance Lock election is not available for Contracts issued in Missouri.
Changes in Caps, Upside Participation Rates, and Trading Cost
We set a Cap or an Upside Participation Rate for each new Term of an Indexed Strategy. The Cap or Upside Participation Rate for a new Term of an Indexed Strategy may be lower than its Cap or Upside Participation Rate for the current Term. A Cap may be as low as 1%. An Upside Participation Rate may be as low as 5%. You risk the possibility that the Cap or Upside Participation Rate for a new Term may be lower than you would find acceptable.
We may change the Trading Cost at any time due to changes in option prices. You bear the risk of any negative effect on the Daily Value Percentage and Indexed Strategy values of an increase in the Trading Cost.
17
Unavailable Indexed Strategies
At the end of a Term, we may stop offering any Indexed Strategy other than the S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate Indexed Strategy. Consequently, any other Indexed Strategy you selected may not be available after the end of a Term. In such an event, the Company will amend the prospectus. At least 30 days before the end of each Term, we will send you a written notice with information about the Indexed Strategies that will be available for the next Term. If funds are allocated to an Indexed Strategy that will not be available for the next Term and you do not request a reallocation of those funds, then we will apply the ending value of that Indexed Strategy for the next term as follows:
1) | if the Strategy is a Downside Participation Rate Strategy, to another Indexed Strategy that uses the same index as the prior Indexed Strategy, has a Term that is no longer than the prior Indexed Strategy, has a Downside Participation Rate that is no greater than the prior Indexed Strategy, and has the same or most comparable positive return factors; or |
2) | if the Strategy is a Floor Strategy, to another Indexed Strategy that uses the same index as the prior Indexed Strategy, has a Term that is no longer than the prior Indexed Strategy, has a Floor that is no more negative than the prior Indexed Strategy, and has the same or most comparable positive return factors; or |
3) | if the Strategy is a Buffer Strategy, to another Indexed Strategy that uses the same index as the prior Indexed Strategy, has a Term that is no longer than the prior Indexed Strategy, has a Buffer that is at least as large as the prior Indexed Strategy, and has the same or most comparable positive return factors; or |
4) | to the S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate Indexed Strategy. |
We may establish minimum and maximum amounts or percentages that may be applied to a given Indexed Strategy. This means that an Indexed Strategy you selected may not be available after the end of a Term because the amount to be applied to that Strategy is less than the minimum we set for the new Term. Likewise, the amount to be applied to an Indexed Strategy may be limited by the maximum we set for the new Term. At least 30 days before the end of each Term, we will send you a written notice with information about any maximum or minimum that will apply for the next Term. If funds cannot be applied to a Strategy due to the minimum or maximum we set for the next Term and you do not request a reallocation of those funds, we will apply the funds for the new Term in the same manner as if the given Indexed Strategy were no longer offered.
In these cases, the funds that we allocate to the default Strategy may earn a return that is lower than the return those funds would have earned if they had been applied to the Indexed Strategy you selected.
If you choose to Surrender your Contract because a certain Indexed Strategy is no longer available, you may be subject to an Early Withdrawal Charge. There may be tax consequences if you Surrender your Contract. You should seek advice on tax questions based on your particular circumstances from a tax advisor.
The S&P 500 6-year 10% Buffer with Upside Participation Rate Strategy is not available for Terms that begin after the first Contract Year.
Replacement of an Index
We have the right to replace an Index if: it is discontinued: we are no longer able to use it, its calculation changes substantially, or we determine that hedging instruments are difficult to acquire or the cost of hedging becomes excessive. We may do so at the end of a Term or during a Term. If we replace an Index, notice will be provided to contract owners and the Company will amend the prospectus. If we replace an Index during a Term, we will calculate any rise or fall in the Index using the old Index up until the replacement date. After the replacement date, we will calculate any rise or fall in the Index using the new Index. The performance of the new Index may not be as good as the performance of the old Index. As a result, funds allocated to an Indexed Strategy may earn a return that is lower than the return they would have earned if there had been no replacement.
Involuntary Termination of Contract
If your Account Value on any anniversary of the initial Strategy Application Date is below the minimum value of $5,000 for any reason, we may terminate your Contract on that anniversary. If your Contract has Terms that end on the same date because you made only one Purchase Payment, any involuntary termination will occur on that date. If your Contract has Terms that end on different dates because you made more than one Purchase Payment, any involuntary termination will occur on one of those dates, which will be the end of one Term but not the end of the other Terms. In this case, the Surrender Value payable upon termination of your Contract will reflect the Daily Value Percentages used to calculate the values of Indexed Strategies with Terms that are not ending on the termination date.
No Direct Investment in S&P 500 Index
When you allocate money to an Indexed Strategy that uses the S&P 500 Index, you will not be investing in that Index, or in any stock included in that Index. The S&P 500 Index is calculated without taking into account dividends paid on stocks that make up the S&P 500 Index. In addition, because the performance of an S&P 500 Indexed Strategy is linked to the performance of the S&P 500 Index and not the performance of the stocks included in the Index, your return may be less than that of a direct investment in such stocks. In addition, due to the same limitations, your return may be less than that of a direct investment in a fund that tracks the S&P 500 Index.
No Direct Investment in an iShares ETF
When you allocate money to an Indexed Strategy that uses the iShares MSCI EAFE ETF or iShares U.S. Real Estate ETF, you will not be investing in that exchange-traded fund, the securities or other assets held by the fund, in any underlying index tracked by the fund, or in the securities or other assets held by such underlying index. In addition, because the performance of an iShares ETF is linked to the performance of the share price of the ETF, which is determined by trading on the exchange, and not the performance of its investment portfolio, its underlying index or the components of that index, your return may be less than that of a direct investment in the securities or other assets held by the fund or a direct investment in the components of the funds underlying index. In addition, due to the same limitations, your return may be less than that of a direct investment in the fund.
18
No Direct Investment in SPDR Gold Shares ETF
When you allocate money to an Indexed Strategy that uses the SPDR Gold Shares ETF, you will not be investing in that exchange-traded fund or in gold. In addition, because the performance of the SPDR Gold Shares ETF is linked to the performance of the share price of the ETF, which is determined by trading on the exchange, and not the performance of its investment portfolio, its underlying index or the components of that index, your return may be less than that of a direct investment in the securities or other assets held by the fund or a direct investment in the components of the funds underlying index. In addition, due to the same limitations, your return may be less than that of a direct investment in the fund.
No Direct Investment in First Trust Barclays Edge Index
When you allocate money to an Indexed Strategy that uses the First Trust Barclays Edge Index, you will not be investing in that Index, or in any stock or bonds included in that Index. The First Trust Barclays Edge Index is calculated assuming that dividends paid on stocks that make up the First Trust Barclays Edge Index are reinvested. In addition, because the performance of the First Trust Barclays Edge Indexed Strategy is linked to the performance of the First Trust Barclays Edge Index and not the performance of the stocks and bonds included in the Index, your return may be less than that of a direct investment in such stocks and bonds. In addition, due to the same limitations, your return may be less than that of a direct investment in a fund that tracks the First Trust Barclays Edge Index.
Divergence of Performance
The performance of an Indexed Strategy will diverge from the performance of the underlying Index because changes in the value of an Indexed Strategy at the end of a Term are subject to Caps or Upside Participation Rates and the Downside Participation Rate or Buffer, and because changes in the value of an Indexed Strategy before the end of a Term are based on the Daily Value Percentage.
Market Risk Related to Indexes
Money allocated to an Indexed Strategy that uses the S&P 500 Index or the First Trust Barclays Edge Index is subject to the risk that the market value of the underlying securities that comprise the S&P 500 Index and the First Trust Barclays Edge Index may decline over a Term. Likewise, money allocated to an Indexed Strategy that uses the iShares MSCI EAFE ETF, the iShares U.S. Real Estate ETF, or the SPDR Gold Shares ETF is subject to the risk that the funds share price may decline over a Term. The level of the S&P 500 Index and the First Trust Barclays Edge Index and the share prices of the SPDR Gold Shares ETF, iShares MSCI EAFE ETF and the iShares U.S. Real Estate ETF may be volatile. Any such market loss in an amount up to the Downside Participation Rate will be reflected in the Indexed Strategy value. For example, with a Downside Participation Rate of 50%, the Indexed Strategy value will be reduced by 50% of a fall in the Index at the end of a Term. This risk applies even if you do not take a withdrawal before the end of a Term. For a Buffer Strategy, the Indexed Strategy value will be reduced by any amount by which the fall in the Index at the end of the Term exceeds the 10% Buffer. For a Floor Strategy with a floor of -10%, the Indexed Strategy value will be reduced at the end of the Term by the fall in the Index, not to exceed -10%. This risk also applies even if you do not take a withdrawal before the end of a Term.
[The outbreak of the novel coronavirus known as COVID-19 has led to significant volatility in the financial markets. These market conditions have impacted the performance of the Indexes to which the Indexed Strategies are linked. If these market conditions continue, and depending on your individual circumstances (e.g., your selected Crediting Strategies and the timing of any Purchase Payments, transfers, or withdrawals), you may experience (perhaps significant) negative returns under the Contract. The future impact that the pandemic may have on the financial markets and global economy, cannot be foreseen, however. You should consult with a Financial Professional about how the COVID-19 pandemic and the recent market conditions may impact your future investment decisions related to the Contract, such as purchasing the Contract or making Purchase Payments, transfers, or withdrawals, based on your individual circumstances.
The Russian/Ukraine conflict and the resulting response by the United States and other countries could create economic disruption, including increased market volatility, and presents economic uncertainty. The full impact and duration of these events are difficult to determine. Any such impact could adversely affect the performance of the securities that comprise the Indexes and may lead to losses on your investment in the Indexed Strategies.]
The historical performance of an Index does not guarantee future results.
S&P 500 Index. The S&P 500® Index is designed to reflect the large-cap sector of the U.S. equity market and, due to its composition, it also represents the U.S. equity market in general. Any positive change in the S&P 500 Index over a Term will be lower than the total return on an investment in the stocks that comprise the S&P 500 Index because such total return will reflect dividend payments on those stocks and the S&P 500 Index will not reflect those dividend payments. More information about the S&P 500 Index is set out in the Indexes section of this prospectus.
19
iShares MSCI EAFE ETF. The iShares MSCI EAFE ETF is an exchange traded fund that seeks to track the investment results of an index composed of large- and mid-capitalization developed market equities, excluding the U.S. and Canada (MSCI EAFE Index). This underlying index includes stocks from Europe, Australasia and the Far East. It may include large- or mid-capitalization companies. The share price of the iShares MSCI EAFE ETF is tied to the performance of large- and mid-capitalization developed market equites, excluding the U.S. and Canada. The share price may not replicate the performance of the fund, its underlying index, or the components of that index. More information about the iShares MSCI EAFE ETF is set out in the Indexes section of this prospectus. To learn more about the iShares MSCI EAFE ETF, visit iShares.com and search ticker symbol EFA.
iShares U.S. Real Estate ETF. The iShares U.S. Real Estate ETF is an exchange traded fund that seeks to track the investment results of an index composed of U.S. equities in the real estate sector (Dow Jones U.S. Real Estate Index). This underlying index may include large-, mid- or small-capitalization companies. A significant portion of the underlying index is represented by real estate investment trusts (REITs), but the components are likely to change over time. The share price of the iShares U.S. Real Estate ETF is tied to the performance of the real estate sector. The share price may not replicate the performance of the fund, its underlying index, or the components of that index. More information about the iShares U.S. Real Estate ETF is set out in the Indexes section of this prospectus. To learn more about the iShares U.S. Real Estate ETF, visit iShares.com and search ticker symbol IYR.
SPDR Gold Shares ETF. The SPDR Gold Shares ETF represents units of beneficial interest in, and ownership of, the SPDR Gold Trust, an exchange traded fund that holds gold bullion. The investment objective of the trust is for the shares to reflect the performance of the price of gold bullion, less the trusts expenses. The shares are designed to mirror as closely as possible the price of gold, and the value of the shares relates directly to the value of the gold held by the trust, less its liabilities. The price of gold has fluctuated widely over the past several years and the shares have experienced significant price fluctuations. The value of the gold held by the trust is determined using the London Bullion Market Association (LBMA) Gold Price PM. The Gold Shares trade on the NYSE Arca under the symbol GLD. For more information, visit www.spdrgoldshares.com.
First Trust Barclays Edge Index. The First Trust Barclays Edge Index is designed to combine capital strength and value equity investment methodologies with a mix of US Treasuries for more consistent returns. The First Trust Barclays Edge Index consists of an equity component that combines stocks from the Capital Strength Index and the Value Line Dividend Index. The Capital Strength Index starts with the largest 500 companies in the NASDAQ US benchmark index and then reduces the selection universe by screening for companies that meet minimum criteria including cash and/or short-term investments on their balance sheets, low debt-to-market cap ratios and attractive return-on-equity. It then selects the top 50 names from this smaller universe based on low historical volatility. The Value Line Dividend Index starts with the universe of stocks published in its The Value Line Investment Survey publication and then selects those with a Value Line Safety Rank of 1 or 2, with attractive dividends and market cap of one billion dollars or above. It then equally weights all stocks that meet those conditions (generally, around 160-200 stocks). The First Trust Barclays Edge Index then combines the stocks represented in The Capital Strength Index and the Value Line Dividend Index. The Index also monitors various market factors to determine if an allocation to 2-year, 5-year and 10-year US Treasuries is warranted with a daily volatility control to target a 7% volatility level per annum.
Market Risk Related to Option Prices
Before the end of a Term, money allocated to an Indexed Strategy is subject to the risk that changes in the related option prices may have a negative effect on the value of the Indexed Strategy. This risk applies only if you take a withdrawal before the end of a Term.
Performance Lock Risk
If you make a Performance Lock election, you will no longer participate in the positive or negative performance of the Index over the remainder of the Term. This means the value of the Indexed Strategy cannot increase for the remainder of the Term, even if the Index rises over the remainder of the Term.
A Performance Lock election is effective on the second Market Close after receipt of your Request in Good Order. This means you will not be able to determine in advance the Gain or Loss applicable to the Indexed Strategy when electing a Performance Lock. The Gain or Loss may be higher or lower at the time the Performance Lock election goes effective than it was when you submitted your Request in Good Order. Note: A Performance Lock election is not available for Contracts issued in Missouri.
Regulatory Risk
MassMutual Ascend Life is not an investment company. Neither MassMutual Ascend Life nor the separate account that we established in connection with the Contracts is registered as an investment company under the Investment Company Act of 1940. The protections provided to investors by that Act are not applicable to the Contract.
Reliance on Our Claims-Paying Ability
No company other than MassMutual Ascend Life has any legal responsibility to pay amounts owed under the Contract. You should look to the financial strength of MassMutual Ascend Life for its claims-paying ability.
20
Our general account assets fund the guarantees provided in the Contracts. The assets are subject to our general business operation liabilities and claims of our creditors and may lose value. We established a non-unitized separate account for the purpose of supporting our obligation to adjust the Indexed Strategy values based on the Daily Value Percentage or rise or fall of the Index. The assets in the non-unitized separate account are not chargeable with liabilities arising out of any other business that we conduct but may lose value. The non-unitized separate account differs from the unitized separate accounts that support our variable annuity contracts. As a result, unlike the owner of a traditional variable annuity who has a beneficial interest in, and participates in the performance of, the assets of the related unitized separate account, you do not have any interest in or claim on the assets in the non-unitized separate account and you will not participate in any way in the performance of assets held in that account. Various factors, such as those listed below, could materially affect our business, financial condition, cash flows or future results and, in turn, our financial strength and claims-paying ability. A more complete discussion of these factors appears on pages [A6-A10].
| Financial losses including those resulting from the following events: |
| Adverse developments in financial markets and deterioration in global economic conditions |
| Unfavorable interest rate environments |
| Losses on our investment portfolio |
| Loss of market share due to intense competition |
| Ineffectiveness of risk management policies |
| Changes in applicable law and regulations |
| Inability to obtain or collect on reinsurance |
| A downgrade or potential downgrade in our financial strength ratings |
| Variations from actual experience and managements estimates and assumptions that could result in inadequate reserves |
| Significant variations in the amount of capital we must hold to meet statutory capital requirements |
| Legal actions and regulatory proceedings |
| Difficulties with technology or data security |
| Failure to protect confidentiality of customer information |
| Failure to maintain effective and efficient information systems |
| Occurrence of catastrophic events, terrorism or military actions |
[The economic impacts of the COVID-19 pandemic may negatively affect our financial condition and results of operations. The extent to which the COVID-19 pandemic impacts financial markets, the global economy, and our financial strength and claims-paying ability will depend on future developments that cannot be predicted with certainty. We continue to be subject to significant state solvency regulations that require us to reserve amounts to pay our contractual guarantees. Please see Managements Discussion and Analysis of Financial Condition and Results of Operations, Risks Primarily Related to MMALICs Financial Strength and Claims-Paying Ability, and Financial Statements, and Regulation for additional financial information about the company and the state solvency regulations to which we are subject.]
The Indexed Strategies provide returns that are based, in part, upon changes in an Index. The Indexed Strategies do not earn interest at a fixed rate. Unlike a traditional variable annuity, the values of the Indexed Strategies are not based on the investment performance of underlying portfolios.
At the end of a Term, unless you have made a Performance Lock election, any increase in the value of an Indexed Strategy is determined after Daily Charges have been deducted from the Investment Base, and is based on the rise in the applicable Index since the start of that Term and the Cap or Upside Participation Rate for that Term. At the end of a Term, any decrease in the value of an Indexed Strategy is determined after Daily Charges have been deducted from the Investment Base, and is based on the fall in the applicable Index since the start of that Term and the Downside Participation Rate or Buffer.
Before the end of a Term, unless you have made a Performance Lock election, the value of an Indexed Strategy is first decreased by Daily Charges. Then any increase or further decrease in the value of an Indexed Strategy is based on the calculated price of hypothetical options related to the possible future change in the applicable Index over the Term, the initial cost of those options, and the trading cost related to those options. The calculated price of those options takes into account the Cap or the Upside Participation Rate for the Term and the Downside Participation Rate or the Buffer.
If you have made a Performance Lock election, then beginning at the second Market Close following receipt of your election and continuing through the end of the Term, any increase or decrease in the value of an Indexed Strategy is locked in based on the calculated price of hypothetical options related to the possible future change in the applicable Index over the Term, the initial cost of those options, and the trading cost related to those options, all as determined at that second Market Close. However, the value of the Indexed Strategy will continue to change because of the Daily Charges assessed against the Investment Base. Note: A Performance Lock election is not available for Contracts issued in Missouri.
21
Each Indexed Strategy has a Cap or an Upside Participation Rate for each Term. We will set a new Cap or Upside Participation Rate for each Indexed Strategy prior to the start of each Term.
The Downside Participation Rate, Floor or Buffer for a Strategy will not change from Term to Term. For each Term of each Indexed Strategy with a Downside Participation Rate that we currently offer, the Downside Participation Rate is 50%. For each Term of an Indexed Strategy with a Buffer that we currently offer, the Buffer is 10%. For each Term of the Indexed Strategies with a Floor that we currently offer, the Floor is -10% or 0%.
Each Term it is possible for you to lose a portion of the money you allocated to any Indexed Strategy.
Available Indexed Strategies
For this Contract, we currently offer fifteen Indexed Strategies. Each of these Indexed Strategies uses one of five Indexes: S&P 500® Index, iShares® MSCI EAFE ETF, iShares® U.S. Real Estate ETF, SPDR Gold Shares ETF, and First Trust Barclays Edge Index. Twelve of these Indexed Strategies have one-year Terms, two have two-year Terms, and one has a six-year Term.
Strategy |
Index | Term | Negative Return Factor | Positive Return Factor | ||||
S&P 500 1-year 50% Downside Participation Rate with Cap |
S&P 500® | 1-year | 50% Downside Participation Rate |
Cap | ||||
S&P 500 2-year 50% Downside Participation Rate with Cap |
S&P 500® | 2-year | 50% Downside Participation Rate |
Cap | ||||
S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate |
S&P 500® | 1-year | 50% Downside Participation Rate |
Upside Participation Rate | ||||
S&P 500 2-year 50% Downside Participation Rate with Upside Participation Rate |
S&P 500® | 2-year | 50% Downside Participation Rate |
Upside Participation Rate | ||||
S&P 500 6-year 10% Buffer with Upside Participation Rate |
S&P 500® | 6-year | 10% Buffer | Upside Participation Rate | ||||
S&P 500 1-year 10% Buffer with Cap |
S&P 500® | 1-year | 10% Buffer | Cap | ||||
S&P 500 1-year -10% Floor with Cap |
S&P 500® | 1-year | -10% Floor | Cap | ||||
S&P 500 1-year 0% Floor with Cap* |
S&P 500® | 1-year | 0% Floor | Cap | ||||
iShares MSCI EAFE ETF 1-year 50% Downside Participation Rate with Upside Participation Rate |
MSCI EAFE ETF | 1-year | 50% Downside Participation Rate |
Upside Participation Rate | ||||
iShares U.S. Real Estate ETF 1-year 50% Downside Participation Rate with Upside Participation Rate |
U.S. Real Estate ETF |
1-year | 50% Downside Participation Rate |
Upside Participation Rate | ||||
iShares U.S. Real Estate ETF 1-year -10% Floor with Cap |
U.S. Real Estate ETF |
1-year | -10% Floor | Cap | ||||
SPDR Gold Shares ETF 1-year -10% Floor with Cap |
SPDR Gold Shares ETF |
1-year | -10% Floor | Cap | ||||
First Trust Barclays Edge 1-year 50% Downside Participation Rate with Upside Participation Rate* |
First Trust Barclays Edge |
1-year | 50% Downside Participation Rate |
Upside Participation Rate | ||||
First Trust Barclays Edge 1-year 10% Buffer with Upside Participation Rate* |
First Trust Barclays Edge |
1-year | 10% Buffer | Upside Participation Rate |
* | The S&P 500 1-year 0% Floor with Cap Strategy and the First Trust Barclays Edge Strategies are not available for Contracts issued in Missouri. |
22
Contractowners who purchased the Contract before May 1, 2023, may have allocated funds to two additional Indexed Strategies. These two Indexed Strategies have been discontinued. They are not available for new or existing contractowners for any new Term that begins after May 1, 2023:
Discontinued Strategy |
Index | Term | Negative Return Factor | Positive Return Factor | ||||
iShares MSCI EAFE ETF 2-year Term with Participation Rate |
MSCI EAFE ETF | 2-year | 50% Downside Participation Rate |
Upside Participation Rate | ||||
iShares U.S. Real Estate ETF 2-year Term with Participation Rate |
U.S. Real Estate ETF |
2-year | 50% Downside Participation Rate |
Upside Participation Rate |
For existing contractowners, at the end of the current Term, any funds in one of these discontinued Indexed Strategies will be transferred to the 1-year 50% Downside Participation Rate with Upside Participation Rate Indexed Strategy that uses the same Index unless the contractowner elects otherwise.
Considerations in Choosing an Indexed Strategy
When choosing among Indexed Strategies, you should consider the characteristics and risk profiles of the Indexes, which are discussed in the Indexes section of this prospectus. You should also consider Term lengths. It is generally more difficult to predict Index performance over a longer Term. In addition, you cannot reallocate funds among Strategies before the end of a Term, and the only way to exit a Strategy before the end of a Term is to take a withdrawal or Surrender your Contract.
When choosing among Indexed Strategies that use the same Index, you should also consider how the Caps and Participation Rates may affect the potential return.
| An Indexed Strategy with Cap provides you with the opportunity to participate in any rise in the Index up to the Cap (after Daily Charges have been deducted from the Investment Base), but you will not participate in any rise in the Index in excess of the Cap. |
| An Indexed Strategy with an Upside Participation Rate provides you with the opportunity to share in any rise in the Index without a Cap, but your share of any rise is always expected to be less than 100%. |
If we assume the Upside Participation Rate is less than 100%, here is how an Indexed Strategy with Cap will perform in comparison to an Indexed Strategy with Participation Rate.
| In any Term where the rise in the Index is less than the Cap, the Cap Strategy will always perform better than the corresponding Upside Participation Rate Strategy. |
| In any Term where the rise in the Index is more than the Cap, but less than the Cap divided by the Upside Participation Rate, the Cap Strategy will always perform better than the corresponding Upside Participation Rate Strategy. |
| In any Term where the rise in the Index is more than the Cap divided by the Upside Participation Rate, the Upside Participation Rate Strategy will always perform better than the Cap Strategy. |
| In any Term where the Index falls, the Cap Strategy and Upside Participation Rate Strategy will produce the same results at the end of the Term if they have the same downside protection. However, before the end of the Term, due to different option pricing, they may have different Daily Value Percentages and returns. |
Examples. These examples are intended to help you understand the interplay between Caps and Upside Participation Rates for Indexed Strategies with similar Terms in different market environments and how this interplay affects the comparative performance of Indexed Strategies that use the same Index. The example assumes that both strategies have downside protection in the form of a 50% Downside Participation Rate.
Index rise |
Return at end of Term | |||||
12% Cap | 75% Upside Participation Rate |
Explanation | ||||
4% | 4% | 3% | The Cap Strategy has a better return than the Upside Participation Rate Strategy because the 4% rise in the Index is less than the 12% Cap. | |||
14% | 12% | 10.5% | The Cap Strategy has a better return than the Upside Participation Rate Strategy because the 14% rise in the Index is more than the 12% Cap, but less than 16% (the 12% Cap divided by the 75% Upside Participation Rate). | |||
16% | 12% | 12% | Both Strategies have the same positive return because the rise in the Index is equal to 16% (the 12% Cap divided by the 75% Upside Participation Rate). | |||
20% | 12% | 15% | The Upside Participation Rate Strategy has a better return than the Cap Strategy because the 20% rise in the Index is more than 16% (the 12% Cap divided by the 75% Upside Participation Rate) | |||
-30% | -15% | -15% | Both Strategies have the same negative return. |
23
See the Examples: Impact of Withdrawals on Contract Values and Amounts Realized section below for more information about the interplay between Caps and Upside Participation Rates for Indexed Strategies with different Terms in different market environments,
Term
Each Term of an Indexed Strategy will start and end on a Strategy Application Date. Each Term is either one year long, two years long, or six years long. A new Term will start at the end of the preceding Term.
If you make only one Purchase Payment or you make all of your Purchase Payments before the initial Strategy Application Date, then each Term of each Indexed Strategy will end on the same date in any given year. If you make a Purchase Payment after the initial Strategy Application Date, then your Purchase Payments will be applied to the Indexed Strategies on different Strategy Application Dates. In this case, an Indexed Strategy may have Terms that end on different dates in any given year.
Examples. These examples show how a Contract with multiple Purchase Payments may have Terms that end on different dates.
| You make your initial Purchase Payment on March 10 and another Purchase Payment on March 17. You allocate both payments to the same Indexed Strategy and both payments are applied on March 20. Each Term of that Indexed Strategy will start and end on March 20. |
| You make your initial Purchase Payment on May 2 and another Purchase Payment on June 14. You allocate both payments to the same Indexed Strategy. Your initial Purchase Payment is applied on May 6 and the other Purchase Payment is applied on June 20. That Indexed Strategy will have Terms that start and end on May 6 and other Terms that start and end on June 20. |
Investment Base
The value of an Indexed Strategy is calculated using the Investment Base. The Investment Base is not your Account Value, Surrender Value, Annuity Payout value, or Death Benefit value, but it is used to calculate those values.
The Investment Base is the amount applied to the Strategy at the start of the current Term, reduced proportionally for each withdrawal and related Early Withdrawal Charge during the current Term. The Investment Base is reduced daily by an amount equal to the Daily Charge.
A withdrawal and the Related Early Withdrawal Charge reduce the Investment Base by an amount that is proportional to the reduction in the value of the Indexed Strategy due to the withdrawal and the charge.
| If the Strategy value immediately before the withdrawal is greater than the Investment Base, then the reduction in the Investment Base will be less than the withdrawal and the related Early Withdrawal Charge. |
| If the Strategy value immediately before the withdrawal is less than the Investment Base, then the reduction in the Investment Base will be more than the withdrawal and the related Early Withdrawal Charge. |
24
Here are the formulas that we use to calculate a reduction in the Investment Base for a withdrawal, after Daily Charges have been taken into account.
Withdrawal as a percentage of Strategy value = withdrawal and related charge / Strategy value before withdrawal
Reduction in Investment Base = Investment Base before withdrawal x withdrawal as a percentage of Strategy value
Investment Base after withdrawal = Investment Base before withdrawalreduction in Investment Base
Indexed Strategy Value
At the end of a Term, unless you have made a Performance Lock election, the value of an Indexed Strategy is equal to:
| the Investment Base at the end of the Term; plus |
| any increase for a rise in the Index over the Term; or minus |
| any decrease for a fall in the Index over the Term. |
In this formula, the Investment Base at the end of the Term is equal to the amount applied to the Strategy at the start of that Term, reduced by Daily Charges, and reduced proportionally for each withdrawal and related Early Withdrawal Charge that you took during that Term. After we calculate the Investment Base at the end of the Term, we calculate any increase for a rise in the Index over that Term or any decrease for a fall in the Index over that Term. Any increase for the Term is subject to the Cap or Upside Participation Rate for that Term. Any decrease for the Term is subject to the Downside Participation Rate or Buffer.
Examples. At the end of a Term, the Investment Base in an Indexed Strategy is $5,000. You take a $1,000 withdrawal and no Early Withdrawal Charge applies to the withdrawal.
Assume that the Index had increased by 20% at the end of the Term, and either a Cap of 10% or an Upside Participation Rate of 50% was in place:
At Final Market Close of Term | ||
Rise in Index |
+20% | |
Increase as a Percentage |
+10% (10% Cap, or 50% Par Rate x 20%) | |
Dollar Amount of Increase |
+$500 ($5,000 x 10%) | |
Strategy value before Withdrawal |
$5,500 ($5,000 + $500) | |
Withdrawal Amount |
$1,000 | |
Strategy Value at Term End |
$4,500 ($5,500 - $1,000) |
If in this example an Early Withdrawal Charge of 5% applied to the entire withdrawal amount and you requested a net amount of $1,000, your withdrawal amount would have been $1,053 ($1,000 / (1 0.05)), resulting in a Strategy Value at Term End of $4,447 ($5,500 - $1,053).
Assume that the Index had decreased by 20% at the end of the Term, and a Buffer of 10%, a Floor of -10%, or a 50% Downside Participation Rate was in place:
At Final Market Close of Term | ||
Fall in Index |
-20% | |
Decrease as a Percentage |
-10% (20% fall minus 10% Buffer, or 50% Par Rate x -20%, or -10% Floor) | |
Dollar Amount of Decrease |
-$500 ($5,000 x -10%) | |
Strategy value before Withdrawal |
$4,500 ($5,000 - $500) | |
Withdrawal Amount |
$1,000 | |
Strategy Value at Term End |
$3,500 ($4,500 - $1,000) |
If in this example an Early Withdrawal Charge of 5% applied to the entire withdrawal amount and you requested a net amount of $1,000, your withdrawal amount would have been $1,053 ($1,000 / (1 0.05)), resulting in a Strategy value at Term End of $3,447 ($4,500 - $1,053).
On each day before the end of a Term, unless you have made a Performance Lock election, the value of an Indexed Strategy is equal to:
| the Investment Base on that day; plus |
| any increase for a positive Daily Value Percentage; or minus |
| any decrease for a negative Daily Value Percentage. |
25
In this formula, the Investment Base on each day before the end of the Term is equal to the amount applied to the Strategy at the start of that Term, reduced by Daily Charges, and reduced proportionally for each withdrawal and related Early Withdrawal Charge that you took on or before that day. After we calculate the Investment Base on that day, we calculate any increase for a positive Daily Value Percentage or any decrease for a negative Daily Value Percentage.
A withdrawal and the related Early Withdrawal Charge reduce the value of an Indexed Strategy by an amount equal to the withdrawal and the charge.
Examples. On the date of a withdrawal, the Investment Base in an Indexed Strategy is $5,000. You take a $1,000 withdrawal and no Early Withdrawal Charge applies to the withdrawal.
Assume that the Daily Value Percentage is 5% on the withdrawal date.
| The increase for the Daily Value Percentage is equal to $250 ($5,000 x 5%). |
| The Strategy value on the withdrawal date is $5,250 ($5,000 + $250). |
| The Strategy value after the withdrawal is $4,250 ($5,250 - $1,000). |
| The withdrawal as a percentage of the Strategy value is 19.05% ($1,000 / $5,250). |
| The reduction in the Investment Base is $952 ($5,000 x 19.05%). |
| The Investment Base after the withdrawal is $4,048 ($5,000 - $952). |
| Because the Strategy value on the withdrawal date was more than the Investment Base, the reduction in the Investment Base is only $952, which is less than the $1000 withdrawal. |
If in this example an Early Withdrawal Charge of 5% applied to the entire withdrawal amount and you requested a net amount of $1,000:
| The increase for the Daily Value Percentage is equal to $250 ($5,000 x 5%). |
| The Strategy value on the withdrawal date is $5,250 ($5,000 + $250). |
| The total amount withdrawn is $1,053 ($1,000 / (1 0.05)). |
| The Strategy value after the withdrawal is $4,197 ($5,250 - $1,053). |
| The withdrawal as a percentage of the Strategy value is 20.05% ($1,053 / $5,250). |
| The reduction in the Investment Base is $1,003 ($5,000 x 20.05%). |
| The Investment Base after the withdrawal is $3,997 ($5,000 - $1,003). |
| Because the Strategy value on the withdrawal date was more than the Investment Base, the reduction in the Investment Base was $1,003, which is less than the $1,053 withdrawal. |
Assume that the Daily Value Percentage is -10% on the withdrawal date.
| The reduction for the Daily Value Percentage is equal to $500 ($5,000 x -10%). |
| The Strategy value on the withdrawal date is $4,500 ($5,000 - $500). |
| The Strategy value after the withdrawal is $3,500 ($4,500 - $1,000). |
| The withdrawal as a percentage of the Strategy value is 22.22% ($1,000 / $4,500). |
| The reduction in the Investment Base is $1,111 ($5,000 x 22.22%). |
| The Investment Base after the withdrawal is $3,889 ($5,000 - $1,111). |
| Because the Strategy value on the withdrawal date was less than the Investment Base, the reduction in the Investment Base was $1,111, which is greater than the $1,000 withdrawal. |
If in this example an Early Withdrawal Charge of 5% applied to the entire withdrawal amount and you requested a net amount of $1,000:
| The reduction for the Daily Value Percentage is equal to $500 ($5,000 x 10%). |
| The Strategy value on the withdrawal date is $4,500 ($5,000 - $500). |
| The Strategy value after the withdrawal is $3,447 ($4,500 - $1,053). |
| The total amount withdrawn is $1,053 ($1,000 / (1 0.05)). |
| The withdrawal as a percentage of the Strategy value is 23.39% ($1,053 / $4,500). |
| The reduction in the Investment Base is $1,170 ($5,000 x 23.39%). |
| The Investment Base after the withdrawal is $3,830 ($5,000 - $1,170). |
| Because the Strategy value on the withdrawal date was less than the Investment Base, the reduction in the Investment Base was $1,170, which is greater than the $1,053 withdrawal. |
Performance Lock
Performance Lock is an election to lock in the Daily Value Percentage for the remainder of a Term of an Indexed Strategy. You can make a Performance Lock election for each Term of an S&P 500 Strategy and for each Term of a First Trust Barclays Edge Strategy that starts after the date of this prospectus. Only one performance lock election may be made for a given Term of a Strategy. Note: A Performance Lock election is not available for Contracts issued in Missouri.
26
You may make a Performance Lock election by a Request in Good Order. Once we receive your Request in Good Order, a Performance Lock election for a Term cannot be changed or revoked.
A Performance Lock election for a Term is effective on the second Market Close following our receipt of your Request in Good Order. After the second Market Close, the Strategy value before the end of the Term and the Strategy value at the end of the Term is based on the Daily Value Percentage as locked at that second Market Close. This means that the Net Option Value, Amortized Option Cost, and Trading Cost as of that second Market Close will apply from that date on through the end of the Term.
Beginning on that second Market Close and continuing through the end of the Term, the value of an Indexed Strategy is equal to:
| the Investment Base on that day; plus |
| any increase for a positive Daily Value Percentage, as locked on that second Market Close; or minus |
| any decrease for a negative Daily Value Percentage, as locked on that second Market Close. |
After a Performance Lock election is effective, the value of a locked Strategy will decline over the balance of the Term due to Daily Charges. The value of a locked Strategy will also be reduced by the amount of any withdrawal.
A Performance Lock election does not affect the Investment Base, so the Indexed Strategy value will still change if the Investment Base is reduced by a withdrawal.
If you make a Performance Lock election for the S&P 500 6-Year 10% Buffer with Upside Participation Rate Indexed Strategy before the sixth year of the Term, that Term will end on the next anniversary of the Term start date. If you take no action and do not send us a reallocation request by that anniversary, then we will apply the ending value of that Strategy to a new Term of the S&P 500 1-Year 50% Downside Participation rate with Upside Participation Rate Indexed Strategy.
Examples. You allocate $5,000 to an Indexed Strategy at the start of a 1-year Term. This means the Investment Base at the start of the Term is $5,000. You make a Performance Lock election, and on the second Market Close following receipt of that election the Daily Value Percentage is 5%.
Assume that you take no withdrawals.
| The increase for the locked Daily Value Percentage is equal to $250 ($5,000 x 5%). |
| On the second Market Close following receipt of the Performance Lock election, the Strategy value is $5,250 ($5,000 + $250). |
| The Strategy value on each following day of the Term remains $5,250 because the Daily Value Percentage is locked. No further changes in the Net Option Value, Amortized Option Cost, or Trading Cost are taken into account. |
| The ending Strategy value is $5,250. The normal calculation based on the percentage change in the Index over the 1-year Term does not apply. |
Assume you take a $1,000 withdrawal after the Performance Lock election is effective, and no Early Withdrawal Charge applies to the withdrawal:
| The increase for the locked Daily Value Percentage is equal to $250 ($5,000 x 5%). |
| On the second Market Close following receipt of the Performance Lock election, the Strategy value is $5,250 ($5,000 + $250). |
| Until the withdrawal, the Strategy value on each following day of the Term remains $5,250 because the Daily Value Percentage is locked. No further changes in the net option value, amortized option cost, or trading cost are taken into account. |
| Immediately after the $1,000 withdrawal, the Strategy value is $4,250 ($5,250 - $1,000). |
| The withdrawal as a percentage of the Strategy value is 19.05% ($1,000 / $5,250) |
| The proportionate reduction in the Investment Base is $952 ($5,000 x 19.05%). |
| The Investment Base after the withdrawal is $4,048 ($5,000 - $952). |
| Because the Strategy value on the withdrawal date was more than the Investment Base, the reduction in the Investment Base was $952, which is less than the $1,000 withdrawal. |
| After the withdrawal, on each following day of the Term, the increase for the locked Daily Value Percentage is equal to $202 ($4,048 x5%). |
| After the withdrawal, on each day of the Term, the Strategy value is $4,250 ($4,048 + $202). The reduction in the Strategy value is equal to the $1,000 withdrawal. |
| The ending Strategy value is $4,250. The normal calculation based on the percentage change in the Index over the 1-year Term does not apply. |
27
S&P 500 Index
The S&P 500® Index is designed to reflect the large-cap sector of the U.S. equity market and, due to its composition, it also represents the U.S. equity market in general. It includes 500 leading companies and captures approximately 80% coverage of available market capitalization. The S&P 500 Index does not include dividends declared by any of the companies in this index. Consequently, any positive change in the Index over a Term will be lower than the total return on a direct investment in the stocks that comprise the S&P 500 Index.
The S&P 500 Index is subject to multiple principal investment risks, such as those related to its investments in large-capitalization companies. The S&P 500 Index tracks a subset of the U.S. stock market, which could cause the S&P 500 Index to perform differently from the overall stock market. In general, large-capitalization companies may be unable to respond quickly to new competitive challenges, and may not be able to attain the high growth rate of successful smaller companies. In addition, the S&P 500 Index may, at times, become focused in stocks of a particular market sector, which would subject the S&P 500 Index to proportionately higher exposure to the risks of that sector.
The S&P 500 Index is a product of S&P Dow Jones Indices LLC or its affiliates (SPDJI), and has been licensed for use by MassMutual Ascend Life. Standard & Poors®, S&P®, S&P 500®, US 500, The 500, iBoxx®, iTraxx® and CDX® are trademarks of S&P Global, Inc. or its affiliates (S&P); Dow Jones® is a registered trademark of Dow Jones Trademark Holdings LLC (Dow Jones). MassMutual Ascend Life products are not sponsored, endorsed, sold or promoted by SPDJI, Dow Jones, S&P or their respective affiliates, and none of such parties makes any representation regarding the advisability of investing in such products nor do they have any liability for any errors, omissions, or interruption of the S&P 500 Index. For more information, visit www.US.SPIndices.com.
SPDR Gold Shares ETF
The SPDR Gold Shares represent units of beneficial interest in, and ownership of, the SPDR Gold Trust, an exchange traded fund that holds gold bullion. The investment objective of the trust is for the shares to reflect the performance of the price of gold bullion, less the trusts expenses. The shares are designed to mirror as closely as possible the price of gold, and the value of the shares relates directly to the value of the gold held by the trust, less its liabilities. The value of the gold held by the trust is determined using the London Bullion Market Association (LBMA) Gold Price PM.
The fund is subject to several principal investment risks related to the price of gold. The price of gold has fluctuated widely over the past several years and the shares have experienced significant price fluctuations. Several factors may affect the price of gold, including:
| Global gold supply and demand, which is influenced by such factors as golds uses in jewelry, technology and industrial applications, purchases made by investors in the form of bars, coins and other gold products, forward selling by gold producers, purchases made by gold producers to unwind gold hedge positions, central bank purchases and sales, and production and cost levels in major gold producing countries such as China, the United States and Australia; |
| Global or regional political, economic or financial events and situations, especially those unexpected in nature; |
| Investors expectations with respect to the rate of inflation; |
| Currency exchange rates; |
| Interest rates; |
| Investment and trading activities of hedge funds and commodity funds; and |
| Other economic variables such as income growth, economic output, and monetary policies. |
The principal investment risks of the fund are described in the funds prospectus, including the following risks: price risk, passive investment risk, trading market risk, and risk of loss, damage, theft, or restriction on access.
The Gold Shares trade on the NYSE Arca under the symbol GLD. For more information, visit www.spdrgoldshares.com.
iShares MSCI EAFE ETF
The iShares MSCI EAFE ETF is an exchange traded fund that seeks to track the investment results of an index composed of large- and mid-capitalization developed market equities, excluding the U.S. and Canada (MSCI EAFE Index). This underlying index includes stocks from Europe, Australasia and the Far East. It may include large- or mid-capitalization companies. The components of the underlying index, and the degree to which these components represent certain industries and/or countries, are likely to change over time. The funds adviser uses an indexing strategy that involves investing in a representative sample of securities that collectively has an investment profile similar to that of the underlying index. The funds performance will be reduced by its expenses and fees.
The fund is subject to several principal investment risks, such as those related to its investments in large- and mid-capitalization foreign companies. In general, large-capitalization companies may be unable to respond quickly to new competitive challenges, and may not be able to attain the high growth rate of successful smaller companies. Generally, the securities of mid-capitalization companies may be more volatile and may involve more risk than the securities of larger companies. Mid-capitalization companies are also more likely to fail than larger companies. Securities issued by non-U.S. companies are subject to the risks related to investments in foreign markets (e.g., increased price volatility; changing currency exchange rates; and greater political, regulatory and economic uncertainty). Because the fund is an ETF, it is also exposed to the risks associated with the operation of any ETF. The value of its shares, which are valued based on their trading prices in the secondary market, may change rapidly and unpredictably and may trade at premiums or discounts to the funds net asset value.
28
The principal investment risks of the fund are described in the funds prospectus, including the following risks: asset class risk, authorized participant concentration risk, concentration risk, currency risk, cyber security risk, equity securities risk, financials sector risk, geographic risk, index-related risk, issuer risk, large-capitalization companies risk, management risk, market risk, market trading risk, mid-capitalization companies risk, national closed market trading risk, non-U.S. securities risk, operational risk, passive investment risk, reliance on trading partners risk, risk of investing in developed countries, risk of investing in Japan, securities lending risk, structural risk, tracking error risk and valuation risk.
The funds shares trade on the NYSE Arca under the symbol EFA.
The iShares MSCI EAFE ETF is distributed by BlackRock Investments, LLC. iShares®, BLACKROCK®, and the corresponding logos are registered and unregistered trademarks of BlackRock, Inc. and its affiliates (BlackRock), and these trademarks have been licensed for certain purposes by MassMutual Ascend Life Insurance Company. MassMutual Ascend Life annuity products are not sponsored, endorsed, sold or promoted by BlackRock, and purchasers of an annuity from MassMutual Ascend Life do not acquire any interest in the iShares MSCI EAFE ETF nor enter into any relationship of any kind with BlackRock. BlackRock makes no representation or warranty, express or implied, to the owners of any MassMutual Ascend Life annuity product or any member of the public regarding the advisability of purchasing an annuity, nor does it have any liability for any errors, omissions, interruptions or use of the iShares MSCI EAFE ETF or any data related thereto.
iShares U.S. Real Estate ETF
The iShares U.S. Real Estate ETF is an exchange traded fund that seeks to track the investment results of an index composed of U.S. equities in the real estate sector (Dow Jones U.S. Real Estate Index). This underlying index may include large-, mid- or small-capitalization companies. A significant portion of the underlying index is represented by real estate investment trusts (REITs), but the components are likely to change over time. The funds adviser uses an indexing strategy that involves investing in a representative sample of securities that collectively has an investment profile similar to that of the underlying index. The funds performance will be reduced by its expenses and fees.
The fund is subject to several principal investment risks, such as those related to its investments in large-, mid- and small-capitalization U.S. companies in the real estate sector. In general, large-capitalization companies may be unable to respond quickly to new competitive challenges, and may not be able to attain the high growth rate of successful smaller companies. Generally, the securities of smaller companies (including mid- and small-capitalization companies) may be more volatile and may involve more risk than the securities of larger companies. Smaller companies are also more likely to fail than larger companies. Companies that invest in real estate are highly sensitive to the risks of owning real estate, to general and local economic conditions and developments in the real estate market, and to changes in interest rates. Many companies that invest in real estate utilize leverage (and some may be highly leveraged), which increases investment risk, and could potentially magnify the funds losses. Because the fund is an ETF, it is also exposed to the risks associated with the operation of any ETF. The value of its shares, which are valued based on their trading prices in the secondary market, may change rapidly and unpredictably and may trade at premiums or discounts to the funds net asset value.
The principal investment risks of the fund are described in the funds prospectus, including the following risks: asset class risk, authorized participant concentration risk, concentration risk, cyber security risk, dividend risk, equity securities risk, index-related risk, issuer risk, large-capitalization companies risk, management risk, market risk, market trading risk, mid-capitalization companies risk, operational risk, passive investment risk, real estate investment risk, risk of investing in the United States, securities lending risk and tracking error risk.
The funds shares trade on the NYSE Arca under the symbol IYR.
The iShares U.S. Real Estate ETF is distributed by BlackRock Investments, LLC. iShares®, BLACKROCK®, and the corresponding logos are registered and unregistered trademarks of BlackRock, Inc. and its affiliates (BlackRock), and these trademarks have been licensed for certain purposes by MassMutual Ascend Life Insurance Company. MassMutual Ascend Life annuity products are not sponsored, endorsed, sold or promoted by BlackRock, and purchasers of an annuity from MassMutual Ascend Life do not acquire any interest in the iShares U.S. Real Estate ETF nor enter into any relationship of any kind with BlackRock. BlackRock makes no representation or warranty, express or implied, to the owners of any MassMutual Ascend Life annuity product or any member of the public regarding the advisability of purchasing an annuity, nor does it have any liability for any errors, omissions, interruptions or use of the iShares U.S. Real Estate ETF or any data related thereto.
First Trust Barclays Edge Index
The First Trust Barclays Edge Index is designed to combine capital strength and value equity investment methodologies with a mix of US Treasuries for more consistent returns. The First Trust Barclays Edge Index consists of an equity component that combines stocks from the Capital Strength Index or The Value Line Dividend Index coupled with a volatility control using a mix of 2-year, 5-year and 10-year US Treasuries. Based on various market factors the First Trust Barclays Edge Index may vary the balance between stocks and bonds and the exposure to the market to target a seven percent (7%) volatility level. Note: The First Trust Barclays Edge Strategies are not available for Contracts issued in Missouri.
For more information visit https://www.ftindexingsolutions.com/
29
The First Trust Barclays Edge Index (FTIS Index) is a product of FT Indexing Solutions LLC (FTIS) and is administered and calculated by Bloomberg Finance L.P. and its affiliates (collectively, Bloomberg). FIRST TRUST® is a trademark of First Trust Portfolios L.P. (collectively, with FTIS and their respective affiliates, First Trust). The foregoing index and trademark have been licensed for use for certain purposes by Barclays, Bloomberg, and MassMutual Ascend Life Insurance Company (MassMutual Ascend) in connection with the FTIS Index and the Index Summit 6 Pro annuity.
The Capital Strength Index (Nasdaq Index) is a product of Nasdaq, Inc. (collectively, with its affiliates, Nasdaq). NASDAQ®, CAPITAL STRENGTH INDEXTM, and NQCAPSTTM are trademarks of Nasdaq. The foregoing index and trademarks have been licensed for use for certain purposes by FTIS and MassMutual Ascend in connection with the FTIS Index and the Index Summit 6 Pro annuity.
The Value Line Dividend Index (Value Line Index) is a product of Value Line, Inc. (Value Line). VALUE LINE® and VALUE LINE DIVIDEND INDEXTM are trademarks or registered trademarks of Value Line. The foregoing index and trademarks have been licensed for use for certain purposes by FTIS and MassMutual Ascend in connection with the FTIS Index and the Index Summit 6 Pro annuity. The FTIS Index is not sponsored, endorsed, recommended, sold or promoted by Value Line and Value Line makes no representation regarding the advisability of investing in the FTIS Index.
The Index Summit 6 Pro annuity is not issued, sponsored, endorsed, sold, recommended, or promoted by First Trust, Bloomberg, Nasdaq, Value Line, or their respective affiliates (collectively, the Companies). Bloombergs relationship to First Trust and Barclays is only (1) in the licensing of the FIRST TRUST®, BARCLAYS®, and FIRST TRUST BARCLAYS EDGE INDEXTM trademarks and (2) to act as the administrator and calculation agent of the First Trust Barclays Edge Index. The Companies have not passed on the legality or suitability of, or the accuracy or adequacy of descriptions and disclosures relating to the Index Summit 6 Pro annuity. The Companies make no representation or warranty, express or implied, to the owners of any product based on the FTIS Index, Barclays Indexes, Nasdaq Index, or Value Line Index, or to any member of the public regarding the advisability of investing in securities generally or in products based on the FTIS Index, Dow Index, Nasdaq Indices, or Value Line Index particularly, or the ability of the FTIS Index, Dow Index, Nasdaq Indices, or Value Line Index to track general stock market performance. The Companies only relationship to MassMutual Ascend is in the licensing of the certain trademarks, trade names, and service marks and the use of the FTIS Index, Dow lndex, Nasdaq Indices, and Value Line Indices, which are determined, composed and calculated without regard to MassMutual Ascend or the Index Summit 6 Pro annuity. The Companies have no obligation to take the needs of MassMutual Ascend, or the owners of the Index Summit 6 Pro annuity, or the sponsors or owners of products based on the FTIS Index, Barclays Indexes, Nasdaq Index, or Value Line Index into consideration when determining, composing, or calculating the FTIS Index, Barclays Indexes, Nasdaq Index, and Value Line Index. The Companies are not responsible for and have not participated in the determination or calculation of the Index Summit 6 Pro annuity. There is no assurances from the Companies that products based on the FTIS Index, Barclays Indexes, Nasdaq Index, or Value Line Index will accurately track index performance or provide positive investment returns. The Companies are not investment advisors. Inclusion of a security or financial instrument within an index is not a recommendation by the Companies to buy, sell, or hold such security or financial instrument, nor is it considered to be investment advice.
THE COMPANIES DO NOT GUARANTEE THE ADEQUACY, ACCURACY, TIMELINESS, COMPLETENESS, AND/OR UNINTERRUPTED CALCULATION OF THE INDEX SUMMIT 6 PRO ANNUITY, FTIS INDEX, BARCLAYS INDEXES, NASDAQ INDEX, VALUE LINE INDEX, OR ANY DATA INCLUDED THEREIN OR ANY COMMUNICATION WITH RESPECT THERETO, INCLUDING, ORAL, WRITTEN, OR ELECTRONIC COMMUNICATIONS. THE COMPANIES SHALL HAVE NO LIABILITY FOR ANY ERRORS, OMISSIONS, OR INTERRUPTIONS IN THE INDEX SUMMIT 6 PRO ANNUITY, FTIS INDEX, BARCLAYS INDEXES, NASDAQ INDEX, OR VALUE LINE INDEX. THE COMPANIES MAKE NO WARRANTY, EXPRESS OR IMPLIED, AS TO THE RESULTS TO BE OBTAINED BY OWNERS OF THE INDEX SUMMIT 6 PRO ANNUITY OR OF PRODUCTS BASED ON THE FTIS INDEX, BARCLAYS INDEXES, NASDAQ INDEX, OR VALUE
LINE INDEX, OR BY ANY OTHER PERSON OR ENTITY FROM THE USE OF THE FTIS INDEX, BARCLAYS INDEXES, NASDAQ INDEX, OR VALUE LINE INDEX, OR ANY DATA INCLUDED THEREIN. THE COMPANIES MAKE NO EXPRESS OR IMPLIED WARRANTIES, AND EXPRESSLY DISCLAIM ALL WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE WITH RESPECT TO THE INDEX SUMMIT 6 PRO ANNUITY, FTIS INDEX, BARCLAYS INDEXES, NASDAQ INDEX, VALUE LINE INDEX, OR ANY DATA INCLUDED THEREIN. WITHOUT LIMITING ANY OF THE FOREGOING, IN NO EVENT SHALL THE COMPANIES BE SUBJECT TO ANY DAMAGES OR HAVE ANY LIABILITY FOR ANY INDIRECT, SPECIAL, INCIDENTAL, PUNITIVE, INDIRECT, OR CONSEQUENTIAL DAMAGES OR LOSSES, INCLUDING BUT NOT LIMITED TO, LOSS OF PROFITS, TRADING LOSSES, LOST TIME, OR GOODWILL, EVEN IF NOTIFIED OF THE POSSIBILITY OF SUCH DAMAGES, WHETHER IN CONTRACT, TORT, STRICT LIABILITY, OR OTHERWISE. THERE ARE NO THIRD PARTY BENEFICIARIES OF ANY AGREEMENTS OR ARRANGEMENTS BETWEEN MASSMUTUAL ASCEND AND THE COMPANIES.
Neither Barclays Bank PLC (BB PLC) nor any of its affiliates (collectively Barclays) is the issuer or producer of the Index Summit 6 Pro annuity and Barclays has no responsibilities, obligations or duties to investors in the Index Summit 6 Pro annuity. The Barclays US 2Y Treasury Futures Index, Barclays US 5Y Treasury Futures Index, Barclays US 10Y Treasury Futures Index, and Barclays US 30Y Treasury Futures Index (collectively, the Indices), together with any Barclays indices that are components of the Indices, are trademarks owned by Barclays and, together with any component indices and index data, are licensed for use by MassMutual Ascend as the issuer or producer of the Index Summit 6 Pro annuity (the Issuer).
30
Barclays only relationship with the Issuer in respect of the Indices is the licensing of the Indices, which are administered, compiled and published by BB PLC in its role as the index sponsor (the Index Sponsor) without regard to the Issuer or the Index Summit 6 Pro annuity or investors in the Index Summit 6 Pro annuity. Additionally, MassMutual Ascend as issuer or producer of the Index Summit 6 Pro annuity may for itself execute transaction(s) with Barclays in or relating to the Indices in connection with the Index Summit 6 Pro annuity. Investors acquire the Index Summit 6 Pro annuity from MassMutual Ascend and investors neither acquire any interest in the Indices nor enter into any relationship of any kind whatsoever with Barclays upon making an investment in the Index Summit 6 Pro annuity. The Index Summit 6 Pro annuity is not sponsored, endorsed, sold or promoted by Barclays and Barclays makes no representation regarding the advisability of the Index Summit 6 Pro annuity or use of the Indices or any data included therein. Barclays shall not be liable in any way to the Issuer, investors or to other third parties in respect of the use or accuracy of the Indices or any data included therein.
Barclays Index Administration (BINDA), a distinct function within BB PLC, is responsible for day-to-day governance of BB PLCs activities as Index Sponsor. To protect the integrity of Barclays indices, BB PLC has in place a control framework designed to identify and remove and/or mitigate (as appropriate) conflicts of interest. Within the control framework, BINDA has the following specific responsibilities:
| oversight of any third party index calculation agent; |
| acting as approvals body for index lifecycle events (index launch, change and retirement); and |
| resolving unforeseen index calculation issues where discretion or interpretation may be required (for example: upon the occurrence of market disruption events). |
To promote the independence of BINDA, the function is operationally separate from BB PLCs sales, trading and structuring desks, investment managers, and other business units that have, or may be perceived to have, interests that may conflict with the independence or integrity of Barclays indices.
Notwithstanding the foregoing, potential conflicts of interest exist as a consequence of BB PLC providing indices alongside its other businesses. Please note the following in relation to Barclays indices:
| BB PLC may act in multiple capacities with respect to a particular index including, but not limited to, functioning as index sponsor, index administrator, index owner and licensor. |
| Sales, trading or structuring desks in BB PLC may launch products linked to the performance of a index. These products are typically hedged by BB PLCs trading desks. In hedging an index, a trading desk may purchase or sell constituents of that index. These purchases or sales may affect the prices of the index constituents which could in turn affect the level of that index. |
| BB PLC may establish investment funds that track an index or otherwise use an index for portfolio or asset allocation decisions. |
The Index Sponsor is under no obligation to continue the administration, compilation and publication of the Indices or the level of the Indices. While the Index Sponsor currently employs the methodology ascribed to the Indices (and application of such methodology shall be conclusive and binding), no assurance can be given that market, regulatory, juridical, financial, fiscal or other circumstances (including, but not limited to, any changes to or any suspension or termination of or any other events affecting any constituent within the Index) will not arise that would, in the view of the Index Sponsor, necessitate an adjustment, modification or change of such methodology. In certain circumstances, the Index Sponsor may suspend or terminate the Indices. The Index Sponsor has appointed a third-party agent (the Index Calculation Agent) to calculate and maintain the Indices. While the Index Sponsor is responsible for the operation of the Indices, certain aspects have thus been outsourced to the Index Calculation Agent.
Barclays
1. makes no representation or warranty, express or implied, to the Issuer or any member of the public regarding the advisability of investing in transactions generally or the ability of the Indices to track the performance of any market or underlying assets or data; and
2. has no obligation to take the needs of the Issuer into consideration in administering, compiling or publishing the Indices.
Barclays has no obligation or liability in connection with administration, marketing or trading of the Index Summit 6 Pro annuity.
The licensing agreement between MassMutual Ascend and BB PLC is solely for the benefit of MassMutual Ascend and Barclays and not for the benefit of the owners of the Index Summit 6 Pro annuity, investors or other third parties.
BARCLAYS DOES NOT GUARANTEE, AND SHALL HAVE NO LIABILITY TO THE PURCHASERS AND TRADERS, AS THE CASE MAY BE, OF THE TRANSACTION OR TO THIRD PARTIES FOR THE QUALITY, ACCURACY AND/OR COMPLETENESS OF THE INDICES OR ANY DATA INCLUDED THEREIN OR FOR INTERRUPTIONS IN THE DELIVERY OF THE INDICES. BARCLAYS MAKES NO EXPRESS OR IMPLIED WARRANTIES, AND HEREBY EXPRESSLY DISCLAIMS ALL WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE WITH RESPECT TO THE INDICES INCLUDING, WITHOUT LIMITATION, THE INDICES, OR ANY DATA INCLUDED THEREIN. IN NO EVENT SHALL BARCLAYS HAVE ANY LIABILITY FOR ANY SPECIAL, PUNITIVE, INDIRECT, OR CONSEQUENTIAL DAMAGES, OR ANY LOST PROFITS, EVEN IF NOTIFIED OF THE POSSIBLITY OF SUCH DAMAGES SAVE TO THE EXTENT THAT SUCH EXCLUSION OF LIABILITY IS PROHIBITED BY LAW.
None of the information supplied by Barclays and used in this publication may be reproduced in any manner without the prior written permission of Barclays Bank PLC. Barclays Bank PLC is registered in England No. 1026167. Registered office 1 Churchill Place London E14 5HP.
31
Bloomberg Index Services Limited is the official index calculation and maintenance agent of the Index, an index owned and administered by Barclays. Bloomberg Index Services Limited does not guarantee the timeliness, accurateness, or completeness of the Index calculations or any data or information relating to the Index. Bloomberg Index Services Limited makes no warranty, express or implied, as to the Index or any data or values relating thereto or results to be obtained therefrom, and expressly disclaims all warranties of merchantability and fitness for a particular purpose with respect thereto. To the maximum extent allowed by law, Bloomberg Index Services Limited, its affiliates, and all of their respective partners, employees, subcontractors, agents, suppliers and vendors (collectively, the protected parties) shall have no liability or responsibility, contingent or otherwise, for any injury or damages, whether caused by the negligence of a protected party or otherwise, arising in connection with the calculation of the Index or any data or values included therein or in connection therewith and shall not be liable for any lost profits, losses, punitive, incidental or consequential damages.
Index Values
For Indexed Strategies that use the S&P 500 Index or the First Trust Barclays Edge Index, the Index is the level of the S&P 500 Index or the First Trust Barclays Edge Index for the applicable Market Close. For Indexed Strategies that use the SPDR Gold Shares ETF, the iShares MSCI EAFE ETF or the iShares U.S. Real Estate ETF, the Index is the applicable exchange-traded funds share price on the NYSE Arca at the applicable Market Close.
We will use consistent sources to obtain the values of an Index. We currently obtain the values for the S&P 500 Index and the SPDR Gold Shares ETF from S&P Dow Jones Indices LLC and the values for the iShares MSCI EAFE ETF and iShares U.S. Real Estate ETF from BlackRock, Inc. and the value of the First Trust Barclays Edge Index from Bloomberg Index Services Limited. If those sources are no longer available, we will select an alternative published source(s) to obtain such values.
Index Replacement
We may replace an Index: if it is discontinued, we are no longer able to use it, its calculation changes substantially, or we determine that hedging instruments are difficult to acquire or the cost of hedging becomes excessive. We may do so at the end of a Term or during a Term. We will notify you in writing at least 30 days before we replace an Index.
We would attempt to choose a replacement Index that is similar to the old Index. To determine if a new Index is similar, we will consider factors such as asset class, index composition, strategy or methodology inherent to the index and index liquidity.
If we replace an Index during a Term, we will calculate the rise and fall in the Index using the old Index up until the replacement date. After the replacement date, we will calculate the rise and fall in the Index using the new Index, but with a modified start of Term value for the new Index. The modified start of Term value for the new index will reflect the rise or fall in the Index for the old Index from the start of the Term to the replacement date.
If we replace an Index, the Caps and Upside Participation Rates for the Term and the Floor, Buffer and Downside Participation Rate will not change.
Example. This example is intended to show how we would calculate the Strategy value on any day during a Term if we have replaced an Index during the Term. This example assumes: (1) you allocate $50,000 to an Indexed Strategy; (2) the replacement is made on day 90 of the Term; and (3) no Performance Lock election has been made. To simplify the example, we assume that you take no withdrawals during the Term.
Rise or Fall of Index on Replacement Date for Old Index | ||
Old Index at Term start |
1000 | |
Old Index on replacement date |
1050 | |
Rise or fall of old Index on replacement date |
(1050 - 1000) / 1,000 = 5% |
32
The 5% rise in the old Index on the replacement date is then used to calculate the modified start of Term value for the new Index.
Modified Start of Term Value for New Index | ||
Rise in old Index on replacement date |
5% | |
New Index on replacement date |
1785 | |
Modified start of Term value for new Index |
1785 / (100% + 5%) = 1700 |
The modified start of Term value for the new Index is then used to calculate the Indexed Strategy value on any date after the replacement date, including the value at the Term end.
Indexed Strategy Value at Term End | ||
Investment Base at Term start |
$50,000 | |
Accumulated Daily Charges |
$375 | |
Investment Base After Daily Charges |
$49,625 | |
Modified start of Term value for new Index |
1700 | |
Value of new Index at Term end |
1853 | |
Rise in new Index |
(1853 - 1,700) / 1700) = 9% | |
Cap |
8% | |
Rise in new Index limited by Cap |
8% | |
Increase as a percentage |
8% x 100% = 8% | |
Dollar amount of increase |
$49,625 x 8% = $3,970 | |
Strategy value at Term end |
$49,625 + $3,970 = $53,595 |
CAPS, PARTICIPATION RATES, FLOORS, AND BUFFERS
We set limits for the increase and reduction in the value of an Indexed Strategy over a Term that apply after Daily Charges are deducted from the Investment Base. We limit increases with a Cap or an Upside Participation Rate. We limit reductions with a Downside Participation Rate, Floor, or a Buffer. For information about the current Caps and Participation Rates offered for new Contracts, please contact your registered representative or refer to our website (www.massmutualascend.com/RILArates).
Cap. The Cap for an Indexed Strategy is the largest rise in the Index over a Term that is taken into account to determine the Strategy value at the end of that Term. Before the end of a Term, the Cap is reflected in the formulas that we use to calculate the Net Option Price.
| The Cap will vary among Indexed Strategies. |
| The Cap for a given Indexed Strategy will vary from Term to Term. |
| We guarantee that the Cap for a Term of an Indexed Strategy will never be less than 1%. |
| For each Term, your return on an Indexed Strategy with a Cap will be less than any rise in the Index over that Term. |
| For each Term, your return on an Indexed Strategy with a Cap will be less than the Cap for that Term. |
| Your return on an Indexed Strategy with a Cap could be negative even when the Index rises. This will occur when the amount of increase attributable to an Index rise is smaller than the Daily Charge. |
Upside Participation Rate. The Upside Participation Rate for an Indexed Strategy is your share of any rise in the Index over a Term that is taken into account to determine the Strategy value at the end of that Term. Before the end of a Term, the Upside Participation Rate is reflected in the formulas that we use to calculate Net Option Price.
| The Upside Participation Rate will vary among Indexed Strategies. |
| The Upside Participation Rare for a given Indexed Strategy will vary from Term to Term. |
| We guarantee that the Upside Participation Rate for a Term of an Indexed Strategy will never be less than 5%. |
| For each Term, your return on an Indexed Strategy with an Upside Participation Rate of less than 100% will be less than any rise in the Index over that Term. In addition, any increase for the Term will be reduced by the Daily Charge. |
| Your return on an Indexed Strategy with an Upside Participation Rate could be negative even when the Index rises. This will occur when the amount of increase attributable to an Index rise is smaller than the Daily Charge. |
Caps and Upside Participation Rates. We set Caps and Upside Participation Rates based on the length of the Term, the cost of hedging, interest rates, and other market factors. On a non-discriminatory basis, we may also take into account the amount of the Purchase Payments received for a Contract. The Caps and Upside Participation Rates for Contracts with larger Purchase Payments may be higher than the Caps and Upside Participations Rates for Contracts with smaller Purchase Payments.
33
Caps and Upside Participation Rates for Initial Terms. Each Purchase Payment is applied to an initial Term of a Strategy on the first Strategy Application Date on or after the date that the payment is received. The Caps and Upside Participation Rates for each Strategy Application Date may vary. The Caps and Upside Participation Rates for the first Strategy Application Date will be available on our website (www.massmutualascend.com/RILArates) on the date you signed the application (as long as we receive the application for the Contract within eight days after the date you sign it) and before the date of any Purchase Payment to which the Caps or Upside Participation Rates will apply. If we receive the application for the Contract within eight days after the date you sign it, we will guarantee the Caps and Upside Participation Rates in effect on the date you signed the application for three Strategy Application Dates from the date of the application.
If we receive the signed application within eight days after the date you sign it, then for any 1-year Indexed Strategy or 2-year Indexed Strategy:
| For an initial Term starting on the first Strategy Application Date on or after the application date, the Cap or Upside Participation Rate will be the Cap or Upside Participation Rate in effect on the date you signed the application. |
| For an initial Term starting on one of the next two Strategy Application Dates, the Cap or Upside Participation Rate will be the higher of the Cap or Upside Participation Rate in effect on the date you signed the application or the Cap or Upside Participation Rate otherwise in effect for that Strategy Application Date. |
| For any initial Term starting on a later Strategy Application Date, the Cap or Upside Participation Rate will be the Cap or Upside Participation Rate in effect for that Strategy Application Date. |
If we receive the signed application within eight days after the date you sign it, then for the 6-year Indexed Strategy:
| For an initial Term starting on the first Strategy Application Date on or after the application date or one of the next two Strategy Application Dates, the Cap or Upside Participation Rate will be the Cap or Upside Participation Rate in effect on the date you signed the application. |
| For any initial Term starting on a later Strategy Application Date, the Cap or Upside Participation Rate will be the Cap or Upside Participation Rate in effect for that Strategy Application Date. |
If we receive the signed application more than eight days after the date you sign it, then the guarantee does not apply and the Cap or Upside Participation Rate for each Initial Term will be the Cap or Upside Participation Rate in effect for that Strategy Application Date.
Example 1: You sign an application for a Contract on May 1 and allocate all of your Purchase Payments to the S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy. On the date of the application, the Upside Participation Rate for the first Strategy Application Date (May 6) is 80%. We receive the application and the first Purchase Payment from you on May 8 and the second Purchase Payment from you on May 23. The Upside Participation Rates for the next two Strategy Application Dates are 85% (May 20) and 75% (June 6).
In this case, the initial 1-year Term for the first Purchase Payment would begin on May 20 and would have an 85% Participation Rate (the higher of the May 6 rate or the May 20 rate). The initial 1-year Term for the second Purchase Payment would begin on June 6 and would have an 80% Participation Rate (the higher of the May 6 rate or the June 6 rate).
If we had not received your signed application until May 10 (more than eight days after the date you signed the application), then you would not qualify for the rate guarantee, and the initial 1-year Term for the first Purchase Payment received on May 8 would have an 85% Participation Rate (the May 20 rate effective for Purchase Payments received between May 7 and May 20), and the initial 1-year Term for the second Purchase Payment received on May 23 would have a 75% Participation Rate (the June 6 rate effective for Purchase Payments received between May 21 and June 6).
