LONG TERM CARE AGREEMENT
This agreement is a part of the policy to which it is attached and is subject
to all its terms and conditions. This agreement is effective as of the
policy date of this policy unless a different effective date is shown on the
policy data pages.
DISCLOSURES
CAUTION
THE ISSUANCE OF THIS LONG TERM CARE INSURANCE AGREEMENT IS BASED UPON YOUR
RESPONSES TO THE QUESTIONS ON YOUR APPLICATION. A COPY OF YOUR APPLICATION
IS ENCLOSED. IF YOUR ANSWERS ARE INCORRECT OR UNTRUE, THE COMPANY HAS THE
RIGHT TO DENY BENEFITS OR RESCIND THIS AGREEMENT. THE BEST TIME TO CLEAR UP
ANY QUESTIONS IS NOW, BEFORE A CLAIM ARISES! IF, FOR ANY REASON, ANY OF YOUR
ANSWERS ARE INCORRECT, CONTACT THE COMPANY AT THE ADDRESS SHOWN ON YOUR
POLICY.
QUALIFIED LONG-TERM CARE TAX OBLIGATION
THIS AGREEMENT IS INTENDED TO BE A TAX QUALIFIED LONG-TERM CARE INSURANCE
BENEFIT UNDER SECTION 7702B(b) OF THE INTERNAL REVENUE CODE, AS AMENDED.
BENEFITS PAID UNDER THIS ACCELERATED BENEFIT AGREEMENT FOR LONG-TERM CARE
COVERAGE MAY BE TAXABLE. IF SO, YOU OR YOUR BENEFICIARY MAY INCUR A TAX
OBLIGATION. AS WITH ALL TAX MATTERS, YOU SHOULD CONSULT YOUR PERSONAL TAX
ADVISOR TO ASSESS THE IMPACT OF THIS BENEFIT.
RECEIPT OF ACCELERATED DEATH BENEFITS UNDER THIS AGREEMENT MAY ADVERSELY
AFFECT YOUR ELIGIBILITY FOR GOVERNMENTAL BENEFITS OR PUBLIC ASSISTANCE
PROGRAMS SUCH AS MEDICAID.
BRIEF DESCRIPTION
THIS IS A TAX QUALIFIED LONG-TERM CARE INSURANCE AGREEMENT THAT COVERS
NURSING CARE AND HOME AND COMMUNITY BASED CARE AS DEFINED IN THIS AGREEMENT.
THIS AGREEMENT PROVIDES FOR THE PAYMENT OF A MONTHLY BENEFIT FOR QUALIFIED
LONG-TERM CARE SERVICES.
NOTICE TO OWNER
THIS AGREEMENT MAY NOT COVER ALL OF THE COSTS ASSOCIATED WITH LONG-TERM CARE
THAT THE INSURED INCURS. YOU ARE ADVISED TO REVIEW ALL BENEFIT LIMITATIONS
CAREFULLY.
THIS AGREEMENT IS NOT MEDICARE SUPPLEMENT COVERAGE.
IF THE INSURED IS ELIGIBLE FOR MEDICARE, REVIEW THE GUIDE TO HEALTH INSURANCE
FOR PEOPLE WITH MEDICARE AVAILABLE FROM US.
RENEWABILITY
This agreement is guaranteed renewable. This means that we may not, on our
own, cancel or reduce coverage provided by this agreement. Subject to the
termination provision in the Additional Information section of this
agreement, this agreement will remain in force for as long as the policy
remains in force and there is sufficient accumulation value to cover the
charges for this agreement. We have the right to change the charges for this
agreement as provided in the Charges section of this agreement.
NOTICE OF YOUR RIGHT TO EXAMINE THIS AGREEMENT
You may return this agreement for any reason within 30 days after its
delivery by taking it or mailing it to us or to any life insurance agent
appointed by us. Immediately upon return to us, this agreement will be
deemed void from the beginning. Any charges assessed for this agreement will
be restored to the accumulation value.
