EX-99.1 3 g73597ex99-1.txt SAMPLE HYPOTHETICAL ILLUSTRATIONS Exhibit 99.1 Exhibit 1. A. (12) Sample Hypothetical Illustrations HYPOTHETICAL ILLUSTRATIONS The following illustrations show how certain values under a sample Policy would change with different rates of fictional investment performance over an extended period of time. In particular, the illustrations show how the death benefit, cash value, and net surrender value under a Policy issued to an insured of a given age, would change over time if the premiums indicated were paid and the return on the assets in the subaccounts were a uniform gross annual rate (before any expenses) of 0%, 6% or 12%. The tables illustrate Policy values that would result based on assumptions that you pay the premiums indicated, you do not change your specified amount, and you do not take any cash withdrawals or Policy loans. Actual returns will fluctuate over time and likely will be both positive and negative. The actual values under the Policy could be significantly different from those shown even if actual returns averaged 0%, 6% and 12%, but fluctuated over and under those averages throughout the years shown. Depending on the timing and degree of fluctuation, the actual values could be substantially less than those shown, and may, under certain circumstances, result in the lapse of the Policy unless the owner pays more than the stated premium. We based the first illustration on a Policy for an insured who is a 35 year old male in the non-tobacco use, ultimate select rate class, annual premiums of $5,500, a $500,000 specified amount and death benefit Option A. This illustration also assumes cost of insurance charges based on our current cost of insurance rates. The second illustration is based on the same factors as the first illustration, except that cost of insurance rates are based on the guaranteed cost of insurance rates (based on the 1980 Commissioners Standard Ordinary Mortality Table). The amounts we show for the death benefits, cash values and net surrender values take into account (1) the daily charge for assuming mortality and expense risks assessed against each subaccount. This charge is equivalent to an annual charge of 0.90% of the average net assets of the subaccounts; (2) estimated daily expenses equivalent to an effective average annual expense level of 0.94% of the portfolios' average daily net assets; and (3) all applicable premium expense charges and cash value charges. The 0.94% average portfolio expense level assumes an equal allocation of amounts among the 42 subaccounts (this percentage does not include Janus Global portfolio because this portfolio is no longer available to new investors). We used annualized actual audited expenses incurred during 2001 as shown in the Portfolio Annual Expense Table in the Policy prospectus for the portfolios to calculate the average annual expense level. Taking into account the assumed charges of 1.84%, the gross annual investment return rates of 0%, 6% and 12% are equivalent to net annual investment return rates of -1.84%, 4.16% and 10.16% during the first 15 Policy years and -1.84%, 4.76% and 10.76% thereafter. During 2001, AEGON/Transamerica Fund Advisers, Inc. ("AEGON/Transamerica Advisers") undertook to pay those normal operating expenses of certain AEGON/Transamerica Series Fund, Inc. ("Series Fund") portfolios that exceeded a certain stated percentage of those portfolios' average daily net assets. AEGON/Transamerica Advisers has undertaken until at least April 30, 2003 to pay expenses to the extent normal operating expenses of certain portfolios of the Series Fund exceed a stated percentage of the portfolio's average daily net assets. For details on these expense limits, the amounts reimbursed by AEGON/Transamerica Advisers during 2001, and the expense ratios without the reimbursements, see the Portfolio Annual Expense Table in the Policy prospectus. Without these waivers and reimbursements, total annual expenses for the portfolios would have been greater, and the illustrations would have assumed that the assets in the portfolios were subject to an average annual expense level of 1.01%. THE HYPOTHETICAL RETURNS SHOWN IN THE TABLES ARE PROVIDED ONLY TO ILLUSTRATE THE MECHANICS OF A HYPOTHETICAL POLICY AND DO NOT REPRESENT PAST OR FUTURE INVESTMENT RATES OF RETURN. Tax charges that may be attributable to the separate account are not reflected because we are not currently making such charges. In order to produce after tax returns of 0%, 6% or 12% if such charges are made in the future, the separate account would have to earn a sufficient amount in excess of 0%, 6% or 12% to cover any tax charges. The "Premium Accumulated at 5%" column of each table shows the amount which would accumulate if you invested an amount equal to the premium to earn interest at 5% per year, compounded annually. We will furnish, upon request, a comparable illustration reflecting the proposed insured's age, gender, risk classification and desired Policy features. WESTERN RESERVE LIFE ASSURANCE CO. OF OHIO MALE AND FEMALE BOTH ISSUE AGE 55 $16,000 ANNUAL PREMIUM FOR PREFERRED NON-SMOKER, ULTIMATE SELECT RATE CLASS $1,000,000 SPECIFIED AMOUNT OPTION A - LEVEL DEATH BENEFIT THIS ILLUSTRATION IS BASED ON CURRENT COST OF INSURANCE RATES.
