SKANDIA LIFETIME PLAN

Transcription

1 SKANDIA LIFETIME PLAN TERMS (reference SLP8)

2 1. Definitions Amount Allocated Means the amount applied in allocating Units to the Policy upon payment of a Premium as indicated in Appendix II. Commencement Date Means the Commencement Date shown in the Policy Schedule. RPI Means the Index of Retail Prices published monthly by the relevant Government department or such other similar index as Old Mutual Wealth may select. Life Assured Means the Life Assured shown in the Policy Schedule and, where two Lives Assured are shown in the Policy Schedule, the Life Assured shall mean either of the Lives Assured unless the context otherwise requires. Making of Assurance Date Means the date on which the Policy came into force. Review Date Means each anniversary of the Commencement Date of the Policy or such other date as Old Mutual Wealth may agree from time to time. Claim Date Means, in the context of a claim under the Policy by reason of death, the date written notification of death is received at Old Mutual Wealth s Head Office and, in the context of a claim under the Policy by reason of critical illness or Total Permanent Disability, the date the claim is admitted by Old Mutual Wealth. Policyholder Means the person or persons shown in the Policy Schedule as Policyholder or any subsequent legal owner of the Policy. The reference Lifetime Cover is used to denote a Policy which provides critical illness cover (with or without Total Permanent Disability Benefit) and under which, if no prior claim has been admitted, the amount payable on death is limited to 101% of the Bid Value of Units. The reference Lifetime Cover Plus is used to denote a Policy which provides critical illness cover (with or without Total Permanent Disability Benefit) and under which, if no prior claim has been admitted, the Sum Assured is payable on death. The singular shall include the plural and the masculine shall include the feminine except where the context otherwise provides. Valuation, Fund, Units, Bid Price and Offer Price are defined in Appendix I. Deferred Period Means the period of disability before any benefit is paid. Permanent Means expected to last throughout life, irrespective of when the cover ends or the insured person retires. Irreversible Means cannot be cured by medical treatment and/or surgical procedures used by the National Health Service in the UK at the time of the claim. 2 of 20

3 Premiums and Investment 2. PAYMENT OF PREMIUMS 2.1 Premiums are payable as shown in the Policy Schedule until the Policy terminates. 2.2 If a Premium due under the Policy remains unpaid 30 days after the Due Date of the Premium the provisions in Term 15 shall then apply. 3. ALLOCATION OF PREMIUMS 3.1 At Commencement or at any time thereafter the Policyholder may elect that Premiums paid from that date until a further such election is made shall be allocated to Units of one or more of the Funds in the proportions notified in the election provided that the election satisfies Old Mutual Wealth s requirements at that time. 3.2 In the absence of a Fund election which satisfies Old Mutual Wealth s requirements, the Old Mutual Deposit Fund shall be deemed to be the elected Fund. 3.3 Units shall be allocated: 4. UNIT ALLOCATION On the Due Date where the Premium is banked by Old Mutual Wealth before, on or within seven days after such Due Date; or, Where the Premium is banked by Old Mutual Wealth more than seven days after the Due Date, on the date of banking or such other date as Old Mutual Wealth shall determine. 4.1 The number of Units allocated in each Fund elected under Term 3 shall be determined by dividing the Amount Allocated from each Premium to each Fund by the Offer Price of Units in that Fund at the appropriate Valuation Date. 5. CONVERSION OF ALLOCATED UNITS 5.1 Subject to the following conditions at 5.2 below the Policyholder may request that allocated Units of one or more Funds be cancelled for conversion into Units of one or more other Funds at the Bid Prices on the Valuation Date appropriate to the cancellation and conversion. 5.2 The conditions are as follows: 6. UNIT DEDUCTIONS A conversion fee of such amount as Old Mutual Wealth shall specify from time to time shall be deducted from the value of the Units which are being cancelled, The appropriate Valuation Date will normally be the working day after Old Mutual Wealth receives a request for cancellation and conversion of Units in a manner satisfying Old Mutual Wealth s requirements. 6.1 Each month, Old Mutual Wealth shall reduce the number of Units. The reduction shall be determined by the Actuary to Old Mutual Wealth and will reflect the charges of Old Mutual Wealth for setting up the policy, establishing any Premium increment under the Policy and maintaining the level of cover provided by the Policy. 6.2 In determining the reduction to be made, Old Mutual Wealth shall have regard to: The amount of the Premium and Sum Assured, the frequency of payment, the age(s) of the Life/Lives Assured and the table SLP6 applicable at Commencement Date or at any Premium increment date which is maintained by Old Mutual Wealth for this purpose, The excess of the Sum Assured over the value of Units at the Bid Price multiplied by the rate of mortality/morbidity applicable to the then ages of the Life/Lives Assured according to such published tables adjusted as the Actuary to Old Mutual Wealth may at that time deem appropriate. No mortality charge shall be made in respect of any period that the type of Cover is Lifetime Cover. 6.3 In addition to the charges indicated at (6.1) Old Mutual Wealth reserves the right to levy a monthly maintenance charge for the cost of administering the Policy but this charge will be waived for the period prior to the first Review Date and thereafter provided the Inflation Option (in Term 10.1 or 10.1) is fully exercised at each Review Date. 7. LUMP SUM 7.1 Lifetime Cover Plus (d) (e) The provisions of this Term 7.1 apply (and the provisions in Term 7.2 do not apply) where the Policy Schedule, or an endorsement to the Policy, shows the type of cover as Lifetime Cover Plus. On Old Mutual Wealth receiving written notification at its Head Office of the death of the Life Assured or the admittance by Old Mutual Wealth of a critical illness claim Old Mutual Wealth will pay the Lump Sum which shall be the higher of the following: (i) The Sum Assured under the Policy on the date of the event giving rise to the claim; (ii) The Bid Value of the Units allocated to the Policy, normally determined on the Valuation Date following the Claim Date. The amount of the Lump Sum shall be increased by an amount which reflects the percentage increase in the Bid Price of Accumulator Units of the Old Mutual Deposit Fund from the Valuation Date following the Claim Date to the date the claim payment is calculated, less such sum as Old Mutual Wealth may be required to deduct in accordance with Section 349 Income and Corporation Taxes Act 1988 (or any reenactment thereof). If the Policy Schedule, or an endorsement to the Policy, shows that Total Permanent Disability Benefit applies the Lump Sum shall be payable on acceptance by Old Mutual Wealth that the Life Assured is totally and permanently disabled as set out in Term 17. The Lump Sum is only payable once. The Policy will terminate on payment of the Lump Sum and no other benefits shall be payable. 3 of 20