TABLE OF CONTENTS
Definitions 2
Provisions 4
Exclusions and Limitations 5
Pre-Existing Conditions or Diseases 5
Charges 5
Claim Procedures 6
Payment of Benefits 7
Effect of Benefit Payments 7
Additional Information 8
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DEFINITIONS
ACTIVITIES OF DAILY LIVING
The activities of daily living (ADLs) refer to those activities that measure
the insured's ability for self care. The six (6) ADLs that are used for
determination of eligibility for benefits under this agreement are:
(1) Bathing: Washing oneself by sponge bath; or in either a tub or
shower, including the task of getting into or out of the tub or shower.
(2) Continence: The ability to maintain control of bowel and bladder
function; or, when unable to maintain control of bowel or bladder
function, the ability to perform associated personal hygiene (including
caring for a catheter or colostomy bag).
(3) Dressing: Putting on and taking off all items of clothing and any
necessary braces, fasteners or artificial limbs.
(4) Eating: Feeding oneself by getting food into the body from a
receptacle (such as a plate, cup or table) or by a feeding tube or
intravenously.
(5) Toileting: Getting to and from the toilet, getting on and off the
toilet, and performing associated personal hygiene.
(6) Transferring: Moving into or out of a bed, chair or wheelchair.
ADULT DAY CARE
A program of services provided during the day to chronically ill individuals
in a community group setting through an adult day care center that includes:
(1) care for six (6) or more individuals; and
(2) social and health-related services; and
(3) maintenance or personal care services.
The purpose of such a program is to support frail, impaired elderly or other
disabled adults who can benefit from care in a group setting outside the home.
ADULT DAY CARE CENTER
A facility licensed or certified under state law, if any, to provide Adult
Day Care to adults who do not require 24-hour institutional care, but are not
capable of full-time, independent living.
ALTERNATIVE PLAN OF CARE
An alternative plan of care is one which may be employed at some point in the
future to pay for services not specifically shown as being available under
this agreement.
ASSISTED LIVING FACILITY
A place which:
(1) is licensed or certified under state law, where licensing is
required, to perform the services it is providing; and
(2) has at least one trained staff member on duty 24 hours per day; and
(3) provides continuous room and board; and
(4) provides maintenance or personal care services required by residents
due to their inability to perform two or more of the activities of
daily living or due to a severe cognitive impairment.
Assisted living facilities do not include hospitals. Unless otherwise
excluded in this agreement, assisted living facilities include facilities
otherwise named, which meet the above criteria, including secure Alzheimer's
units.
CHRONICALLY ILL INDIVIDUAL
An insured who has been certified by a Licensed Health Care Practitioner as:
(1) being unable to perform, without substantial assistance from another
person, at least two (2) Activities of Daily Living due to a loss of
functional capacity. In addition, this loss of functional capacity
must, at first, be expected to exist for a period of at least 90 days;
or
(2) requiring substantial supervision to protect the person from threats
to health and safety due to Severe Cognitive Impairment.
ELIMINATION PERIOD
The elimination period is the required period of time for which no benefits
are payable following the date the insured is determined to be eligible for
benefits.
(1) The elimination period is 90 days.
(2) The elimination period starts on the first day that qualified
long-term care services are received.
(3) The 90 days need not be continuous; however, if the gap in
continuous days exceeds 180 days, the 90-day elimination period will
start over.
(4) Benefits will not be paid until the elimination period is satisfied.
(5) Benefits will not be paid retroactively for services received during
the elimination period.
(6) The elimination period has to be satisfied only once while this
agreement is in effect.
(7) For each day of qualified service received, one day of the
elimination period is satisfied.
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HANDS-ON ASSISTANCE
Hands-on assistance is the physical assistance of another person without
which the insured would be unable to perform an activity of daily living.
HIPAA
The federal Health Insurance Portability and Accountability Act of 1996
amended 2003.
HOME AND COMMUNITY BASED CARE
Home and community based care includes qualified long term care services
provided to the insured through adult day care or home health care.