Example 2: You sign an application for a Contract on May 1 and allocate all of your Purchase Payments to the 6-year 10% Buffer with Upside Participation Rate Strategy. On the date of the application, the Upside Participation Rate for the first Strategy Application Date (May 6) is 105%. We receive the application and the first Purchase Payment from you on May 8 and the second Purchase Payment from you on May 23. The Upside Participation Rates for the next two Strategy Application Dates are 110% (May 20) and 95% (June 6).
In this case, the initial 6-year Term for the first Purchase Payment would begin on May 20 and would have a 105% Participation Rate (the May 6 rate), and the initial 6-year Term for the second Purchase Payment would have a 105% Participation Rate (the May 6 rate).
If we had not received your signed application until May 10 (more than eight days after the date you signed the application), then the initial 6-year Term for the first Purchase Payment would have an 110% Participation Rate (the May 20 rate), and the initial 1-year Term for the second Purchase Payment would have a 95% Participation Rate (the June 6 rate).
Caps and Upside Participation Rate for Subsequent Terms. At least 30 days before the end of each Term, we will send you a written notice with information about the Indexed Strategies that will be available for the next Term, and will indicate the date by which the Caps and Upside Participation Rates will be posted on our website. The Caps and Participation Rates for the next Term will be available on our website (www.massmutualascend.com/RILArates) at least 10 days before the start of the Term. You should consider this information before finalizing your renewal or reallocation decision.
34
Downside Participation Rate. The Downside Participation Rate for an Indexed Strategy is your share of any fall in the Index over the Term that is taken into account to determine the Strategy value at the end of that Term. Before the end of a Term, the Downside Participation Rate is reflected in the formulas that we use to calculate the Net Option Price.
For each Term of each Strategy other than the Buffer Strategy that we currently offer for this Contract, the Downside Participation Rate is 50%. The Downside Participation Rate for an Indexed Strategy that is available on the Contract Effective Date will not change.
When the Index falls over a Term, the resulting Strategy Value decrease will be larger than 50% of the Index fall. This is because the Daily Charge reduces the Investment Base before the Index fall is taken into account.
In the future, we may offer a new Strategy with a Downside Participation Rate that is more or less than 50%.
Floor. The Floor for an Indexed Strategy is the portion of any fall in the Index for the Term that is taken into account to determine the Strategy value at the end of that Term. For each Term of each Floor Strategy that we currently offer for this Contract, the Floor is either -10% or 0%. Before the end of a Term, the Floor is reflected in the formulas that we use to calculate the Net Option Price.
The Floor for an Indexed Strategy that is available on the Contract Effective Date will not change.
In the future, we may offer a new Floor Strategy with a Floor that is more or less negative than -10%.
Buffer. The Buffer for an Indexed Strategy is the portion of any fall in the Index over the Term that is disregarded when determining the Strategy value at the end of that Term. Before the end of a Term, the Buffer is reflected in the formulas that we use to calculate the Net Option Price.
For each Term of each Buffer Strategy that we currently offer for this Contract, the Buffer is 10%. The Buffer for an Indexed Strategy that is available on the Contract Effective Date will not change.
When the Index falls over a Term, the resulting Buffer Strategy Value decrease will be larger than the rate of the Index fall minus 10%. This is because the Daily Charge reduces the Investment Base before the Index fall is taken into account.
In the future, we may offer a new Strategy with a Buffer that is more or less than 10%.
INDEXED STRATEGY VALUE AT END OF TERM
On or after the final Market Day of a Term, unless you have made a Performance Lock election, the value of an Indexed Strategy is the Investment Base increased for any rise in the applicable Index or decreased for any fall in the applicable Index over that Term. If you have made a Performance Lock election, then the normal rules set out in this section do not apply, and the value at the end of a Term is determined as described under Indexed Strategy Value After Performance Lock Election section on page [ ].
After taking Daily Charges into account, any increase or decrease is based on the rise or fall in the applicable Index since the start of that Term. This rise or fall is expressed as a percentage of the Index at the start of the Term. It is measured from the Index at the last Market Close on or before the first day of that Term to the Index at the final Market Close of the Term.
Example. The Index was 1000 at the last Market Close on or before for first day of a Term.
| If the Index at the final Market Close of the Term is 1065, then the Index has risen by 6.5% ((1065 1000) / 1000). |
| If the Index at the final Market Close of the Term is 925, then the Index has fallen by 7.5% ((925 1000) / 1000). |
Downside Participation Rate with Cap Strategy
In the absence of a Performance Lock election, here are the formulas that we use to calculate the Strategy value at the end of a Term of a Downside Participation Rate Strategy with a Cap.
Strategy value at end of Term = Investment Base + dollar amount of increase or decrease
Dollar amount of increase or decrease = Investment Base (after taking Daily Charges into account) x increase or decrease percentage
Increase percentage = any rise in the Index over the Term, but never more than the Cap
Decrease percentage = any fall in the Index over the Term x Downside Participation Rate
35
Example. At the beginning of a Term, you allocate $100,756 to a 50% Downside Participation Rate with Cap Strategy and the Cap for the Term is 14%. Your Investment Base at the end of that Term is $100,000 ($100,756 - $756 in Daily Charges). You have not made a Performance Lock election.
At Final Market Close of Term | At Final Market Close of Term | |||
Rise or fall in Index |
+16% | 16% | ||
Increase or decrease percentage |
+14% (16% > 14% Cap) | 8% (50% of 16%) | ||
Dollar amount of increase or decrease |
+14,000 ($100,000 x 14%) | 8,000 ($100,000 x 8%) | ||
Strategy value at end of Term |
$114,000 ($100,000 + $14,000) | $92,000 ($100,000 - $8,000) |
Downside Participation Rate with Upside Participation Rate Strategy
In the absence of a Performance Lock election, here are the formulas that we use to calculate the Strategy value at the end of a Term of a Downside Participation Rate with Upside Participation Rate Strategy.
Strategy value at end of Term = Investment Base + dollar amount of increase or decrease
Dollar amount of increase or decrease = Investment Base (after taking Daily Charges into account) x increase or decrease percentage
Increase percentage = any rise in the Index over the Term x Upside Participation Rate
Decrease percentage = any fall in the Index over the Term x Downside Participation Rate
Example. At the beginning of a Term, you allocate $100,756 to a 50% Downside Participation Rate with Upside Participation Rate Strategy and the Upside Participation Rate for the Term is 75%. Your Investment Base at the end of that Term is $100,000 ($100,756 - $756 in Daily Charges). You have not made a Performance Lock election.
At Final Market Close of Term | At Final Market Close of Term | |||
Rise or fall in Index |
+16% | 16% | ||
Increase or decrease percentage |
+12% (75% of 16%) | 8% (50% of 16%) | ||
Dollar amount of increase or decrease |
+12,000 ($100,000 x 12%) | 8,000 ($100,000 x 8%) | ||
Strategy value at end of Term |
$112,000 ($100,000 + $12,000) | $92,000 ($100,000 - $8,000) |
Buffer with Upside Participation Rate Strategy
In the absence of a Performance Lock election, here are the formulas that we use to calculate the Strategy value at the end of a Term of a Buffer with Upside Participation Rate Strategy.
Strategy value at end of Term = Investment Base + dollar amount of increase or decrease
Dollar amount of increase or decrease = Investment Base (after taking Daily Charges into account) x increase or decrease percentage
Increase percentage = any rise in the Index over the Term x Upside Participation Rate
Decrease percentage for the Buffer with Upside Participation Rate Strategy = any fall in the Index over the Term to the extent it is greater than the Buffer
Example. At the beginning of a Term, you allocate $100,756 to 10% Buffer with Upside Participation Rate Strategy and the Upside Participation Rate for the Term is 130%. Your Investment Base at the end of that Term is $100,000 ($100,756 - $756 in Daily Charges). You have not made a Performance Lock election.
At Final Market Close of Term | At Final Market Close of Term | |||
Rise or fall in Index |
+16% | 16% | ||
Increase or decrease percentage |
+20.8% (130% of 16%) | 6% (-16% 10%) | ||
Dollar amount of increase or decrease |
+20,800 ($100,000 x 20.8%) | 6,000 ($100,000 x 6%) | ||
Strategy value at end of Term |
$120,800 ($100,000 + $20,800) | $94,000 ($100,000 - $6,000) |
36
Buffer with Cap Strategy
In the absence of a Performance Lock election, here are the formulas that we use to calculate the Strategy value at the end of a Term of 10% Buffer with Cap Strategy.
Strategy value at end of Term = Investment Base + dollar amount of increase or decrease
Dollar amount of increase or decrease = Investment Base x increase or decrease percentage
Increase percentage = any rise in the Index over the Term, but never more than the Cap
Decrease percentage = any fall in the Index over the Term to the extent it is greater than the Buffer
Example. At the beginning of a Term, you allocate $100,756 to 10% Buffer with Cap Strategy and the Cap for the Term is 13%. You do not take any withdrawals during that Term, Your Investment Base at the end of that Term is $100,000 ($100,756 - $756 in Daily Charges). You have not made a Performance Lock election.
At Final Market Close of Term |
At Final Market Close of Term | |||
Rise or fall in Index |
+16% | 16% | ||
Increase or decrease percentage |
+13% (16% > 13% Cap) | 6% (16% - 10%) | ||
Dollar amount of increase or decrease |
+13,000 ($100,000 x 13%) | 6,000 ($100,000 x 6%) | ||
Strategy value at end of Term |
$113,000 ($100,000 + $13,000) | $94,000 ($100, 000 - $6,000) |
Floor with Cap Strategy
In the absence of a Performance Lock election, here are the formulas that we use to calculate the Strategy value at the end of a Term of a Floor with Cap Strategy.
Strategy value at end of Term = Investment Base + dollar amount of increase or decrease
Dollar amount of increase or decrease = Investment Base x increase or decrease percentage
Increase percentage = any rise in the Index over the Term, but never more than the Cap
Decrease percentage = any fall in the Index over the Term, but never more than the Floor
Example. At the beginning of a Term, you allocate $100,756 to a -10% Floor with Cap Strategy and the Cap for the Term is 14%. You do not take any withdrawals during that Term. Your Investment Base at the end of that Term is $100,000 ($100,756 - $756 in Daily Charges). You have not made a Performance Lock election.
At Final Market Close of Term | At Final Market Close of Term | |||
Rise or fall in Index |
+16% | 16% | ||
Increase or decrease percentage |
+14% (16% > 14% Cap) | 10% (16% < -10%) | ||
Dollar amount of increase or decrease |
+14,000 ($100,000 x 14%) | 10,000 ($100,000 x 10%) | ||
Strategy value at end of Term |
$114,000 ($100,000 + $14,000) | $90,000 ($100, 000 - $10,000) |
37
INDEXED STRATEGY VALUE BEFORE END OF TERM
Before the final Market Day of a Term, unless you have made a Performance Lock election, the value of an Indexed Strategy is the Investment Base increased or decreased by the Daily Value Percentage. If you have made a Performance Lock election, then the normal rules set out in this section do not apply, and the value after the effective date of the Performance Lock election through the end of the Term is determined as described under Indexed Strategy Value After Performance Lock Election section below.
In the absence of a Performance Lock election, here are the formulas that we use to calculate the Strategy value before the end of a Term.
Strategy value before end of Term = Investment Base + dollar amount of increase or decrease
Dollar amount of increase or decrease = Investment Base (after Daily Charges are taken into account) x Daily Value Percentage
Daily Value Percentage = Net Option Price Amortized Option Cost Trading Cost
Net Option Price
The Net Option Price is one part of the Daily Value Percentage. The Net Option Price is based on the calculated prices of hypothetical options that represent the projected changes in the Index over the full Term. The mathematical model we use to price those options is described in the Option Prices section of this prospectus.
Net Option Price for Downside Participation Rate with Cap Strategy
For Downside Participation Rate with Cap Strategy, three option prices are included in the calculation of the Net Option Price.
| ATM Call Option Price, which represents the possible rise in the Index |
| OTM Call Option Price, which is subtracted in order to limit any rise in the Index by the Cap |
| ATM Put Option Price, which represents the possible fall in the Index and is multiplied by the Downside Participation Rate in order to reflect your share in any such fall. |
The Net Option Price as of a Market Close is a percentage equal to: (1) the ATM Call Option Price for the Market Close; minus (2) the OTM Call Option Price for the Market Close; and (3) minus the ATM Put Option Price for the Market Close multiplied by the Downside Participation Rate.
It is important to note that the Net Option Price will almost always be less than any rise in the Index because, when we calculate the Net Option Price, we subtract the ATM Put Option Price, and the ATM Put Option Price is always above zero due to the constant present potential for a fall in the Index before the end of the Term.
Net Option Price for Downside Participation Rate with Upside Participation Rate Strategy
For a Downside Participation Rate with Upside Participation Rate Strategy, two option prices are included in the calculation of the Net Option Price.
| ATM Call Option Price, which represents the possible rise in the Index and is multiplied by the Upside Participation Rate in order to reflect your share in any such rise |
| ATM Put Option Price, which represents the possible fall in the Index and is multiplied by the Downside Participation Rate in order to reflect your share in any such fall. |
The Net Option Price as of a Market Close is a percentage equal to: (1) the ATM Call Option Price for the Market Close multiplied by the Upside Participation Rate; minus (2) the ATM Put Option Price for the Market Close multiplied by the Downside Participation Rate
It is important to note that the Net Option Price will almost always be less than any rise in the Index because, when we calculate the Net Option Price, we subtract the ATM Put Option Price, and the ATM Put Option Price is always above zero due to the constant present potential for a fall in the Index before the end of the Term.
38
Net Option Price for Buffer with Upside Participation Rate Strategy
For a Buffer with Upside Participation Rate Strategy, two option prices are included in the calculation of the Net Option Price.
| ATM Call Option Price, which represents the possible rise in the Index and is multiplied by the Upside Participation Rate in order to reflect your share in any such rise |
| OTM Put Option Price, which represents the possible fall in the Index and is limited by the Buffer in order to reflect your share in any such fall. |
The Net Option Price as of a Market Close is a percentage equal to: (1) the ATM Call Option Price for the Market Close multiplied by the Upside Participation Rate; minus (2) the OTM Put Option Price for the Market Close
It is important to note that the Net Option Price will almost always be less than any rise in the Index because, when we calculate the Net Option Price, we subtract the OTM Put Option Price, and the OTM Put Option Price is always above zero due to the constant present potential for a fall in the Index before the end of the Term.
Net Option Price for a Floor with Cap Strategy
For a Floor with Cap Strategy, four option prices are included in the calculation of the Net Option Price.
| ATM Call Option Price, which represents the possible rise in the Index |
OTM Call Option Price, which is subtracted in order to limit any rise in the Index by the Cap
ATM Put Option Price, which is subtracted to represent the possible fall in the Index; and
| OTM Put Option Price, which is added to limit any fall in the Index to the Floor. |
The Net Option Price as of a Market Close is a percentage equal to: (1) the ATM Call Option Price for the Market Close; minus (2) the OTM Call Option Price for the Market Close; minus (3) the ATM Put Option Price for the Market Close; and plus (4) the OTM Put Option Price for the Market Close.
It is important to note that the Net Option Price will almost always be less than any rise in the Index because, when we calculate the Net Option Price, we subtract the amount by which the ATM Put Option Price exceeds the OTM Put Option Price, and the ATM Put Option Price always exceeds the OTM Put Option Price because the ATM Put Option Price represents the constant present potential for a fall in the Index before the end of the Term, while the OTM Put Option Price represents the lesser/included potential for a change in the Index of more than the -10% Floor..
Net Option Price for Buffer with Cap Strategy
For a Buffer with Cap Strategy, three option prices are included in the calculation of the Net Option Price.
| ATM Call Option Price, which represents the possible rise in the Index |
OTM Call Option Price, which is subtracted in order to limit any rise in the Index by the Cap
| OTM Put Option Price, which represents the possible fall in the Index and is limited by the Buffer in order to reflect your share in any such fall. |
The Net Option Price as of a Market Close is a percentage equal to: (1) the ATM Call Option Price for the Market Close; minus (2) the OTM Call Option Price for the Market Close; and minus (3) the OTM Put Option Price for the Market Close
It is important to note that the Net Option Price will almost always be less than any rise in the Index because, when we calculate the Net Option Price, we subtract the OTM Put Option Price, and the OTM Put Option Price is always above zero due to the constant present potential for a fall in the Index before the end of the Term.
Amortized Option Cost
The Amortized Option Cost is one part of the Daily Value Percentage. The Amortized Option Cost starts with the Net Option Price at the beginning of a Term, which is calculated using the formulas set out above. That Net Option Price is then multiplied by the time remaining in the Term as a percentage of the length of the Term.
39
The Amortized Option Cost as of a Market Close is a percentage equal to: (1) the Net Option Price for the Strategy at the beginning of the Term; multiplied by (2) the number of days remaining until the final Market Close of the Term divided by 365 for a one-year Term, by 730 for a two-year Term, or by 2,192 days for a six-year Term.
Trading Cost
The Trading Cost is one part of the Daily Value Percentage. The Trading Cost as of a Market Close is the estimated cost of selling the hypothetical options before the end of a Term. It is a percentage that reflects the average market difference between option average bid-ask prices and option bid prices.
Daily Value Percentage Examples
Examples. Here are four examples that show how the Daily Value Percentage formula works for Indexed Strategies with a 1-year Term. In each example, we calculate the Daily Value Percentage for the Market Close on day 90 of a one-year Term.
Assumptions
Option Price Assumptions | Price at Start of Term |
Price at Current Market Close |
||||||||||
ATM Call Option Price |
6.00 | % | 7.47 | % | ||||||||
OTM Call Option Price |
1.15 | % | 1.81 | % | ||||||||
ATM Put Option Price |
5.40 | % | 3.36 | % | ||||||||
OTM Put Option Price |
4.50 | % | 2.80 | % | ||||||||
Strategy Assumptions |
||||||||||||
Investment Base for each Strategy (after taking Daily Charges into account) |
$ | 100,000 | ||||||||||
Cap |
11 | % | ||||||||||
Upside Participation Rate |
75 | % | ||||||||||
Days remaining to last Market Day of Term |
275 | |||||||||||
Trading Cost Assumption |
0.15 | % |
Example 1: 50% Downside Participation Rate with Cap Strategy
Current ATM Call Option Price Current OTM Call Option Price |
5.66 | % | (7.47% 1.81% | ) | ||||
Current ATM Put Option Price x Downside Participation Rate |
1.68 | % | (50% of 3.36% | ) | ||||
|
|
|||||||
Net Option Price |
= 3.98 | % | ||||||
Initial ATM Call Option Price Initial OTM Call Option Price |
4.85 | % | (6.00% 1.15% | ) | ||||
Initial ATM Put Option Price x Downside Participation Rate |
2.70 | % | (50% of 5.40% | ) | ||||
|
|
|||||||
Net Option Cost |
= 2.15 | % | ||||||
Amortization Factor for days remaining to final Market Day of Term |
x 75.34 | % | (275 / 365 | ) | ||||
|
|
|||||||
Amortized Option Cost |
= 1.62 | % | ||||||
Net Option Price |
3.98 | % | ||||||
Amortized Option Cost |
1.62 | % | ||||||
Assumed Trading Cost |
0.15 | % | ||||||
|
|
|||||||
Daily Value Percentage |
= 2.21 | % | ||||||
Dollar amount of increase |
$ | 2,210 | ($ | 100,000 x 2.21% | ) | |||
Value of 50% Downside Participation Rate with Cap Strategy |
$ | 102,210 | ($ | 100,000 + $2,210 | ) |
40
Example 2: 50% Downside Participation Rate with Upside Participation Rate Strategy
Current ATM Call Option Price x Upside Participation Rate |
5.60 | % | (75% of 7.47% | ) | ||||
Current ATM Put Option Price x Downside Participation Rate |
1.68 | % | (50% of 3.36% | ) | ||||
|
|
|||||||
Net Option Price |
= 3.92 | % | ||||||
Initial ATM Call Option Price x Upside Participation Rate |
4.50 | % | (75% of 6.00% | ) | ||||
Initial ATM Put Option Price x Downside Participation Rate |
2.70 | % | (50% of 5.40% | ) | ||||
Net Option Cost |
= 1.80 | % | ||||||
Amortization Factor for days remaining to final Market Day of Term |
x 75.34 | % | (275 / 365 | ) | ||||
|
|
|||||||
Amortized Option Cost |
1.36 | % | ||||||
Net Option Price |
3.92 | % | ||||||
Amortized Option Cost |
1.36 | % | ||||||
Assumed Trading Cost |
0.15 | % | ||||||
|
|
|||||||
Daily Value Percentage |
= 2.41 | % | ||||||
|
|
|||||||
Increase as a dollar amount |
$ | 2,410 | ($ | 100,000 x 2.41% | ) | |||
Value of 50% Downside Participation Rate with Upside Participation Rate Strategy |
$ | 102,410 | ($ | 100,000 + $2,410 | ) |
Example 3: 10% Buffer with Cap Strategy
Current ATM Call Option Price Current OTM Call Option Price |
5.66 | % | (7.47% -1.81% | ) | ||||
Current OTM Put Option Price |
2.80 | % | ||||||
|
|
|||||||
Net Option Price |
= 2.86 | % | ||||||
Initial ATM Call Option Price Initial OTM Call Option Price |
4.85 | % | (6.00% -1.15% | ) | ||||
Initial OTM Put Option Price |
4.50 | % | ||||||
Net Option Cost |
= 0.35 | % | ||||||
Amortization Factor for days remaining to final Market Day of Term |
x 75.34 | % | (275 / 365 | ) | ||||
|
|
|||||||
Amortized Option Cost |
0.26 | % | ||||||
Net Option Price |
2.86 | % | ||||||
Amortized Option Cost |
0.26 | % | ||||||
Assumed Trading Cost |
0.15 | % | ||||||
|
|
|||||||
Daily Value Percentage |
= 2.45 | % | ||||||
|
|
|||||||
Increase as a dollar amount |
$ | 2,450 | ($ | 100,000 x 2.45% | ) | |||
Value of 10% Buffer with Cap Strategy |
$ | 102,450 | ($ | 100,000 + $2,450 | ) |
Example 4: -10% Floor with Cap Strategy
Current ATM Call Option Price Current OTM Call Option Price |
5.66 | % | (7.47% 1.81% | ) | ||||
(Current ATM Put Option Price Current OTM Put Option Price) |
-0.56 | % | (3.36% - 2.80% | ) | ||||
|
|
|||||||
Net Option Price |
= 5.10 | % | ||||||
Initial ATM Call Option Price Initial OTM Call Option Price |
4.85 | % | (6.00% 1.15% | ) | ||||
- (Initial ATM Put Option Price Initial OTM Put Option Price) |
0.90 | % | (5.40% - 4.50% | ) | ||||
|
|
|||||||
Net Option Cost |
= 3.95 | % | ||||||
X Amortization Factor for days remaining to final Market Day of Term |
x 75.34 | % | (275 / 365 | ) | ||||
|
|
|||||||
Amortized Option Cost |
= 2.98 | % | ||||||
Net Option Price |
5.10 | % | ||||||
Amortized Option Cost |
2.98 | % | ||||||
Assumed Trading Cost |
0.15 | % | ||||||
|
|
|||||||
Daily Value Percentage |
= 1.97 | % | ||||||
Dollar amount of increase |
$ | 1,970 | ($ | 100,000 x 1.970% | ) | |||
Value of -10% Floor with Cap Strategy |
$ | 101,970 | ($ | 100,000 + $1,970 | ) |
41
Examples. Here is an example that shows how the Daily Value Percentage formula works with a six-year 10% Buffer with Upside Participation Rate Strategy. In this example, we calculate the Daily Value Percentage for the Market Close on day 2010 of a six-year Term.
Assumptions for Example 5
Option Price Assumptions | Price at Start of Term |
Price at Current Market Close |
||||||||||
ATM Call Option Price |
20.59 | % | 18.04 | % | ||||||||
OTM Put Option Price |
15.47 | % | 16.35 | % | ||||||||
Strategy Assumptions |
||||||||||||
Investment Base for each Strategy (after taking Daily Charges into account) |
$ | 100,000 | ||||||||||
Upside Participation Rate for six-year Term |
130 | % | ||||||||||
Days remaining to last Market Day of six-year Term |
182 | |||||||||||
Trading Cost Assumption |
2.03 | % |
Example 5: 10% Buffer with Upside Participation Rate Strategy
Current ATM Call Option Price x Upside Participation Rate |
23.45 | % | (130% of 18.04% | ) | ||||
Current OTM Put Option Price |
16.35 | % | ||||||
|
|
|||||||
Net Option Price |
= 7.10 | % | ||||||
Initial ATM Call Option Price x Upside Participation Rate |
26.77 | % | (130% of 20.59% | ) | ||||
Initial OTM Put Option Price |
15.47 | % | ||||||
Net Option Cost |
= 11.30 | % | ||||||
Amortization Factor for days remaining to final Market Day of Term |
x 8.30 | % | (182 / 2192 | ) | ||||
|
|
|||||||
Amortized Option Cost |
0.94 | % | ||||||
Net Option Price |
7.10 | % | ||||||
Amortized Option Cost |
0.94 | % | ||||||
Assumed Trading Cost |
2.03 | % | ||||||
|
|
|||||||
Daily Value Percentage |
= 4.13 | % | ||||||
|
|
|||||||
Increase as a dollar amount |
$ | 4,130 | ($ | 100,000 x 4.13% | ) | |||
Value of 10% Buffer with Upside Participation Rate Strategy |
$ | 104,130 | ($ | 100,000 + $4,130 | ) |
42
Maximum Loss Before the End of a Term
If you Surrender your Contract or take a withdrawal before the end of a Term, there is no set maximum loss because the Indexed Strategy value is
determined using the Daily Value Percentage. The loss on a Floor Strategy may exceed the Floor, the loss on a Downside Participation Rate Strategy may exceed the 50% Downside Participation Rate, and a Buffer Strategy may not receive the benefit of the 10% Buffer, because the use of the Daily Value Percentage means that the Amortized Option Cost and Trading Cost are subtracted from the Strategy value. The Amortized Option Cost and Trading Cost are determined each time the Daily Value Percentage is calculated. As a result, in extreme circumstances, the total loss for an Indexed Strategy could be 100%, meaning that you would suffer a complete loss of your principal and any prior earnings.
INDEXED STRATEGY VALUE AFTER PERFORMANCE LOCK ELECTION
For an S&P 500 Strategy or a First Trust Barclays Edge Strategy, you may make a Performance Lock election for a Term that starts after the date of this prospectus, If you do so, then the normal rules described in the Indexed Strategy Value at End of Term section and the Indexed Strategy Value Before End of Term section do not apply. Instead, beginning on the second Market Close following the receipt of the Performance Lock election, the Daily Value Percentage used to calculate the Strategy value through the end of the Term is locked in. However, the Daily Charge will continue to be assessed against the Investment Base. Note: A Performance Lock election is not available for Contracts issued in Missouri.
If you make a Performance Lock election, here are the formulas that we use to calculate the Strategy value through the end of the Term.
Strategy value before or at end of Term = Investment Base + dollar amount of increase or decrease
Dollar amount of increase or decrease = Investment Base x locked Daily Value Percentage
Locked Daily Value Percentage = Net Option Price Amortized Option Cost Trading Cost, all as determined at the second Market Close following receipt of the Performance Lock election
Performance Lock Examples
Examples. Here are four examples that show how the Performance Lock election works for S&P 500 or First Trust Barclays Edge Strategies.
Assumptions
Option Price Assumptions |
Price at Start of Term | Price on Lock Effective Date |
||||||
ATM Call Option Price |
6.00 | % | 7.47 | % | ||||
OTM Call Option Price |
1.15 | % | 1.81 | % | ||||
ATM Put Option Price |
5.40 | % | 3.36 | % | ||||
OTM Put Option Price |
4.50 | % | 2.80 | % | ||||
Strategy Assumptions |
||||||||
Initial Investment Base for each Strategy (after taking Daily Charges into account) |
$ | 100,000 | ||||||
Cap for one-year Term |
11 | % | ||||||
Upside Participation Rate for six-year Term |
130 | % | ||||||
Days remaining to last Market Day of six-year Term |
182 | |||||||
Trading Cost Assumption |
2.03 | % |
43
Example 1: 50% Downside Participation Rate with Cap Strategy
Lock effective date ATM Call Option Price OTM Call Option Price |
5.66 | % | (7.47% 1.81% | ) | ||||
(Lock effective date ATM Put Option Price x Downside Participation Rate) |
1.68 | % | (50% of 3.36% | ) | ||||
Net Option Price on Lock effective date |
= 3.98 | % | ||||||
Initial ATM Call Option Price Initial OTM Call Option Price |
4.85 | % | (6.00% 1.15% | ) | ||||
(Initial ATM Put Option Price x Downside Participation Rate) |
2.70 | % | (50% of 5.40% | ) | ||||
Net Option Cost |
= 2.15 | % | ||||||
Amortization Factor for days remaining from Lock effective date to final Market Day of Term |
x 75.34 | % | (275 / 365 | ) | ||||
Amortized Option Cost on Lock effective date |
= 1.62 | % | ||||||
Net Option Price |
3.98 | % | ||||||
Amortized Option Cost |
1.62 | % | ||||||
Assumed Trading Cost |
0.15 | % | ||||||
Locked Daily Value Percentage |
= 2.21 | % | ||||||
Dollar amount of increase at Term end |
$ | 2,210 | ($ | 100,000 x 2.21% | ) | |||
Value of 50% Downside Participation Rate with Cap Strategy at Term end |
$ | 102,210 | ($ | 100,000 + $2,210 | ) |
Example 2: 50% Downside Participation Rate with Upside Participation Rate Strategy
Lock effective date ATM Call Option Price x Upside Participation Rate |
5.60 | % | (75% of 7.47%) | |||||
(Lock effective date ATM Put Option Price x Downside Participation Rate) |
1.68 | % | (50% of 3.36%) | |||||
Net Option Price on Lock Effective Date |
= 3.92 | % | ||||||
Initial ATM Call Option Price x Upside Participation Rate |
4.50 | % | (75% of 6.00%) | |||||
(Initial ATM Put Option Price x Downside Participation Rate) |
2.70 | % | (50% of 5.40% | ) | ||||
Net Option Cost |
= 1.80 | % | ||||||
Amortization Factor for days remaining to final Market Day of Term |
x 75.34 | % | (275 / 365 | ) | ||||
Amortized Option Cost on Lock effective date |
1.36 | % | ||||||
Net Option Price |
3.92 | % | ||||||
Amortized Option Cost |
1.36 | % | ||||||
Assumed Trading Cost |
0.15 | % | ||||||
Locked Daily Value Percentage |
= 2.41 | % | ||||||
Increase as a dollar amount as Term end |
$ | 2,410 | ($ | 100,000 x 2.41% | ) | |||
Value of 50% Downside Participation Rate with Upside Participation Rate Strategy at Term end |
$ | 102,410 | ($ | 100,000 + $2,410 | ) |
Example 3: 10% Buffer with Cap Strategy
Lock effective date ATM Call Option Price OTM Call Option Price |
5.66 | % | (7.47%-1.81% | ) | ||||
Lock effective date OTM Put Option Price |
2.80 | % | ||||||
Net Option Price on Lock effective date |
= 2.86 | % | ||||||
Initial ATM Call Option Price Initial OTM Call Option Price |
4.85 | % | (6.00%-1.15% | ) | ||||
Initial OTM Put Option Price |
4.50 | % | ||||||
Net Option Cost |
= 0.35 | % | ||||||
Amortization Factor for days remaining from Lock effective date to final Market Day of Term |
x 75.34 | % | (275 / 365 | ) |
44
Amortized Option Cost on Lock effective date |
0.26 | % | ||||||
Net Option Price |
2.86 | % | ||||||
Amortized Option Cost |
0.26 | % | ||||||
Assumed Trading Cost |
0.15 | % | ||||||
Locked Daily Value Percentage |
= 2.45 | % | ||||||
|
|
|||||||
Dollar amount of increase at Term end |
$ | 2,450 | ($ | 100,000 x 2.45% | ) | |||
Value of 10% Buffer with Cap Strategy at Term end |
$ | 102,450 | ($ | 100,000 + $2,450 | ) |
Example 4: -10% Floor with Cap Strategy
Lock effective date ATM Call Option Price OTM Call Option Price |
5.66 | % | (7.47% 1.81% | ) | ||||
(Lock effective date ATM Put Option Price OTM Put Option Price) |
0.56 | % | (3.36% 2.80% | ) | ||||
Net Option Price on Lock effective date |
= 5.10 | % | ||||||
Initial ATM Call Option Price Initial OTM Call Option Price |
4.85 | % | (6.00% 1.15% | ) | ||||
- (Initial ATM Put Option Price Initial OTM Put Option Price) |
0.90 | % | (5.40% - 4.50% | ) | ||||
Net Option Cost |
= 3.95 | % | ||||||
Amortization Factor for days remaining from Lock effective date to final Market Day of Term |
x 75.34 | % | (275 / 365 | ) | ||||
Amortized Option Cost on Lock effective date |
= 2.98 | % | ||||||
Net Option Price |
5.10 | % | ||||||
Amortized Option Cost |
2.98 | % | ||||||
Assumed Trading Cost |
0.15 | % | ||||||
Locked Daily Value Percentage |
= 1.97 | % | ||||||
Dollar amount of increase at Terme end |
$ | 1,970 | ($ | 100,000 x 1.970% | ) | |||
Value of -10% Floor with Cap Strategy at Term end |
$ | 101,970 | ($ | 100,000 + $1,970 | ) |
Examples. Here is an example that shows how the Performance Lock election works with a six-year 10% Buffer with Upside Participation Rate Strategy. In this example, we assume that the Performance Lock election is effective on day 2010 of a six-year Term.
Assumptions for Example 5
Option Price Assumptions | Price at Start of Term |
Price on Lock Effective Date |
||||||||||
ATM Call Option Price |
20.59 | % | 18.04 | % | ||||||||
OTM Put Option Price |
15.47 | % | 16.35 | % | ||||||||
Strategy Assumptions |
||||||||||||
Investment Base for each Strategy (after taking Daily Charges into account) |
$ | 100,000 | ||||||||||
Upside Participation Rate for six-year Term |
130 | % | ||||||||||
Days remaining to last Market Day of six-year Term |
182 | |||||||||||
Trading Cost Assumption |
2.03 | % |
Example 5: 10% Buffer with Upside Participation Rate Indexed Strategy
Lock Effective Date ATM Call Option Price x Upside Participation Rate |
23.45 | % | (130% of 18.04% | ) | ||||
Lock Effective Date OTM Put Option Price |
16.35 | % | ||||||
|
|
|||||||
Net Option Price on Lock effective date |
= 7.10 | % | ||||||
Initial ATM Call Option Price x Upside Participation Rate |
26.77 | % | (130% of 20.59% | ) | ||||
Initial OTM Put Option Price |
15.47 | % | ||||||
Net Option Cost |
= 11.30 | % | ||||||
Amortization Factor for days remaining from Lock effective date to final Market Day of Term |
x 8.30 | % | (182 / 2192 | ) | ||||
|
|
|||||||
Amortized Option Cost on Lock effective date |
0.94 | % | ||||||
Net Option Price |
7.10 | % | ||||||
Amortized Option Cost |
0.94 | % | ||||||
Assumed Trading Cost |
2.03 | % | ||||||
|
|
|||||||
Locked Daily Value Percentage |
= 4.13 | % | ||||||
|
|
|||||||
Increase as a dollar amount at Term end |
$ | 4,130 | ($ | 100,000 x 4.13% | ) | |||
Value of 10% Buffer with Upside Participation Rate Strategy at Term end |
$ | 104,130 | ($ | 100,000 + $4,130 | ) |
45
You may purchase a Contract only through a registered representative of a broker-dealer that has a selling agreement with our affiliated underwriter, MM Ascend Life Investor Services, LLC.
Any Owner or Annuitant must be age 80 or younger on the Contract Effective Date. To determine eligibility, we will use the persons age on his/her last birthday. We may make exceptions with respect to the maximum issue age in our discretion.
The Contract is not available in all states. To find out if it is available in the state where you live, ask your registered representative. The Contract may not be available for purchase during certain periods. There are a number of reasons why the Contract periodically may not be available, including that we want to limit the volume of sales of the Contract. You may wish to speak to your registered representative about how this may affect your purchase. For example, in order to purchase the Contract, you may be required to submit your application prior to a specific date. In that case, if there is a delay because your application is incomplete or otherwise not in good order, you might not be able to purchase the Contract. Your broker-dealer may impose conditions on the purchase of the Contract, such as a lower maximum issue age, than we or other selling firms impose. We reserve the right to reject any application at our discretion. We also reserve the right to discontinue the sale of the Contracts at any time.
Purchase Payments
The Contract is a modified single premium annuity contract. This means you may make one or more Purchase Payments during the purchase payment period. The purchase payment period begins on the Contract Effective Date. It will end two months after the Contract Effective Date.
We must receive your initial Purchase Payment on or before the Contract Effective Date. We must receive each additional Purchase Payment on or before the last day of the purchase payment period. We will not accept any Purchase Payment that we receive after the date that the Contract is cancelled or Surrendered or after a death for which a Death Benefit is payable.
The initial Purchase Payment must be at least $25,000. Each additional Purchase Payment must be at least $10,000. You will need our prior approval if you want to make a Purchase Payment(s) of more than $1,000,000.
We reserve the right to refuse a Purchase Payment made in the form of a personal check in excess of $100,000. We may accept a Purchase Payment over $100,000 made in other forms, such as EFT/wire transfers, or certified checks or other checks written by financial institutions. We will not accept a Purchase Payment(s) made with cash, money orders, or travelers checks.
Exchanges, Transfers, or Rollovers
If you own an annuity or tax-qualified account, you may be able to exchange it for an Index Summit 6 Pro annuity, directly transfer it to an Index Summit 6 Pro annuity, or roll it over to an Index Summit 6 Pro annuity without paying taxes. Before you do, compare the benefits, features, and costs of each annuity or account. You may pay an early withdrawal charge under the old annuity or account. You may pay an early withdrawal charge if you later take withdrawals from your Index Summit 6 Pro annuity. Please note that some financial professionals may have a financial incentive to offer this Contract in place of the one the investor already owns. Ask your registered representative whether an exchange, transfer, or rollover would be advantageous, based on the features, benefits, and charges of the Index Summit 6 Pro annuity.
If you purchase your Contract with an exchange, transfer, or rollover, a delay in processing the exchange, transfer, or rollover may delay the issuance of your new Contract or prevent the application of additional Purchase Payments to your existing Contract.
You should only exchange your existing contract for this Contract if you determine after comparing the features, fees, and risks of both contracts that it is preferable for you to purchase this Contract rather than continuing to own your existing contract.
46
Application of Purchase Payments
Each Purchase Payment will be held in the Purchase Payment Account until it is applied to an Indexed Strategy on a Strategy Application Date. On each Strategy Application Date, we will apply the then current balance of the Purchase Payment Account to the Indexed Strategies you selected.
We will credit interest daily on amounts held in the Purchase Payment Account at the annual effective rate set out in your Contract. This rate will be at least 1%.
In certain states, we are required to give back your Purchase Payment(s) if you decide to cancel your Contract during the free look period. If we are required by law to refund your Purchase Payment(s), we reserve the right to hold your Purchase Payment(s) in the Purchase Payment Account until the first Strategy Application Date on or after the end of the free look period. If we do so and you cancel your Contract before that Strategy Application Date, we will refund your Purchase Payment(s) but you will forfeit any interest credited to the Purchase Payment Account.
Purchase Payment Account Value
On any day, the value of the Purchase Payment Account is equal to:
| Purchase Payments received by us plus interest earned daily; minus |
| the premium tax or other tax that may apply to the Purchase Payments; and minus |
| each withdrawal and related Early Withdrawal Charge taken from the Purchase Payment Account since the last Strategy Application Date. |
Unforeseen Processing Delays
We are exposed to risks related to natural and man-made disasters and catastrophes, such as (but not limited to) storms, fires, floods, earthquakes, public health crises, malicious acts, and terrorist acts, any of which could adversely affect our ability to conduct business. A natural or man-made disaster or catastrophe, including a pandemic (such as COVID-19), could affect the ability or willingness of our employees or the employees of our service providers to perform their job responsibilities. While many of our employees and the employees of our service providers are able to work remotely, those remote work arrangements may result in our business operations being less efficient than under normal circumstances and could lead to delays in our processing of contract-related transactions, including orders from contract owners. Catastrophic events may negatively affect the computer and other systems on which we rely, impact our ability to calculate values under your Contract, or have other possible negative impacts. There can be no assurance that our service providers will be able to successfully avoid negative impacts associated with natural and man-made disasters and catastrophes.
A processing delay will not affect the effective date as of which we process transactions, including orders from contract owners, the date that a Term begins or ends, or the values used to process the transaction.
You make your initial selection of Indexed Strategies in your purchase application. Your initial selection is set out on your Contract Specifications Page.
Your initial selection will also apply to each subsequent Purchase Payment. If you wish to change your selection for a specific Purchase Payment, we must receive a Request in Good Order that identifies the Indexed Strategies you are selecting for that Purchase Payment before the Strategy Application Date that applies to that Purchase Payment.
When you select an Indexed Strategy, you must also indicate the percentage of the Purchase Payment that you wish to allocate to that Indexed Strategy. All allocations must be in whole percentages that total 100%. We reserve the right to round amounts up or down to make whole percentages, and to reduce or increase amounts proportionally in order to total 100%.
Currently there are no limitations on the amounts that may be applied to an Indexed Strategy.
The S&P 500 6-year 10% Buffer with Upside Participation Rate Strategy is only be available for Terms that begin in the first Contract Year.
We may establish minimum and maximum amounts or percentages that may be applied to a given Indexed Strategy for any future Term in our discretion. We will notify you of any such minimum or maximum. We may limit the availability of a Strategy for a Term that would extend beyond the Annuity Payout Initiation Date. All Strategies may not be available in all states.
47
STRATEGY SELECTIONS AT TERM END
At the end of a Term, you may choose to reallocate your money among the Indexed Strategies or you may choose to take no action. If you do not send us a reallocation request, your current allocations will automatically continue in the new Term as long as the same Index Strategies are available.
Reallocations
At the end of a Term, you may reallocate the ending values of the Indexed Strategies for that Term among the available Strategies. You can only reallocate amounts from one Indexed Strategy to another at the end of the Term for which such amount is being held. You cannot make a reallocation at any other time.
We will send you written notice at least 30 days before the end of a Term to provide you with the opportunity to make a reallocation. We must receive your Request in Good Order for a reallocation on or before the last day of the Term. For example, if the end of a Term falls on a weekend, we must receive your request on the last Market Day before that weekend.
Continuing Allocations
You do not need to take any action if you want to continue your current allocations and all of your strategies are available for the next Term. If you do not send us a reallocation request, then we will automatically apply the ending value of each Indexed Strategy to a new Term of that same Strategy.
Unavailable Strategies
Other than the S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate Indexed Strategy, an Indexed Strategy may be unavailable for the next Term because we are no longer offering that Strategy or we have set a minimum or maximum for that Strategy. The S&P 500 6-year 10% Buffer with Upside Participation Rate will not be available for Terms that begin after the first Contract Year.
When an Indexed Strategy is unavailable for the next Term, you may choose to reallocate the funds held in that Strategy.
If you take no action and do not send us a reallocation request, then any amount that cannot be applied to that Indexed Strategy for the next Term will be applied as follows:
1) | if the Strategy is a Downside Participation Rate Strategy, to another Indexed Strategy that uses the same index as the prior Indexed Strategy, has a Term that is no longer than the prior Indexed Strategy, has a Downside Participation Rate that is no greater than the prior Indexed Strategy, and has the same or most comparable positive return factors; or |
2) | if the Strategy is a Floor Strategy, to another Indexed Strategy that uses the same index as the prior Indexed Strategy, has a Term that is no longer than the prior Indexed Strategy, has a Floor that is no more negative than the prior Indexed Strategy, and has the same or most comparable positive return factors; or |
3) | if the Strategy is a Buffer Strategy, to another Indexed Strategy that uses the same index as the prior Indexed Strategy, has a Term that is no longer than the prior Indexed Strategy, has a Buffer that is at least as large as the prior Indexed Strategy, and has the same or most comparable positive return factors; or |
4) | to the S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate Indexed Strategy. |
Surrender or Withdrawal at Term End
At the end of a Term, you may choose to Surrender your Contract or to take a withdrawal from your Contract. You may do so for any reason, including dissatisfaction with the available Indexed Strategies. An Early Withdrawal Charge may apply. In addition, there may be tax consequences if you Surrender your Contract or take a withdrawal. You should seek advice on tax questions based on your particular circumstances from a tax advisor.
Contract values calculated at the end of a Term will reflect the applicable Strategy values and any Early Withdrawal Charge that applies upon Surrender or to your withdrawal. The value of an Indexed Strategy at the end of the Term will not reflect any Daily Value Percentage because it is calculated based on the rise or fall of the applicable Index over the Term.
Limitations
Reallocations must be in whole percentages that total 100%. We reserve the right to round amounts up or down to make whole percentages, and to reduce or increase amounts proportionally in order to total 100%.
Any reallocation or continuing allocation will be subject to Strategy availability, minimums and maximums. Currently there are no limitations on the amounts that may be applied to any single Indexed Strategy. We may establish minimum and maximum amounts or percentages that may be applied to a given Indexed Strategy for any future Term in our discretion. We will notify you of any such minimum or maximum.
48
The new Term of each Strategy is subject to the Cap or Upside Participation Rate in effect for that Strategy for that new Term. For example, the Upside Participation Rate for an Indexed Strategy for a new Term may be different than the Upside Participation Rate for that Indexed Strategy for the Term that is ending. The Downside Participation Rate, Floor or Buffer will not change from Term to Term.
Availability of Strategies
We will send you a written notice at least 30 days before the end of each Term with information about the Strategies that will be available for the next Term. At least 10 days before the next Term starts, we will post the Caps and Upside Participation Rates that will apply for the next Term on our website (www.mmascend.com/RILArates).
The S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate Indexed Strategy will always be available. We are not obligated to offer any other particular Indexed Strategy. At the end of a Term, we can add or stop offering any other Indexed Strategy at our discretion. We reserve the right to limit the availability of any other Indexed Strategy for a Term that would extend beyond the Annuity Payout Initiation Date. All Indexed Strategies may not be available in all states.
If we intend to add or stop offering an Indexed Strategy at the end of a Term, we will send you a notification at least 30 days before the end of the Term to provide you with the opportunity to make a reallocation. If funds are held in an Indexed Strategy that will no longer be available after the end of a Term, the funds will remain in that Strategy until the end of that Term.
Default Strategy
At the end of a Term of a 1-year or 2-year Strategy, to the extent any amount cannot be applied to a given Indexed Strategy for the next Term because that Strategy is no longer available or the amount is under the minimum or over the maximum for that Strategy for the new Term, we will apply the amount to the default Strategy unless you send us a request to reallocate that amount. The default Strategy will be the S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate Indexed Strategy. For example, if a given Indexed Strategy with an ending value of $73,000 is no longer available, we will apply the $73,000 to the default Strategy for the next Term unless you send us a request to reallocate that $73,000. At the end of a Term of the 6-year Buffer Strategy, we will apply the amount to the S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy unless you send us a request to reallocate that amount.
If the amount to be applied exceeds the maximum, then only the excess amount will be applied to the default Strategy. For example, if the maximum amount for an Indexed Strategy is $50,000 and the amount to be applied is $54,000, then we will apply the excess $4,000 to the default Strategy for the next Term unless you send us a request to reallocate that $4,000.
We must receive your Request in Good Order for a reallocation on or before the last day of the Term. For example, if the end of a Term falls on a weekend, we must receive your request on the last Market Day before that weekend.
Surrender
You may Surrender your Contract at any time before the earlier of: (1) the Annuity Payout Initiation Date; or (2) a death for which a Death Benefit is payable. The right to Surrender may be restricted if your Contract is purchased under an employer plan subject to IRC Section 401 (pension, profit sharing, and 401(k) plans), IRC Section 403(b) (tax-sheltered annuity plans), or IRC Section 457(b) (governmental deferred compensation plans).
A Surrender must be made by a Request in Good Order. The amount paid upon Surrender is the Surrender Value. If you Surrender your Contract, the Contract terminates.
Withdrawals
You may take a withdrawal from your Contract at any time before the earliest of: (1) the Annuity Payout Initiation Date; (2) a death for which a Death Benefit is payable; or (3) the date that this Contract is Surrendered. The right to withdraw may be restricted if your Contract is purchased under an employer plan subject to IRC Section 401 (pension, profit sharing, and 401(k) plans), IRC Section 403(b) (tax-sheltered annuity plans), or IRC Section 457(b) (governmental deferred compensation plans).
A withdrawal must be made by a Request in Good Order. The amount of any withdrawal must be at least $500. If the withdrawal would reduce the Account Value to less than the minimum value of $5,000, we will treat the withdrawal request as a request to withdraw the maximum amount that may be taken without reducing your Account Value to less than $5,000.
49
We will withdraw funds from your Account Value as of the date on which we receive your Request in Good Order or any later specified effective date. You may designate the Indexed Strategy or Strategies from which a withdrawal will be taken by a Request in Good Order prior to the date of the withdrawal. If you do not make a designation, we will take the withdrawal from the Indexed Strategies in the following order:
| first from the Purchase Payment Account; and |
| then proportionally from Indexed Strategies having the shortest Term. |
For Contracts issued in Missouri, amounts taken from Indexed Strategies will be proportional without regard to Term length.
Effect of Withdrawals
A withdrawal reduces the Account Value, which in turn reduces the amount payable upon Surrender, applied to the Annuity Payout Benefit, or payable as the Death Benefit.
If an Early Withdrawal Charge applies to your withdrawal, you will receive the amount that you requested, and your Account Value will be reduced by the amount you receive plus the amount needed to pay the Early Withdrawal Charge. A withdrawal from an Indexed Strategy other than at the end of a Term also reduces the Investment Base used to calculate the Strategy value later in the Term. The reduction in the Investment Base for a withdrawal and any related Early Withdrawal Charge is proportional to the reduction in the Strategy value.
Automatic Withdrawals
You may elect to automatically withdraw money from your Contract under any automatic withdrawal program that we offer. Your Account Value must be at least $10,000 in order to make an automatic withdrawal election. The minimum amount of each automatic withdrawal payment is $100. Automatic withdrawals will be taken from the Purchase Payment Account and Indexed Strategies of your Contract in the same order as any other withdrawal.
Subject to the terms and conditions of the automatic withdrawal program, you may begin or discontinue automatic withdrawals at any time. You must give us at least 30 days notice to change any automatic withdrawal instructions that are currently in place. Any request to begin, discontinue or change automatic withdrawals must be a Request in Good Order. We reserve the right to discontinue offering automatic withdrawals at any time.
Currently, we do not charge a fee to participate in an automatic withdrawal program. However, we reserve the right to impose an annual fee in such amount as we may then determine to be reasonable for participation in the automatic withdrawal program. If imposed, the fee will not exceed $30 annually.
Before electing an automatic withdrawal, you should consult with a financial advisor.
| Automatic withdrawals are similar to starting Annuity Payout Benefit payments, but will result in different taxation of payments and potentially a different amount of total payments over the life of your Contract. |
| Automatic withdrawals during a Term of an Indexed Strategy will systematically reduce the Investment Base, which will reduce any subsequent increase in the Strategy value due to a positive Daily Value Percentage during that Term or a rise in the applicable Index at the end of that Term. Such reductions could be significant. |
| Automatic withdrawals will reduce the amount available under the Free Withdrawal Allowance described below. |
| Unless a waiver applies, an Early Withdrawal Charge may apply to an automatic withdrawal during the Early Withdrawal Charge period. |
| The value of an Indexed Strategy on an automatic withdrawal date will reflect the Daily Value Percentage on that date. |
Exchanges, Transfers, and Rollovers
An amount paid on a withdrawal or Surrender may be paid to or for another annuity or tax-qualified account in a tax-free exchange, transfer, or rollover to the extent allowed by federal tax law.
AMORTIZED OPTION COST AND TRADING COST USED TO CALCULATE DAILY VALUE PERCENTAGE
The Daily Value Percentage is used to determine the value of an Indexed Strategy before the end of a Term, and a locked Daily Value Percentage is used to determine the value of an Indexed Strategy for the balance of a Term if you have made a Performance Lock election. The Daily Value Percentage is calculated by subtracting the Amortized Option Cost and Trading Cost from the Net Option Price. The Amortized Option Cost and Trading Cost are charges for unwinding the investment before the end of a Term. These charges reduce the Indexed Strategy value. When the Contract is Surrendered or a withdrawal is taken before the end of a Term, or when you make a Performance Lock election, the reduction in Indexed
50
Strategy value due to the Amortized Option Cost and Trading Cost may cause a loss to exceed the -10% Floor or 50% Downside Participation Rate, and may eliminate the benefit of the 10% Buffer. The Amortized Option Cost and Trading Cost are determined each time the Daily Value Percentage is calculated or when a Performance Lock election is made. As a result, in extreme circumstances, the total loss for an Indexed Strategy could be 100%, meaning that you would suffer a complete loss of your principal and any prior earnings. For more information on the Amortized Option Cost and Trading Cost, please see the Indexed Strategy Value Before End of Term section beginning on page [ ].
We impose a Daily Charge on each Indexed Strategy to reimburse us for contract sales expenses, including commissions and other distribution, promotion, and acquisition expenses, and to help us maximize Indexed Strategy Caps and Participation Rates. The Daily Charge is calculated using a daily rate that compounds at 0.75% per year.
The Daily Charge is calculated as a percentage of the remaining Investment Base of the Indexed Strategy and deducted daily.
We impose an Early Withdrawal Charge to reimburse us for contract sales expenses, including commissions and other distribution, promotion, and acquisition expenses, and to allow us to invest assets for a longer duration, which supports higher Caps and Upside Participation Rates.
The Early Withdrawal Charge applies if, during the first six Contract Years, you take a withdrawal from your Contract or Surrender it. After that, the Early Withdrawal Charge does not apply.
During the first six Contract Years, the Early Withdrawal Charge applies to each withdrawal, including withdrawals under an automatic withdrawal program and withdrawals taken to satisfy a required distribution. The Early Withdrawal Charge does not apply to Death Benefit payments or Annuity Payout Benefit payments.
An Early Withdrawal Charge reduces your Account Value.
The Early Withdrawal Charge is equal to the amount that is subject to the charge multiplied by the Early Withdrawal Charge rate.
| If you take a withdrawal from your Contract, the amount subject to the charge is the amount you withdraw, which includes any amount needed to pay the Early Withdrawal Charge. This means that at your direction either we will subtract the Early Withdrawal Charge from amount paid to you or we will increase the amount withdrawn as needed to cover the charge. |
| If you Surrender your Contract, the amount subject to the charge is your Account Value. |
| The amount subject to the charge will not include the Free Withdrawal Allowance or the amount, if any, that qualifies for a waiver as described below. |
The Early Withdrawal Charge rate depends on how long you own your Contract. The rate schedule is set out below.
Contract Year |
1 | 2 | 3 | 4 | 5 | 6 | 7+ | |||||||||||||||||||||
Early Withdrawal Charge Rate |
9 | % | 8 | % | 7 | % | 6 | % | 5 | % | 4 | % | 0 | % |
Example for Surrender. You Surrender your Contract in Contract Year 6 when your Account Value is $100,000. You have already used your Free Withdrawal Allowance for the year and no other exception applies. We take an Early Withdrawal Charge of $4,000 ($100,000 x 4%) and you receive $96,000.
Example for Withdrawal. You withdraw $12,000 from your Contract in Contract Year 6. You have already used your Free Withdrawal Allowance for the year and no other exception applies. We use the following formula to calculate the Early Withdrawal Charge.
(Requested withdrawal x EWC rate) / (1.00 - EWC rate) = Early Withdrawal Charge
($12,000 x 4%) / (1.00 - 0.04) = $480 / 0.96 = $500
We take the Early Withdrawal Charge of $500, you receive $12,000, and your Account Value is reduced by $12,500.
Note. If the amount subject to the Early Withdrawal Charge included only the amount you withdrew, the charge would have been $480. Because the amount subject to the Early Withdrawal charge also included the amount needed to pay the charge, the actual charge is $500.
51
Free Withdrawal Allowance
The Free Withdrawal Allowance lets you withdraw some money from your Contract without the imposition of the Early Withdrawal Charge. For the first Contract Year, the Free Withdrawal Allowance is an amount equal to 10% of the total Purchase Payments received by us. For each subsequent Contract Year, the Free Withdrawal Allowance is equal to 10% of the Account Value as of the most recent Contract Anniversary. The Free Withdrawal Allowance is non-cumulative and you may not carry over any unused portion to other Contract Years.
For qualified annuities, the Free Withdrawal Allowance will be large enough to cover your required minimum distribution to age 93. However, if you have used your Free Withdrawal Allowance to facilitate a transfer or rollover, then an Early Withdrawal Charge may apply to a required minimum distribution.
Example. Your Account Value as of the end of Contract Year 3 is $200,000. Your Free Withdrawal Allowance for Contract Year 4 is $20,000 (10% of $200,000). If you take a withdrawal of $50,000 at the beginning of Contract Year 4, the Early Withdrawal Charge will not apply to the first $20,000 of the withdrawal, but will apply to the remaining $30,000 plus the amount needed to pay the Early Withdrawal Charge. If you take another withdrawal later in Contract Year 4, the Early Withdrawal Charge applies to the entire withdrawal plus the amount needed to pay the Early Withdrawal Charge.
If you Surrender your Contract during the first six Contract Years, the amount subject to the Early Withdrawal Charge upon Surrender will not include the current or any prior Free Withdrawal Allowance.
Early Withdrawal Charge Waivers
Extended Care Waiver. (Rider form R1462316NW-Waiver of Early Withdrawal Charges for Extended Care Rider). We will waive the Early Withdrawal Charge that would otherwise apply if you make a Request in Good Order and:
| your Contract is modified by the Extended Care Waiver Rider; |
| you are confined in a long-term care facility or hospital and the confinement is prescribed by a physician and is medically necessary; |
| the first day of the confinement is at least one year after the Contract Effective Date; and |
| the confinement has continued for a period of at least 90 consecutive days. |
You must provide us with satisfactory proof that you meet these conditions before the date of the withdrawal or Surrender. There is no charge for this rider, but it may not be available in all states. (See the State Variations section on page [ ] for information about availability in your state.) You do not need to take any action to add this waiver rider. Before you request a waiver, carefully review the rider to ensure that you understand how it works.
Terminal Illness Waiver. (Rider form R1462416NW-Waiver of Early Withdrawal Charges Upon Terminal Illness Rider). We will waive the Early Withdrawal Charge that would otherwise apply if you make a Request in Good Order and:
| your Contract is modified by the Waiver of Early Withdrawal Charges upon Terminal Illness Rider; |
| you are diagnosed with a terminal illness by a physician and, as a result of the terminal illness, you have a life expectancy of less than 12 months from the date of diagnosis; and |
| the diagnosis is rendered by a physician more than one year after the Contract Effective Date. |
You must provide us with satisfactory proof that you meet these conditions before the date of the withdrawal or Surrender. There is no charge for this rider, but it may not be available in all states. (See the State Variations section below for information about availability in your state.) You do not need to take any action to add this waiver rider. Before you request a waiver, carefully review the rider to ensure that you understand how it works.
Automatic Withdrawal Program Charges
Currently, we do not charge a fee to participate in an automatic withdrawal program. However, we reserve the right to impose an annual fee in such amount as we may then determine to be reasonable for participation in the automatic withdrawal program. If imposed, the fee will not exceed $30 annually.
State Limitations. In some states, our ability to waive fees or charges may be limited by applicable laws, regulations or administrative positions.
Under the Contract you may receive regular Annuity Payout Benefit payments for the duration of the period that you select. Once Annuity Payout Benefit payments start, you can no longer Surrender the Contract or take a withdrawal, no Death Benefit will be payable under your Contract, and your Beneficiary designations will no longer apply. The amount payable after death, if any, is governed by the Payout Option you select.
The Annuity Payout Benefit is payable if the Annuity Payout Initiation Date is reached before the earlier of: (1) a death for which a Death Benefit is payable; or (2) the date that this Contract is Surrendered.
52
Annuity Payout Initiation Date
The Annuity Payout Initiation Date is the first day of the first payment interval for which payment of the Annuity Payout Benefit is to be made. Annuity Payout Benefit payments are made at the end of each payment interval. This means that for annual payments, the first payment will be made one year after the Annuity Payout Initiation Date.
You may select the Annuity Payout Initiation Date by a Request in Good Order. We must receive your request before the last Market Close on or before the Annuity Payout Initiation Date you selected and at least 30 days before the first Annuity Payout Benefit payment is to be made.
| The earliest Annuity Payout Initiation you may select is the first Contract Anniversary. |
| Unless we agree to a later date, the latest Annuity Payout Initiation Date you may select is the Contract Anniversary following your 95th birthday or the 95th birthday, of a joint owner, if earlier. If the Owner is not a human being such as a trust or a corporation, then the Annuity Payout Initiation Date may not be later than the Contract Anniversary following the 95th birthday of the eldest Annuitant, unless we agree to a later date. |
The earliest permitted date and the latest permitted date for the Annuity Payout Initiation Date are set out on your Contract Specifications Page. The latest permitted date may change if an Owner changes.
If you do not select an Annuity Payout Initiation Date by the latest permitted date, we may select it for you. We will notify you in writing at least 45 days before the date we select. We will give you an opportunity to select an earlier date.
Annuity Payout Amount
The amount of each payment under the Annuity Payout Benefit is determined on the Annuity Payout Initiation Date based on the Annuity Payout value on that date, the Payout Option that applies, and the payment interval.
The Annuity Payout value is the amount that can be applied to the Annuity Payout Benefit is equal to: (1) the Account Value on the Annuity Payout Initiation Date; minus (2) premium tax or other taxes not previously deducted. If the Annuity Payout value is determined on a date other than the end of the Term, the Annuity Payout value will be based on the Daily Value Percentage or the locked Daily Value Percentage if you have made a Performance Lock election. Please see the Indexed Strategy Value Before End of Term section on page [ ] or the Indexed Strategy Value After Performance Lock Election on page [ ] for more information.
Form of Annuity Payout Benefit
The Annuity Payout Benefit is paid in the form of annual payments as a Life Payout with Payments for at Least a Fixed Period. That fixed period will be 10 years or, if fewer, the maximum number of whole years permitted by any tax qualification endorsement.
In place of that, you may elect to have the Annuity Payout Benefit paid in any form of Payout Option that is available under your Contract. The available Payout Options are described in the Payout Options section on page [ ]. You may elect a Payout Option by a Request in Good Order. We must receive your request before the last Market Close on or before the Annuity Payout Initiation Date and at least 30 days before the first Annuity Payout Benefit payment is to be made.
Payee for Annuity Payout Benefit
Payment of the Annuity Payout Benefit generally is made to the surviving Owner(s) as the payee(s). In place of that, the surviving Owner(s) may elect for payment to be made as a tax-free exchange, transfer, or rollover, or for payment to be made to the Annuitant. That election must be made by a Request in Good Order that we receive at least 30 days before the payment date.
Payments that become due after the death of the payee are made to:
| the surviving Owner(s); or if none |
| then to the surviving contingent payee(s) designated by the surviving Owner(s); or if none; |
| the estate of the last payee who received payments. |
The portion of any Annuity Payout Benefit remaining after the death of an Owner or Annuitant must be paid at least as rapidly as payments were being made at the time of such death.
You may designate a contingent payee by a Request in Good Order. If you designate your spouse as a contingent payee and your marriage ends before your death, then we will treat your former spouse as having predeceased you except in the following situations: (1) if a court order provides that the former spouses rights as a contingent payee are to continue; or (2) if the former spouse remains or becomes an Owner.
53
A Death Benefit is payable under your Contract if you die before the Annuity Payout Initiation Date and before the Contract is Surrendered. If your spouse becomes a successor owner of the Contract, no Death Benefit will be payable on account of your death.
When the Owner is a non-natural person, a Death Benefit is payable under the Contract if the Annuitant dies before the Annuity Payout Initiation Date and before the Contract is Surrendered. For this purpose, a non-natural person is a trust, custodial account, corporation, limited liability company, partnership, or other entity.
Only one Death Benefit will be paid under the Contract. If a Death Benefit becomes payable, it will be in place of all other benefits under the Contract, and all other rights under this Contract will terminate except for rights related to the Death Benefit.
Death Benefit Payout Date
| If the Death Benefit is to be paid as a lump sum, then it will be paid as soon as practicable after receipt of proof of death and a Request in Good Order for a lump sum payment. |
| If the Death Benefit is to be paid under a Payout Option, then we will apply the Death Benefit value to a Payout Option as soon as practicable after receipt of proof of death and a Request in Good Order. That application date will be the first day of the first payment interval for which a payment is to be made. Death Benefit payments under a Payout Option are made at the end of each payment interval. This means that, for annual payments, the first payment will be made one year after that application date. |
Death Benefit Amount
| If the Death Benefit is paid in a lump sum, then it is equal to the Death Benefit value, increased by any additional post-death interest as required by law. |
| If the Death Benefit will be paid as a series of periodic payments under a Payout Option, then the amount of each payment under the Death Benefit is determined on the date that the Death Benefit value is applied to the Payout Option. The amount or each payment will be based on the Death Benefit value (increased by any additional post-death interest as required by law to the date it is applied to the Payout Option), the Payout Option that applies, and the payment interval. |
Death Benefit Value
The Death Benefit value is the Account Value determined as of the date that the Death Benefit value is determined.
The Death Benefit value is reduced by premium tax or other taxes not previously deducted.
The Account Value will reflect the applicable Strategy values as calculated on the date the Death Benefit is determined. If the Death Benefit value is determined on a date other than the end of the Term, the Death Benefit value will be based on the Daily Value Percentage , or on the locked Daily Value Percentage if you have made a Performance Lock election. Please see the Indexed Strategy Value Before End of Term section on page [ ] or the Indexed Strategy Value After Performance Lock Election on page [ ] for more information.
Determination Date
The date that the Death Benefit value is determined is the earlier of: (1) the first anniversary of the date of death; or (2) the date that we have received both proof of death and Requests in Good Order with instructions as to the form of Death Benefit from all Beneficiaries. Thus, in many cases where there are multiple Beneficiaries, the date that the Death Benefit value is determined will be the date when the last Beneficiary submits the necessary Request in Good Order or the first anniversary of death. Until then, the Contract values remain in the Indexed Strategies will renew into new Terms of the same Strategies if the end of a Term is reached, and the Indexed Strategy values may fluctuate. This risk is borne by the Beneficiaries. If all Beneficiaries have not submitted the necessary Request in Good Order by the first anniversary of death, then the Death Benefit value as determined on that first anniversary will thereafter earn interest at a fixed rate at least equal to the rate required by state law.
Proof of Death. Before making payment of a Death Benefit, or any other payment or transfer of ownership rights that depends on the death of a specified person, we will require proof of death. We may delay making any payment until it is received. For this purpose, proof of death is:
| a certified copy of a death certificate showing the cause and manner of death; |
| a certified copy of a decree that is made by a court of competent jurisdiction as to the finding of death; or |
| other proof that is satisfactory to us. |
Form of Death Benefit
The Death Benefit is paid in the form of annual payments for a fixed period of two years.
54
In place of that, you may elect to have the Death Benefit paid in one lump sum or in any form of Payout Option that is available under your Contract. The available Payout Options are described in the Payout Options section below. There is no additional charge associated with this election. Any election is subject to the Death Benefit Distribution Rules described below.
You may make an election by a Request in Good Order. We must receive your request on or before the date of death for which a Death Benefit is payable. If you do not make such an election, the Beneficiary may make that election after the date of death. The Beneficiarys election must be made by a Request in Good Order that is received by us no later than the date that the Death Benefit value is applied to a Payout Option and at least 30 days before the date of the first payment to be made.
Additional Rules for Payout Options. A Payout Option that is contingent on life is based on the life of the Beneficiary or, in some cases, the life of a person to whom the Beneficiary is obligated. We will pay the Death Benefit as a lump sum rather than as payments under a Payout Option if: (1) the Death Benefit is less than $2,000; or (2) as of the date that the Death Benefit value is to be applied to a Payout Option, the Death Benefit Distribution Rules do not allow a two-year payout.
Payee of Death Benefit Payments
Death Benefit payments generally are made to the Beneficiary as the payee.
In place of that, the Beneficiary may elect to have payments made:
| as a tax-free exchange, transfer, or rollover to or for an annuity or tax-qualified account as permitted by federal tax law; or |
| in cases where the Beneficiary is an estate, trust, custodial account, corporation, limited liability company, partnership, or other entity, to a person to whom the Beneficiary is obligated to make corresponding payments. |
Payments that become due after the death of the Beneficiary are made to:
| the contingent payee designated as part of a Death Benefit Payout Option elected by you; or if none |
| then to a contingent payee designated by the Beneficiary; or if none |
| the estate of the last payee who received payments. |
Such payments are subject to the Death Benefit Distribution Rules described below.
You may designate a contingent payee by a Request in Good Order. A Beneficiary may make or change a payee or contingent payee, except a Beneficiary may not change a designation made as part of a Payout Option election made by you for the Death Benefit. If the Beneficiary designates his or her spouse as a contingent payee and their marriage ends before the Beneficiarys death, then we will treat the former spouse as having predeceased the Beneficiary except to the extent a court order provides that the former spouses rights as a contingent payee are to continue.
Death Benefit Distribution Rules
The Death Benefit Distribution Rules are summarized below.
| For a Tax Qualified Contract. The Death Benefit must be paid in accordance with the tax qualification endorsement. |
| For a Nonqualified Contract. The Death Benefit must be paid either: (1) in full within five years of the date of death; or (2) over the life of the Beneficiary or over a period certain not exceeding the Beneficiarys life expectancy, with payments at least annually, and with the first payment made within one year of the date of death. |
The standard Payout Options are described below. We will make payments in any other form of Payout Option that is acceptable to us at the time of any election. More than one Payout Option may be elected if the requirements for each Payout Option elected are satisfied. All elected Payout Options must comply with pertinent laws and regulations.
Payments under each standard Payout Option are made at the end of a payment interval. For example, if the Annuity Payout Initiation Date is October 31, 2028 and you select annual payments, then the first payment will be paid as of October 31, 2029.
