PLEASE READ THIS CONTRACT CAREFULLY
ANNUITY BENEFIT PAYMENTS AND OTHER VALUES PROVIDED BY THIS CONTRACT, WHEN BASED
ON THE INVESTMENT PERFORMANCE OF THE VARIABLE ACCOUNT, MAY INCREASE OR DECREASE
AND ARE NOT GUARANTEED AS TO FIXED DOLLAR AMOUNT. PLEASE REFER TO THE VALUE OF
THE VARIABLE ACCOUNT SECTION FOR ADDITIONAL INFORMATION.
VALUES REMOVED FROM A GUARANTEE PERIOD ACCOUNT PRIOR TO THE END OF ITS
GUARANTEE PERIOD MAY BE SUBJECT TO A MARKET VALUE ADJUSTMENT THAT MAY
INCREASE OR DECREASE THE VALUES. A NEGATIVE MARKET VALUE ADJUSTMENT WILL
NEVER BE APPLIED TO THE DEATH BENEFIT. A POSITIVE MARKET VALUE ADJUSTMENT,
IF APPLICABLE, WILL BE ADDED TO THE DEATH BENEFIT WHEN THE BENEFIT PAID IS
THE CONTRACT'S ACCUMULATED VALUE. PLEASE REFER TO THE MARKET VALUE ADJUSTMENT
SECTION FOR ADDITIONAL INFORMATION.
RIGHT TO EXAMINE CONTRACT
The Owner may cancel this contract by returning it to the Company or one of
its authorized representatives within ten days after receipt. If returned,
the Company will refund an amount equal to the sum of (1) gross payments,
less any amounts allocated to the Variable Account, (2) the Accumulated Value
of amounts allocated to the Variable Account on the date the returned
contract is received at the Principal Office and (3) any fees or other
charges imposed on the amounts allocated to the Variable Account. If,
however, the contract is issued as an Individual Retirement Annuity (IRA),
the Company will refund the greater of the above or the gross payments.
ALLMERICA FINANCIAL LIFE INSURANCE AND ANNUITY COMPANY
Home Office: Dover, Delaware
Principal Office: ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
This is a legal contract between Allmerica Financial Life Insurance and
Annuity Company (the Company) and the Owner and is issued in consideration of
the initial payment shown on the Specifications page. Additional payments
are permitted. Payments may be allocated to Variable Sub-Accounts, the
Fixed Account or Guarantee Period Accounts. While this contract is in
effect, the Company agrees to pay annuity benefits beginning on the Annuity
Date or to pay a death benefit to the Beneficiary if an Owner dies prior to
the Annuity Date.
FLEXIBLE PAYMENT DEFERRED VARIABLE AND FIXED ANNUITY
NON-PARTICIPATING
1
TABLE OF CONTENTS
SPECIFICATIONS........................................................... 3
DEFINITIONS.............................................................. 5
OWNER, ANNUITANT AND BENEFICIARY......................................... 7
PAYMENTS................................................................. 8
VALUES................................................................... 8
TRANSFERS................................................................ 10
▇▇▇▇▇▇▇▇▇▇ AND SURRENDER................................................. 10
DEATH BENEFIT............................................................ 11
ANNUITY BENEFIT.......................................................... 12
ANNUITY OPTION TABLES.................................................... 15
GENERAL PROVISIONS....................................................... 18
2
SPECIFICATIONS
Owner: [ ] Contract Number: [zz00600000]
Joint Owner: [ ]
Issue Date: [ ] Contract Type: [NQ]
Annuitant: [ ] Annuitant Date of Birth: [xx/xx/xx]
Joint Annuitant: [ ] Joint Annuitant Date of Birth [xx/xx/xx]
Annuitant Sex: [ ] Owner Date of Birth: [xx/xx/xx]
Joint Annuitant Sex: [ ] Joint Owner Date of Birth: [xx/xx/xx]
Annuity Date: [xx/xx/xx] Primary Beneficiary: [ ]
Contingent Beneficiary: [ ]
Minimum Fixed Account Guaranteed Interest Rate: [3%] Minimum Additional Payment: [$100.00]
Minimum Guarantee Period Account Interest Rate: [3%] Minimum Guarantee Period [$1,000.00]
Account Allocation Amount:
Minimum Withdrawal Amount: [$100.00] Minimum Accumulated Value [$1,000.00]
After Withdrawal:
Minimum Annuity Benefit Payment: [$50.00] Maximum Alternative [xx/xx/xx]
Annuity Date:
Mortality and Expense Risk Charge: [1.25%] on an annual basis of the daily value of the Sub-Account assets.
Administrative Charge: [.15%] on an annual basis of the daily value of the Sub-Account assets.