HOME HEALTH CARE
Home health care is a program of medical and non-medical services provided to
ill, disabled or infirm persons through a home health care provider licensed
in the state, including:
(1) professional nursing care by, or under the supervision of, a registered
nurse; or
(2) care by a home health aide; or
(3) therapeutic care services by or under the supervision of a speech,
occupational, physical, or respiratory therapist licensed or certified
under state law, if any, or a registered dietician; or
(4) homemaker services.
Home health care is provided in a setting other than a hospital, nursing care
facility or assisted living facility. It refers to the insured receiving
medical or non-medical services from a licensed home health care provider in
the insured's private home or an adult day care center.
HOME HEALTH CARE PROVIDER
A licensed home health care provider or licensed adult day care center or
home health care giver. This also includes an employee of a hospital acting
in the capacity of providing care in a private home.
HOMEMAKER SERVICES
Homemaker services are necessary services provided in a home as required
pursuant to a plan of care for a chronically ill individual.
HOSPITAL
A hospital is an institution or facility that is licensed as a hospital by
the proper authority of the state in which it is located; or accredited as a
hospital by the Joint Commission on Accreditation of Hospitals.
INFORMAL CARE
Qualified long-term care services provided by non-licensed providers or
persons who may or may not be paid for their services but are part of the
approved plan of care.
IMMEDIATE FAMILY
Immediate family is the insured's or your spouse or legal partner, child,
parent, grandparent, grandchild, brothers and sisters and their spouses or
legal partners.
LICENSED HEALTH CARE PRACTITIONER
A licensed health care practitioner is any physician, as defined in Section
1861(r)(1) of the Social Security Act registered professional nurse, or
licensed social worker, or other individual who meets requirements prescribed
by the Secretary of the Treasury.
A licensed health care practitioner does not include you, the insured, or a
member of your or the insured's immediate family.
LONG TERM CARE (LTC) AMOUNT
The LTC amount is an amount that represents the maximum total amount of
benefits available under this agreement. The LTC Amount is shown on the
policy data pages.
MAINTENANCE OR PERSONAL CARE SERVICES
Maintenance or personal care services are any services provided primarily to
give needed assistance to the insured as a result of being a chronically ill
individual.
MEDICARE
The name given to coverage under the federal Health Insurance for the Aged
Act, Title XVIII of the Social Security Amendments of 1965 as then
constituted or later amended.
NURSING CARE
Nursing care is providing qualified-long term care services to the insured in
a nursing care facility or assisted living facility, or providing maintenance
or personal care services in an assisted living facility.
NURSING CARE FACILITY
A facility or institution, other than a hospital, that:
(1) is licensed or certified by the state in which it is located; and
(2) is a separate facility or a distinct part of another health care
facility; and
(3) provides 24-hour per day nursing care under the supervision of a
registered nurse (RN) or physician; and
(4) maintains a daily record on each patient.
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PLAN OF CARE
A written plan for qualified long-term care services prescribed by a licensed
health care practitioner based upon an assessment indicating the insured is a
chronically ill individual. This plan of care must specify the type,
frequency, and most appropriate types of providers of all the services the
insured person requires.
PROOF OF LOSS
Proof of loss means detailed written documentation satisfactory to us which
describes and confirms the insured is chronically ill and is receiving care
that is covered by this agreement. This documentation includes, but is not
limited to:
(1) the completed proof of loss forms; and
(2) confirmation of the certification of chronic illness by a licensed
health care practitioner; and
(3) copies of medical records; and
(4) copies of the licensed health care practitioner's daily notes of
care; and
(5) copies of itemized bills for the insured's care and services or
documentation that informal care is being received; and
(6) copies of the insured's original and current plan of care.
QUALIFIED LONG-TERM CARE SERVICES
Qualified long-term care services are necessary diagnostic, preventative,
therapeutic, curing, treating, mitigating and rehabilitative services, and
maintenance or personal care services, including approved informal care,
which are required by the insured when chronically ill, and are provided
pursuant to a plan of care prescribed by a licensed health care practitioner.