Fixed Period Payout
| For the Annuity Payout Benefit |
We will make periodic payments to you, or to the Annuitant, if you direct, for the fixed period of time that you select. For a nonqualified contract, fixed periods shorter than 10 years are not available. For a tax-qualified contract, the only fixed period available is 10 years.
| If the payee dies before the end of the fixed period, then we will make periodic payments to the surviving owner(s), or if none, then to the surviving contingent payee(s), or if none, then to the estate of the last payee who received payments. |
| In all cases, payments will stop at the end of the fixed period. |
55
| For the Death Benefit |
We will make periodic payments to the Beneficiary for the fixed period of time that you or the Beneficiary selects. The fixed period cannot exceed the life expectancy of the Beneficiary. For a tax-qualified contract, the fixed period also cannot exceed 10 years.
| If the Beneficiary dies before the end of the fixed period, then we will make periodic payments to the contingent payee designated as part of any Death Benefit Payout Option that you have elected. If no such contingent payee is surviving, then such payments will be made to a contingent payee designated by the Beneficiary. If there is no contingent payee surviving, then such payments will be made to the estate of the last payee who received payments. |
| In all cases, payments will stop at the end of the fixed period. |
Life Payout
| For the Annuity Payout Benefit |
We will make periodic payments to you, or to the Annuitant, if you direct, for as long as the Annuitant lives. Payments will stop on the death of the Annuitant. This means that, even if we have made only one payment when the Annuitant dies, payments will stop.
If the Annuitant dies after the Annuity Payout Initiation Date but before the first payment, a Life Payout will not provide any benefit at all. In that case, we will reverse the Annuity Benefit Payout election and treat the Contract as if the Annuity Payout Initiation Date had not yet been reached.
| If the Owner is living, this treatment will generally allow the Owner to choose between continuing the Contract as a deferred annuity or electing a new Annuity Payout Initiation Date and another Payout Option. |
| If the Annuitants death before the Annuity Payout Initiation Date would give rise to a Death Benefit, then the Death Benefit will be available. |
For a tax-qualified contract, a Life Payout is not available to all Beneficiaries.
| For the Death Benefit |
We will make periodic payments to the Beneficiary for as long as the Beneficiary lives. Payments will stop on the death of the Beneficiary. This means that, even if we have made only one payment when the Beneficiary dies, payments will stop.
If the Beneficiary dies after the Death Benefit is applied to the Payout Option but before the first payment, a Life Payout will not provide any benefit at all. In that case, we will reverse the Payout Option election and allow the Beneficiarys estate to choose a new Payout Option or to take the Death Benefit as a lump sum.
Life Payout with Payments for at Least a Fixed Period
| For the Annuity Payout Benefit |
We will make periodic payments to you, or to the Annuitant, if you direct, for as long as the Annuitant lives. For a tax-qualified contract, fixed periods longer than 10 years are not available.
| If the Annuitant dies after the end of the fixed period you selected, then payments will stop on the death of the Annuitant. |
| If the Annuitant dies before the end of the fixed period you selected, then we will make periodic payments to the surviving owner(s), or if none, then to the surviving contingent payee(s), or if none, then to the estate of the last payee who received payments. In this case, payments will stop at the end of the fixed period you selected. |
| For the Death Benefit |
We will make periodic payments to the Beneficiary for as long as the Beneficiary lives. The fixed period cannot exceed the life expectancy of the Beneficiary. For a tax-qualified contract, a Life Payout with Payments for at Least a Fixed Period is not available to all Beneficiaries, and the fixed period also cannot exceed 10 years.
| If the Beneficiary dies after the end of the fixed period selected, then payments will stop on the death of the Beneficiary. |
| If the Beneficiary dies before the end of the fixed period you or the Beneficiary selected, then we will make periodic payments to the contingent payee designated as part of any Death Benefit Payout Option that you have elected. If no such contingent payee is surviving, then such payments will be made to a contingent payee designated by the Beneficiary. If there is no contingent payee surviving, then such payments will be made to the estate of the last payee who received payments. In this case, payments will stop at the end of the fixed period you or the Beneficiary selected. |
56
Joint and One-Half Survivor Payout
| For the Annuity Payout Benefit |
We will make periodic payments to you, or to the primary Annuitant, if you direct, for as long as the primary Annuitant lives.
| If the primary Annuitant dies and the secondary Annuitant does not survive the primary Annuitant, then payments will stop on the death of the primary Annuitant. This means that, even if we have made only one payment when the primary Annuitant dies, payments will stop unless the secondary Annuitant survives. |
| If the primary Annuitant dies and the secondary Annuitant is surviving, then we will make one-half of the periodic payment to you, or the secondary Annuitant, if you direct, for the rest of the secondary Annuitants life. In this case, payments will stop on the death of the secondary Annuitant. |
If the Annuitant dies after the Annuity Payout Initiation Date but before the first payment, a Joint and One-Half Survivor Payout will never provide the full payment amount. In that case, if the secondary Annuitant agrees, we will reverse the Annuity Benefit Payout election and treat the Contract as if the Annuity Payout Initiation Date had not been reached.
| If the Owner is living, this treatment will generally allow the Owner to choose between continuing the Contract as a deferred annuity or electing a new Annuity Payout Initiation Date and another Payout Option. |
| If the Annuitants death before the Annuity Benefit Payout Initiation Date would give rise to a Death Benefit, then the Death Benefit will be available. |
| For the Death Benefit |
We will make periodic payments to the Beneficiary for as long as the Beneficiary lives.
| If the Beneficiary dies and the contingent payee does not survive the Beneficiary, then payments will stop on the death of the Beneficiary. This means that, even if we have made only one payment when the Beneficiary dies, payments will stop unless the contingent payee survives. |
| If the Beneficiary dies and the contingent payee designated as part of the Death Benefit Payout Option election is surviving, then we will make one-half of the periodic payment to the contingent payee for the rest of the contingent payees life. In this case, payments will stop on the death of the contingent payee. |
If the Beneficiary dies after the Death Benefit is applied to the Payout Option but before the first payment, a Joint and One-Half Survivor Payout will never provide the full payment amount. In that case, if the contingent payee agrees, we will reverse the Payout Option election and allow the Beneficiarys estate to choose a new Payout Option or to take the Death Benefit as a lump sum.
A Joint and One-Half Survivor Payout is only available to a Beneficiary who is the surviving spouse of the owner.
Payments under a Payout Option
Payments under a Payout Option are calculated and paid as fixed dollar payments. The stream of payments is an obligation of the general account of MassMutual Ascend Life. Fixed dollar payments will remain level for the duration of the payment period. Once payments begin under a Payout Option, the Payout Option may not be changed. Once the Contract value is applied to a Payout Option, the periodic payments cannot be accelerated or converted into a lump sum payment unless we agree.
We will use the 2012 Individual Annuity Reserving Table with projection scale G2 for blended lives (60% female/40% male) with interest at 1% per year, compounded annually, to compute all guaranteed Payout Option factors, values, and benefits under the Contract. For purposes of calculating payments based on the age of a person, we will use his or her age as of his or her last birthday.
Considerations in Selecting a Payout Option
Payments under a Payout Option are affected by various factors, including the length of the payment period, the life expectancy of the person on whose life payments are based, and the frequency of the payment interval (monthly, quarterly, semi-annually or annually).
| Generally, the longer the period over which payments are made or the more frequently the payments are made, the lower the amount of each payment because more payments will be made. |
| For Life Payout Options, the longer the life expectancy of the Annuitant or Beneficiary, the lower the amount of each payment because more payments are expected to be paid. |
Non-Human Payees under a Payout Option
Except as stated below, the primary payee under a Payout Option must be a human being. All payments during his or her life must be made by check payable to the primary payee or by electronic transfer to a bank account owned by the primary payee.
Exceptions. Below are some exceptions to the general rule that the primary payee must be a human being. We may make other exceptions in our discretion.
| A nonhuman that is the Owner of the Contract may be the primary payee. For example, if the Owner is a trust, that trust may be the primary payee. |
57
| Payments may be made payable to another insurance company or financial institution as a tax-free exchange, transfer, or rollover to or for another annuity or tax-qualified account as allowed by federal tax law. |
PROCESSING PURCHASE PAYMENTS AND REQUESTS
Processing Purchase Payments
| If we receive a Purchase Payment on a Market Day before the Market Close, we will apply it to your Contract on that Market Day. |
| If we receive a Purchase Payment on a Market Day after the Market Close or on a day that is not a Market Day, then we will apply it to your Contract on the next Market Day. |
An amount applied to a Contract will be held in the Purchase Payment Account until it is applied to an Indexed Strategy or Strategies on a Strategy Application Date pursuant to your instructions. We cannot apply an amount held in the Purchase Payment Account to an Indexed Strategy or Strategies if we do not have complete instructions from you.
If you have any questions, you should contact us or your registered representative before sending a Purchase Payment.
Processing Requests
| Requests may be made by mail at P.O. Box 5423, Cincinnati OH 45201-5423. |
| Requests by fax may be made at 800-807-9777. |
| Requests for reallocations among Indexed Strategies may be made by telephone at 1-800-789-6771 between 8:00 AM and 4:00 PM Eastern Time Monday through Friday. We may also permit reallocation requests to be made at our website (www. massmutualascend.com). Some selling firms may restrict the ability of their registered representatives to convey reallocation requests by telephone or Internet on your behalf. |
To obtain one of our forms (for example, a Strategy Selection form or a Withdrawal Request form) or to obtain more information about how to make a request, call us at 1-800-789-6771 or send us a fax at 800-807-9777. You can also request forms or information by mail at MassMutual Ascend Life Insurance Company, P.O. Box 5423, Cincinnati OH 45201-5423. You may also obtain forms on our website (www. massmutualascend.com).
We cannot process a request unless it is a Request in Good Order. A request may be rejected or delayed if it is not a Request in Good Order.
| If we receive a Request in Good Order on a Market Day before the Market Close, we will process it using values determined for the Market Close on that Market Day. |
| If we receive a Request in Good Order after the Market Close or on a day that is not a Market Day, then we will treat that request as received at the start of the next Market Day. |
If you have any questions, you should contact us or your registered representative before submitting the request.
Exception. If a withdrawal under an automatic withdrawal program is scheduled for a date that is not a Market Day, then we will process the withdrawal on the scheduled date using values at the most recent Market Close. For example, if the automatic withdrawal is scheduled for a date that falls on Sunday and there was a Market Close at 4:00 PM on the previous Friday, then we will process the withdrawal on Sunday using values determined at 4:00 PM on that Friday.
Market Days and Market Close
A Market Day is each day that all markets that are used to measure available Indexed Strategies are open for regular trading.
| Saturdays, Sundays, holidays and any other day that the New York Stock Exchange and the NYSE Arca are closed are not Market Days. |
| The NYSE and the NYSE Arca observe the following holidays: New Years Day, Martin Luther King, Jr. Day, Presidents Day, Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving Day, and Christmas Day. |
A Market Close is the close of the regular or core trading session on the market used to measure a given Indexed Strategy.
| Regular trading hours on the NYSE and core trading sessions on the NYSE Arca usually end at 4:00 PM Eastern Time |
| Trading hours on the NYSE and core trading sessions on the NYSE Arca end at 1:00 PM Eastern Time on the day before the Fourth of July and the Friday after Thanksgiving and Christmas Eve. |
Regular trading or a core trading session may end at a different time on a Market Day under certain circumstances when and as permitted under applicable rules. Such circumstances generally cannot be predicted in advance.
58
Specific information about NYSE and NYSE Arca holidays and trading hours in any given calendar year is available at https://www.nyse.com/markets/hours-calendars.
Receipt of Purchase Payments, Applications and Requests
For purposes of processing, we deem Purchase Payments and applications, Requests in Good Order and other instructions (paperwork) mailed to our post office box as received by us at our administrative office when the Purchase Payment or the paperwork reaches the applicable processing department located at 191 Rosa Parks Street, Cincinnati OH 45202.
Risks and Limitations Related to Requests by Telephone or Internet
We will use reasonable procedures such as requiring certain identifying information, tape recording the telephone instructions, and providing written confirmation of the transaction, in order to confirm that instructions communicated by telephone, fax, Internet or other means are genuine. Any telephone, fax or Internet instructions reasonably believed by us to be genuine will be your responsibility, including losses arising from any errors in the communication of instructions. As a result of this policy, you will bear the risk of loss. We are not responsible for the validity of any request or action.
Telephone and computer systems may not always be available. Any telephone or computer system, whether it is yours, your service providers, your agents, or ours, can experience outages or slowdowns for a variety of reasons. These outages or slowdowns may delay or prevent our processing of your request. Although we have taken precautions to help our systems handle heavy use, we cannot promise complete reliability under all circumstances. If you experience technical difficulties or problems, you should consider making your request by mail.
Suspension of Payments or Transfers
We may be required to suspend or delay payments, withdrawals and reallocations when we cannot obtain an Index value because:
| the New York Stock Exchange or NYSE Arca is closed (other than customary weekend and holiday closings); |
| trading on the New York Stock Exchange or NYSE Arca is restricted; or |
| an emergency exists such that it is not reasonably practicable to determine fairly the value of the Index. |
In this case, we will make payments and process withdrawals and reallocations as soon as practicable after we are able to obtain the Index value.
We may suspend or delay payments, withdrawals and reallocations when we are permitted to do so under a regulatory order. In this case, we will make payments and process withdrawals and reallocations when the order is no longer in effect.
Restrictions on Financial Transactions
Federal laws designed to counter terrorism and prevent money laundering might, in certain circumstances, require us to block an Owners ability to make certain transactions. This means that we may be required to refuse to accept any request for withdrawals, Surrenders, Annuity Payout Benefit payments or Death Benefit payments, until instructions are received from the appropriate regulator. We may also be required to provide additional information about you and your Contract to government regulators.
If you change your mind about owning the Contract, you may cancel it within 20 days after you receive it. If you purchase this Contract to replace an existing annuity contract or life insurance policy, you have 30 days after you receive it. This is known as a free look. The right to cancel period may be longer in some states.
To cancel your Contract, you must submit your request to cancel to the producer who sold it or send it to us at P.O. Box 5423, Cincinnati, OH 45201-5423. If sent to us by mail, it is effective on the date postmarked with proper address and postage paid. Your request to cancel must be in writing and signed by you.
If you cancel your Contract, you will receive a refund. The amount of the refund will depend on where you live. When you cancel the Contract within this free look period, we will not assess an Early Withdrawal Charge.
| If you live in a state where we are required to refund your Purchase Payment(s), we reserve the right to hold your Purchase Payment(s) in the Purchase Payment Account until the first Strategy Application Date on or after the end of the free look period. |
| If you live in a state where we are required to refund the Account Value of your Contract, you will receive the Account Value on the day that we receive your cancellation Request in Good Order. If the Account Value includes the value of an Indexed Strategy, that Strategy value will reflect the applicable Daily Value Percentage. The amount you receive may be more or less than your Purchase Payment(s) depending upon any interest earned by your Contract and the value of your Indexed Strategies. This means that you bear the risk of any decline in the Account Value of your Contract before we receive your cancellation request. |
59
No Early Withdrawal Charges will apply to the amount refunded. Unless required by state law, we do not refund any Daily Charge assessed during the free look period or any Early Withdrawal Charges assessed during the free look period that relate to a withdrawal taken before you cancel the Contract.
The State Variations section of this prospectus contains a summary of the state law provisions related to the free look period and the required refund amount.
There may be tax consequences if you cancel the Contract. You should seek advice on tax questions based on your particular circumstances from a tax advisor.
ANNUAL STATEMENT AND CONFIRMATIONS
At least once each calendar year, we will send you a statement that will show: (1) your Account Value; (2) all transactions regarding your Contract during the year; and (3) any interest credited to your Contract and/or any other changes in Strategy value credited to your Contract.
We will also send you written confirmations of Purchase Payments, Indexed Strategy allocations and renewals, withdrawals, and other financial transactions under your Contract. Statements and confirmations will be sent to your last known address on our records.
You should promptly report any inaccuracy or discrepancy in a statement or confirmation. To report an inaccuracy or discrepancy, contact us at P.O. Box 5423, Cincinnati, OH 45201-5423, or call us at 1-800-789-6771. To protect your rights, you should consider reconfirming any oral communications by sending a written statement to P.O. Box 5423, Cincinnati, OH 45201-5423.
You may elect to receive electronic delivery of the Contract prospectus and other Contract related documents. Contact us at our website at www. massmutualascend.com for more information and to enroll.
ABANDONED PROPERTY REQUIREMENTS
Every state has unclaimed property laws. These laws generally declare annuity contracts to be abandoned after a period of inactivity of three to five years from: (1) the latest permitted Annuity Payout Initiation Date; or (2) the date of death for which a Death Benefit is due and payable. For example, if the payment of a death benefit has been triggered, but the beneficiary does not come forward to claim the death benefit in a timely manner, the unclaimed property laws will apply.
If a Death Benefit, Annuity Payout Benefit payments or other contract proceeds are unclaimed, we will pay them to the abandoned property division or unclaimed property office of the applicable state. (Escheatment is the formal, legal name for this process.) For example, on an unclaimed Death Benefit, depending on the circumstances, the proceeds are paid: (1) to the state where the beneficiary last resided, as shown on our books and records; (2) to the state where the contract owner last resided, as shown on our books and records; or (3) to Ohio, which is our state of domicile. The state will hold the proceeds without interest until a valid claim is made by the person entitled to the proceeds.
To prevent escheatment of the Death Benefit, Annuity Payout Benefit payments, or other proceeds from your Contract, it is important:
| to update your contact information, such as your address, phone number, and email address, if and as it changes; and |
| to update your Beneficiary and other designations, including complete names, complete addresses, phone numbers, and social security numbers, if and as they change. |
Please contact us at P.O. Box 5423, Cincinnati, OH 45201-5423, or call us at 1-800-789-6771, to make such updates.
State unclaimed property laws do not apply to annuity contracts that are held under an employer retirement plan that is subject to the Employee Retirement Income Security Act of 1974 (ERISA).
The Owner on the Contract Effective Date is set out on your Contract Specifications Page. The Owner possesses all of the ownership rights under a Contract, such as making allocations among the Indexed Strategies, electing a Payout Option, and designating a Beneficiary.
If an Owner is a trust, custodial account, corporation, limited liability company, partnership, or other entity, then the age of the eldest Annuitant is treated as the age of the Owner for all purposes of this Contract.
60
Joint Owners
| For a Nonqualified Contract. Two persons may jointly own the Contract. In this case, the term Owner includes the joint Owner and you must exercise all rights of ownership by joint action. |
| For a Tax Qualified Contract. No joint owner is permitted. |
Change of Owner
| For a Nonqualified Contract. You may change the Owner only with our written consent. A change of Owner cancels all prior Beneficiary designations. It does not cancel a designation of an Annuitant or a Payout Option election. |
| For a Tax Qualified Contract. You cannot change the Owner except to the limited extent permitted by the tax qualification endorsement. |
A change of Owner must be made by a Request in Good Order. A change of Owner may have adverse tax consequences.
Assignment
| For a Nonqualified Contract. You may pledge, charge, encumber or assign you interest in this Contract only with our written consent. If we grant our consent, you may assign all or any part of your rights under this Contract except your rights to designate or change a Beneficiary or an Annuitant, to change Owners, or to elect a Payout Option. |
| For a Tax Qualified Contract. You cannot pledge, charge, encumber or in any way assign your interest in this Contract except to the limited extent permitted by the tax qualification endorsement. |
An assignment must be requested by a Request in Good Order. We are not responsible for the validity of any assignment. An assignment may have adverse tax consequences.
If we have consented to an assignment, the rights of a person holding the assignment, including the right to any payment under this Contract, come before the rights of an Owner, Annuitant, Beneficiary, or other payee. An assignment may be ended only the person holding it or as provided by law.
Successor Owner
Your spouse becomes the successor owner of the Contract and succeeds to all rights of ownership if all of the following requirements are met:
| a Death Benefit is payable on account of your death; |
| the sole Beneficiary under the Contract is your spouse or a revocable trust or custodial account created by your spouse; |
| either you make that election by a Request in Good Order before your death or your spouse makes that election by a Request in Good Order before the Death Benefit Payment Date; and |
| you were not a successor owner of the Contract. |
A successor owner election cancels all prior Beneficiary designations. It does not cancel a designation of an Annuitant or a Payout Option election.
In some states, state law extends this successor owner right to a civil union partner or other person who is not your spouse as defined by federal tax law. In that case, distributions after your death must be made as required by the Death Benefit Distributions Rules described in the Death Benefit section on page [ ].
Community Property
If you live in a community property state and have a spouse at any time while you own this Contract, the laws of that state may vary your ownership rights.
The Annuitant is the natural person on whose life Annuity Payout Benefit payments are based. The Annuitant on the Contract Effective Date is set out on your Contract Specifications Page.
| For a Nonqualified Contract. The Annuitant cannot be changed at any time that the Contract is owned by a trust, custodial account, corporation, limited liability company, partnership, or other entity. Otherwise, you may change a designation of Annuitant at any time before the Annuity Payout Initiation Date. |
61
| For a Tax Qualified Contract. The Annuitant must be the natural person covered under the retirement arrangement for whose benefit the Contract is held. |
A change of Annuitant must be made by a Request in Good Order. A change of Annuitant does not cancel a designation of a Beneficiary or a Payout Option election.
If an Annuitant dies before the Annuity Payout Initiation Date and no Death Benefit is payable, then in the absence of a new designation, the Annuitant will be:
| the surviving joint Annuitant(s); or if none |
| the Owner(s). |
A Beneficiary is a person entitled to receive all or part of a Death Benefit that is to be paid under this Contract on account of a death before the Annuity Payout Initiation Date.
| If a Death Benefit becomes payable on account of your death or the death of a joint Owner, then the surviving Owner is the Beneficiary no matter what other designation you may have made. |
| In all other cases, you may designate a person or person who will be the Beneficiaries as provided in the Designation of Beneficiary provision of the Contract. |
| If no designated Beneficiary is surviving, then the Beneficiary is your estate. |
| If the sole Beneficiary under the Contract is your spouse or a revocable trust or custodial account created by your spouse and all other requirements for successor ownership are met, then your spouse may become the successor owner of the Contract in lieu of receiving the Death Benefit. |
A designation of Beneficiary must be made by a Request in Good Order. We must receive the request on or before the date of death for which a Death Benefit is payable.
| You may designate two or more persons jointly as the Beneficiaries. Unless you state otherwise, joint Beneficiaries that are surviving are entitled to equal shares. |
| You may designate one or more persons as contingent Beneficiary. Unless you state otherwise, a contingent Beneficiary is entitled to a benefit only if there is no primary Beneficiary who that is surviving. |
Survivorship Required
In order to be entitled to receive a Death Benefit, a Beneficiary must survive for at least 30 days after the death for which the Death Benefit is payable.
If you designate your spouse as a Beneficiary and your marriage ends before your death, we will treat your former spouse as having predeceased you unless:
| a court order provides that the former spouses rights as a beneficiary are to continue; or |
| the former spouse remains or becomes an Owner. |
Amendment of the Contract
We reserve the right to amend the Contract to comply with applicable Federal or state laws or regulations. We will notify you in writing of any such amendments.
Misstatement
We may require proof of the age of the Annuitant, Owner and/or the Beneficiary before making any payments under the Contract that are measured by such persons life. If the age of the measuring life has been misstated, the amount payable will be the amount that would have been provided at the correct age. If payments based on the correct age would have been higher, we will pay the underpaid amount with interest. If payments would be lower, we may deduct the overpaid amount, with interest, from succeeding payments.
62
Involuntary Termination
If the Account Value on any anniversary of the initial Strategy Application Date is less than the minimum required value of $5,000 due to poor market performance or withdrawals from the Contract, we may terminate your Contract on that anniversary.
| If you make only one Purchase Payment, each Term will end on an anniversary of the initial Strategy Application Date. In this case, any involuntary termination will occur on a date that is the end of a Term. |
| If you make multiple Purchase Payments, Terms may end on different dates. In this case, any involuntary termination will occur on a date that is the end of a Term, but it will occur before the end of other Terms. In this case, the Surrender Value payable upon termination of your Contract will reflect the Daily Value Percentages used to calculate the value of Indexed Strategies with Terms that are not ending on the termination date. |
The examples below show the relationship between the date of an involuntary termination and the end of a Term.
Example A. You make one Purchase Payment that is applied to the Indexed Strategies on June 20, 2023. Terms will start and end on June 20 and the anniversary of the initial Strategy Application Date will be June 20. If your Account Value is less than $5,000 on June 20, 2025, we may terminate your Contract on that anniversary date.
Example B. You make two Purchase Payments. One Purchase Payment is applied to the Indexed Strategies on May 6, 2023 and the other Purchase Payment is applied to the Indexed Strategies on June 20, 2023. Terms will start and end on May 6 and on June 20. The anniversary of the initial Strategy Application Date will be May 6.
| If your Account Value is less than $5,000 on June 20, 2025, we may not terminate your Contract because June 20 is not an anniversary of the initial Strategy Application Date. |
| If your Account Value is less than $5,000 on May 6, 2027, we may terminate your Contract on that anniversary date even though the other Term will not end until June 20, 2027. |
If we terminate your Contract, we will pay you the Surrender Value determined as of the date that we terminate your Contract. The Surrender Value will reflect the applicable Indexed Strategy Values as calculated on the day that we terminate your Contract.
Loans
Loans are not available under the Contract.
This section provides a general description of federal income tax considerations relating to the Contracts. The purchase, holding and transfer of a Contract may have federal estate and gift tax consequences in addition to income tax consequences. Estate and gift taxation is not discussed in this prospectus. State taxation will vary, depending on the state in which you reside, and is not discussed in this prospectus.
The tax information provided in this prospectus is not intended or written to be used as legal or tax advice. It is written solely to provide general information related to the sale and holding of the Contracts. You should seek advice on legal or tax questions based on your particular circumstances from an attorney or tax advisor.
Tax Deferral on Annuities
Internal Revenue Code (IRC) Section 72 governs taxation of annuities in general. The income earned on a Contract is generally not included in income until it is withdrawn from the Contract. In other words, a Contract is a tax-deferred investment. Tax deferral is not available for a Contract when an Owner is not a natural person unless the Contract is part of a tax-qualified retirement plan or the Owner is a mere agent for a natural person. For a nonqualified deferred compensation plan, this rule means that the employer as Owner of the Contract will generally be taxed currently on any increase in the Surrender Value, although the plan itself may provide a tax deferral to the participating employee.
Under certain circumstances, based on a rule known as the Investor Control Doctrine, the IRS has stated that the holder of an annuity contract could be treated as the owner (for tax purposes) of the assets of a separate account that supports the annuity contract. If you were treated as the owner of an interest in the separate account, then you would be taxed on the income, gain, and loss arising out of your interest in the separate account. Although the IRS has not provided definitive guidance on the application of this rule to indexed annuity contracts, we do not believe that this rule applies to the Contract because you have no specific, fractional, or unitized interest in the separate account assets, we are not obligated to invest the separate account in any particular assets, the investment return and market value of the separate account assets is not allocated in an identical manner to any Contract, the Contract values are determined based on gains and losses regardless of the performance of the separate account assets, and the derivatives that we may hold in the separate account are not publicly traded.
63
Tax-Qualified Retirement Plans
Annuities may also qualify for tax-deferred treatment, or serve as a funding vehicle, under tax-qualified retirement plans that are governed by other IRC provisions. These provisions include IRC Section 401 (pension, profit sharing, and 401(k) plans), IRC Section 403(b) (tax-sheltered annuities), IRC Sections 408 and 408A (individual retirement annuities), and IRC Section 457(b) (governmental deferred compensation plans). Tax-deferral is generally also available under these tax-qualified retirement plans through the use of a trust or custodial account without the use of an annuity.
The tax law rules governing tax-qualified retirement plans and the treatment of amounts held and distributed under such plans are complex. If the Contract is to be used in connection with a tax-qualified retirement plan, including an individual retirement annuity (IRA) under a Simplified Employee Pension (SEP) Plan, you should seek competent legal and tax advice regarding the suitability of the Contract for your particular situation.
Contributions to a tax-qualified Contract are typically made with pre-tax dollars, while contributions to other Contracts are typically made from after-tax dollars, though there are exceptions in either case. Tax-qualified Contracts may also be subject to restrictions on withdrawals that do not apply to other Contracts. These restrictions may be imposed to meet the requirements of the IRC or of an employer plan.
Following is a brief description of the types of tax-qualified retirement plans for which the Contracts are available.
Individual Retirement Annuities. IRC Sections 219 and 408 permit certain individuals or their employers to contribute to an individual retirement arrangement known as an Individual Retirement Annuity or IRA. Under applicable limitations, an individual may claim a tax deduction for certain contributions to an IRA. Contributions made to an IRA for an employee under a Simplified Employee Pension (SEP) Plan or Savings Incentive Match Plan for Employees (SIMPLE) established by an employer are not includable in the gross income of the employee until distributed from the IRA. Distributions from an IRA are taxable to the extent that they represent contributions for which a tax deduction was claimed, contributions made under a SEP plan or SIMPLE, or income earned within the IRA.
Roth IRAs. IRC Section 408A permits certain individuals to contribute to a Roth IRA. Contributions to a Roth IRA are not tax deductible. Tax-free distributions of contributions may be made at any time. Distributions of earnings are tax-free following the five-year period beginning with the first year for which a Roth IRA contribution was made if the Owner has attained age 59 1/2, become disabled, or died, or for qualified first-time homebuyer expenses.
Tax-Sheltered Annuities. IRC Section 403(b) of permits public schools and charitable, religious, educational, and scientific organizations described in IRC Section 501(c)(3) to establish tax-sheltered annuity or TSA plans for their employees. TSA contributions and Contract earnings are generally not included in the gross income of the employee until distributed from the TSA. Amounts attributable to contributions made under a salary reduction agreement cannot be distributed until the employee attains age 59 1/2, severs employment, becomes disabled, incurs a hardship, is eligible for a qualified reservist distribution, or dies. The IRC and the plan may impose additional restrictions on distributions.
Pension, Profit-Sharing, and 401(k) Plans. IRC Section 401 permits employers to establish various types of retirement plans for employees, and permits self-employed individuals to establish such plans for themselves and their employees. These plans may use annuity contracts to fund plan benefits. Generally, contributions are deductible to the employer in the year made, and contributions and earnings are generally not included in the gross income of the employee until distributed from the plan. The IRC and the plan may impose restrictions on distributions. Purchasers of a Contract for use with such plans should seek competent advice regarding the suitability of the Contract under the particular plan.
Governmental Eligible Deferred Compensation Plans. State and local government employers may purchase annuity contracts to fund eligible deferred compensation plans for their employees, as described in IRC Section 457(b). Contributions and earnings are generally not included in the gross income of the employee until the employee receives distributions from the plan. Amounts cannot be distributed until the employee attains age 70 1/2, severs employment, becomes disabled, incurs an unforeseeable emergency, or dies. The plan may impose additional restrictions on distributions.
Roth TSAs, Roth 401(k)s, and Roth 457(b)s. IRC Section 402A permits TSA plans, 401(k) plans, and governmental 457(b) plans to allow participating employees to designate some part or all of their future elective contributions as Roth contributions. Roth contributions to a TSA plan, 401(k) plan, or governmental 457(b) plan are included in the employees taxable income as earned. Amounts attributable to Roth TSA, Roth 401(k), or Roth 457(b) contributions must be held in a separate account from amounts attributable to traditional pre-tax TSA, 401(k), or 457(b) contributions. Distributions from a Roth TSA, Roth 401(k), or Roth 457(b) account are considered to come proportionally from contributions and earnings. Distributions attributable to Roth account contributions are tax-free. Distributions attributable to Roth account earnings are tax-free following the five-year period beginning with the first year for which Roth contributions are made to the plan if the employee has attained age 59 1/2, become disabled, or died. A Roth TSA, Roth 401(k), or Roth 457(b) account is subject to the same distribution restrictions that apply to amounts attributable to traditional pre-tax TSA, 401(k), or 457(b) contributions made under a salary reduction agreement. The plan may impose additional restrictions on distributions.
Nonqualified Deferred Compensation Plans
Employers may invest in annuity contracts in connection with unfunded deferred compensation plans for their employees. Such plans may include eligible deferred compensation plans of non-governmental tax-exempt employers, as described in IRC Section 457(b); deferred compensation plans of both governmental and nongovernmental tax-exempt employers that are taxed under IRC Section 457(f) and subject to Section 409A; and nonqualified deferred compensation plans of for-profit employers subject to Section 409A. In most cases, these plans are designed so that amounts credited under the plan will not be includable in the employees gross income until paid under the plan. In these situations, the annuity contracts are not plan assets and are subject to the claims of the employers general creditors. Whether or not made from the Contract, plan benefit payments are subject to restrictions imposed by the IRC and the plan.
64
Summary of Income Tax Rules
The following chart summarizes the basic income tax rules governing tax-qualified retirement plans, nonqualified deferred compensation plans, and other non-tax-qualified Contracts.
Tax-Qualified Contracts and Plans |
Nonqualified Deferred |
Other Non-Tax-Qualified Contracts | ||||
Plan Types | IRC §408 (IRA, SEP, SIMPLE IRA)
IRC §408A (Roth IRA)
IRC §403(b) (Tax-Sheltered Annuity)
IRC §401 (Pension, ProfitSharing, 401(k))
Governmental IRC §457(b)
IRC §402A (Roth TSA, Roth 401(k), or Roth 457(b)) |
IRC §409A
Nongovernmental IRC §457(b)
IRC §457(f) |
IRC §72 only | |||
Who May Purchase a Contract | Eligible employee, employer, or employer plan. | Employer on behalf of eligible employee. Employer generally loses tax-deferred status of Contract itself. | Anyone. Non-natural person will generally lose tax-deferred status. | |||
Contribution Limits | Contributions are limited by IRC and/or plan requirements. | None. | ||||
Distribution Restrictions | Distributions from Contract and/or plan may be restricted to meet IRC and/or plan requirements. | None. | ||||
Taxation of Withdrawals, Surrenders, and Lump Sum Death Benefit | Generally, 100% of distributions must be included in taxable income. However, the portion that represents an after-tax investment is not taxable. Distributions from Roth IRA are deemed to come first from after- tax contributions. Distributions from other plans are generally deemed to come from income and after-tax investment (if any) on a pro-rata basis. Distributions from §408A Roth IRA or §402A Roth TSA, Roth 401(k), or Roth 457(b) are completely tax free if certain requirements are met.
For tax purposes, all IRAs and SEP IRAs of an owner are treated as a single IRA, and all Roth IRAs of an owner are treated as a single Roth IRA. |
Generally, distributions must be included in taxable income until all accumulated earnings are paid out. Thereafter, distributions are tax-free return of the original investment. However, distributions are tax-free until any investment made before August 14, 1982 is returned.
For tax purposes, all non-tax-qualified annuity contracts issued to the same owner by the same insurer in the same calendar year are treated as one contract. | ||||
Taxation of Payout Option Payments (Annuity Benefit or Death Benefit) | A percentage of each payment is tax free equal to the ratio of after-tax investment (if any) to the total expected payments, and the balance is included in taxable income. Once the after-tax investment has been recovered, the full amount of each benefit payment is included in taxable income. Distributions from a Roth IRA, Roth TSA, Roth 401(k), or Roth 457(b) are completely tax free if certain requirements are met. | |||||
Possible Penalty Taxes for Distributions Before Age 59 1/2 | Taxable portion of payments made before age 59 1/2 may be subject to 10% penalty tax (or 25% for a SIMPLE IRA during the first two years of participation). Penalty taxes do not apply to payments after the participants death, or to §457 plans. Other exceptions may apply. | None. | Taxable portion of payments made before age 59 1/2 may be subject to a 10% penalty tax. Penalty taxes do not apply to payments after the Owners death. Other exceptions may apply. | |||
Assignment/ Transfer of Contract | Assignment and transfer of Ownership generally not permitted. | Generally, deferred earnings taxable to transferor upon transfer or assignment. Gift tax consequences are not discussed herein. | ||||
Federal Income Tax Withholding | Eligible rollover distributions from §401, §403(b), and governmental §457(b) plans are subject to 20% mandatory withholding on taxable portion unless direct rollover. For other payments, Payee may generally elect to have taxes withheld or not. | Generally subject to wage withholding. | Generally, Payee may elect to have taxes withheld or not. |
65
Rollovers, Transfers, and Exchanges
Amounts from a tax-qualified Contract may be rolled over, transferred, or exchanged into another tax-qualified account or retirement plan as permitted by the IRC and plan(s). Amounts may be rolled over, transferred, or exchanged into a tax-qualified Contract from another tax-qualified account or retirement plan as permitted by the IRC and plan(s). In most cases, such a rollover, transfer, or exchange is not taxable, unless the rollover of pre-tax amounts is made into a Roth IRA, a Roth TSA, Roth 401(k), or Roth 457(b). Rollovers, transfers, and exchanges are not subject to normal contribution limits. The IRC or plan may require that rollovers be held in a separate Contract from other plan funds.
Amounts from a non-tax-qualified Contract may be transferred to another non-tax-qualified annuity or to a qualified long-term care policy as a tax-free exchange as permitted by the IRC Section 1035. Amounts from another non-tax-qualified annuity or from a life insurance or endowment policy may be transferred to a Contract as a tax-free exchange under IRC Section 1035.
Required Distributions
The Contracts are subject to the required distribution rules of federal tax law. These rules vary based on the tax qualification of the Contract or the plan under which it is issued.
For a tax-qualified Contract other than a Roth IRA, required minimum distributions must generally begin by April 1 following the year the participant attains age 73 (age 72 if born after June 30, 1949, but before January 1, 1951 or age 70 1/2 if born before July 1, 1949). However, for a 403(b) Tax-Sheltered Annuity Plan, a 401 Pension, Profit-Sharing, or 401(k) Plan, or a 457(b) Governmental Deferred Compensation Plan, a participant who is not a 5% owner of the employer may delay required minimum distributions until April 1 following the year in which the participant retires from that employer. The required minimum distributions during life are calculated based on standard life expectancy tables adopted under federal tax law.
For a Roth IRA or for a Contract that is not tax-qualified, there are no required distributions during life.
A tax-qualified Contract must make required distributions after death. The required distributions vary depending on the type of beneficiary. Some beneficiaries may take payments over life or life expectancy, and others must receive all benefits within five or ten years after death. A non-tax-qualified Contract that has begun making payments under a payout option during the Owners life must make any remaining payments at least as rapidly after death. If payments from a non-tax-qualified Contract have not begun, then the death benefit must be paid out in full within five years after death, or must be paid out in substantially equal payments beginning within one year of death over a period not exceeding the life expectancy of the designated beneficiary.
For a traditional IRA, a Roth IRA, or a Contract that is not tax-qualified, a beneficiary who is a surviving spouse may elect out of these requirements, and apply the required distribution rules as if the Contract were his or her own. For this purpose, federal tax law recognizes as married any two people whose marriage is valid in the state in which it was celebrated. A civil union or domestic partnership is not considered a marriage.
We reserve the right to deduct from the Purchase Payment or Account Value any taxes relating to the Contract paid by us to any government entity (including, but not limited to, premium taxes, additional taxes, and maintenance taxes on insurers, Federal, state and local withholding of income, estate, inheritance, or other taxes required by law from annuity purchase payments, and any new or increased taxes on insurers or annuity purchase payments that may be enacted into law).
Currently some state governments impose premium taxes, additional taxes, and maintenance taxes on insurers based on annuity purchase payments received or applied to an annuity payout benefit. These taxes currently range from zero to 3.5% depending upon the jurisdiction and the tax qualification of the Contract. A federal premium tax has been proposed but not enacted. We may deduct any such premium or other taxes from the Purchase Payments or the Account Value at the time that the tax is imposed. We may also deduct any such tax not previously deducted from the Annuity Payout value or Death Benefit value.
66
We reserve the right to deduct from the Contract for any income taxes that we incur because of the Contract. At the present time, however, we are not incurring any such income tax or making any such deductions.
MM Ascend Investor Services, LLC (MMALIS) is the principal underwriter and distributor of the securities offered through this prospectus. MMALIC and MMALIS are affiliated because MMALIS is a subsidiary of MMALIC. MMALIS also acts as the principal underwriter and distributor of the variable annuity contracts that are issued by one of our subsidiaries.
MMALISs principal executive offices are located at 191 Rosa Parks Street, Cincinnati, Ohio 45202. MMALIS is registered as a broker- dealer with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as well as the securities regulators in the states in which it operates and registration is required. MMALIS is a member of the Financial Industry Regulatory Authority (FINRA).
Contracts are sold by licensed insurance agents (the Selling Agents) in those states where the Contract may be lawfully sold. Such Selling Agents will be appointed agents of MMALIC and will be registered representatives of broker-dealer firms (the Selling Broker-Dealers) that have entered into selling agreements with us and MMALIS. Selling Broker-Dealers will be registered under the Securities Exchange Act of 1934 and will be members of FINRA.
FINRA provides background information about broker-dealers and their registered representatives through FINRA BrokerCheck. You may contact the FINRA BrokerCheck Hotline at 1-800-289-9999, or log on to www.finra.org to learn more about MMALIS, your Selling Agent, and his or her Selling Broker Dealer.
MMALIS receives no compensation for acting as underwriter of the Contracts; however, MMALIC pays for some of MMALISs operating and other expenses, including overhead and legal and accounting fees. MMALIC may reimburse MMALIS for certain sales expenses, such as marketing materials and advertising expenses, and other expenses of distributing the Contracts.
MMALIC or MMALIS pay the Selling Broker-Dealers compensation for the promotion and sale of the Contract. The Selling Agents who solicit sales of the Contract typically receive a portion of the compensation paid to the Selling Broker-Dealers in the form of commissions or other compensation, depending on the agreement between the Selling Broker-Dealer and the Selling Agent.
The amount and timing of commissions paid to Selling Broker-Dealers may vary depending on the selling agreement but it will not be more than 9.2% of each Purchase Payment. In most cases, such amounts paid to a Selling Broker-Dealer will be divided between the Selling Agent and the Selling Broker-Dealer. Some Selling Broker-Dealers may elect to receive a lower commission when a Purchase Payment is made, along with annual trail commissions up to 1.5% of Account Value for so long as a contract remains in effect or as agreed in the selling agreement. MMALIC may pay or allow other promotional incentives or payments in the form of cash or other compensation to the extent permitted by FINRA rules and other applicable laws and regulations.
MMALIC also may pay compensation to wholesaling broker-dealers or other firms or intermediaries in return for wholesaling services such as providing marketing and sales support, product training, and administrative services to the Selling Agents of the Selling Broker-Dealers. These allowances may be based on a percentage of a Purchase Payment.
In addition to the compensation described above, MMALIC may make additional cash payments, in certain circumstances referred to as override compensations, or reimbursements to Selling Broker-Dealers in recognition of their marketing and distribution, transaction processing and/or administrative services support. These payments are not offered to all Selling Broker-Dealers, and the terms of any particular agreement governing the payments may vary among Selling Broker-Dealers depending on, among other things, the level and type of marketing and distribution support provided. Marketing and distribution support services may include, among other services, placement of MMALICs products on the Selling Broker-Dealers preferred or recommended list, increased access to the Selling Broker-Dealers registered representatives for purposes of promoting sales of MMALIC products, assistance in training and education of the Selling Agents, and opportunities for MMALIC and MMALIS to participate in sales conferences and educational seminars. The payments or reimbursements may be calculated as a percentage of the particular Selling Broker-Dealers actual or expected aggregate sales of our indexed annuity contracts (including the Contract) and/or may be a fixed dollar amount. Broker-dealers receiving these additional payments may pass on some or all of the payments to the Selling Agents.
You should ask your Selling Agent for further information about the commissions or other compensation that he or she, or the Selling Broker-Dealer for which he or she works, may receive in connection with your purchase of a Contract.
67
There is no front-end sales load deducted from the Purchase Payment(s) to pay sales commissions. Commissions and other incentives or payments described above are not charged directly to you. We intend to recoup at least a portion of the sales commissions and other sales expenses through fees and charges deducted under the Contract.
MASSMUTUAL ASCEND LIFES GENERAL ACCOUNT
Our general account (the General Account) holds all our assets other than assets in our insulated separate accounts. We own our General Account assets, and, subject to applicable law, have sole investment discretion over them. The assets are subject to our general business operation liabilities and claims of our creditors and may lose value. Our General Account assets fund the guarantees provided in the Contracts.
We must invest our assets according to applicable state laws regarding the nature, quality and diversification of investments that may be made by life insurance companies. In general, these laws permit investments, within specified limits and subject to certain qualifications, in Federal, state and municipal obligations, corporate bonds, preferred and common stocks, real estate mortgages, real estate and certain other investments.
We place a majority of the Purchase Payments made under the Contract in our General Account where we primarily invest the assets in a variety of fixed income securities.
We place a portion of the Purchase Payments made under the Contract in a non-unitized separate account (the Separate Account) that is not registered with the Securities and Exchange Commission. We established and maintain the Separate Account pursuant to the laws of our domiciliary state for the purpose of supporting our obligation to adjust the Indexed Strategy values based on the Daily Value Percentage or rise or fall of the Index. The assets of the Separate Account are held in our name on behalf of the Separate Account and legally belong to us. The assets in the Separate Account are not chargeable with liabilities arising out of any other business that we conduct. We may invest these assets in hedging instruments, including derivative contracts as well as other assets permitted under state law. To support our obligations to adjust the Indexed Strategy values, we may move money between the Separate Account and our General Account. We are not obligated to invest the assets of the Separate Account according to any particular plan except as we may be required to by state insurance laws. Regardless of your Strategy allocations, we do not intend to invest the assets of the Separate Account in the iShares MSCI EAFE exchange traded fund the iShares U.S. Real Estate exchange traded fund, or the SPDR Gold Shares exchange traded fund. We may or may not hold the hypothetical options described in this prospectus in the Separate Account.
Contract owners do not have any interest in or claim on the assets in the Separate Account nor do Contract owners participate in any way in the performance of assets held in the Separate Account.
Reliance on Rule 12h-7
MassMutual Ascend Life relies on the exemption provided by Rule 12h-7 under the Securities Exchange Act of the 1934 Act from the requirement to file reports pursuant to Section 15(d) of that Act.
Legal Proceedings
MassMutual Ascend Life and its subsidiaries are involved in litigation from time to time, generally arising in the ordinary course of business. This litigation may include, but is not limited to, general commercial disputes, lawsuits brought by contract owners and policyholders, employment matters, reinsurance collection matters and actions challenging certain business practices of insurance subsidiaries. Also, from time to time, state and federal regulators or other officials conduct formal and informal examinations or undertake other actions dealing with various aspects of the financial services and insurance industries. It is not possible to predict with certainty the ultimate outcome of any pending legal proceeding or regulatory action. However, MassMutual Ascend Life does not believe any such action or proceeding will have a material adverse effect upon its ability to meet its obligations under the Contracts.
Legal Opinion on Contracts
Legal matters in connection with federal laws and regulations affecting the issue and sale of the Contracts described in this prospectus and the organization of MassMutual Ascend Life, its authority to issue such Contracts under Ohio law, and the validity of the forms of the Contracts under Ohio law have been passed on by John P. Gruber, General Counsel of MassMutual Ascend Life.
Securities and Exchange Commission Position on Indemnification
Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers or persons controlling MassMutual Ascend Life pursuant to its articles of incorporation or its code of regulations or pursuant to any insurance coverage or otherwise, MassMutual Ascend Life has been informed that, in the opinion of the Securities and Exchange Commission, such indemnification is against public policy as expressed in the Securities Act of 1933 and is therefore unenforceable.
68
The statutory financial statements and financial statement schedules of MassMutual Ascend Life Insurance Company as of December 31, 2022, and for the year then ended, have been included herein in reliance upon the report of [ ], independent registered public accounting firm, appearing elsewhere herein, and upon the authority of said firm as experts in accounting and auditing.
The [ ] report dated April [ ], 2023 of MassMutual Ascend Life Insurance Company includes explanatory language that states that the financial statements are prepared by MassMutual Ascend Life Insurance Company using statutory accounting practices prescribed or permitted by the Ohio Department of Insurance, which is a basis of accounting other than U.S. generally accepted accounting principles. Accordingly, the [ ] audit report states that the financial statements are not presented fairly in accordance with U.S. generally accepted accounting principles and further states that those statements are presented fairly, in all material respects, in accordance with statutory accounting practices prescribed or permitted by the Ohio Department of Insurance.
The statutory-basis financial statements of MassMutual Ascend Life Insurance Company as of December 31, 2020 and for each of the two years in the period ended December 31, 2020, appearing in this Prospectus and Registration Statement have been audited by [ ], [address], independent auditors, as set forth in their report included thereon. These statutory-basis financial statements are included in this registration statement in reliance on the report of [ ] given on the authority of such firm as experts in accounting and auditing.
The [ ] report dated May 14, 2021 of MassMutual Ascend Life Insurance Company includes explanatory language that states that the financial statements are prepared by MassMutual Ascend Life Insurance Company using statutory accounting practices prescribed or permitted by the Ohio Department of Insurance, which is a basis of accounting other than U.S. generally accepted accounting principles. Accordingly, the [ ] audit report states that the financial statements are not presented fairly in accordance with U.S. generally accepted accounting principles and further states that those statements are presented fairly, in all material respects, in accordance with statutory accounting practices prescribed or permitted by the Ohio Department of Insurance.
We filed a Registration Statement with the Securities and Exchange Commission under the Securities Act of 1933 relating to the Contracts offered by this prospectus. This prospectus was filed as a part of the Registration Statement, but it does not constitute the complete Registration Statement. The Registration Statement contains further information relating to the Company and the Contracts. The Registration Statement and the exhibits thereto may be inspected and copied at the office of the Securities and Exchange Commission, located at 100 F Street, N.E., Washington, D.C., and may also be accessed at www.sec.gov. The Securities and Exchange Commission file number for the Contract is 333-[ ].
Statements in this prospectus discussing the content of the Contracts and other legal instruments are summaries. The actual documents are filed as exhibits to the Registration Statement. For a complete statement of the terms of the Contracts or any other legal document, refer to the appropriate exhibit to the Registration Statement.
In order to calculate the Daily Value Percentage of an Indexed Strategy, we determine the prices of the hypothetical options using a valuation model. The price of each option is stated as a percentage of the Index for the last Market Close on or before the first day of the Term.
| ATM Call Option Price (at-the-money call option) |
The ATM Call Option Price is the calculated price of a hypothetical call option that will pay the holder an amount equal to the percentage rise, if any, in the Index from the last Market Close on or before the start of the Term to the final Market Close of the Term.
| ATM Put Option Price (at-the-money put option) |
The ATM Put Option Price is the calculated price of a hypothetical put option that will pay the holder an amount equal to the percentage fall, if any, in the Index from the last Market Close on or before the start of the Term to the final Market Close of the Term.
| OTM Call Option Price (out-of-the-money call option) |
The OTM Call Option Price is the calculated price of a hypothetical call option that will pay the holder an amount equal to the percentage rise, if any, in the Index from the last Market Close on or before the start of the Term to the final Market Close of the Term, but only to the extent it exceeds the Cap for the Term.
| OTM Put Option Price (out-of-the-money put option) |
The OTM Put Option Price is the calculated price of a hypothetical put option that will pay the holder an amount equal to the percentage fall, if any, in the Index from the last Market Close on or before the start of the Term to the final Market Close of the Term, but only to the extent it exceeds the Buffer for the Term.
69
Valuation Model
We use a mathematical model to calculate the price of the hypothetical options in our formulas because direct prices of comparable options are generally not available. Options in the marketplace do not directly align with (1) the time remaining in a Term and (2) the strike prices for any of the hypothetical options used in the calculation of the Daily Value Percentage.
Valuation models are widely used for option pricing and the model we use is based on standard methods for valuing derivatives. The methodology used to value these options is determined solely by us and the results of our valuation model may vary, higher or lower, from other estimated valuations or the actual selling price of identical derivatives. Any variance between our valuations and other estimated or actual prices may be different from Indexed Strategy to Indexed Strategy and may also change from day to day. Our valuation model calculates the theoretical price of options using the following inputs: Index levels or prices, expected dividend yield, option strike prices, expected interest rates, time, and implied volatility of option prices. Below is a brief explanation of those model inputs, which we receive from third party vendors.
| Index Levels or Prices |
The initial Index level or price for a Term is the Index provided to us for the last Market Close on or before the first day of the Term. The current Index level or price is the Index provided to us for of the most recent Market Close. We rely on third parties, such as Index providers and financial reporting vendors, to provide us with the current Index level or price for the most recent Market Close.
| Dividend Yield (Div) |
Dividend Yield is the dividend yield to the end of the Term as of a calculation date where the dividend yield is (1) interpolated from yields or (2) implied from market data as reported by Bloomberg or another market source.
For the S&P 500 Index, the dividend yield will reduce the Index level and the applicable call option prices.
| Strike Price (K) |
Strike Price is a value that varies for each type of option.
ATM call option strike price = Index at the start of the Term
ATM put option strike price = Index at the start of the Term
OTM call option strike price = Index at the start of the Term multiplied by (1 + Cap). [For example, if the Cap is 8%, the OTM call option strike price is equal to the Index at the start of the Term multiplied by 1 + .08, or 1.08].
OTM put option strike price = Index at the start of the Term multiplied by (1 Buffer) for a Buffer Strategy or (1 + Floor) for a Floor Strategy. [For example, for a 10% Buffer Strategy, the OTM put option strike price is equal to the Index at the start of the Term multiplied by 1- .10, or .90; for a -10% Floor Strategy, the OTM put option strike price is equal to the Index at the start of the Term multiplied by 1 + -.10, or 0.90]
| Interest Rate (Rate) |
Interest Rate is a rate based on key derivative interest rates obtained from information provided by Bloomberg or another market source. These interest rates are obtained for maturities adjacent to the actual time remaining in the Term on the calculation date. We use interpolation to derive the rate used as our input for the model.
| Time (T) |
Time is the portion of the Term that remains as measured by the following formula.
Time = number of calendar days from calculation date to end of Term / number of calendar days in Term
| Implied Volatility (Vol) |
Volatility is the implied volatility of option prices. It is approximated daily using observed option prices as reported by Bloomberg or another market source. For each hypothetical option included in the calculation, we approximate the volatility of option prices by interpolating between (1) implied volatilities for similar options with the closest available time remaining and (2) strike prices.
Implied volatility varies with (1) how much time remains until the end of a Term, which is determined by using an expiration date for the designated option that corresponds to that time remaining and (2) the relationship between the strike price of that option and the value of the Index at the time of the calculation. This relationship is referred to as the moneyness of the option described above, and is calculated as the ratio of current price to strike price.
70
Direct market data for these inputs is generally not available because options on an Index that actually trade in the market have (1) specific maturity dates that are unlikely to precisely match the end date of a Term and (2) moneyness values that are unlikely to precisely match the moneyness of the designated option that we use in our calculations. Accordingly, we interpolate between the implied volatility quotes that are based on the actual maturities and moneyness values.
71
EXAMPLES: IMPACT OF WITHDRAWALS ON CONTRACT VALUES AND AMOUNTS REALIZED
These examples are intended to show you how a withdrawal from an Indexed Strategy before the end of the Term affects the Indexed Strategy values and amounts realized at the end of the Term.
Example A: Withdrawal When Index Rising Steadily
This example assumes:
| you allocate $50,000 to the S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy, $50,000 to the S&P 500 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy, and $50,000 to the S&P 500 6-Year 10% Buffer with Upside Participation Rate Strategy; |
| the Cap for the initial Term of the S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy is 10%; |
| the Upside Participation Rate for the initial Term of the S&P 500 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy is 75%; |
| the Upside Participation Rate for the Term of the S&P 500 6-Year 10% Buffer with Upside Participation Rate Strategy is 110%; |
| the S&P 500 is 1000 on the Term start date; |
| you request a $10,000 withdrawal on Day 146 when the Daily Value Percentage is 2.15% for the S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy, 2.33% for the S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy, and 10% for the S&P 500 6-year Term 10% Buffer with Participation Rate Strategy; |
| you do not take any other withdrawals during the initial Term; |
| the withdrawal is covered by the Free Withdrawal Allowance and therefore no Early Withdrawal Charges apply (If Early Withdrawal Charges did apply, the amounts realized at the end of the Term would be reduced by both the withdrawal and the amount of the Early Withdrawal Charge); |
| the S&P 500 is 1130 on the 1-year Term end date and the 6-Year Term end date; and |
| you have not made a Performance Lock election. |
Please note that even with a rising Index, the Daily Value Percentage may be negative or lower than the Index rise because the Net Option Price is not equal to the current Index price, and because the Daily Value Percentage calculation subtracts the Amortized Option Cost and Trading Cost from the Net Option Price.
Impact of $10,000 Withdrawal on Day 146 of Term |
S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy |
S&P 500 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy |
S&P 500 6-Year 10% Buffer with Upside Participation Rate Strategy | |||
Investment Base at Term Start | $50,000 | $50,000 | $50,000 | |||
Daily Charges through withdrawal date | $150 | $150 | $150 | |||
Remaining Investment Base | $49,850 | $49,850 | $49,850 | |||
Daily Value Percentage on Withdrawal Date | 2.15% | 2.33% | 10.00% | |||
Dollar Amount of Increase on Withdrawal Date | $49,850 x .0215 = $1,072 | $49,850 x .0233 = $1,162 | $49,850 x .10 = $4,985 | |||
Strategy Value before Withdrawal | $49,850 + $1,072 = $50,922 | $49,850 + $1,162 = $51,012 | $49,850 + $4,985 = $54,835 | |||
Amount Withdrawn* | $4,996 | $5,004 | $0 | |||
Withdrawal as Percentage of Strategy Value | $4,996 / $50,922 = 9.81% | $5,004 / $51,012 = 9.81% | $0 / $54,835 = 0% | |||
Proportional Reduction in Investment Base | $49,850 x .0981 = $4,890 | $49,850 x .0981 = $4,890 | $49,850 x 0 = $0 | |||
Investment Base after Withdrawal | $49,850 - $4,890 = $44,959 | $49,850 - $4,890 = $44,959 | $49,850 - $0 = $49,850 | |||
Value at End of Term | ||||||
Investment Base after Withdrawal | $44,959 | $44,959 | $49,850 | |||
Daily Charges From Withdrawal Date to Term End | $203 | $203 | $2,058 | |||
Remaining Investment Base | $44,757 | $44,757 | $47,792 | |||
Index at Term Start | 1000 | 1000 | 1000 | |||
Index at Term End | 1130 | 1130 | 1130 | |||
Rise in Index | 13% | 13% | 13% | |||
Cap | 10.00% | n/a | n/a | |||
Upside Participation Rate | n/a | 75% | 110% | |||
Increase as a Percentage | 10% | 13% x 75% = 9.75% | 13% x 110% = 14.30% | |||
Dollar Amount of Increase | $44,757 x .1000 = $4,476 | $44,757 x .0975 = $4,364 | $47,792 x .1430 = $6,834 | |||
Strategy Value at Term End | $44,757 + $4,476 = $49,233 | $44,757 + $4,364 = $49,121 | $47,792 + $6,834 = $54,626 |
* | Note: The withdrawal is taken proportionally from each Indexed Strategy, based on the ratio of that Strategys value to the total value of all Indexed Strategies immediately before the withdrawal. In this example, the total value of all Indexed Strategies with 1-year Terms immediately before the withdrawal was $101,934 ($50,922 + $51,012). The S&P 500 1-year 50% Downside Participation Rate with Cap Strategy value was 49.96% of that total value ($50,922 / $101,394 = 49.96%), so 49.96% of the $10,000 withdrawal ($4,996) was taken from it. The S&P 500 with 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy value was 50.04% of that total value ($51,012 / $101,934 = 50.04%), so 50.04% of the $10,000 withdrawal ($5,004) was taken from it. Any withdrawal would only be taken from the S&P 500 6-Year 10% Buffer with Upside Participation Rate Strategy when no amounts remain in Indexed Strategies with a 1-year Term or a 2-year Term. For Contracts issued in Missouri, amounts taken from Indexed Strategies will be proportional without regard to Term length. |
72
In this example, you invested $50,000 in the S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy, $50,000 in the S&P 500 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy, and $50,000 in the S&P 500 6-Year 10% Buffer with Upside Participation Rate Strategy. At the end of the 1-year Term you realized $108,354 from the 1-year Strategies ($10,000 withdrawal plus the Strategy values of $49,233 and $49,121 at the end of the 1-year Term). Had no withdrawal occurred, your 1-year Strategy values at the end of the Term would have totaled $109,051 ($50,000 minus $375 in Daily Charges, plus a 10% increase for the S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy, and $50,000 minus $375 in Daily Charges, plus 9.75% increase for the S&P 500 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy.)
The hypothetical Strategy value for the 1-year Strategies ($109,051) exceeds the amount realized ($108,353) because the portion of the Investment Base withdrawn from each Strategy did not earn the index increase (10% and 9.75% respectively) it would have earned if it had been left in the respective Strategy for the entire Term.
At the end of the 6-year Term you realized $54,626 from the 6-year Strategy, which is the same amount you would have realized had no withdrawal occurred, because no amounts were withdrawn from the 6-year Strategy.
In this example, the S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy performed better than the S&P 500 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy because the Upside Participation Rate limited the increase more than the Cap did. The higher Upside Participation Rate for the S&P 500 6-Year 10% Buffer with Upside Participation Rate Strategy led it to a higher Strategy value at the end of a 6-year Term than the other Strategies had at the end of a 1-year Term.
Example B: Withdrawal When Index Falling Steadily
This example assumes:
| you allocate $50,000 to an S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy (or $50,000 to an S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy, either of which has a 50% Downside Participation Rate) and $50,000 to the S&P 500 6-Year 10% Buffer with Upside Participation Rate Strategy; |
| the S&P 500 is 1000 on the Term start date; |
| you request a $10,000 withdrawal on Day 146 when the Daily Value Percentage is -2.00% for the S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy and -12.00% for the S&P 500 6-Year 10% Buffer with Upside Participation Rate Strategy; |
| you do not take any other withdrawals during the initial Term; |
| the withdrawal is covered by the Free Withdrawal Allowance and therefore no Early Withdrawal Charges apply (If Early Withdrawal Charges did apply, the amounts realized at the end of the Term would be reduced by both the withdrawal and the amount of the Early Withdrawal Charge); |
| the S&P 500 is 800 on the 1-year Term end date and the 6-year Term end date; and |
| you have not made a Performance Lock election. |
Please note that the Daily Value Percentage may be more negative than the fall in the Index because the Net Option Price is not equal to the current Index price, and because the Daily Value Percentage calculation subtracts the Amortized Option Cost and Trading Cost from the Net Option Price.
Impact of $10,000 Withdrawal on Day 146 of Term |
S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy |
S&P 500 6-Year 10% Buffer with Upside Participation Rate Strategy | ||
Investment Base at Term Start |
$50,000 | $50,000 | ||
Daily Charges through withdrawal date |
$150 | $150 | ||
Remaining Investment Base |
$49,850 | $49,850 | ||
Daily Value Percentage on Withdrawal Date |
-2% | -12% | ||
Dollar Amount of Decrease on Withdrawal Date |
$49,850 x -.02 = $997 | $49,850 x -.12 = $5,982 | ||
Strategy Value before Withdrawal |
$49,850 - $997 = $48,853 | $49,850 - $5,982 = $43,868 | ||
Amount Withdrawn* |
$10,000 | $0 | ||
Withdrawal as Percentage of Strategy Value |
$10,000 / $48,853 = 20.47% | $0/ $43,868 = 0% | ||
Proportional Reduction in Investment Base |
$49,850 x .2047 = $10,204 | $49,850 x .0 = $0 | ||
Investment Base after Withdrawal |
$49,850 - $10,204 = $39,646 | $49,850 - $0 = $0 | ||
Value at End of Term |
||||
Investment Base after Withdrawal |
$39,646 | $49,850 | ||
Daily Charges From Withdrawal Date to Term End |
$179 | $2,058 | ||
Remaining Investment Base |
$39,467 | $47,792 | ||
Index at Term Start |
1000 | 1000 | ||
Index at Term End |
800 | 800 | ||
Fall in Index |
20% | 20% | ||
Downside Participation Rate |
50% | n/a | ||
Buffer |
n/a | 10% | ||
Decrease as a Percentage |
-20% x 50% = 10.00% | -20% - 10% = 10.00% | ||
Dollar Amount of Decrease |
$39,467 x .1000 = $3,947 | $47,792 x .1000 = $4,779 | ||
Strategy Value at Term End |
$39,467 - $3,947 = $35,520 | $47,792 - $4,743 = $43,013 |
73
* | Note: The withdrawal is taken proportionally from each Indexed Strategy, based on the ratio of that Strategys value to the total value of all Indexed Strategies immediately before the withdrawal. In this example, only one Indexed Strategy had a 1-year Term, so 100% of the $10,000 withdrawal was taken from it. Any withdrawal would only be taken from the S&P 500 6-year Term Buffer with Participation Rate Strategy value when no amounts remain in Indexed Strategies with a 1-year Term or a 2-year Term. For Contracts issued in Missouri, amounts taken from Indexed Strategies will be proportional without regard to Term length. |
In this example, you invested $50,000 in the S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy and $50,000 in the S&P 500 6-Year Buffer with Upside Participation Rate Strategy. At the end of the 1-year Term you realized $45,520 ($10,000 withdrawal plus the S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy value of $35,520 at the end of the 1-year Term). Had no withdrawal occurred, your Strategy value at the end of the 1-year Term would have totaled $44,663 ($50,000 minus $375 in Daily Charges, minus 10% decrease for the S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy).
At the end of the 6-year Term you realized $43,013, which is the same amount you would have realized had no withdrawal occurred, because no amounts were withdrawn from the 6-year Strategy.
The amount realized at the end of the 1-year Term for the S&P 500 1-year 50% Downside Participation Rate with Cap Strategy ($45,520) exceeds the hypothetical Strategy value at the end of the 1-year Term ($44,663) because the entire $10,000 withdrawal was taken from the 1-year Strategy, and that portion was not subject to the 10% decrease it would have suffered if it had been left in the Strategy for the entire 1-year Term.
The Strategy value for the S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy at the end of a 1-year term ($35,520) is lower than the S&P 500 6-Year Buffer with Upside Participation Rate Strategy at the end of a 6-year Term ($43,013), because the entire $10,000 withdrawal was taken from the 1-year Strategy.
74
Example C: Withdrawal When Index Rises
This example assumes:
| you allocate your entire $50,000 Purchase Payment to the S&P 500 1-year 50% Downside Participation Rate with Cap Strategy when the S&P 500 is 1900; |
| the Contract Effective Date and the Term start date are both April 6, 2024; |
| an Early Withdrawal Charge of 9% applies in the initial Term; |
| the Cap for the initial Term of that Strategy is 12%; |
| you request a $10,000 withdrawal on August 1, 2024 when the Daily Value Percentage is 1%; |
| you do not take any other withdrawals during the initial Term; |
| the S&P 500 is 2033 on the Term end date of April 6, 2025; and |
you have not made a Performance Lock election.
Term Start Date |
April 6, 2024 | |||||||
Strategy Value |
$ | 50,000 | See Footnote 1 below. | |||||
Investment Base |
$ | 50,000 | See Footnote 1 below. | |||||
Cap for Term |
12 | % | See Footnote 2 below. | |||||
Index |
1900 | |||||||
Withdrawal Date |
August 30, 2024 | |||||||
Daily Charges through Withdrawal Date |
$ | 150 | See Footnote 3 below | |||||
Remaining Investment Base |
$ | 49,850 | See Footnote 4 below | |||||
Daily Value Percentage on Withdrawal Date |
1 | % | ||||||
Dollar Amount of Increase on Withdrawal Date |
$ | 499 | See Footnote 5 below. | |||||
Strategy Value before Withdrawal |
$ | 50,349 | See Footnote 6 below. | |||||
Amount of Withdrawal Requested |
$ | 10,000 | ||||||
Free Withdrawal Allowance |
$ | 5,000 | See Footnote 7 below. | |||||
Early Withdrawal Charge |
$ | 495 | See Footnote 8 below. | |||||
Total Amount Withdrawn |
$ | 10,495 | See Footnote 9 below. | |||||
Withdrawal as Percentage of Strategy Value |
20.84 | % | See Footnote 10 below. | |||||
Proportional Reduction in Investment Base |
$ | 10,389 | See Footnote 10 below. | |||||
Investment Base after Withdrawal |
$ | 39,461 | See Footnote 11 below. | |||||
Strategy Value after Withdrawal |
$ | 39,854 | See Footnote 12 below. | |||||
Term End Date |
April 6, 2025 | |||||||
Daily Charges From Withdrawal Date to Term End |
$ | 178 | See Footnote 13 below | |||||
Remaining Investment Base |
$ | 39,283 | See Footnote 14 below | |||||
Index |
2033 | |||||||
Rise in Index |
7.00 | % | See Footnote 15 below. | |||||
Increase as a Percentage |
7.00 | % | See Footnote 16 below. | |||||
Dollar Amount of Increase |
$ | 2,750 | See Footnote 16 below. | |||||
Strategy Value at Term End |
$ | 42,033 | See Footnote 17 below. |
Footnote 1. On the Term start date, the Strategy value is equal to the amount applied to the Strategy on the Term start date. The amount applied on the Term start date is also the beginning Investment Base.
Footnote 2. The Cap is the largest rise in the Index over the Term taken into account to determine any increase at the end of a Term. In this example, the Cap is 12%, which means it will not affect the calculation of any increase unless the Index rises by more than 12%.
Footnote 3. The Daily Charge is the Investment Base from the prior day, multiplied by the Daily Charge rate. The amount in the table is the sum of the daily charges deducted from the Investment Base from the first day of the Term to the withdrawal date.
Formula | Investment Base on the Term Start Date (Investment Base on the Term Start Date x (1 Daily Fee Rate) ^ number of days elapsed prior to withdrawal) | |
Calculation | $50,000 ($50,000 x (1 0.0000206251) ^ 146) = $150 |
Footnote 4. The remaining Investment Base is equal to the beginning Investment Base minus the sum of the Daily Charges and minus the proportional reduction for any prior withdrawals and related Early Withdrawal Charges.
75
Formula | Beginning Investment Base sum of Daily Charges since Term Start Date) proportional reduction for any prior Withdrawals and related Early Withdrawal Charges = remaining Investment Base | |
Calculation | $50,000 - $150 - $0 = $49,850 |
Footnote 5. When the Daily Value Percentage is positive, we use the following formula in calculating the Strategy value before the end of the Term.
Formula | Investment Base x Daily Value Percentage = dollar amount of increase | |
Calculation | $49,850 x 1% = $499 |
Footnote 6. In this example, the Daily Value Percentage is positive on the withdrawal date and you have not taken any withdrawals before that date. This means the Strategy value on the withdrawal date is the Investment Base plus the increase for the Daily Value Percentage on that date.
