Accumulation Phase: |
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There are no sales charges, deferred sales charges, or surrender charges associated with this contract. |
• | Table A reflects the subaccount expenses for the VAA. |
• | Table B reflects the i4LIFE® Indexed Advantage Rider Charge. |
VAA Separate Account Annual Expenses (as a percentage of average daily net assets in the Subaccounts)1 |
||
Guaranteed Maximum and Current Product Charges: |
||
Guarantee of Principal Death Benefit |
||
Mortality and Expense Risk Charge
|
0.20% | |
Administrative Charge
|
0.10% | |
Total Separate Account Expenses
|
0.30% |
1 | The Product Charge is 0.10% after the Annuity Commencement Date. The Guarantee of Principal Death Benefit will automatically terminate at any time all Contractowners or Annuitants are changed. If this happens, the Account Value Death Benefit will be in effect, and the Product Charge of 0.10% for the Account Value Death Benefit will apply. |
i4LIFE® Indexed Advantage
rider charge:1 |
|
Guaranteed Maximum and Current Annual Charge
|
0.40% |
1 | The i4LIFE® Indexed Advantage charge will be deducted from your variable and index-linked Account Value on each rider anniversary. See Charges and Other Deductions – i4LIFE® Indexed Advantage Charge for more information. During the Lifetime Income Period, the mortality and expense risk and administrative charge for the variable payments will be 1.50%. |
Minimum | Maximum | ||
Total Annual Fund Operating Expenses (expenses that are deducted from fund assets, including management fees, distribution and/or service (12b-1) fees, and other expenses)
|
0.74% | 0.74% |
Management Fees (before any waivers/ reimburse- ments) |
+ | 12b-1 Fees (before any waivers/ reimburse- ments) |
+ | Other Expenses (before any waivers/ reimburse- ments) |
+ | Acquired Fund Fees and Expenses |
= | Total Expenses (before any waivers/ reimburse- ments) |
|
LVIP Government Money Market Fund - Service Class | 0.38% | 0.25% | 0.11% | 0.00% | 0.74% |
1 year | 3 years | 5 years | 10 years | |||
$147 | $455 | $787 | $1,724 |
1 year | 3 years | 5 years | 10 years | |||
$147 | $455 | $787 | $1,724 |
1 year | 3 years | 5 years | 10 years | |||
$106 | $331 | $574 | $1,271 |
1 year | 3 years | 5 years | 10 years | |||
$106 | $331 | $574 | $1,271 |
1. | We reserve the right, within the law, to make certain changes to the structure and operation of the VAA or Indexed Accounts at our discretion and without your consent. We reserve the right to limit Purchase Payments into the contract. We may add, delete, or substitute funds for all Contractowners or only for certain classes of Contractowners. We may add to or delete Indexed Accounts currently available. We do not guarantee that an Indexed Account option will always be available. |
2. | Any telephone, fax machine or other electronic device, whether it is yours, your service provider’s, or your agent’s can experience outages or slowdowns for a variety of reasons and may not always be available. These outages or slowdowns may delay or prevent our processing your surrender, withdrawal, or transfer request. |
1. | There is a risk of loss of your investment in the Indexed Segments since the performance tracks a market index. You are responsible for all losses in excess of the Protection Level you choose. The Protection Level exists for the full term of the Indexed Segment. When you move into a new Indexed Segment after the end of an Indexed Term the performance will be calculated for the new Segment, which may have a new Protection Level, which could also result in a loss. There is also a risk of loss upon an early withdrawal. |
2. | Gains in your Indexed Segments are limited by any applicable Performance Cap, which means that your return could be lower than if you had invested directly in a fund based on the applicable Index. The Performance Cap exists for the full term of the Indexed Segment. The Performance Cap rate is lower for contracts with the Guarantee of Principal Death Benefit. Generally, Indexed Segments with greater Protection Levels have lower Performance Caps. Performance Caps for new Segments will be declared 5 business days in advance of the beginning of a Segment. |
3. | To determine the Interim Value, we apply a formula which does not reflect the actual performance of the applicable Index, but rather a determination of the value of hypothetical underlying investments at the time of the Interim Value calculation. This amount could be less than if you had held the Indexed Segment for the full Indexed Term. It also means that you could have a negative performance, even if the value of the Index has increased during the calculation period. All withdrawals from the Indexed Segment, including Death Benefits paid during the Indexed Term, will be based on the Interim Value. |