Contract Fee: [$35, if the Accumulated Value is less than $75,000.00]
[Enhanced Death Benefit Rider [.25%]
Annual Percentage Rate Charge:
[Enhanced Death Benefit Rider [5%]
Effective Annual Yield
Principal Office: ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (▇-▇▇▇-▇▇▇-▇▇▇▇)
3
SPECIFICATIONS (continued)
Owner: [ ] Contract Number:
Joint Owner: [ ] [zz00600000]
Initial Net Payment: [$25,000.00]
Initial Net Payment Allocation:
''Variable Sub-Accounts
----------------------
''[
'' ]
[There are 24 variable sub-accounts. You may invest in up to 17 over the life of your contract.]
''Fixed Account
--------------
''Initial Interest Rate:
''Guarantee Period Accounts
--------------------------
Guaranteed
``Guarantee ``Interest Expiration
````Period ``Rate ``Date
------------- ---------- -----------
[``2 years
```3 years
```4 years
```5 years
```6 years
```7 years
```8 years
```9 years
`10 years ]
____
100% TOTAL
4
DEFINITIONS
ACCUMULATED VALUE The aggregate value of all accounts in this contract before
the Annuity Date. As long as the Accumulated Value is
greater than zero, the contract will stay in effect.
ACCUMULATION UNIT A measure used to calculate the value of a Sub-Account
before annuity benefit payments begin.
ANNUITANT At issue, the person whose age is used to determine the
Annuity Date. On and after the Annuity Date, the person
upon whose continuation of life annuity benefit payments
involving life contingency depend. Joint Annuitants are
permitted and unless otherwise indicated, any reference to
Annuitant shall include joint Annuitants.
ANNUITY DATE The date annuity benefit payments begin. The Annuity Date
is shown on the Specifications page.
ANNUITY UNIT A measure used to calculate annuity benefit payments under a
variable annuity option.
BENEFICIARY The person, persons or entity entitled to the death benefit
prior to the Annuity Date or any annuity benefit payments
upon the death of an Owner who is not also an Annuitant on or
after the Annuity Date.
COMPANY Allmerica Financial Life Insurance and Annuity Company.
CONTRACT YEAR A one year period based on the date of issue or an
anniversary thereof.
FIXED ACCOUNT The part of the Company's General Account to which all or a
portion of a payment or transfer may be allocated.
FUND Each separate investment company, investment series or
portfolio eligible for investment by a Sub-Account of the
Variable Account.
GENERAL ACCOUNT All assets of the Company that are not allocated to a
Separate Account.
GUARANTEE PERIOD The number of years that a Guaranteed Interest Rate may be
credited to a Guarantee Period Account. The Guarantee
Period may range from two to ten years.
GUARANTEE PERIOD An account which corresponds to a Guaranteed Interest Rate
ACCOUNT for a specified Guarantee Period and is supported by assets in
a Separate Account.
GUARANTEED INTEREST RATE The annual effective rate of interest after daily
compounding credited to a Guarantee Period Account.
MARKET VALUE ADJUSTMENT A positive or negative adjustment to earnings in a Guarantee
Period Account assessed if any portion of a Guarantee Period
Account is withdrawn or transferred prior to the end of its
Guarantee Period.
OWNER The person, persons or entity entitled to exercise the
rights and privileges under this contract. Joint Owners are
permitted if one of the two is an Annuitant and unless
otherwise indicated, any reference to Owner shall include
joint Owners.
5
PRINCIPAL OFFICE The Company's office at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇.
PRO RATA How a payment or withdrawal may be allocated among the
accounts. A Pro Rata allocation or withdrawal will be made
in the same proportion that the value of each account bears
to the Accumulated Value.
SEPARATE ACCOUNT A segregated account established by the Company. The assets
in a Separate Account are not commingled with the Company's
general assets and obligations. The assets of a Separate
Account are not subject to claims arising out of any other
business the Company may conduct.
SUB-ACCOUNT A Variable Account subdivision that invests exclusively in
shares of a corresponding Fund.
SURRENDER VALUE The amount payable to the Owner on full surrender after
application of any Market Value Adjustment and contract fee.
TELEPHONE REQUEST A request by telephone to the Principal Office. A signed
authorization must be on file for such requests to be
honored.
VALUATION DATE A day the values of all units are determined. Valuation
Dates occur on each day the New York Stock Exchange is open
for trading, or such other dates when there is sufficient
trading in a Fund's portfolio securities so that the current
unit value may be materially affected.
VALUATION PERIOD The interval between two consecutive Valuation Dates.
VARIABLE ACCOUNT The Company's Separate Account, consisting of Sub-Accounts
that invest in the underlying Funds.
WRITTEN REQUEST A request or notice in writing satisfactory to the Company
OR WRITTEN NOTICE and filed at the Principal Office.
6
OWNER, ANNUITANT AND BENEFICIARY
OWNER When the contract is issued, the Owner will be as shown on
the Specifications page. The Owner may be changed in
accordance with the terms of this contract. Upon the death
of an Owner prior to the Annuity Date, a death benefit is paid.
The Owner may exercise all rights and options granted in
this contract or by the Company, subject to the consent of
any irrevocable Beneficiary. Where the contract is owned
jointly, the consent of both is required in order to exercise
any ownership rights.