SEVERE COGNITIVE IMPAIRMENT
A severe cognitive impairment is the deterioration or loss of intellectual
capacity, which requires substantial assistance by another person to protect
the insured or others from threats to health and safety. It is measured by
clinical evidence and standardized tests that reliably measure the insured's
impairment in short or long term memory; the insured's orientation as to
person (such as who he or she is), place (such as his or her location) and
time (such as day, date and year); and deductive or abstract reasoning.
Severe cognitive impairment includes Alzheimer's disease and similar forms of
irreversible dementia.
STAND-BY ASSISTANCE
Stand-by assistance is the presence of another person within arm's reach of
the insured person that is necessary to prevent, by physical intervention,
injury to the insured person while performing any activity of daily living.
SUBSTANTIAL ASSISTANCE
The hands-on or stand-by physical assistance of another person to protect the
insured person or others from threats to health or safety (such as may result
from wandering) or help with performing the activities of daily living; or
the presence of another person within arm's reach that is necessary to
prevent, by physical intervention, injury to the insured person while he or
she is performing necessary tasks.
WE, US, OUR
Minnesota Life Insurance Company
YOU, YOUR
The owner of the policy to which this agreement is attached and made a part.
PROVISIONS
What does this agreement provide?
This agreement provides for the payment of a monthly benefit for qualified
long-term care services received from nursing care or home and community
based care.
The benefit is an acceleration of the death benefit of the policy to which
this agreement is attached. The benefit will reduce the policy death benefit
and accumulation value.
WHAT IS THE MONTHLY BENEFIT AMOUNT?
The monthly benefit amount is equal to the lesser of:
(1) the monthly benefit percentage as shown on the policy data pages
multiplied by the LTC amount; or
(2) the per diem amount allowed by the Health Insurance Portability and
Accountability Act of 1996 (HIPAA) times the number of days in the
month.
WHAT HAPPENS TO THE LTC AMOUNT IF THE FACE AMOUNT OF THE POLICY IS REDUCED?
If the face amount of the policy is reduced, the LTC amount is set equal to
the lesser of the LTC amount that existed immediately prior to the change in
the face amount and the new face amount.
WHAT HAPPENS TO THE LTC AMOUNT IF A PARTIAL SURRENDER IS TAKEN?
If a partial surrender occurs, the LTC amount is set equal to the LTC amount
that was in effect immediately prior to the partial surrender, multiplied by
the ratio of the death benefit of the policy (without regard to policy loan)
after the partial surrender to the death benefit of the policy (without
regard to policy loan) immediately prior to the partial surrender.
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WHAT HAPPENS TO THE LTC AMOUNT IF WE MAKE A PAYMENT AS A RESULT OF THE
EXERCISE OF THE ACCELERATED DEATH BENEFIT AGREEMENT?
If your policy has the Accelerated Death Benefit Agreement attached and you
exercise the payment of an accelerated death benefit, the LTC amount will be
recalculated. At the point of such payment the LTC amount is determined by
taking the lesser of:
(1) the LTC amount that existed immediately prior to the accelerated
death benefit payment, and
(2) the death benefit (without regard to policy loan) immediately prior to
the payment of the accelerated death benefit payment, minus the
accelerated death benefit payment from that amount.
WHAT ARE THE ELIGIBILITY REQUIREMENTS FOR THE PAYMENT OF BENEFITS?
In order for benefits to be payable, the following requirements must be met.
(1) The insured must be certified by a licensed health care practitioner as
being a chronically ill individual, and expected to remain so for at
least 90 calendar days; and
(2) The insured must be receiving qualified long-term care services covered
under this agreement which are specified in a plan of care; and
(3) The plan of care must be submitted to us; and
(4) The elimination period must be satisfied.