4. | If you withdraw Contract Value allocated to an Indexed Account, the withdrawal will cause an immediate reduction to your Indexed Crediting Base in a proportion equal to the reduction in your Interim Value. A proportional reduction could be larger than the dollar amount of your withdrawal. Reductions to your Indexed Crediting Base will negatively impact your Interim Value for the remainder of the Indexed Term and will result in a lower Indexed Segment Maturity Value at the end of the Indexed Term. Once your Indexed Crediting Base is reduced due to a withdrawal during any Indexed Term, you cannot increase it during the remainder of the Indexed Term. |
5. | The indexed performance credited to your Indexed Segment is determined on the last day of the Indexed Term. It is not affected by the price of the Index on any date in between the effective date of the Indexed Account and the End Date of the Indexed Term. |
6. | We may change the Index on a particular Indexed Account if the Index is discontinued or if we feel the Index is no longer appropriate. This change may occur in the middle of an Indexed Segment and this change may impact how your Indexed Segment performance and Interim Value are calculated. |
7. | The available Indexed Accounts with applicable Performance Caps and Protection Levels will vary over time. Before investing in a new Indexed Segment, you should determine exactly what Indexed Accounts, Protection Levels and Performance Caps are available to you. There is no guarantee that an Indexed Account will be available in the future. You should make sure the Segment(s) you select is appropriate for your investment goals. |
8. | The risks associated with the currently available Indices are as follows: |
• | Equity markets are subject to the risk that the value of the securities may fall due to general market and economic conditions. Market volatility may exist with these indices, which means that the value of the indices can change dramatically over a short period of time in either direction. Additional risks for specific indices are as follows: |
• | Russell® 2000 Price Return Index: Compared to mid-and large-capitalization companies, small-capitalization companies may be less stable and more susceptible to adverse developments, and their securities may be more volatile and less liquid. |
• | MSCI EAFE Price Return Index: International investing involves special risks not found in domestic investing, including political and social differences and currency fluctuations due to economic decisions. Emerging markets can be riskier than investing in well established foreign markets. The risks associated with investing on a worldwide basis include differences in the regulation of financial data and reporting, currency exchange differences, as well as economic and political systems differences. |
9. | If we do not receive investment instructions from you by the end of an Indexed Term, we will invest your Segment Maturity Value in a new Indexed Segment with the same term, Index and Protection Level if available. The Performance Cap in effect at the time for new Indexed Segments will apply. If the same type of Indexed Segment is not available, your Segment Maturity Value will be moved to the LVIP Government Money Market Fund. If your Contract Value has been invested in a new Segment and you wish to withdraw your investment, the Contract Value for that Segment will equal the Interim Value. |
10. | You will not have voting rights or rights to receive cash dividends or other rights that shareholders who invest in mutual funds based on these Indices would have. |
11. | Your receipt of funds invested in the Indexed Segments is based on the claims paying ability of Lincoln Life. You have no ownership rights in the underlying securities. The assets backing the Indexed Accounts are not segregated from other business of Lincoln Life. |
12. | The only available annuitization option for the Indexed Accounts is i4LIFE® Indexed Advantage, which has an additional charge. |
1. | You take all the investment risk on the Contract Value and the retirement income for amounts placed into the Subaccount, which invests in a corresponding underlying fund. If the Subaccount makes money, your Contract Value goes up; if it loses money, your Contract Value goes down. How much it goes up or down depends on the performance of the Subaccount. |
2. | The dollar amount of the charge for certain optional Death Benefits may increase as your Contract Value increases. |
3. | Your receipt of a Death Benefit over and above the amounts invested in the VAA is based on the claims paying ability and credit worthiness of Lincoln Life. |