ASSIGNMENT Prior to the Annuity Date and prior to the death of an
Owner, the Owner may be changed at any time. Only the Owner
may assign this contract. An absolute assignment will
transfer ownership to the assignee. This contract may also
be collaterally assigned as security. The limitations on
ownership rights while the collateral assignment is in
effect are stated in the assignment. Additional limitations
may exist for contracts issued under provisions of the
Internal Revenue Code.
An assignment will take place only when the Company has
received Written Notice and recorded the change at the
Principal Office. The Company will not be deemed to know of
the assignment until it has received Written Notice. When
recorded, the assignment will take effect as of the date it
was signed. The assignment will be subject to payments made
or actions taken by the Company before the change was recorded.
The Company will not be responsible for the validity of any
assignment nor the extent of any assignee's interest. The
interests of the Annuitant and the Beneficiary will be
subject to any assignment.
ANNUITANT The Annuitant will be as shown on the Specifications page
unless changed in accordance with the terms of this
contract. Prior to the Annuity Date, an Annuitant may be
replaced or added unless the Owner is a non-natural person.
At all times there must be at least one Annuitant. If an
Annuitant dies and a replacement is not named, the owner
will be considered to be the new Annuitant.
BENEFICIARY The Beneficiary is as named on the Specifications page
unless subsequently changed. The Owner may declare any
Beneficiary to be revocable or irrevocable. A revocable
Beneficiary may be changed at any time prior to the Annuity
Date and before the death of an Owner or after the Annuity
Date and before the death of an Annuitant. An irrevocable
Beneficiary must consent in writing to any change. Unless
otherwise indicated, the Beneficiary will be revocable.
A Beneficiary change must be made in writing on a
Beneficiary designation form and will be subject to the
rights of any assignee of record. When the Company receives
the form, the change will take place as of the date it was
signed, even if the Owner or Annuitant dies after the form
is signed but prior to the Company's receipt of the form.
Any rights created by the change will be subject to payments
made or actions taken by the Company before the change was
recorded.
All death benefits provided by this contract will be divided
equally among the surviving Beneficiaries of the same class,
unless the Owner directs otherwise. If there is no
surviving Beneficiary, the deceased Beneficiary's interest
will pass to the Owner or the Owner's estate.
7
PROTECTION OF PROCEEDS To the extent allowed by law, this contract and any
payments made under it will be exempt from the claims of
creditors. Neither the Annuitant nor the Beneficiary can
assign, transfer, commute, anticipate or encumber the proceeds
or payments unless given that right by the Owner.
PAYMENTS
INITIAL PAYMENT The Initial Payment is shown on the Specifications page.
ADDITIONAL PAYMENTS Prior to the Annuity Date and while the contract is in
force, the Owner may make additional payments of at least
the Minimum Additional Payment (see Specifications page).
Total payments made may not exceed $5,000,000 without the
Company's consent.
NET PAYMENTS Each Net Payment is equal to the gross payment less the
amount of any applicable premium tax. The Company reserves
the right to deduct the amount of the premium tax from the
Accumulated Value at a later date rather than when the
premium tax liability tax is first incurred by the Company.
In no event will an amount be deducted for premium taxes
before the Company has incurred a tax liability under
applicable state law.
NET PAYMENT ALLOCATIONS The initial Net Payment is allocated as shown on the
Specifications page. Additional Net Payments will be
allocated in the same proportion as the initial Net
Payment, unless changed by the Owner's Written or Telephone
Request.
The minimum amount that may be allocated to a Guarantee
Period Account is shown on the Specifications page. If the
Owner requests an allocation less than the minimum amount,
the Company reserves the right to apply that amount to the
Money Market Sub-Account.
VALUES
VALUE OF THE VARIABLE The value of a Sub-Account on a Valuation Date is determined
ACCOUNT by multiplying the Accumulation Units in that Sub-Account
by the Accumulation Unit Value as of the Valuation Date.
Accumulation Units are credited when an amount is allocated
to a Sub-Account. The number of Accumulation Units credited
equals that amount divided by the applicable Accumulation
Unit Value as of the Valuation Date.
ACCUMULATION UNIT The value of a Sub-Account Accumulation Unit as of any
VALUES Valuation Date is determined by multiplying the value of an
Accumulation Unit for the preceding Valuation Date by the
net investment factor for that Valuation Period.
NET INVESTMENT FACTOR The net investment factor measures the investment performance
of a Sub-Account from one Valuation Period to the next.
This factor is equal to 1.000000 plus the result from dividing
(a) by (b) and subtracting (c) and (d) where:
(a) is the investment income of a Sub-Account for
the Valuation Period, including realized or unrealized
capital gains and losses during the Valuation Period,
adjusted for provisions made for taxes, if any;
8
(b) is the value of that Sub-Account's assets at the
beginning of the Valuation Period;
(c) is the Mortality and Expense Risk Charge (see
Specifications page); and
(d) is the Administrative Charge (see Specifications page).