4 (f) Once a claim in respect of a Critical Illness has been admitted, we will refund any premiums paid between the date of admittance and the date of payment of the claim. Once a death claim has been admitted, we will refund any premiums paid between the date of death and payment of the claim. 7.2 Lifetime Cover The provisions of this Term 7.2 apply (and the provisions in Term 7.1 do not apply) where the Policy Schedule, or an endorsement to the Policy, shows the type of cover as Lifetime Cover. On admittance by Old Mutual Wealth of a critical illness claim which will be subject to the appropriate Deferred Period as set out in Term 21.2 Old Mutual Wealth will pay the Lump Sum which shall be the higher of the following: (i) The Sum Assured under the Policy on the date of the event giving rise to the claim; (ii) The Bid Value of the Units allocated to the Policy, normally determined on the Valuation Date following the Claim Date. (d) (e) (f) (g) The amount of the Lump Sum or any benefit payable in (f) below shall be increased by an amount which reflects the percentage increase in the Bid Price of Accumulator Units of the Old Mutual Deposit Fund from the Valuation Date following the Claim Date to the date the claim payment is calculated, less such sum as Old Mutual Wealth may be required to deduct in accordance with Section 349 Income and Corporation Taxes Act 1988 (or any re-enactment thereof). If the Policy Schedule, or an endorsement to the Policy, shows that Total Permanent Disability Benefit applies the Lump Sum shall be payable on acceptance by Old Mutual Wealth that the Life Assured is totally and permanently disabled as set out in Term 17. The Lump Sum is only payable once. The Policy will terminate on payment of the Lump Sum and no other benefits shall be payable. If the Life Assured dies before admittance of a claim in respect of critical illness or total permanent disability, the Policy will terminate on death and the amount then payable will be 101% of the Bid Value of Units allocated to the Policy which will normally be determined on the Valuation Date following the Claim Date. Once a claim in respect of a Critical Illness has been admitted, we will refund any premiums paid between the date of admittance and the date of payment of the claim. Once a death claim has been admitted, we will refund any premiums paid between the date of death and payment of the claim. 7.3 The Policyholder may apply at any time for the type of cover to be amended from Lifetime Cover to Lifetime Cover Plus or vice versa. Any such variation will be subject to Old Mutual Wealth s normal requirements at that time, including underwriting requirements and such increased Premium as Old Mutual Wealth may specify. 7.4 The Lump Sum payable under this Term 7 is not affected by any claim or claims paid under Term CHILDREN S BENEFIT 8.1 This Benefit applies automatically to a Policy where the Life Assured has a Relevant Child and is included at no cost. 8.2 For the purpose of this Term 8 a Relevant Child includes all natural children, all legally adopted children and all step-children from a legally recognised marriage of the Life Assured who have attained the age of 30 days. Any such child shall cease to be a Relevant Child on attaining the age of 18 years. 8.3 The Benefit is payable on the Relevant Child being diagnosed as suffering from a critical illness and the claim being admitted by Old Mutual Wealth, provided that such a critical illness has not resulted directly or indirectly from a pre-existing medical condition which existed prior to the later of: (i) (ii) The Relevant Child s attainment of the age of 30 days or, if the Relevant Child has been legally adopted, the date of adoption or, in the case of step-children, the date of marriage of the Life Assured to the natural parent; The Making of Assurance Date of the Policy. 8.4 The amount payable shall be the lower of: (i) 50% of the Sum Assured in force at the time of a claim, including any Sum Assured Addition payable and (ii) 20, Where more than one policy on the life of the Life Assured providing Children s Benefit is in force with Old Mutual Wealth at the time a claim is admitted Term 8.4 shall be applied as if all such policies were one policy and the total amount of the benefit payable shall be apportioned amongst all the policies offering the benefit by reference to the Sums Assured provided by those policies. 8.6 On the payment of the benefit under this Term 8 the child in respect of which the payment has been made shall cease to be a Relevant Child and no future payments shall be made in respect of that child. 8.7 For the purposes of this Term 8 the Critical Illnesses shall have the meanings attributed to them in Appendix VI (but with references to Life Assured substituted by Relevant Child ). 8.8 The Critical Illnesses, other than bacterial meningitis, are subject to a Deferred Period as described in Term No payment shall be made under this Term 8 if a Relevant Child dies during the Deferred Period. There is no Deferred Period in respect of bacterial meningitis where the claim is made under Children s Benefit. 8.9 Where the reference SP2a Total Permanent Disability Benefit is shown in the Policy Schedule or an endorsement to the Policy no Total Permanent Disability Benefit shall apply to a Relevant Child. 4 of 20