4. | The fund has reserved the right to temporarily or permanently refuse payments or transfer requests received from us, especially in cases of suspected market timing. To the extent permitted by applicable law, we, in turn, reserve the right to defer or reject your transfer request at any time we are unable to redeem shares of an underlying fund. |
5. | Annuity Payouts will fluctuate with the performance of the Subaccount. |
Indexed Start Date | Index Value | Index % Change | Account Performance Rate (adjusted for Cap) | Segment Maturity Value |
1/8/2019 | 1,679 | +7% | +7% | $107,000 |
1/8/2020 | 1,880 | +12% | +10% | $117,700 |
1 Year | |
Indexed Term length
|
12 months |
Months since Indexed Term Start Date
|
9 |
Indexed Crediting Base
|
$1,000 |
Protection Level
|
10% |
Performance Cap
|
7.25% |
Months to End Date
|
3 |
Change in Index Value is -30% |
1 Year |
1. Fair Value of Hypothetical Fixed Instrument
|
$993 |
2. Fair Value of Hypothetical Derivatives
|
$(198) |
3. Sum of 1 + 2
|
$796 |
4. Pro-rated Cap
|
$1,054 |
Account Interim Value = Minimum of 3 and 4
|
$796 |
Change in Index Value is -10% |
1 Year |
1. Fair Value of Hypothetical Fixed Instrument
|
$993 |
2. Fair Value of Hypothetical Derivatives
|
$(20) |
3. Sum of 1 + 2
|
$973 |
4. Pro-rated Cap
|
$1,054 |
Account Interim Value = Minimum of 3 and 4
|
$973 |
Change in Index Value is 20% |
1 Year |
1. Fair Value of Hypothetical Fixed Instrument
|
$993 |
2. Fair Value of Hypothetical Derivatives
|
$68 |
3. Sum of 1 + 2
|
$1,061 |
4. Pro-rated Cap
|
$1,054 |
Account Interim Value = Minimum of 3 and 4
|
$1,054 |
Change in Index Value is 40% |
1 Year |
1. Fair Value of Hypothetical Fixed Instrument
|
$993 |
2. Fair Value of Hypothetical Derivatives
|
$71 |
3. Sum of 1 + 2
|
$1,064 |
4. Pro-rated Cap
|
$1,054 |
Account Interim Value = Minimum of 3 and 4
|
$1,054 |
• | LVIP Government Money Market Fund (Service Class): Current income while (i) maintaining a stable value of your shares (providing stability of net asset value) and (ii) preserving the value of your initial investment (preservation of capital). |
• | remove, combine, or add Subaccounts and make the new Subaccounts available to you at our discretion; |
• | transfer assets supporting the contracts from one Subaccount to another or from the VAA to another separate account; |
• | combine the VAA with other separate accounts and/or create new separate accounts; |
• | deregister the VAA under the 1940 Act; and |
• | operate the VAA as a management investment company under the 1940 Act or as any other form permitted by law. |
• | processing applications for and issuing contracts; |
• | processing purchases and redemptions of fund shares and from Indexed Accounts as required (including automatic withdrawal services if available – See Additional Services and the SAI for more information on these programs); |
• | maintaining records; |
• | administering Annuity Payouts; |
• | furnishing accounting and valuation services (including the calculation and monitoring of daily Subaccount values, Indexed Contract Values and Interim Values); |
• | reconciling and depositing cash receipts; |
• | providing contract confirmations; |
• | providing toll-free inquiry services; and |
• | furnishing telephone and other electronic surrenders, withdrawals and fund transfer services. |
• | the risk that Annuitants upon which Annuity Payouts are based live longer than we assumed when we calculated our guaranteed rates (these rates are incorporated in the contract and cannot be changed); |
• | the risk that our costs in providing the services will exceed our revenues from contract charges (which we cannot change); |
• | the risks related to supporting and replicating Index Account performance with our assets; and |
• | the risk that Death Benefits paid will exceed the actual Contract Value. |
Guarantee of Principal Death Benefit
|
0.30% |
• | the use of mass enrollment procedures, |
• | the performance of administrative or sales functions by the employer, |
• | the use by an employer of automated techniques in submitting deposits or information related to deposits on behalf of its employees, |
• | the issue of a new Lincoln contract with the proceeds from the surrender of an existing Lincoln variable annuity contract, if available in your state, or |
• | any other circumstances which reduce distribution or administrative expenses. |
1. | The total value of the fund shares held in the Subaccount is calculated by multiplying the number of fund shares owned by the Subaccount at the beginning of the Valuation Period by the net asset value per share of the fund at the end of the Valuation Period, and adding any dividend or other distribution of the fund if an ex-dividend date occurs during the Valuation Period; minus |
2. | The liabilities of the Subaccount at the end of the Valuation Period; these liabilities include daily charges imposed on the Subaccount, and may include a charge or credit with respect to any taxes paid or reserved for by us that we determine result from the operations of the VAA; and |