Formula | Investment Base + dollar amount of increase = Strategy value | |
Calculation | $49,850 + $499 = $50,349 |
Footnote 7. The Free Withdrawal Allowance (FWA) for the first Contract Year is 10% of the Purchase Payment. The FWA for each subsequent Contract Year is 10% of the Account Value as of the most recent Contract Anniversary.
Formula | Purchase Payment x 10% = FWA for first Contract Year | |
Calculation | $50,000 x 10% = $5,000 |
Footnote 8. The Early Withdrawal Charge that would apply to your withdrawal is equal to the amount subject to the charge multiplied by the Early Withdrawal Charge rate (EWC rate). The amount subject to the charge includes the charge itself. The amount subject to the charge does not include the FWA. The EWC rate depends on the Contract Year. In this example, the withdrawal occurs in the first Contract Year, when the EWC rate is 9%. The Early Withdrawal Charge rate declines after each of the first six Contract Years. There is no Early Withdrawal Charge after Contract Year 6.
Formula | [(Requested withdrawal FWA) x EWC rate] / (1.00 EWC rate) = Early Withdrawal Charge | |
Calculation | [($10,000 - $5,000) x 9%] / (1.00 0.09) = $5,000 x 9% / 0.91 = $450 / 0.91 = $495 |
Footnote 9. When you request a withdrawal, you receive the amount you requested. If an Early Withdrawal Charge applies, we also withdraw an amount equal to the charge. This means that the total amount withdrawn from your Contract is equal to the amount you requested plus the applicable Early Withdrawal Charge.
Formula | Requested withdrawal + Early Withdrawal Charge = total amount withdrawn | |
Calculation | $10,000 + $495 = $10,495 |
Footnote 10. When you take a withdrawal, the deduction from the Investment Base taken is proportional to the reduction in the value of the Indexed Strategy due to the withdrawal. If the Strategy value on the withdrawal date is higher than the Investment Base, the proportional reduction in the Investment Base will be less than the total amount withdrawn.
Formula
Calculation |
Total amount withdrawn / Strategy value before withdrawal = withdrawal as percentage of Strategy value
$10,495 / $50,349 = 20.84% | |
Formula | Investment Base before withdrawal x withdrawal as percentage of Strategy value = proportional reduction in Investment Base | |
Calculation | $49,850 x 20.84% = $10,389 |
Footnote 11. On the withdrawal date after the withdrawal, the Investment Base is equal to the Investment Base before the withdrawal minus the proportional reduction in the Investment Base for the withdrawal.
Formula | Investment Base before withdrawal proportional reduction in Investment Base for withdrawal = Investment Base after withdrawal | |
Calculation | $49,850 - $10,389 = $39,461 |
Footnote 12. On the withdrawal date, the Strategy value after the withdrawal is equal to Strategy value before the withdrawal minus the total amount withdrawn.
Formula | Strategy value before withdrawal total amount withdrawn = Strategy value after withdrawal | |
Calculation | $50,349 - $10,495 = $39,854 |
76
Footnote 13. The Daily Charge is the Investment Base from the prior day, multiplied by the Daily Charge rate. The amount in the table is the sum of the daily charges deducted from the Investment Base from the withdrawal date to the last day of the Term.
Formula | Investment Base after Previous Withdrawal (Investment Base after Previous Withdrawal x (1 Daily Fee Rate) ^ Number of Days Elapsed Since Previous Withdrawal) = Daily Charges | |
Calculation | $39,459 ($39,459 x (1 0.0000206251) ^ 219) = $178 |
Footnote 14. The remaining Investment Base is equal to the beginning Investment Base minus the sum of the Daily Charges and minus the proportional reduction for any prior withdrawals and related Early Withdrawal Charges.
Formula | Beginning Investment Base sum of Daily Charges since Term Start Date) proportional reduction for any prior Withdrawals and related Early Withdrawal Charges = remaining Investment Base | |
Calculation | $50,000 ($150 + $178) - $10,389 = $39,283 |
Footnote 15. The rise in the Index on the Term end date is equal to the percentage change in the Index measured from the Term start date to the Term end date.
Formula | (Index on Term end date Index on Term start date) / Index on Term start date = rise in Index | |
Calculation | (2033 1900) / 1900 = 7.00% |
Footnote 16. When the Index has risen over the Term, we use the following formulas to calculate the increase for a 50% Downside Participation Rate with Cap Strategy.
Formula | If the rise in Index is less than Cap, then rise in Index = increase percentage based on rise in Index | |
Calculation | 7% rise in Index < 12% cap, so increase percentage = 7.00% |
Formula | Investment Base x increase percentage based on rise in Index = dollar amount of increase based on rise in Index | |
Calculation | $39,283 x 7.00% = $2,750 |
Footnote 17. In this example, there has been a rise in the Index over the Term and you have taken a $10,000 withdrawal during the Term. This means the Strategy value at the end of the Term is the Investment Base on the Term end date plus the increase for the rise in the Index over the Term.
Formula | Investment Base on Term end date + dollar amount of increase based on rise in Index = Strategy value on Term end date | |
Calculation | $39,283 + $2,750 = $42,033 |
77
Example D: Withdrawal When Index Falls
This example assumes:
| you allocate your entire $50,000 Purchase Payment to the S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy when the S&P 500 is 1900; |
| the Contract Effective Date and the Term Start Date are both April 6, 2024; |
| an Early Withdrawal Charge of 9% applies in the initial Term; |
| you request a $10,000 withdrawal on August 30, 2024 when the Daily Value Percentage is -6%; |
| you do not take any other withdrawals during the initial Term; |
| the S&P 500 is 1748 on the Term end date of April 6, 2025; and |
| you have not made a Performance Lock election |
Term Start Date |
April 6, 2024 | |||||||
Strategy Value |
$ | 50,000 | See Footnote 1 below. | |||||
Investment Base |
$ | 50,000 | See Footnote 1 below. | |||||
Downside Participation Rate |
50 | % | See Footnote 2 below. | |||||
Index |
1900 | |||||||
Withdrawal Date |
August 30, 2024 | |||||||
Daily Charges through Withdrawal Date |
$ | 150 | See Footnote 3 below. | |||||
Remaining Investment Base |
$ | 49,850 | See Footnote 4 below. | |||||
Daily Value Percentage on Withdrawal Date |
-6 | % | ||||||
Dollar Amount of Decrease on Withdrawal Date |
$ | 2,991 | See Footnote 5 below. | |||||
Strategy Value before Withdrawal |
$ | 46,859 | See Footnote 6 below. | |||||
Amount of Withdrawal Requested |
$ | 10,000 | ||||||
Free Withdrawal Allowance |
$ | 5,000 | See Footnote 7 below. | |||||
Early Withdrawal Charge |
$ | 495 | See Footnote 8 below. | |||||
Total Amount Withdrawn |
$ | 10,495 | See Footnote 9 below. | |||||
Withdrawal as Percentage of Strategy Value |
22.40 | % | See Footnote 10 below. | |||||
Proportional Reduction in Investment Base |
$ | 11,166 | See Footnote 10 below. | |||||
Investment Base after Withdrawal |
$ | 38,684 | See Footnote 11 below. | |||||
Strategy Value after Withdrawal |
$ | 36,364 | See Footnote 12 below. | |||||
Term End Date |
April 6, 2025 | |||||||
Daily Charges From Withdrawal Date to Term End |
$ | 174 | See Footnote 13 below. | |||||
Remaining Investment Base |
$ | 38,510 | See Footnote 14 below. | |||||
Index |
1748 | |||||||
Fall in Index |
8.00 | % | See Footnote 15 below. | |||||
Decrease as a Percentage |
4.00 | % | See Footnote 16 below. | |||||
Dollar Amount of Decrease |
$ | 1,540 | See Footnote 16 below. | |||||
Strategy Value at Term End |
$ | 36,970 | See Footnote 17 below. |
Footnote 1. On the Term start date, the Strategy value is equal to the amount applied to the Strategy on the Term start date. The amount applied on the Term start date is also the beginning Investment Base.
Footnote 2. The Downside Participation Rate is your share of any fall in the Index over the Term taken into account to determine any decrease at the end of the Term. For each Term of each Indexed Strategy that we currently offer with this Contract, the Downside Participation Rate is 50%. The Downside Participation Rate will not change from Term to Term.
Footnote 3. The Daily Charge is the Investment Base from the prior day, multiplied by the Daily Charge rate. The amount in the table is the sum of the daily charges deducted from the Investment Base from the first day of the Term to the withdrawal date.
Formula | Investment Base on the Term Start Date (Investment Base on the Term Start Date x (1 Daily Fee Rate) ^ number of days elapsed prior to withdrawal) | |
Calculation | $50,000 - ($50,000 x (1 - 0.0000206251) ^ 146) = $150 |
Footnote 4. The remaining Investment Base is equal to the beginning Investment Base minus the sum of the Daily Charges and minus the proportional reduction for any prior withdrawals and related Early Withdrawal Charges.
Formula | Beginning Investment Base sum of Daily Charges since Term Start Date) proportional reduction for any prior Withdrawals and related Early Withdrawal Charges = remaining Investment Base | |
Calculation | $50,000 - $150 - $0 = $49,850 |
78
Footnote 5. When the Daily Value Percentage is negative, we use the following formula in calculating the Strategy value before the end of the Term.
Formula | - (Investment Base x Daily Value Percentage) = dollar amount of decrease | |
Calculation | - ($49,850 x -6%) = $2,991 |
Footnote 6. In this example, the Daily Value Percentage is negative on the withdrawal date and you have not taken any withdrawals before that date. This means the Strategy value on the withdrawal date is the Investment Base, minus the decrease for the Daily Value Percentage on that date.
Formula | Investment Base dollar amount of decrease = Strategy value | |
Calculation | $49,850 - $2,991 = $46,859 |
Footnote 7. The Free Withdrawal Allowance (FWA) for the first Contract Year is 10% of the Purchase Payment. The FWA for each subsequent Contract Year is 10% of the Account Value as of the most recent Contract Anniversary.
Formula | Purchase Payment x 10% = FWA for first Contract Year | |
Calculation | $50,000 x 10% = $5,000 |
Footnote 8. The Early Withdrawal Charge that would apply to your withdrawal is equal to the amount subject to the charge multiplied by the Early Withdrawal Charge rate (EWC rate). The amount subject to the charge includes the charge itself. The amount subject to the charge does not include the FWA. The EWC rate depends on the Contract Year. In this example, the withdrawal occurs in the first Contract Year, when the EWC rate is 9%. The Early Withdrawal Charge rate declines after each of the first six Contract Years. There is no Early Withdrawal Charge after Contract Year 6.
Formula | [(Requested withdrawal - FWA) x EWC rate] / (1.00 - EWC rate) = Early Withdrawal Charge | |
Calculation | [($10,000 - $5,000) x 9%] / (1.00 - 0.09) = $5,000 x 9% / 0.91 = $450 / 0.91 = $495 |
Footnote 9. When you request a withdrawal, you receive the amount you requested. If an Early Withdrawal Charge applies, we also withdraw an amount equal to the charge. This means that the total amount withdrawn from your Contract is equal to the amount you requested plus the applicable Early Withdrawal Charge.
Formula | Requested withdrawal + Early Withdrawal Charge = total amount withdrawn | |
Calculation | $10,000 + $495 = $10,495 |
Footnote 10. When you take a withdrawal, the deduction from the Investment Base taken is proportional to the reduction in the value of the Indexed Strategy due to the withdrawal. If the Strategy value on the withdrawal date is less than the Investment Base, the proportional reduction in the Investment Base will be more than the total amount withdrawn.
Formula | total amount withdrawn / Strategy value before withdrawal = withdrawal as percentage of Strategy value | |
Calculation | $10,495 / $46,859 = 22.40% | |
Formula | Investment Base before withdrawal x withdrawal as percentage of Strategy value = proportional reduction in Investment Base | |
Calculation | $49,850 x 22.40% = $11,166 |
Footnote 11. On the withdrawal date, the Investment Base after the withdrawal is equal to the Investment Base before the withdrawal minus the proportional reduction in the Investment Base for the withdrawal.
Formula | Investment Base before withdrawal - proportional reduction in Investment Base for withdrawal = Investment Base after withdrawal | |
Calculation | $49,850 - $11,166 = $38,684 |
Footnote 12. On the withdrawal date, the Strategy value after the withdrawal is equal to the Strategy value before the withdrawal minus the total amount withdrawn.
Formula | Strategy value before withdrawaltotal amount withdrawn = Strategy value after withdrawal | |
Calculation | $46,859 - $10,495 = $36,364 |
Footnote 13. The Daily Charge is the Investment Base from the prior day, multiplied by the Daily Charge rate. The amount in the table is the sum of the daily charges deducted from the Investment Base from the withdrawal date to the last day of the Term.
Formula | Investment Base after Previous Withdrawal (Investment Base after Previous Withdrawal x (1 Daily Fee Rate) ^ Number of Days Elapsed Since Previous Withdrawal) = Daily Charges | |
Calculation | $38,685 - ($38,685 x (1 - 0.0000206251) ^ 219) = $174 |
79
Footnote 14. The remaining Investment Base is equal to the beginning Investment Base minus the sum of the Daily Charges and minus the proportional reduction for any prior withdrawals and related Early Withdrawal Charges.
Formula | Beginning Investment Base sum of Daily Charges since Term Start Date) proportional reduction for any prior Withdrawals and related Early Withdrawal Charges = remaining Investment Base | |
Calculation | $50,000 ($150 + $174) - $11,166 = $38,510 |
Footnote 15. The fall in the Index on the Term end date is equal to the negative of the percentage change in the Index measured from the Term start date to the Term end date.
Formula | - (Index on Term end date - Index on Term start date) / Index on Term start date | |
Calculation | - (1748 - 1900) / 1900 = 8.00% |
Footnote 16. When the Index has fallen over the Term, we use the following formula to calculate the decrease.
Formula | Fall in Index x Downside Participation Rate = decrease as a percentage based on fall in Index | |
Calculation | 8.00% x 50% = 4.00% |
Formula | Investment Base x decrease percentage based on fall in Index = dollar amount of decrease based on fall in Index | |
Calculation | $38,510 x 4.00% = $1,540 |
Footnote 17. In this example, there has been a fall in the Index over the Term and you have taken a $10,000 withdrawal during the Term. This means the Strategy value at the end of the Term is the Investment Base on the Term end date minus the decrease for the fall in the Index over the Term.
Formula | Investment Base on Term end date dollar amount of decrease based on fall in Index = Strategy value on Term end date | |
Calculation | $38,510 - $1,540 = $36,970 |
80
Example E: Amount Available for a Withdrawal When Index Rises Less Than Daily Charge Rate
The following example is intended to help you understand the amount that may be available for withdrawal when the Index rises at a rate lower than the amount of the Daily Charge over a Term. In such a scenario, Strategy Values will be lower at the end of a Term than they were at the beginning of the Term, despite the fact that the Index rose over that period.
This example assumes:
| you allocate a $50,000 Purchase Payment to the S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy when the S&P 500 is 1000; |
| you allocate a $50,000 Purchase Payment to the S&P 500 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy when the S&P 500 is 1000; |
| the Contract Effective Date and the Term Start Date are both April 6, 2024; |
| you do not take any withdrawals during the initial Term; and |
| the S&P 500 is 1005 on the Term end date of April 6, 2025. |
Term Start Date - April 6, 2024 |
S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy |
S&P 500 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy |
||||||||||
Strategy Value |
$ | 50,000 | $ | 50,000 | See Footnote 1 below. | |||||||
Investment Base |
$ | 50,000 | $ | 50,000 | See Footnote 1 below. | |||||||
Cap for Term |
10 | % | n/a | See Footnote 2 below. | ||||||||
Upside Participation Rate for Term |
n/a | 75 | % | See Footnote 3 below. | ||||||||
Index |
1000 | 1000 | ||||||||||
Term End Date - April 6, 2025 |
||||||||||||
Daily Charges From Term Start Date to Term End Date |
$ | 375 | $ | 375 | See Footnote 4 below. | |||||||
Remaining Investment Base |
$ | 49,625 | $ | 49,625 | See Footnote 5 below. | |||||||
Index at Term Start Date |
1000 | 1000 | ||||||||||
Index at Term End Date |
1005 | 1005 | ||||||||||
Rise in Index |
0.50 | % | 0.50 | % | See Footnote 6 below. | |||||||
Increase as a Percentage |
0.500 | % | 0.375 | % | See Footnote 7 below. | |||||||
Dollar Amount of Increase |
$ | 248 | $ | 186 | See Footnote 8 below. | |||||||
Strategy Value at Term End |
$ | 49,873 | $ | 49,811 | See Footnote 9 below. |
Footnote 1. On the Term start date, the Strategy value is equal to the amount applied to the Strategy on the Term start date. The amount applied on the Term start date is also the beginning Investment Base.
Footnote 2. The Cap is the largest rise in the Index over the Term taken into account to determine any increase at the end of a Term. In this example, the Cap is 10%, which means it will not affect the calculation of any increase unless the Index rises by more than 10%.
Footnote 3. The Upside Participation Rate is your share of any rise in the Index over the Term taken into account to determine the Strategy value at the end of the Term. In this example, the Upside Participation Rate is 75%, which means the calculation of any increase will include 75% of any Index rise.
Footnote 4. When no withdrawals are taken over the course of a Term, the Daily Charges through the Term End Date are equal to the Investment Base on the Term Start Date times the annual rate at which the Daily Charge compounds.
Formula | Investment Base on Term Start Date x annual rate | |
Calculation | $50,000 x 0.75% = $375 |
Footnote 5. The remaining Investment Base is equal to the beginning Investment Base minus the sum of the Daily Charges and minus the proportional reduction for any prior withdrawals and related Early Withdrawal Charges.
Formula | Beginning Investment Base sum of Daily Charges since Term Start Date proportional reduction for any prior Withdrawals and related Early Withdrawal Charges = remaining Investment Base | |
Calculation | $50,000 - $375 - $0 = $49,625 |
81
Footnote 6. The Rise in Index on the Term End Date is equal to the percentage change in the Index Value measured from the Term Start Date to the Term End Date.
Formula | (Index Value on Term End Date - Index Value on Term Start Date) / Index Value on Term Start Date | |
Calculation | (1005 - 1000) / 1000 = 0.50% |
Footnote 7.
When the Index has risen over the Term, we use the following formulas in calculating the increase for the S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy.
Formula | If the rise in Index is less than Cap, then rise in Index = increase percentage based on rise in Index | |
Calculation | 0.50% rise in Index < 10% cap, so increase percentage = 0.50% |
When the Index has risen over the Term, we use the following formulas to calculate the increase for a Strategy with an Upside Participation Rate.
Formula | Rise in Index for Term x Upside Participation Rate for Term = Increase as a Percentage | |
Calculation | 0.50% x 75% = 0.375% |
Footnote 8.
When the Index has risen over the Term, we use the following formula to calculate the increase.
Formula | Investment Base x increase percentage based on rise in Index = dollar amount of increase based on rise in Index | |
Calculation |
S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy: |
$49,625 x 0.50% = $248 | |
S&P 500 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$49,625 x 0.375% = $186 |
Footnote 9. In this example, there has been a rise in the Index over the Term. This means the Strategy value at the end of the Term is the Investment Base on the Term end date plus the increase for the rise in the Index over the Term.
Formula | Investment Base on Term end date + dollar amount of increase based on rise in Index = Strategy value on Term end date | |
Calculation |
S&P 500 1-Year 50% Downside Participation Rate with Cap : |
$49,625 + $248 = $49,873 | |
S&P 500 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$49,625 + $186 = $49,811 |
82
Example F: Amount Available for a Withdrawal After 6 Years When Index Rises Steadily
The following example is intended to help you understand the amount that may be available for withdrawal for Indexed Strategies that have different Term lengths after a six-year period when the Index rises at a steady rate. In many market conditions, at the end of six years an Indexed Strategy with a six-year Term will outperform Indexed Strategies with shorter Terms that use the same Index.
This example assumes:
| you allocate a $50,000 Purchase Payment to the S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy when the S&P 500 is 1000.00, and the Cap is 10%; |
| you allocate a $50,000 Purchase Payment to the S&P 500 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy when the S&P 500 is 1000, and the Upside Participation Rate is 75%; |
| you allocate a $50,000 Purchase Payment to the S&P 500 6-Year Term 10% Buffer with Upside Participation Rate when the S&P 500 is 1000.00, and the Upside Participation Rate is 130%; |
| the Contract Effective Date and the Term start date are both April 6, 2024, so that the Contract Years and Term Years align; |
| you do not take any withdrawals during the first six Contract Years; |
| amounts allocated to the 1-year strategies are rolled over into the same Indexed Strategy at the end of each 1-year Term, and the Caps and Upside Participation Rates do not change; and |
| on April 6, 2025, the S&P 500 is at 1040.00 and the 6-year Strategy Daily Value Percentage is -2.30%; on April 6, 2026, the S&P 500 is at 1081.60 and the 6-year Strategy Daily Value Percentage is 4.60%; on April 6, 2027, the S&P 500 is at 1124.86 and the 6-year Strategy Daily Value Percentage is 11.70%; on April 6, 2028, the S&P 500 is at 1169.86 and the 6-year Strategy Daily Value Percentage is 19.10%; on April 6, 2029, the S&P 500 is at 1216.65 and the 6-year Strategy Daily Value Percentage is 26.70%; and on April 6, 2030, the S&P 500 is at 1265.32; and |
| you have not made a Performance Lock election |
S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy |
S&P 500 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy |
S&P 500 6-Year 10% Buffer with Upside Participation Rate Strategy |
||||||||||||
Year 1 |
||||||||||||||
Strategy Value - April 6, 2024 |
$ | 50,000 | $ | 50,000 | $ | 50,000 | See Footnote 1 below. | |||||||
Investment Base - April 6, 2024 |
$ | 50,000 | $ | 50,000 | $ | 50,000 | See Footnote 1 below. | |||||||
Daily Charges for Period |
$ | 375 | $ | 375 | $ | 375 | See Footnote 2 below. | |||||||
Remaining Investment Base - April 6, 2025 |
$ | 49,625 | $ | 49,625 | $ | 49,625 | See Footnote 3 below. | |||||||
Rise in Index for Period |
4.00 | % | 4.00 | % | n/a | See Footnote 4 below. | ||||||||
Cap for Period |
10 | % | n/a | n/a | See Footnote 5 below. | |||||||||
Participation Rate for Period |
n/a | 75 | % | n/a | See Footnote 6 below. | |||||||||
Increase as a Percentage |
4.00 | % | 3.00 | % | -2.30 | % | See Footnote 7 below. | |||||||
Dollar Amount of Increase |
$ | 1,985 | $ | 1,489 | -$ | 1,141 | See Footnote 8 below. | |||||||
Strategy Value April 6, 2025 |
$ | 51,610 | $ | 51,114 | $ | 48,484 | See Footnote 9 below. | |||||||
Year 2 |
||||||||||||||
Investment Base April 6, 2025 |
$ | 51,610 | $ | 51,114 | $ | 49,625 | See Footnote 9 below. | |||||||
Daily Charges for Period |
$ | 387 | $ | 383 | $ | 372 | See Footnote 10 below. | |||||||
Remaining Investment Base April 6, 2026 |
$ | 51,223 | $ | 50,731 | $ | 49,253 | See Footnote 11 below. | |||||||
Rise in Index for Period |
4.00 | % | 4.00 | % | n/a | See Footnote 12 below. | ||||||||
Cap for Period |
10 | % | n/a | n/a | See Footnote 13 below. | |||||||||
Participation Rate for Period |
n/a | 75 | % | n/a | See Footnote 14 below. | |||||||||
Increase as a Percentage |
4.00 | % | 3.00 | % | 4.60 | % | See Footnote 15 below. | |||||||
Dollar Amount of Increase |
$ | 2,049 | $ | 1,522 | $ | 2,266 | See Footnote 16 below. | |||||||
Strategy Value - April 6, 2026 |
$ | 53,272 | $ | 52,253 | $ | 51,519 | See Footnote 17 below. | |||||||
Year 3 |
||||||||||||||
Investment Base - April 6, 2026 |
$ | 53,272 | $ | 52,253 | $ | 49,253 | See Footnote 17 below. | |||||||
Daily Charges for Period |
$ | 400 | $ | 392 | $ | 369 | See Footnote 18 below. | |||||||
Remaining Investment Base - April 6, 2027 |
$ | 52,872 | $ | 51,861 | $ | 48,884 | See Footnote 19 below. | |||||||
Rise in Index for Period |
4.00 | % | 4.00 | % | n/a | See Footnote 20 below. | ||||||||
Cap for Period |
10 | % | n/a | n/a | See Footnote 21 below. | |||||||||
Participation Rate for Period |
n/a | 75 | % | n/a | See Footnote 22 below. | |||||||||
Increase as a Percentage |
4.00 | % | 3.00 | % | 11.70 | % | See Footnote 23 below. | |||||||
Dollar Amount of Increase |
$ | 2,115 | $ | 1,556 | $ | 5,719 | See Footnote 24 below. | |||||||
Strategy Value April 6, 2027 |
$ | 54,987 | $ | 53,417 | $ | 54,603 | See Footnote 25 below. |
83
S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy |
S&P 500 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy |
S&P 500 6-Year 10% Buffer with Upside Participation Rate Strategy |
||||||||||||
Year 4 |
||||||||||||||
Investment Base April 6, 2027 |
$ | 54,987 | $ | 53,417 | $ | 48,884 | See Footnote 25 below. | |||||||
Daily Charges for period |
$ | 412 | $ | 401 | $ | 367 | See Footnote 26 below. | |||||||
Remaining Investment Base April 6, 2028 |
$ | 54,575 | $ | 53,016 | $ | 48,517 | See Footnote 27 below. | |||||||
Rise in Index for Period |
4.00 | % | 4.00 | % | n/a | See Footnote 28 below. | ||||||||
Cap for Period |
10 | % | n/a | n/a | See Footnote 29 below. | |||||||||
Participation Rate for Period |
n/a | 75 | % | n/a | See Footnote 30 below. | |||||||||
Increase as a Percentage |
4.00 | % | 3.00 | % | 19.10 | % | See Footnote 31 below. | |||||||
Dollar Amount of Increase |
$ | 2,183 | $ | 1,590 | $ | 9,267 | See Footnote 32 below. | |||||||
Strategy Value April 6, 2028 |
$ | 56,758 | $ | 54,606 | $ | 57,784 | See Footnote 33 below. | |||||||
Year 5 |
||||||||||||||
Investment Base April 6, 2028 |
$ | 56,758 | $ | 54,606 | $ | 48,517 | See Footnote 33 below. | |||||||
Daily Charges for Period |
$ | 426 | $ | 410 | $ | 364 | See Footnote 34 below. | |||||||
Remaining Investment Base April 6, 2029 |
$ | 56,332 | $ | 54,196 | $ | 48,153 | See Footnote 35 below. | |||||||
Rise in Index for Period |
4.00 | % | 4.00 | % | n/a | See Footnote 36 below. | ||||||||
Cap for Period |
10 | % | n/a | n/a | See Footnote 37 below. | |||||||||
Participation Rate for Period |
n/a | 75 | % | n/a | See Footnote 38 below. | |||||||||
Increase as a Percentage |
4.00 | % | 3.00 | % | 26.70 | % | See Footnote 39 below. | |||||||
Dollar Amount of Increase |
$ | 2,253 | $ | 1,626 | $ | 12,857 | See Footnote 40 below. | |||||||
Strategy Value April 6, 2029 |
$ | 58,585 | $ | 55,822 | $ | 61,010 | See Footnote 41 below. | |||||||
Year 6 |
||||||||||||||
Investment Base April 6, 2029 |
$ | 58,585 | $ | 55,822 | $ | 48,153 | See Footnote 41 below. | |||||||
Daily Charges for Period |
$ | 439 | $ | 419 | $ | 361 | See Footnote 42 below. | |||||||
Remaining Investment Base April 6, 2030 |
$ | 58,146 | $ | 55,403 | $ | 47,792 | See Footnote 43 below. | |||||||
Rise in Index for Period |
4.00 | % | 4.00 | % | 26.53 | % | See Footnote 44 below. | |||||||
Cap for Period |
10 | % | n/a | n/a | See Footnote 45 below. | |||||||||
Participation Rate for Period |
n/a | 75 | % | 130 | % | See Footnote 46 below. | ||||||||
Increase as a Percentage |
4.00 | % | 3.00 | % | 34.49 | % | See Footnote 47 below. | |||||||
Dollar Amount of Increase |
$ | 2,326 | $ | 1,662 | $ | 16,483 | See Footnote 48 below. | |||||||
Strategy Value - April 6, 2030 |
$ | 60,472 | $ | 57,065 | $ | 64,275 | See Footnote 49 below. |
Footnote 1. At the beginning of the first Term, the Strategy value is equal to the amount applied to the Strategy on the Term start date. The amount applied on the Term start date is also the beginning Investment Base.
Footnote 2. When no withdrawals are taken over the course of a 1-year Term, the Daily Charges through the Term are equal to the Investment Base on the Term start date times the annual rate at which the Daily Charge compounds. When no withdrawals are taken over the course of a year that is part of a 6-year Term, the Daily Charges for the year are equal to the Investment Base at the Term start date or the most recent Term start date anniversary times the annual rate at which the Daily Charge compounds.
Formula | Investment Base on Term start date or anniversary x annual rate | |
Calculation | $50,000 x 0.75% = $375 for all Indexed Strategies |
Footnote 3. The remaining Investment Base is equal to the beginning Investment Base minus the sum of the Daily Charges and minus the proportional reduction for any prior withdrawals and related Early Withdrawal Charges.
Formula | Beginning Investment Base sum of Daily Charges since beginning of year proportional reduction for any prior Withdrawals and related Early Withdrawal Charges = remaining Investment Base | |
Calculation | $50,000 - $375 - $0 = $49,625 for all Indexed Strategies |
Footnote 4. For the 1-year Strategies, the value at the first Term is based on the rise or fall of the Index over the Term. The rise or fall in the Index for the Term is equal to the percentage change in the Index Value measured from the Term start date to the Term end date.
Formula | (Index Value on Term end date - Index Value on Term start date) / Index Value on Term start date | |
Calculation | (1040.00 1000.00) / 1000.00 = 4.00% |
84
For the 6-year Strategy, the value at the end of Year 1 is based on the Daily Value Percentage, and not the rise or fall in the Index.
Footnote 5. The Cap is the largest rise in the Index over a Term taken into account to determine any increase at the end of the Term. In this example, the S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy has a Cap of 10% for the first Term, which means it will not affect the calculation of any increase unless the Index rises by more than 10% for the Term. The S&P 500 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy and the S&P 500 6-Year 10% Buffer with Upside Participation Rate Strategy do not have a Cap.
Footnote 6. The Upside Participation Rate is your share of any rise in the Index over a Term taken into account to determine the Strategy value at the end of the Term. In this example, the S&P 500 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy has an Upside Participation Rate of 75% for the first Term, which means the calculation of any increase will include 75% of any Index rise for the Term. The S&P 500 6-Year 10% Buffer with Upside Participation Rate Strategy did not complete a Term in Year 1, so no Upside Participation Rate will be applied when determining the Strategy value at the end of Year 1. The S&P 500 1-year 50% Downside Participation Rate with Cap Strategy does not have an Upside Participation Rate.
Footnote 7.
When the Index has risen over a Term, we use the following formulas to calculate the increase for the 1-year Strategy with a Cap.
Formula | If the rise in Index is less than Cap, then rise in Index = increase percentage based on rise in Index | |
Calculation | 4.0% rise in Index < 10% cap, so increase percentage = 4.0% |
When the Index has risen over a Term, we use the following formulas to calculate the increase for the 1-year Strategy with an Upside Participation Rate.
Formula | Rise in Index for Term x Upside Participation Rate for Term = Increase as a Percentage | |
Calculation | 4.0% x 75% = 3.0% |
For the S&P 500 6-year 10% Buffer with Upside Participation Rate Strategy, the Upside Participation Rate only applies at the end of the 6-year Term. At the end of Year 1, the Strategy Value is determined based on the Daily Value Percentage. The Daily Value Percentage may be more or less than the cumulative rise or fall of the Index since the Term start date, and it may be negative even when the Index has risen. In our example, the Daily Value Percentage at the end of Year 1 is -2.30%.
Footnote 8.
For a 1-year Strategy, when the Index has risen over the Term, we use the following formula to calculate the increase.
Formula | Remaining Investment Base x increase percentage based on rise in Index = dollar amount of increase based on rise in Index | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$49,625 x 4.00% = $1,985 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$49,625 x 3.00% = $1,489 |
For the 6-year Strategy, when the Daily Value Percentage is negative, we use the following formula to calculate the amount of the decrease.
Formula | Remaining Investment Base x Daily Value Percentage = dollar amount of change based on Daily Value Percentage | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$49,625 x -2.30% = -$1,141 |
Footnote 9. In this example, for the 1-year Strategies, there has been a rise in the Index over the first Term. We use the following formula to calculate the Strategy value at the end of Year 1.
Formula | Remaining Investment Base on Term end date + dollar amount of increase based on rise in Index = Strategy value on Term end date | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$49,625 + $1,985 = $51,610 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$49,625 + $1,489 = $51,114 |
85
For the 6-year Strategy, the Daily Value Percentage is negative at the end of Year 1. We use the following formula to calculate the Strategy value.
Formula | Remaining Investment Base on valuation date - dollar amount of decrease based on Daily Value Percentage = current Strategy value | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$49,625 - $1,141 = $48,484 |
For the 1-year Strategies, the Strategy value at the end of the first Term is also the Investment Base at the beginning of the second Term. For the 6-year Strategy, the existing Investment Base is carried forward because it is not the end of a Term.
Footnote 10. When no withdrawals are taken over the course of a 1-year Term, the Daily Charges through the Term end date are equal to the Investment Base on the Term start date times the annual rate at which the Daily Charge compounds. When no withdrawals are taken over the course of a year that is part of a 6-year Term, the Daily Charges for the year are equal to the Investment Base at the Term start date or the most recent Term start date anniversary times the annual rate at which the Daily Charge compounds.
Formula | Investment Base on Term start date or anniversary x annual rate | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$51,610 x 0.75% = $387 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$51,114 x 0.75% = $383 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$49,625 x 0.75% = $372 |
Footnote 11. The remaining Investment Base is equal to the beginning Investment Base minus the sum of the Daily Charges and minus the proportional reduction for any prior withdrawals and related Early Withdrawal Charges.
Formula | Beginning Investment Base sum of Daily Charges since beginning of year proportional reduction for any prior Withdrawals and related Early Withdrawal Charges = remaining Investment Base | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$51,160 - $387 - $0 = $51,223 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$51,114 - $383 - $0 = $50,731 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$49,625 - $372 - $0 = $49,253 |
Footnote 12. For a 1-year Strategy, the value at the end of the second Term is based on the rise or fall in the index over the Term. The rise or fall in Index for the Term is equal to the percentage change in the Index Value measured from the Term start date to the Term end date.
Formula | (Index Value on Term end date - Index Value on Term start date) / Index Value on Term start date | |
Calculation | (1081.60 1040.00) / 1040.00 = 4.00% |
For the 6-year Strategy, the value at the end of Year 2 is based on the Daily Value Percentage, and not the rise or fall in the Index.
Footnote 13. The Cap is the largest rise in the Index over a Term taken into account to determine any increase at the end of the Term. In this example, the 1-year 50% Downside Participation Rate with Cap Strategy has a Cap of 10% for the second Term, which means it will not affect the calculation of any increase unless the Index rises by more than 10% for the Term. The 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy and the 6-year 10% Buffer with Upside Participation Rate Strategy do not have a Cap.
Footnote 14. The Upside Participation Rate is your share of any rise in the Index over a Term taken into account to determine the Strategy value at the end of the Term. In this example, the 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy has an Upside Participation Rate of 75% for the second Term, which means the calculation of any increase will include 75% of any Index rise for the Term. The 6-year 10% Buffer with Upside Participation Rate Strategy did not complete a Term in Year 2, so no Upside Participation Rate will be applied when determining the Strategy value at the end of Year 2. The 1-year 50% Downside Participation Rate with Cap Strategy does not have an Upside Participation Rate.
86
Footnote 15.
When the Index has risen over a Term, we use the following formulas to calculate the increase for the 1-year Strategy with a Cap.
Formula | If the rise in Index is less than Cap, then rise in Index = increase percentage based on rise in Index | |
Calculation | 4.00% rise in Index < 10% cap, so increase percentage = 4.00% |
When the Index has risen over a Term, we use the following formulas to calculate the increase for the 1-year Strategy with an Upside Participation Rate.
Formula | Rise in Index for Term x Upside Participation Rate for Term = Increase as a Percentage | |
Calculation | 4.00% x 75% = 3.00% |
For the S&P 500 6-year 10% Buffer with Upside Participation Rate Strategy, the Upside Participation Rate only applies at the end of the 6-year Term. At the end of Year 1, the Strategy Value is determined based on the Daily Value Percentage. The Daily Value Percentage may be more or less than the cumulative rise or fall of the Index since the Term start date, and it may be negative even when the Index has risen. In our example, the Daily Value Percentage at the end of Year 2 is 4.60%.
Footnote 16.
For a 1-year Strategy, when the Index has risen over the Term, we use the following formula to calculate the increase.
Formula | Remaining Investment Base x increase percentage based on rise in Index = dollar amount of increase based on rise in Index | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$51,223 x 4.00% = $2,049 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$50,731 x 3.00% = $1,522 |
For the 6-year Strategy, when the Daily Value Percentage is positive, we use the following formula to calculate the amount of the increase.
Formula | Remaining Investment Base x Daily Value Percentage = dollar amount of increase based on Daily Value Percentage | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$49,253 x 4.60% = $2,266 |
Footnote 17. In this example, for the 1-year Strategies, there has been a rise in the Index over the second Term. We use the following formula to calculate the Strategy value at the end of Year 2.
Formula | Remaining Investment Base on Term end date + dollar amount of increase based on rise in Index = Strategy value on Term end date | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$51,223 + $2,049 = $53,272 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$50,731 + $1,522 = $52,253 |
For the 6-year Strategy, the Daily Value Percentage is positive at the end of Year 2. We use the following formula to calculate the Strategy value.
Formula | Remaining Investment Base on valuation date + dollar amount of increase based on Daily Value Percentage = current Strategy value | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$49,253 + $2,266 = $51,519 |
87
For the 1-year Strategies, the Strategy value at the end of the second Term is also the Investment Base at the beginning of the third Term. For the 6-year Strategy, the existing Investment Base is carried forward because it is not the end of a Term.
Footnote 18. When no withdrawals are taken over the course of a 1-year Term, the Daily Charges through the Term end date are equal to the Investment Base on the Term start date times the annual rate at which the Daily Charge compounds. When no withdrawals are taken over the course of a year that is part of a 6-year Term, the Daily Charges for the year are equal to the Investment Base at the Term start date or the most recent Term start date anniversary times the annual rate at which the Daily Charge compounds.
Formula | Investment Base on Term start date or anniversary x annual rate | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$53,272 x 0.75% = $400 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$52,253 x 0.75% = $392 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$49,253 x 0.75% = $369 |
Footnote 19. The remaining Investment Base is equal to the beginning Investment Base minus the sum of the Daily Charges and minus the proportional reduction for any prior withdrawals and related Early Withdrawal Charges.
Formula | Beginning Investment Base sum of Daily Charges since beginning of year proportional reduction for any prior Withdrawals and related Early Withdrawal Charges = remaining Investment Base | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$53,272 - $400 - $0 = $52,872 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: | $52,253 - $392 - $0 = $51,861 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$49,253 - $369 - $0 = $48,884 |
Footnote 20. For a 1-year Strategy, the value at the end of the third Term is based on the rise or fall in the index over the Term. The rise or fall in Index for the Term is equal to the percentage change in the Index Value measured from the Term start date to the Term end date.
Formula | (Index Value on Term end date - Index Value on Term start date) / Index Value on Term start date | |
Calculation | (1124.86- 1081.60) / 1081.60 = 4.00% |
For the 6-year Strategy, the value at the end of Year 3 is based on the Daily Value Percentage, and not the rise or fall in the Index.
Footnote 21. The Cap is the largest rise in the Index over a Term taken into account to determine any increase at the end of the Term. In this example, the 1-year 50% Downside Participation Rate with Cap Strategy has a Cap of 10% for the third Term, which means it will not affect the calculation of any increase unless the Index rises by more than 10% for the Term. The 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy and the 6-year 10% Buffer with Upside Participation Rate Strategy do not have a Cap.
Footnote 22. The Upside Participation Rate is your share of any rise in the Index over a Term taken into account to determine the Strategy value at the end of the Term. In this example, the 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy has an Upside Participation Rate of 75% for the third Term, which means the calculation of any increase will include 75% of any Index rise for the Term. The 6-year 10% Buffer with Upside participation Rate Strategy did not complete a Term in Year 3, so no Upside Participation Rate will be applied when determining the Strategy value at the end of Year 3. The 1-year 50% Downside Participation Rate with Cap Strategy does not have an Upside Participation Rate.
Footnote 23.
When the Index has risen over a Term, we use the following formulas to calculate the increase for the 1-year Strategy with a Cap.
Formula | If the rise in Index is less than Cap, then rise in Index = increase percentage based on rise in Index | |
Calculation | 4.00% rise in Index < 10% cap, so increase percentage = 4.00% |
When the Index has risen over a Term, we use the following formulas to calculate the increase for the 1-year Strategy with an Upside Participation Rate.
88
Formula | Rise in Index for Term x Upside Participation Rate for Term = Increase as a Percentage | |
Calculation | 4.00% x 75% = 3.00% |
For the S&P 500 6-year 10% Buffer with Upside Participation Rate Strategy, the Upside Participation Rate only applies at the end of the 6-year Term. At the end of Year 1, the Strategy Value is determined based on the Daily Value Percentage. The Daily Value Percentage may be more or less than the cumulative rise or fall of the Index since the Term start date, and it may be negative even when the Index has risen. In our example, the Daily Value Percentage at the end of Year 3 is 11.70%.
Footnote 24.
For a 1-year Strategy, when the Index has risen over the Term, we use the following formula to calculate the increase.
Formula | Remaining Investment Base x increase percentage based on rise in Index = dollar amount of increase based on rise in Index | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$52,872 x 4.00% = $2,115 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: | $51,861 x 3.00% = $1,556 |
For the 6-year Strategy, when the Daily Value Percentage is positive, we use the following formula to calculate the amount of the increase.
Formula | Remaining Investment Base x Daily Value Percentage = dollar amount of increase based on Daily Value Percentage | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,884 x 11.70% = $5,719 |
Footnote 25. In this example, for the 1-year Strategies, there has been a rise in the Index over the third Term. We use the following formula to calculate the Strategy value at the end of Year 3.
Formula | Remaining Investment Base on Term end date + dollar amount of increase based on rise in Index = Strategy value on Term end date | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$52,872 + $2,115 = $54,987 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: | $51,861 + $1,556 = $53,417 |
For the 6-year Strategy, the Daily Value Percentage is positive at the end of Year 3. We use the following formula to calculate the Strategy value.
Formula | Remaining Investment Base on valuation date + dollar amount of increase based on Daily Value Percentage = current Strategy value | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,884 + $5,719 = $54,603 |
For the 1-year Strategies, the Strategy value at the end of the third Term is also the Investment Base at the beginning of the fourth Term. For the 6-year Strategy, the existing Investment Base is carried forward because it is not the end of a Term.
Footnote 26. When no withdrawals are taken over the course of a 1-year Term, the Daily Charges through the Term are equal to the Investment Base on the Term start date times the annual rate at which the Daily Charge compounds. When no withdrawals are taken over the course of a year that is part of a 6-year Term, the Daily Charges for the year are equal to the Investment Base at the Term start date or the most recent Term start date anniversary times the annual rate at which the Daily Charge compounds.
Formula | Investment Base on Term start date or anniversary x annual rate | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$54,987 x 0.75% = $412 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$53,417 x 0.75% = $401 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,884 x 0.75% = $367 |
89
Footnote 27. The remaining Investment Base is equal to the beginning Investment Base minus the sum of the Daily Charges and minus the proportional reduction for any prior withdrawals and related Early Withdrawal Charges.
Formula | Beginning Investment Base sum of Daily Charges since beginning of year proportional reduction for any prior Withdrawals and related Early Withdrawal Charges = remaining Investment Base | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$54,987 - $412 - $0 = $54,575 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: | $53,416 - $401 - $0 = $53,016 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,883 - $367 - $0 = $48,517 |
Footnote 28. For a 1-year Strategy, the value at the end of the fourth Term is based on the rise or fall in the index over the Term. The rise or fall in Index for the Term is equal to the percentage change in the Index Value measured from the Term start date to the Term end date.
Formula | (Index Value on Term end date - Index Value on Term start date) / Index Value on Term start date | |
Calculation | (1169.86 - 1125) / 1124.86 = 4.00% |
For the 6-year Strategy, the value at the end of Year 4 is based on the Daily Value Percentage, and not the rise or fall in the Index.
Footnote 29. The Cap is the largest rise in the Index over a Term taken into account to determine any increase at the end of the Term. In this example, the 1-year 50% Downside Participation Rate with Cap Strategy has a Cap of 10% for the fourth Term, which means it will not affect the calculation of any increase unless the Index rises by more than 10% for the Term. The 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy and the 6-year 10% Buffer with Upside Participation Rate Strategy do not have a Cap.
Footnote 30. The Upside Participation Rate is your share of any rise in the Index over a Term taken into account to determine the Strategy value at the end of the Term. In this example, the 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy has an Upside Participation Rate of 75% for the fourth Term, which means the calculation of any increase will include 75% of any Index rise for the Term. The 6-year 10% Buffer with Upside Participation Rate Strategy did not complete a Term in Year 4, so no Upside Participation Rate will be applied when determining the Strategy value at the end of Year 4. The 1-year 50% Downside Participation Rate with Cap Strategy does not have an Upside Participation Rate.
Footnote 31.
When the Index has risen over a Term, we use the following formulas to calculate the increase for the 1-year Strategy with a Cap.
Formula | If the rise in Index is less than Cap, then rise in Index = increase percentage based on rise in Index | |
Calculation | 4.00% rise in Index < 10% cap, so increase percentage = 4.00% |
When the Index has risen over a Term, we use the following formulas to calculate the increase for the 1-year Strategy with an Upside Participation Rate.
Formula | Rise in Index for Term x Upside Participation Rate for Term = Increase as a Percentage | |
Calculation | 4.00% x 75% = 3.00% |
For the S&P 500 6-year Buffer with an Upside Participation Rate Strategy, the Upside Participation Rate only applies at the end of the 6-year Term. At the end of Year 1, the Strategy Value is determined based on the Daily Value Percentage. The Daily Value Percentage may be more or less than the cumulative rise or fall of the Index since the Term start date, and it may be negative even when the Index has risen. In our example, the Daily Value Percentage at the end of Year 4 is 19.10%.
90
Footnote 32.
For a 1-year Strategy, when the Index has risen over the Term, we use the following formula to calculate the increase.
Formula | Remaining Investment Base x increase percentage based on rise in Index = dollar amount of increase based on rise in Index | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$54,575 x 4.00% = $2,183 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$53,016 x 3.00% = $1,590 |
For the 6-year Strategy, when the Daily Value Percentage is positive, we use the following formula to calculate the amount of the increase.
Formula | Remaining Investment Base x Daily Value Percentage = dollar amount of increase based on Daily Value Percentage | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,517 x 19.10% = $9,267 |
Footnote 33. In this example, for the 1-year Strategies, there has been a rise in the Index over the fourth Term. We use the following formula to calculate the Strategy value at the end of Year 4.
Formula | Remaining Investment Base on Term end date + dollar amount of increase based on rise in Index = Strategy value on Term end date | |
Calculation |
1-year 50% Downside Participation Rate with Cap 50% Downside Participation Rate with Cap Strategy: |
$54,575 + $2,183 = $56,758 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$53,016 + $1,590 = $54,606 |
For the 6-year Strategy, the Daily Value Percentage is positive at the end of Year 4. We use the following formula to calculate the Strategy value.
Formula | Remaining Investment Base on valuation date + dollar amount of increase based on Daily Value Percentage = current Strategy value | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,517 + $9,267 = $57,784 |
For the 1-year Strategies, the Strategy value at the end of the fourth Term is also the Investment Base at the beginning of the fifth Term. For the 6-year Strategy, the existing Investment Base is carried forward because it is not the end of a Term.
Footnote 34. When no withdrawals are taken over the course of a 1-year Term, the Daily Charges through the Term are equal to the Investment Base on the Term start date times the annual rate at which the Daily Charge compounds. When no withdrawals are taken over the course of a year that is part of a 6-year Term, the Daily Charges for the year are equal to the Investment Base at the Term start date or the most recent Term start date anniversary times the annual rate at which the Daily Charge compounds.
Formula | Investment Base on Term start date or anniversary x annual rate | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$56,758 x 0.75% = $426 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$54,606 x 0.75% = $410 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,517 x 0.75% = $364 |
Footnote 35. The remaining Investment Base is equal to the beginning Investment Base minus the sum of the Daily Charges and minus the proportional reduction for any prior withdrawals and related Early Withdrawal Charges.
Formula | Beginning Investment Base sum of Daily Charges since beginning of year proportional reduction for any prior Withdrawals and related Early Withdrawal Charges = remaining Investment Base |
91
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy with a Cap: |
$56,758 - $426 - $0 = $56,332 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$54,606 - $410 - $0 = $54,196 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,517 - $364 - $0 = $48,153 |
Footnote 36. For a 1-year Strategy, the value at the end of the fifth Term is based on the rise or fall in the index over the Term. The rise or fall in Index for the Term is equal to the percentage change in the Index Value measured from the Term start date to the Term end date.
Formula | (Index Value on Term end date - Index Value on Term start date) / Index Value on Term start date | |
Calculation | (1216.65 1169.86) / 1169.86 = 4.00% |
For the 6-year Strategy, the value at the end of Year 5 is based on the Daily Value Percentage, and not the rise or fall in the Index.
Footnote 37. The Cap is the largest rise in the Index over a Term taken into account to determine any increase at the end of the Term. In this example, the 1-year 50% Downside Participation Rate with Cap Strategy has a Cap of 10% for the fifth Term, which means it will not affect the calculation of any increase unless the Index rises by more than 10% for the Term. The 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy and the 6-year 10% Buffer with Upside Participation Rate Strategy do not have a Cap.
Footnote 38. The Upside Participation Rate is your share of any rise in the Index over a Term taken into account to determine the Strategy value at the end of the Term. In this example, the 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy has an Upside Participation Rate of 75% for the fifth Term, which means the calculation of any increase will include 75% of any Index rise for the Term. The 6-year 10% Buffe with Upside Participation Rate Strategy did not complete a Term in Year 5, so no Upside Participation Rate will be applied when determining the Strategy value at the end of Year 5. The 1-year 50% Downside Participation Rate with Cap Strategy does not have an Upside Participation Rate.
Footnote 39.
When the Index has risen over a Term, we use the following formulas to calculate the increase for the 1-year Strategy with a Cap.
Formula | If the rise in Index is less than Cap, then rise in Index = increase percentage based on rise in Index | |
Calculation | 4.0% rise in Index < 10% cap, so increase percentage = 4.0% |
When the Index has risen over a Term, we use the following formulas to calculate the increase for the 1-year Strategy with an Upside Participation Rate.
Formula | Rise in Index for Term x Upside Participation Rate for Term = Increase as a Percentage | |
Calculation | 4.00% x 75% = 3.00% |
For the 6-year Strategy with an Upside Participation Rate, the Upside Participation Rate only applies at the end of the 6-year Term. At the end of Year 1, the Strategy Value is determined based on the Daily Value Percentage. The Daily Value Percentage may be more or less than the cumulative rise or fall of the Index since the Term start date, and it may be negative even when the Index has risen. In our example, the Daily Value Percentage at the end of Year 5 is 26.70%.
Footnote 40.
For a 1-year Strategy, when the Index has risen over the Term, we use the following formula to calculate the increase.
Formula | Remaining Investment Base x increase percentage based on rise in Index = dollar amount of increase based on rise in Index | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$56,332 x 4.00% = $2,253 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$54,196 x 3.00% = $1,626 |
For the 6-year Strategy, when the Daily Value Percentage is positive, we use the following formula to calculate the amount of the increase.
Formula | Remaining Investment Base x Daily Value Percentage = dollar amount of increase based on Daily Value Percentage | |
Calculation |
6-year 10% Buffer with Upside Participation
Rate |
$48,153 x 26.70% = $12,857 |
92
Footnote 41. In this example, for the 1-year Strategies, there has been a rise in the Index over the fifth Term. We use the following formula to calculate the Strategy value at the end of Year 5.
Formula | Remaining Investment Base on Term end date + dollar amount of increase based on rise in Index = Strategy value on Term end date | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$56,332 + $2,253 = $58,585 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$54,196 + $1,626 = $55,822 |
For the 6-year Strategy, the Daily Value Percentage is positive at the end of Year 5. We use the following formula to calculate the Strategy value.
Formula | Remaining Investment Base on valuation date + dollar amount of increase based on Daily Value Percentage = current Strategy value | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,153 + $12,857 = $61,010 |
For the 1-year Strategies, the Strategy value at the end of the fifth Term is also the Investment Base at the beginning of the sixth Term. For the 6-year Strategy, the existing Investment Base is carried forward because it is not the end of a Term.
Footnote 42. When no withdrawals are taken over the course of a 1-year Term, the Daily Charges through the Term are equal to the Investment Base on the Term start date times the annual rate at which the Daily Charge compounds. When no withdrawals are taken over the course of a year that is part of a 6-year Term, the Daily Charges for the year are equal to the Investment Base at the Term start date or the most recent Term start date anniversary times the annual rate at which the Daily Charge compounds.
Formula | Investment Base on Term start date or anniversary x annual rate | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$58,585 x 0.75% = $439 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$55,822 x 0.75% = $419 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,153 x 0.75% = $361 |
Footnote 43. The remaining Investment Base is equal to the beginning Investment Base minus the sum of the Daily Charges and minus the proportional reduction for any prior withdrawals and related Early Withdrawal Charges.
Formula | Beginning Investment Base sum of Daily Charges since beginning of year proportional reduction for any prior Withdrawals and related Early Withdrawal Charges = remaining Investment Base | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$58,585 - $439 - $0 = $58,146 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$55,822 - $419 - $0 = $55,403 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,153 - $361 - $0 = $47,792 |
Footnote 44. For a 1-year Strategy, the value at the end of the sixth Term is based on the rise or fall in the index over the Term. The rise or fall in Index for the Term is equal to the percentage change in the Index Value measured from the Term start date to the Term end date.
Formula | (Index Value on Term end date - Index Value on Term start date) / Index Value on Term start date | |
Calculation | (1265.32 1216.65) / 1216.65 = 4.00% |
For the 6-year Strategy, the value at the end of the Term is based on the rise or fall in the index over the entire 6-year Term. The rise or fall in the Index for the Term is equal to the percentage change in the Index Value measured from the Term start date to the Term end date.
Formula | (Index Value on Term end date - Index Value on Term start date) / Index Value on Term start date | |
Calculation | (1265.32 1000.00) / 1000.00 = 26.53% |
93
Footnote 45. The Cap is the largest rise in the Index over a Term taken into account to determine any increase at the end of the Term. In this example, the 1-year 50% Downside Participation Rate with Cap Strategy has a Cap of 10% for the sixth Term, which means it will not affect the calculation of any increase unless the Index rises by more than 10% for the Term. The 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy and the 6-year 10% Buffer with Upside Participation Rate Strategy do not have a Cap.
Footnote 46. The Upside Participation Rate is your share of any rise in the Index over a Term taken into account to determine the Strategy value at the end of the Term. In this example, the 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy has an Upside Participation Rate of 75% for the sixth Term, which means the calculation of any increase will include 75% of any Index rise for the Term. The 6-year 10% Buffer with Upside Participation Rate Strategy has an Upside Participation Rate of 130% for the 6-year Term, which means the calculation of any increase will include 130% of any Index rise for the term. The 1-year 50% Downside Participation Rate with Cap Strategy does not have an Upside Participation Rate.
Footnote 47.
When the Index has risen over a Term, we use the following formulas to calculate the increase for the 1-year Strategy with a Cap.
Formula | If the rise in Index is less than Cap, then rise in Index = increase percentage based on rise in Index | |
Calculation | 4.00% rise in Index < 10% cap, so increase percentage = 4.00% |
When the Index has risen over a Term, we use the following formulas to calculate the increase for the 1-year Strategy with an Upside Participation Rate.
Formula | Rise in Index for Term x Upside Participation Rate for Term = Increase as a Percentage | |
Calculation | 4.00% x 75% = 3.00% |
When the Index has risen over a Term, we use the following formulas to calculate the increase for the 6-year Strategy with an Upside Participation Rate.
Formula | Rise in Index for Term x Upside Participation Rate for Term = Increase as a Percentage | |
Calculation | 26.53% x 130% = 34.49% |
Footnote 48.
When the Index has risen over the Term, we use the following formula to calculate the increase.
Formula | Remaining Investment Base x increase percentage based on rise in Index = dollar amount of increase based on rise in Index | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$58,146 x 4.0% = $2,326 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$55,403 x 3.00% = $1,662 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$47,792 x 34.49% = $16,483 |
Footnote 49. In this example, for the 1-year Strategies, there has been a rise in the Index over the sixth Term. For the 6-year Strategy, there has also been a rise in the index over its 6-year Term. This means that both for a 1-year Strategy and the 6-year Strategy, the Strategy value at the end of Year 6 is the Remaining Investment Base on the Term end date plus the increase for the rise in the Index over the Term.
Formula | Remaining Investment Base on Term end date + dollar amount of increase based on rise in Index = Strategy value on Term end date | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$58,146 + $2,326 = $60,472 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$55,403 + $1,662 = $57,065 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$47,792 + $16,483 = $64,275 |
94
Example G: Amount Available for a Withdrawal After 6 Years When Index Falls Steadily
The following example is intended to help you understand the amount that may be available for withdrawal for Indexed Strategies that have different Term lengths after a six-year period when the Index falls at a steady rate.
This example assumes:
| you allocate a $50,000 Purchase Payment to the S&P 500 1-Year 50% Downside Participation Rate with Cap Strategy when the S&P 500 is 1000.00; |
| you allocate a $50,000 Purchase Payment to the S&P 500 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy when the S&P 500 is 1000.00; |
| you allocate a $50,000 Purchase Payment to the S&P 500 6-Year 10% Buffer with Upside Participation Rate Strategy when the S&P 500 is 1000.00; |
| the Contract Effective Date and the Term start date are both April 6, 2024, so that the Contract Years and Term Years align; |
| you do not take any withdrawals during the first six Contract Years; |
| amounts allocated to the 1-year strategies are rolled over into the same Indexed Strategy at the end of each 1-year Term; and |
| on April 6, 2025, the S&P 500 is at 960.00 and the 6-year Strategy Daily Value Percentage is -4.50%; on April 6, 2026, the S&P 500 is at 921.60 and the 6-year Strategy Daily Value Percentage is -4.90%; on April 6, 2027, the S&P 500 is at 884.74 and the 6-year Strategy Daily Value Percentage is -6.00%; on April 6, 2028, the S&P 500 is at 849.35 and the 6-year Strategy Daily Value Percentage is -8.10%; on April 6, 2029, the S&P 500 is at 815.37 and the 6-year Strategy Daily Value Percentage is -10.00%; and on April 6, 2030, the S&P 500 is at 782.76; and |
| you have not made a Performance Lock election. |
S&P 500 1-year 50% Downside Participation Rate with Cap Strategy |
S&P 500 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy |
S&P 500 6-year 10% Buffer with Upside Participation Rate Strategy |
||||||||||||
Year 1 |
||||||||||||||
Strategy Value - April 6, 2024 |
$ | 50,000 | $ | 50,000 | $ | 50,000 | See Footnote 1 below. | |||||||
Investment Base - April 6, 2024 |
$ | 50,000 | $ | 50,000 | $ | 50,000 | See Footnote 1 below. | |||||||
Daily Charges for Period |
$ | 375 | $ | 375 | $ | 375 | See Footnote 2 below. | |||||||
Remaining Investment Base - April 6, 2025 |
$ | 49,625 | $ | 49,625 | $ | 49,625 | See Footnote 3 below. | |||||||
Fall in Index for Period |
4.00 | % | 4.00 | % | n/a | See Footnote 4 below. | ||||||||
Buffer for Period |
n/a | n/a | n/a | See Footnote 5 below. | ||||||||||
Downside Participation Rate For Period |
50 | % | 50 | % | n/a | See Footnote 6 below. | ||||||||
Decrease as a Percentage |
2.00 | % | 2.00 | % | 4.50 | % | See Footnote 7 below. | |||||||
Dollar Amount of Decrease |
$ | 993 | $ | 993 | $ | 2,233 | See Footnote 8 below. | |||||||
Strategy Value - April 6, 2025 |
$ | 48,632 | $ | 48,632 | $ | 47,392 | See Footnote 9 below. | |||||||
Year 2 |
||||||||||||||
Investment Base - April 6, 2025 |
$ | 48,632 | $ | 48,632 | $ | 49,625 | See Footnote 9 below. | |||||||
Daily Charges for Period |
$ | 365 | $ | 365 | $ | 372 | See Footnote 10 below. | |||||||
Remaining Investment Base - April 6, 2026 |
$ | 48,267 | $ | 48,267 | $ | 49,253 | See Footnote 11 below. | |||||||
Fall in Index for Period |
4.00 | % | 4.00 | % | n/a | See Footnote 12 below. | ||||||||
Buffer for Period |
n/a | n/a | n/a | See Footnote 13 below. | ||||||||||
Downside Participation Rate For Period |
50 | % | 50 | % | n/a | See Footnote 14 below. | ||||||||
Decrease as a Percentage |
2.00 | % | 2.00 | % | 4.90 | % | See Footnote 15 below. | |||||||
Dollar Amount of Decrease |
$ | 965 | $ | 965 | $ | 2,413 | See Footnote 16 below. | |||||||
Strategy Value April 6, 2026 |
$ | 47,302 | $ | 47,302 | $ | 46,840 | See Footnote 17 below. | |||||||
Year 3 |
||||||||||||||
Investment Base April 6, 2026 |
$ | 47,302 | $ | 47,302 | $ | 49,253 | See Footnote 17 below. | |||||||
Daily Charges for Period |
$ | 355 | $ | 355 | $ | 369 | See Footnote 18 below. | |||||||
Remaining Investment Base April 6, 2027 |
$ | 46,947 | $ | 46,947 | $ | 48,884 | See Footnote 19 below. | |||||||
Fall in Index for Period |
4.00 | % | 4.00 | % | n/a | See Footnote 20 below. | ||||||||
Buffer for Period |
n/a | n/a | n/a | See Footnote 21 below. | ||||||||||
Downside Participation Rate For Period |
50 | % | 50 | % | n/a | See Footnote 22 below. | ||||||||
Decrease as a Percentage |
2.00 | % | -2.00 | % | 6.00 | % | See Footnote 23 below. | |||||||
Dollar Amount of Decrease |
$ | 939 | $ | 939 | $ | 2,933 | See Footnote 24 below. | |||||||
Strategy Value - April 6, 2027 |
$ | 46,008 | $ | 46,008 | $ | 45,951 | See Footnote 25 below. |
95
Year 4 |
||||||||||||||
Investment Base - April 6, 2027 |
$ | 46,008 | $ | 46,008 | $ | 48,884 | See Footnote 25 below. | |||||||
Daily Charges for Period |
$ | 345 | $ | 345 | $ | 367 | See Footnote 26 below. | |||||||
Remaining Investment Base - April 6, 2028 |
$ | 45,663 | $ | 45,663 | $ | 48,517 | See Footnote 27 below. | |||||||
Fall in Index for Period |
4.00 | % | 4.00 | % | n/a | See Footnote 28 below. | ||||||||
Buffer for Period |
n/a | n/a | n/a | See Footnote 29 below. | ||||||||||
Downside Participation Rate For Period |
50 | % | 50 | % | n/a | See Footnote 30 below. | ||||||||
Decrease as a Percentage |
2.00 | % | 2.00 | % | 8.10 | % | See Footnote 31 below. | |||||||
Dollar Amount of Decrease |
$ | 913 | $ | 913 | $ | 3,930 | See Footnote 32 below. | |||||||
Strategy Value - April 6, 2028 |
$ | 44,750 | $ | 44,750 | $ | 44,587 | See Footnote 33 below. | |||||||
Year 5 |
||||||||||||||
Investment Base - April 6, 2028 |
$ | 44,750 | $ | 44,750 | $ | 48,517 | See Footnote 33 below. | |||||||
Daily Charges for Period |
$ | 336 | $ | 336 | $ | 364 | See Footnote 34 below. | |||||||
Remaining Investment Base - April 6, 2029 |
$ | 44,414 | $ | 44,414 | $ | 48,153 | See Footnote 35 below. | |||||||
Fall in Index for Period |
4.00 | % | 4.00 | % | n/a | See Footnote 36 below. | ||||||||
Buffer for Period |
n/a | n/a | n/a | See Footnote 37 below. | ||||||||||
Downside Participation Rate For Period |
50 | % | 50 | % | n/a | See Footnote 38 below. | ||||||||
Decrease as a Percentage |
2.00 | % | 2.00 | % | -0.00 | % | See Footnote 39 below. | |||||||
Dollar Amount of Decrease |
$ | 888 | $ | 888 | 4,815 | See Footnote 40 below. | ||||||||
Strategy Value - April 6, 2029 |
$ | 43,526 | $ | 43,526 | $ | 43,338 | See Footnote 41 below. | |||||||
Year 6 |
||||||||||||||
Investment Base - April 6, 2029 |
$ | 43,526 | $ | 43,526 | $ | 48,153 | See Footnote 41 below. | |||||||
Daily Charges for Period |
$ | 326 | $ | 326 | $ | 361 | See Footnote 42 below. | |||||||
Remaining Investment Base - April 6, 2030 |
$ | 43,200 | $ | 43,200 | $ | 47,792 | See Footnote 43 below. | |||||||
Fall in Index for Period |
4.00 | % | 4.00 | % | 21.72 | % | See Footnote 44 below. | |||||||
Buffer for Period |
n/a | n/a | 10 | % | See Footnote 45 below. | |||||||||
Downside Participation Rate For Period |
50 | % | 50 | % | n/a | See Footnote 46 below. | ||||||||
Decrease as a Percentage |
2.00 | % | 2.00 | % | 11.72 | % | See Footnote 47 below. | |||||||
Dollar Amount of Decrease |
$ | 864 | $ | 864 | $ | 5,601 | See Footnote 48 below. | |||||||
Strategy Value - April 6, 2030 |
$ | 42,336 | $ | 42,336 | $ | 42,191 | See Footnote 49 below. |
Footnote 1. At the beginning of the first Term, the Strategy value is equal to the amount applied to the Strategy on the Term start date. The amount applied on the Term start date is also the beginning Investment Base.
Footnote 2. When no withdrawals are taken over the course of a 1-year Term, the Daily Charges through the Term are equal to the Investment Base at the Term start date times the annual rate at which the Daily Charge compounds. When no withdrawals are taken over the course of a year that is part of a 6-year Term, the Daily Charges for the year are equal to the Investment Base at the Term start date or the most recent Term start date anniversary times the annual rate at which the Daily Charge compounds.
Formula | Investment Base at Term start date or anniversary x annual rate | |
Calculation | $50,000 x 0.75% = $375 for all Indexed Strategies |
Footnote 3. The remaining Investment Base is equal to the beginning Investment Base minus the sum of the Daily Charges and minus the proportional reduction for any prior withdrawals and related Early Withdrawal Charges.
Formula | Beginning Investment Base sum of Daily Charges since beginning of year proportional reduction for any prior Withdrawals and related Early Withdrawal Charges = remaining Investment Base | |
Calculation | $50,000 - $375 - $0 = $49,625 for all Indexed Strategies |
Footnote 4. For a 1-year Strategy, the value at the end of the first Term is based on the rise or fall in the index over the Term. The rise or fall in Index for the Term is equal to the percentage change in the Index Value measured from the Term start date to the Term end date.
Formula | (Index Value on Term end date - Index Value on Term start date) / Index Value on Term start date | |
Calculation | (960.00 1000.00) / 1000.00 = -4.00% |
Thus, the Index has fallen 4.00%.
For the 6-year Strategy, the value at the end of Year 1 is based on the Daily Value Percentage, and not the rise or fall in the Index.
96
Footnote 5. The Buffer is the decrease in the value of an Index for a Term that is disregarded when determining the Loss for the Term. In this example, the S&P 500 6-year 10% Buffer with Upside Participation Rate Strategy did not complete a Term in Year 1, so no Buffer will be applied when determining the Strategy value at the end of Year 1. The 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy and the 1-year 50% Downside Participation Rate with Cap Strategy do not have a Buffer.
Footnote 6. The Downside Participation Rate is your share of any fall in the Index over a Term taken into account to determine the Strategy value at the end of the Term. In this example, both the 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy and the 1-year 50% Downside Participation Rate with Cap Strategy each have a Downside Participation Rate of 50%, which means the calculation of any decrease will include 50% of any Index fall. The 6-year 10% Buffer with Upside Participation Rate Strategy does not have a Downside Participation Rate.
Footnote 7.
The Index has fallen 4% in Year 1.
For a 1-year Strategy, when the Index has fallen over a Term, we use the following formula to calculate the decrease for both the 1-year 50% Downside Participation Rate with Cap Strategy and the 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy .
Formula | Fall in Index for Term x Downside Participation Rate for Term = Decrease as a Percentage | |
Calculation | 4.00% x 50% = 2.0% |
For the 6-year 10% Buffer with Upside Participation Rate Strategy, the Buffer only applies at the end of the 6-year Term. At the end of Year 1, the Strategy value is determined based on the Daily Value Percentage. The Daily Value Percentage may be more or less than the cumulative rise or fall of the Index since the Term start date, and it may be negative even when the Index has risen. The Strategy value may decline even when the fall in the Index has not exceeded the Buffer.
Footnote 8.
The Index has fallen 4% in Year 1
For a 1-year Strategy, when the Index has fallen over the Term, we use the following formula to calculate the amount of the decrease.
Formula | Remaining Investment Base x decrease percentage based on fall in Index = dollar amount of decrease based on fall in Index | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: | $49,625 x 2.0% = $993 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: | $49,625 x 2.0% = $993 |
Year 1 does not mark the end of a Term for the S&P 500 6-year 10% Buffer with Upside Participation Rate Strategy, so the value for that Strategy at the end of Year 1 is calculated using the same formula used on any other day before the end of a Term:
For the 6-year Strategy, when the Daily Value Percentage is negative, we use the following formula to calculate the amount of the decrease.