EXCLUSIONS AND LIMITATIONS
You are not eligible to receive benefits if your long-term care service needs
are caused directly or indirectly by, result in whole or in part, from or
during, or there is contribution from:
(1) committing or attempting to commit a felony; or
(2) a mental, psychoneurotic, or personality disorder without evidence
of organic disease (Alzheimer's Disease and senile dementia are not
excluded from coverage); or
(3) alcoholism or drug addiction, including prescription medication; or
(4) active service in the armed forces or units auxiliary thereto; or
(5) war or any act of war, whether declared or undeclared; or
(6) any intentionally self-inflicted injury or suicide attempt (whether
sane or insane); or
(7) any condition for which the insured received treatment outside of
the United States, its territories or Canada; or
(8) any condition which was the result of the use of alcohol or drugs
and associated mental health issues (except Alzheimer's Disease),
medications, poisons, gases, fumes or other substances taken, absorbed,
inhaled, ingested or injected; or
(9) any condition that was the result of a motor vehicle collision or
accident where the insured is the operator of the motor vehicle and his
or her blood alcohol level meets or exceeds the level at which
intoxication is defined in the state where the collision or accident
occurred, regardless of the outcome of any legal proceedings connected
thereto; or
(10) any pre-existing conditions or diseases unless this agreement is
replacing existing coverage.
PRE-EXISTING CONDITIONS OR DISEASES EXCLUSION
Pre-existing conditions or diseases refers to any condition or disease for
which the insured received medical advice or treatment within six (6) months
preceding the effective date of this agreement for that same condition or
disease or a related condition or disease. There does not need to be a
specific diagnosis for the condition or disease for it to be considered a
pre-existing condition.
We will not pay benefits for qualified long-term care services needed in
total or in part from a pre-existing condition or disease which is not
disclosed in the application Days of services received by the insured for a
pre-existing condition during the first six (6) months that this agreement is
in force will not be counted toward the satisfaction of the elimination
period.
CHARGES
IS THERE A CHARGE FOR THIS AGREEMENT?
Yes. There is a monthly charge for this agreement assessed against the
policy accumulation value. The charge for this agreement is equal to the LTC
cost of insurance rate multiplied by the LTC net amount at risk. The maximum
monthly LTC cost of insurance rate for this agreement is shown on the policy
data pages. The LTC net amount at risk will equal the greater of zero and
the LTC amount minus a proportionate amount of the policy accumulation value.
The proportion is equal to the LTC amount divided by the policy face amount.
Charges for this agreement are subject to change. Any change made to the
monthly rate will not exceed the maximum monthly LTC rate shown on the policy
data pages. Any such change will be on a uniform basis for insureds of the
same gender, risk class, and age when this agreement became effective. We
will send you a notice 60 days in advance of any change in the rate for this
agreement. This notice will be sent to your last known address, and to any
assignee or designated third party shown in our records.
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CLAIM PROCEDURES
HOW DO YOU NOTIFY US OF A CLAIM?
Written notice of claim must be sent to us at our Home Office in St. ▇▇▇▇,
Minnesota within 30 days after such covered loss starts and the elimination
period has been satisfied. The notice should include your name, the
insured's name and policy number. If it was not reasonably possible to give
written notice in the time required, we shall not reduce or deny the claim
for this reason if notice is given as soon as reasonably possible. In any
event, the proof required must be given no later than one year from the time
specified unless you were legally incapacitated.
WHAT FORMS MUST BE SUBMITTED TO FILE A CLAIM?
Once notice of claim is received, we will send you forms for filing proof of
loss. If these forms are not sent to you within 15 days of our receipt of
written notice of claim, you may submit the proof of loss requirements. You
may submit these by giving us a written statement of the nature and extent of
the loss within the time limit stated in the question below "Is there a time
limit on providing proof of loss".
Each month we will require proof of loss be submitted to us. Monthly benefit
payments will not be made if proof of loss is not received.
Recertification by a licensed health care practitioner that the insured is a
chronically ill individual will be required at a minimum annually. We will
never require recertification of chronic illness more frequently than monthly.
A revised plan of care must be provided to us within 30 days if the insured's
condition changes and the plan of care is revised. You must notify us in
writing immediately if the insured's plan of care indicates the insured is no
longer eligible for qualified long-term care services. We will request
updates of the plan of care annually or as often as reasonably required but
no more frequently than once every 30 days. Only one plan of care may be in
effect at a time.
IS THERE A TIME LIMIT ON PROVIDING PROOF OF LOSS?