PREMIUMS NET ACCUMULATED DEATH BENEFIT SURRENDER VALUE CASH VALUE END OF AT 5% ASSUMING HYPOTHETICAL ASSUMING HYPOTHETICAL ASSUMING HYPOTHETICAL POLICY INTEREST GROSS ANNUAL GROSS ANNUAL GROSS ANNUAL YEAR PER YEAR RATE OF RETURN OF RATE OF RETURN OF RATE OF RETURN OF ----- ----------- ---------------------------------- -------------------------------- ---------------------------------- 0% 6% 12% 0% 6% 12% 0% 6% 12% --------- --------- ---------- ------- --------- ---------- -------- --------- ---------- 1 16,800 1,000,000 1,000,000 1,000,000 4,932 5,815 6,699 14,172 15,055 15,939 2 34,440 1,000,000 1,000,000 1,000,000 17,406 20,056 22,813 27,966 30,616 33,373 3 52,962 1,000,000 1,000,000 1,000,000 30,137 35,451 41,200 41,370 46,683 52,432 4 72,410 1,000,000 1,000,000 1,000,000 42,465 51,352 61,358 54,369 63,256 73,262 5 92,831 1,000,000 1,000,000 1,000,000 54,393 67,778 83,464 66,969 80,354 96,040 6 114,272 1,000,000 1,000,000 1,000,000 65,903 84,728 107,695 79,151 97,976 120,943 7 136,786 1,000,000 1,000,000 1,000,000 76,975 102,196 134,245 90,895 116,116 148,165 8 160,425 1,000,000 1,000,000 1,000,000 87,576 120,167 163,318 102,168 134,759 177,910 9 185,246 1,000,000 1,000,000 1,000,000 97,661 138,616 195,134 112,925 153,880 210,398 10 211,309 1,000,000 1,000,000 1,000,000 107,179 157,509 229,936 123,116 173,445 245,872 15 362,520 1,000,000 1,000,000 1,000,000 172,091 286,122 489,248 172,091 286,122 489,248 20 555,508 1,000,000 1,000,000 1,000,000 217,286 432,063 909,510 217,286 432,063 909,510 25 801,815 1,000,000 1,000,000 1,695,033 246,534 610,394 1,614,317 246,534 610,394 1,614,317 30 1,116,173 1,000,000 1,000,000 2,916,309 245,444 832,108 2,777,437 245,444 832,108 2,777,437 35 1,517,381 1,000,000 1,179,951 4,920,477 191,222 1,123,763 4,686,168 191,222 1,123,763 4,686,168 40 2,029,436 1,000,000 1,507,152 7,916,274 40,649 1,492,229 7,837,895 40,649 