Formula | Remaining Investment Base x Daily Value Percentage = dollar amount of change based on Daily Value Percentage | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy : | $49,625 x -4.50% = -$2,233 |
Thus, the dollar amount of decrease is $2,233.
Footnote 9. In this example, for the 1-year Strategies, there has been a fall in the Index over the first Term. We use the following formula to calculate the Strategy value at the end of Year 1.
Formula | Remaining Investment Base on Term end datedollar amount of decrease based on fall in Index = Strategy value on Term end date | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$49,625 - $993 = $48,632 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$49,625 - $993 = $48,632 |
For the 6-year Strategy, the Daily Value Percentage is negative at the end of Year 1. We use the following formula to calculate the Strategy value.
Formula | Remaining Investment Base on valuation datedollar amount of decrease based on Daily Value Percentage = current Strategy value | |
Calculation |
97
6-year 10% Buffer with Upside Participation Rate Strategy: |
$49,625 - $2,333 = $47,392 |
For the 1-year Strategies, the Strategy value at the end of the first Term is also the Investment Base at the beginning of the second Term. For the 6-year Strategy, the existing Investment Base is carried forward because it is not the end of a Term.
Footnote 10. When no withdrawals are taken over the course of a 1-year Term, the Daily Charges through the Term are equal to the Investment Base on the Term start date times the annual rate at which the Daily Charge compounds. When no withdrawals are taken over the course of a year that is part of a 6-year Term, the Daily Charges for the year are equal to the Investment Base at the Term start date or the most recent Term start date anniversary times the annual rate at which the Daily Charge compounds.
Formula | Investment Base on Term start date or anniversary x annual rate | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$48,632 x 0.75% = $365 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$48,632 x 0.75% = $365 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$49,625 x 0.75% = $372 |
Footnote 11. The remaining Investment Base is equal to the beginning Investment Base minus the sum of the Daily Charges and minus the proportional reduction for any prior withdrawals and related Early Withdrawal Charges.
Formula | Beginning Investment Base sum of Daily Charges since beginning of year proportional reduction for any prior Withdrawals and related Early Withdrawal Charges = remaining Investment Base | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$48,632 - $365 - $0 = $48,267 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$48,632 - $365 - $0 = $48,267 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$49,625 - $372 - $0 = $49,253 |
Footnote 12. For a 1-year Strategy, the value at the end of the second Term is based on the rise or fall in the index over the Term. The rise or fall in Index for the Term is equal to the percentage change in the Index Value measured from the Term start date to the Term end date.
Formula | (Index Value on Term end date - Index Value on Term start date) / Index Value on Term start date | |
Calculation | (921.60 960.00) / 960.00 = 4.0% |
Thus, the Index has fallen 4.00%.
For the 6-year Strategy, the value at the end of Year 2 is based on the Daily Value Percentage, and not the rise or fall in the Index.
Footnote 13. The Buffer is the decrease in the value of an Index for a Term that is disregarded when determining the Loss for the Term. In this example, the S&P 500 6-year10% Buffer with Upside Participation Rate did not complete a Term in Year 2, so no Buffer will be applied to that Strategy in Year 2. The 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy and the 1-year 50% Downside Participation Rate with Cap Strategy do not have a Buffer.
Footnote 14. The Downside Participation Rate is your share of any fall in the Index over a Term taken into account to determine the Strategy value at the end of the Term. In this example, the 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy and the 1-year 50% Downside Participation Rate with Cap Strategy each have a Downside Participation Rate of 50%, which means the calculation of any decrease will include 50% of any Index fall. The 6-10% Buffer with Upside Participation Rate year Strategy does not have a Downside Participation Rate.
Footnote 15.
The Index has fallen 4% in Year 2.
When the Index has fallen over a Term, we use the following formula to calculate the decrease for both the 1-year 50% Downside Participation Rate with Cap Strategy and the 1-Year 50% Downside Participation Rate with an Upside Participation Rate Strategy.
Formula | Fall in Index for Term x Downside Participation Rate for Term = Decrease as a Percentage | |
Calculation | 4.00% x 50% = 2.00% |
98
For the 6-year 10% Buffer with Upside Participation Rate Strategy, the Buffer only applies at the end of the 6-year Term. At the end of Year 2, the Strategy value is determined based on the Daily Value Percentage. The Daily Value Percentage may be more or less than the cumulative rise or fall of the Index since the Term start date, and it may be negative even when the Index has risen. The Strategy value may decline even when the fall in the Index has not exceeded the Buffer.
Footnote 16.
The Index has fallen 4% in Year 2
For a 1-year Strategy, when the Index has fallen over the Term, we use the following formula to calculate the amount of the decrease.
Formula | Remaining Investment Base x decrease percentage based on fall in Index = dollar amount of decrease based on fall in Index | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$48,267 x 2.00% = $965 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$48,267 x 2.0% = $965 |
Year 2 does not mark the end of a Term for the S&P 500 6-year 10% Buffer with Upside Participation Rate Strategy, so the value for that Strategy at the end of Year 2 is calculated using the same formula used on any other day before the end of a Term:
Formula | Remaining Investment Base x Daily Value Percentage = dollar amount of decrease based on Daily Value Percentage | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$49,253 x -4.90% = -$2,413 |
Thus, the dollar amount of decrease is $2,413.
Footnote 17. In this example, for the 1-year Strategies, there has been a fall in the Index over the second Term. We use the following formula to calculate the Strategy value at the end of Year 2.
Formula | Remaining Investment Base on Term end datedollar amount of decrease based on fall in Index = Strategy value on Term end date | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$48,267 - $965 = $47,302 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$48,267 - $965 = $47,302 |
For the 6-year Strategy, the Daily Value Percentage is negative at the end of Year 2. We use the following formula to calculate the Strategy value.
Formula | Remaining Investment Base on valuation datedollar amount of decrease based on Daily Value Percentage = current Strategy value | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$49,253 - $2,413 = $46,840 |
For the 1-year Strategies, the Strategy value at the end of the second Term is also the Investment Base at the beginning of the third Term. For the 6-year Strategy, the existing Investment Base is carried forward because it is not the end of a Term.
Footnote 18. When no withdrawals are taken over the course of a 1-year Term, the Daily Charges through the Term are equal to the Investment Base on the Term start date times the annual rate at which the Daily Charge compounds. When no withdrawals are taken over the course of a year that is part of a 6-year Term, the Daily Charges for the year are equal to the Investment Base at the Term start date or the most recent Term start date anniversary times the annual rate at which the Daily Charge compounds.
Formula | Investment Base on Term start date or anniversary x annual rate |
99
Calculation |
1-year Strategy with a Cap: |
$47,302 x 0.75% = $355 | |
1-year Strategy with an Upside Participation Rate: |
$47,302 x 0.75% = $355 | |
6-year Strategy with a Buffer: |
$49,253 x 0.75% = $369 |
Footnote 19. The remaining Investment Base is equal to the beginning Investment Base minus the sum of the Daily Charges and minus the proportional reduction for any prior withdrawals and related Early Withdrawal Charges.
Formula | Beginning Investment Base sum of Daily Charges since beginning of year proportional reduction for any prior Withdrawals and related Early Withdrawal Charges = remaining Investment Base | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$47,302 - $355 - $0 = $46,947 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy : |
$47,302 - $355 - $0 = $46,947 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$49,253 - $369 - $0 = $48,884 |
Footnote 20. For a 1-year Strategy, the value at the end of the third Term is based on the rise or fall in the index over the Term. The rise or fall in Index for the Term is equal to the percentage change in the Index Value measured from the Term start date to the Term end date.
Formula | (Index Value on Term end dateIndex Value on Term start date) / Index Value on Term start date | |
Calculation | (884.74- 921.60) / 921.60 = -4.0% |
Thus, the Index has fallen 4.00%.
For the 6-year Strategy, the value at the end of Year 3 is based on the Daily Value Percentage, and not the rise or fall in the Index.
Footnote 21. The Buffer is the decrease in the value of an Index for a Term that is disregarded when determining the Loss for the Term. In this example, the S&P 500 6-year10% Buffer with Upside Participation Rate Strategy did not complete a Term in Year 3, so no Buffer will be applied to that Strategy in Year 3. The 1-year Upside Participation Rate Strategy and the 1-year Strategy with a Cap do not have a Buffer.
Footnote 22. The Downside Participation Rate is your share of any fall in the Index over a Term taken into account to determine the Strategy value at the end of the Term. In this example, the 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy and the 1-year 50% Downside Participation Rate with Cap Strategy each have a Downside Participation Rate of 50%, which means the calculation of any decrease will include 50% of any Index fall. The 6-year 10% Buffer with Upside Participation Rate Strategy does not have a Downside Participation Rate.
Footnote 23.
The Index has fallen 4% in Year 3.
For a 1-year Strategy, when the Index has fallen over a Term, we use the following formula to calculate the decrease for both the 1-year Strategy with a Cap and the 1-Year Strategy with an Upside Participation Rate.
Formula | Fall in Index for Term x Downside Participation Rate for Term = Decrease as a Percentage | |
Calculation | 4.00% x 50% = 2.00% |
For the 6-year 10% Buffer with Upside Participation Rate Strategy, the Buffer only applies at the end of the 6-year Term. At the end of Year 3, the Strategy value is determined based on the Daily Value Percentage. The Daily Value Percentage may be more or less than the cumulative rise or fall of the Index since the Term start date, and it may be negative even when the Index has risen. The Strategy value may decline even when the fall in the Index has not exceeded the Buffer.
Footnote 24.
The Index has fallen 4% in Year 3.
For a 1-year Strategy, when the Index has fallen over the Term, we use the following formula to calculate the amount of the decresae.
Formula | Remaining Investment Base x decrease percentage based on rise in Index = dollar amount of decrease based on fall in Index | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$46,947 x 2.00% = $939 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$46,947 x 2.00% = $939 |
100
Year 3 does not mark the end of a Term for the S&P 500 6-year 10% Buffer with Upside Participation Rate Strategy, so the value for that Strategy at the end of Year 3 is calculated using the same formula used on any other day before the end of a Term:
Formula | Remaining Investment Base x Daily Value Percentage = dollar amount of change based on Daily Value Percentage | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,884 x 6.00% = $2,933 |
Thus, the dollar amount of decrease is $2,933.
Footnote 25. In this example, for the 1-year Strategies, there has been a fall in the Index over the third Term. This means the Strategy value at the end of Year 3 is the Remaining Investment Base on the Term end date minus the decrease for the fall in the Index over the Term.
Formula | Remaining Investment Base on Term end datedollar amount of decrease based on rise in Index = Strategy value on Term end date | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$46,947 - $939 = $46,008 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$46,947 - $939 = $46,008 |
For the 6-year Strategy, the Daily Value Percentage is negative at the end of Year 3. We use the following formula to calculate the Strategy value.
Formula | Remaining Investment Base on valuation date - dollar amount of decrease based on Daily Value Percentage = current Strategy value | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,884 - $2,933 = $45,951 |
For the 1-year Strategies, the Strategy value at the end of the third Term is also the Investment Base at the beginning of the fourth Term. For the 6-year Strategy, the existing Investment Base is carried forward because it is not the end of a Term.
Footnote 26. When no withdrawals are taken over the course of a 1-year Term, the Daily Charges through the Term are equal to the Investment Base on the Term start date times the annual rate at which the Daily Charge compounds. When no withdrawals are taken over the course of a year that is part of a 6-year Term, the Daily Charges for the year are equal to the Investment Base at the Term start date or the most recent Term start date anniversary times the annual rate at which the Daily Charge compounds.
Formula | Investment Base on Term start date or anniversary x annual rate | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$46,008 x 0.75% = $345 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$46,008 x 0.75% = $345 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,884 x 0.75% = $367 |
Footnote 27. The remaining Investment Base is equal to the beginning Investment Base minus the sum of the Daily Charges and minus the proportional reduction for any prior withdrawals and related Early Withdrawal Charges.
Formula | Beginning Investment Base sum of Daily Charges since beginning of year proportional reduction for any prior Withdrawals and related Early Withdrawal Charges = remaining Investment Base | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$46,008 - $345 - $0 = $45,663 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$46,008 - $345 - $0 = $45,663 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,884 - $367 - $0 = $48,517 |
101
Footnote 28. For a 1-year Strategy, the value at the end of the fourth Term is based on the rise or fall in the index over the Term. The rise or fall in Index for the Term is equal to the percentage change in the Index Value measured from the Term start date to the Term end date.
Formula | (Index Value on Term end date- Index Value on Term start date) / Index Value on Term start date | |
Calculation | (849.35 884.74) / 884.74 = -4.00% |
Thus, the Index has fallen 4.00%.
For the 6-year Strategy, the value at the end of Year 4 is based on the Daily Value Percentage, and not the rise or fall in the Index.
Footnote 29. The Buffer is the decrease in the value of an Index for a Term that is disregarded when determining the Loss for the Term. In this example, the S&P 500 6-year 10% Buffer with Upside Participation Rate Strategy did not complete a Term in Year 4, so no Buffer will be applied to that Strategy in Year 4. The 1-year 50% Downside Participation Rate with Upside Participation Rate
Strategy and the 1-year 50% Downside Participation Rate with Cap Strategy with a Cap do not have a Buffer.
Footnote 30. The Downside Participation Rate is your share of any fall in the Index over a Term taken into account to determine the Strategy value at the end of the Term. In this example, the 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy and the 1-year 50% Downside Participation Rate with Cap Strategy each have a Downside Participation Rate of 50%, which means the calculation of any decrease will include 50% of any Index fall. The 6-year 10% Buffer with Upside Participation Rate Strategy does not have a Downside Participation Rate.
Footnote 31.
The Index has fallen 4% in Year 4
For a 1-year Strategy, when the Index has fallen over a Term, we use the following formula to calculate the decrease for both the 1-year 50% Downside Participation Rate with Cap Strategy and the 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy .
Formula | Fall in Index for Term x Downside Participation Rate for Term = Decrease as a Percentage | |
Calculation | 4.0% x 50% = 2.0% |
For the 6-year 10% Buffer with Upside Participation Rate Strategy, the Buffer only applies at the end of the 6-year Term. At the end of Year 4, the Strategy value is determined based on the Daily Value Percentage. The Daily Value Percentage may be more or less than the cumulative rise or fall of the Index since the Term start date, and it may be negative even when the Index has risen. The Strategy value may decline even when the fall in the Index has not exceeded the Buffer.
Footnote 32.
The Index has fallen 4% in Year 4
For a 1-year Strategy, when the Index has fallen over the Term, we use the following formula to calculate the amount of the decrease.
Formula | Remaining Investment Base x decrease percentage based on fall in Index = dollar amount of decrease based on fall in Index | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$45,663 x 2.00% = $913 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$45,663 x 2.00% = $913 |
Year 4 does not mark the end of a Term for the S&P 500 6-year 10% Buffer with Upside Participation Rate Strategy, so the value for that Strategy at the end of Year 4 is calculated using the same formula used on any other day before the end of a Term:
Formula | Remaining Investment Base x Daily Value Percentage = dollar amount of change based on Daily Value Percentage | |
Calculation |
6-year 10% Buffer with Upside Participation
Rate |
$48,517 x -8.10% = -$3,930 |
Thus, the dollar amount of decrease is $3,930.
Footnote 33. In this example, for the 1-year Strategies, there has been a fall in the Index over the fourth Term. This means the Strategy value at the end of Year 4 is the Remaining Investment Base on the Term end date minus the decrease for the fall in the Index over the Term.
102
Formula | Remaining Investment Base on Term end date - dollar amount of decrease based on fall in Index = Strategy value on Term end date | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$45,663 - $913 = $44,750 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$45,663 - $913 = $44,750 |
For the 6-year 10% Buffer with Upside Participation Rate Strategy, the Daily Value Percentage is negative at the end of Year 4. We use the following formula to calculate the Strategy value.
Formula | Remaining Investment Base on valuation datedollar amount of decrease based on Daily Value Percentage = current Strategy value | |
Calculation |
6-year 10% Buffer with Upside Participation
Rate |
$48,517 - $3,930 = $44,587 |
For the 1-year Strategies, the Strategy value at the end of the fourth Term is also the Investment Base at the beginning of the fifth Term. For the 6-year Strategy, the existing Investment Base is carried forward because it is not the end of a Term.
Footnote 34. When no withdrawals are taken over the course of a 1-year Term, the Daily Charges through the Term are equal to the Investment Base on the Term start date times the annual rate at which the Daily Charge compounds. When no withdrawals are taken over the course of a year that is part of a 6-year Term, the Daily Charges for the year are equal to the Investment Base at the Term start date or the most recent Term start date anniversary times the annual rate at which the Daily Charge compounds.
Formula | Investment Base on Term start date or anniversary x annual rate | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$44,750 x 0.75% = $336 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$44,750 x 0.75% = $336 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,517 x 0.75% = $364 |
Footnote 35. The remaining Investment Base is equal to the beginning Investment Base minus the sum of the Daily Charges and minus the proportional reduction for any prior withdrawals and related Early Withdrawal Charges.
Formula | Beginning Investment Base sum of Daily Charges since beginning of year proportional reduction for any prior Withdrawals and related Early Withdrawal Charges = remaining Investment Base | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$44,750 - $336 - $0 = $44,414 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$44,750 - $336 - $0 = $44,414 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,517 - $364 - $0 = $48,153 |
Footnote 36. For a 1-year Strategy, the value at the end of the fifth Term is based on the rise or fall in the index over the Term. The rise or fall in Index for the Term is equal to the percentage change in the Index Value measured from the Term start date to the Term end date.
Formula | (Index Value on Term end dateIndex Value on Term start date) / Index Value on Term start date | |
Calculation | (815.37 849.35) / 849.35 = -4.00% |
Thus, the Index has fallen 4.00%.
For the 6-year 10% Buffer with Upside Participation Rate Strategy, the value at the end of Year 5 is based on the Daily Value Percentage, and not the rise or fall in the Index.
103
Footnote 37. The Buffer is the decrease in the value of an Index for a Term that is disregarded when determining the Loss for the Term. In this example, the S&P 500 6-year 10% Buffer with Upside Participation Rate Term 10% Buffer did not complete a Term in Year 5, so no Buffer will be applied to that Strategy in Year 5. The 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy and the 1-year 50% Downside Participation Rate with Cap Strategy with a Cap do not have a Buffer.
Footnote 38. The Downside Participation Rate is your share of any fall in the Index over a Term taken into account to determine the Strategy value at the end of the Term. In this example, the 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy and the 1-year 50% Downside Participation Rate with Cap Strategy each have a Downside Participation Rate of 50%, which means the calculation of any decrease will include 50% of any Index fall. The 6-year 10% Buffer with Upside Participation Rate Strategy does not have a Downside Participation Rate.
Footnote 39.
The Index has fallen 4% in Year 5
For a 1-year Strategy, when the Index has fallen over a Term, we use the following formula to calculate the decrease for both the 1-year Strategy with a Cap and the 1-Year Strategy with an Upside Participation Rate.
Formula | Fall in Index for Term x Downside Participation Rate for Term = Decrease as a Percentage | |
Calculation | 4.00% x 50% = 2.00% |
For the 6-year 10% Buffer with Upside Participation Rate Strategy with a Buffer, the Buffer only applies at the end of the 6-year Term. At the end of Year 5, the Strategy value is determined based on the Daily Value Percentage. The Daily Value Percentage may be more or less than the cumulative rise or fall of the Index since the Term start date, and it may be negative even when the Index has risen. The Strategy value may decline even when the fall in the Index has not exceeded the Buffer.
Footnote 40.
The Index has fallen 4% in Year 5
For a 1-year Strategy, when the Index has fallen over the Term, we use the following formula to calculate the amount of the decrease.
Formula | Remaining Investment Base x decrease percentage based on fall in Index = dollar amount of decrease based on rise in Index | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$44,414 x 2.00% = $888 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$44,414 x 2.00% = $888 |
Year 5 does not mark the end of a Term for the S&P 500 6-year 10% Buffer with Upside Participation Rate Strategy, so the value for that Strategy at the end of Year 5 is calculated using the same formula used on any other day before the end of a Term:
Formula | Remaining Investment Base x Daily Value Percentage = dollar amount of change based on Daily Value Percentage | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,153 x -10.00% = -$4,815 |
Thus, the dollar amount of decrease is $4,815.
Footnote 41. In this example, for the 1-year Strategies, there has been a fall in the Index over the fifth Term. This means the Strategy value at the end of Year 5 is the Remaining Investment Base on the Term end date minus the decrease for the fall in the Index over the Term.
Formula | Remaining Investment Base on Term end date + dollar amount of decrease based on fall in Index = Strategy value on Term end date | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$44,414 - $888 = $43,526 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$44,414 - $888 = $43,526 |
For the 6-year 10% Buffer with Upside Participation Rate Strategy, the Daily Value Percentage is negative at the end of Year 5. We use the following formula to calculate the Strategy value.
Formula | Remaining Investment Base on valuation datedollar amount of decrease based on Daily Value Percentage = current Strategy value | |
Calculation |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,153 - $4,815 = $43,338 |
104
For the 1-year Strategies, the Strategy value at the end of the fifth Term is also the Investment Base at the beginning of the sixth Term. For the 6-year Strategy, the existing Investment Base is carried forward because it is not the end of a Term.
Footnote 42. When no withdrawals are taken over the course of a 1-year Term, the Daily Charges through the Term are equal to the Investment Base on the Term start date times the annual rate at which the Daily Charge compounds. When no withdrawals are taken over the course of a year that is part of a 6-year Term, the Daily Charges for the year are equal to the Investment Base at the Term start date or the most recent Term start date anniversary times the annual rate at which the Daily Charge compounds.
Formula | Investment Base on Term start date or anniversary x annual rate | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$43,526 x 0.75% = $326 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$43,526 x 0.75% = $326 | |
6-year 10% Buffer with Upside Participation
Rate |
$48,153 x 0.75% = $361 |
Footnote 43. The remaining Investment Base is equal to the beginning Investment Base minus the sum of the Daily Charges and minus the proportional reduction for any prior withdrawals and related Early Withdrawal Charges.
Formula | Beginning Investment Base sum of Daily Charges since beginning of year proportional reduction for any prior Withdrawals and related Early Withdrawal Charges = remaining Investment Base | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$43,526 - $326 - $0 = $43,200 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$43,526 - $326 - $0 = $43,200 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$48,153 - $361 - $0 = $47,792 |
Footnote 44. For a 1-year Strategy, the value at the end of the sixth Term is based on the rise or fall in the index over the Term. The rise or fall in Index for the Term is equal to the percentage change in the Index Value measured from the Term start date to the Term end date.
Formula | (Index Value on Term end date - Index Value on Term start date) / Index Value on Term start date | |
Calculation | (782.76 815.37) / 815.37 = -4.00% |
Thus, the Index has fallen 4% .
For the 6-year 10% Buffer with Upside Participation Rate Strategy, the value at the end of the Term is based on the rise or fall in the index over the entire 6-year Term. The rise or fall in Index for the Term is equal to the percentage change in the Index Value measured from the Term start date to the Term end date.
Formula | (Index Value on Term end dateIndex Value on Term start date) / Index Value on Term start date | |
Calculation | (782.76 1000.00) / 1000.00 = -21.7% |
Thus, the Index has fallen 21.72%.
Footnote 45. The Buffer is the decrease in the value of an Index for a Term that is disregarded when determining the Loss for the Term. The S&P 500 6-year 10% Buffer with Upside Participation Rate Strategy has a Buffer of -10% that is applied to calculate the Strategy value at the end of the 6-year Term. The 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy and the 1-year 50% Downside Participation Rate with Cap Strategy do not have a Buffer.
Footnote 46. The Downside Participation Rate is your share of any fall in the Index over a Term taken into account to determine the Strategy value at the end of the Term. In this example, the 1-year 50% Downside Participation Rate with Upside Participation Rate Strategy and the 1-year 50% Downside Participation Rate with Cap Strategy each have a Downside Participation Rate of 50%, which means the calculation of any decrease will include 50% of any Index fall. The 6-year 10% Buffer with Upside Participation Rate Strategy does not have a Downside Participation Rate.
105
Footnote 47.
The Index has fallen 4% in Year 6 and has fallen 21.72% from the start of Year 1 to the end of Year 6.
For a 1-year Strategy, when the Index has fallen over a Term, we use the following formula to calculate the decrease for both the 1-year 50% Downside Participation Rate with Cap Strategy and the 1-Year 50% Downside Participation Rate with Upside Participation Rate Strategy .
Formula | Fall in Index for Term x Downside Participation Rate for Term = Decrease as a Percentage | |
Calculation | 4.00% x 50% = 2.00% |
For the 6-year Strategy, when the Index has fallen over a Term, we use the following formulas to calculate the decrease.
Formula | If the fall in Index is greater than Buffer, then Fall in Index Buffer = Decrease as a Percentage | |
If the fall in Index is not greater than Buffer, then Decrease as a Percentage = 0 | ||
Calculation | 21.72% fall in Index is greater than the 10% Buffer, so Decrease as a Percentage = 21.72% - 10% = 11.72% |
Footnote 48.
For both a 1-year Strategy and the 6-year Strategy, when the Index has fallen over the Term, we use the following formula to calculate the decrease.
Formula | Remaining Investment Base x decrease percentage based on fall in Index = dollar amount of decrease based on fall in Index | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$43,200 x 2.0% = $864 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$43,200 x 2.0% = $864 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$47,792 x 11.7% = $5,601 |
Footnote 49. In this example, for the 1-year Strategies, there has been a fall in the Index over the sixth Term. For the 6-year Strategy, there has also been a fall in the Index over its 6-year Term. This means that for both a 1-year Strategy and the 6-year Strategy, the Strategy value at the end of Year 6 is the Remaining Investment Base on the Term Year end date minus the decrease for the fall in the Index over the Term.
Formula | Remaining Investment Base on Term end datedollar amount of decrease based on fall in Index = Strategy value on Term end date | |
Calculation |
1-year 50% Downside Participation Rate with Cap Strategy: |
$43,200 - $864 = $42,336 | |
1-year 50% Downside Participation Rate with Upside Participation Rate Strategy: |
$43,200 - $864 = $42,336 | |
6-year 10% Buffer with Upside Participation Rate Strategy: |
$47,792 - $5,601 = $42,191 |
This prospectus describes the material features of the Contract. Contracts issued in your state may provide different features and benefits from, and impose different costs than, those described in this prospectus because of state law variations. However, please note that the maximum charge is set forth in this prospectus. If you would like to review a copy of the Contract and any endorsements, contact us at P.O. Box 5423, Cincinnati, OH 45201-5423, visit our website at www.mmascend.com or call us at 1-800-789-6771.
The following information is a summary of material state variations as of the date of this prospectus.
General
For Contracts Issued in Illinois
References to spouse have been changed to spouse or civil union partner.
For Contracts Issued in Missouri
No Performance Lock election is permitted.
106
When taken from Indexed Strategies, withdrawals are taken proportionately without regard to Term length. Certain Indexed Strategies are not available.
For Contracts Issued in New Jersey
References to spouse have been changed to spouse or civil union partner.
Extended Care Waiver Rider
For Contracts Issued in California
The Waiver of Early Withdrawal Charges for Facility Care or Home Care or Community-Based Services Rider (CA Rider) provides a waiver under an expanded set of circumstances. The waiver will apply if, at the time of the withdrawal or surrender, or within the immediately preceding 90 days, the following conditions are met: (1) the insured is confined in a facility or is receiving, as prescribed by a physician, registered nurse or licensed social worker, home care or community-based services; (2) the insureds confinement in a facility, the insureds receipt of home care or community-based services, or any combination thereof has continued for a period of at least 90 consecutive days; and (3) the first day of such 90-day period was at least one year after the contract effective date. Facility includes a skilled nursing facility, a convalescent nursing home, or an extended care facility or a residential care facility or a residential care facility for the elderly. Home care or community-based services includes home health care, adult day care, personal care, homemaker services, hospice services and respite care as defined in the rider. Additional conforming changes have been made including revised and new definitions, and inclusion of a description of circumstances under which the waiver does not apply. The termination provision has been modified to reflect that the rider will not terminate if you transfer or assign an interest in the contract to a person or entity other than the insured.
For Contracts Issued in Connecticut
The conditions under which the waiver applies have been modified. The waiver will apply if at the time of a withdrawal or surrender or within the immediately preceding 90 days all of the following conditions are met: (1) an insured is confined in a long-term care facility or hospital; and (2) the confinement has continued for a period of at least 90 consecutive days.
For Contracts Issued in Kansas
The conditions under which the waiver applies have been modified. The first day of confinement must be at least 90 days after the contract effective date, rather than one year after the contract effective date.
For Contracts Issued in Massachusetts
This waiver rider is not available in Massachusetts.
For Contracts Issued in Missouri
This waiver rider is not available in Missouri.
For Contracts Issued In Montana
The definition of medically necessary has been modified and refers to the Insureds physician.
For Contracts Issued in Nebraska
The definition of skilled nursing facility has been modified by adding a licensed practical nurse to the list of persons who may provide nursing services or supervise the provision of nursing services.
For Contracts Issued in New Hampshire
The definition of skilled nursing facility has been modified by changing the phrase licensed and operated as a skilled nursing facility to operated as a skilled nursing facility.
For Contracts Issued in Pennsylvania
The conditions under which the waiver is available have been modified. The waiver will apply if at the time of a withdrawal or surrender or within the immediately preceding 90 days all of the following conditions are met: (1) an insured is confined in one or more long-term care facilities, hospital, or a combination of such; (2) the confinement is prescribed by a physician and is medically necessary; (3) the first day of the confinement is at least one year after the contract effective date; and (4) the confinement has continued for a period of at least 90 consecutive days, or has continued for a total of at least 90 days if each successive confinement occurs within six months of the previous confinement and is for the same related medical cause.
107
The definition of long-term care facility has been modified. The following facilities have been deleted from the list of facilities excluded from that definition: a facility that primarily treats drug addicts and a facility that is a home for the mentally ill. An exclusion provision has been added to clarify that the waiver will not apply if the insured is confined in a long-term care facility or hospital for the treatment of certain types of drug addiction or mental illnesses.
The definition of hospital has been modified by changing the phrase it maintains, or has access to, medical, diagnostic, and major surgical facilities to it maintains, or has access to, medical and diagnostic facilities.
For Contracts Issued in Vermont
The definition of long-term care facility has been modified. The following facilities have been deleted from the list of excluded facilities: a facility that primarily treats drug addicts, a facility that primarily treats alcoholics, and a facility that is a home for the mentally ill. In addition, the definition of physician has been modified by changing the phrase a person who is licensed in the United States as a medical doctor or a doctor of osteopathy and who is practicing within the scope of his or her license to a person who is licensed in the United States who is providing medical care and treatment when such services are provided within the scope of his or her license and provided pursuant to applicable law.
For Contracts Issued in Washington
The waiver is based on confinement to an extended care facility or hospital rather than a long-term care facility or hospital. Definitions are modified to reflect the new terminology, references to skilled nursing facility are changed to nursing facility and the related definition is modified. In the definition of nursing facility and hospital, a licensed practical nurse is added to the list of persons who may provide nursing services or supervise the provision of nursing services.
Terminal Illness Waiver Rider
For Contracts Issued in Illinois
As a result of the terminal illness, your life expectancy must be 24 months from the date of death, rather than 12 months.
For Contracts Issued in Kansas
As a result of the terminal illness, your life expectancy must be 24 months from the date of death, rather than 12 months. The diagnosis must be rendered 90 days after the contract effective date, rather than one year after the contract effective date.
For Contracts Issued in New Jersey
The requirement related to the timing of the diagnosis does not apply. But the waiver will not be available until at least one year after the contract effective date.
For Contracts Issued in Massachusetts
This waiver rider is not available in Massachusetts.
For Contracts Issued in Pennsylvania
The diagnosis must be rendered after the contract effective date, rather than one year after the contract effective date. But the waiver will not be available until at least one year after the contract effective date. In addition, the waiver is based on a terminal condition as defined in the rider, rather than a terminal illness.
For Contracts Issued in Texas
The diagnosis must be rendered on or after the contract effective date, rather than one year after the contract effective date.
For Contracts Issued in Washington
As a result of the terminal illness, your life expectancy must be 24 months from the date of death, rather than 12 months.
Form of Annuity Payout Benefit
For Contracts Issued in Texas:
Payments under a Payout Option are subject to a $50 minimum.
108
Right to Cancel (Free Look)
State law governs the length of the free look period and the amount of the refund that you will receive. The period and amount may differ if you are replacing a life insurance policy or annuity contract. The table below summarizes the state law provisions.
For Contracts |
Free |
Refund |
Replacement |
Replacement Refund | ||||
Alabama | 20 days | Account Value | 30 days | Account Value + Fees/Charges | ||||
Alaska | 20 days | Account Value + Fees/Charges | 30 days | Account Value + Fees/Charges | ||||
Arizona | 20 days | Account Value + Fees/Charges | 30 days | Account Value + Fees/Charges | ||||
Arkansas | 20 days | Account Value | 30 days | Account Value | ||||
California | 30 days | Account Value + Fees/Charges Note: If owner is age 60 or older, refund amount is Purchase Payments. |
30 days | Account Value + Fees/Charges Note: If owner is age 60 or older, refund amount is Purchase Payments. | ||||
Colorado | 20 days | Account Value | 30 days | Account Value + Fees/Charges | ||||
Connecticut | 20 days | Account Value + Fees/Charges | 30 days | Account Value + Fees/Charges | ||||
Delaware | 20 days | Account Value | 30 days | Purchase Payments | ||||
District of Columbia | 20 days | Account Value | 30 days | Account Value | ||||
Florida | 21 days | Account Value + Fees/Charges | 30 days | Account Value + Fees/Charges | ||||
Georgia | 20 days | Purchase Payments | 30 days | Purchase Payments | ||||
Hawaii | 20 days | Account Value | 30 days | Account Value + Fees/Charges | ||||
Idaho | 20 days | Purchase Payments | 30 days | Purchase Payments | ||||
Illinois | 20 days | Account Value + Fees/Charges | 30 days | Account Value + Fees/Charges | ||||
Indiana | 20 days | Account Value | 30 days | Purchase Payments | ||||
Iowa | 20 days | Account Value | 30 days | Account Value + Fees/Charges | ||||
Kansas | 20 days | Account Value + Fees/Charges | 30 days | Account Value + Fees/Charges | ||||
Kentucky | 20 days | Purchase Payments | 30 days | Account Value + Fees/Charges | ||||
Louisiana | 20 days | Purchase Payments | 30 days | Account Value + Fees/Charges | ||||
Maine | 20 days | Account Value | 30 days | Account Value + Fees/Charges | ||||
Maryland | 20 days | Purchase Payments | 30 days | Account Value + Fees/Charges | ||||
Massachusetts | 20 days | Account Value | 30 days | Purchase Payments | ||||
Michigan | 20 days | Account Value + Fees/Charges | 30 days | Account Value + Fees/Charges | ||||
Minnesota | 20 days | Account Value + Fees/Charges | 30 days | Purchase Payments | ||||
Mississippi | 20 days | Account Value | 30 days | Account Value + Fees/Charges | ||||
Missouri | 20 days | Purchase Payments | 30 days | Purchase Payments | ||||
Montana | 20 days | Account Value | 30 days | Account Value + Fees/Charges | ||||
Nebraska | 20 days | Purchase Payments | 30 days | Account Value + Fees/Charges | ||||
Nevada | 20 days | Purchase Payments | 30 days | Purchase Payments | ||||
New Hampshire | 20 days | Purchase Payments | 30 days | Account Value + Fees/Charges | ||||
New Jersey | 20 days | Account Value + Fees/Charges | 30 days | Account Value + Fees/Charges | ||||
New Mexico | 20 days | Account Value | 30 days | Account Value + Fees/Charges | ||||
North Carolina | 20 days | Purchase Payments | 30 days | Account Value + Fees/Charges | ||||
North Dakota | 20 days | Account Value + Fees/Charges | 30 days | Account Value + Fees/Charges | ||||
Ohio | 20 days | Account Value | 30 days | Account Value + Fees/Charges | ||||
Oklahoma | 20 days | Purchase Payments | 30 days | Purchase Payments | ||||
Oregon | 20 days | Account Value | 30 days | Account Value + Fees/Charges | ||||
Pennsylvania | 20 days | Account Value | 30 days | Account Value | ||||
Rhode Island | 20 days | Purchase Payments | 30 days | Account Value + Fees/Charges | ||||
South Carolina | 20 days | Purchase Payments | 30 days | Account Value + Fees/Charges | ||||
South Dakota | 20 days | Account Value + Fees/Charges | 30 days | Account Value + Fees/Charges | ||||
Tennessee | 20 days | Account Value | 30 days | Purchase Payments | ||||
Texas | 20 days | Purchase Payments | 30 days | Account Value + Fees/Charges | ||||
Utah | 20 days | Purchase Payments | 30 days | Purchase Payments | ||||
Vermont | 20 days | Account Value | 30 days | Account Value + Fees/Charges | ||||
Virginia | 20 days | Account Value | 30 days | Account Value + Fees/Charges | ||||
Washington | 20 days | Greater of: (1) Purchase Payments or (2) Account Value minus taxes | 30 days | Purchase Payments | ||||
West Virginia | 20 days | Account Value | 30 days | Account Value + Fees/Charges | ||||
Wisconsin | 30 days | Account Value | 30 days | Account Value + Fees/Charges | ||||
Wyoming | 20 days | Account Value | 30 days | Greater of: (1) Purchase Payments or (2) Account Value + Fees/Charges |
109
Assignment
For Contracts Issued in Ohio:
Subject to the tax qualifications endorsement, if any, you may assign your rights to designate or change a Beneficiary or an Annuitant, to change Owners, or to elect a Payout Option if you make a specific Request in Good Order.
Amendment of the Contract
For Contracts Issued in Florida:
You have the right to reject an endorsement that changes the provisions of this Contract to obtain or retain the intended tax treatment under federal tax law, or to take into account other pertinent laws and governmental regulations and rulings. We will not be responsible for the tax or other consequences of your rejection.
For Contracts Issued in Texas:
You have the right to reject an endorsement that changes the provisions of this Contract to obtain or retain the intended tax treatment under federal tax law, or to take into account other pertinent laws and governmental regulations and rulings. We will not be responsible for the tax or other consequences of your rejection.
Involuntary Termination
For Contracts Issued in Texas:
Our right to terminate this Contract is not tied to the minimum required value. We have the right to terminate this Contract if the Account Value would provide a benefit of less than $20 each month at age 70 under a life payout with payments for at least a fixed period of 10 years.
Our form number for the Contract is P1833621NW. Our form numbers for the Indexed Strategy endorsements to the Contract are E1825418NW, E1825518NW, E1825618NW, E1825718NW, E1825818, E1825918NW, E1826018NW, E1826118NW, E1849922NW, E1850022NW, E1850122NW, E1850522NW, E1850622NW, E1850722NW, E1849122NW, and E1849222NW. Our form number for the Death Benefit endorsement to this Contract is E1826318NW. The form numbers may vary by state. The Securities and Exchange Commission file number for the Contract is 333-[ ].
SECTION II
MASSMUTUAL ASCEND LIFE INFORMATION
[to be added by amendment]
110
PART II INFORMATION NOT REQUIRED IN PROSPECTUS
Item 13. Other Expenses of Issuance and Distribution
The following is a list of the estimated expenses to be incurred in connection with the securities being offered.
Estimated Accounting Fees |
$ | [2,232,020 | ] | |
Estimated Filing Fees |
$ | 0 | ||
Estimated Legal Fees |
$ | [200,000 | ] | |
Registration Fees |
$ | 0 |
Item 14. Indemnification of Directors and Officers
Ohio Revised Code, Section 1701.13(E), allows indemnification by the Registrant to any person made or threatened to be made a party to any proceedings, other than a proceeding by or in the right of the Registrant, by reason of the fact that he is or was a director, officer, employee or agent of the Registrant, against expenses, including judgment and fines, if he acted in good faith and in a manner reasonably believed to be in or not opposed to our best interests and, with respect to criminal actions, in which he had no reasonable cause to believe that his conduct was unlawful. Similar provisions apply to actions brought by or in the right of the Registrant, except that no indemnification shall be made in such cases when the person shall have been adjudged to be liable for negligence or misconduct to the Registrant unless deemed otherwise by the court. Indemnifications are to be made by a majority vote of a quorum of disinterested directors or the written opinion of independent counsel or by the shareholders or by the court.
Article VII of the Registrants Amended and Restated Code of Regulations includes the following provisions related to indemnification of its directors, officers, employees and agents.
ARTICLE VII INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 1. Right to Indemnification. Each person who was or is made a party or is threatened to be made a party to or is otherwise involved (including, without limitation, as a witness) in any actual or threatened action, claim, suit investigation or proceeding, of any nature whatsoever (hereinafter proceeding), by reason of the fact that he or she is or was a director, board member, committee member, partner, trustee, officer or employee of any foreign or domestic organization or any separate investment account, or any individual who serves in any capacity with respect to any employee benefit plan, or that, being or having been such a director, board member, committee member, partner, trustee, officer or employee of any foreign or domestic organization or any separate investment account or any individual who serves in any capacity with respect to any employee benefit plan, he or she is or was serving at the request of an executive officer of the Corporation as a director, board member, committee member, partner, trustee, officer, employee or agent of another corporation or of a partnership, joint venture, trust, limited liability company or other enterprise, including service with respect to an employee benefit plan (hereinafter an indemnitee), whenever the basis of such proceeding is alleged action in an official capacity as such shall be indemnified and held harmless by the Corporation to the fullest extent permitted by law, as the same exists or may hereinafter be amended (but, in the case of any such amendment, only to the extent that such amendment permits the Corporation to provide broader indemnification rights than permitted prior thereto), or by other applicable law as then in effect, against all costs and reasonable counsel fees, fines, penalties, judgments or awards of any kind, and the amount of reasonable settlements, whether or not payable to the Corporation or to any of the other entities described above actually incurred or suffered by such indemnitee in connection therewith and such indemnification shall continue as to an indemnitee who has ceased to be a director, board member, committee member, partner, trustee, officer or employee of any foreign or domestic organization or any separate investment account or any individual who serves in any capacity with respect to any employee benefit plan and shall inure to the benefit of the indemnitees heirs, executors, legal representatives and administrators. To the extent any of the indemnification provisions set forth above prove to be ineffective for any reason in furnishing the indemnification provided, each of the persons named above shall be indemnified by the Corporation to the fullest extent not prohibited by applicable law.
Part II Page 1
Notwithstanding the foregoing, no indemnification shall be provided with respect to:
1. any matter as to which the person shall have been adjudicated in any proceeding not to have acted in good faith in the reasonable belief that his or her action was in the best interests of the Corporation or, to the extent that such matter relates to service with respect to any employee benefit plan, in the best interests of the participants or beneficiaries of such employee benefit plan;
2. any liability to any entity which is registered as an investment company under the Federal Investment Company Act of 1940 or to the security holders thereof, where the basis for such liability is willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of the office; and
3. any action, claim or proceeding voluntarily initiated by any person seeking indemnification, unless such action, claim or proceeding had been authorized by the Board or unless such persons indemnification is awarded by vote of the Board.
In any matter disposed of by settlement or in the event of an adjudication which in the opinion of the General Counsel or his or her delegate does not make a sufficient determination of conduct which could preclude or permit indemnification in accordance with the preceding paragraphs, the person shall be entitled to indemnification unless, as determined by the majority of the disinterested directors or in the opinion of counsel (who may be an officer of the Corporation or outside counsel employed by the Corporation), such persons conduct was such as precludes indemnification under any such paragraph. The termination of any action, claim, suit, investigation or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent shall not, of itself, create a presumption that the person did not act in good faith and in a manner which he or she reasonably believed to be in the best interests of the Corporation.
1.1 Advancements. The Corporation may at its option indemnify for expenses incurred in connection with any action or proceeding in advance of its final disposition, upon receipt of a satisfactory undertaking for repayment if it be subsequently determined that the person thus indemnified is not entitled to indemnification under this Article VII.
Section 2. Procedures for the Submission of Claims. The Board may establish reasonable procedures for the submission of claims for indemnification pursuant to this ARTICLE VII, determination of the entitlement of any person thereto, and review of any such determination.
Massachusetts Mutual Life Insurance Company (MassMutual), the Registrants parent company, maintains, at its expense, Directors and Officers Liability and Company Reimbursement Liability Insurance. The Directors and Officers Liability portion of such policy covers all directors and officers of MassMutual and of the companies which are, directly or indirectly, more than 50% owned by MassMutual, which includes the Registrant. The policy provides for payment on behalf of the directors and officers, up to the policy limits and after expenditure of a specified deductible, of all Loss (as defined) from claims made against them during the policy period for defined wrongful acts, and neglect or breach of duty by directors and officers in the discharge of their individual or collective duties as such. The insurance includes the cost of investigations and defenses, appeals, and settlements and judgments, but not fines or penalties imposed by law. The insurance does not cover any claims
Part II Page 2
arising out of acts alleged to have been committed prior to December 31,1996, or in the case of companies directly or indirectly 50% owned by MassMutual, which includes the Registrant, such later date as MassMutual or its predecessors may be deemed to control the company. The prior acts effective date for the Registrant is May 28, 2021. The policy contains various exclusions and reporting requirements.
Item 15. Recent Sales of Unregistered Securities
Not applicable
Item 16. Exhibits and Financial Statement Schedules
(a) Exhibits
(1) |
(2) | Plan of acquisition, reorganization, arrangement, liquidation or successionNot applicable. |
(3) | Governing Documents |
(a) | Amended and Restated Articles of Incorporation are filed herewith. |
(b) | Amended and Restated Code of Regulations are filed herewith. |
(4)(a) | Contracts |
(1) | Index Summit 6 Pro Individual Deferred Annuity Contract (Form No. P1833621NW) is filed herewith. |
(2) | Strategy Reallocation Endorsement (Form No. [ ]) will be filed by subsequent amendment. |
(4)(b) | Tax Endorsements |
(1) | Inherited Contract Endorsement (Form No. E1091612NW) (Non-Qualified Plans) is filed herewith. |
(2) | Individual Retirement Annuity Endorsement (Form No. E6004010NW) (IRA/SEP IRA) is filed herewith. |
(3) | Roth Individual Retirement Annuity Endorsement (Form No. E6004108NW) (Roth IRA) is filed herewith. |
(4) |
(5) |
(6) |
(7) |
(8) |
Part II Page 3
(9) |
(4)(c) | Strategy Endorsements |
(1) |
(2) |
(3) |
(4) |
(5) | S&P 500 1-Year 10% Buffer Indexed Strategy - Crediting Strategy EndorsementIndex Gain Subject to a Cap for Each TermIndex Loss Subject to a 10% Buffer for Each Term (Form No. E1842022NW) will be filed by subsequent amendment. |
(6) | S&P 500 1-year -10% Floor Indexed StrategyCrediting Strategy EndorsementIndex Gain Subject to a Cap for Each TermIndex Loss Subject to a -10% Floor for Each Term (Form No. E1850022NW) will be filed by subsequent amendment. |
(7) | S&P 500 1-year 0% Floor Indexed StrategyCrediting Strategy EndorsementIndex Gain Subject to a Cap for Each TermIndex Loss Subject to a 0% Floor for Each Term (Form No. E1850122NW) will be filed by subsequent amendment. |
(8) |
(9) |
Part II Page 4
(10) | iShares MSCI EAFE ETF 1-Year -10% Floor with Cap Indexed StrategyCrediting Strategy EndorsementIndex Gain Subject to a Cap for Each TermIndex Loss Subject to a -10% Floor for Each Term (Form No. E1850722NW) will be filed by subsequent amendment. |
(11) |
(12) |
(13) | iShares U.S. Real Estate ETF 1-Year -10% Floor with Cap Indexed StrategyCrediting Strategy EndorsementIndex Gain Subject to a Cap for Each TermIndex Loss Subject to a -10% Floor for Each Term (Form No. E1850622NW) will be filed by subsequent amendment. |
(14) | SPDR Gold Shares ETF 1-Year -10% Floor with Cap Indexed StrategyCrediting Strategy EndorsementIndex Gain Subject to a Cap for Each TermIndex Loss Subject to a -10% Floor for Each Term (Form No. E1850522NW) will be filed by subsequent amendment. |
(15) |
(16) |
(17) |
(18) |
(4)(d) | Waiver Riders |
(1) |
(2) |
Part II Page 5
(3) |
(5) | Opinion re Legality will be filed by subsequent amendment. |
(8) | Opinion re Tax MattersNot applicable. |
(9) | Voting Trust AgreementNot applicable. |
(10) | Material Contracts |
(a) |
(b) |
(c) |
(11) | Statement re Computation of Per Share EarningsNot applicable. |
(12) | Statements re Computation of RatiosNot applicable. |
(15) | Letter re Unaudited Interim Financial InformationNot applicable. |
(16) | Letter re Change in Certifying Accountant will be filed by subsequent amendment. |
(21) | Subsidiaries of the Registrant Information about the subsidiaries of MassMutual Ascend Life Insurance Company will be filed by subsequent amendment. |
(23) | Consents |
(a) | Consent of legal counsel will be filed by subsequent amendment. |
(b) | Consent of independent registered public accounting firms |
(i) | Consent of independent registered public accounting firm (KPMG LLP) will be filed by subsequent amendment. |
(ii) | Consent of independent auditors (Ernst & Young LLP) will be filed by subsequent amendment. |
(24) | Powers of Attorney |
(a) |
(b) |
(c) |
Part II Page 6
(d) |
(e) |
(f) |
(g) |
(h) |
(i) |
(j) |
(k) |
(l) |
(25) | Statement of Eligibility of TrusteeNot applicable. |
(26) | Invitation for Competitive BidsNot applicable. |
(99) | Additional Exhibits None. |
(101) | Interactive Data FileNot applicable. |
(b) | Financial Statements will be filed by subsequent amendment |
Notes to Statutory-Basis Financial Statements F-10
(c) |
Item 17. Undertakings
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:
(i) | To include any prospectus required by section 10(a)(3) of the Securities Act of 1933; |
(ii) | To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) (§ 230.424(b) of this chapter) if, in the aggregate, the changes in volume and price represent no more than 20% change in the maximum aggregate offering price set forth in the Calculation of Registration Fee table in the effective registration statement. |
(iii) | To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement; |
(2) | That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. |
(3) | To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. |
Part II Page 7
(4) | That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A (§ 230.430A of this chapter), shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use. |
(5) | That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities: The undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser: |
(i) | Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424 (§ 230.424 of this chapter); |
(ii) | Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant; |
(iii) | The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and |
(iv) | Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser. |
(6) | 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. |
Part II Page 8
INDEX TO EXHIBITS
MASSMUTUAL ASCEND LIFE INSURANCE COMPANY
Part II Page 9
Part II Page 10
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this Registration Statement on Form S-1 for the Individual Index-linked Modified Single Premium Deferred Annuity Contracts to be signed on its behalf by the undersigned, thereunto duly authorized in the City of Cincinnati, State of Ohio, on February 15, 2023.
MassMutual Ascend Life Insurance Company | ||||||
February 15, 2023 | By: | /s/ Brian P. Sponaugle | ||||
Brian P. Sponaugle | ||||||
Senior Vice President and Treasurer |
Pursuant to the requirements of the Securities Act of 1933, this Registration Statement on Form S-1 for the Individual Index-linked Modified Single Premium Deferred Annuity Contracts has been signed by the following persons in the capacities and on the dates indicated.
Signature |
Capacity |
Date | ||
/s/ Dominic L. Blue* |
Director | February 15, 2023 | ||
Dominic L. Blue* | ||||
/s/ Susan M. Cicco* |
Director | February 15, 2023 | ||
Susan M. Cicco* | ||||
/s/ Geoffrey J. Craddock* |
Director | February 15, 2023 | ||
Geoffrey J. Craddock* | ||||
/s/ Roger W. Crandall* |
Director | February 15, 2023 | ||
Roger W. Crandall* | ||||
/s/ Michael R. Fanning* Michael R. Fanning* |
Director Chief Executive Officer (principal executive officer) |
February 15, 2023 | ||
/s/ Paul A. LaPiana* |
Director | February 15, 2023 | ||
Paul A. LaPiana* | ||||
/s/ Sears Merritt* |
Director | February 15, 2023 | ||
Sears Merritt* | ||||
/s/ Mark F. Muething* |
President Director |
February 15, 2023 | ||
Mark F. Muething* | ||||
/s/ Michael J. OConnor* |
Director | February 15, 2023 | ||
Michael J. OConnor* | ||||
/s/ Eric W. Partlan* |
Director | February 15, 2023 | ||
Eric W. Partlan* | ||||
/s/ Brian P. Sponaugle |
Principal Accounting Officer | February 15, 2023 | ||
Brian P. Sponaugle | ||||
/s/ Arthur W. Wallace* |
Director | February 15, 2023 | ||
Arthur W. Wallace* | ||||
/s/ Elizabeth A. Ward* |
Chief Financial Officer (principal financial officer) Director | February 15, 2023 | ||
Elizabeth A. Ward* | ||||
*By:
/s/ John P. Gruber |
As Attorney-in-Fact pursuant to powers of attorney filed herewith | |||
John P. Gruber |
Date: February 15, 2023
Exhibit 3(a)
AMENDED AND RESTATED
ARTICLES OF INCORPORATION
OF
MASSMUTUAL ASCEND LIFE INSURANCE COMPANY
FIRST. The name of the company shall be MassMutual Ascend Life Insurance Company (the Company).
SECOND: The place in the State of Ohio where the Companys principal office is located is the city of Cincinnati in Hamilton County, Ohio.
THIRD. The purposes for which the Company is organized shall be:
(a) To make insurance upon the lives of individuals, and to transact every type of insurance allowed by Section 3911.01 of the Ohio Revised Code;
(b) To invest and reinvest its capital, surplus and accumulations in such investments as may now or in the future be permitted by law as investments of legal reserve life insurance companies; and
(c) To do all things necessary and proper to carry out the above purposes and to possess and have the right to exercise all powers and rights now or hereafter conferred by law upon domestic legal reserve life insurance companies under the laws of the State of Ohio.
FOURTH. All corporate powers of the Company shall be exercised by the Board of Directors and the Officers selected by the Board of Directors.
FIFTH. The number of Directors shall not be less than five nor more than twenty-one with the number of directors to be elected at any meeting of shareholders to be fixed by the shareholders at said meeting.
SIXTH. This corporation shall have Officers as may from time to time be fixed by the Board of Directors. All Officers shall hold office for a term of one year unless sooner removed by the Board of Directors.
SEVENTH. Vacancies among Directors shall be filled either by a majority vote of the remaining Directors or by a majority of shareholders entitled to vote, and the succeeding Director shall fill the unexpired term of the Director he is replacing. Vacancies among Officers shall be filled by the President. The succeeding Officer shall serve until the next annual meeting.
EIGHTH. The total number of shares which the Company shall be authorized to have outstanding shall be 1,200,000. All of these shares shall be Common Stock with a par value of $7.50 per share. Stated capital shall be $1,507,500.00
NINTH. No holder of any shares of the Company shall have any preemptive rights to subscribe for or to purchase any shares of the Company of any class, whether such shares or such class be now or hereafter authorized, or to purchase or subscribe for any security convertible into, or exchangeable for, shares of any class or to which shall be attached or appertained any warrants or rights entitling the holder thereof to purchase or subscribe for shares of any class.
TENTH. The Company, through its Board of Directors, shall have the right and power to purchase any of its outstanding shares at such price and upon such terms as maybe agreed upon between the Company and any selling shareholder.
ELEVENTH. The affirmative vote of shareholder entitled to exercise a majority of the voting power shall be required to amend these Articles of Incorporation, approve mergers and to take any other action which by law must be approved by a specified percentage of all outstanding shares entitled to vote.
TWELFTH. The provisions of Section 1701.831 of the Ohio Revised Code or any successor provisions relating to control share acquisitions shall not be applicable to the Company.
THIRTEENTH. These Amended and Restated Articles of Incorporation take the place of and supersede the existing Articles of Incorporation of the Company as heretofore amended and/or restated.
Exhibit 3 (b)
CODE OF REGULATIONS
OF
MASSMUTUAL ASCEND LIFE INSURANCE COMPANY
(As Amended and Restated on January 12, 2022)
ARTICLE I
SHAREHOLDERS MEETINGS
Section 1. Annual Meetings. The annual meeting of the shareholders of MassMutual Ascend Life Insurance Company (the Corporation), for the election of the Board of Directors (the Board) and the transaction of such other business as may properly be brought before such meeting, shall be held at the time, date and place designated by the Board or, if it shall so determine, by the Chairman of the Board or the President. If the annual meeting is not held or if directors are not elected thereat, a special meeting may be called and held for that purpose.
Section 2. Special Meetings. A special meeting of the shareholders may be called at any time by the Board on the same notice as is required for the annual meeting; provided, however, that notice of a special meeting shall specify the business to be considered thereat, and no other business shall be taken up or considered at special meetings unless the owners of a majority of the entire capital stock are present and unanimously consent thereto.
Section 3. Quorum. The shareholders attending in person or by proxy shall constitute a quorum at any meeting of shareholders, except in cases otherwise provided for by law; but less than a quorum may adjourn any meeting, from time to time, and the meeting may be held, as adjourned without further notice.
Section 4. Notice. Notice of the time and place, if any, and purposes of any meeting of shareholders and the manner of holding the meeting if it is to be conducted through communications equipment authorized by the Ohio General Corporation Law (the OGC Law), shall be given to each shareholder entitled thereto not less than seven (7) days nor more than sixty (60) days before the date fixed for the meeting and as prescribed by law. Such notice shall be given either by personal delivery or mail to the shareholders at their respective addresses as they appear upon the records of the Corporation or by any other method authorized by the OGC Law. Notice shall be deemed to have been given on the day sent. If any meeting is adjourned to another time or place, no notice as to such adjourned meeting need be given other than by announcement at the meeting at which such an adjournment is taken. No business shall be transacted at any such adjourned meeting except as might have been lawfully transacted at the meeting at which such adjournment was taken.
Section 5. Notice to Joint Owners. All notices with respect to any stock to which persons are entitled by joint or common ownership may be given to the person who is named first upon the books of this Corporation, and notice so given shall be sufficient notice to all the holders of such stock.
Section 6. Waiver. Notice of any meeting may be waived in writing by any shareholder either before or after any meeting, by attendance at such meeting in person or by proxy, or through communications equipment authorized by the OGC Law without protest to its commencement.
Section 7. Shareholders Entitled to Notice and to Vote. The Board is authorized from time to time, to fix a day, not more than forty (40) days prior to the day of holding any meeting of shareholders, as the day as of which shareholders entitled to notice of and to vote at such meeting shall be determined; and only shareholders of record on such day shall be entitled to notice or to vote at such meeting. If a record date shall not be fixed, the record date for the determination of shareholders entitled to notice of or to vote at any meeting of shareholders shall be the close of business on the twentieth (20th) day prior to the date of the meeting and only shareholders of record at such record date shall be entitled to notice of and to vote at such meeting.
Section 8. Action by Shareholders Without a Meeting. Any action which may be taken at a meeting of shareholders may be taken without a meeting if authorized by a writing or writings signed by all of the shareholders who would be entitled to notice of a meeting for such purpose or by any other method authorized by the OGC Law. The records of such action shall be entered upon the records of the Corporation.
ARTICLE II
BOARD OF DIRECTORS
Section 1. Number of Directors and Powers. The number of directors shall not be less than five (5) nor more than twenty-one (21). Except as reserved by law or by this Code of Regulations (the Regulations), the Board shall have and may exercise all the powers of the Corporation. The Board shall make such rules and regulations as it shall deem necessary or convenient for the regulation and management of the affairs of the Corporation.
Section 2. Place of Meeting. Any meeting of directors may be held at such place within or without the State of Ohio or by communications equipment authorized by the OGC Law as may be designated in the notice of said meeting.
Section 3. Organization Meeting. As promptly as practicable after each annual meeting a Secretary shall notify the directors-elect of their election, and shall notify all directors of the time at which they are required to meet for the purpose of organizing the new Board and of electing and appointing officers and committees for the succeeding year. Such meeting shall be appointed to be held on the day of the election, or as soon thereafter as practicable.
2
Section 4. Regular Meetings. Regular meetings of the Board shall be held at such stated times and places as the Board may determine by resolution, from time to time. No notice of any such meeting need be given. In case the day appointed for a regular meeting should fall upon a legal holiday, such meeting shall be held on the following business day, at the regularly appointed hour.
Section 5. Special Meeting. The Secretary shall call special meetings of the Board , at any time, upon order of the Chairman of the Board or the President, or of any two directors. Notice of the time and place, if any, of any special meeting of the Board and the manner of holding the meeting if it is to be conducted through communications equipment authorized by the OGC Law, shall be given to each director by personal delivery, telephone, facsimile transmission, mail or by communications equipment authorized by the OGC Law, at least twenty-four (24) hours before the meeting. Such notice need not specify the purpose of the meeting. Notwithstanding the foregoing, special meetings may be held at any time, without formal notice, if all directors are present, or if those not present shall have waived notice thereof.
Section 6. Quorum. Not less than one-third (1/3) of the number of directors in office, but in any event not less than three (3), shall be sufficient to constitute a quorum at any meeting of the Board, except in cases otherwise provided for by law; but less than a quorum may adjourn any meeting, from time to time, and the meeting may be held as adjourned, without further notice.
Section 7. Filling of Vacancies. In case of any increase in the number of directors, or of any vacancy created by death, resignation or removal by the Board or the shareholder, the additional director or directors may be elected, or, as the case may be, the vacancy or vacancies maybe filled, either (a) by the Board at any regular meeting, or at a special meeting called for the purpose, by a vote of a majority of the directors then in office, though less than a quorum, or (b) by vote of the holders of record of a majority in number of the shares of stock entitled to vote, at a special meeting of the shareholders called for the purpose.
Section 8. Board Action Without a Meeting. Any action which may be taken at a meeting of directors or any committee thereof may be taken without a meeting if authorized by a writing or writings signed by all of the members of the Board or all of the members of a particular committee or by any other method authorized by the OGC Law. The records of such action shall be entered upon the records of the Corporation.
Section 9. Exclusion of Liability. No director shall be personally liable to the Corporation for monetary damages for breach of fiduciary duty as a director, notwithstanding any provision of law imposing such liability; provided, however, that such director shall remain personally liable for damages incurred by the Corporation resulting from (a) any breach of the directors duty of loyalty to the Corporation, (b) acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law by the director, (c) acts or omissions not taken in a manner not reasonably believed to be in, or at least not opposed to, the best interest of the Corporation, (d) acts or omissions not taken with the care that a reasonably prudent person would use under similar circumstances, (e) any transaction from which the director derives an improper personal benefit, or (f) acts or omissions of the director which occurred prior to the effective date of this provision.
3
ARTICLE III
COMMITTEES OF THE BOARD
The Board shall have an Executive and a Finance Committee and shall create such other committees of the Board as it may deem necessary or convenient for the conduct of the business of the Corporation. The Board shall appoint the members of any such committee of the Board from its number on an annual basis, and a majority of the members of any committee shall constitute a quorum for the transaction of the business thereof unless otherwise specified in these Regulations. The Board may delegate to any such committee or committees some or all of the powers of the directors except those which by law or by these Regulations it is prohibited from delegating. Except as the Board may otherwise determine, any such committee may make rules for the conduct of its business.
ARTICLE IV
EXECUTIVE COMMITTEE
Section 1. Appointment, Term and Vacancies. At the organization meeting of the Board each year, the Board may appoint from their own number an Executive Committee; or if no appointment is made at such meeting, the Board may, at a regular or special meeting, appoint from their own number an Executive Committee. The Executive Committee shall consist of not less than three (3) nor more than five (5) directors, and the members thereof shall serve for one (1) year and until their successors shall have been appointed. In case any vacancy shall occur in the membership of the Executive Committee, the Board shall have power to fill such vacancy for the remainder of the term, by resolution adopted by a majority of the entire Board.
Section 2. Quorum. Any two of the members of the Executive Committee shall constitute a quorum for the transaction of the business thereof.
Section 3. Rules and Reports. The Executive Committee may make rules for holding and conducting its meetings and keeping the records thereof, and shall regularly report its actions to the Board.
Section 4. Powers and Duties. The Executive Committee shall have, and may exercise during intervals between meetings of the Board all the authority of the Board except as to each of the following matters:
(a) the submission to shareholders of any action as to which shareholders authorization is required by statute;
4
(b) the filling of vacancies in the Board or in any committee of the Board;
(c) the amendment or repeal of the Regulations, or the adoption of new code of regulations; and
(d) the amendment or repeal of any resolution of the Board which by its terms shall not be so amendable or repealable.
ARTICLE V
FINANCE COMMITTEE
Section 1. Appointment, Term and Vacancies. At the organizational meeting of the Board, in each year, the Board, by resolution, adopted by a majority of the entire Board, may appoint from their own number a Finance Committee. The Finance Committee shall consist of not less than three (3) nor more than five (5) directors, and the members thereof shall serve for one (1) year and until their successor shall have been appointed. In case any vacancy shall occur in the membership of the Finance Committee, the Board shall have power to fill such vacancy for the remainder of the term, by resolution adopted by a majority of the entire Board.
Section 2. Quorum. A majority of the members of the Finance Committee shall constitute a quorum for the transaction of the business thereof.
Section 3. Rules and Reports. The Finance Committee may make rules for holding and conducting its meetings and keeping the records thereof, and shall regularly report its actions to the Board.
Section 4. Powers and Duties. The Finance Committee does have and shall continue to have the following powers and duties:
(a) to direct and control the financial affairs of the Corporation on a daily basis and shall exercise all authority of the full Board with respect to all such financial affairs;
(b) to authorize and effectuate all investment transactions on behalf of the Corporation, including but not limited to the purchase, sale or exchange of stocks, bonds, notes, equipment trust certificates, mortgages or any other securities or assets of the Corporation;
(c) to designate banks or trust companies as custodians for stocks, bonds, notes or other securities belonging to the Corporation; and
5
(d) to authorize and designate the proper individuals to prepare and execute on behalf of the Corporation all documents necessary to carry out such transactions and take any and all actions as may be necessary or desirable to fully implement the foregoing powers.
ARTICLE VI
OFFICERS: POWERS AND DUTIES
Section 1. Officers. The officers of the Corporation shall consist of a Chairman of the Board, a Vice Chairman of the Board, a Chief Executive Officer, a President (each of whom shall be a director), one or more Vice Presidents, a Secretary, a Treasurer, and such Assistant Vice Presidents, Assistant Secretaries, Assistant Treasurers or other officers as, from time to time, may appear to the Board necessary or desirable for the conduct of the affairs of the Corporation. The office of Chairman of the Board and President or any two other offices, other than those of President and Secretary, may be held by the same person.
Section 2. Powers and Duties. Each officer elected by the Board shall have such powers and duties as may be assigned from time to time by the Board or by the Chief Executive Officer at the direction of the Board.
Section 3. Appointment, Term and Removal. So far as practicable, all officers, except those whose appointment is herein otherwise provided for, shall be elected or appointed by the Board at its organization meeting in each year, and (unless sooner disqualified) shall serve until the next annual meeting of the Corporation next following their election or appointment, as the case may be, and until their successors shall be elected or appointed. Any such officer may, however, be removed for cause, at any time, by a majority vote of the whole number of directors.
Section 4. Subordinates, Officers and Agents. The Board in its discretion, may, from time to time, appoint such subordinate officers, employees and agents as it may deem advisable, and may remove or suspend the same at pleasure; or it may delegate to the Chairman of the Board, the Vice Chairman of the Board or the President authority to make such appointments. The Chief Executive Officer shall have the power to designate an officer or employee to perform the duties of any officer who is unable to perform such duties for any reason.
Section 5. Chairman, Vice Chairman, Chief Executive Officer and the President. The Chairman of the Board shall be a member of the Executive Committee of the Board and shall preside and make reports when present at all meetings of the shareholders, the Board, and the Executive Committee, unless otherwise provided by law.
In the absence of the Chairman of the Board, the Vice Chairman of the Board shall preside and make reports at all meetings of the shareholders and the Board, unless otherwise provided by law.
The Chief Executive Officer shall have general and active direction and control of the affairs of the Corporation. He or she shall be a member of the Executive Committee of the Board and in the absence of the Chairman of the Board, he or she shall have and exercise the authority vested in the Chairman of the Board, and in the absence of the Chairman of the Board and the Vice Chairman of the Board, shall preside and make reports at all meetings of the shareholders the Board, and the Executive Committee, unless otherwise provided by law.
6
The President may be a member of the Executive Committee of the Board. He or she shall have authority to sign stock certificates.
The Chairman of the Board, the Vice Chairman of the Board, the Chief Executive Officer and the President shall each have general power and authority to sign and execute in the name and on behalf of the Corporation any and all bonds, undertakings, recognizances, contracts of indemnity, insurance policies, renewals of insurance policies, deeds, conveyances, leases, releases, satisfaction pieces and other instruments or writings; to affix the corporate seal, to countersign checks, drafts and bills of exchange, subject to the provisions of the Contract Signing and Disbursement Authority Policy approved by the Board, as may be amended from time to time, and any other provisions of these Regulations.
Section 6. Vice Presidents and Assistant Vice Presidents. Each Vice President and Assistant Vice President shall have power to sign and execute, in the name and on behalf of the Corporation, any and all bonds, undertakings, recognizances, contracts of indemnity, insurance policies and renewals of policies, deeds, conveyances, leases, releases, satisfaction pieces and other instruments or writings, to sign stock certificates, and to countersign checks, drafts and bills of exchange, subject to the provisions of the Contract Signing and Disbursement Authority Policy approved by the Board, as may be amended from time to time, and any other provisions of these Regulations.
Section 7. Secretary and Assistant Secretaries. The Secretary and Assistant Secretaries shall have power and authority to affix the corporate seal and attest any and all instruments or writings to which the corporate seal may be affixed. The Secretary shall exercise the powers and perform the duties usually appertaining to the secretary of a corporation; provided, that the President may assign to the Secretary or Assistant Secretaries particular duties to be performed by them and shall, from time to time, assign to the Secretary the duty of giving notices of meetings of the shareholders, of the Board and of the Executive Committee and of keepings minutes of the proceedings thereat.
The Assistant Secretaries shall, in the absence or disability of the Secretary, perform the duties of such officers and shall generally assist such officers.