The Company assumes the risk that its actual mortality
experience and expenses may exceed the amounts provided
under the contract. The Company guarantees that the charge
for mortality and expense risks and the administrative
charge will not be increased. Subject to applicable state
and federal laws, these charges may be decreased or the
method used to determine the net investment factor may be
changed.
VALUE OF THE FIXED Amounts allocated to the Fixed Account are credited interest
ACCOUNT at rates periodically set by the Company. The Company guarantees
that the rate of interest in effect when an amount is allocated
to the Fixed Account will remain in effect for that amount for
one year. Thereafter, the rate of interest for that amount will be
the Company's current interest rate, but no less than the
Minimum Fixed Account Guaranteed Interest Rate (see
Specifications page).
The value of the Fixed Account on any date is the sum of
amounts allocated to the Fixed Account plus interest
compounded and credited daily at the rates applicable to
those amounts. The value of the Fixed Account will be at
least equal to the minimum required by law in the state in
which this contract is delivered.
VALUE OF THE GUARANTEE A Guarantee Period Account will be established on the date a
PERIOD ACCOUNTS Net Payment or transfer is allocated to a specific
Guarantee Period. Amounts allocated to the same Guarantee Period
on the same day will be treated as one Guarantee Period Account.
The interest rate in effect when an amount is allocated to a
Guarantee Period is guaranteed for the duration of the
Guarantee Period. Additional amounts allocated to Guarantee
Periods of the same or different durations will result in
additional Guarantee Period Accounts, each with its own
Guaranteed Interest Rate and expiration date.
The value of a Guarantee Period Account on any date is the
sum of the amounts allocated to that Guarantee Period
Account plus interest compounded and credited daily at the
rate applicable to that amount.
GUARANTEED INTEREST The Company will periodically set Guaranteed Interest Rates
RATES for each available Guarantee Period. These rates will be
guaranteed for the duration of the respective Guarantee Periods.
A Guaranteed Interest Rate will never be less than the Minimum
Guarantee Period Account Interest Rate (see Specifications page.)
RENEWAL GUARANTEE At least 45 days (but not more than 75 days) prior to the end of a
PERIODS Guarantee Period, the Company will notify the Owner in
writing of the expiration of that Guarantee Period. The Owner
may transfer amounts to the Sub-Accounts, the Fixed Account or
establish a new Guarantee Period Account of any duration then offered
by the Company as of the day following the expiration of the
Guarantee Period. The transfer will not be subject to a
Market Value Adjustment; see "Market Value Adjustment," page 11.
Guaranteed Interest Rates corresponding to the available Guarantee
Periods may be higher or lower than the previous Guaranteed Interest
Rate. If reallocation instructions are not received at the Principal
Office before the end of a Guarantee Period, the Guarantee Period
Account value will be automatically applied to a new Guarantee
Period Account with the same Guarantee Period unless:
9
(a) less than the Minimum Guarantee Period Account Allocation
(see Specifications page) remains in the Guarantee Period
Account on its expiration date; or
(b) the Guarantee Period would extend beyond the Annuity Date
or is no longer available.
In such cases, the Guarantee Period Account value will be
transferred to the Money Market Sub-Account.
CONTRACT FEE The Company will deduct a contract fee (see Specifications
page) Pro Rata on each contract anniversary prior to the
Annuity Date and when the contract is surrendered.
TRANSFERS
Prior to the Annuity Date, the Owner may transfer amounts
among accounts by Written or Telephone Request to the
Principal Office. Transfers to a Guarantee Period Account
must be at least equal to the Minimum Guarantee Period
Account Allocation Amount (see Specifications page). If the
Owner requests the transfer of a smaller amount to the
Guarantee Period Account, the Company may transfer that
amount to the Money Market Sub-Account.
Any transfer from a Guarantee Period Account prior to the
end of its Guarantee Period will be subject to a Market
Value Adjustment. In the case of a partial transfer from a
Guarantee Period Account the Market Value Adjustment will be
applied to the value remaining in the account.
There is no charge for the first twelve transfers per
contract year. A transfer charge of up to $25 may be
imposed on each additional transfer.
The Company reserves the right to establish and impose
reasonable rules restricting transfers. All transfers are
subject to the Company's consent.
▇▇▇▇▇▇▇▇▇▇ AND SURRENDER
Prior to the Annuity Date, the Owner may, by Written
Request, withdraw a part of the Accumulated Value or
surrender the contract for its Surrender Value.
Any withdrawal must be at least the Minimum Withdrawal
Amount (see Specifications page). A withdrawal will not be
permitted if the Accumulated Value remaining in the contract
would be less than the Minimum Accumulated Value After
Withdrawal (see Specifications page). The Written Request
must indicate the dollar amount to be paid and the accounts
from which it is to be withdrawn. A withdrawal from a
Guarantee Period Account will be subject to a Market Value
Adjustment. The Market Value Adjustment will be applied to
the value remaining in the Guarantee Period Account.
When surrendered, this contract terminates and the Company
has no further liability under it. The Surrender Value will
be based on the Accumulated Value on the Valuation Date.