Yes. Proof of loss must be given to us at our Home Office in St. ▇▇▇▇,
Minnesota within 90 days after such loss begins and the elimination period
has been satisfied. If it was not reasonably possible to give written proof
in the time required, we shall not reduce or deny the claim for this reason.
In any event, the proof required must be given no later than one year from
the time specified unless you are legally incapacitated.
IS THERE A TIME LIMIT ON LEGAL ACTION?
Yes. No legal action may be brought to recover under this agreement within
60 days after written proof of loss has been given as required by this
agreement. No such action may be brought after the expiration of the
applicable statute of limitations from the time written proof of loss is
required to be given.
DO WE HAVE THE RIGHT TO OBTAIN INDEPENDENT MEDICAL VERIFICATION?
Yes. If we require the insured to be medically examined to verify that the
eligibility requirements for benefit payments are met, we may do this as
often as reasonably required while benefits are being considered or paid.
If we request verification more frequently than on an annual basis, we will
do so at our own expense.
WHAT IS THE PROCESS FOR CLAIM APPEALS?
We will evaluate your claim based on the provisions of this agreement and the
information given by you, the insured, your licensed health care practitioner
and other available sources. We will inform you in writing if we deny your
claim or any part of your claim.
If you do not agree with our claim decision, you or your representative may
appeal the denial. To appeal our claim decision, you must send us a written
request which includes all information that pertains to the claim. No
special form is needed for this appeal. Your appeal request must be sent to
us within 30 days of your receipt of our decision.
We will review your request and notify you or your representative of our
decision.
WHAT HAPPENS IF BENEFITS ARE OVERPAID?
If benefits are overpaid, we have the right to recover any overpayment of
benefits.
We will recover any overpayment by first offsetting any unpaid benefits.
If there are not sufficient unpaid benefits to allow for full recovery, we
will:
(1) withhold any future benefit payments; then
(2) ▇▇▇▇ you for the remaining amount until full recovery has been made.
If at the time of death there is an outstanding overpayment of benefits, you,
or your legal representative, may return the overpayment to us. If the
overpayment is returned to us prior to our payment of the death proceeds, the
overpayment will be included in the death benefit paid to the policy
beneficiary. If the entire overpayment is not returned to us, we will reduce
the death benefit by the amount of the overpayment.
WHAT HAPPENS IF THE INSURED IS NO LONGER RECEIVING BENEFITS FOR CARE THAT IS
COVERED BY THIS AGREEMENT?
You must notify us immediately if the insured is no longer receiving care
that is covered by this agreement. If the insured is not receiving care
covered by this agreement, no benefits will be paid.
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PAYMENT OF BENEFITS
TO WHOM WILL BENEFITS BE PAID?
All benefits will be paid to you provided you are legally competent at the
time of payment. You can validly assign them to a named alternative payee as
designated by you or your legal representative provided you are legally
competent at the time of assignment.
WHEN WILL BENEFITS BE PAID?
Benefits for any loss covered under this agreement will be paid monthly when
the insured satisfies the eligibility requirements and we receive written
proof of loss.
WHAT DOES NON-DUPLICATION OF BENEFITS MEAN?
Non-duplication of benefits means benefits are not payable under this
agreement for:
(1) expenses incurred to the extent that such expenses are reimbursable
under Medicare, or would be so reimbursable, but for the application
of a deductible or coinsurance amount; or
(2) any other state or federal workers' compensation plan, or other
governmental program (except Medicaid).
For purposes of satisfying the elimination period, days on which you satisfy
the eligibility for the payment of benefits provision, but coverage is
excluded due to the non-duplication of benefits provision, will count towards
satisfaction of the elimination period.
WHAT HAPPENS IF THE INSURED DIES WHILE RECEIVING BENEFIT PAYMENTS?
The remaining death benefit will be paid according to the provisions of your
policy.
Any benefits paid under this agreement will reduce the death benefit payable
to the beneficiary of the policy.
Any eligible benefits due and payable prior to the insured's death will be
paid if we receive proof of loss within the 15 day period following notice of
death.