5 9. SUM ASSURED ADDITION FAMILY RELEVANT EVENTS 9.1 Where a Relevant Event in a Family Relevant Event category shown in Column 1 of Appendix III has occurred since the Review Date preceding the date the Sum Assured becomes payable in accordance with Term 7, then Old Mutual Wealth shall pay a Sum Assured Addition which shall be the appropriate amount shown in Column 2 of Appendix III subject to the conditions that follow. 9.2 The amount of the Sum Assured Addition for a Relevant Event shall be restricted where the Sum Assured has been increased previously by exercise of an option under Term 10.2 for an event or events of the same type, in which case the maximum Sum Assured Addition shall be the amount shown in Column 3 of Appendix III less the Sum Assured increase(s) which Old Mutual Wealth has previously provided under Term 10.2 for an event or events of the same type. 9.3 The amount of the Sum Assured Addition for a Relevant Event shall be restricted if there are Sum Assured Additions for the same event under other policies in force with Old Mutual Wealth. In this event the total of the Sum Assured Additions shall not exceed the amount which would be payable if only this Policy was in force. The Sum Assured Additions so determined shall be apportioned over all relevant policies proportionately by reference to the Sums Assured provided by such policies. 9.4 There shall be no Sum Assured Addition if: The Policy is accepted other than on Old Mutual Wealth s standard terms; OR Any due Premium under the Policy is unpaid as at the date the Sum Assured becomes payable; OR The Sum Assured becomes payable after the last Review Date preceding the 55th birthday of the Life Assured. 9.5 Any Relevant Event shown in Appendices IV and V shall not result in any Sum Assured Addition under this Term INCREASE OF SUM ASSURED 10.1 Inflation Options Automatic Inflation Option This Automatic Inflation Option only applies if the reference SP16 Automatic Inflation Option is shown as a special provision in the Policy Schedule. Subject to the following conditions the Sum Assured will be increased automatically at every Review Date by the amount calculated in accordance with (i) below without any evidence of health having to be supplied. (i) The Sum Assured will be increased automatically at each Review Date by the greater of 10% and the percentage increase in the RPI since the previous Review Date or (if there has been no previous Review Date) since Commencement Date. (ii) The Premium will be increased to the level that Old Mutual Wealth considers necessary to support the increased level of Sum Assured. Where this results in the Premium increasing by more than 10%, we reserve the right to increase the Sum Assured automatically by a lesser amount than that indicated in Term 10.1(i), although the Policyholder may elect to override this restriction if required and have a full increase in the Sum Assured based on Term 10.1(i). This restriction will not limit the amount of the Premium payable under Term 10.1(iii). If this restriction is applied, the Policyholder will be deemed to have adopted this Term 10.1 in full and this Automatic Inflation Option will continue to apply. (iii) The Policyholder may as an alternative elect to pay the Premium which would have been due under this Term 10.1(ii) above but without increasing the Sum Assured by the amount specified in this Term 10.1(i) above. In making such an election the Policyholder will be deemed to have adopted this Term 10.1 in full and this Automatic Inflation Option will continue to apply. (iv) If an increase available under this Term 10.1 is not adopted in full by the Policyholder this Automatic Inflation Option shall cease to apply and cannot be reinstated. (v) While this Option is available no Inflation Increase can be made under Term (vi) This Automatic Inflation Option will cease to apply immediately upon receipt of any notification from the Life Assured, Policyholder or their Agent by Old Mutual Wealth at its Head Office of a claim for any benefits under Term 7. Under no circumstances will the Option be reinstated. Annual Inflation Option Subject to the following conditions the Policyholder may increase the Sum Assured at each Review Date by the amount calculated in accordance with (i) below without any evidence of health having to be supplied. (i) The Sum Assured may be increased at each Review Date by the greater of 10% and the percentage increase in the RPI since the previous Review Date or (if there has been no previous Review Date) since Commencement Date. (ii) The Premium will be increased to the level that Old Mutual Wealth considers necessary to support the increased level of Sum Assured. (iii) The Policyholder may as an alternative elect to pay the premium which would have been due under this Term 10.1(ii) above but without increasing the Sum Assured by the amount specified in this Term 10.1(i) above. In making such an election the Policyholder will be deemed to have accepted this Annual Inflation Option in full and this said Option will continue to apply. (iv) If no increase offered pursuant to this Term 10.1 is accepted in full by the Policyholder during any consecutive 10 year period this Annual Inflation Option shall cease to apply and cannot be reinstated. (v) This Annual Inflation Option will cease to apply immediately upon receipt of any notification from the Life Assured, Policyholder or their Agent by Old Mutual Wealth at its Head Office of a claim for any benefits under Term 7. In the event of the claim being declined by Old Mutual Wealth the Annual Inflation Option will be reinstated provided the Policyholder had accepted the Automatic Inflation Option or exercised the Annual Inflation Option in each previous year. We will then allow the Policyholder to take up any Inflation Option increases which would have been offered during the period when the claim was being considered. If any claim, which is declined, arises during the first year of the Policy, we will assume that the Policyholder would have taken up an Inflation Option increase and will reinstate the Annual Inflation Option. We will then allow the Policyholder to take up any increases which would have been offered during the period when the claim was being considered. 5 of 20