10
Amounts taken from the Variable Account will be paid within
7 days of the date a Written Request is received. The
Company reserves the right to delay payments subject to the
requirements of applicable laws, rules and regulations
governing variable annuities.
Amounts taken from the Fixed Account or the Guarantee Period
Accounts will normally be paid within 7 days of receipt of a
Written Request. The Company may defer payment for up to
six months from the receipt date. If deferred for 30 days
or more, the amount payable will be credited interest at a
rate of at least 3%.
MARKET VALUE ADJUSTMENT A transfer, withdrawal or surrender from a Guarantee Period
Account after the expiration of its Guarantee Period will not
be subject to a Market Value Adjustment. A Market Value Adjustment
will apply to all other transfers or withdrawals, or to a surrender.
Amounts applied under an annuity option are treated as withdrawals
when calculating the Market Value Adjustment. The Market
Value Adjustment will be determined by multiplying the
amount taken from each Guarantee Period Account by the
market value factor. The market value factor for each
Guarantee Period Account is equal to:
n/365
(1+i)/(1+j) -1
where:
i - is the Guaranteed Interest Rate expressed as a
decimal (for example: 3% = 0.03) being credited to the
current Guarantee Period;
j - is the new Guaranteed Interest Rate, expressed as a
decimal, for a Guarantee Period with a duration equal
to the number of years remaining in the current
Guarantee Period, rounded to the next higher number of
whole years. If that rate is not available, the Company
will use a suitable rate or index allowed by the
Department of Insurance; and
n - is the number of days remaining from the Effective
Valuation Date to the end of the current Guarantee Period.
If the Guaranteed Interest Rate being credited is lower than
the new Guaranteed Interest Rate, the Market Value
Adjustment will decrease the Guarantee Period Account value.
Similarly, if the Guaranteed Interest Rate being credited
is higher than the new Guaranteed Interest Rate, the Market
Value Adjustment will increase the Guarantee Period Account
value. The Market Value Adjustment will never result in a
change to the value more than the interest earned in excess
of the Minimum Guarantee Period Account Interest Rate (see
Specifications page) compounded annually from the beginning
of the current Guarantee Period.
DEATH BENEFIT
At the death of an Owner prior to the Annuity Date, the
Company will pay to the Beneficiary a death benefit
determined as of the Valuation Date upon receipt at the
Principal Office of proof of death. If the owner is a non-
natural person, then a death benefit is paid on the death of
an Annuitant prior to the Annuity Date.
11
OWNER'S DEATH BENEFIT If an Owner dies before the Annuity Date, the death benefit will be the
BEFORE THE ANNUITY DATE greater of:
(a) the Accumulated Value increased by any
positive Market Value Adjustment; or
(b) the sum of the gross payments made under
this contract reduced proportionately to reflect all
partial withdrawals. For each withdrawal, the
proportionate reduction is calculated as the death
benefit under this option immediately prior to the
withdrawal multiplied by the withdrawal amount and
divided by the Accumulated Value immediately prior
to the withdrawal.
PAYMENT OF THE DEATH The death benefit will be paid to the Beneficiary
BENEFIT BEFORE THE within 7 days of the Effective Valuation Date unless the Owner
ANNUITY DATE has specified a death benefit annuity option.
Instead, the Beneficiary may, by Written Request, elect to:
(a) defer distribution of the death benefit
for a period no more than 5 years from the date
of death; or
(b) receive a life annuity or an annuity for a period
certain not extending beyond the Beneficiary's life
expectancy. Annuity benefit payments must begin
within one year from the date of death.
If distribution of the death benefit is deferred under (a)
or (b), any value in Guarantee Period Accounts will be
transferred to the Money Market Sub-Account. The excess, if
any, of the death benefit over the Accumulated Value will
also be transferred to the Money Market Sub-Account. The
Beneficiary may, by Written Request, effect transfers and
withdrawals, but may not make additional payments. If there
are multiple Beneficiaries, the consent of all is required.
If the sole Beneficiary is the deceased Owner's spouse, the
Beneficiary may, by Written Request, continue the contract
and become the new Owner and Annuitant subject to the
following:
(a) any value in the Guarantee Period Accounts will be
transferred to the Money Market Sub-Account;
(b) the excess, if any, of the death benefit over the
contract's Accumulated Value will also be added to
the Money Market Sub-Account;
(c) additional payments may be made; and
(d) any subsequent spouse of the new Owner, if named as the
Beneficiary, may not continue the contract.
ANNUITY BENEFIT
ANNUITY OPTIONS Annuity options are available on a fixed, variable or
combination fixed and variable basis. The annuity options
described below or any alternative option offered by the
Company may be chosen. If no option is chosen, monthly
benefit payments under a variable life annuity with payments
guaranteed for 10 years will be made.
The Owner may also elect to have the death benefit applied
under a life annuity or a period certain annuity not
extending beyond the Beneficiary's life expectancy. Such an
election may not be altered by the Beneficiary.