1,492,229 7,837,895 45 2,682,963 * 1,965,904 13,130,396 * 1,965,904 13,130,396 * 1,965,904 13,130,396 INTERNAL RATE OF INTERNAL RATE OF RETURN ON NET INTERNAL RATE OF RETURN ON CASH SURRENDER VALUE RETURN ON VALUE ASSUMING ASSUMING DEATH BENEFIT HYPOTHETICAL HYPOTHETICAL ASSUMING HYPOTHETICAL GROSS ANNUAL GROSS ANNUAL GROSS ANNUAL RATE OF RETURN OF RATE OF RETURN OF RATE OF RETURN OF ---------------------------- ------------------------------ ----------------------------------- 0% 6% 12% 0% 6% 12% 0% 6% 12% ------- ------ ------ ------- ------- ------- -------- -------- ------- -11.43% -5.91% -0.38% -69.18% -63.66% -58.13% 6150.00% 6150.00% 6150.00% -8.65% -2.91% 2.83% -34.33% -27.38% -20.55% 642.15% 642.15% 642.15% -7.25% -1.38% 4.48% -21.53% -14.41% -7.45% 258.47% 258.47% 258.47% -6.42% -0.47% 5.48% -15.75% -8.62% -1.68% 148.92% 148.92% 148.92% -5.87% 0.15% 6.15% -12.59% -5.48% 1.42% 100.39% 100.39% 100.39% -5.49% 0.58% 6.64% -10.66% -3.56% 3.29% 73.77% 73.77% 73.77% -5.22% 0.90% 7.00% -9.39% -2.29% 4.53% 57.22% 57.22% 57.22% -5.03% 1.14% 7.28% -8.51% -1.40% 5.39% 46.06% 46.06% 46.06% -4.91% 1.32% 7.50% -7.89% -0.76% 6.02% 38.07% 38.07% 38.07% -4.83% 1.46% 7.68% -7.44% -0.29% 6.50% 32.11% 32.11% 32.11% -4.29% 2.17% 8.48% -4.29% 2.17% 8.48% 16.46% 16.46% 16.46% -3.85% 2.78% 9.16% -3.85% 2.78% 9.16% 9.93% 9.93% 9.93% -3.97% 3.11% 9.56% -3.97% 3.11% 9.56% 6.48% 6.48% 9.87% -4.78% 3.34% 9.79% -4.78% 3.34% 9.79% 4.39% 4.39% 10.04% -7.20% 3.59% 9.93% -7.20% 3.59% 9.93% 3.02% 3.82% 10.13% -28.24% 3.76% 10.02% -28.24% 3.76% 10.02% 2.06% 3.80% 10.06% * 3.91% 10.11% * 3.91% 10.11% * 3.91% 10.11%
WESTERN RESERVE LIFE ASSURANCE CO. OF OHIO MALE AND FEMALE BOTH ISSUE AGE 55 $16,000 ANNUAL PREMIUM FOR PREFERRED NON-SMOKER, ULTIMATE SELECT RATE CLASS $1,000,000 SPECIFIED AMOUNT OPTION A - LEVEL DEATH BENEFIT THIS ILLUSTRATION IS BASED ON GUARANTEED COST OF INSURANCE RATES.