IS THERE A MINIMUM DEATH BENEFIT PAYABLE?
Yes. The minimum death benefit amount is shown on the policy data pages. If
the policy death benefit (without regard to policy loan) is less than this
minimum death benefit amount, then the minimum death benefit amount less any
policy loan and unpaid policy loan interest is payable at the death of the
insured.
ARE POLICY CHANGES AND TRANSACTIONS ALLOWED WHILE BENEFITS ARE BEING PAID?
You may choose to decrease the face amount of the policy while benefits are
being paid. You may also request a partial surrender for the purpose of
applying it towards any policy loan on this policy.
The following policy changes and transactions are not allowed while benefits
are being paid.
(1) Changes in risk class; or
(2) Increases in the policy face amount; or
(3) Additions of agreements to your policy; or
(4) Transfers to sub-accounts or indexed accounts, or to a loan account,
if applicable; or
(5) Requests for loans; or
(6) Partial surrenders other than those described previously; or
(7) Changes in death benefit option; or
(8) Changes in account allocations.
EFFECT OF BENEFIT PAYMENTS
DOES THE PAYMENT OF BENEFITS AFFECT THE POLICY DEATH BENEFIT?
Yes. When a benefit payment is made, the death benefit is reduced by the
amount of the benefit payment.
DOES THE PAYMENT OF BENEFITS AFFECT THE POLICY ACCUMULATION VALUE?
Yes. The accumulation value of the policy is set equal to the accumulation
value immediately prior to the benefit payment multiplied by the new death
benefit (without regard to policy loan), divided by the death benefit
(without regard to policy loan) immediately prior to the benefit payment.
If your policy has a minimum accumulation value, the minimum accumulation
value will be adjusted in the same manner as the policy accumulation value.
DOES THE PAYMENT OF BENEFITS AFFECT THE DEATH BENEFIT GUARANTEE AGREEMENT
VALUE?
Yes. If your policy has the Death Benefit Guarantee Agreement attached, the
DBGA Value will be adjusted in the same manner as the policy accumulation
value.
DOES THE PAYMENT OF BENEFITS AFFECT THE POLICY LOAN?
Yes. If the policy has an outstanding loan, a portion of the benefit payment
will be applied to repay the loan. The amount of the benefit payment applied
to the policy loan is equal to the lesser of the benefit payment and the
result of:
(a) the loan interest due at the time of the benefit payment; plus
(b) the policy loan immediately prior to the benefit payment; multiplied
by one (1) minus the ratio of the new death benefit (without regard to
policy loan) divided by the death benefit (without regard to policy
loan) immediately prior to the benefit payment.
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WHAT HAPPENS TO THE ACCUMULATION VALUE IN THE SUB-ACCOUNTS OF THE SEPARATE
ACCOUNT OF THE POLICY WHEN BENEFIT PAYMENTS BEGIN?
If you have accumulation value in sub-accounts of a separate account when
benefit payments begin, we will automatically transfer any value in each
sub-account to the guaranteed interest account.
Once benefits are being paid, no further premium allocations may be made to
sub-accounts of a separate account.
WHAT HAPPENS TO THE ACCUMULATION VALUE OF THE POLICY IN AN INDEXED ACCOUNT
SEGMENT WHEN BENEFIT PAYMENTS BEGIN?
If you have accumulation value in indexed accounts when benefit payments
begin, we will automatically transfer any value in each segment of the
indexed accounts to the fixed account at each segment's next anniversary.
Once benefits are being paid, no further account allocations may be made to
the indexed accounts.
WHAT HAPPENS TO THE POLICY LOAN WHEN BENEFIT PAYMENTS BEGIN?
If you have a policy loan with a variable interest rate, we will
automatically change the loan to a fixed interest rate loan. We will also
automatically transfer accumulation value to the fixed loan account in the
amount of the policy loan plus any unpaid policy loan interest.
WILL THE CHARGES FOR THIS AGREEMENT BE WAIVED IF BENEFITS ARE BEING PAID?
Yes. As long as benefits are being paid, the charge for this agreement will
be waived. All other charges will continue to be assessed against your
policy.