12
Fixed annuity options are funded through the Fixed Account.
Variable annuity options may be funded through one or more
of the Sub-Accounts. Not all Sub-Accounts may be made available.
ANNUITY BENEFIT Annuity benefit payments may be received on a monthly,
PAYMENTS quarterly, semiannual or annual basis. If the first
payment would be less than the Minimum Annuity Benefit
Payment (see Specifications page), a single payment will
be made instead. Satisfactory proof of the date of birth
of the Annuitant or Beneficiary, whichever is applicable,
must be received at the Principal Office before life annuity
benefit payments begin. Where a life annuity option has been
elected, the Company may require satisfactory proof that
the Annuitant or Beneficiary, whichever is applicable,
is alive before any payment is made.
PAYMENT OF ANNUITY If an Owner who is not also an Annuitant dies on or after
BENEFIT PAYMENTS UPON the Annuity Date the annuity benefit payments continue in
OWNER DEATH accordance with the terms of the annuity option selected.
Upon the death of the Owner, the Beneficiary becomes the
Owner of the contract.
ANNUITY VALUE The amount of the first annuity benefit payment under all
available options except period certain options will depend
on the age of the Annuitant and/or Beneficiary on the
Annuity Date and the annuity value applied. Period certain
options are based on the duration of payments and the
annuity value.
For life annuity options and non-commutable period certain
options with a duration of 10 years or more, the annuity
value will be the Accumulated Value, including any
applicable Market Value Adjustment less any applicable
premium tax. For commutable period certain options or any
period certain option less than 10 years, the annuity value
will be the Surrender Value less any applicable premium tax.
For a death benefit annuity, the annuity value will be the
amount of the death benefit. The annuity value applied
under a variable annuity option is based on the Accumulation
Unit Value on a Valuation Date not more than four weeks,
uniformly applied, before the Annuity Date.
ANNUITY UNIT VALUES A Sub-Account Annuity Unit value on any Valuation Date is
equal to its value on the preceding Valuation Date
multiplied by the product of:
(a) a discount factor equivalent to the assumed interest rate; and
(b) the net investment factor of the Sub-Account funding
the annuity benefit payments for the applicable
Valuation Period.
The value of an Annuity Unit as of any date other than a
Valuation Date is equal to its value as of the preceding
Valuation Date.
Each variable annuity benefit payment is equal to the number
of Annuity Units multiplied by the applicable value of an
Annuity Unit, except that under a Joint and Two-Thirds
Option, payments after the first death are based on
two-thirds the number of Annuity Units that applied when
both individuals on whose lives the payments were based were
living. Variable annuity benefit payments will increase or
decrease with the value of annuity units. The Company
guarantees that the amount of each variable annuity benefit
payment will not be affected by changes in mortality and
expense experience.
NUMBER OF ANNUITY UNITS The number of Annuity Units determining the benefit payable is
equal to the amount of the first annuity benefit payment divided
by the value of the Annuity Unit as of the Valuation Date used to
calculate the amount of the first payment. Once annuity benefit
payments begin, the number of Annuity Units will not change unless
a split is made.
13
ANNUITY BENEFIT PAYMENT VARIABLE OR FIXED LIFE ANNUITY WITH PAYMENTS GUARANTEED FOR
OPTIONS 10 YEARS: Periodic annuity benefit payments during the
Annuitant's life. If the Annuitant dies before all
guaranteed payments have been made, the remaining guaranteed
payments will continue to the Owner.
VARIABLE OR FIXED LIFE ANNUITY: Periodic annuity benefit
payments during the Annuitant's life.
UNIT REFUND VARIABLE OR FIXED LIFE ANNUITY: Periodic
annuity benefit payments during the Annuitant's life. If
the Annuitant dies and the annuity value initially applied
to purchase the option, divided by the first payment,
exceeds the number of payments made before the Annuitant's
death, payments will continue to the Owner until the number
of payments equals the Annuity Value divided by the first
payment.
JOINT AND SURVIVOR VARIABLE OR FIXED LIFE ANNUITY: Periodic
annuity benefit payments during the joint lifetime of the
Annuitant and another individual (i.e. the Beneficiary or a
Joint Annuitant) with payments continuing during the
lifetime of the survivor.
JOINT AND TWO-THIRDS SURVIVOR VARIABLE OR FIXED LIFE
ANNUITY: Periodic annuity benefit payments during the
joint lifetime of the Annuitant and one other individual
(i.e. the Beneficiary or a joint Annuitant) with payments
continuing during the lifetime of the survivor at two-thirds
the amount payable when both individuals were living.
VARIABLE OR FIXED ANNUITY FOR A PERIOD CERTAIN: Periodic
annuity benefit payments for a chosen number of years. The
number of years selected may be from 1 to 30. If the payee
dies before the end of the period, remaining payments will
continue to the Owner.
ANNUITY TABLES The first annuity benefit payment will be based on the
greater of the guaranteed annuity rates shown in the
following tables or the Company's non-guaranteed current
annuity option rates applicable to this class of contracts.