PREMIUMS NET ACCUMULATED DEATH BENEFIT SURRENDER VALUE CASH VALUE END OF AT 5% ASSUMING HYPOTHETICAL ASSUMING HYPOTHETICAL ASSUMING HYPOTHETICAL POLICY INTEREST GROSS ANNUAL GROSS ANNUAL GROSS ANNUAL YEAR PER YEAR RATE OF RETURN OF RATE OF RETURN OF RATE OF RETURN ------ ----------- ---------------------------------- -------------------------------- -------------------------------- 0% 6% 12% 0% 6% 12% 0% 6% 12% --------- --------- ---------- -------- ------- ---------- ------- ------- ----------- 1 16,800 1,000,000 1,000,000 1,000,000 4,932 5,815 6,699 14,172 15,055 15,939 2 34,440 1,000,000 1,000,000 1,000,000 17,406 20,056 22,813 27,966 30,616 33,373 3 52,962 1,000,000 1,000,000 1,000,000 30,137 35,451 41,200 41,370 46,683 52,432 4 72,410 1,000,000 1,000,000 1,000,000 42,462 51,349 61,355 54,366 63,253 73,259 5 92,831 1,000,000 1,000,000 1,000,000 54,361 67,746 83,431 66,938 80,322 96,007 6 114,272 1,000,000 1,000,000 1,000,000 65,809 84,631 107,595 79,058 97,879 120,843 7 136,786 1,000,000 1,000,000 1,000,000 76,773 101,984 134,024 90,694 115,904 147,944 8 160,425 1,000,000 1,000,000 1,000,000 87,206 119,775 162,905 101,798 134,367 177,497 9 185,246 1,000,000 1,000,000 1,000,000 97,043 137,955 194,433 112,308 153,219 209,697 10 211,309 1,000,000 1,000,000 1,000,000 106,208 156,462 228,823 122,144 172,398 244,759 15 362,520 1,000,000 1,000,000 1,000,000 163,144 276,765 480,113 163,144 276,765 480,113 20 555,508 1,000,000 1,000,000 1,000,000 173,040 388,033 876,878 173,040 388,033 876,878 25 801,815 1,000,000 1,000,000 1,627,413 97,770 474,287 1,549,917 97,770 474,287 1,549,917 30 1,116,173 * 1,000,000 2,766,515 * 485,972 2,634,777 * 485,972 2,634,777 35 1,517,381 * 1,000,000 4,550,554 * 240,776 4,333,861 * 240,776 4,333,861 40 2,029,436 * * 7,150,080 * * 7,079,288 * * 7,079,288 45 2,682,963 * * 11,869,848 * * 11,869,848 * * 11,869,848 INTERNAL RATE OF INTERNAL RATE OF RETURN ON NET INTERNAL RATE OF RETURN ON CASH SURRENDER VALUE RETURN ON VALUE ASSUMING ASSUMING DEATH BENEFIT HYPOTHETICAL HYPOTHETICAL ASSUMING HYPOTHETICAL GROSS ANNUAL GROSS ANNUAL GROSS ANNUAL RATE OF RETURN RATE OF RETURN RATE OF RETURN OF ---------------------------- ------------------------------ --------------------------------- 0% 6% 12% 0% 6% 12% 0% 6% 12% ------- ------ ------ ------- ------- ------- -------- -------- -------- -11.43% -5.91% -0.38% -69.18% -63.66% -58.13% 6150.00% 6150.00% 6150.00% -8.65% -2.91% 2.83% -34.33% -27.38% -20.55% 642.15% 642.15% 642.15% -7.25% -1.38% 4.48% -21.53% -14.41% -7.45% 258.47% 258.47% 258.47% -6.42% -0.47% 5.48% -15.75% -8.62% -1.68% 148.92% 148.92% 148.92% -5.88% 0.13% 6.14% -12.61% -5.49% 1.40% 100.39% 100.39% 100.39% -5.52% 0.55% 6.61% -10.70% -3.59% 3.27% 73.77% 73.77% 73.77% -5.28% 0.86% 6.96% -9.45% -2.34% 4.49% 57.22% 57.22% 57.22% -5.11% 1.08% 7.23% -8.61% -1.48% 5.34% 46.06% 46.06% 46.06% -5.02% 1.24% 7.44% -8.02% -0.86% 5.95% 38.07% 38.07% 38.07% -4.98% 1.35% 7.60% -7.61% -0.41% 6.41% 32.11% 32.11% 32.11% -5.00% 1.76% 8.26% -5.00% 1.76% 8.26% 16.46% 16.46% 16.46% -6.31% 1.80% 8.86% -6.31% 1.80% 8.86% 9.93% 9.93% 9.93% -13.76% 1.29% 9.30% -13.76% 1.29% 9.30% 6.48% 6.48% 9.61% * 0.08% 9.52% * 0.08% 9.52% * 4.39% 9.77% * -5.38% 9.60% * -5.38% 9.60% * 3.02% 9.80% * * 9.66% * * 9.66% * * 9.69% * * 9.80% * * 9.80% * * 9.80%