3. | The result is divided by the number of Subaccount units outstanding at the beginning of the Valuation Period. |
1. | proportionately from all Subaccounts within the VAA, until exhausted; then |
2. | the transfer account; then |
3. | proportionately from all Indexed Accounts. |
upon death of: | and... | and... | Death Benefit proceeds pass to: |
Contractowner | There is a surviving joint owner | The Annuitant is living or deceased | Joint owner |
Contractowner | There is no surviving joint owner | The Annuitant is living or deceased | Designated Beneficiary |
Contractowner | There is no surviving joint owner and the Beneficiary predeceases the Contractowner | The Annuitant is living or deceased | Contractowner's estate |
Annuitant | The Contractowner is living | There is no contingent Annuitant | The youngest Contractowner becomes the contingent Annuitant and the contract continues. The Contractowner may waive* this continuation and receive the Death Benefit proceeds. |
Annuitant | The Contractowner is living | The contingent Annuitant is living | Contingent Annuitant becomes the Annuitant and the contract continues |
Annuitant** | The Contractowner is a trust or other non-natural person | No contingent Annuitant allowed with non-natural Contractowner | Designated Beneficiary |
* | Notification from the Contractowner to receive the Death Benefit proceeds must be received within 75 days of the death of the Annuitant. |
** | Death of Annuitant is treated like death of the Contractowner. |
• | the Contract Value as of the Valuation Date we approve the payment of the claim; or |
• | the sum of all Purchase Payments decreased by all withdrawals in the same proportion that withdrawals reduce the Contract Value. |
1. | on the Annuity Commencement Date; |
2. | upon payment of a Death Benefit under the Guarantee of Principal Death Benefit (unless the contract is continued by the surviving spouse); or |
3. | at any time all Contractowners or Annuitants are changed. |
1. | proof (e.g. an original certified death certificate), or any other proof of death satisfactory to us; and |
2. | written authorization for payment; and |
3. | all required claim forms, fully completed (including selection of a settlement option). |
• | if any Beneficiary dies before the Contractowner, that Beneficiary’s interest will go to any other Beneficiaries named, according to their respective interests; and/or |
• | if no Beneficiary survives the Contractowner, the proceeds will be paid to the Contractowner’s estate. |
Minimum Access Period | Maximum Access Period |
The greater of 20 years or the difference between your nearest age and age 90, based on the youngest covered life if joint life is elected |
The length of time between your age and age 115 for nonqualified contracts (based on the youngest covered life if joint life is elected); age 100 for qualified contracts. |
• | the age and sex of the Annuitant and Secondary Life, if applicable; |
• | the length of the Access Period selected; |
• | the 3% Assumed Interest Rate (AIR); and |
• | the Individual Annuity Mortality table specified in your contract. |
• | the Account Value as of the Valuation Date we approve the payment of the claim; or |
• | the sum of all Purchase Payments, less the sum of the Periodic Income Payments and other withdrawals where: |
• | Periodic Income Payments and any additional Required Minimum Distribution payments reduce the Death Benefit by the dollar amount of the payment; and |
• | All other withdrawals, if any, reduce the Death Benefit in the same proportion that withdrawals reduce the Contract Value or Account Value. |
Guarantee of Principal Death Benefit
|
$200,000 |
i4LIFE® Indexed Advantage Periodic Income Payment
|
$25,000 |
Additional withdrawal
|
$15,000 ($15,000/$150,000 = 10% withdrawal) |
Account Value at the time of withdrawal
|
$150,000 |
1. | proof (e.g. an original certified death certificate), or any other proof of death satisfactory to us; and |
2. | written authorization for payment; and |
3. | all required claim forms, fully completed (including selection of a settlement option). |
• | proof, satisfactory to us, of the death; |
• | written authorization for payment; and |
• | all claim forms, fully completed. |
• | the Contract Value on the Annuity Commencement Date, less any applicable premium taxes; |
• | the annuity tables contained in the contract; |
• | the annuity option selected; and |
• | the investment performance of the fund(s) selected. |
1. | Determine the dollar amount of the first periodic payout; then |
2. | Credit the contract with a fixed number of Annuity Units equal to the first periodic payout divided by the Annuity Unit value; and |