Second and subsequent annuity benefit payments, when based
on the investment experience of the Variable Account, may
increase or decrease.
14
ANNUITY OPTION TABLES
FIRST MONTHLY ANNUITY BENEFIT PAYMENT
FOR EACH $1,000 OF ANNUITY VALUE APPLIED
Age Life Annuity with
Nearest Payments Guaranteed Life Unit Refund
Birthday for 10 Years Annuity Life Annuity
50 4.20 4.22 4.12
51 4.26 4.28 4.17
52 4.32 4.35 4.23
53 4.38 4.42 4.29
54 4.45 4.49 4.35
55 4.53 4.57 4.41
56 4.60 4.65 4.48
57 4.68 4.73 4.55
58 4.77 4.83 4.63
59 4.86 4.92 4.71
60 4.95 5.03 4.79
61 5.05 5.14 4.88
62 5.16 5.26 4.97
63 5.27 5.38 5.07
64 5.39 5.52 5.17
65 5.51 5.66 5.28
66 5.64 5.82 5.39
67 5.78 5.98 5.51
68 5.92 6.16 5.64
69 6.07 6.35 5.78
70 6.23 6.56 5.92
71 6.39 6.77 6.07
72 6.56 7.01 6.23
73 6.73 7.26 6.40
74 6.91 7.54 6.57
75 7.09 7.83 6.76
These tables are based on an annual interest rate of 3 1/2%
and the Annuity 2000 Mortality Table.
15
ANNUITY OPTION TABLES (CONTINUED)
FIRST MONTHLY ANNUITY BENEFIT PAYMENT
FOR EACH $1,000 OF ANNUITY VALUE APPLIED
Joint and Survivor Life Annuity
Older Age
50 55 60 65 70 75 80
Y 50 3.82 3.90 3.96 4.01 4.05 4.08 4.09
O
U 55 4.06 4.16 4.25 4.32 4.36 4.39
N
G 60 4.38 4.52 4.64 4.72 4.78
E
R 65 4.82 5.01 5.17 5.28
70 5.42 5.69 5.91
A
G 75 6.28 6.67
E
80 7.52
Joint and Two-Thirds Survivor Life Annuity
Older Age
50 55 60 65 70 75 80
Y 50 4.09 4.23 4.38 4.55 4.74 4.93 5.13
O
U 55 4.40 4.58 4.78 5.00 5.22 5.45
N
G 60 4.81 5.05 5.31 5.58 5.86
E
R 65 5.37 5.70 6.04 6.38
70 6.16 6.59 7.04
A
G 75 7.27 7.87
E
80 8.86
These tables are based on an annual interest rate of 3 1/2%
and the Annuity 2000 Mortality Table.
16
FIRST MONTHLY ANNUITY BENEFIT PAYMENT
FOR EACH $1,000 OF ANNUITY VALUE APPLIED
Number of Variable or Fixed Annuity for a Number of Variable or ▇▇▇▇▇ ▇▇▇▇▇▇▇ for a
Years Period Certain Years Period Certain
1 84.65 16 6.76
2 43.05 17 6.47
3 29.19 18 6.20
4 22.27 19 5.97
5 18.12 20 5.75
6 15.35 21 5.56
7 13.38 22 5.39
8 11.90 23 5.24
9 10.75 24 5.09
10 9.83 25 4.96
11 9.09 26 4.84
12 8.46 27 4.73
13 7.94 28 4.63
14 7.49 29 4.53
15 7.10 30 4.45
These tables are based on an annual interest rate of 3 1/2%.
17
GENERAL PROVISIONS
ENTIRE CONTRACT The entire contract consists of this contract, any
application attached at issue and any endorsements.
MISSTATEMENT OF AGE If the age of an individual is misstated, the Company
will adjust all benefit payable to that which would be
available at the correct age. Any underpayments already
made by the Company will be paid immediately. Any
overpayments will be deducted from future annuity
benefits.
MODIFICATIONS Only the President, a Vice President or Secretary of the
Company may modify or waive any provisions of this
contract. Agents or Brokers are not authorized to do so.
INCONTESTABILITY The Company cannot contest this contract after it has
been in force for more than two years from the date of
issue.
CHANGE OF ANNUITY The Owner may change the Annuity Date by Written Request
DATE at any time after the contract has been issued. The
request must be received at the Principal Office at least
one month before the new Annuity Date. The new Annuity
Date must be the first of any month prior to the
Maximum Alternative Annuity Date shown on the
Specifications page.
MINIMUMS All values, benefits or settlement options available
under this contract equal or exceed those required by the
state in which the contract is delivered.
ANNUAL REPORT The Company will furnish an annual report to the Owner
containing a statement of the number and value of
Accumulation Units credited to the Sub-Accounts, the
value of the Fixed Account and the Guarantee Period
Accounts and any other information required by applicable
law, rules and regulations.