Section 8. Treasurer and Assistant Treasurer. The Treasurer and Assistant Treasurer shall have the care and custody of cash, cash equivalent and securities of the Corporation, and shall deposit or cause to be deposited all funds of the Corporation in and with financial institutions as the Treasurer, Board or a committee thereof shall, from time to time, direct. The Treasurer shall have the authority to sign stock certificates, to endorse for deposit or collection, or other-wise, all checks, drafts, notes, bills of exchange, or other commercial paper on the secondary market
7
payable to the Corporation. The Treasurers office shall keep in its custody full and accurate accounts information, receipts and disbursements in books belonging to the Corporation. The Treasurer shall generally have all the powers and perform all the duties usually appertaining to the office of Treasurer of the Corporation. In the absence or disability of the Treasurer, an Assistant Treasurer shall perform his or her duties.
Section 9. Accounting. The President shall also, from time to time, designate one of the officers whose duties (in addition to any others which may be assigned to him or her), shall be, to keep the accounts and books of the Corporation in proper order and ready for inspection at any time when requested by the Board or the Executive Committee; to prepare for submission to the Board, semi-annually, a full and complete statement of all assets and liabilities of the Corporation, and to prepare and file, when due, any and all tax returns or other statements or certificates required by law. In his or her absence or disability, such other officer as the President may designate shall perform the duties assigned by him or her.
Section 10. Additional Powers and Duties. In addition to the foregoing especially enumerated powers and duties, the several officers of the Corporation shall have such other powers and duties as are provided for them in these Regulations or as may, from time to time, be prescribed by the Board or the Executive Committee, the Chief Executive Officer or the President.
Section 11. Apparent Authority. Any act done by any officer of the Corporation within the apparent scope of his or her authority shall be binding upon the Corporation and no person dealing with the Corporation shall be bound to inquire with respect to the actual extent of such authority.
ARTICLE VII
INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 1. Right to Indemnification. Each person who was or is made a party or is threatened to be made a party to or is otherwise involved (including, without limitation, as a witness) in any actual or threatened action, claim, suit investigation or proceeding, of any nature whatsoever (hereinafter proceeding), by reason of the fact that he or she is or was a director, board member, committee member, partner, trustee, officer or employee of any foreign or domestic organization or any separate investment account, or any individual who serves in any capacity with respect to any employee benefit plan, or that, being or having been such a director, board member, committee member, partner, trustee, officer or employee of any foreign or domestic organization or any separate investment account or any individual who serves in any capacity with respect to any employee benefit plan, he or she is or was serving at the request of an executive officer of the Corporation as a director, board member, committee member, partner, trustee, officer, employee or agent of another corporation or of a partnership, joint venture, trust, limited liability company or other enterprise, including service with respect to an employee benefit plan (hereinafter an indemnitee), whenever the basis of such proceeding is alleged action in an official capacity as such shall be indemnified and held harmless by the Corporation to the fullest extent permitted by
8
law, as the same exists or may hereinafter be amended (but, in the case of any such amendment, only to the extent that such amendment permits the Corporation to provide broader indemnification rights than permitted prior thereto), or by other applicable law as then in effect, against all costs and reasonable counsel fees, fines, penalties, judgments or awards of any kind, and the amount of reasonable settlements, whether or not payable to the Corporation or to any of the other entities described above actually incurred or suffered by such indemnitee in connection therewith and such indemnification shall continue as to an indemnitee who has ceased to be a director, board member, committee member, partner, trustee, officer or employee of any foreign or domestic organization or any separate investment account or any individual who serves in any capacity with respect to any employee benefit plan and shall inure to the benefit of the indemnitees heirs, executors, legal representatives and administrators. To the extent any of the indemnification provisions set forth above prove to be ineffective for any reason in furnishing the indemnification provided, each of the persons named above shall be indemnified by the Corporation to the fullest extent not prohibited by applicable law.
Notwithstanding the foregoing, no indemnification shall be provided with respect to:
1. any matter as to which the person shall have been adjudicated in any proceeding not to have acted in good faith in the reasonable belief that his or her action was in the best interests of the Corporation or, to the extent that such matter relates to service with respect to any employee benefit plan, in the best interests of the participants or beneficiaries of such employee benefit plan;
2. any liability to any entity which is registered as an investment company under the Federal Investment Company Act of 1940 or to the security holders thereof, where the basis for such liability is willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of the office; and
3. any action, claim or proceeding voluntarily initiated by any person seeking indemnification, unless such action, claim or proceeding had been authorized by the Board or unless such persons indemnification is awarded by vote of the Board.
In any matter disposed of by settlement or in the event of an adjudication which in the opinion of the General Counsel or his or her delegate does not make a sufficient determination of conduct which could preclude or permit indemnification in accordance with the preceding paragraphs, the person shall be entitled to indemnification unless, as determined by the majority of the disinterested directors or in the opinion of counsel (who may be an officer of the Corporation or outside counsel employed by the Corporation), such persons conduct was such as precludes indemnification under any such paragraph. The termination of any action, claim, suit, investigation or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent shall not, of itself, create a presumption that the person did not act in good faith and in a manner which he or she reasonably believed to be in the best interests of the Corporation.
9
1.1 Advancements. The Corporation may at its option indemnify for expenses incurred in connection with any action or proceeding in advance of its final disposition, upon receipt of a satisfactory undertaking for repayment if it be subsequently determined that the person thus indemnified is not entitled to indemnification under this Article VII.
Section 2. Procedures for the Submission of Claims. The Board may establish reasonable procedures for the submission of claims for indemnification pursuant to this ARTICLE VII, determination of the entitlement of any person thereto, and review of any such determination.
ARTICLE VIII
EXECUTION OF INSURANCE POLICIES AND OTHER DOCUMENTS
All policies of insurance shall be signed by the Chairman of the Board, the Vice Chairman of the Board, the President or a Vice President or Assistant Vice President and countersigned by the Secretary or an Assistant Secretary, and shall be binding and obligatory upon the Corporation in the same manner as if executed under the seal of the Corporation.
The Board may authorize the placing of signatures on policies, checks, receipts or other instruments by machine or other device for the imprinting or writing of signatures. All instruments bearing authorized signatures may be continued in use for a period of six months from the date of termination, for any reason, of the term of office of any officer whose facsimile signature appears thereon, and all such instruments shall have the same force and effect as though such officer were still in office.
ARTICLE IX
STOCK AND STOCK CERTIFICATES
Section 1. Stock Certificates. The stock of the Corporation shall be represented by certificates, in form prescribed by law, which shall be signed by the President or a Vice President or an Assistant Vice President and the Secretary, or an Assistant Secretary, and shall be sealed with the seal of the Corporation.
Section 2. Transfer of Shares. Shares of stock may be transferred by delivery of the certificates therefor, accompanied either by an assignment in writing on the reverse of the certificates, or by written power of attorney to sell, assign and transfer the same, signed by the record holder thereof; but no transfer shall affect the right of the Corporation to pay any dividends upon the stock to the holder of record thereof, or to treat the holder of record as the holder in fact thereof for all purposes, and no transfer shall be valid, except between the parties thereto, until such transfer shall have been made upon the books of the Corporation.
10
ARTICLE X
AMENDMENTS
These Regulations may be amended by the affirmative vote, written consent, or such other method authorized by the OGC Law, of shareholders entitled to exercise a majority of the voting power on such proposal. If an amendment is adopted by written consent the Secretary shall transmit by mail or any other means of communication authorized by the OGC Law a copy of such amendment to each shareholder who would be entitled to vote thereon and did not participate in the adoption thereof. These Regulations may also be amended by the affirmative vote of a majority of the directors to the extent permitted by the OGC Law at the time of such amendment.
ARTICLE XI
MISCELLANEOUS
Section 1. Conflict With Applicable Law Or Articles Of Incorporation. Unless the context requires otherwise, the general provisions, rules of construction, and the definitions of the Ohio Revised Code shall govern the construction of these Regulations. These Regulations are adopted subject to any applicable law and the Articles of Incorporation. Whenever these Regulations may conflict with any applicable law or the Articles of Incorporation, such conflict shall be resolved in favor of such law or the Articles of Incorporation.
Section 2. Invalid Provisions. If any one or more provisions of these Regulations, or the applicability of any provision to a specific situation, shall be held invalid or unenforceable, then such provision shall be modified to the minimum extent necessary to make it (and its application) valid and enforceable, and the validity and enforceability of the remaining provisions of these Regulations and all other applications of any provision shall not be affected thereby.
11
Exhibit 4(a)(1)
Home Office: Cincinnati, Ohio
[Administrative Office: P.O. Box 5423, Cincinnati, Ohio 45201-5423]
[Marketing Name]
Individual Deferred Variable Annuity Contract
[Tax Qualification]
Indexed Crediting Strategies
Flexible Purchase Payments for Limited Period
Nonparticipating No Dividends
This is your annuity contract. It is a legally binding agreement between you and us. It provides that we will pay the Annuity Payout Benefit to you in exchange for your Purchase Payment(s). PLEASE READ THIS CONTRACT WITH CARE.
As you read through this contract, please note that the words we, us, our, and Company refer to MassMutual Ascend Life Insurance Company. The words you and your refer to the Owner, including a joint owner, if any. The word Contract refers to this annuity contract. Other capitalized terms are defined on the Contract Specifications page or by a specific provision of this Contract.
This Contract is a deferred annuity, which means the Annuity Payout Benefit is to begin on a future date. It is a variable annuity, which means that when funds are applied to an Indexed Strategy, Contract values and benefits may decrease or increase based in part by the change in an external market index, rate, or value over a specified Term, and are not guaranteed as to fixed dollar amounts. However, this Contract does not directly participate in any equity, debt, or other investments. This Contract allows flexible Purchase Payments for a limited period, which means you may make one or more Purchase Payments during the Purchase Payment Period. It is nonparticipating, which means it does not pay dividends or share in the Companys divisible surplus.
This Contract is a [tax qualification]. {Please refer to the tax qualification endorsement for important provisions.}
[ ] | [ ] | |
[Mark F. Muething] | [John P. Gruber] | |
[President] | [Secretary] |
TWENTY DAY EXAMINATION RIGHT TO CANCEL
You may cancel this Contract by returning it and giving written notice of cancellation. You have until midnight of the 20th day following the date you receive it, or such longer period as may be provided by law. If you purchased this Contract to replace an existing annuity contract or life insurance policy, you have until midnight of the 30th day following the date you receive it. To cancel, you must return this Contract and give the required notice either to us or to the producer who sold it to you, in person or by mail. If by mail, the return of this Contract or notice is effective on the date it is postmarked, with the proper address and with postage paid. If you cancel this Contract as set forth above, this Contract shall be void and we will refund the Account Value, or if required by law, the Purchase Payments made for it. If we are required to refund the Purchase Payments, we reserve the right to hold Purchase Payments in the Purchase Payment Account until the first Strategy Application Date on or after the end of the examination period.
P1833621NW |
(Rev. 10/22) |
TABLE OF CONTENTS |
Page | |||
HOW TO CONTACT US |
2 | |||
CONTRACT SPECIFICATIONS |
3 | |||
OWNER |
6 | |||
ANNUITANT |
7 | |||
BENEFICIARY |
8 | |||
PURCHASE PAYMENTS |
8 | |||
CONTRACT VALUES |
9 | |||
INTEREST AND GAIN OR LOSS |
10 | |||
CHARGES |
11 | |||
CASH BENEFIT |
12 | |||
ANNUITY PAYOUT BENEFIT |
13 | |||
DEATH BENEFIT |
15 | |||
PAYOUT OPTIONS |
17 | |||
GENERAL PROVISIONS |
19 | |||
ENDORSEMENTS AND RIDERS (IF ANY) |
HOW TO CONTACT US
Administrative Office: For information and assistance, or to make a complaint, election, or request, call or write:
[Policy Administration]
MassMutual Ascend Life Insurance Company
[P.O. Box 5423
Cincinnati, Ohio 45201-5423
1-800-789-6771]
If you prefer, you may visit us at our website, [www.MassMutualAscend.com]
Request in Good Order: Any election or request you make to us under this Contract must be a Request in Good Order. A Request in Good Order is an election or request that is:
1) | complete and satisfactory to us; |
2) | sent to us on our form or in a manner satisfactory to us, which may, at our discretion, be by telephone or electronic means; and |
3) | received by us at our Administrative Office. |
We are not bound by a request until we acknowledge it. We will deem a Request in Good Order to be a standing order. It may be modified or revoked only by a subsequent Request in Good Order, when permitted by the provisions of this Contract. You may be required to return this Contract to us in connection with a request.
If a Request in Good Order is received by us on a day that is not a Market Day, or after the first Market Close of a Market Day, we will treat it as if it were received at the start of the next Market Day.
P1833621NW |
2 | (Rev. 10/22) |
CONTRACT SPECIFICATIONS
CONTRACT
Contract Number: |
[000000000] | |
Contract Effective Date: |
[May 1, 2015] | |
Contract Anniversary: |
[May 1] of each year after the Contract Effective Date | |
Contract Year: |
A 12-month period that starts on the Contract Effective Date or on a Contract Anniversary. | |
Annuity Payout Initiation Date |
||
Earliest Permitted Date: |
[May 1, 2016] | |
Latest Permitted Date: |
[May 1, 2075] | |
The latest permitted date may change if an Owner of this Contract changes. |
Minimum Required Value: |
[$5,000] | |
Minimum Fixed Period Payout: |
[10 years] | |
Contract Charge Rate: |
[0.75%] |
OWNER{S}
[JOHN DOE] |
[JANE DOE] |
ANNUITANT{S}
[JOHN DOE] |
[JANE DOE] |
{BENEFICIARY
{NONE} |
{Primary Beneficiar[y][ies] |
[JANE DOE. Spouse] |
[50% JIMMY DOE, Son] |
[50% JUNE DOE, Daughter]} |
{Contingent Beneficiar[y][ies] |
[50% JIMMY DOE, Son] |
[50% JUNE DOE, Daughter]} |
Beneficiary designations are subject to the rights of a Joint Owner, if any, and to a change of Beneficiary made after the date this Contract was printed, and to other Contract rules. Beneficiary designations do not apply after the Annuity Payout Initiation Date.}
P1833621NW |
3 |
PURCHASE PAYMENTS
Initial Purchase Payment: |
[$25,000.00] | |
Additional Purchase Payment Minimum: |
[$10,000.00] | |
Total Purchase Payment Maximum: |
[$1,000,000.00] | |
Purchase Payment Period: |
[First Two Months of Contract] |
CREDITNG STRATEGIES
Strategy Application Date: [the 6th and 20th day of each month]
Strategies: | Initial Selection |
|||
[S&P 500® 1-Year Maximum Gain Indexed Strategy] |
[10 | %] | ||
[S&P 500® 2-Year Maximum Gain Indexed Strategy] |
[10 | %] | ||
[S&P 500® 1-Year Uncapped Gain Indexed Strategy] |
[10 | %] | ||
[S&P 500® 2-Year Uncapped Gain Indexed Strategy] |
[10 | %] | ||
[iShares MSCI EAFE ETF 1-Year Uncapped Gain Indexed Strategy] |
[10 | %] | ||
[iShares MSCI EAFE ETF 1-Year Uncapped Gain Indexed Strategy] |
[10 | %] | ||
[iShares US Real Estate ETF 1-Year Uncapped Gain Indexed Strategy] |
[10 | %] | ||
[iShares US Real Estate ETF 2-Year Uncapped Gain Indexed Strategy] |
[10 | %] |
Each Crediting Strategy is described in an endorsement to this Contract. Please refer to the Strategy endorsements for important provisions and disclosures.
Term: |
A Term is the period for which Contract values are allocated to a given Crediting Strategy, and over which gain or loss is calculated. Each Term will start and end on a Strategy Application Date. A new Term will start at the end of the preceding Term. | |
Market Day: |
A Market Day is each day that all markets that are used to measure available Indexed Strategies are open for regular trading. | |
Market Close: |
A Market Close is the close of the regular or core trading session on the market used to measure a given Indexed Strategy. |
P1833621NW |
4 |
EARLY WITHDRAWAL CHARGE
Contract Year |
1 | 2 | 3 | 4 | 5 | 6 | 7+ | |||||||||||||||||||||
Early Withdrawal Charge Rate |
9 | % | 8 | % | 7 | % | 6 | % | 5 | % | 4 | % | 0 | % |
Free Withdrawal Percentage: [10%]
P1833621NW |
5 |
OWNER
Owner
The Owner of this Contract is the person who possesses all of the ownership rights under this Contract. The Owner on the Contract Effective Date is set out on the Contract Specifications page.
If the cover page of this Contract states that it is a Nonqualified Annuity, then it may be owned by two persons jointly. If there is a joint Owner, the term Owner includes the joint Owner, and you must exercise all rights of ownership by joint action.
You may change the Owner as provided in the Change of Owner provision of this Contract. A surviving spouse may become the Owner pursuant to the Successor Owner provision of this Contract.
If an Owner is a trust, custodial account, corporation, limited liability company, partnership, or other entity, then the age of the eldest Annuitant is treated as the age of the Owner for all purposes of this Contract.
Assignment
If this Contract has a tax qualification endorsement, then you may not pledge, charge, encumber, or in any way assign your interest in this Contract except to the limited extent as may be provided in the tax qualification endorsement and the loan endorsement, if any.
If the cover page states that this Contract is a Nonqualified Annuity, then you may pledge, charge, encumber, or in any way assign your interest in this Contract only with our written consent. We will review such requests for such consent on a nondiscriminatory basis.
When permitted, you may assign all or any part of your rights under this Contract, except your rights to:
1) | designate or change a Beneficiary; |
2) | designate or change an Annuitant; |
3) | change Owners; or |
4) | elect a Payout Option. |
We are not responsible for the validity or tax effects of an assignment. An assignment must be made by a Request in Good Order.
The rights of a person holding an assignment, including the right to any payment under this Contract, come before the rights of an Owner, Annuitant, Beneficiary, or other payee. An assignment may be ended only by the person holding it or as provided by law.
Change of Owner
If this Contract has a tax qualification endorsement, then you may not transfer, sell, or in any way alienate your interest in this Contract except to the limited extent provided in the tax qualification endorsement.
If the cover page states that this Contract is a Nonqualified Annuity, then you may transfer ownership of this Contract only with our written consent.
A change of Owner must be made by a Request in Good Order. A change of Owner cancels all prior Beneficiary designations. It does not cancel a designation of an Annuitant or a Payout Option election.
P1833621NW |
6 |
Successor Owner
Your spouse becomes the successor owner of this Contract and succeeds to all rights of ownership if all of the following requirements are met:
1) | a Death Benefit is payable on account of your death; |
2) | the sole Beneficiary under this Contract is your spouse, or a revocable trust or custodial account created by your spouse; |
3) | your spouse makes that election by a Request in Good Order before the Death Benefit Payout Date; and |
4) | you were not a successor owner of this Contract. |
A successor owner election cancels all prior Beneficiary designations. It does not cancel a designation of an Annuitant or a Payout Option election.
If state law extends this successor owner right to a civil union partner or other person who is not your spouse as defined by federal tax law, then distributions after your death must be made as required by the Death Benefit Distribution Rules provision of this Contract.
Community Property
If you live in a community property state and have a spouse at any time while you own this Contract, the laws of that state may vary your ownership rights.
ANNUITANT
The Annuitant is the natural person or persons on whose life the Annuity Payout Benefit is based. The Annuitant on the Contract Effective Date is set out on the Contract Specification page.
If this Contract has a tax qualification endorsement, then the Annuitant must be the natural person covered under the retirement arrangement for whose benefit this Contract is held.
If the cover page states that this Contract is a Nonqualified Annuity, then the Annuitant cannot be changed at any time that it is owned by a trust, custodial account, corporation, limited liability company, partnership, or other entity.
Otherwise, you may change a designation of Annuitant by a Request in Good Order at any time before the Annuity Payout Initiation Date.
If an Annuitant dies before the Annuity Payout Initiation Date and no Death Benefit is payable, then in the absence of a new designation, the Annuitant shall be the surviving joint Annuitant(s), or if none, the Owner(s).
P1833621NW |
7 |
BENEFICIARY
Beneficiary
A Beneficiary is a person entitled to receive all or part of a Death Benefit that is to be paid under this Contract on account of a death before the Annuity Payout Initiation Date.
If a Death Benefit becomes payable on account of your death or the death of a joint Owner, then the surviving Owner is the Beneficiary no matter what other designation you may have made.
In all other cases, you may designate person or persons who will be the Beneficiary(ies) as provided in the Designation of Beneficiary provision of this Contract.
If no designated Beneficiary is surviving, then the Beneficiary is your estate.
Designation of Beneficiary
A designation of Beneficiary must be made by a Request in Good Order, received by us on or before the date of death for which a Death Benefit is payable.
You may designate two or more persons jointly as the Beneficiaries. Unless you state otherwise, joint Beneficiaries that are surviving are entitled to equal shares. You may also designate one or more persons as contingent Beneficiary. Unless you state otherwise, a contingent Beneficiary is entitled to a benefit only if there is no primary Beneficiary that is surviving.
Survivorship Required
In order to be entitled to receive a Death Benefit, a Beneficiary must survive for at least 30 days after the death for which the Death Benefit is payable. If you designate your spouse as a Beneficiary and your marriage ends before your death, we will treat your former spouse as having predeceased you except:
1) | to the extent a court order provides that the former spouses rights as a beneficiary are to continue; or |
2) | to the extent he or she remains or becomes an Owner. |
PURCHASE PAYMENTS
A Purchase Payment is an amount received by us for this Contract. It is determined after deducting any taxes withheld from the payment, and after deducting any fee charged by the person remitting payment.
You may make one or more Purchase Payments to us for this Contract.
The initial Purchase Payment must be received by us on or before the Contract Effective Date.
Each additional Purchase Payment must at least equal the minimum that is set out on the Contract Specifications page. Each additional Purchase Payment must be received by us at our Administrative Office on or before the earliest of the following:
1) | the last day of the Purchase Payment Period that is set out on the Contract Specifications page; |
2) | the Annuity Payout Initiation Date; |
3) | a death for which a Death Benefit is payable; and |
4) | the date that this Contract is surrendered. |
Total Purchase Payments cannot exceed the maximum that is set out on the Contract Specifications Page.
Upon request, we will provide you with a receipt for a Purchase Payment as proof of payment.
P1833621NW |
8 |
CONTRACT VALUES
Account Value
The Account Value of this Contract is equal to the sum of the values of each Crediting Strategy, plus the value of the Purchase Payment Account, if any.
Indexed Strategy Value
The value of an Indexed Strategy is equal to:
1) | the investment base for that Term, which is the amount applied to the Strategy at the start of the current Term; minus |
2) | the sum of the daily Contract Charges subtracted from the investment base during the current Term; minus |
3) | the portion of that investment base that is taken from the Strategy to pay for each withdrawal and related Early Withdrawal Charge during the current Term; minus |
4) | the portion of that investment base that is taken from the Strategy to pay for each rider charge during the current Term; and plus |
5) | the Gain or Loss for that Term on the remaining portion of the investment base. |
The portion of the investment base that is taken from the Strategy to pay for a withdrawal or charge is the amount that, when Gain or Loss to the date of the withdrawal or charge is included, equals the withdrawal or charge. If there is a Gain to the date of the withdrawal or charge, then the portion of the investment base taken will be less than the withdrawal or charge. If there is a Loss to the date of the withdrawal or charge, then the portion of the investment base taken will be greater than the withdrawal or charge.
A withdrawal or charge will reduce the value of an Indexed Strategy by an amount equal to the withdrawal or charge. The portion of the investment base taken to pay for a withdrawal or charge is proportional to the reduction in the value of the Indexed Strategy due to the withdrawal or charge.
Purchase Payment Account Value
The Purchase Payment Account holds each Purchase Payment until it is applied to a Crediting Strategy on a Strategy Application Date. The Strategy Application Dates are set out on the Contract Specifications page. Until it is applied to a Crediting Strategy, the value of the Purchase Payment Account is equal to:
1) | Purchase Payments received by us since the last Strategy Application Date; minus |
2) | the premium tax or other tax that may apply to such Purchase Payments; minus |
3) | each withdrawal and related Early Withdrawal Charge taken from the Purchase Payment Account since the last Strategy Application Date; minus |
4) | each rider charge taken from the Purchase Payment Account since the last Strategy Application Date; and plus |
5) | interest earned daily on the Purchase Payment Account value. |
Surrender Value
The Surrender Value of this Contract is the amount that can be taken as a Cash Benefit under this Contract. It is equal to:
1) | the Account Value; minus |
2) | rider charges not previously deducted; and minus |
3) | the Early Withdrawal Charge that would apply on a surrender of this Contract. |
P1833621NW |
9 |
Annuity Payout Value
The Annuity Payout Value is the amount that can be applied to the Annuity Payout Benefit under this Contract. It is equal to:
1) | the Account Value on the Annuity Payout Initiation Date; minus |
2) | rider charges not previously deducted; and minus |
3) | premium tax or other taxes not previously deducted. |
Death Benefit Value
The Death Benefit Value is the amount that is available as a Death Benefit under this Contract. It is equal to the Account Value on the date that the Death Benefit Value is determined.
The Death Benefit Value is reduced by:
1) | rider charges not previously deducted; and |
2) | premium tax or other taxes not previously deducted. |
For this purpose, the date that the Death Benefit Value is determined is the earlier of:
1) | the date that we have received both proof of death and a Request in Good Order with instructions as to the form of Death Benefit; or |
2) | the first anniversary of the date of death. |
INTEREST AND GAIN OR LOSS
Interest and Gain or Loss on Contract Values
Each Strategy is adjusted for Gain or Loss based on the rules that apply to that Strategy. The rules for each Strategy are set out in an endorsement to this Contract.
The Purchase Payment Account earns interest daily at an annual effective rate equal to [1%] per year.
An amount held under this Contract stops earning interest or being adjusted for Gain or Loss after the earliest of:
1) | the Annuity Payout Initiation Date; |
2) | the date that the Death Benefit Value is determined; or |
3) | the date on which the amount is withdrawn or this Contract is surrendered. |
Crediting Strategy
A Crediting Strategy is a specified method by which gain or loss is calculated for a Term. The initial Crediting Strategies are set out on the Contract Specifications page. The maximum gains, participation rates, minimum and maximum allocations, or other variable factors in effect for a given Crediting Strategy may vary from one Term to the next. At the end of a Term, we reserve the right to eliminate a particular Crediting Strategy at our discretion.
Strategy Selections
Each Purchase Payment is applied to the Purchase Payment Account upon receipt by us.
On each Strategy Application Date, we apply the then current balance of the Purchase Payment Account to the Crediting Strategies you have selected. Your selection must be made by a Request in Good Order. The Strategy Application Dates and your initial selection are set out on the Contract Specifications page. Your selection continues to apply until changed by a Request in Good Order.
P1833621NW |
10 |
Strategy Renewals at Term End
At the end of each Term of a given Crediting Strategy, we will apply the ending value of that Strategy to a new Term of that same Strategy except to the extent that such value is moved under the Strategy Reallocation at Term End provision.
Strategy Reallocations at Term End
At the end of a Term, you may reallocate the ending values of the Crediting Strategies for that Term among the available Strategies. A reallocation must be made by Request in Good Order received by us on or before the last day of the Term.
At the end of a Term, we will reallocate any amount that cannot be applied to a given Crediting Strategy for the next Term because that Strategy is no longer available or because the amount is under the minimum or over the maximum for that Strategy. We will make this reallocation to a Strategy that we designate that has a maximum loss of 0%.
You cannot reallocate amounts from one Crediting Strategy to another until the end of the Term for which such amount is being held.
Rules for Strategy Selections and Reallocations
Crediting Strategy selections and reallocations must be in whole percentages. We reserve the right to round amounts up or down to make whole percentages, and to reduce or increase amounts proportionately in order to total 100%.
We reserve the right to establish minimum or maximum amounts or percentages that may be applied to a given Crediting Strategy. We may change these minimums or maximums for any future renewal Terms in our discretion. We will notify you of any such change. We may limit the availability of a Strategy for a Term that would extend beyond the Annuity Payout Initiation Date.
CHARGES
Contract Charge
The Contract Charge is deducted daily from the investment base of each Indexed Strategy. The charge for a given day is calculated as a percentage of the investment base on that day. It compounds to an effective annual rate equal to the Contract Charge Rate set out on the Contract Specifications page.
Early Withdrawal Charge
We will deduct an Early Withdrawal Charge from the Account Value of this Contract if it is surrendered or a withdrawal is taken prior to the sixth Contract Anniversary.
The Early Withdrawal Charge is equal to the Early Withdrawal Charge rate multiplied by the amount that is subject to such charge. The amount that is subject to the charge is the portion of the Account Value that you withdraw or surrender. The amount you withdraw or surrender includes any amount needed to pay the Early Withdrawal Charge itself. It does not include the amount covered by your Free Withdrawal Allowance. The Early Withdrawal Charge rates are set out on the Contract Specifications page.
An Early Withdrawal Charge does not apply to a withdrawal or surrender on or after the sixth Contract Anniversary.
P1833621NW |
11 |
Free Withdrawal Allowance
The Free Withdrawal Allowance is the total amount or amounts that may be taken as a withdrawal or surrender during a Contract Year without an Early Withdrawal Charge that might otherwise apply. For the first Contract Year, it is equal to Free Withdrawal Percentage multiplied by the total Purchase Payments received by us. For each subsequent Contract Year, it is equal to the Free Withdrawal Percentage multiplied by the sum of the Account Value as of the most recent Contract Anniversary plus all Purchase Payments received by us since that Contract Anniversary. The Free Withdrawal Percentage is set out on the Contract Specifications page.
You may not carry over any unused part of your Free Withdrawal Allowance from one Contract Year to the next.
CASH BENEFIT
Surrender
You may surrender this Contract in full at any time before the earlier of:
1) | the Annuity Payout Initiation Date; or |
2) | a death for which a Death Benefit is payable. |
A surrender must be made by a Request in Good Order. In the case of a surrender, this Contract terminates.
The amount paid upon a surrender is the Surrender Value.
Withdrawals
You may take withdrawals from this Contract at any time before the earliest of:
1) | the Annuity Payout Initiation Date; |
2) | a death for which a Death Benefit is payable; or |
3) | the date that this Contract is surrendered. |
A withdrawal must be made by a Request in Good Order. The amount of any withdrawal must be at least $500. No withdrawal may be made if it would reduce the Account Value to less than the Minimum Required Value. The Minimum Required Value is set out on the Contract Specifications page.
A withdrawal will be taken:
1) | first proportionally from funds that then qualify for a waiver of the Early Withdrawal Charge pursuant to the provisions of the Crediting Strategy endorsement; |
2) | then from the Purchase Payment Account; and |
3) | then proportionally from Indexed Strategies having the shortest Term. |
Exchanges, Transfers, and Rollovers
An amount paid on a withdrawal or surrender may be paid to or for another annuity or tax-qualified account in a tax-free exchange, transfer, or rollover to the full extent allowed by federal tax law.
P1833621NW |
12 |
ANNUITY PAYOUT BENEFIT
Annuity Payout Benefit
The Annuity Payout Benefit is a series of periodic payments made under a Payout Option. The Annuity Payout Benefit is payable under this Contract if the Annuity Payout Initiation Date is reached before the earlier of:
1) | a death for which a Death Benefit is payable; or |
2) | the date that this Contract is surrendered. |
Once the Annuity Payout Initiation Date is reached:
1) | the Annuity Payout Benefit is in place of all other benefits under this Contract; and |
2) | all other rights under this Contract terminate except for rights related to the Annuity Payout Benefit. |
Annuity Payout Amount
The amount of each payment under the Annuity Payout Benefit is determined on the Annuity Payout Initiation Date based on:
1) | the Annuity Payout Value on that date; |
2) | the Payout Option that applies; and |
3) | the payment interval. |
Annuity Payout Initiation Date
The Annuity Payout Initiation Date is the first day of the first payment interval for which payment of the Annuity Payout Benefit is to be made. Payments under a Payout Option are made at the end of each payment interval. This means that for annual payments, the first payment will be made one year after the Annuity Payout Initiation Date.
You may choose the Annuity Payout Initiation Date by a Request in Good Order. Such a request must be received by us no later than the chosen date, and at least 30 days before the date of the first payment to be made under a Payout Option.
The earliest permitted date that you may choose is the first Contract Anniversary. Unless we agree, the latest permitted date that you may choose is the Contract Anniversary following your 95th birthday or the 95th birthday of a joint owner. The earliest and latest permitted dates, as determined on the Contract Effective Date, are set out on the Contract Specifications page.
If you have not chosen the Annuity Payout Initiation Date by the latest permitted date, we may choose it for you. We will notify you in writing at least 45 days before the date we choose, and give you an opportunity to choose an earlier date.
P1833621NW |
13 |
Form of Annuity Payout Benefit
The Annuity Payout Benefit is paid in the form of annual payments as a Life Payout with Payments for at Least a Fixed Period as described in the PAYOUT OPTIONS section of this Contract, with a fixed period of 10 years, or if fewer, the maximum number of whole years permitted by any tax qualification endorsement.
In place of that, you may choose to have the Annuity Payout Benefit paid in the form of any other Payout Option that is available to you under this Contract. Your choice must be made by a Request in Good Order that is received by us no later than the Annuity Payout Initiation Date and at least 30 days before the date of the first payment to be made.
Each Payout Option that is contingent on life is based on the life of the Annuitant.
We will not pay an Annuity Payout Benefit if we have the right to terminate this Contract pursuant to the Termination provision.
Payee for Annuity Payout Benefit
Payments of the Annuity Payout Benefit are paid to the surviving Owner(s). In place of receiving such payments, the surviving Owner(s) may from time to time elect for payments of the Annuity Payout Benefit be made:
1) | as a tax-free exchange, transfer, or rollover to or for an annuity or tax-qualified account as permitted by federal tax law; or |
2) | to the Annuitant. |
That election must be made or changed by a Request in Good Order received at least 30 days before the date of payment.
Annuity Payout Benefit payments that become due after the death of the payee are made to:
1) | the surviving Owner(s); or if none |
2) | then to the surviving contingent payee(s) designated by the surviving Owner(s); or if none |
3) | the estate of the last payee who received payments. |
A designation or change of a contingent payee must be made or changed by a Request in Good Order. If you designate your spouse as a contingent payee and your marriage ends before your death, then we will treat your former spouse as having predeceased you except:
1) | to the extent a court order provides that the former spouses rights as a contingent payee are to continue; or |
2) | to the extent he or she remains or becomes an Owner. |
The portion of the Annuity Payout Benefit, if any, remaining after the death of an Owner or Annuitant must be paid at least as rapidly as payments were being made at the time of such death.
P1833621NW |
14 |
DEATH BENEFIT
Death Benefit
A Death Benefit is payable under this Contract if, before the Annuity Payout Initiation Date and before the date that this Contract is surrendered:
1) | an Owner dies; or |
2) | an Annuitant dies when this Contract is owned by a trust, custodial account, corporation, limited liability company, partnership, or other entity. |
No Death Benefit will be payable on your death if your spouse becomes successor owner of this Contract.
If a Death Benefit becomes payable:
1) | it is in place of all other benefits under this Contract; and |
2) | all other rights under this Contract terminate except for rights related to the Death Benefit. |
Only one Death Benefit can be paid under this Contract.
Death Benefit Amount
If the Death Benefit is to be paid as a series of periodic payments under a Payout Option, then the amount of each payment under the Death Benefit is determined on the date that the Death Benefit Value is applied to the Payout Option and is based on:
1) | the Death Benefit Value, together with any interest required by law to the date it is applied to the Payout Option; |
2) | the Payout Option that applies; and |
3) | the payment interval. |
If the Death Benefit is paid in a lump sum, then it is equal to the Death Benefit Value increased by interest as required by law.
Interest on Death Benefit
We will accrue interest on the Death Benefit payable under this Contract as required by law. Such interest, if any, is added to the Death Benefit Value to be paid.
Death Benefit Payout Date
If the Death Benefit is to be paid under a Payout Option, then we will we apply the Death Benefit Value to a Payout Option as soon as practical after receipt of due proof of death and a Request in Good Order. The date that we do so will be the first day of the first payment interval for which a payment is to be made. Payments under a Payout Option are made at the end of each payment interval. This means that for annual payments, the first payment will be made one year after the date on which the Death Benefit is applied to a Payout Option.
If the Death Benefit is to be paid as a lump sum, then it will be paid as soon as practical after the receipt of the Request in Good Order for a lump sum payment.
P1833621NW |
15 |
Form of Death Benefit
Death Benefit payments are made annually as a Fixed Period Payout as described in the PAYOUT OPTIONS section of this Contract, with a period certain of two years.
In place of that, you may choose to have Death Benefit payments paid as a lump sum or in the form of any Payout Option that is available under this Contract. Your choice must be made by a Request in Good Order that is received by us on or before the date of death for which a Death Benefit is payable.
If you do not make such a choice, the Beneficiary may make that choice after the date of death. His or her choice must be made by a Request in Good Order that is received by us no later than the date that the Death Benefit Value is applied to a Payout Option and at least 30 days before the date of the first payment to be made.
Any choice is subject to the Death Benefit Distribution Rules provision of this Contract.
In any event, a Payout Option that is contingent on life is based on the life of the Beneficiary. A Beneficiary that is a trust, custodial account, corporation, limited liability company, partnership, or other entity may elect a Payout Option based on the life of a person to whom the Beneficiary is obligated. Such an election must be made by a Request in Good Order at least 30 days before the date of payment.
We will pay the Death Benefit as a lump sum rather than as payments under a Payout Option if:
1) | as of the date that the Death Benefit Value is to be applied to a Payout Option, the Death Benefit Distribution Rules provision of this Contract does not allow a two-year payout; or |
2) | the Death Benefit is less than $2,000. |
Death Benefit Distribution Rules
The Death Benefit must be paid in accordance with the tax qualification endorsement, if any. If the cover page states that this Contract is a Nonqualified Annuity, then the Death Benefit must be paid either:
1) | in full within five years of the date of death; or |
2) | over the life of the Beneficiary or over a period certain not exceeding his or her life expectancy, with payments at least annually and with the first payment made within one year of the date of death. |
If the cover page states that this Contract is a Nonqualified Annuity, and your spouse (as defined by federal tax law) becomes the successor owner of this Contract after your death, then:
1) | this rule does not apply to your death; and |
2) | if the successor owner dies before the Annuity Payout Initiation Date, this rule applies to the death of the successor owner. |
Payee for Death Benefit Payments
Death Benefit payments are made to the Beneficiary as the payee unless:
1) | amounts are paid as a tax-free exchange, transfer, or rollover to or for an annuity or tax-qualified account as permitted by federal tax law; or |
2) | the Beneficiary is a trust, custodial account, corporation, limited liability company, partnership, or other entity, and elects to have Death Benefit payments made to a person to whom the Beneficiary is obligated to make corresponding payments. |
P1833621NW |
16 |
Death Benefit payments that become due after the death of the payee are made to the contingent payee designated as part of any Payout Option election made by you for the Death Benefit. If there is no such contingent payee surviving, then such payments are made to the contingent payee designated by the Beneficiary. Failing that, such payments are made to the estate of the last payee who received payments.
If the Beneficiary designates his or her spouse as the contingent payee and their marriage ends before the Beneficiarys death, then we will treat the former spouse as having predeceased the Beneficiary except to the extent a court order provides that the rights of the former spouse as contingent payee are to continue.
A designation or change of a payee or contingent payee must be made by a Request in Good Order. A Beneficiary may not change a contingent payee designation made as part of a Payout Option election made by you for the Death Benefit. A Beneficiary may make or change any other payee or contingent payee designation at any time.
PAYOUT OPTIONS
Conditions
Payments under a Payout Option are subject to any minimum amounts, payment intervals, and other rules and conditions that we may from time to time require. If we change our minimums, we may change any current or future payment amounts and/or payment intervals to conform to the change. Payments under a Payout Option are made at the end of a payment interval. Once payment begins under a Payout Option, the Payout Option may not be changed.
All elected Payout Options must comply with pertinent laws and governmental regulations and rulings.
If more than one person is the payee under a Payout Option, payments are made to the payees jointly. No more than two persons may be initial payees under a joint and survivor Payout Option.
If payment under a Payout Option depends on whether a specified person is still alive, we may at any time require proof that such person is still living. We will require proof of the age of any person on whose life payments are based.
Nonhuman Payees under a Payout Option
Except as stated in this provision, the primary payee under a Payout Option must be a human being. All payments under a Payout Option during his or her life must be made by check payable to the primary payee or by electronic transfer to a checking or savings account owned by the primary payee. Payments may be made as a tax-free exchange, transfer, or rollover to or for another annuity or tax-qualified account to the full extent allowed by federal tax law. An Owner that is a trust, corporation, limited liability company, partnership, or other entity may be the primary payee for an Annuity Payout Benefit. A Beneficiary that is a trust, corporation, limited liability company, partnership, or other entity may be the primary payee for a Death Benefit. We may make other exceptions in our discretion.
Limitation on Election of Payout Option
A fixed period of less than the Minimum Fixed Period Payout is available only for a Death Benefit. The Minimum Fixed Period Payout is set out on the Contract Specifications page.
Payout Option Computations
The 2012 Individual Annuity Mortality Period Table with projection scale G2 for blended lives (60% female/40% male) with interest at [1%] per year, compounded annually, is used to compute all guaranteed Payout Option factors, values, and benefits under this Contract. For purposes of calculating payments based on the age of a person, we will use the persons age as of his or her last birthday.
P1833621NW |
17 |
Available Payout Options
The available Payout Options are set out below.
Fixed Period Payout: We will make periodic payments for a fixed period. The first payment is paid as of the last day of the initial payment interval. The fixed period may not be longer than 30 years. The Fixed Period Payout Table applies to this Option.
Life Payout: We will make periodic payments until the death of the person on whose life payments are based. The first payment is paid as of the last day of the initial payment interval. Upon request, we will provide information on the payouts that we will make based on the age of the person on whose life payments are based, the payment interval, and the year in which the Contract Value is applied to the Payout Option.
Life Payout with Payments for at Least a Fixed Period: We will make periodic payments until the death of the person on whose life payments are based. We guarantee that such payments continue for at least a fixed period you select even if the person should die before the end of that fixed period. The first payment is paid as of the last day of the initial payment interval. Upon request, we will provide information on the payments that we will make based on the age of the person on whose life payments are based, the fixed period, the payment interval, and the year in which the Contract value is applied to the Payout Option.
Joint and One-half Survivor Payout: We will make periodic payments until the death of the primary person on whose life payments are based; thereafter, we will make one-half of the periodic payment until the death of the secondary person on whose life payments are based. The first payment is paid as of the last day of the initial payment interval. Upon request, we will provide information on the payments that we will make based on the ages of the persons on whose lives payments are based, the payment interval, and the year in which the Contract value is applied to the Payout Option.
We will make periodic payments in any other form of Payout Option that is acceptable to us at the time of an election.
Commuted Values
Once the Contract value is applied to a Payout Option, the periodic payments cannot be accelerated or converted into a lump sum payment unless we agree.
P1833621NW |
18 |
Fixed Period Payout Table
The Fixed Period Payout Table shows the payments that we will make at sample payment intervals for each $1,000 applied based on the guaranteed Payout Option factors.
Payments for fixed number of years for each $1,000 applied.
Annual | Semi Annual |
Quarterly | Monthly | |||||||||||||
Years | ||||||||||||||||
1 |
[$ | 1,010.00 | $ | 503.74 | $ | 251.55 | $ | 83.78 | ||||||||
2 |
507.51 | 253.12 | 126.40 | 42.10 | ||||||||||||
3 |
340.02 | 169.58 | 84.68 | 28.20 | ||||||||||||
4 |
256.28 | 127.82 | 63.83 | 21.25 | ||||||||||||
5 |
206.03 | 102.76 | 51.31 | 17.09 | ||||||||||||
6 |
172.54 | 86.05 | 42.97 | 14.31 | ||||||||||||
7 |
148.62 | 74.12 | 37.01 | 12.32 | ||||||||||||
8 |
130.69 | 65.18 | 32.55 | 10.84 | ||||||||||||
9 |
116.74 | 58.22 | 29.07 | 9.68 | ||||||||||||
10 |
105.58 | 52.65 | 26.29 | 8.75 | ||||||||||||
11 |
96.45 | 48.10 | 24.02 | 8.00 | ||||||||||||
12 |
88.84 | 44.31 | 22.12 | 7.37 | ||||||||||||
13 |
82.41 | 41.10 | 20.52 | 6.83 | ||||||||||||
14 |
76.90 | 38.35 | 19.15 | 6.37 | ||||||||||||
15 |
72.12 | 35.97 | 17.96 | 5.98 | ||||||||||||
16 |
67.94 | 33.88 | 16.92 | 5.63 | ||||||||||||
17 |
64.25 | 32.04 | 16.00 | 5.33 | ||||||||||||
18 |
60.98 | 30.41 | 15.18 | 5.05 | ||||||||||||
19 |
58.05 | 28.95 | 14.45 | 4.81 | ||||||||||||
20 |
55.41 | 27.63 | 13.80 | 4.59 | ] |
The values stated for fixed periods shorter than the Minimum Fixed Period Payout are available only as a Death Benefit option. The Minimum Fixed Period Payout is set out on the Contract Specifications page.
GENERAL PROVISIONS
Entire Contract
This Contract, any application for it, any endorsements to it, and any riders and rider applications, form the entire contract between you and us.
Only statements that you have made in consideration for this Contract or a rider may be used to defend a claim based on it, or to void this Contract or a rider. Such statements are treated as representations and not warranties.
Changes Waivers
No changes or waivers of the provisions of this Contract are valid unless made in writing and are signed by our President, Vice President, or Secretary. No other person or producer has authority to change or waive any provision of this Contract. We reserve the right, in our sole discretion, to administer and change the provisions of this Contract to obtain or retain the intended tax treatment under federal tax law, or to take into account other pertinent laws and governmental regulations and rulings.
P1833621NW |
19 |
Misstatement
If the age of a person is misstated, we will adjust payments to the amount that would have been payable based on the correct age. If payments based on the correct age would have been higher, we will promptly pay the underpaid amount in one sum, with interest. If payments based on the correct age would have been lower, we may deduct the overpaid amount, with interest, from succeeding payments. We may also pursue other remedies at law or in equity. The interest to be paid or charged is the rate that was used to calculate the payments, but not to exceed 6% per year.
Required Reports
At least once each Contract Year, we will send you a report of your current values. We will also provide any other information required by law. These reports will stop on the earliest of the following dates:
1) | the Annuity Payout Initiation Date; |
2) | the date that the Death Benefit Value is determined; or |
3) | the date that this Contract is surrendered. |
The reports will be mailed to your last known address. If permitted by law, in place of that we may deliver these and other required documents in electronic form. The reported values will be based on the information in our possession at the time that we prepare the report. We may adjust the reported values at a later date if that information proves to be incorrect or has changed.
Exclusive Benefit
Your rights as Owner of this Contract are for the exclusive benefit of you and your Beneficiaries. Your rights as Owner of this Contract are not forfeitable by us.
State Law
All factors, values, benefits, and reserves under this Contract shall not be less than those required by the law of the state in which this Contract is delivered.
Claims of Creditors
To the extent allowed by law, your rights as Owner of this Contract and all values and benefits under it are not subject to the claims of creditors or to legal process.
Company Liability
We will not be liable for any loss that is related to a failure by you, or by any other person having rights or benefits under this Contract, to comply with pertinent laws or governmental regulations or rulings.
Incontestability
This Contract is not contestable by us, except to the extent stated in an application, endorsement, or rider, if any.
Discharge of Liability
We will be discharged from all liability to the extent of each payment that is made for a Cash Benefit, Annuity Payout Benefit, Death Benefit, or rider benefit.
Transfer by the Company
We reserve the right to transfer our obligations under this Contract to another qualified life insurance company under an assumption or reinsurance arrangement. We may make such a transfer without your consent.
Taxes
Some states impose on the Company a premium tax or other taxes on annuities. If a premium tax or other tax is charged or due, we reserve the right to deduct this amount from the Purchase Payment or Account Value at the time that it is imposed.
P1833621NW |
20 |
Proof of Death
Before making payment of a Death Benefit, or any other payment or transfer of ownership rights that depends on the death of a specified person, we will require proof of death. We may delay making any payment until it is received. For this purpose, proof of death is:
1) | a certified copy of a death certificate showing the cause and manner of death; |
2) | a certified copy of a decree that is made by a court of competent jurisdiction as to the finding of death; or |
3) | other proof that is satisfactory to us. |
Loans
A loan is not available under this Contract.
Termination
We reserve the right to terminate this Contract at any time that the Account Value is less than the Minimum Required Value. The Minimum Required Value is set out on the Contract Specifications page. If we terminate this Contract for this reason, we will pay you the Surrender Value. We will not terminate this Contract at a time when a distribution to you is prohibited by a tax qualification endorsement.
Deferral of Payment
We reserve the right to delay payment of a surrender or withdrawal after we receive your Request in Good Order for it. We may delay such payment for up to six months upon receipt of written approval from the commissioner of insurance of the state in which this Contract was issued.
Escheat of Payment
If an Annuity Payout Benefit or Death Benefit is due to be paid, and we cannot find the payee or there is a dispute over the payment that is not resolved, we will escheat the amount due as required by law. In the case of an Annuity Payout Benefit, we will escheat payments as they become due. In the case of a Death Benefit, we will escheat the Death Benefit as a lump sum on the date that state law requires that it be escheated.
Change of Administrative Office
If we change our Administrative Office, we will notify you in writing.
Separate Account
We hold reserves to support our guarantees under the Indexed Strategies of this Contract in a non-unitized Separate Account. The Separate Account is established and maintained pursuant to the laws of our domiciliary state. The assets in the Separate Account shall not be chargeable with liabilities arising out of any other business that we conduct. General account assets are also available to meet guarantees under this Contract as well as our other general obligations.
P1833621NW |
21 |
Changes in Indices
This Contract has one or more Crediting Strategies that calculate interest based in whole or in part on an index, a market interest rate, or the price or unit value of an investment fund or commodity.
We reserve the right to replace an index or an interest rate if it stops being published, or if an investment fund terminates, or if an investment fund or a commodity stops being traded on a specified market, then we will select a similar index, interest rate, investment fund, commodity, or market to replace it. If the publication schedule of an index or interest rate is changed, or if the calculation of it is changed significantly, if there is a significant change in the investment objectives, strategies, or operations of an investment fund, or if a specified market declines in importance, then:
1) | we may replace it with a similar index, interest rate, investment fund, commodity, or market; or |
2) | we may make adjustments to it to approximate its performance before the change. |
The new or adjusted index, interest rate, investment fund, commodity, or market will not be exactly the same as the original, but it will correspond reasonably to it, as determined by us in good faith. The new or adjusted index, interest rate, investment fund, commodity, or market will apply until it is replaced or adjusted, or until the particular Crediting Strategy is eliminated. If required, we will get approval from the insurance department of the state where this Contract was issued before we make a replacement or adjustment.
P1833621NW |
22 |
MASSMUTUAL ASCEND LIFE INSURANCE COMPANY
[Marketing Name]
Individual Deferred Variable Annuity Contract
[Tax Qualification]
Indexed Rate Crediting Strategies
Flexible Purchase Payments for Limited Period
NonparticipatingNo Dividends
P1833621NW |
(Rev. 10/22) |
Exhibit 4(b)(1)
[ ]
Home Office: Cincinnati, Ohio
Administrative Office: [P.O. Box 5420, Cincinnati, Ohio 45201-5420]
INHERITED CONTRACT ENDORSEMENT
The annuity contract is changed as set out below for use as an inherited contract.
Inherited Contract
This annuity contract is intended to be an inherited annuity contract. It is established for the purpose of receiving funds from a deferred annuity contract that was owned by an individual who is now deceased (the Decedent). The Decedent is identified with the name of the Owner of this annuity contract.
Decedent Information
We may require you to provide Due Proof of Death for the Decedent. We may require you to provide such other information about the Decedent and the prior annuity contract as needed to administer this annuity contract.
Purchase Payments Limited
Any purchase payment for this annuity contract must be received as part of a tax-free exchange under IRC Section 1035. It must be funds from an annuity contract that was owned by the Decedent. It must be funds for which the Owner is the designated beneficiary under the terms of that contract. The Decedent must have died before the annuity starting date of that contract. The annuity starting date is the first day of the first period for which an annuity payment would have been made under that contract.
No other purchase payments may be made to this contract.
Required Distributions
The entire interest in this annuity contract will be paid at least as rapidly as required by IRC Section 72(s) and the related regulations either:
1) | over your life or over a period certain not exceeding your life expectancy, with payments at least annually starting within one (1) year of the Decedents date of death or such later date as may be permitted by such regulations; or |
2) in full within five (5) years of the Decedents date of death.
This is part of your annuity contract. It is not a separate contract. It changes the annuity contract only as and to the extent stated. In all cases of conflict with the other terms of the annuity contract, the provisions of this Endorsement shall control.
Signed for us at our office as of the date of issue.
E1091612NW |
-1- | (Rev. 10/22) |
[ ] | [ ] | |
[MARK F. MUETHING] | [JOHN P. GRUBER] | |
[PRESIDENT] | [SECRETARY] |
E1091612NW |
-2- |
Exhibit 4(b)(2)
[ ]
Home Office: Cincinnati, Ohio
Administrative Office: [P.O. Box 5420, Cincinnati, Ohio 45201-5420]
INDIVIDUAL RETIREMENT ANNUITY ENDORSEMENT
The annuity contract (the Contract) is changed by this Individual Retirement Annuity Endorsement (this Endorsement) to add the following additional provisions:
Applicable Tax Law Restrictions
The Contract is intended to receive contributions that qualify for deferred tax treatment under Internal Revenue Code (IRC) Section 408(b). It is restricted as required by federal tax law. We may change the terms of the Contract or administer it at any time as needed to comply with that law. Any such change may be applied retroactively to the extent permitted by law.
Exclusive Benefit
The Contract is established for the exclusive benefit of you and your beneficiaries. Your interest in the Contract is nonforfeitable.
Nonparticipating
The Contract does not pay dividends or share in our surplus.
No Assignment or Transfer
You cannot assign, sell, or transfer your interest in the Contract. You cannot pledge it to secure a loan or the performance of an obligation, or for any other purpose. The only exceptions to these rules are:
1) | all or part of your interest in the Contract may be transferred to your spouse or former spouse (as defined by federal law) under a divorce or separation instrument described in IRC Section 71(b)(2)(A); and |
2) | payments from the Contract may be based on joint lives or joint life expectancies of you and another person, but such other person shall have no present rights under the Contract during your lifetime. |
E6004010NW |
(Rev. 10/22) |
Contributions
The Contract does not require fixed contributions or other premiums or purchase payments, but we may decline to accept any premium or purchase payment of less than $50. The Contract will not lapse if you do not make premiums or purchase payments. We may terminate the Contract pursuant to any involuntary surrender or termination provision of the Contract only if premiums or purchase payments have not been made for at least two full Contract years and the value of the Contract (increased by any guaranteed interest) would provide a benefit on the Annuity Commencement Date, maturity date, or annuity date of less than $20 a month under the standard form of payment.
All contributions to us must be made in cash BY CHECK OR MONEY ORDER MADE PAYABLE TO US.
Total contributions made to the Contract with respect to any single tax year may not exceed the annual contribution limit, excluding any payment that is:
1) | allowed as a rollover contribution under IRC Section 402(c), 402(e)(6), 403(a)(4), 403(b)(8), 403(b)(10), 408(d)(3), or 457(e)(16); |
2) | a contribution made in accordance with the terms of a Simplified Employee Pension (SEP) described in IRC Section 408(k); or |
3) | an additional contribution specifically authorized by statute, such as repayments of qualified reservist distributions, repayments of certain plan distributions made on account of a federally declared disaster, certain amounts received in connection with the Exxon Valdez litigation, and contributions for taxable years beginning after 2006 and before 2010 by an individual who was a participant in a 401(k) plan of a certain employer in bankruptcy described in IRC Section 219(b)(5)(C). |
The annual contribution limit is $5,000 for any tax year beginning in 2008 and years thereafter. After 2008, the annual contribution limit will be adjusted by the Secretary of the Treasury for cost-of-living increases under IRC Section 219(b)(5)(C). Such adjustments will be in multiples of $500.
If you are age 50 or older, the annual contribution limit is increased by $1,000 for any tax year beginning in 2006 and years thereafter.
The Contract will not accept contributions made by an employer through a SIMPLE IRA plan under IRC Section 408(p). The Contract will not accept a transfer or rollover of any funds attributable to contributions made by an employer through a SIMPLE IRA plan until at least two years after the date you first participated in that employers SIMPLE IRA plan.
The Contract will not accept a rollover contribution to an Inherited IRA for a nonspouse beneficiary under IRC Section 402(c)(11), 403(a)(4)(B), 403(b)(8)(B), or 457(e)(16)(B). The Contract will not accept a transfer from an Inherited IRA within the meaning of IRC Section 408(d)(3)(C).
E6004010NW |
-2- |
Annual Report
We will furnish annual calendar year reports concerning the status of the Contract and such information concerning required minimum distributions as is prescribed by the Commissioner of Internal Revenue.
Required Minimum Distributions During Life
Distributions from the Contract shall be made in accordance with the requirements of IRC Section 408(b)(3) and the regulations thereunder. If distributions are not made in the form of an annuity on an irrevocable basis (except for acceleration), then distribution of your entire interest in the Contract must satisfy the requirements of IRC Section 408(a)(6) and the regulations thereunder instead of the requirements set out herein.
The Required Beginning Date for distributions from the Contract is April 1 following the calendar year in which you reach age 70-1/2. No later than the Required Beginning Date, your entire interest in the Contract must begin to be distributed over (i) your life or the lives of you and your designated beneficiary, or (ii) a period certain not to exceed your life expectancy or the joint and last survivor expectancy of you and your designated beneficiary. Payments must be made in periodic payments at intervals of no longer than one (1) year, and must be either nonincreasing or they may increase only as provided in Q&A-1 and Q&A-4 of Section 1.401(a)(9)-6 of the Income Tax Regulations. In addition, any distribution must satisfy the incidental benefit requirements specified in Q&A-2 of Section 1.401(a)(9)-6 of the Income Tax Regulations.
The distribution periods described above cannot exceed the periods specified in Section 1.401(a)(9)-6 of the Income Tax Regulations. The first required payment can be made as late as the Required Beginning Date and must be the payment that is required for a single payment interval. The second payment need not be made until the end of the next payment interval.
Your entire interest in the Contract includes the amount of any outstanding rollover, transfer, or recharacterization under Q&A-7 or Q&A-8 of Section 1.408-8 of the Income Tax Regulations, and the actuarial value of any other benefits provided under the Contract, such as guaranteed death benefits, to the extent required by regulations.
Required Minimum Distributions After Death
If you die after required distributions begin, the remaining portion of your interest in the Contract will continue to be distributed under the Contract option chosen.
If you die before required distributions begin, your entire interest in the Contract will be distributed as least as rapidly as follows:
1) | If your designated beneficiary is not your surviving spouse (as defined by federal tax law), then your entire interest in the Contract must be distributed over the remaining life expectancy of the designated beneficiary, with payments starting by the end of the calendar year following the calendar year of your death. The life expectancy of the designated beneficiary is determined using his or her age as of his or her birthday in the year following the year of your death. Alternatively, if elected, your entire interest in the Contract must be distributed by the end of the calendar year that contains the fifth anniversary of your death. |
E6004010NW |
-3- |
2) | If your sole designated beneficiary is your surviving spouse (as defined by federal tax law), then your entire interest in the Contract must be distributed over your spouses life expectancy, with payments starting by the end of the calendar year following the calendar year of your death, or if later, by the end of the calendar year in which you would have reached age 70-1/2. Alternatively, if elected, your entire interest in the Contract must be distributed by the end of the calendar year that contains the fifth anniversary of your death. |
If your surviving spouse dies before required distributions begin to him or her, then the remaining interest will be distributed over the remaining life expectancy of your spouses designated beneficiary, with payments starting by the end of the calendar year following the calendar year of your spouses death. The life expectancy of your spouses designated beneficiary will be determined using his or her age as of his or her birthday in the year following the death of your spouse. Alternatively, if elected, or if your surviving spouse dies and there is no designated beneficiary, then the remaining interest in the Contract will be distributed by the end of the calendar year that contains the fifth anniversary of your surviving spouses death.
If your surviving spouse dies after required distributions begin to him or her, then any remaining interest will continue to be distributed under the Contract option chosen.
3) | If there is no designated beneficiary, then your entire interest in the Contract will be distributed by the end of the calendar year containing the fifth anniversary of your death. |
Life expectancy is determined using the Single Life Table in Q&A-1 of Section 1.401(a)(9)-9 of the Income Tax Regulations. If distributions are being made to your surviving spouse as your sole designated beneficiary, your spouses remaining life expectancy for a year is the number in the Single Life Table corresponding to such spouses age on his or her birthday in the year. In all other cases, remaining life expectancy for a year is the number in the Single Life Table in the year such individuals life expectancy is first determined, reduced by one (1) for each subsequent year.
Required distributions are considered to begin on your Required Beginning Date or, if applicable, on the date distributions are required to begin to your surviving spouse. However, if distributions under the Contract start prior to such date on an irrevocable basis (except for acceleration) in a form meeting the requirements of Section 1.401(a)(9)-6 of the Income Tax Regulations, then required distributions are considered to begin on the annuity starting date.
Your entire interest in the Contract includes the amount of any outstanding rollover, transfer, or recharacterization under Q&A-7 or Q&A-8 of Section 1.408-8 of the Income Tax Regulations, and the actuarial value of any other benefits provided under the Contract, such as guaranteed death benefits, to the extent required by regulations.
For purposes of this provision, a designated beneficiary is an individual designated under the Contract to receive payments after your death (or the death of your surviving spouse) and who qualifies as a designated beneficiary under Section 1.401(a)(9)-4 of the Income Tax Regulations.
E6004010NW |
-4- |
If your sole designated beneficiary is your surviving spouse (as defined by federal tax law), then your spouse may elect to treat the Contract as his or her own IRA. This election will be deemed to have been made if he or she becomes Successor Owner of the Contract or fails to take required distributions from the Contract as a beneficiary. No contribution, rollover, or transfer to the Contract may be made after your death unless your spouse (as defined by federal tax law) becomes Successor Owner.
This Endorsement is part of the Contract. It is not a separate contract. It changes the Contract only as and to the extent stated. It supersedes all prior Individual Retirement Annuity endorsements. In all cases of conflict with the other terms of the Contract, the provisions of this Endorsement shall control.
Signed for us at our office as of the date of issue.
[ ] | [ ] | |
[MARK F. MUETHING] | [JOHN P. GRUBER] | |
[PRESIDENT] | [SECRETARY] |
E6004010NW |
-5- |
Exhibit 4(b)(3)
[ ]
Home Office: Cincinnati, Ohio
Fixed Administrative Office: [P.O. Box 5420, Cincinnati, Ohio 45201-5420]
ROTH
INDIVIDUAL RETIREMENT ANNUITY
ENDORSEMENT
The annuity contract (Contract) is changed by this Roth Individual Retirement Annuity Endorsement (this Endorsement) to add the following additional provisions:
APPLICABLE TAX LAW RESTRICTIONS. This Contract is intended to receive contributions that qualify for special tax treatment under Internal Revenue Code (IRC) Section 408A. It is restricted as required by federal tax law. We may change the terms of this Contract or administer this Contract at any time as needed to comply with that law. Any such change may be applied retroactively.
EXCLUSIVE BENEFIT. This Contract is established for the exclusive benefit of you and your beneficiaries. Your interest in this Contract is nonforfeitable.
NON-PARTICIPATING. This Contract does not pay dividends or share in our surplus.
NO ASSIGNMENT OR TRANSFER. You cannot assign, sell, or transfer your interest in this Contract. You cannot pledge it to secure a loan or the performance of an obligation, or for any other purpose. The only exceptions to these rules are:
1) | All or part of your interest in this Contract may be transferred to a spouse or former spouse (as defined by federal tax law) under a divorce or separation instrument described in IRC Section 71(b)(2)(A); and |
2) | payments from this Contract may be based on the joint lives or joint life expectancies of you and another person, but such other person will have no present rights in this Contract during your lifetime. |
CONTRIBUTIONS. This Contract does not require fixed premiums, purchase payments, or other contributions, but we may decline to accept any contribution of less than $50. This Contract will not lapse if you do not make contributions. This Contract will remain subject to cancellation under any involuntary surrender or termination provision of this Contract; provided, however, that in no event shall any such cancellation occur unless, at a minimum, contributions have not been made for at least two (2) full contract years and the value of this Contract (increased by any guaranteed interest) would provide a benefit at its stated maturity date of less than $20 a month under the regular settlement option.
All contributions to us must be made in cash BY CHECK OR MONEY ORDER MADE PAYABLE TO US.
E6004108NW |
-1- | (Rev. 10/22) |
Total contributions made to this Contract with respect to any single tax year, excluding any payment that is allowed as a qualified rollover contribution, may not exceed the amount determined under the Regular Contribution Limit provision of this Endorsement. A qualified rollover contribution is a rollover contribution of a distribution from an IRA that is allowed under the Rollover Contribution Limit provision of this Endorsement and that meets the requirements of IRC Section 408(d)(3), except that the one-rollover-per-year rule of Section 408(d)(3)(B) does not apply if the rollover is from an IRA other than a Roth IRA. A qualified rollover contribution also includes a rollover from a designated Roth account described in IRC Section 402A. For taxable years beginning after 2007, a qualified rollover contribution also includes a rollover contribution from an eligible retirement plan described in IRC Section 402(c)(8)(B) that is allowed under the Rollover Contribution Limit provision of this Endorsement.
Subject to the Regular Contribution Limits provision of this Endorsement, a regular contribution to an IRA other than a Roth IRA may be recharacterized as a regular contribution to this Contract pursuant to the rules of Section 1.408A-5 of the Income Tax Regulations.
This Contract will not accept contributions made by an employer through a SIMPLE IRA plan under IRC Section 408(p). This Contract will not accept a transfer or rollover of any funds attributable to contributions made by an employer through a SIMPLE IRA plan until at least two (2) years after the date you first participated in that employers SIMPLE IRA plan.
REGULAR CONTRIBUTION LIMIT. The regular contributions for any tax year may not exceed the least of:
1) | the annual contribution limit (including any increase applicable if you are age 50 or older or any increase for a participant in an IRC Section 401(k) plan of a bankrupt employer), less any reduction that may apply based on your modified adjusted gross income; |
2) | the annual contribution limit (including any increase applicable if you are age 50 or older or any increase for a participant in an IRC Section 401(k) plan of a bankrupt employer), less any regular contributions for that same year that you make to an IRA other than a Roth IRA; or |
3) | your compensation for the year. |
The annual contribution limit is:
1) | $3,000 for any tax year beginning in 2002 through 2004; |
2) | $4,000 for any tax year beginning in 2005 through 2007; and |
3) | $5,000 for any tax year beginning in 2008 and years thereafter. |
After 2008, the $5,000 annual contribution limit will be adjusted by the Secretary of the Treasury for cost-of-living increases under IRC Section 219(b)(5)(D). Such adjustments will be in multiples of $500.
If you are age 50 or older, the annual contribution limit is increased by:
1) | $500 for any tax year beginning in 2002 through 2005; and |
2) | $1,000 for any tax year beginning in 2006 and years thereafter. |
If you were a participant in an IRC Section 401(k) plan of an employer in bankruptcy meeting certain requirements described in IRC Section 219(b)(5)(C), then the annual contribution limit is increased by $3,000 for taxable years beginning in 2007 through 2009. You may not use the increased contribution limit under this paragraph in a year that you also use the increased contribution limit for an individual who is age 50 or older.
E6004108NW |
-2- |
The annual contribution limit (including any increase if you are age 50 or older or any increase for a participant in an IRC Section 401(k) plan of a bankrupt employer) is reduced ratably between certain levels of modified adjusted gross income as follows:
1) | if you are single or a head of household, the annual contribution limit is reduced ratably for modified adjusted gross income between $95,000 and $110,000, and the annual contribution limit is zero (0) if your modified adjusted gross income is $110,000 or more; |
2) | if you are married and file a joint return or you are a qualified widow(er), the annual contribution limit is reduced ratably for modified adjusted gross income between $150,000 and $160,000, and the annual contribution limit is zero (0) if your modified adjusted gross income is $160,000 or more; and |
3) | if you are married and file a separate return, the annual contribution limit is reduced ratably for modified adjusted gross income between $0 and $10,000, and the annual contribution limit is zero (0) if your modified adjusted gross income is $10,000 or more. |
When subject to such ratable reductions, the annual contribution limit will be rounded up to the next multiple of $10, and shall not be reduced below $200 until the point at which it is reaches zero (0). After 2006, the dollar amounts above will be adjusted by the Secretary of the Treasury for cost-of-living increases under IRC Section 408A(c)(3). Such adjustments will be in multiples of $1,000. For purposes of calculating such a reduction, your modified adjusted gross income is defined in IRC Section 408A(c)(3)(C)(i) and does not include any amount included in adjusted gross income as a result of a rollover to a Roth IRA from an eligible retirement plan other than a Roth IRA, or as a result of a conversion of a non-Roth IRA to a Roth IRA.
For purposes of this provision, compensation is defined as wages, salaries, professional fees, or other amounts derived from or received for personal services actually rendered (including, but not limited to commissions paid salesmen, compensation for services on the basis of a percentage of profits, commissions on insurance premiums, tips, and bonuses) and includes earned income, as defined in IRC Section 401(c)(2) (reduced by the deduction the self-employed individual takes for contributions made to a self-employed retirement plan). For purposes of this definition, IRC Section 401(c)(2) shall be applied as if the term trade or business for purposes of Section 1402 included service described in subsection (c)(6). Compensation does not included amounts derived from or received as earnings or profits from property (including but not limited to interest and dividends) or amounts not includible in gross income. Compensation also does not include any amount received as a pension or annuity or as deferred compensation. The term compensation shall include any amount includible in the individuals gross income under IRC Section 71 with respect to a divorce or separation instrument described in Section 71(b)(2)(A). In the case of a married individual filing a joint return, the greater compensation of his or her spouse is treated as his or her own compensation, but only to the extent that such spouses compensation is not being used for purposes of the spouse making a contribution to a Roth IRA or a deductible contribution to an IRA other than a Roth IRA.
Notwithstanding the dollar limits on contributions, you may make a repayment of a qualified reservist distribution described in IRC Section 72(t)(2)(G) during the two (2) year period beginning on the day after the end of the active duty period or by August 17, 2008, if later.
E6004108NW |
-3- |
ROLLOVER CONTRIBUTION LIMIT. A rollover to this Contract from an eligible retirement plan other than a Roth IRA or designated Roth account cannot be made if, for the year the amount is distributed from the other plan:
1) | you are married (as defined by federal tax law) and file a separate return; or |
2) | you are not married (as defined by federal tax law) and have modified adjusted gross income in excess of $100,000; or |
3) | you are married (as defined by federal tax law) and together you and your spouse have modified adjusted gross income in excess of $100,000. |
For purposes of this provision, your modified adjusted gross income is defined in IRC Section 408A(c)(3)(C)(i) and does not include any amount included in adjusted gross income as a result of a rollover to a Roth IRA from an eligible retirement plan other than a Roth IRA, or as a result of a conversion of a non-Roth IRA to a Roth IRA. You are not treated as married for a taxable year if you have lived apart from your spouse at all times during the taxable year and file separate returns for the taxable year.