3. | Calculate the value of the Annuity Units each period thereafter. |
• | your Contract Value drops below certain state specified minimum amounts ($1,000 or less) for any reason, including if your Contract Value decreases due to the performance of the Subaccounts you selected; |
• | no Purchase Payments have been received for two (2) full, consecutive Contract Years; and |
• | the annuity benefit at the Annuity Commencement Date would be less than $20.00 per month (these requirements may differ in some states). |
• | when the NYSE is closed (other than weekends and holidays); |
• | times when market trading is restricted or the SEC declares an emergency, and we cannot value units or the funds cannot redeem shares; or |
• | when the SEC so orders to protect Contractowners. |
• | An individual must own the contract (or the Code must treat the contract as owned by an individual). |
• | The investments of the VAA must be “adequately diversified” in accordance with Treasury regulations. |
• | Your right to choose particular investments for a contract must be limited. |
• | The Annuity Commencement Date must not occur near the end of the Annuitant’s life expectancy. |
• | Contracts in which the named owner is a trust or other entity that holds the contract as an agent for an individual; however, this exception does not apply in the case of any employer that owns a contract to provide deferred compensation for its employees; |
• | Immediate annuity contracts, purchased with a single premium, when the annuity starting date is no later than a year from purchase and substantially equal periodic payments are made, not less frequently than annually, during the Annuity Payout period; |
• | Contracts acquired by an estate of a decedent; |
• | Certain qualified contracts; |
• | Contracts purchased by employers upon the termination of certain qualified plans; and |
• | Certain contracts used in connection with structured settlement agreements. |
• | If the Beneficiary receives Death Benefits under an Annuity Payout option, they are taxed in the same manner as Annuity Payouts. |
• | If the Beneficiary does not receive Death Benefits under an Annuity Payout option, they are taxed in the same manner as a withdrawal. |
• | If Death Benefits are received in accordance with the existing Annuity Payout option following the death of a Contractowner who is not the Annuitant, they are excludible from income in the same manner as the Annuity Payout prior to the death of the Contractowner. |
• | If Death Benefits are received in accordance with the existing Annuity Payout option following the death of the Annuitant (whether or not the Annuitant is also the Contractowner), the Death Benefits are excludible from income if they do not exceed the investment in the contract not yet distributed from the contract. All Annuity Payouts in excess of the investment in the contract not previously received are includible in income. |
• | If Death Benefits are received in a lump sum, the Code imposes tax on the amount of Death Benefits which exceeds the amount of Purchase Payments not previously received. |
• | you receive on or after you reach 59½, |
• | you receive because you became disabled (as defined in the Code), |
• | you receive from an immediate annuity, |
• | a Beneficiary receives on or after your death, or |
• | you receive as a series of substantially equal periodic payments based on your life or life expectancy (non-natural owners holding as agent for an individual do not qualify). |
• | Individual Retirement Accounts and Annuities (“Traditional IRAs”) |
• | Roth IRAs |
• | Traditional IRA that is part of a Simplified Employee Pension Plan (“SEP”) |
• | SIMPLE 401(k) plans (Savings Incentive Matched Plan for Employees) |
• | 401(a) / (k) plans (qualified corporate employee pension and profit-sharing plans) |
• | 403(a) plans (qualified annuity plans) |
• | 403(b) plans (public school system and tax-exempt organization annuity plans) |
• | H.R. 10 or Keogh Plans (self-employed individual plans) |
• | 457(b) plans (deferred compensation plans for state and local governments and tax-exempt organizations) |
• | Federal tax rules limit the amount of Purchase Payments or contributions that can be made, and the tax deduction or exclusion that may be allowed for the contributions. These limits vary depending on the type of qualified retirement plan and the participant’s specific circumstances (e.g., the participant’s compensation). |
• | Minimum annual distributions are required under some qualified retirement plans once you reach age 70½ or retire, if later as described below. |