ADDITION, DELETION, The Company reserves the right, subject to compliance
OR SUBSTITUTION OF with applicable law, to add to, delete from, or
INVESTMENTS substitute for the shares of a Fund that are held by
the Sub-Accounts or that the Sub-Accounts may purchase.
The Company also reserves the right to eliminate the
shares of any Fund no longer available for investment
or if the Company believes further investment in the
Fund is no longer appropriate for the purposes of the
Sub-Accounts.
The Company will not substitute shares attributable to
any interest in a Sub-Account without notice to the
Owner and prior approval of the Securities and Exchange
Commission as required by the Investment Company Act of
1940. This will not prevent the Variable Account from
purchasing other securities for other series or classes
of contracts, or from permitting a conversion between
series or classes of contracts on the basis of requests
made by Owners.
The Company reserves the right, subject to compliance
with applicable laws, to establish additional Separate
Accounts, Guarantee Period Accounts and Sub-Accounts
and to make them available to any class or series of
contracts as the Company considers appropriate.
Each new Separate Account or Sub-Account will invest
in a new investment company, or in shares of another
open-end investment company, or such other investments
as may be permitted under applicable law. The Company
also reserves the right to eliminate or combine existing
Sub-Accounts and to transfer the assets of any
Sub-Accounts to any other Sub-Accounts. In the event of
any substitution or change, the Company may, by
appropriate notice, make such changes in this and
other contracts as may be necessary or appropriate
to reflect the substitution or change. If the Company
considers it to be in the
18
best interests of contract Owners, the Variable Account
or any Sub-Account may be operated as a management
company under the Investment Company Act of 1940 or in
any other form permitted by law, or may be deregistered
under that Act in the event registration is no longer
required, or may be combined with other accounts of the
Company.
CHANGES IN LAW The Company reserves the right to make any changes to
provisions of the contract to comply with, or give
Owners the benefit of, any federal or state statute,
rule, or regulation.
CHANGE OF NAME Subject to compliance with applicable law, the Company
reserves the right to change the names of the Variable
Account or the Sub-Accounts.
FEDERAL TAX The Variable Account is not currently subject to tax,
CONSIDERATIONS but the Company reserves the right to assess a charge
for taxes if the Variable Account becomes subject to tax.
SPLITTING OF UNITS The Company reserves the right to split the value of a
unit, either to increase or decrease the number of
units. Any splitting of units will have no material
effect on the benefits, provisions or investment return
of this contract or upon the Owner, the Annuitant,
any Beneficiary, or the Company.
INSULATION OF The investment performance of Separate Account assets
SEPARATE ACCOUNT is determined separately from the other assets of the
Company. The assets of a Separate Account equal to
the reserves and liabilities of the contracts supported
by the account will not be charged with liabilities from
any other business that the Company may conduct.
19
Flexible Payment Deferred Variable and Fixed Annuity
Annuity Benefits Payable on the Annuity Date
Death Benefit Payable to Beneficiary if Owner Dies prior to Annuity Date
Non-Participating
7-98-30
20
ALLMERICA FINANCIAL LIFE INSURANCE AND ANNUITY COMPANY
ENHANCED DEATH BENEFIT RIDER
This Rider is part of the policy to which it is attached and is effective on
the Date of Issue of the contract.
BENEFIT - The "Owner's Death Benefit Before the Annuity Date" provision on
page 12 of the contract is replaced by the following:
If an Owner dies before the Annuity Date and before the oldest Owner's [90th]
birthday, the death benefit will be the greater of:
(a) the Accumulated Value increased by any positive Market Value
Adjustment;
(b) gross payments accumulated daily at the Death Benefit Effective
Annual Yield shown on the Specifications page, starting on the
Effective Valuation Date of each gross payment, reduced
proportionately to reflect withdrawals. For each withdrawal,
the proportionate reduction is calculated as the death benefit
immediately prior to the withdrawal multiplied by the withdrawal
amount and divided by the Accumulated Value immediately prior to
the withdrawal; or
(c) The highest Accumulated Value increased by any positive Market Value
Adjustment on any contract anniversary, increased for subsequent
payments and reduced proportionately for subsequent withdrawals.
If an Owner dies before the Annuity Date but after the oldest Owner's
[90th] birthday, the death benefit will be the greater of:
(a) the Accumulated Value increased by any positive Market Value
Adjustment or
(b) the death benefit that would have been payable on the contract
anniversary following the oldest Owner's [90th] birthday,
increased for subsequent payments and reduced proportionately
for subsequent withdrawals.
CHARGE - The Company will assess a monthly rider charge which will be
deducted Pro Rata on the last day of each month and on the date the Rider
terminates. The charge will be equal to the Accumulated Value on that date
multiplied by 1/12th of the Enhanced Death Benefit Annual Percentage Rate
shown on the Specifications Page.
TERMINATION - This Rider will terminate on the earliest of the following:
-the Annuity Date;
-payment of the death benefit;
-surrender of the contract; or
-receipt of the Owner's Written Request to terminate the Rider.
Signed for the Company at Dover, Delaware
7-98-31