These limits do not apply to qualified rollover contributions from another Roth IRA. These limits do not apply to qualified rollover contributions for taxable years beginning after 2009.
ANNUAL REPORT. Following the end of each calendar year, we will send you a report concerning the status of your Contract. This report will include (i) the amount of all regular contributions received during or after the calendar year which relate to such calendar year; (ii) the amount of all rollover contributions received during such calendar year; (iii) the contract value(s) determined as of the end of such calendar year; (iv) such information concerning required minimum distributions as is prescribed by the Commissioner of Internal Revenue; and (v) such other information as may be required under federal tax law.
REQUIRED MINIMUM DISTRIBUTIONS DURING LIFE. No amount is required to be distributed during your lifetime.
REQUIRED MINIMUM DISTRIBUTIONS AFTER DEATH. All distributions made hereunder shall be made in accordance with the requirements of IRC Section 408(b)(3), as modified by Section 408A(c)(5), and the regulations thereunder. If distributions are not made in the form of an annuity on an irrevocable basis (except for acceleration), then distribution of your entire interest in this Contract must satisfy the requirements of IRC Section 408(a)(6), as modified by Section 408A(c)(5), and the regulations thereunder instead of the requirements set out herein.
Upon your death, your entire interest in this Contract will be distributed as least as rapidly as follows:
1) | If an individual other than your surviving spouse (as defined by federal tax law) is your designated beneficiary, then your entire interest will be distributed over the remaining life expectancy of that individual, with payments starting by the end of the calendar year following the calendar year of your death. The life expectancy of the designated beneficiary will be determined using his or her age as of his or her birthday in the year following the year of your death. Alternatively, if elected, your entire interest in this Contract will be distributed by the end of the calendar year that contains the fifth anniversary of your death. |
2) | If your surviving spouse (as defined by federal tax law) is your sole designated beneficiary, then your entire interest will be distributed over such spouses life, with payments starting by the end of the calendar year following the calendar year of your death, or if later, by the end of the calendar year in which you would have reached age 70-1/2. Alternatively, if elected, your entire interest in this Contract will be distributed by the end of the calendar year that contains the fifth anniversary of your death. |
E6004108NW |
-4- |
If your surviving spouse dies before required distributions begin to him or her, the remaining interest will be distributed over the remaining life expectancy of the spouses designated beneficiary, with payments starting by the end of the calendar year following the calendar year of the spouses death. The life expectancy of the spouses designated beneficiary will be determined using his or her age as of his or her birthday in the year following the death of the spouse. Alternatively, if elected, the remaining interest in this Contract will be distributed by the end of the calendar year that contains the fifth anniversary of the surviving spouses death.
If your surviving spouse dies after required distributions begin to him or her, any remaining interest will continue to be distributed under the contract option chosen.
Required distributions are considered to begin on the date distributions are required to begin to your surviving spouse. However, if distributions under this Contract start prior to such date on an irrevocable basis (except for acceleration) in a form meeting the requirements of Section 1.401(a)(9)-6T of the Temporary Income Tax Regulations, then required distributions are considered to begin on the annuity starting date.
3) | If there is no designated beneficiary, then your entire interest in this Contract will be distributed by the end of the calendar year containing the fifth anniversary of your death. |
Life expectancy is determined using the Single Life Table in Q&A-1 of Section 1.401(a)(9)-9 of the Income Tax Regulations. If distributions are being made to your surviving spouse (as defined by federal tax law) as your designated beneficiary, your spouses remaining life expectancy for a year is the number in the Single Life Table corresponding to such spouses age on his or her birthday in the year. In all other cases, remaining life expectancy for a year is the number in the Single Life Table in the year such individuals life expectancy is first determined, reduced by one (1) for each subsequent year.
Your interest in this Contract includes the amount of any outstanding rollover, transfer, or recharacterization under Q&A-7 or Q&A-8 of Section 1.408-8 of the Income Tax Regulations, and the actuarial value of any other benefits provided under the IRA, such as guaranteed death benefits, to the extent required by regulations.
For purposes of this provision, a designated beneficiary is an individual designated under this Contract to receive payments after your death (or the death of your surviving spouse) and who qualifies as a designated beneficiary under Section 1.401(a)(9)-4 of the Income Tax Regulations.
If your surviving spouse (as defined by federal tax law) is the sole designated beneficiary, he or she may elect to treat this Contract as his or her own Roth IRA. This election will be deemed to have been made if he or she becomes Successor Owner of this Contract or fails to take distributions from this Contract otherwise required by this provision. No contribution or rollover to this Contract may be made after your death unless your spouse (as defined by federal tax law) becomes Successor Owner.
E6004108NW |
-5- |
This Endorsement is part of the Contract. It is not a separate contract. It changes the Contract only as and to the extent stated. It supersedes all prior Individual Retirement Annuity endorsements. In all cases of conflict with the other terms of the Contract, the provisions of this Endorsement shall control.
Signed for us at our office as of the date of issue.
[ ] | [ ] | |
[MARK F. MUETHING] | [JOHN P. GRUBER] | |
[PRESIDENT] | [SECRETARY] |
E6004108NW |
-6- |
Exhibit 4(b)(4)
[ ]
Home Office: Cincinnati, Ohio
Administrative Office: [P.O. Box 5420, Cincinnati, Ohio 45201-5420]
SAVINGS INCENTIVE MATCH PLAN FOR EMPLOYEES
INDIVIDUAL RETIREMENT ANNUITY
ENDORSEMENT
The annuity contract is changed as set out below to make it a SIMPLE Individual Retirement Annuity.
APPLICABLE TAX LAW RESTRICTIONS. This annuity contract is intended to receive contributions under a Savings Incentive Match Plan for Employees of Small Employers (SIMPLE IRA plan) that qualify for deferred tax treatment under Internal Revenue Code (IRC) Section 408(p). It is restricted as required by federal tax law. We may change the terms of this annuity contract or administer this annuity contract at any time as needed to comply with that law. Any such change may be applied retroactively.
EXCLUSIVE BENEFIT. This annuity contract is established for the exclusive benefit of you and your beneficiaries. Your interest in this annuity contract is nonforfeitable.
NON-PARTICIPATING. This annuity contract does not pay dividends or share in our surplus.
NO ASSIGNMENT OR TRANSFER. You cannot assign, sell, or transfer your interest in this annuity contract. You cannot pledge it to secure a loan or the performance of an obligation, or for any other purpose. The only exceptions to these rules are:
1) | an interest in this annuity contract may be transferred to a spouse or former spouse under a divorce or separation instrument described in IRC Section 71(b)(2)(A); and |
2) | you may designate another person to receive payments with you based on joint lives or joint life expectancies, but any such designation shall not give that other person any present rights under the annuity contract during your lifetime. |
CONTRIBUTIONS. This annuity contract does not require fixed premiums, purchase payments, or other contributions, but we may decline to accept any contribution of less than $50. This annuity contract will not lapse if contributions are not made for you. This annuity contract will remain subject to cancellation under any involuntary surrender or termination provision of this annuity contract; provided, however, that in no event shall any such cancellation occur unless, at a minimum, contributions have not been made for at least two (2) full contract years and the value of this annuity contract (increased by any guaranteed interest) would provide a benefit at age 70-1/2 of less than $20 a month under the regular settlement option.
E6004202NW |
-1- | (Rev. 10/22) |
All contributions to us must be made in cash BY CHECK OR MONEY ORDER MADE PAYABLE TO US.
This annuity contract will only accept contributions made by an employer under a SIMPLE IRA plan that meets the requirements of IRC Section 408(p), and rollover contributions and transfers from another SIMPLE IRA owned by you. No other contributions to this annuity contract will be accepted.
ANNUAL REPORT. Following the end of each calendar year, we will send you a report concerning the status of your annuity contract. This report will include (i) the amount of all regular contributions received during or after the calendar year which relate to such calendar year; (ii) the amount of all rollover contributions received during such calendar year; (iii) the contract value(s) determined as of the end of such calendar year; (iv) such information concerning required minimum distributions as is prescribed by the Commissioner of Internal Revenue; and (v) such other information as may be required under federal tax law.
If contributions to this annuity contract are paid directly by your employer under a SIMPLE IRA plan, we will provide your employer with the summary description required by IRC Section 408(l)(2)(B).
DESIGNATED FINANCIAL INSTITUTION. If we are the designated financial institution for your employers SIMPLE IRA plan, as defined in IRC Section 408(p)(7), then you may direct that contributions paid on your behalf be transferred without cost or penalty to another SIMPLE IRA owned by you or to an IRA or other eligible retirement plan described in IRC Section 402(c)(8)(B), provided that you elect such a transfer either before the beginning of the calendar year to which such contribution relates or within the 60-day election period which includes the date you first become eligible to participate in the SIMPLE IRA plan.
LIMITS ON ROLLOVERS AND TRANSFERS; ADDITIONAL TAXES. During the first two (2) years that you participate in the SIMPLE IRA plan of your employer, any rollover or transfer otherwise permitted under this annuity contract must be made to another SIMPLE IRA owned by you. In some cases, any distribution to you during this two (2)-year period may be subject to a twenty-five (25) percent additional penalty tax if you do not roll over the amount distributed into a SIMPLE IRA. After the end of this two (2)-year period, a rollover or transfer otherwise permitted under this annuity contract may be made to another SIMPLE IRA owned by you or to an IRA or other eligible retirement plan described in IRC Section 402(c)(8)(B).
REQUIRED MINIMUM DISTRIBUTIONS DURING LIFE. All distributions made hereunder shall be made in accordance with the requirements of IRC Section 408(b)(3) and the regulations thereunder. If distributions are not made in the form of an annuity on an irrevocable basis (except for acceleration), then distribution of your entire interest in this annuity contract must satisfy the requirements of IRC Section 408(a)(6) and the regulations thereunder instead of the requirements set out herein.
The Required Beginning Date for distributions under this annuity contract is April 1 following the calendar year in which you reach age 70-1/2. No later than the Required Beginning Date, your entire interest in this annuity contract must begin to be distributed over (i) your life or the lives of you and your designated beneficiary, or (ii) a period certain not to exceed your life expectancy or the joint and last survivor expectancy of you and your designated beneficiary. Payments must be made in periodic payments at intervals of no longer than one year, and must be either nonincreasing or they may increase only as provided in Q&A-1 and Q&A-4 of Section 1.401(a)(9)-6T of the Temporary Income Tax Regulations. In addition, any distribution must satisfy the incidental benefit requirements specified in Q&A-2 of Section 1.401(a)(9)-6T of the Temporary Income Tax Regulations.
E6004202NW |
-2- |
The distribution period described above cannot exceed the period specified in Section 1.401(a)(9)-6T of the Temporary Income Tax Regulations. The first required payment can be made as late as the Required Beginning Date and must be the payment that is required for a single payment interval. The second payment need not be made until the end of the next payment interval.
Your interest in this annuity contract includes the amount of any outstanding rollover, transfer, or recharacterization under Q&A-7 or Q&A-8 of Section 1.408-8 of the Income Tax Regulations, and the actuarial value of any other benefits provided under the IRA, such as guaranteed death benefits, to the extent required by regulations.
For purposes of this provision, your designated beneficiary is an individual designated under this annuity contract to receive payments after your death and who qualifies as a designated beneficiary under Section 1.401(a)(9)-4 of the Income Tax Regulations.
REQUIRED MINIMUM DISTRIBUTIONS AFTER DEATH. If you die after required distributions begin, the remaining portion of your interest in this annuity contract will continue to be distributed under the contract option chosen.
If you die before required distributions begin, your entire interest in this annuity contract will be distributed as least as rapidly as follows:
1) | If an individual other than your surviving spouse is your designated beneficiary, then your entire interest will be distributed over the remaining life expectancy of that individual, with payments starting by the end of the calendar year following the calendar year of your death. The life expectancy of the designated beneficiary will be determined using his or her age as of his or her birthday in the year following the year of your death. Alternatively, if elected, your entire interest in this annuity contract will be distributed by the end of the calendar year that contains the fifth anniversary of your death. |
2) | If your surviving spouse is your sole designated beneficiary, then your entire interest will be distributed over such spouses life, with payments starting by the end of the calendar year following the calendar year of your death, or if later, by the end of the calendar year in which you would have reached age 70-1/2. Alternatively, if elected, your entire interest in this annuity contract will be distributed by the end of the calendar year that contains the fifth anniversary of your death. |
If your surviving spouse dies before required distributions begin to him or her, the remaining interest will be distributed over the remaining life expectancy of your spouses designated beneficiary, with payments starting by the end of the calendar year following the calendar year of your spouses death. The life expectancy of your spouses designated beneficiary will be determined using his or her age as of his or her birthday in the year following the death of your spouse. Alternatively, if elected, the remaining interest in this annuity contract will be distributed by the end of the calendar year that contains the fifth anniversary of your surviving spouses death.
If your surviving spouse dies after required distributions begin to him or her, any remaining interest will continue to be distributed under the contract option chosen.
3) | If there is no designated beneficiary, then your entire interest in this annuity contract will be distributed by the end of the calendar year containing the fifth anniversary of your death. |
E6004202NW |
-3- |
Life expectancy is determined using the Single Life Table in Q&A-1 of Section 1.401(a)(9)-9 of the Income Tax Regulations. If distributions are being made to your surviving spouse as your designated beneficiary, your spouses remaining life expectancy for a year is the number in the Single Life Table corresponding to such spouses age on his or her birthday in the year. In all other cases, remaining life expectancy for a year is the number in the Single Life Table in the year such individuals life expectancy is first determined, reduced by one (1) for each subsequent year.
Required distributions are considered to begin on your Required Beginning Date or, if applicable, on the date distributions are required to begin to a surviving spouse. However, if distributions under this annuity contract start prior to such date on an irrevocable basis (except for acceleration) in a form meeting the requirements of Section 1.401(a)(9)-6T of the Temporary Income Tax Regulations, then required distributions are considered to begin on the annuity starting date.
Your interest in this annuity contract includes the amount of any outstanding rollover, transfer, or recharacterization under Q&A-7 or Q&A-8 of Section 1.408-8 of the Income Tax Regulations, and the actuarial value of any other benefits provided under the IRA, such as guaranteed death benefits, to the extent required by regulations.
For purposes of this provision, a designated beneficiary is an individual designated under this annuity contract to receive payments after your death (or the death of your surviving spouse) and who qualifies as a designated beneficiary under Section 1.401(a)(9)-4 of the Income Tax Regulations.
If your surviving spouse is the sole designated beneficiary, he or she may elect to treat this annuity contract as his or her own IRA. This election will be deemed to have been made if he or she becomes Successor Owner of this contract or fails to take distributions from this contract otherwise required by this provision. No contribution or rollover to this annuity contract may be made after your death unless your spouse becomes Successor Owner.
This is part of your annuity contract. It is not a separate contract. It changes the annuity contract only as and to the extent stated. In all cases of conflict with the other terms of the annuity contract, the provisions of this Endorsement shall control.
Signed for us at our office as of the date of issue.
[ ] | [ ] | |
[MARK F. MUETHING] | [JOHN P. GRUBER] | |
[PRESIDENT] | [SECRETARY] |
E6004202NW |
-4- |
Exhibit 4(b)(5)
Home Office: Cincinnati, Ohio
Fixed Administrative Office: [P.O. Box 5420, Cincinnati, Ohio 45201-5420]
Variable Administrative Office: [P.O. Box 5423, Cincinnati, Ohio 45201-5423]
INDIVIDUAL RETIREMENT ANNUITY ENDORSEMENT
FOR INHERITED IRA
The annuity contract is changed as set out below to make it an inherited Individual Retirement Annuity.
Inherited IRA
This annuity contract is an inherited IRA under Internal Revenue Code (IRC) Section 408(d)(3)(C). It is maintained to hold qualified funds acquired by the Owner by reason of the death of an individual (the Decedent) that is identified with the name of the Owner. The Owner is the designated beneficiary of the Decedent, as defined in Section 1.401(a)(9)-4 of the Income Tax Regulations, for all funds held under this annuity contract. The Owner is not the surviving spouse of the Decedent.
Applicable Tax Law Restrictions
This annuity contract is restricted as required by federal tax law. We may change the terms of this annuity contract or administer this annuity contract at any time as needed to comply with that law. Any such change may be applied retroactively.
Decedent
We may require you to provide Due Proof of Death for the Decedent. We may require you to provide such other information about the Decedent as needed to administer this contract.
Exclusive Benefit
This annuity contract is established for the exclusive benefit of you and your beneficiaries. Your interest in this annuity contract is nonforfeitable.
Non-Participating
This annuity contract does not pay dividends or share in our surplus.
No Assignment or Transfer
You cannot assign, sell, or transfer your interest in this annuity contract. You cannot pledge it to secure a loan or the performance of an obligation, or for any other purpose.
E6014420NW |
1 | (Rev. 10/22) |
Contributions
Contributions to this annuity contract must be made as a rollover made in accordance with IRC Section 402(c)(11), or as a trustee-to-trustee transfer from another Inherited IRA of the Decedent held for your benefit.
No amount may be contributed as rollover under IRC Section 402(c)(11) if it is a required minimum distribution under IRC Section 401(a)(9) for the year in which the contribution is made or for any prior year.
Annual Report
Following the end of each calendar year, we will send you a report concerning the status of this annuity contract. This report will include (i) the amount of all contributions made as a rollover in accordance with IRC Section 402(c)(11) during such calendar year; (ii) the contract value(s) determined as of the end of such calendar year; (iii) such information concerning required minimum distributions as is prescribed by the Commissioner of Internal Revenue; and (iv) such other information as may be required under federal tax law.
Required Minimum Distributions
The entire interest in this annuity contract will be distributed as least as rapidly as required by IRC Section 401(a)(9)(B) (other than clause (iv)) and the related regulations. The rules for determining the required minimum distributions for the designated beneficiary under the eligible retirement plan also apply to this contract.
If the Decedent has died before his or her required beginning date as determined under IRC Section 401(a)(9)(C), then:
1) | For all calendar years following the calendar year of the Decedents death, distributions must be made over your remaining life expectancy starting by the end of the calendar year following the calendar year of the Decedents death. Your life expectancy will be determined using your age as of your birthday in the year following the year of the Decedents death. |
2) | Alternatively, no amount is required to be distributed until the fifth calendar year following the year of the Decedents death. In that year, the entire interest in this annuity contract must be distributed. |
If the Decedent has died on or after his or her required beginning date as determined under IRC Section 401(a)(9)(C), then for all calendar years following the calendar year of the Decedents death, distributions shall be made over the longer of:
1) | your remaining life expectancy, determined using your age as of your birthday in the year following the year of the Decedents death; or |
2) | the Decedents remaining life expectancy, determined using his or her age as of his or her birthday in the year of his or her death. |
Life expectancy is determined in accordance with Q&A-5 of Section 1.401(a)(9)-5 of the Income Tax Regulations. It is determined using the Single Life Table in Q&A-1 of Section 1.401(a)(9)-9 of the Income Tax Regulations. The remaining life expectancy for a year is the number in the Single Life Table in the first year for which the life expectancy is to be determined, reduced by one (1) for each subsequent year.
If paid in the form of an irrevocable annuity, payments must be made in periodic payments at intervals of no longer than one year, and must be either nonincreasing or they may increase only as provided in Q&A-1 and Q&A-4 of Section 1.401(a)(9)-6 of the Income Tax Regulations.
The entire interest in this annuity contract includes the amount of any outstanding rollover under IRC Section 402(c)(11) or transfer under Q&A-8 of Section 1.408-8 of the Income Tax Regulations, and the actuarial value of any other benefits provided under the IRA, such as guaranteed death benefits, to the extent required by regulations.
E6014420NW |
2 |
Notwithstanding the foregoing rules, no amount is required to be distributed until the tenth calendar year following the year of the Decedents death, and the entire interest in this annuity contract must be distributed by the end of that tenth year, if:
1) | the Decedent died on or after January 1, 2020; |
2) | the Decedent died before his or her required beginning date as determined under IRC Section 401(a)(9)(C); and |
3) | the annuity contract holds only funds from an individual retirement arrangement of the Decedent or defined contribution plan of the Decedent. |
In any event, the entire interest in this annuity contract must be distributed by the end of the tenth year following the year of the Decedents death if:
1) | the Decedent died on or after January 1, 2020; |
2) | the annuity contract holds any funds from an individual retirement arrangement of the Decedent or defined contribution plan of the Decedent; and |
3) | the Owner is not a eligible designated beneficiary as determined under IRC Section 401(a)(9)(E)(ii). |
The entire interest in this annuity contract must be distributed by the end of the tenth year following the year that the Owner reaches the age of majority if:
1) | the Decedent died on or after January 1, 2020; |
2) | the annuity contract holds any funds from an individual retirement arrangement of the Decedent or defined contribution plan of the Decedent; and |
3) | the Owner is an a eligible designated beneficiary as a minor child of the Decedent as determined under IRC Section 401(a)(9)(E)(ii)(II). |
The entire interest in this annuity contract must be distributed by the end of the tenth year following the year that the Decedents designated beneficiary dies if:
1) | the Decedents designated beneficiary died on or after January 1, 2020; |
2) | the annuity contract holds any funds from an individual retirement arrangement of the Decedent or defined contribution plan of the Decedent. |
This is part of your annuity contract. It is not a separate contract. It changes the annuity contract only as and to the extent stated. In all cases of conflict with the other terms of the annuity contract, the provisions of this Endorsement shall control.
Signed for us at our office as of the date of issue.
[ ] | [ ] | |
[Mark F. Muething] | [John P. Gruber] | |
[President] | [Secretary] |
E6014420NW |
3 |
Exhibit 4(b)(6)
[ ]
Home Office: Cincinnati, Ohio
Administrative Office: [P.O. Box 5420, Cincinnati, Ohio 45201-5420]
GOVERNMENTAL SECTION 457 PLAN
ENDORSEMENT
The annuity contract is changed as set out below to add provisions for a governmental Section 457 plan. This endorsement and the annuity contract to which it is attached are not valid without additional endorsement(s) defining the Plan and Plan Administrator.
APPLICABLE TAX LAW RESTRICTIONS. This annuity contract is intended to receive contributions pursuant to an eligible deferred compensation plan as defined under Internal Revenue Code (IRC) Section 457(b) that is maintained by a state, a political subdivision of a state, or any agency or instrumentality of a state or political subdivision of a state. It is restricted as required by federal tax law. We may change the terms of this annuity contract or administer this annuity contract at any time as needed to comply with that law. Any such change may be applied retroactively.
ANNUITANT. Annuitant means the designated person covered under the Plan for whose benefit this annuity contract was purchased. If the owner of this annuity contract is the Employer or Plan trustee, then any reference in this annuity contract to the owners life, age, death, or spouse shall be treated as a reference to the Annuitants life, age, death, or spouse.
EXCLUSIVE BENEFIT. This annuity contract is established for the exclusive benefit of the Annuitant and his or her beneficiaries. No amounts held under this annuity contract may be used for or diverted to any purpose other than the provision of Plan benefits except as permitted by the Plan after the complete satisfaction of all liabilities to persons covered by the Plan and their beneficiaries. Until distributed, the Plan retains all legal ownership rights and controls over the Annuitants interest in the annuity contract except as provided by the Plan Administrator.
NO ASSIGNMENT OR TRANSFER. No interest in this annuity contract may be assigned, sold, or transferred. No interest in this annuity contract may be pledged to secure a loan or the performance of an obligation, or for any other purpose. The only exceptions to these rules are:
1) | if this annuity contract is owned by the Employer or Plan trustee, it may be transferred to a successor Employer or Plan trustee, or to the Annuitant or another person entitled to Plan benefits through the Annuitant; |
2) | the Annuitants interest in this annuity contract may secure a loan made to the Annuitant under any loan provisions of this annuity contract; |
E6004505NW |
-1- | (Rev. 10/22) |
3) | all or part of the Annuitants interest in this annuity contract may be transferred under a Qualified Domestic Relations Order as defined in IRC Section 414(p); and |
4) | payments may be made based on the joint lives or joint life expectancies of the Annuitant and another person, but such other person shall have no present rights under this annuity contract during the lifetime of the Annuitant. |
Except as elected under the Direct Rollover provision, any distributions under this annuity contract shall be paid either to the Plan trustee or to the Annuitant or other person entitled to Plan benefits through the Annuitant, as may be directed by the Plan Administrator.
LIMITS ON CONTRIBUTIONS. Contributions to this annuity contract that represent contributions to the Plan must not exceed the limits set forth in IRC Section 457(b) and (c). Catch-up contributions may be made to the full extent permitted by IRC Section 414(v). No elective contributions may be made by the Annuitant with respect to any month unless the Annuitant has entered an agreement for deferral before the first day of that month. However, an elective contribution may be made for the first month of employment of the Annuitant if the agreement for deferral is made on or before the date that service with the Employer begins. Additional limits may apply under the terms of the Plan. The Plan Administrator shall ensure compliance with these IRC limits and any Plan limits.
DISTRIBUTION RESTRICTIONS. As required under IRC Section 457(d), no distributions from this annuity contract can be made until:
1) | the calendar year in which the Annuitant reaches age 70-1/2; or |
2) | the Annuitant has a severance from employment with the Employer; or |
3) | the Annuitant is faced with an unforeseeable emergency as defined under the IRC; or |
4) | the conditions are met for an in-service distribution under IRC Section 457(e)(9). |
For this purpose, a direct transfer to a defined benefit governmental plan as defined in IRC Section 414(d), that is made to purchase permissive service credit as defined in IRC Section 415(n)(3)(A) or as a repayment described in IRC Section 415(k)(3), shall not be treated as a distribution.
Additional limits may apply under the terms of the Plan. The Plan Administrator shall determine when a distribution is allowed under this IRC section and the Plan.
DIRECT ROLLOVERS. To the extent required under IRC Section 401(a)(31), the Annuitant or his or her surviving spouse may elect to have any portion of an eligible rollover distribution, as defined in IRC Section 403(b)(8), paid directly to an Individual Retirement Annuity or Individual Retirement Account, as defined in IRC Section 408, or, if allowed, to another governmental Section 457 plan or other eligible retirement plan described in IRC Section 402(c)(8)(B), specified by the Annuitant or surviving spouse and which accepts such distribution. Any direct rollover election must be made on our form, and must be received at our office before the date of payment.
REQUIRED MINIMUM DISTRIBUTIONS DURING LIFE. All distributions made hereunder shall be made in accordance with the requirements of IRC Section 401(a)(9) and Section 1.401(a)(9)-6T of the Temporary Income Tax Regulations. If distributions are not made in the form of an annuity on an irrevocable basis (except for acceleration), then distribution of the Annuitants entire interest in this annuity contract must satisfy the requirements of IRC Section 401(a)(9) and Section 1.401(a)(9)-5 of the Income Tax Regulations instead of the requirements set out herein.
E6004505NW |
-2- |
The Required Beginning Date for distributions under this annuity contract is April 1 following the later of the calendar year in which the Annuitant reaches age 70-1/2 or the calendar year in which the Annuitant retires. No later than the Required Beginning Date, the Annuitants entire interest in this annuity contract must begin to be distributed over (i) the Annuitants life or the lives of the Annuitant and his or her designated beneficiary, or (ii) a period certain not to exceed the Annuitants life expectancy or the joint and last survivor expectancy of the Annuitant and his or her designated beneficiary. Payments must be made in periodic payments at intervals of no longer than one (1) year, and must be either nonincreasing or they may increase only as provided in Q&A-1 and Q&A-4 of Section 1.401(a)(9)-6T of the Temporary Income Tax Regulations. In addition, any distribution must satisfy the incidental benefit requirements specified in Q&A-2 of Section 1.401(a)(9)-6T of the Temporary Income Tax Regulations.
The distribution period described above cannot exceed the period specified in Section 1.401(a)(9)-6T of the Temporary Income Tax Regulations. The first required payment can be made as late as the Required Beginning Date and must be the payment that is required for a single payment interval. The second payment need not be made until the end of the next payment interval.
The Annuitants interest in this annuity contract includes the amount of any outstanding rollover or transfer, and the actuarial value of any other benefits provided under the annuity contract, such as guaranteed death benefits, to the extent required by regulations.
For purposes of this provision, the Annuitants designated beneficiary is an individual designated under the Plan to receive payments after the Annuitants death and who qualifies as a designated beneficiary under Section 1.401(a)(9)-4 of the Income Tax Regulations.
REQUIRED MINIMUM DISTRIBUTIONS AFTER DEATH. If the Annuitant dies after required distributions begin, the remaining portion of the Annuitants interest in this annuity contract will continue to be distributed under the contract option chosen.
If the Annuitant dies before required distributions begin, the Annuitants entire interest in this annuity contract will be distributed as least as rapidly as follows:
1) | If an individual other than the Annuitants surviving spouse is his or her designated beneficiary, then the Annuitants entire interest will be distributed over the remaining life expectancy of that individual, with payments starting by the end of the calendar year following the calendar year of the Annuitants death. The life expectancy of the designated beneficiary will be determined using his or her age as of his or her birthday in the year following the year of the Annuitants death. Alternatively, if elected, the Annuitants entire interest in this annuity contract will be distributed by the end of the calendar year that contains the fifth anniversary of the Annuitants death. |
2) | If the Annuitants surviving spouse is his or her sole designated beneficiary, then the Annuitants entire interest will be distributed over such spouses life, with payments starting by the end of the calendar year following the calendar year of the Annuitants death, or if later, by the end of the calendar year in which the Annuitant would have reached age 70-1/2. Alternatively, if elected, the Annuitants entire interest in this annuity contract will be distributed by the end of the calendar year that contains the fifth anniversary of the Annuitants death. |
E6004505NW |
-3- |
If the Annuitants surviving spouse dies before required distributions begin to him or her, the remaining interest will be distributed over the remaining life expectancy of the spouses designated beneficiary, with payments starting by the end of the calendar year following the calendar year of the spouses death. The life expectancy of the spouses designated beneficiary will be determined using his or her age as of his or her birthday in the year following the death of the Annuitants spouse. Alternatively, if elected, the remaining interest in this annuity contract will be distributed by the end of the calendar year that contains the fifth anniversary of the surviving spouses death.
If the Annuitants surviving spouse dies after required distributions begin to him or her, any remaining interest will continue to be distributed under the contract option chosen.
3) | If there is no designated beneficiary, then the Annuitants entire interest in this annuity contract will be distributed by the end of the calendar year containing the fifth anniversary of the Annuitants death. |
Life expectancy is determined using the Single Life Table in Q&A-1 of Section 1.401(a)(9)-9 of the Income Tax Regulations. If distributions are being made to the Annuitants surviving spouse as the designated beneficiary, the spouses remaining life expectancy for a year is the number in the Single Life Table corresponding to such spouses age on his or her birthday in the year. In all other cases, remaining life expectancy for a year is the number in the Single Life Table in the year such individuals life expectancy is first determined, reduced by one (1) for each subsequent year.
Required distributions are considered to begin on the Required Beginning Date or, if applicable, on the date distributions are required to begin to a surviving spouse. However, if distributions under this annuity contract start prior to such date on an irrevocable basis (except for acceleration) in a form meeting the requirements of Section 1.401(a)(9)-6T of the Temporary Income Tax Regulations, then required distributions are considered to begin on the annuity starting date.
The Annuitants interest in this annuity contract includes the amount of any outstanding rollover or transfer, and the actuarial value of any other benefits provided under the annuity contract, such as guaranteed death benefits, to the extent required by regulations.
For purposes of this provision, a designated beneficiary is an individual designated under this annuity contract to receive payments after the Annuitants death (or the death of the Annuitants surviving spouse) and who qualifies as a designated beneficiary under Section 1.401(a)(9)-4 of the Income Tax Regulations.
This is part of the annuity contract. It is not a separate contract. It changes the annuity contract only as and to the extent stated. In all cases of conflict with the other terms of the annuity contract, the provisions of this Endorsement shall control.
Signed for us at our office as of the date of issue.
[ ] | [ ] | |
[MARK F. MUETHING] | [JOHN P. GRUBER] | |
[PRESIDENT] | [SECRETARY] |
E6004505NW |
-4- |
Exhibit 4(b)(7)
[ ]
Home Office: Cincinnati, Ohio
Fixed Administrative Office: [P.O. Box 5420, Cincinnati, Ohio 45201-5420]
TAX SHELTERED ANNUITY ENDORSEMENT
The annuity contract (Contract) is changed by this Tax-Sheltered Annuity Endorsement (this Endorsement) to add the following additional provisions:
APPLICABLE TAX LAW RESTRICTIONS. This Contract is intended to receive contributions that qualify for deferred tax treatment under Internal Revenue Code (IRC) Section 403(b). It is restricted as required by federal tax law. We may change the terms of this Contract or administer this Contract at any time as needed to comply with that law. Any such change may be applied retroactively.
APPLICABLE PLAN RESTRICTIONS. To the extent required to satisfy the Income Tax Regulations under IRC Section 403(b):
1) | this Contract is subject to the terms of the 403(b) retirement plan under which contributions were made (the Plan) that is sponsored or maintained by an eligible employer (the Employer); in the event of any conflict, the terms of the Plan control, provided that such terms do not require us to provide benefits not otherwise provided under this Contract; |
2) | we will share with the Employer, a Plan administrator, or other vendor under the Plan, any information necessary for this Contract, or any other annuity contract or custodial account to which contributions have been made by the Employer, to satisfy IRC Section 403(b), including the following: (i) the Employer providing information as to whether your employment with the Employer is continuing, and notifying us when you have had a severance from employment (for purposes of the distribution restrictions under the Plan); (ii) our notifying the Employer of any hardship withdrawal under the Plan if the withdrawal results in a 6-month suspension of your right to make elective deferrals under the Plan; and (iii) our providing information to the Employer and other vendors concerning your interests in annuity contracts or qualified plan benefits (to enable a vendor to determine the amount of any plan loans and any rollover accounts that are available to you under the Plan in order to satisfy the financial need under the hardship withdrawal rules); and |
3) | we will share with the Employer, a Plan administrator, or other vendor under the Plan, any information in order of this Contract or any other annuity contract or custodial account to which contributions have been made for you by the Employer, to satisfy other tax law requirements, including the following: (i) the amount of any plan loan that is outstanding to you for a vendor to determine whether an additional plan loan satisfies the loan limitations of the Plan, so that any such additional loan is not a deemed distribution under IRC Section 72(p)(1); and (ii) information concerning your after-tax employee contributions in order for a vendor to determine the extent to which a distribution is includible in gross income. |
E6004308NW |
-1- | (Rev. 10/22) |
The Plan may require that no distribution, loan, contract exchange, plan-to-plan transfer, or rollover contribution involving this Contract be made without specific instructions from the Employer or a Plan administrator. We may rely on representations, instructions, and information provided by the Employer or a Plan administrator. We may rely on representations and information provided by other vendors under the Plan.
This provision does not apply if:
1) | this Contract is funded solely with amounts transferred from another Section 403(b) annuity contract or from a custodial account described in IRC Section 403(b)(7); |
2) | each transfer was qualified as a tax-free direct transfer described in Revenue Ruling 90-24; and |
3) | each transfer was made on or before September 24, 2007. |
NO ASSIGNMENT OR TRANSFER. You cannot assign, sell, or transfer your interest in this Contract. You cannot pledge it to secure a loan or the performance of an obligation, or for any other purpose. The only exceptions to these rules are:
1) | this Contract may secure a loan made to you under any loan provisions of this Contract; |
2) | all or part of your interest in this Contract may be transferred under a Qualified Domestic Relations Order as defined in IRC Section 414(p); and |
3) | payments from this Contract may be based on the joint lives or joint life expectancies of you and another person, but such other person shall have no present rights in this Contract during your lifetime. |
LIMIT ON SOURCE OF PURCHASE PAYMENTS. Purchase Payments for this Contract are limited to:
1) | contributions made by or through the Employer under the Plan; |
2) | rollover contributions described in IRC Sections 402(c), 402(e)(6), 403(a)(4), 403(b)(8), 403(b)(10), 408(d)(3), or 457(e)(16), to the extent permitted under the Plan; |
3) | annuity contract and custodial account exchanges described in Section 1.403(b)-10(b)(2) of the Income Tax Regulations; and |
4) | plan-to-plan transfers described in Section 1.403(b)-10(b)(3) of the Income Tax Regulations. |
DESIGNATED ROTH CONTRIBUTIONS. To the extent permitted under the Plan, Purchase Payments may include:
1) | contributions that are designated Roth contributions within the meaning of IRC Section 402A(c)(1); |
2) | rollover contributions that are described in IRC Section 402A(c)(3) from a designated Roth account under an applicable retirement plan described in IRC Section 402A(e)(1); |
3) | contract and custodial account exchanges from designated Roth accounts under the Plan; or |
4) | plan-to-plan transfers from designated Roth accounts under an applicable retirement plan described in IRC Section 402A(e)(1). |
All amounts that are attributable to designated Roth contributions must be maintained in a separate account. Separate records will be kept for each such account.
E6004308NW |
-2- |
LIMITS ON AMOUNT OF CONTRIBUTIONS. Except for catch-up contributions permitted by IRC Section 414(v):
1) | contributions made to this Contract and any other plan, contract, or arrangement under salary reduction agreement(s) with an employer cannot exceed the limits of IRC Section 402(g), and we may distribute any contributions in excess of this limit, together with the income allocable thereto and net of any loss thereon, to you as permitted by law; and |
2) | contributions to this Contract cannot exceed the limit of IRC Section 415. |
These limits do not apply to rollover contributions.
DISTRIBUTION RESTRICTIONS FOR ELECTIVE DEFERRALS. Amounts attributable to IRC Section 403(b) elective deferrals (including any designated Roth contributions) cannot be distributed from this Contract unless:
1) | you have reached age 59-1/2; |
2) | you have had a severance from employment with the Employer; |
3) | you have died; |
4) | you have become disabled as defined in IRC Section 72(m)(7); |
5) | you have incurred a hardship by reason of an immediate and heavy financial need as defined in Section 1.401(k)-1(d)(3)(iii)(B) of the Income Tax Regulations, to the extent a distribution is necessary as determined under Section 1.401(k)-1(d)(3)(iv)(E) of the Income Tax Regulations ; or |
6) | you qualify for a distribution as a reservist called to active duty as described in IRC Section 72(t)(2)(G). |
A withdrawal made by reason of a hardship cannot include any income attributable to salary reduction contributions. These distribution restrictions do not apply to 403(b) elective deferrals made before January 1, 1989, and to earnings credited prior to such date.
DISTRIBUTION RESTRICTIONS FOR CUSTODIAL ACCOUNT TRANSFERS. Amounts attributable to transfers from a custodial account described in IRC Section 403(b)(7), other than amounts attributable to 403(b) elective deferrals, cannot be distributed from this Contract unless:
1) | you have reached age 59-1/2; |
2) | you have had a severance from employment with the Employer; |
3) | you have died; or |
4) | you have become disabled as defined in IRC Section 72(m)(7). |
DISTRIBUTION RESTRICTIONS FOR OTHER AMOUNTS. Amounts other than those attributable to 403(b) elective deferrals or to transfers from a custodial account described in IRC Section 403(b)(7) cannot be distributed from this Contract unless:
1) | you have had a severance from employment with the Employer; or |
2) | upon the occurrence of some event specified in the Plan, such as after a fixed number of years, the attainment of a stated age, or disability. |
This provision does not apply to an annuity contract that is issued before January 1, 2009.
E6004308NW |
-3- |
ABSENCE OF SEPARATE ACCOUNTING. If a separate account has not been maintained for 403(b) elective deferrals, custodial account transfers, rollovers, and other amounts, then no amount shall be distributed until the later of:
1) | the date that amounts attributable to 403(b) elective deferrals may be distributed; or |
2) | the date that amounts attributable to a custodial account transfer may be distributed, or the date that other amounts may be distributed, whichever is applicable. |
DISTRIBUTION RESTRICTIONS FOR EXCHANGES AND TRANSFERS. Amounts attributable to transfers from another Section 403(b) annuity contract or from a custodial account described in IRC Section 403(b)(7) by means of a contract exchange or plan-to-plan transfer shall be subject to distribution restrictions that are at least as stringent as those imposed by the contract being exchanged or by the plan making the transfer.
EXCEPTIONS TO DISTRIBUTION RESTRICTIONS. The distribution restrictions that otherwise apply to this Contract shall not apply to:
1) | a correction of excess deferrals as provided in Section 1.403(b)-4(f) of the Income Tax Regulations; |
2) | a distribution required by the Employer on termination of the Plan as provided in Section 1.403(b)-10(a) of the Income Tax Regulations; |
3) | a permissible withdrawal of eligible automatic contributions as provided in IRC Section 414(w); |
4) | payments to an alternate payee under a Qualified Domestic Relations Order as provided in Section 1.403(b)-10(c) of the Income Tax Regulations; or |
5) | amounts attributable to rollover contributions, provided that they are maintained in a separate account. |
TRANSFERS AND EXCHANGES NOT CONSIDERED DISTRIBUTIONS. For purposes of applying the distribution restrictions to this Contract, the following are not considered to be distributions:
1) | direct transfers to a defined benefit governmental plan as defined in IRC Section 414(d), that are made to purchase permissive service credit as defined in IRC Section 415(n)(3)(A) or as a repayment described in IRC Section 415(k)(3); |
2) | contract or custodial account exchanges that are described in Section 1.403(b)-10(b)(2) of the Income Tax Regulations; or |
3) | plan-to-plan transfers that are described in Section 1.403(b)-10(b)(3) of the Income Tax Regulations. |
DIRECT ROLLOVERS PERMITTED. To the extent required under IRC Section 401(a)(31), you or your surviving spouse (as defined by federal tax law) may elect to have any portion of an eligible rollover distribution, as defined in IRC Section 403(b)(8), paid directly to an Individual Retirement Annuity or Individual Retirement Account, as defined in IRC Section 408, or, if allowed, to another Tax Sheltered Annuity or other eligible retirement plan described in IRC Section 402(c)(8)(B), specified by you or your surviving spouse and which accepts such distribution. To the extent permitted under IRC Section 402(c)(11), your nonspouse beneficiary may elect to have any portion of a distribution paid directly to an inherited Individual Retirement Annuity or Individual Retirement Account, as defined in IRC Section 408(d)(3)(C). Any direct rollover election must be made on our form, and must be received at our office before the date of payment.
E6004308NW |
-4- |
REQUIRED MINIMUM DISTRIBUTIONS DURING LIFE. All distributions made hereunder shall be made in accordance with the requirements of IRC Section 403(b)(10) and Section 1.401(a)(9)-6 of the Income Tax Regulations, as modified by Sections 1.408-8 and 1.403(b)-6(e) of the Income Tax Regulations. If distributions are not made in the form of an annuity on an irrevocable basis (except for acceleration), then distribution of your entire interest in this Contract must satisfy the requirements of IRC Section 403(b)(10) and Section 1.401(a)(9)-5 of the Income Tax Regulations, as modified by Sections 1.408-8 and 1.403(b)-6(e) of the Income Tax Regulations, instead of the requirements set out herein.
The Required Beginning Date for distributions of your interest in this Contract is April 1 following the later of the calendar year in which you reach age 70-1/2 or the calendar year in which you retire from the Employer. No later than the Required Beginning Date, your entire interest in this Contract must begin to be distributed over (i) your life or the lives of you and your designated beneficiary, or (ii) a period certain not to exceed your life expectancy or the joint and last survivor expectancy of you and your designated beneficiary. Payments must be made in periodic payments at intervals of no longer than one year, and must be either nonincreasing or they may increase only as provided in Q&A-1 and Q&A-4 of Section 1.401(a)(9)-6 of the Income Tax Regulations. In addition, any distribution must satisfy the incidental benefit requirements specified in Q&A-2 of Section 1.401(a)(9)-6 of the Income Tax Regulations.
The distribution period described above cannot exceed the period specified in Section 1.401(a)(9)-T of the Income Tax Regulations. The first required payment can be made as late as the Required Beginning Date and must be the payment that is required for a single payment interval. The second payment need not be made until the end of the next payment interval.
Your interest in this Contract includes the amount of any outstanding rollover or transfer, and the actuarial value of any other benefits provided under this Contract, such as guaranteed death benefits, to the extent required by regulations.
For purposes of this provision, your designated beneficiary is an individual designated under this Contract to receive payments after your death and who qualifies as a designated beneficiary under Section 1.401(a)(9)-4 of the Income Tax Regulations.
REQUIRED MINIMUM DISTRIBUTIONS AFTER DEATH. If you die after required distributions begin, the remaining portion of your interest in this Contract will continue to be distributed under the contract option chosen.
If you die before required distributions begin, your entire interest in this Contract will be distributed as least as rapidly as follows:
1) | If an individual other than your surviving spouse (as defined by federal tax law) is your designated beneficiary, then your entire interest will be distributed over the remaining life expectancy of that individual, with payments starting by the end of the calendar year following the calendar year of your death. The life expectancy of the designated beneficiary will be determined using his or her age as of his or her birthday in the year following the year of your death. Alternatively, if elected, your entire interest in this Contract will be distributed by the end of the calendar year that contains the fifth anniversary of your death. |
2) | If your surviving spouse (as defined by federal tax law) is your sole designated beneficiary, then your entire interest will be distributed over such spouses life, with payments starting by the end of the calendar year following the calendar year of your death, or if later, by the end of the calendar year in which you would have reached age 70-1/2. Alternatively, if elected, your entire interest in this Contract will be distributed by the end of the calendar year that contains the fifth anniversary of your death. |
E6004308NW |
-5- |
If your surviving spouse dies before required distributions begin to him or her, the remaining interest will be distributed over the remaining life expectancy of the spouses designated beneficiary, with payments starting by the end of the calendar year following the calendar year of the spouses death. The life expectancy of the spouses designated beneficiary will be determined using his or her age as of his or her birthday in the year following the death of the spouse. Alternatively, if elected, the remaining interest in this Contract will be distributed by the end of the calendar year that contains the fifth anniversary of the surviving spouses death.
If your surviving spouse dies after required distributions begin to him or her, any remaining interest will continue to be distributed under the contract option chosen.
3) | If there is no designated beneficiary, then your entire interest in this Contract will be distributed by the end of the calendar year containing the fifth anniversary of your death. |
Life expectancy is determined using the Single Life Table in Q&A-1 of Section 1.401(a)(9)-9 of the Income Tax Regulations. If distributions are being made to your surviving spouse (as defined by federal tax law) as the designated beneficiary, the spouses remaining life expectancy for a year is the number in the Single Life Table corresponding to such spouses age on his or her birthday in the year. In all other cases, remaining life expectancy for a year is the number in the Single Life Table in the year such individuals life expectancy is first determined, reduced by one (1) for each subsequent year.
Required distributions are considered to begin on your Required Beginning Date or, if applicable, on the date distributions are required to begin to a surviving spouse. However, if distributions of your interest in this Contract start prior to such date on an irrevocable basis (except for acceleration) in a form meeting the requirements of Section 1.401(a)(9)-6 of the Income Tax Regulations, then required distributions are considered to begin on the annuity starting date.
Your interest in this Contract includes the amount of any outstanding rollover or transfer, and the actuarial value of any other benefits provided under this Contract, such as guaranteed death benefits, to the extent required by regulations.
For purposes of this provision, a designated beneficiary is an individual designated under this Contract to receive payments after your death (or the death of a surviving spouse) and who qualifies as a designated beneficiary under Section 1.401(a)(9)-4 of the Income Tax Regulations.
This Endorsement is part of the Contract. It is not a separate contract. It changes the Contract only as and to the extent stated. It supersedes all prior Tax-Sheltered Annuity endorsements. In all cases of conflict with the other terms of the Contract, the provisions of this Endorsement shall control.
Signed for us at our office as of the date of issue.
[ ] | [ ] | |
[MARK F. MUETHING] | [JOHN P. GRUBER] | |
[PRESIDENT] | [SECRETARY] |
E6004308NW |
-6- |
Exhibit 4(b)(8)
[ ]
Home Office: Cincinnati, Ohio
Administrative Office: [P.O. Box 5420, Cincinnati, Ohio 45201-5420]
QUALIFIED PENSION, PROFIT SHARING,
AND ANNUITY PLAN ENDORSEMENT
The annuity contract is changed as set out below to add provisions for a qualified pension, profit sharing, or annuity plan. This endorsement and the annuity contract to which it is attached are not valid without additional endorsement(s) defining the Plan and Plan Administrator.
APPLICABLE TAX LAW RESTRICTIONS. This annuity contract is intended to receive contributions pursuant to a pension, profit sharing, or annuity plan qualified under Internal Revenue Code (IRC) Section 401(a) or 403(a). It is restricted as required by federal tax law. We may change the terms of this annuity contract or administer this annuity contract at any time as needed to comply with that law. Any such change may be applied retroactively.
ANNUITANT. Annuitant means the designated person covered under the Plan for whose benefit this annuity contract was purchased. If the owner of this annuity contract is the Employer or Plan trustee, then any reference in this annuity contract to the owners life, age, death, or spouse shall be treated as a reference to the Annuitants life, age, death, or spouse.
EXCLUSIVE BENEFIT. This annuity contract is established for the exclusive benefit of the Annuitant and his or her beneficiaries. No amounts held under this annuity contract may be used for or diverted to any purpose of then the provision of Plan benefits except as permitted by the Plan after the complete satisfaction of all liabilities to persons covered by the Plan and their beneficiaries. Until distributed, the Plan retains all legal ownership rights and controls over the Annuitants interest in the annuity contract except as provided by the Plan Administrator.
NO ASSIGNMENT OR TRANSFER. No interest in this annuity contract may be assigned, sold, or transferred. No interest in this annuity contract may be pledged to secure a loan or the performance of an obligation, or for any other purpose. The only exceptions to these rules are:
1) | if this annuity contract is owned by the Employer or Plan trustee, it may be transferred to a successor Employer or Plan trustee, or to the Annuitant or another person entitled to Plan benefits through the Annuitant; |
2) | the Annuitants interest in this annuity contract may secure a loan made to the Annuitant under any loan provisions of this annuity contract; |
E6004405NW |
-1- | (Rev. 10/22) |
3) | all or part of the Annuitants interest in this annuity contract may be transferred under a Qualified Domestic Relations Order as defined in IRC Section 414(p); and |
4) | payments may be made based on the joint lives or joint life expectancies of the Annuitant and another person, but such other person shall have no present rights under this annuity contract during the lifetime of the Annuitant. |
Except as elected under the Direct Rollover provision, any distributions under this annuity contract shall be paid either to the Plan trustee or to the Annuitant or other person entitled to Plan benefits through the Annuitant, as may be directed by the Plan Administrator.
LIMITS ON CONTRIBUTIONS. Contributions to this annuity contract that represent contributions to the Plan must not exceed the limits set forth in IRC Section 415. Contributions to this annuity contract that represent elective deferrals cannot exceed the limits of IRC Section 402(g). Catch-up contributions may be made to the full extent permitted by IRC Section 414(v). Additional limits may apply under the terms of the Plan. The Plan Administrator shall ensure compliance with these IRC limits and any Plan limits.
DISTRIBUTION RESTRICTIONS ON ELECTIVE CONTRIBUTIONS. Any portion of this annuity contract that represents elective contributions under a qualified cash or deferred arrangement described in IRC Section 401(k), and any income attributable to such amounts, cannot be distributed any earlier than allowed under IRC Section 401(k)(2)(B). Additional limits may apply under the terms of the Plan. The Plan Administrator shall determine when a distribution is allowed under this IRC section and the Plan.
DISTRIBUTION RESTRICTIONS ON PENSION CONTRIBUTIONS. Any portion of this annuity contract that represents contributions to a money purchase pension plan or a defined benefit pension plan, and any income attributable to such amounts, cannot be distributed any earlier than allowed under Section 1.401(b)(1)(i) of the Income Tax Regulations. Additional limits may apply under the terms of the Plan. The Plan Administrator shall determine when a distribution is allowed under this regulation and the Plan.
DIRECT ROLLOVERS. To the extent required under IRC Section 401(a)(31), the Annuitant or his or her surviving spouse may elect to have any portion of an eligible rollover distribution, as defined in IRC Section 403(b)(8), paid directly to an Individual Retirement Annuity or Individual Retirement Account, as defined in IRC Section 408, or, if allowed, to another qualified pension, profit sharing, or annuity plan or other eligible retirement plan described in IRC Section 402(c)(8)(B), specified by the Annuitant or surviving spouse and which accepts such distribution. Any direct rollover election must be made on our form, and must be received at our office before the date of payment.
DATE BENEFITS TO BEGIN. Unless the Annuitant elects to delay the payment of his or her benefits, distribution of the Annuitants interest in this annuity contract shall begin no later than 60 days after the end of the Plan year in which the last of the following occurs:
1) | the Annuitant has reached the earlier of age 65 or the normal retirement age stated in the Plan; |
2) | the 10th anniversary of the date that the Annuitant joined the Plan; or |
3) | the date that the Annuitant has a severance from employment with the Employer. |
The Plan Administrator shall make any determination required under this provision.
E6004405NW |
-2- |
In no event can the payment of benefits be delayed beyond the Required Beginning Date stated in the Required Minimum Distributions During Life provision of this Endorsement.
REQUIRED MINIMUM DISTRIBUTIONS DURING LIFE. All distributions made hereunder shall be made in accordance with the requirements of IRC Section 401(a)(9) and Section 1.401(a)(9)-6T of the Temporary Income Tax Regulations. If distributions are not made in the form of an annuity on an irrevocable basis (except for acceleration), then distribution of the Annuitants entire interest in this annuity contract must satisfy the requirements of IRC Section 401(a)(9) and Section 1.401(a)(9)-5 of the Income Tax Regulations instead of the requirements set out herein.
The Required Beginning Date for distributions under this annuity contract is April 1 following the later of the calendar year in which the Annuitant reaches age 70-1/2 or the calendar year in which the Annuitant retires. For any 5% owner of the Employer, the Required Beginning Date is April 1 following the calendar year in which the Annuitant reaches age 70-1/2. No later than the Required Beginning Date, the Annuitants entire interest in this annuity contract must begin to be distributed over (i) the Annuitants life or the lives of the Annuitant and his or her designated beneficiary, or (ii) a period certain not to exceed the Annuitants life expectancy or the joint and last survivor expectancy of the Annuitant and his or her designated beneficiary. Payments must be made in periodic payments at intervals of no longer than one (1) year, and must be either nonincreasing or they may increase only as provided in Q&A-1 and Q&A-4 of Section 1.401(a)(9)-6T of the Temporary Income Tax Regulations. In addition, any distribution must satisfy the incidental benefit requirements specified in Q&A-2 of Section 1.401(a)(9)-6T of the Temporary Income Tax Regulations.
The distribution period described above cannot exceed the period specified in Section 1.401(a)(9)-6T of the Temporary Income Tax Regulations. The first required payment can be made as late as the Required Beginning Date and must be the payment that is required for a single payment interval. The second payment need not be made until the end of the next payment interval.
The Annuitants interest in this annuity contract includes the amount of any outstanding rollover or transfer, and the actuarial value of any other benefits provided under the annuity contract, such as guaranteed death benefits, to the extent required by regulations.
For purposes of this provision, the Annuitants designated beneficiary is an individual designated under the Plan to receive payments after the Annuitants death and who qualifies as a designated beneficiary under Section 1.401(a)(9)-4 of the Income Tax Regulations.
REQUIRED MINIMUM DISTRIBUTIONS AFTER DEATH. If the Annuitant dies after required distributions begin, the remaining portion of the Annuitants interest in this annuity contract will continue to be distributed under the contract option chosen.
E6004405NW |
-3- |
If the Annuitant dies before required distributions begin, the Annuitants entire interest in this annuity contract will be distributed as least as rapidly as follows:
1) | If an individual other than the Annuitants surviving spouse is his or her designated beneficiary, then the Annuitants entire interest will be distributed over the remaining life expectancy of that individual, with payments starting by the end of the calendar year following the calendar year of the Annuitants death. The life expectancy of the designated beneficiary will be determined using his or her age as of his or her birthday in the year following the year of the Annuitants death. Alternatively, if elected, the Annuitants entire interest in this annuity contract will be distributed by the end of the calendar year that contains the fifth anniversary of the Annuitants death. |
2) | If the Annuitants surviving spouse is his or her sole designated beneficiary, then the Annuitants entire interest will be distributed over such spouses life, with payments starting by the end of the calendar year following the calendar year of the Annuitants death, or if later, by the end of the calendar year in which the Annuitant would have reached age 70-1/2. Alternatively, if elected, the Annuitants entire interest in this annuity contract will be distributed by the end of the calendar year that contains the fifth anniversary of the Annuitants death. |
If the Annuitants surviving spouse dies before required distributions begin to him or her, the remaining interest will be distributed over the remaining life expectancy of the spouses designated beneficiary, with payments starting by the end of the calendar year following the calendar year of the spouses death. The life expectancy of the spouses designated beneficiary will be determined using his or her age as of his or her birthday in the year following the death of the Annuitants spouse. Alternatively, if elected, the remaining interest in this annuity contract will be distributed by the end of the calendar year that contains the fifth anniversary of the surviving spouses death.
If the Annuitants surviving spouse dies after required distributions begin to him or her, any remaining interest will continue to be distributed under the contract option chosen.
3) | If there is no designated beneficiary, then the Annuitants entire interest in this annuity contract will be distributed by the end of the calendar year containing the fifth anniversary of the Annuitants death. |
Life expectancy is determined using the Single Life Table in Q&A-1 of Section 1.401(a)(9)-9 of the Income Tax Regulations. If distributions are being made to the Annuitants surviving spouse as the designated beneficiary, the spouses remaining life expectancy for a year is the number in the Single Life Table corresponding to such spouses age on his or her birthday in the year. In all other cases, remaining life expectancy for a year is the number in the Single Life Table in the year such individuals life expectancy is first determined, reduced by one (1) for each subsequent year.
Required distributions are considered to begin on the Required Beginning Date or, if applicable, on the date distributions are required to begin to a surviving spouse. However, if distributions under this annuity contract start prior to such date on an irrevocable basis (except for acceleration) in a form meeting the requirements of Section 1.401(a)(9)-6T of the Temporary Income Tax Regulations, then required distributions are considered to begin on the annuity starting date.
The Annuitants interest in this annuity contract includes the amount of any outstanding rollover or transfer, and the actuarial value of any other benefits provided under the annuity contract, such as guaranteed death benefits, to the extent required by regulations.
E6004405NW |
-4- |
For purposes of this provision, a designated beneficiary is an individual designated under this annuity contract to receive payments after the Annuitants death (or the death of the surviving spouse) and who qualifies as a designated beneficiary under Section 1.401(a)(9)-4 of the Income Tax Regulations.
This is part of the annuity contract. It is not a separate contract. It changes the annuity contract only as and to the extent stated. In all cases of conflict with the other terms of the annuity contract, the provisions of this Endorsement shall control.
Signed for us at our office as of the date of issue.
[ ] | [ ] | |
[MARK F. MUETHING] | [JOHN P. GRUBER] | |
[PRESIDENT] | [SECRETARY] |
E6004405NW |
-5- |
Exhibit 4(b)(9)
[ ]
Home Office: Cincinnati, Ohio
Fixed Administrative Office: [191 Rosa Parks Street, Cincinnati, Ohio 45202]
EMPLOYER PLAN
ENDORSEMENT
The annuity contract is changed as set out below to adapt it for use with an employee benefit plan:
PLAN. Plan means the employee benefit plan named on your application or any successor plan.
EMPLOYER. Employer means the employer sponsoring the Plan and named on your application, or any other employer which succeeds to its rights under the Plan.
PLAN ADMINISTRATOR. Plan Administrator means the person designated as such to us in writing by the Employer. If no person has been designated, Plan Administrator means the Employer.
PLAN INTERPRETATION. For purposes of this annuity contract, the Plan Administrator shall interpret the Plan and decide all questions about what is allowed or required by the Plan. We have no duty to review or interpret the Plan, or to review or approve any decision of the Plan Administrator. We are entitled to rely on the written directions of the Plan Administrator on such matters.
APPLICABLE RESTRICTIONS. This annuity contract may be restricted by federal and/or state laws related to employee benefit plans. We may change the terms of this annuity contract or administer this annuity contract at any time as needed to comply with such laws.
PLAN DISTRIBUTION PROVISIONS. Distributions allowed under this annuity contract may be made only at a time allowed by the Plan or required by this annuity contract. The form of any distribution shall be determined under the Plan from among those forms of distribution available under this annuity contract. No distribution may be made without the written direction of the Plan Administrator unless required by this annuity contract. Distributions may be made without your consent when required by the Plan.
FORFEITURE OF NON-VESTED AMOUNTS. Any amount under this annuity contract attributable to contributions by the Employer (excluding any contributions made under a salary reduction agreement with your employer) is subject to the vesting provisions of the Plan. If at any time the Plan provides for a forfeiture of an amount that is not vested, then such amount may be withdrawn and paid as directed by the Plan Administrator.
RETURN OF EXCESS CONTRIBUTIONS. Contributions made to this annuity contract for you are subject to any limits on contributions and nondiscrimination provisions of the Plan. If the Plan Administrator determines that excess or discriminatory contributions were made, then amounts attributable to such contributions may be withdrawn and paid as directed by the Plan Administrator.
ENTITLEMENT TO DEATH BENEFITS. The person or persons entitled to any amount remaining payable under this annuity contract after your death shall be determined under the Plan. No distribution of any such amount shall be made without the written direction of the Plan Administrator.
EPLAN(Rev. 2/98)-1 |
-1- | (Rev. 10/22) |
INVESTMENT ALLOCATIONS AND TRANSFERS. If this annuity contract provides that amounts held under it are allocated among separate investment funds or fixed accounts, then any such allocations and/or subsequent transfers shall be made only as required or allowed by the Plan, or as required by this annuity contract to secure a loan. No such allocation or transfer shall be made without the written direction of the Plan Administrator unless required by this annuity contract to secure a loan. Allocations or transfers may be made without your consent when required by the Plan or the annuity contract.
PLAN LOAN PROVISIONS. If loans are allowed under this annuity contract, no such loan may be made unless also allowed by the Plan. Any such loan will be subject to any additional limits and conditions which apply under the Plan. No loan may be made without the written direction of the Plan Administrator. The rate of interest to be paid by you on any such loan will be fixed by the Plan Administrator, but we may require that it be at least three percentage points higher than the minimum guaranteed rate of interest, if any, that applies to your interest in this annuity contract used as security for the loan.
QUALIFIED JOINT AND 50% SURVIVOR ANNUITY OPTION. In addition to the other payment options available under this annuity contract, payments may be made in the form of a Qualified Joint and 50% Survivor Annuity. Under this payment option, we will make equal payments to you for life at least once per year. If the person who is your spouse at the time payments commence survives you, then after your death we will make payments to such spouse at the same intervals equal to one-half of the amount of the prior payments, with such payments continuing to such spouse until his or her death. The first payment under this payment option will be made on the effective date of the payment option. The amount of the payments we will make under this payment option is based on the intervals for payments, which are subject to our approval. Amounts vary with the ages, as of the first payment date, of you and your spouse. We will require proof of the ages of you and your spouse. Monthly payments that we will make under this payment option for each $1,000 of proceeds applied will be furnished at your request. Once payments begin under this payment option, the value of future payments may not be withdrawn as a commutation of benefits.
This is a part of your annuity contract. It is not a separate contract. It changes the annuity contract only as and to the extent stated. In all cases of conflict with the other terms of the annuity contract, the provisions of this endorsement shall control.
Signed for us at our office as of the date of issue.
[ ] | [ ] | |
[MARK F. MUETHING] | [JOHN P. GRUBER] | |
[PRESIDENT] | [SECRETARY] |
EPLAN(Rev. 2/98)-1 |
-2- |
Exhibit 4(c)(17)
[ ]
Home Office: Cincinnati, Ohio
Administrative Office: [P.O. Box 5423, Cincinnati, Ohio 45201-5423]
FIRST TRUST BARCLAYS EDGE
1-YEAR
10% BUFFER WITH UPSIDE PARTICIPATION RATE
INDEXED STRATEGY
Crediting Strategy Endorsement
Index Loss Subject to a 10% Buffer for Each Term
Index Gain Subject to an Upside Participation Rate for Each Term
Performance Lock Feature
Term
Each Term for this Strategy is one year long.
Gain or Loss
Each day, the value of the Strategy includes the Gain or Loss for the Term.
Gain or Loss is calculated on the remaining investment base for the Term. For this purpose, the investment base starts with the amount applied to that Strategy at the start of the Term. It is then reduced to pay for each withdrawal or charge that is taken from the Strategy during the Term.
Gain or Loss at the End of a Term
After the final Market Close of a Term, unless you have elected a Performance Lock, any Gain or Loss is determined based on the increase or decrease in the First Trust Barclays Edge Index since the start of the Term. This increase or decrease is expressed as a percentage of the value of the First Trust Barclays Edge Index at the start of the Term. It is measured from the index value at the last Market Close on or before the first day of the Term to the index value at the final Market Close of the Term. The index value is the value of the First Trust Barclays Edge Index as published by [Barclays Bank PLC or its agent].
Any Gain for the Term is subject to the Upside Participation Rate. Any Loss for the Term is subject to the Buffer.
Gain or Loss before the End of a Term
Before the final Market Close of a Term, unless you have elected a Performance Lock, the Gain or Loss for the Term is a percentage equal to:
1) | the net option value for the Strategy as of the most recent Market Close of the Term; minus |
2) | the amortized option cost as of the most recent Market Close of the Term; and minus |
3) | Trading Cost. |
The net option value as of a Market Close is a percentage equal to:
1) | the value of the ATM Call Option at the Market Close, multiplied by the Upside Participation Rate; minus |
2) | the value of the OTM Put Option at the Market Close. |
E1849122NW |
1 |
The amortized option cost is a percentage equal to:
1) | the net option value for the Strategy at the beginning of the Term; multiplied by |
2) | the number of days remaining until the final Market Close of the Term divided by 365. |
Performance Lock
A Performance Lock is an election to lock in the Gain or Loss for the remainder of a Term. You may make a Performance Lock election for a Term by a Request in Good Order. Once we receive your Request in Good Order, a Performance Lock election for a Term cannot be changed or revoked.
A Performance Lock election for a Term is effective on the second Market Close following our receipt of your Request in Good Order. After the second Market Close, the Gain or Loss before the end of the Term and the Gain or Loss at the end of the Term is based on the net option value, amortized option cost, and Trading Cost as determined for that second Market Close.
ATM Call Option
The ATM Call Option is a hypothetical call option that will pay the holder an amount equal to the percentage increase, if any, in the First Trust Barclays Edge Index from the last Market Close on or before the start of the Term to the final Market Close of the Term.
OTM Put Option
The OTM Put Option is a hypothetical put option that will pay the holder an amount equal to the percentage decrease, if any, in the First Trust Barclays Edge Index from the last Market Close on or before the start of the Term to the final Market Close of the Term, but only to the extent the percentage decrease exceeds the Buffer for the Term.
Option Values
The ATM Call Option and OTM Put Option are valued by us using a market standard model for valuing an option. Each value is stated as a percentage of the option value at the last Market Close on or before the first day of the Term.
Upside Participation Rate
The Upside Participation Rate is the portion of the increase in the First Trust Barclays Edge Index for a Term taken into account to determine the Gain for the Term. We will set the Upside Participation Rate for each initial or renewal Term of this Strategy before the first day of that Term. For a given Term, we may set a different Upside Participation Rate for amounts attributable to Purchase Payments received on different dates.
Buffer
The Buffer is the decrease in the value of the First Trust Barclays Edge Index for a Term that is disregarded when determining the Loss for the Term. The Buffer for each Term of this Strategy is 10%.
Trading Cost
Trading Cost is the estimated cost of selling the hypothetical option before the end of a Term. It is a percentage set by us from time to time to reflect the average difference between the Option Values and market bid prices.
Market Close
A Market Close for this Strategy is the close of the core trading session of the New York Stock Exchange Arca on each day that is a Market Day.
Index Information
The First Trust Barclays Edge Index is a combination about 250 stocks selected by First Trust from its Capital Strength Index and Value Line® Dividend Index, 2, 5, and 10-year U.S. Treasuries to the extent indicated by a bond switch signal, an efficient frontier allocation to optimize long-term volatility and correlation, and a varying investment exposure to control volatility.
E1849122NW |
2 |
[The First Trust Barclays Edge Index (FTIS Index) is a product of FT Indexing Solutions LLC (FTIS) and is administered and calculated by Bloomberg Finance L.P. and its affiliates (collectively, Bloomberg). FIRST TRUST® is a trademark of First Trust Portfolios L.P. (collectively, with FTIS and their respective affiliates, First Trust). The foregoing index and trademark have been licensed for use for certain purposes by Barclays, Bloomberg, and MassMutual Ascend Life Insurance Company (MassMutual Ascend) in connection with the FTIS Index and [the Approved Product].
The Capital Strength Index (Nasdaq Index) is a product of Nasdaq, Inc. (collectively, with its affiliates, Nasdaq). NASDAQ®, CAPITAL STRENGTH INDEXTM, and NQCAPSTTM are trademarks of Nasdaq. The foregoing index and trademarks have been licensed for use for certain purposes by FTIS and MassMutual Ascend in connection with the FTIS Index and [the Approved Product].
The Value Line Dividend Index (Value Line Index) is a product of Value Line, Inc. (Value Line). VALUE LINE® and VALUE LINE DIVIDEND INDEXTM are trademarks or registered trademarks of Value Line. The foregoing index and trademarks have been licensed for use for certain purposes by FTIS and MassMutual Ascend in connection with the FTIS Index and [the Approved Product]. The FTIS Index is not sponsored, endorsed, recommended, sold or promoted by Value Line and Value Line makes no representation regarding the advisability of investing in the FTIS Index.