• | Loans are allowed under certain types of qualified retirement plans, but Federal income tax rules prohibit loans under other types of qualified retirement plans. For example, Federal income tax rules permit loans under some section 403(b) plans, but prohibit loans under Traditional and Roth IRAs. If allowed, loans are subject to a variety of limitations, including restrictions as to the loan amount, the loan’s duration, the rate of interest, and the manner of repayment. Your contract or plan may not permit loans. |
• | Distribution received on or after the Annuitant reaches 59½, |
• | Distribution received on or after the Annuitant’s death or because of the Annuitant’s disability (as defined in the Code), |
• | Distribution received as a series of substantially equal periodic payments based on the Annuitant’s life (or life expectancy), or |
• | Distribution received as reimbursement for certain amounts paid for medical care. |
• | deduction of any account fee or rider charges; |
• | any transfer or withdrawal under AWS; and |
• | Periodic Income Payments from i4LIFE® Indexed Advantage. |
Item | |
Special Terms | |
Services | |
Principal Underwriter | |
Purchase of Securities Being Offered | |
Annuity Payouts | |
Determination of Accumulation and Annuity Unit Value | |
Capital Markets | |
Advertising & Ratings | |
About the Indices | |
Unclaimed Property | |
Additional Services | |
Other Information | |
Financial Statements |
|
Please send me a free copy of the current Statement of Additional Information for Lincoln Life Variable Annuity Account N Lincoln Level Advantage® Fee-Based. |
1. | The fair value of the Indexed Crediting Base is meant to represent the market value of the investment instruments supporting the Indexed Segment. It is the present value of the Indexed Crediting Base of the Indexed Segment discounted at a rate that reflects movements in the interest rate market. The Reference Rate will apply on a uniform basis for a class of Contractowners in the same Indexed Segment and will be administered in a uniform and non-discriminatory manner. |
The maximum Reference Rate is the average U.S. Treasury Constant Maturity yield plus the LMVA Composite OAS Index rate. The U.S. Treasury Constant Maturity yield is the rate for the maturity using a set duration. The duration is set to represent the duration of the investment instruments supporting the Indexed Segment and may not match the actual length of the Indexed Segment. The average is measured using yields on the 1st, 8th, 15th, and 22nd day of the calendar month preceding the calendar month for which the Reference Rate applies. | |
If the U.S. Treasury Constant Maturity yield is not published for a particular day, then we will use the yield on the next day it is published. If the U.S. Treasury Constant Maturity yield is no longer published, or is discontinued, then we may substitute another suitable method for determining this component of the Reference Rate. If a U.S. Treasury Constant Maturity yield is not published for a time to maturity that matches the selected duration, then the yield will be interpolated between the yield for maturities that are published. | |
The LMVA Composite OAS Index rate will be as of the last business day of the month for which the Reference Rate applies. | |
If the LMVA Composite OAS Index rate is no longer available, or is discontinued, we will substitute another suitable index or indexes for determining this component of the Reference Rate. | |
The Reference Rate may be reduced by a rate reduction factor, which increases the value of (1) above. This rate reduction factor will vary with each Indexed Account option and will be declared at the same time a Performance Cap is declared. Currently, the rate reduction factor does not apply to 1-year Indexed Accounts. This rate reduction factor is available upon request by calling us. | |
2. | Fair Value of Replicating Portfolio of Options - We utilize a fair market value methodology to value the replicating portfolio of options that support this product. |
3. | The pro rata portion of the Performance Cap equal to the days in the Indexed Term until the withdrawal is applied to the Indexed Crediting Base to place an upper limit on the performance credited during the Indexed Term. |
• | the dollar value of the contract on the Annuity Commencement Date less any applicable premium tax; |
• | the annuity tables contained in the contract; |
• | the type of annuity option selected; and |
• | the investment results of the fund(s) selected. |
• | first, we determine the dollar amount of the first payout; |
• | second, we credit the contract with a fixed number of Annuity Units based on the amount of the first payout; and |
• | third, we calculate the value of the Annuity Units each period thereafter. |
• | The net investment factor of the Subaccount for the Valuation Period for which the Annuity Unit value is being determined, and |
• | A factor to neutralize the assumed investment return in the annuity table. |