WILL OTHER POLICY CHARGES BE WAIVED IF BENEFITS ARE BEING PAID?
No. However, if the policy accumulation value goes to zero while benefits
are being paid, we will waive all policy and agreement charges that would
otherwise be assessed against the policy accumulation value.
WHEN WILL THE PAYMENT OF BENEFITS TERMINATE?
The monthly benefit payments will stop when:
(1) 100% of the LTC amount has been paid; or
(2) the insured is no longer eligible for the benefit; or
(3) the policy is surrendered; or
(4) the policy terminates when the policy loan plus unpaid policy loan
interest exceeds the policy accumulation value; or
(5) we receive your request to cancel this agreement; or
(6) the insured dies.
WILL WE PAY BENEFITS UNDER AN ALTERNATIVE PLAN OF CARE?
If the insured is chronically ill and satisfies the claim procedures
provision, we will consider paying benefits under an alternative plan of care
for qualified long-term care services not specifically shown as being
available under this agreement. We reserve the right to make the final
decision on any request for an alternative plan of care.
We must agree that the alternative plan of care must be (1) medically
acceptable; and (2) the most cost effective manner in which to provide
benefits for the insured's claim under this agreement.
ADDITIONAL INFORMATION
WHAT IF THE INSURED'S AGE IS MISSTATED?
If the insured's age has been misstated on the application, we may at any
time adjust your benefits and/or charges based on the insured's correct age.
If no benefits would have been provided based on the insured's correct age,
our liability is limited to a refund of any charges taken for this agreement
and this agreement is null and void as of its effective date. Any benefits
paid to you must be repaid according to the provisions of this agreement.
IS THIS AGREEMENT SUBJECT TO THE INCONTESTABILITY PROVISION OF THE POLICY?
Yes. That provision applies to this agreement. The contestable period for
this agreement will be measured from the effective date of this agreement.
If this agreement is issued at a date later than this policy, then this
agreement will be contestable based only on the evidence of insurability
which we required to issue this agreement.
However, a misstatement by you or the insured in any application for the
policy or this agreement may be used to rescind (void) or cancel this
agreement or deny an otherwise valid claim. During the first six (6) months
following the policy date, we may take such action only if the misstatement
was material to the issuance of this agreement. After the first six (6)
months, but before the end of the first twenty-four (24) months, we may take
such action only if the misstatement was material to both the issuance of
this agreement and the claim for which benefits are being sought. After this
agreement has been in force for twenty-four (24) months from the effective
date of this agreement, we can take such action only if we can show you or
the insured knowingly and intentionally misrepresented relevant facts
relating to the insured's health. No benefits will be paid under this
agreement if it is rescinded or canceled.
In the event of death of the insured, this provision will not apply to the
remaining death benefit payable under the policy which will be governed by
the incontestability provision in the policy.
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DOES THIS AGREEMENT CONFORM TO STATE STATUTES?
Yes. If any part of this agreement that, on the effective date, conflicts
with the laws of the state in which the insured receives services is hereby
amended to meet the minimum requirements of those laws.
WHEN DOES THIS AGREEMENT TERMINATE?
This agreement will terminate on the earliest of:
(1) the date this policy is surrendered or terminated; or
(2) the date we receive your request to cancel this agreement; or
(3) the date of the insured's death.
CAN YOU REQUEST THAT THIS AGREEMENT BE REINSTATED?
Yes. You can request that this agreement be reinstated if all of the
reinstatement conditions stated in the policy have been satisfied. The
effective date of the agreement will be the same as the effective date of the
reinstated policy.
Alternatively, we will reinstate the policy and this agreement, but no other
agreements, if all of the following conditions are met:
(1) we receive written request for reinstatement from you, or your
designated third party; and
(2) the written request is received within 5 months after the
termination date; and
(3) we receive proof that you were cognitively impaired or a loss of
functional capacity existed prior to the expiration of the grace
period; and
(4) we receive all back charges due plus premium sufficient to keep the
policy in force another 3 months.
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Secretary President]
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