[The Approved Product] is not issued, sponsored, endorsed, sold, recommended, or promoted by First Trust, Bloomberg, Nasdaq, Value Line, or their respective affiliates (collectively, the Companies). Bloombergs relationship to First Trust and Barclays is only (1) in the licensing of the FIRST TRUST®, BARCLAYS®, and FIRST TRUST BARCLAYS EDGE INDEXTM trademarks and (2) to act as the administrator and calculation agent of the First Trust Barclays Edge Index. The Companies have not passed on the legality or suitability of, or the accuracy or adequacy of descriptions and disclosures relating to [the Approved Product]. The Companies make no representation or warranty, express or implied, to the owners of any product based on the FTIS Index, Barclays Indexes, Nasdaq Index, or Value Line Index, or to any member of the public regarding the advisability of investing in securities generally or in products based on the FTIS Index, Dow Index, Nasdaq Indices, or Value Line Index particularly, or the ability of the FTIS Index, Dow Index, Nasdaq Indices, or Value Line Index to track general stock market performance. The Companies only relationship to MassMutual Ascend is in the licensing of the certain trademarks, trade names, and service marks and the use of the FTIS Index, Dow lndex, Nasdaq Indices, and Value Line Indices, which are determined, composed and calculated without regard to MassMutual Ascend or [the Approved Product]. The Companies have no obligation to take the needs of MassMutual Ascend, or the owners of [the Approved Product], or the sponsors or owners of products based on the FTIS Index, Barclays Indexes, Nasdaq Index, or Value Line Index into consideration when determining, composing, or calculating the FTIS Index, Barclays Indexes, Nasdaq Index, and Value Line Index. The Companies are not responsible for and have not participated in the determination or calculation of [the Approved Product]. There is no assurances from the Companies that products based on the FTIS Index, Barclays Indexes, Nasdaq Index, or Value Line Index will accurately track index performance or provide positive investment returns. The Companies are not investment advisors. Inclusion of a security or financial instrument within an index is not a recommendation by the Companies to buy, sell, or hold such security or financial instrument, nor is it considered to be investment advice.
E1849122NW |
3 |
THE COMPANIES DO NOT GUARANTEE THE ADEQUACY, ACCURACY, TIMELINESS, COMPLETENESS, AND/OR UNINTERRUPTED CALCULATION OF [THE APPROVED PRODUCT], FTIS INDEX, BARCLAYS INDEXES, NASDAQ INDEX, VALUE LINE INDEX, OR ANY DATA INCLUDED THEREIN OR ANY COMMUNICATION WITH RESPECT THERETO, INCLUDING, ORAL, WRITTEN, OR ELECTRONIC COMMUNICATIONS. THE COMPANIES SHALL HAVE NO LIABILITY FOR ANY ERRORS, OMISSIONS, OR INTERRUPTIONS IN [THE APPROVED PRODUCT], FTIS INDEX, BARCLAYS INDEXES, NASDAQ INDEX, OR VALUE LINE INDEX. THE COMPANIES MAKE NO WARRANTY, EXPRESS OR IMPLIED, AS TO THE RESULTS TO BE OBTAINED BY OWNERS OF [THE APPROVED PRODUCT] OR OF PRODUCTS BASED ON THE FTIS INDEX, BARCLAYS INDEXES, NASDAQ INDEX, OR VALUE LINE INDEX, OR BY ANY OTHER PERSON OR ENTITY FROM THE USE OF THE FTIS INDEX, BARCLAYS INDEXES, NASDAQ INDEX, OR VALUE LINE INDEX, OR ANY DATA INCLUDED THEREIN. THE COMPANIES MAKE NO EXPRESS OR IMPLIED WARRANTIES, AND EXPRESSLY DISCLAIM ALL WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE WITH RESPECT TO [THE APPROVED PRODUCT], FTIS INDEX, BARCLAYS INDEXES, NASDAQ INDEX, VALUE LINE INDEX, OR ANY DATA INCLUDED THEREIN. WITHOUT LIMITING ANY OF THE FOREGOING, IN NO EVENT SHALL THE COMPANIES BE SUBJECT TO ANY DAMAGES OR HAVE ANY LIABILITY FOR ANY INDIRECT, SPECIAL, INCIDENTAL, PUNITIVE, INDIRECT, OR CONSEQUENTIAL DAMAGES OR LOSSES, INCLUDING BUT NOT LIMITED TO, LOSS OF PROFITS, TRADING LOSSES, LOST TIME, OR GOODWILL, EVEN IF NOTIFIED OF THE POSSIBILITY OF SUCH DAMAGES, WHETHER IN CONTRACT, TORT, STRICT LIABILITY, OR OTHERWISE. THERE ARE NO THIRD PARTY BENEFICIARIES OF ANY AGREEMENTS OR ARRANGEMENTS BETWEEN MASSMUTUAL ASCEND AND THE COMPANIES.
Neither Barclays Bank PLC (BB PLC) nor any of its affiliates (collectively Barclays) is the issuer or producer of [the Approved Product(s)] and Barclays has no responsibilities, obligations or duties to investors in [the Approved Product(s)]. The Barclays US 2Y Treasury Futures Index, Barclays US 5Y Treasury Futures Index, Barclays US 10Y Treasury Futures Index, and Barclays US 30Y Treasury Futures Index (collectively, the Indices), together with any Barclays indices that are components of the Indices, are trademarks owned by Barclays and, together with any component indices and index data, are licensed for use by MassMutual Ascend as the issuer or producer of [the Approved Product(s)] (the Issuer).
Barclays only relationship with the Issuer in respect of the Indices is the licensing of the Indices, which are administered, compiled and published by BB PLC in its role as the index sponsor (the Index Sponsor) without regard to the Issuer or the [Approved Product(s)] or investors in the [Approved Product(s)]. Additionally, MassMutual Ascend as issuer or producer of [the Approved Product(s)] may for itself execute transaction(s) with Barclays in or relating to the Indices in connection with [the Approved Product(s)]. Investors acquire [the Approved Product(s)] from MassMutual Ascend and investors neither acquire any interest in the Indices nor enter into any relationship of any kind whatsoever with Barclays upon making an investment in [the Approved Product(s)]. The [Approved Product(s)] is not sponsored, endorsed, sold or promoted by Barclays and Barclays makes no representation regarding the advisability of the [Approved Product(s)] or use of the Indices or any data included therein. Barclays shall not be liable in any way to the Issuer, investors or to other third parties in respect of the use or accuracy of the Indices or any data included therein.
E1849122NW |
4 |
Barclays Index Administration (BINDA), a distinct function within BB PLC, is responsible for day-to-day governance of BB PLCs activities as Index Sponsor.
To protect the integrity of Barclays indices, BB PLC has in place a control framework designed to identify and remove and/or mitigate (as appropriate) conflicts of interest. Within the control framework, BINDA has the following specific responsibilities:
| oversight of any third party index calculation agent; |
| acting as approvals body for index lifecycle events (index launch, change and retirement); and |
| resolving unforeseen index calculation issues where discretion or interpretation may be required (for example: upon the occurrence of market disruption events). |
To promote the independence of BINDA, the function is operationally separate from BB PLCs sales, trading and structuring desks, investment managers, and other business units that have, or may be perceived to have, interests that may conflict with the independence or integrity of Barclays indices.
Notwithstanding the foregoing, potential conflicts of interest exist as a consequence of BB PLC providing indices alongside its other businesses. Please note the following in relation to Barclays indices:
| BB PLC may act in multiple capacities with respect to a particular index including, but not limited to, functioning as index sponsor, index administrator, index owner and licensor. |
| Sales, trading or structuring desks in BB PLC may launch products linked to the performance of a index. These products are typically hedged by BB PLCs trading desks. In hedging an index, a trading desk may purchase or sell constituents of that index. These purchases or sales may affect the prices of the index constituents which could in turn affect the level of that index. |
| BB PLC may establish investment funds that track an index or otherwise use an index for portfolio or asset allocation decisions. |
The Index Sponsor is under no obligation to continue the administration, compilation and publication of the Indices or the level of the Indices. While the Index Sponsor currently employs the methodology ascribed to the Indices (and application of such methodology shall be conclusive and binding), no assurance can be given that market, regulatory, juridical, financial, fiscal or other circumstances (including, but not limited to, any changes to or any suspension or termination of or any other events affecting any constituent within the Index) will not arise that would, in the view of the Index Sponsor, necessitate an adjustment, modification or change of such methodology. In certain circumstances, the Index Sponsor may suspend or terminate the Indices. The Index Sponsor has appointed a third-party agent (the Index Calculation Agent) to calculate and maintain the Indices. While the Index Sponsor is responsible for the operation of the Indices, certain aspects have thus been outsourced to the Index Calculation Agent.
Barclays
1) | makes no representation or warranty, express or implied, to the Issuer or any member of the public regarding the advisability of investing in transactions generally or the ability of the Indices to track the performance of any market or underlying assets or data; and |
2) | has no obligation to take the needs of the Issuer into consideration in administering, compiling or publishing the Indices. |
E1849122NW |
5 |
Barclays has no obligation or liability in connection with administration, marketing or trading of the [Approved Product(s)].
The licensing agreement between MassMutual Ascend and BB PLC is solely for the benefit of MassMutual Ascend and Barclays and not for the benefit of the owners of the [Approved Product(s)], investors or other third parties.
BARCLAYS DOES NOT GUARANTEE, AND SHALL HAVE NO LIABILITY TO THE PURCHASERS AND TRADERS, AS THE CASE MAY BE, OF THE TRANSACTION OR TO THIRD PARTIES FOR THE QUALITY, ACCURACY AND/OR COMPLETENESS OF THE INDICES OR ANY DATA INCLUDED THEREIN OR FOR INTERRUPTIONS IN THE DELIVERY OF THE INDICES. BARCLAYS MAKES NO EXPRESS OR IMPLIED WARRANTIES, AND HEREBY EXPRESSLY DISCLAIMS ALL WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE WITH RESPECT TO THE INDICES INCLUDING, WITHOUT LIMITATION, THE INDICES, OR ANY DATA INCLUDED THEREIN. IN NO EVENT SHALL BARCLAYS HAVE ANY LIABILITY FOR ANY SPECIAL, PUNITIVE, INDIRECT, OR CONSEQUENTIAL DAMAGES, OR ANY LOST PROFITS, EVEN IF NOTIFIED OF THE POSSIBLITY OF SUCH DAMAGES SAVE TO THE EXTENT THAT SUCH EXCLUSION OF LIABILITY IS PROHIBITED BY LAW.
None of the information supplied by Barclays and used in this publication may be reproduced in any manner without the prior written permission of Barclays Bank PLC. Barclays Bank PLC is registered in England No. 1026167. Registered office 1 Churchill Place London E14 5HP.
Bloomberg Index Services Limited is the official index calculation and maintenance agent of the Index, an index owned and administered by Barclays. Bloomberg Index Services Limited does not guarantee the timeliness, accurateness, or completeness of the Index calculations or any data or information relating to the Index. Bloomberg Index Services Limited makes no warranty, express or implied, as to the Index or any data or values relating thereto or results to be obtained therefrom, and expressly disclaims all warranties of merchantability and fitness for a particular purpose with respect thereto. To the maximum extent allowed by law, Bloomberg Index Services Limited, its affiliates, and all of their respective partners, employees, subcontractors, agents, suppliers and vendors (collectively, the protected parties) shall have no liability or responsibility, contingent or otherwise, for any injury or damages, whether caused by the negligence of a protected party or otherwise, arising in connection with the calculation of the Index or any data or values included therein or in connection therewith and shall not be liable for any lost profits, losses, punitive, incidental or consequential damages.]
GAIN OR LOSS UNDER THIS CREDITING STRATEGY IS DETERMINED IN PART BASED ON THE FIRST TRUST BARCLAYS EDGE INDEX. HOWEVER, THIS CONTRACT DOES NOT DIRECTLY PARTICIPATE IN ANY EQUITY OR BOND INVESTMENTS.
E1849122NW |
6 |
This is part of your Contract. It is not a separate contract. It changes the Contract only as and to the extent stated. In all cases of conflict with the other terms of the Contract, the provisions of this Endorsement shall control.
Signed for us at our office as of the Contract Effective Date.
[ ] | [ ] | |
[Mark F. Muething] | [John P. Gruber] | |
[President] | [Secretary] |
E1849122NW |
7 |
Exhibit 4(c)(18)
[ ]
Home Office: Cincinnati, Ohio
Administrative Office: [P.O. Box 5423, Cincinnati, Ohio 45201-5423]
FIRST TRUST BARCLAYS EDGE
1-YEAR
50% DOWNSIDE PARTICIPATION RATE
WITH UPSIDE PARTICIPATION RATE
INDEXED STRATEGY
Crediting Strategy Endorsement
Index Loss Subject to a 50% Downside Participation Rate for Each Term
Index Gain Subject to an Upside Participation Rate for Each Term
Performance Lock Feature
Term
Each Term for this Strategy is one year long.
Gain or Loss
Each day, the value of the Strategy includes the Gain or Loss for the Term.
Gain or Loss is calculated on the remaining investment base for the current Term. For this purpose, the investment base starts with the amount applied to that Strategy at the start of the current Term. It is then reduced to pay for each withdrawal or charge that is taken from the Strategy during the current Term.
Gain or Loss at the End of a Term
After the final Market Close of a Term, unless you have elected a Performance Lock, any Gain or Loss is determined based on the increase or decrease in the First Trust Barclays Edge Index since the start of the Term. This increase or decrease is expressed as a percentage of the value of the First Trust Barclays Edge Index at the start of the Term. It is measured from the index value at the last Market Close on or before the first day of the Term to the index value at the final Market Close of the Term. The index value is the value of the First Trust Barclays Edge Index published by [Barclays Bank PLC or its agent].
Any Gain for the Term is subject to the Upside Participation Rate. Any Loss for the Term is subject to the Downside Participation Rate.
Gain or Loss before the End of a Term
1) | Before the final Market Close of a Term, unless you have elected a Performance Lock, the Gain or Loss for the Term is a percentage equal to: |
2) | the net option value for the Strategy as of the most recent Market Close of the Term; minus |
3) | the amortized option cost as of the most recent Market Close of the Term; and minus |
4) | Trading Cost. |
E1849222NW |
1 |
The net option value as of a Market Close is a percentage equal to:
1) | the value of the ATM Call Option at the Market Close, multiplied by the Upside Participation Rate; minus |
2) | the value of the ATM Put Option at the Market Close, multiplied by the Downside Participation Rate. |
The amortized option cost is a percentage equal to:
1) | the net option value for the Strategy at the start of the Term; multiplied by |
2) | the number of days remaining until the final Market Close of the Term divided by 365. |
Performance Lock
A Performance Lock is an election to lock in the Gain or Loss for the remainder of a Term. You may make a Performance Lock election for a Term by a Request in Good Order. Once we receive your Request in Good Order, a Performance Lock election for a Term cannot be changed or revoked.
A Performance Lock election for a Term is effective on the second Market Close following our receipt of your Request in Good Order. After the second Market Close, the Gain or Loss before the end of the Term and the Gain or Loss at the end of the Term is based on the net option value, amortized option cost, and Trading Cost as determined for that second Market Close.
ATM Call Option
The ATM Call Option is a hypothetical call option that will pay the holder an amount equal to the percentage increase, if any, in the First Trust Barclays Edge Index from the last Market Close on or before the start of the Term to the final Market Close of the Term.
ATM Put Option
The ATM Put Option is a hypothetical put option that will pay the holder an amount equal to the percentage decrease, if any, in the First Trust Barclays Edge Index from the last Market Close on or before the start of the Term to the final Market Close of the Term.
Option Values
The ATM Call Option and ATM Put Option are valued by us using a market standard model for valuing an option. Each value is stated as a percentage of the First Trust Barclays Edge Index at the last Market Close on or before the first day of the Term.
Upside Participation Rate
The Upside Participation Rate is the portion of the increase in the First Trust Barclays Edge Index for a Term taken into account to determine the Gain for the Term. We will set the Upside Participation Rate for each initial or renewal Term of this Strategy before the first day of that Term. For a given Term, we may set a different Upside Participation Rate for amounts attributable to Purchase Payments received on different dates.
Downside Participation Rate
The Downside Participation Rate is the portion of the decrease in the First Trust Barclays Edge Index for a Term taken into account to determine the Loss for the Term. The Downside Participation Rate for each Term of this Strategy is [50%].
Trading Cost
Trading Cost is the estimated cost of selling the hypothetical option before the end of a Term. It is a percentage set by us from time to time to reflect the average difference between the Option Values and market bid prices.
E1849222NW |
2 |
Market Close
A Market Close for this Strategy is the close of regular trading on the New York Stock Exchange on each day that is a Market Day.
Index Information
The First Trust Barclays Edge Index is a combination about 250 stocks selected by First Trust from its Capital Strength Index and Value Line® Dividend Index, 2, 5, and 10-year U.S. Treasuries to the extent indicated by a bond switch signal, an efficient frontier allocation to optimize long-term volatility and correlation, and a varying investment exposure to control volatility.
[The First Trust Barclays Edge Index (FTIS Index) is a product of FT Indexing Solutions LLC (FTIS) and is administered and calculated by Bloomberg Finance L.P. and its affiliates (collectively, Bloomberg). FIRST TRUST® is a trademark of First Trust Portfolios L.P. (collectively, with FTIS and their respective affiliates, First Trust). The foregoing index and trademark have been licensed for use for certain purposes by Barclays, Bloomberg, and MassMutual Ascend Life Insurance Company (MassMutual Ascend) in connection with the FTIS Index and [the Approved Product].
The Capital Strength Index (Nasdaq Index) is a product of Nasdaq, Inc. (collectively, with its affiliates, Nasdaq). NASDAQ®, CAPITAL STRENGTH INDEXTM, and NQCAPSTTM are trademarks of Nasdaq. The foregoing index and trademarks have been licensed for use for certain purposes by FTIS and MassMutual Ascend in connection with the FTIS Index and [the Approved Product].
The Value Line Dividend Index (Value Line Index) is a product of Value Line, Inc. (Value Line). VALUE LINE® and VALUE LINE DIVIDEND INDEXTM are trademarks or registered trademarks of Value Line. The foregoing index and trademarks have been licensed for use for certain purposes by FTIS and MassMutual Ascend in connection with the FTIS Index and [the Approved Product]. The FTIS Index is not sponsored, endorsed, recommended, sold or promoted by Value Line and Value Line makes no representation regarding the advisability of investing in the FTIS Index.
[The Approved Product] is not issued, sponsored, endorsed, sold, recommended, or promoted by First Trust, Bloomberg, Nasdaq, Value Line, or their respective affiliates (collectively, the Companies). Bloombergs relationship to First Trust and Barclays is only (1) in the licensing of the FIRST TRUST®, BARCLAYS®, and FIRST TRUST BARCLAYS EDGE INDEXTM trademarks and (2) to act as the administrator and calculation agent of the First Trust Barclays Edge Index. The Companies have not passed on the legality or suitability of, or the accuracy or adequacy of descriptions and disclosures relating to [the Approved Product]. The Companies make no representation or warranty, express or implied, to the owners of any product based on the FTIS Index, Barclays Indexes, Nasdaq Index, or Value Line Index, or to any member of the public regarding the advisability of investing in securities generally or in products based on the FTIS Index, Dow Index, Nasdaq Indices, or Value Line Index particularly, or the ability of the FTIS
Index, Dow Index, Nasdaq Indices, or Value Line Index to track general stock market performance. The Companies only relationship to MassMutual Ascend is in the licensing of the certain trademarks, trade names, and service marks and the use of the FTIS Index, Dow lndex, Nasdaq Indices, and Value Line Indices, which are determined, composed and calculated without regard to MassMutual Ascend or [the Approved Product]. The Companies have no obligation to take the needs of MassMutual Ascend, or the owners of [the Approved Product], or the sponsors or owners of products based on the FTIS Index, Barclays Indexes, Nasdaq Index, or Value Line Index into consideration when determining, composing, or calculating the FTIS Index, Barclays Indexes, Nasdaq Index, and Value Line Index. The Companies are not responsible for and have not participated in the determination or calculation of [the Approved Product]. There is no assurances from the Companies that products based on the FTIS Index, Barclays Indexes, Nasdaq Index, or Value Line Index will accurately track index performance or provide positive investment returns. The Companies are not investment advisors. Inclusion of a security or financial instrument within an index is not a recommendation by the Companies to buy, sell, or hold such security or financial instrument, nor is it considered to be investment advice.
E1849222NW |
3 |
THE COMPANIES DO NOT GUARANTEE THE ADEQUACY, ACCURACY, TIMELINESS, COMPLETENESS, AND/OR UNINTERRUPTED CALCULATION OF [THE APPROVED PRODUCT], FTIS INDEX, BARCLAYS INDEXES, NASDAQ INDEX, VALUE LINE INDEX, OR ANY DATA INCLUDED THEREIN OR ANY COMMUNICATION WITH RESPECT THERETO, INCLUDING, ORAL, WRITTEN, OR ELECTRONIC COMMUNICATIONS. THE COMPANIES SHALL HAVE NO LIABILITY FOR ANY ERRORS, OMISSIONS, OR INTERRUPTIONS IN [THE APPROVED PRODUCT], FTIS INDEX, BARCLAYS INDEXES, NASDAQ INDEX, OR VALUE LINE INDEX. THE COMPANIES MAKE NO WARRANTY, EXPRESS OR IMPLIED, AS TO THE RESULTS TO BE OBTAINED BY OWNERS OF [THE APPROVED PRODUCT] OR OF PRODUCTS BASED ON THE FTIS INDEX, BARCLAYS INDEXES, NASDAQ INDEX, OR VALUE LINE INDEX, OR BY ANY OTHER PERSON OR ENTITY FROM THE USE OF THE FTIS INDEX, BARCLAYS INDEXES, NASDAQ INDEX, OR VALUE LINE INDEX, OR ANY DATA INCLUDED THEREIN. THE COMPANIES MAKE NO EXPRESS OR IMPLIED WARRANTIES, AND EXPRESSLY DISCLAIM ALL WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE WITH RESPECT TO [THE APPROVED PRODUCT], FTIS INDEX, BARCLAYS INDEXES, NASDAQ INDEX, VALUE LINE INDEX, OR ANY DATA INCLUDED THEREIN. WITHOUT LIMITING ANY OF THE FOREGOING, IN NO EVENT SHALL THE COMPANIES BE SUBJECT TO ANY DAMAGES OR HAVE ANY LIABILITY FOR ANY INDIRECT, SPECIAL, INCIDENTAL, PUNITIVE, INDIRECT, OR CONSEQUENTIAL DAMAGES OR LOSSES, INCLUDING BUT NOT LIMITED TO, LOSS OF PROFITS, TRADING LOSSES, LOST TIME, OR GOODWILL, EVEN IF NOTIFIED OF THE POSSIBILITY OF SUCH DAMAGES, WHETHER IN CONTRACT, TORT, STRICT LIABILITY, OR OTHERWISE. THERE ARE NO THIRD PARTY BENEFICIARIES OF ANY AGREEMENTS OR ARRANGEMENTS BETWEEN MASSMUTUAL ASCEND AND THE COMPANIES.
Neither Barclays Bank PLC (BB PLC) nor any of its affiliates (collectively Barclays) is the issuer or producer of [the Approved Product(s)] and Barclays has no responsibilities, obligations or duties to investors in [the Approved Product(s)]. The Barclays US 2Y Treasury Futures Index, Barclays US 5Y Treasury Futures Index, Barclays US 10Y Treasury Futures Index, and Barclays US 30Y Treasury Futures Index (collectively, the Indices), together with any Barclays indices that are components of the Indices, are trademarks owned by Barclays and, together with any component indices and index data, are licensed for use by MassMutual Ascend as the issuer or producer of [the Approved Product(s)] (the Issuer).
Barclays only relationship with the Issuer in respect of the Indices is the licensing of the Indices, which are administered, compiled and published by BB PLC in its role as the index sponsor (the Index Sponsor) without regard to the Issuer or the [Approved Product(s)] or investors in the [Approved Product(s)]. Additionally, MassMutual Ascend as issuer or producer of [the Approved Product(s)] may for itself execute transaction(s) with Barclays in or relating to the Indices in connection with [the Approved Product(s)]. Investors acquire [the Approved Product(s)] from MassMutual Ascend and investors neither acquire any interest in the Indices nor enter into any relationship of any kind whatsoever with Barclays upon making an investment in [the Approved Product(s)]. The [Approved Product(s)] is not sponsored, endorsed, sold or promoted by Barclays and Barclays makes no representation regarding the advisability of the [Approved Product(s)] or use of the Indices or any data included therein. Barclays shall not be liable in any way to the Issuer, investors or to other third parties in respect of the use or accuracy of the Indices or any data included therein.
E1849222NW |
4 |
Barclays Index Administration (BINDA), a distinct function within BB PLC, is responsible for day-to-day governance of BB PLCs activities as Index Sponsor.
To protect the integrity of Barclays indices, BB PLC has in place a control framework designed to identify and remove and/or mitigate (as appropriate) conflicts of interest. Within the control framework, BINDA has the following specific responsibilities:
| oversight of any third party index calculation agent; |
| acting as approvals body for index lifecycle events (index launch, change and retirement); and |
| resolving unforeseen index calculation issues where discretion or interpretation may be required (for example: upon the occurrence of market disruption events). |
To promote the independence of BINDA, the function is operationally separate from BB PLCs sales, trading and structuring desks, investment managers, and other business units that have, or may be perceived to have, interests that may conflict with the independence or integrity of Barclays indices.
Notwithstanding the foregoing, potential conflicts of interest exist as a consequence of BB PLC providing indices alongside its other businesses. Please note the following in relation to Barclays indices:
| BB PLC may act in multiple capacities with respect to a particular index including, but not limited to, functioning as index sponsor, index administrator, index owner and licensor. |
| Sales, trading or structuring desks in BB PLC may launch products linked to the performance of a index. These products are typically hedged by BB PLCs trading desks. In hedging an index, a trading desk may purchase or sell constituents of that index. These purchases or sales may affect the prices of the index constituents which could in turn affect the level of that index. |
| BB PLC may establish investment funds that track an index or otherwise use an index for portfolio or asset allocation decisions. |
The Index Sponsor is under no obligation to continue the administration, compilation and publication of the Indices or the level of the Indices. While the Index Sponsor currently employs the methodology ascribed to the Indices (and application of such methodology shall be conclusive and binding), no assurance can be given that market, regulatory, juridical, financial, fiscal or other circumstances (including, but not limited to, any changes to or any suspension or termination of or any other events affecting any constituent within the Index) will not arise that would, in the view of the Index Sponsor, necessitate an adjustment, modification or change of such methodology. In certain circumstances, the Index Sponsor may suspend or terminate the Indices. The Index Sponsor has appointed a third-party agent (the Index Calculation Agent) to calculate and maintain the Indices. While the Index Sponsor is responsible for the operation of the Indices, certain aspects have thus been outsourced to the Index Calculation Agent.
Barclays
1) | makes no representation or warranty, express or implied, to the Issuer or any member of the public regarding the advisability of investing in transactions generally or the ability of the Indices to track the performance of any market or underlying assets or data; and |
2) | has no obligation to take the needs of the Issuer into consideration in administering, compiling or publishing the Indices. |
E1849222NW |
5 |
Barclays has no obligation or liability in connection with administration, marketing or trading of the [Approved Product(s)].
The licensing agreement between MassMutual Ascend and BB PLC is solely for the benefit of MassMutual Ascend and Barclays and not for the benefit of the owners of the [Approved Product(s)], investors or other third parties.
BARCLAYS DOES NOT GUARANTEE, AND SHALL HAVE NO LIABILITY TO THE PURCHASERS AND TRADERS, AS THE CASE MAY BE, OF THE TRANSACTION OR TO THIRD PARTIES FOR THE QUALITY, ACCURACY AND/OR COMPLETENESS OF THE INDICES OR ANY DATA INCLUDED THEREIN OR FOR INTERRUPTIONS IN THE DELIVERY OF THE INDICES. BARCLAYS MAKES NO EXPRESS OR IMPLIED WARRANTIES, AND HEREBY EXPRESSLY DISCLAIMS ALL WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE WITH RESPECT TO THE INDICES INCLUDING, WITHOUT LIMITATION, THE INDICES, OR ANY DATA INCLUDED THEREIN. IN NO EVENT SHALL BARCLAYS HAVE ANY LIABILITY FOR ANY SPECIAL, PUNITIVE, INDIRECT, OR CONSEQUENTIAL DAMAGES, OR ANY LOST PROFITS, EVEN IF NOTIFIED OF THE POSSIBLITY OF SUCH DAMAGES SAVE TO THE EXTENT THAT SUCH EXCLUSION OF LIABILITY IS PROHIBITED BY LAW.
None of the information supplied by Barclays and used in this publication may be reproduced in any manner without the prior written permission of Barclays Bank PLC. Barclays Bank PLC is registered in England No. 1026167. Registered office 1 Churchill Place London E14 5HP.
Bloomberg Index Services Limited is the official index calculation and maintenance agent of the Index, an index owned and administered by Barclays. Bloomberg Index Services Limited does not guarantee the timeliness, accurateness, or completeness of the Index calculations or any data or information relating to the Index. Bloomberg Index Services Limited makes no warranty, express or implied, as to the Index or any data or values relating thereto or results to be obtained therefrom, and expressly disclaims all warranties of merchantability and fitness for a particular purpose with respect thereto. To the maximum extent allowed by law, Bloomberg Index Services Limited, its affiliates, and all of their respective partners, employees, subcontractors, agents, suppliers and vendors (collectively, the protected parties) shall have no liability or responsibility, contingent or otherwise, for any injury or damages, whether caused by the negligence of a protected party or otherwise, arising in connection with the calculation of the Index or any data or values included therein or in connection therewith and shall not be liable for any lost profits, losses, punitive, incidental or consequential damages.]
GAIN OR LOSS UNDER THIS CREDITING STRATEGY IS DETERMINED IN PART BASED ON THE FIRST TRUST BARCLAYS EDGE INDEX. HOWEVER, THIS CONTRACT DOES NOT DIRECTLY PARTICIPATE IN ANY EQUITY OR BOND INVESTMENTS.
E1849222NW |
6 |
This is part of your Contract. It is not a separate contract. It changes the Contract only as and to the extent stated. In all cases of conflict with the other terms of the Contract, the provisions of this Endorsement shall control.
Signed for us at our office as of the Contract Effective Date.
[ ] |
[ ] | |
[Mark F. Muething] | [John P. Gruber] | |
[President] | [Secretary] |
E1849222NW |
7 |
Exhibit 24(a)
POWER OF ATTORNEY: RILA PRODUCT FILINGS
The Undersigned, Dominic L. Blue, director of MassMutual Ascend Life Insurance Company (MMALIC), appoints John Gruber, General Counsel of MMALIC, and all persons succeeding him in the capacity of General Counsel, Mark Muething, President of MMALIC, and John Domaschko, Divisional Assistant Vice President, Legal (collectively referred to hereafter as Attorneys), as the Undersigneds true and lawful attorneys and agents, each with full power to act individually.
This Power of Attorney authorizes each such Attorney (a) to sign and cause to be filed registration statements of MMALIC under the Securities Act of 1933 for each of the MMALIC Contract Categories listed in the chart below, and all amendments, consents and exhibits thereto; (b) to withdraw such statements or any amendments or exhibits and make requests for acceleration in connection therewith; (c) to take all other action of whatever kind or nature in connection with such registration statements which said attorneys may deem advisable; and (d) to make, file, execute, amend and withdraw documents of every kind, and to take other action of whatever kind they may elect, for the purpose of complying with the laws of any state relating to the sale of securities of MMALIC, the Securities Act of 1933, and any rule, regulation, order or other requirement of the Securities and Exchange Commission, hereby ratifying and confirming all actions of said attorney and agent hereunder.
MMALIC Contract Categories |
Index Frontier Contracts |
Index Summit 6 Contracts |
Index Frontier Pro Contracts |
Index Summit 6 Pro Contracts |
Index Achiever Contracts |
New Registered Indexed Linked Annuity contract (Name TBD), to be filed by January 2023 |
This Power of Attorney hereby revokes any powers of attorney previously given by the Undersigned relating to the MMALIC registration statements listed above, provided that this revocation shall not affect the exercise of such power prior to the date hereof. This Power of Attorney shall not be affected by subsequent disability or incapacity of the Undersigned.
The Undersigned has set his hand this 15th day of December, 2022, in the City of Springfield, State of Massachusetts.
/s/ Dominic L. Blue |
Dominic L. Blue, Director |
Exhibit 24(b)
POWER OF ATTORNEY: RILA PRODUCT FILINGS
The Undersigned, Susan M. Cicco, director of MassMutual Ascend Life Insurance Company (MMALIC), appoints John Gruber, General Counsel of MMALIC, and all persons succeeding him in the capacity of General Counsel, Mark Muething, President of MMALIC, and John Domaschko, Divisional Assistant Vice President, Legal (collectively referred to hereafter as Attorneys), as the Undersigneds true and lawful attorneys and agents, each with full power to act individually.
This Power of Attorney authorizes each such Attorney (a) to sign and cause to be filed registration statements of MMALIC under the Securities Act of 1933 for each of the MMALIC Contract Categories listed in the chart below, and all amendments, consents and exhibits thereto; (b) to withdraw such statements or any amendments or exhibits and make requests for acceleration in connection therewith; (c) to take all other action of whatever kind or nature in connection with such registration statements which said attorneys may deem advisable; and (d) to make, file, execute, amend and withdraw documents of every kind, and to take other action of whatever kind they may elect, for the purpose of complying with the laws of any state relating to the sale of securities of MMALIC, the Securities Act of 1933, and any rule, regulation, order or other requirement of the Securities and Exchange Commission, hereby ratifying and confirming all actions of said attorney and agent hereunder.
MMALIC Contract Categories |
Index Frontier Contracts |
Index Summit 6 Contracts |
Index Frontier Pro Contracts |
Index Summit 6 Pro Contracts |
Index Achiever Contracts |
New Registered Indexed Linked Annuity contract (Name TBD), to be filed by January 2023 |
This Power of Attorney hereby revokes any powers of attorney previously given by the Undersigned relating to the MMALIC registration statements listed above, provided that this revocation shall not affect the exercise of such power prior to the date hereof. This Power of Attorney shall not be affected by subsequent disability or incapacity of the Undersigned.
The Undersigned has set her hand this 13th day of December, 2022, in the City of Boston, State of Massachusetts.
/s/ Susan M. Cicco |
Susan M. Cicco, Director |
Exhibit 24(c)
POWER OF ATTORNEY: RILA PRODUCT FILINGS
The Undersigned, Geoffrey J. Craddock, director of MassMutual Ascend Life Insurance Company (MMALIC), appoints John Gruber, General Counsel of MMALIC, and all persons succeeding him in the capacity of General Counsel, Mark Muething, President of MMALIC, and John Domaschko, Divisional Assistant Vice President, Legal (collectively referred to hereafter as Attorneys), as the Undersigneds true and lawful attorneys and agents, each with full power to act individually.
This Power of Attorney authorizes each such Attorney (a) to sign and cause to be filed registration statements of MMALIC under the Securities Act of 1933 for each of the MMALIC Contract Categories listed in the chart below, and all amendments, consents and exhibits thereto; (b) to withdraw such statements or any amendments or exhibits and make requests for acceleration in connection therewith; (c) to take all other action of whatever kind or nature in connection with such registration statements which said attorneys may deem advisable; and (d) to make, file, execute, amend and withdraw documents of every kind, and to take other action of whatever kind they may elect, for the purpose of complying with the laws of any state relating to the sale of securities of MMALIC, the Securities Act of 1933, and any rule, regulation, order or other requirement of the Securities and Exchange Commission, hereby ratifying and confirming all actions of said attorney and agent hereunder.
MMALIC Contract Categories |
Index Frontier Contracts |
Index Summit 6 Contracts |
Index Frontier Pro Contracts |
Index Summit 6 Pro Contracts |
Index Achiever Contracts |
New Registered Indexed Linked Annuity contract (Name TBD), to be filed by January 2023 |
This Power of Attorney hereby revokes any powers of attorney previously given by the Undersigned relating to the MMALIC registration statements listed above, provided that this revocation shall not affect the exercise of such power prior to the date hereof. This Power of Attorney shall not be affected by subsequent disability or incapacity of the Undersigned.
The Undersigned has set his hand this 12th day of December, 2022, in the City of Boston, State of Massachusetts.
/s/ Geoffrey J. Craddock |
Geoffrey J. Craddock, Director |
Exhibit 24(d)
POWER OF ATTORNEY: RILA PRODUCT FILINGS
The Undersigned, Roger W. Crandall, director of MassMutual Ascend Life Insurance Company (MMALIC), appoints John Gruber, General Counsel of MMALIC, and all persons succeeding him in the capacity of General Counsel, Mark Muething, President of MMALIC, and John Domaschko, Divisional Assistant Vice President, Legal (collectively referred to hereafter as Attorneys), as the Undersigneds true and lawful attorneys and agents, each with full power to act individually.
This Power of Attorney authorizes each such Attorney (a) to sign and cause to be filed registration statements of MMALIC under the Securities Act of 1933 for each of the MMALIC Contract Categories listed in the chart below, and all amendments, consents and exhibits thereto; (b) to withdraw such statements or any amendments or exhibits and make requests for acceleration in connection therewith; (c) to take all other action of whatever kind or nature in connection with such registration statements which said attorneys may deem advisable; and (d) to make, file, execute, amend and withdraw documents of every kind, and to take other action of whatever kind they may elect, for the purpose of complying with the laws of any state relating to the sale of securities of MMALIC, the Securities Act of 1933, and any rule, regulation, order or other requirement of the Securities and Exchange Commission, hereby ratifying and confirming all actions of said attorney and agent hereunder.
MMALIC Contract Categories |
Index Frontier Contracts |
Index Summit 6 Contracts |
Index Frontier Pro Contracts |
Index Summit 6 Pro Contracts |
Index Achiever Contracts |
New Registered Indexed Linked Annuity contract (Name TBD), to be filed by January 2023 |
This Power of Attorney hereby revokes any powers of attorney previously given by the Undersigned relating to the MMALIC registration statements listed above, provided that this revocation shall not affect the exercise of such power prior to the date hereof. This Power of Attorney shall not be affected by subsequent disability or incapacity of the Undersigned.
The Undersigned has set his hand this 13th day of December, 2022, in the City of Boston, State of Massachusetts.
/s/ Roger W. Crandall |
Roger W. Crandall, Director |
Exhibit 24(e)
POWER OF ATTORNEY: RILA PRODUCT FILINGS
The Undersigned, Michael R. Fanning, director and Chief Executive Officer of MassMutual Ascend Life Insurance Company (MMALIC), appoints John Gruber, General Counsel of MMALIC, and all persons succeeding him in the capacity of General Counsel, Mark Muething, President of MMALIC, and John Domaschko, Divisional Assistant Vice President, Legal (collectively referred to hereafter as Attorneys), as the Undersigneds true and lawful attorneys and agents, each with full power to act individually.
This Power of Attorney authorizes each such Attorney (a) to sign and cause to be filed registration statements of MMALIC under the Securities Act of 1933 for each of the MMALIC Contract Categories listed in the chart below, and all amendments, consents and exhibits thereto; (b) to withdraw such statements or any amendments or exhibits and make requests for acceleration in connection therewith; (c) to take all other action of whatever kind or nature in connection with such registration statements which said attorneys may deem advisable; and (d) to make, file, execute, amend and withdraw documents of every kind, and to take other action of whatever kind they may elect, for the purpose of complying with the laws of any state relating to the sale of securities of MMALIC, the Securities Act of 1933, and any rule, regulation, order or other requirement of the Securities and Exchange Commission, hereby ratifying and confirming all actions of said attorney and agent hereunder.
MMALIC Contract Categories |
Index Frontier Contracts |
Index Summit 6 Contracts |
Index Frontier Pro Contracts |
Index Summit 6 Pro Contracts |
Index Achiever Contracts |
New Registered Indexed Linked Annuity contract (Name TBD), to be filed by January 2023 |
This Power of Attorney hereby revokes any powers of attorney previously given by the Undersigned relating to the MMALIC registration statements listed above, provided that this revocation shall not affect the exercise of such power prior to the date hereof. This Power of Attorney shall not be affected by subsequent disability or incapacity of the Undersigned.
The Undersigned has set his hand this 12th day of December, 2022, in the City of Boston, State of Massachusetts.
/s/ Michael R. Fanning |
Michael R. Fanning, Director |
Exhibit 24(f)
POWER OF ATTORNEY: RILA PRODUCT FILINGS
The Undersigned, Paul A. LaPiana, director of MassMutual Ascend Life Insurance Company (MMALIC), appoints John Gruber, General Counsel of MMALIC, and all persons succeeding him in the capacity of General Counsel, Mark Muething, President of MMALIC, and John Domaschko, Divisional Assistant Vice President, Legal (collectively referred to hereafter as Attorneys), as the Undersigneds true and lawful attorneys and agents, each with full power to act individually.
This Power of Attorney authorizes each such Attorney (a) to sign and cause to be filed registration statements of MMALIC under the Securities Act of 1933 for each of the MMALIC Contract Categories listed in the chart below, and all amendments, consents and exhibits thereto; (b) to withdraw such statements or any amendments or exhibits and make requests for acceleration in connection therewith; (c) to take all other action of whatever kind or nature in connection with such registration statements which said attorneys may deem advisable; and (d) to make, file, execute, amend and withdraw documents of every kind, and to take other action of whatever kind they may elect, for the purpose of complying with the laws of any state relating to the sale of securities of MMALIC, the Securities Act of 1933, and any rule, regulation, order or other requirement of the Securities and Exchange Commission, hereby ratifying and confirming all actions of said attorney and agent hereunder.
MMALIC Contract Categories |
Index Frontier Contracts |
Index Summit 6 Contracts |
Index Frontier Pro Contracts |
Index Summit 6 Pro Contracts |
Index Achiever Contracts |
New Registered Indexed Linked Annuity contract (Name TBD), to be filed by January 2023 |
This Power of Attorney hereby revokes any powers of attorney previously given by the Undersigned relating to the MMALIC registration statements listed above, provided that this revocation shall not affect the exercise of such power prior to the date hereof. This Power of Attorney shall not be affected by subsequent disability or incapacity of the Undersigned.
The Undersigned has set his hand this 12th day of December, 2022, in the City of Park City, State of Utah.
/s/ Paul A. LaPiana |
Paul A. LaPiana, Director |
Exhibit 24(g)
POWER OF ATTORNEY: RILA PRODUCT FILINGS
The Undersigned, Sears Merritt, director of MassMutual Ascend Life Insurance Company (MMALIC), appoints John Gruber, General Counsel of MMALIC, and all persons succeeding him in the capacity of General Counsel, Mark Muething, President of MMALIC, and John Domaschko, Divisional Assistant Vice President, Legal (collectively referred to hereafter as Attorneys), as the Undersigneds true and lawful attorneys and agents, each with full power to act individually.
This Power of Attorney authorizes each such Attorney (a) to sign and cause to be filed registration statements of MMALIC under the Securities Act of 1933 for each of the MMALIC Contract Categories listed in the chart below, and all amendments, consents and exhibits thereto; (b) to withdraw such statements or any amendments or exhibits and make requests for acceleration in connection therewith; (c) to take all other action of whatever kind or nature in connection with such registration statements which said attorneys may deem advisable; and (d) to make, file, execute, amend and withdraw documents of every kind, and to take other action of whatever kind they may elect, for the purpose of complying with the laws of any state relating to the sale of securities of MMALIC, the Securities Act of 1933, and any rule, regulation, order or other requirement of the Securities and Exchange Commission, hereby ratifying and confirming all actions of said attorney and agent hereunder.
MMALIC Contract Categories |
Index Frontier Contracts |
Index Summit 6 Contracts |
Index Frontier Pro Contracts |
Index Summit 6 Pro Contracts |
Index Achiever Contracts |
New Registered Indexed Linked Annuity contract (Name TBD), to be filed by January 2023 |
This Power of Attorney hereby revokes any powers of attorney previously given by the Undersigned relating to the MMALIC registration statements listed above, provided that this revocation shall not affect the exercise of such power prior to the date hereof. This Power of Attorney shall not be affected by subsequent disability or incapacity of the Undersigned.
The Undersigned has set his hand this 13th day of December, 2022, in the City of Boston, State of Massachusetts.
/s/ Sears Merritt |
Sears Merritt, Director |
Exhibit 24(h)
POWER OF ATTORNEY: RILA PRODUCT FILINGS
The Undersigned, Mark F. Muething, director and President of MassMutual Ascend Life Insurance Company (MMALIC), appoints John Gruber, General Counsel of MMALIC, and all persons succeeding him in the capacity of General Counsel, and John Domaschko, Divisional Assistant Vice President, Legal (collectively referred to hereafter as Attorneys), as the Undersigneds true and lawful attorneys and agents, each with full power to act individually.
This Power of Attorney authorizes each such Attorney (a) to sign and cause to be filed registration statements of MMALIC under the Securities Act of 1933 for each of the MMALIC Contract Categories listed in the chart below, and all amendments, consents and exhibits thereto; (b) to withdraw such statements or any amendments or exhibits and make requests for acceleration in connection therewith; (c) to take all other action of whatever kind or nature in connection with such registration statements which said attorneys may deem advisable; and (d) to make, file, execute, amend and withdraw documents of every kind, and to take other action of whatever kind they may elect, for the purpose of complying with the laws of any state relating to the sale of securities of MMALIC, the Securities Act of 1933, and any rule, regulation, order or other requirement of the Securities and Exchange Commission, hereby ratifying and confirming all actions of said attorney and agent hereunder.
MMALIC Contract Categories |
Index Frontier Contracts |
Index Summit 6 Contracts |
Index Frontier Pro Contracts |
Index Summit 6 Pro Contracts |
Index Achiever Contracts |
New Registered Indexed Linked Annuity contract (Name TBD), to be filed by January 2023 |
This Power of Attorney hereby revokes any powers of attorney previously given by the Undersigned relating to the MMALIC registration statements listed above, provided that this revocation shall not affect the exercise of such power prior to the date hereof. This Power of Attorney shall not be affected by subsequent disability or incapacity of the Undersigned.
The Undersigned has set his hand this 14th day of December, 2022, in the City of Cincinnati, State of Ohio.
/s/ Mark F. Muething |
Mark F. Muething, Director |
Exhibit 24(i)
POWER OF ATTORNEY: RILA PRODUCT FILINGS
The Undersigned, Michael J. OConnor, director of MassMutual Ascend Life Insurance Company (MMALIC), appoints John Gruber, General Counsel of MMALIC, and all persons succeeding him in the capacity of General Counsel, Mark Muething, President of MMALIC, and John Domaschko, Divisional Assistant Vice President, Legal (collectively referred to hereafter as Attorneys), as the Undersigneds true and lawful attorneys and agents, each with full power to act individually.
This Power of Attorney authorizes each such Attorney (a) to sign and cause to be filed registration statements of MMALIC under the Securities Act of 1933 for each of the MMALIC Contract Categories listed in the chart below, and all amendments, consents and exhibits thereto; (b) to withdraw such statements or any amendments or exhibits and make requests for acceleration in connection therewith; (c) to take all other action of whatever kind or nature in connection with such registration statements which said attorneys may deem advisable; and (d) to make, file, execute, amend and withdraw documents of every kind, and to take other action of whatever kind they may elect, for the purpose of complying with the laws of any state relating to the sale of securities of MMALIC, the Securities Act of 1933, and any rule, regulation, order or other requirement of the Securities and Exchange Commission, hereby ratifying and confirming all actions of said attorney and agent hereunder.
MMALIC Contract Categories |
Index Frontier Contracts |
Index Summit 6 Contracts |
Index Frontier Pro Contracts |
Index Summit 6 Pro Contracts |
Index Achiever Contracts |
New Registered Indexed Linked Annuity contract (Name TBD), to be filed by January 2023 |
This Power of Attorney hereby revokes any powers of attorney previously given by the Undersigned relating to the MMALIC registration statements listed above, provided that this revocation shall not affect the exercise of such power prior to the date hereof. This Power of Attorney shall not be affected by subsequent disability or incapacity of the Undersigned.
The Undersigned has set his hand this 12th day of December, 2022, in the City of Boston, State of Massachusetts.
/s/ Michael J. OConnor |
Michael J. OConnor, Director |
Exhibit 24(j)
POWER OF ATTORNEY: RILA PRODUCT FILINGS
The Undersigned, Eric W. Partlan, director of MassMutual Ascend Life Insurance Company (MMALIC), appoints John Gruber, General Counsel of MMALIC, and all persons succeeding him in the capacity of General Counsel, Mark Muething, President of MMALIC, and John Domaschko, Divisional Assistant Vice President, Legal (collectively referred to hereafter as Attorneys), as the Undersigneds true and lawful attorneys and agents, each with full power to act individually.
This Power of Attorney authorizes each such Attorney (a) to sign and cause to be filed registration statements of MMALIC under the Securities Act of 1933 for each of the MMALIC Contract Categories listed in the chart below, and all amendments, consents and exhibits thereto; (b) to withdraw such statements or any amendments or exhibits and make requests for acceleration in connection therewith; (c) to take all other action of whatever kind or nature in connection with such registration statements which said attorneys may deem advisable; and (d) to make, file, execute, amend and withdraw documents of every kind, and to take other action of whatever kind they may elect, for the purpose of complying with the laws of any state relating to the sale of securities of MMALIC, the Securities Act of 1933, and any rule, regulation, order or other requirement of the Securities and Exchange Commission, hereby ratifying and confirming all actions of said attorney and agent hereunder.
MMALIC Contract Categories |
Index Frontier Contracts |
Index Summit 6 Contracts |
Index Frontier Pro Contracts |
Index Summit 6 Pro Contracts |
Index Achiever Contracts |
New Registered Indexed Linked Annuity contract (Name TBD), to be filed by January 2023 |
This Power of Attorney hereby revokes any powers of attorney previously given by the Undersigned relating to the MMALIC registration statements listed above, provided that this revocation shall not affect the exercise of such power prior to the date hereof. This Power of Attorney shall not be affected by subsequent disability or incapacity of the Undersigned.
The Undersigned has set his hand this 12th day of December, 2022, in the City of Boston, State of Massachusetts.
/s/ Eric W. Partlan |
Eric W. Partlan, Director |
Exhibit 24(k)
POWER OF ATTORNEY: RILA PRODUCT FILINGS
The Undersigned, Arthur W. Wallace, director of MassMutual Ascend Life Insurance Company (MMALIC), appoints John Gruber, General Counsel of MMALIC, and all persons succeeding him in the capacity of General Counsel, Mark Muething, President of MMALIC, and John Domaschko, Divisional Assistant Vice President, Legal (collectively referred to hereafter as Attorneys), as the Undersigneds true and lawful attorneys and agents, each with full power to act individually.
This Power of Attorney authorizes each such Attorney (a) to sign and cause to be filed registration statements of MMALIC under the Securities Act of 1933 for each of the MMALIC Contract Categories listed in the chart below, and all amendments, consents and exhibits thereto; (b) to withdraw such statements or any amendments or exhibits and make requests for acceleration in connection therewith; (c) to take all other action of whatever kind or nature in connection with such registration statements which said attorneys may deem advisable; and (d) to make, file, execute, amend and withdraw documents of every kind, and to take other action of whatever kind they may elect, for the purpose of complying with the laws of any state relating to the sale of securities of MMALIC, the Securities Act of 1933, and any rule, regulation, order or other requirement of the Securities and Exchange Commission, hereby ratifying and confirming all actions of said attorney and agent hereunder.
MMALIC Contract Categories |
Index Frontier Contracts |
Index Summit 6 Contracts |
Index Frontier Pro Contracts |
Index Summit 6 Pro Contracts |
Index Achiever Contracts |
New Registered Indexed Linked Annuity contract (Name TBD), to be filed by January 2023 |
This Power of Attorney hereby revokes any powers of attorney previously given by the Undersigned relating to the MMALIC registration statements listed above, provided that this revocation shall not affect the exercise of such power prior to the date hereof. This Power of Attorney shall not be affected by subsequent disability or incapacity of the Undersigned.
The Undersigned has set his hand this 13th day of December, 2022, in the City of Springfield, State of Massachusetts.
/s/ Arthur W. Wallace |
Arthur W. Wallace, Director |
Exhibit 24(l)
POWER OF ATTORNEY: RILA PRODUCT FILINGS
The Undersigned, Elizabeth A. Ward, director and Chief Financial Officer of MassMutual Ascend Life Insurance Company (MMALIC), appoints John Gruber, General Counsel of MMALIC, and all persons succeeding him in the capacity of General Counsel, Mark Muething, President of MMALIC, and John Domaschko, Divisional Assistant Vice President, Legal (collectively referred to hereafter as Attorneys), as the Undersigneds true and lawful attorneys and agents, each with full power to act individually.
This Power of Attorney authorizes each such Attorney (a) to sign and cause to be filed registration statements of MMALIC under the Securities Act of 1933 for each of the MMALIC Contract Categories listed in the chart below, and all amendments, consents and exhibits thereto; (b) to withdraw such statements or any amendments or exhibits and make requests for acceleration in connection therewith; (c) to take all other action of whatever kind or nature in connection with such registration statements which said attorneys may deem advisable; and (d) to make, file, execute, amend and withdraw documents of every kind, and to take other action of whatever kind they may elect, for the purpose of complying with the laws of any state relating to the sale of securities of MMALIC, the Securities Act of 1933, and any rule, regulation, order or other requirement of the Securities and Exchange Commission, hereby ratifying and confirming all actions of said attorney and agent hereunder.
MMALIC Contract Categories |
Index Frontier Contracts |
Index Summit 6 Contracts |
Index Frontier Pro Contracts |
Index Summit 6 Pro Contracts |
Index Achiever Contracts |
New Registered Indexed Linked Annuity contract (Name TBD), to be filed by January 2023 |
This Power of Attorney hereby revokes any powers of attorney previously given by the Undersigned relating to the MMALIC registration statements listed above, provided that this revocation shall not affect the exercise of such power prior to the date hereof. This Power of Attorney shall not be affected by subsequent disability or incapacity of the Undersigned.
The Undersigned has set her hand this 12th day of December, 2022, in the City of Boston, State of Massachusetts.
/s/ Elizabeth A. Ward |
Elizabeth A. Ward, Director |
Exhibit 107
Calculation of Filing Fee Tables
Form S-1
(Form Type)
MassMutual Ascend Life Insurance Company
(Exact Name of Registrant as Specified in its Charter)
Table 1: Newly Registered and Carry Forward Securities
Security Type |
Security Class Title | Fee Calculation or Carry Forward Rule |
Amount Registered |
Proposed Maximum Offering Price Per Unit |
Maximum Aggregate Offering Price |
Fee Rate |
Amount of Registration Fee |
Carry Forward Form Type |
Carry Forward File Number |
Carry Forward Initial Effective Date |
Filing Fee Previously Paid in Connection with Unsold Securities to be Carried Forward | |||||||||||||
Newly Registered Securities | ||||||||||||||||||||||||
Fees Previously Paid | Other | Individual Index-linked Modified Single Premium Deferred Annuity Contract and interests therein | 457(o) | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||
Carry Forward Securities | ||||||||||||||||||||||||
Carry Forward Securities | Other | Individual Index-linked Modified Single Premium Deferred Annuity Contract and interests therein | 415(a)(6) | N/A | N/A | $1,006,040,546.03 | N/A | N/A | Form S-1 | 333-262810 | 4/29/2022 | $93,375.42 | ||||||||||||
Total Offering Amounts | $1,006,040,546.03 | $0 | ||||||||||||||||||||||
Total Fees Previously Paid | $0 | |||||||||||||||||||||||
Total Fee Offsets | $0 | |||||||||||||||||||||||
Net Fee Due | $0 |
J
M?VWI_P#8O]KFX7[%Y?F>9[>GU]J5;"U:+2DMPH8NE63<7L:%%>.:O\5]4N+E
MDTF&.WA!PI=-[M_2F:9\5]9MKD#4X8KF'/S )L3%;_ -G5^6_X&']IX?FM
M?Y]#V:BL*[\1POX0N-=TUEE58#(@;U]#]*\[L/BUJ4:W!OK:"4^7^Y"+M^?/
M?VK&EA*M1-Q6QM5QE*DTI/<]AHKPY_B?XH6;>SPHI.1&8 !C^=>E>#/%\?BJ
MQD+QB&\@P)8P>#GH1[55;!5:4>>6Q-#'4:TN2._F=/17GWC'XD+HUV^G:7&D
MUTG$LK\JA] .YKCX/BGXDCF$DLEO+'GE&A !_$Y@;[NQ!E/;GK7+>);W2=0U,2:-8-:P;<%/[S>N.U=#I^UE:K"S[IG.JO
ML8WI3NK[-';?%C5/M%OI4%O(&M94,P*]&["M7X;>%].&@1:I<01SW-P207&=
M@!Q@5DZWX3O;CX=:3,(V:[LH\O'WV'G'X5B>$?']QX9MFLI[
EVBQ%OO2
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MK3HO+0N6/PG\*622*;-YS(NTM*^2![5IZ%X"\/\ AN_-[IMJT
A7XU^QO=
M(0(&T^73&96"_9E9D82 =\;",>N*LZ=82^&[JY2.U>XL[B2%8FB^9XE6-4PW
MME2V?]HUTE% '$VFLZ59>/->N)IGA,ME9[_,0CD-,/ZBND/B#25@$S7T2QD
MAB<#GI43!;7Q3YC1N?MULD0< D;HV=L'TX
2#PF?7_"N>^&/_ "-&
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MRN1]Q"#^8)P?K6KXN\'7'B&'3]0L+A8KZWB4#>GXBIHPI2II12;ZW=G\BJ]2K&HW)M1Z-*Z^9TOB[QE
2#PF?7_"N>^&/_ "-&
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MRN1]Q"#^8)P?K6KXN\'7'B&'3]0L+A8KZWB4#>GXBIHPI2II12;ZW=G\BJ]2K&HW)M1Z-*Z^9TOB[QE
\DG15 7)503@ ].697/4E7YQT ![ "@#0T^UL[>'?9A&$OS-,#N,I] M2W>K=4H;W2[>%(8+FSCC081$D4 #T %+]MDF^6TMW?MYDJF-!^?)_ $>] $A MN@-06T !)B,A.>F"!T_&LB1!K^JSV\A)TVR8))'VGEQG:WJH!'' W MT+3KN_NKA?-92S2.0-Q X4#T]!]:?H%DUAHMO'*#Y[KYLY/>1OF;]3C\* 'Z MGI<=["K1XANX1FWG08:,^@/H>XZ&I=-NVO=/BG==DA!61?1@<'\,C\JMU6@M M?L]S/(C#RYFWE<=&Z$_CQ^5 %FL-]2N]6N9+71R(X(SMEOV&Y0>ZQC^)O<\# MWZ4>(KQHUMK%9'C6Z?9+)&K,RICG 4$Y/3\:CN]8CT6TMK2PTF=RY\JUB $8 M<^F/O#U)*T 0ZAIT%LD>FV*EKZ_8">YD^>4Q@Y9F;K[ =.<#%=(JK'&%4!44 M8 ] *PM-TC5%DFO+Z]BCN[@YD-O'N**.B*S9&!_N\UH#2+-CNN$:Z;KFY8R M'U"GY1^ % %N*>&X4M#*DB@X)1@1GTXJ2L3PZ%F%]?*-JW%P0BCH%7Y1_6MN M@ K'\^;6;F2&VD:+3XCMDG1B&E;NJ'LH[GOV]:/$,\_V:"QM&V7%[*(MPZHG M5V_+^=7A]CTG3P"T=O:P(!DG 44 4;G3K2RGLI+2%+>4S!"T8P77!R&_O#ZU ML5D64 -TG1W)Z!5'R@^I8 BXC6W*YWNVT#U!ST( MZ$'I5"7Q';6\B27$4D%@[;!>S82/<>G7D*?[QP,X]:TOL=J9_/-M#YV<^9Y8 MW?GUJ>@#G=6O_"VL63V6HZE8F'<&(DN%3D'(()//-;5O?V=V ;:[@FSR/+D# M9_*K%4;C1M*NR3 HK-3P]HL3H\6DV,;H M6Z *$>I>6RQ7\?V64\!B @]E(H P_"=C#^&VFZ3I\^GFZ$L MT3K-*956-"H4G[W4FM*@#EIWU8^)K-);>Q:9+9S%)YSA0Q.&.-I[8XS^-:L& MDNTRW.I737DR'H([@]Z;] MIO!&5:P8R@=4D783]20X_YO^_=O_ /&JU:* ,O\ LN] XU_4#SWCM_\ XU0-+OAG_B?Z M@?K%;_\ QJM2B@#+&EWO?7]0_".W_P#C5.&F78ZZYJ!^J0?_ !JM*B@#.72I M GOR3W%_.O\ )Q6C10!E_P#".Z6W$ULUR <@74KS M#_Q\FHCHD=M?VDFEQI91(^Z=82561=I&W8/E)S@YQD8XZULT4 %%%% !1110 M 4444 %%%% !1110 4444 %%%% !1110 4444 %%%% !1110 4444 %%%% ! 61110 4444 %%%% !1110 4444 ?_V0$! end
2#PF?7_"N>^&/_ "-&
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MRN1]Q"#^8)P?K6KXN\'7'B&'3]0L+A8KZWB4#>GXBIHPI2II12;ZW=G\BJ]2K&HW)M1Z-*Z^9TOB[QE
2#PF?7_"N>^&/_ "-&
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MRN1]Q"#^8)P?K6KXN\'7'B&'3]0L+A8KZWB4#>GXBIHPI2II12;ZW=G\BJ]2K&HW)M1Z-*Z^9TOB[QE
J
M?VWI_P#8O]KFX7[%Y?F>9[>GU]J5;"U:+2DMPH8NE63<7L:%%>.:O\5]4N+E
MDTF&.WA!PI=-[M_2F:9\5]9MKD#4X8KF'/S )L3%;_ -G5^6_X&']IX?FM
M?Y]#V:BL*[\1POX0N-=TUEE58#(@;U]#]*\[L/BUJ4:W!OK:"4^7^Y"+M^?/
M?VK&EA*M1-Q6QM5QE*DTI/<]AHKPY_B?XH6;>SPHI.1&8 !C^=>E>#/%\?BJ
MQD+QB&\@P)8P>#GH1[55;!5:4>>6Q-#'4:TN2._F=/17GWC'XD+HUV^G:7&D
MUTG$LK\JA] .YKCX/BGXDCF$DLEO+'GE&A !_$Y@;[NQ!E/;GK7+>);W2=0U,2:-8-:P;<%/[S>N.U=#I^UE:K"S[IG.JO
ML8WI3NK[-';?%C5/M%OI4%O(&M94,P*]&["M7X;>%].&@1:I<01SW-P207&=
M@!Q@5DZWX3O;CX=:3,(V:[LH\O'WV'G'X5B>$?']QX9MFLI[
EVBQ%OO2
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MK3HO+0N6/PG\*622*;-YS(NTM*^2![5IZ%X"\/\ AN_-[IMJT
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end
2#PF?7_"N>^&/_ "-&
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MRN1]Q"#^8)P?K6KXN\'7'B&'3]0L+A8KZWB4#>GXBIHPI2II12;ZW=G\BJ]2K&HW)M1Z-*Z^9TOB[QE
2#PF?7_"N>^&/_ "-&
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MRN1]Q"#^8)P?K6KXN\'7'B&'3]0L+A8KZWB4#>GXBIHPI2II12;ZW=G\BJ]2K&HW)M1Z-*Z^9TOB[QE
&[N-+@ M>8XRQ!&<=.!Q16U11[6IMS/[P]E3O?E7W!11169H%%%% !1110!Y];?\EINO M^O+^BUW&H,R:9=,I*L(7((/(.#7"ZSH_B>U\=3ZYHMG!,KPB,&5QCH,\9![5 MK:7+XOO?M<&M6-G# ]NZHT3<[R, =3Q7=5BI*,U):)==3AHS<7*#B]6^FAR= MM:3:Q\)'N;B_NA):M-+Q(3YF/X6SU%+ISR^$_AU_;=M>7$EQ>HL4<$I;[X=VVA7I$-U&@*L#D( MX)(_GC\:WE7A=Q;]WF_ YXT*EE)+WN3\3SX7.BO9?:I/%.K?VR5W>8%?8']/ M7'XUZ5X#UVXU_P -)/=\W$3F)WQC?CH?R-<^L?CJ&S&F+H^FM(J^6M]\O3IN MZ]?P_"NWT.RNM/T>WMKVX6XN47]Y*JA0Q)_R/PJ,7.+A;1N^FJ?Y+8TPE.2J M7U2MKHU^;>IQ]S_R6FU_Z\OZ-6+X:T>]\57^LQ7FLWT=C! "-"O]%FUEKV-4%S=>9%A@ '6U'P]XTO?#8O)+RW:W,UOYS9*G&1]/0U MRUI/8W<]S_PD^LZM8:QYIVOSL3TX S_*O0)=!U(_$=]9B5%M39F-920);FXM8O!Z0:O+=J]QAKA'QYPRG)QUZFNA^(4\MOX*OI()7B MD!3#(Q!'S#N*P;OP#?KX-TVTM;A#J=A*9UR?E)8Y*@^V!^50ZU:>.?$^C/8W M.G6EK&A#.%D^:8@\ I RQ]3UJ_KJ7O@;PX\5IJEU=WFHW"QK-<-DQ\')'H: MN7/AK4Y-;\)W"Q(8M.@1+@[Q\I &?K6WXO\ #G_"2Z*;5)!% RO8S:J25^;I]RV.:D\ W]CIKW]MX@OO[62,NS&0['..5]?Q M-<])J-\/A'!<"\N!-_:&WS/-;=C!XSGI71?\7!O;!M(EM;. %/+>^+\E<8XP M>I^GY53?P;K3?#:'1Q GVU;WSBGF#&WD=?QK6$[6]K)/5=MM3&=-N_LHM>Z^ M^^GXDNH^"[R/0)-9?7K]M5CA\\MYA"9 R5'<4R\\7ZI<^"-%6VDV:EJ4OV9I M^F,';D>A/'ZUWFHVDUQX=N;., S/;-&HSQNVXKC(_ M]<^!+&QD=+;5;.5IH M6W9 ))."1^'Y5C3K0FDZMM'^%ORN;5*,X-JDGJOQNOQM<63X>ZE9P+=Z9X@N MSJBX8M*YV.>_^3FJWCCQ%>VMSIFB7%^;(20K)?7-LI)/4$+CG'!_,58E;XB: MG;KIKV]M99P)+U'PQ [C!/Z"KWB+PIJ4LFFZKIEPD^J6,0B?[0.+A1Z^_)_. MJC.TU[:2>_\ P-290O"2HQ:VOO\ /2YPTVLZ?H,L%[X;US4)Y5<>=;W2MLD7 MO[5[&UPUQH[7$ (:2W+H.X)7(KBTMO&6L7EO'-8V.CVT;AI9(U5F<>@'->@5 MEBYQ?+W];_DD;82$ES=O2WW7;."^% @_X1NY=//%$7V&^BM M=+LWXF:,\L/3J2?IQ15IQK3]HII)_>OD*E4E1IJDX-M=MG\S2\ VZZ7H^ MCRB&;4I-@F0XV*,#@]NO;TK'U?PAJ'A?2I-:TS7;Q[JV DF61LK(._']#FMG M6_ WG:#IMMI$_E7FEG=;22'[Q)R A:$^N0:[?OJ4&UY':4[6R1G'?O47 MB'4]6U63PBUC>26UU>P@DHY"[S@$D?G7=>*].N=5\+7MC:*&GE0!%)QDY!ZU MYYXCTW4;23P;IT3K#J,<0C5LY"/D8Y^M/#U/:6 ^'=,DUO3==OGO+8>9+YKY$@[_\ ZCFEUGQ+J6N67A[3=.F-I<:M M&&FE4X*CH0#Z9!-2:A;^._$=L-(N[.TL;9R!/<(^=X!^I_*K^O\ @F=M-TEM M#F$5_I2A86 IOI7@M+2_FAN+B/:9-YY)VC)] M>M:&K6WCOQ+I,MC<6-I9Q! M4/$.E1#X9FSU!EC>TLX_FZ[9$4#CZD8_&L:=934>?5M MM/T9K4HN$I>ST22:[77]:E'4KJXU[XDV6EVMQ*EGIJB>Y\MR S<'!QU_A'XF MN]KA?AAI+VVA2:I<[FN;]]P9NNP<#\SD_E7=5SXFRG[..T=/\SIPMW#VDMY: M_P"7X!1117,=(4444 %%%% !1110 4444 %%%% !1110 4444 %%%% !1110 M 4444 %%%% !1110 4444 %%%% !1110 4444 %%%% !1110 4444 %%%% ! M1110 4444 %%%% !7&>*K2.;QGX8D8L&69L8/I@T45T8;^)\G^3.?%?P_FOS M1V=%%%
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end
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end
February 15, 2023
VIA EDGAR
U.S. Securities and Exchange Commission
100 F Street, NE
Washington, DC 20549
Re: | MassMutual Ascend Life Insurance Company |
Registration Statement on Form S-1
Commissioners:
MassMutual Ascend Life Insurance Company (the Company) is filing under the Securities Act of 1933, as amended (the Securities Act), a registration statement (the Registration Statement) for the Index Summit 6 Pro Annuity With Return of Premium Guarantee and the Index Summit 6 Pro Annuity, each a modified single premium deferred annuity contract (the Contracts). The Registration Statement includes a separate prospectus for each Contract and a single Part II.
The Company respectfully requests selective review of the Registration Statement in accordance with Securities Act Release No. 6510 (Feb. 15, 1984). Except for the changes discussed below, the disclosure in the Registration Statement is not substantially different from the disclosure included in Pre-Effective Amendment No. 3 to the prior registration statement for the Contracts, as filed on April 29, 2022 (File No. 333-262810; Accession No. 0001193125-22-132742), which was reviewed by the Commission staff and declared effective by the Commission on May 2, 2022.
The changes made in the Registration Statement reflect:
| The addition of eight new strategies to each of the Contracts |
| The removal of two indexed strategies from each of the Contracts |
| The addition of a Performance Lock feature to each of the Contracts |
| Changes to the Unavailable Indexed Strategies sections of each Contract |
| Other nonmaterial revisions. |
In addition, multiple exhibits are included with the filing. The purpose of most of the exhibits is clear, but the purpose of Exhibits 4(a)(1) through 4(b)(9) may not be self-evident. Those exhibits were filed to update the branding in the documents to incorporate the Companys new name.
The Company will separately provide a marked copy of the Registration Statement to facilitate the Commission Staffs review. Other than the new and revised disclosures in the Registration Statement reflecting the changes listed above, the Company believes that there are no other disclosures in the Registration Statement that warrant particular attention by the Commission staff.
Please direct any questions or comments regarding the Registration Statement to the undersigned at 513.361.9401 or at jdomaschko@mmascend.com.
Sincerely, |
/s/ John V. Domaschko |
John V. Domaschko |
Divisional Assistant Vice President |
MassMutual Ascend Life Insurance Company |
cc: | John V. Domaschko, MassMutual Ascend Life Insurance Company |
John P. Gruber, MassMutual Ascend Life Insurance Company
Dodie Kent, Eversheds Sutherland (US) LLP
2