6 10.2 Relevant Event Increases Family Events Where a Relevant Event in the Family Relevant Event category as shown in Column 1 of Appendix III has occurred since the previous Review Date, Old Mutual Wealth will allow an increase in the Sum Assured effective from the next Review Date subject to the General Provisions at 10.6 below and the following provisions: A Family Event increase shall not be available after the 55th birthday of the Life Assured, Such evidence as Old Mutual Wealth may require shall be furnished to establish that a Family Event has occurred, The Premium shall be increased from the effective Review Date to such amount as Old Mutual Wealth shall specify Relevant Event Increases Business Events Where a Relevant Event in the Business Relevant Event category as shown in Column 1 of Appendix IV has arisen since the previous Review Date, Old Mutual Wealth will allow an increase in the Sum Assured effective from the next Review Date subject to the General Provisions at 10.6 below and the following provisions: (d) (e) A Business Event increase shall only be available if it is applied for before the 60th birthday of the Life Assured, A Business Event increase shall not be available if there is more than one Life Assured under the Policy, Such evidence as Old Mutual Wealth may require shall be furnished to establish that a Business Event has occurred and to support the amount of the proposed increase, The Premium shall be increased from the effective Review Date to such amount as Old Mutual Wealth shall specify, Old Mutual Wealth will require evidence that the purpose of the Policy is to provide the Life Assured s co-partners or co-shareholders with monies to purchase the Life Assured s interest in the business. Old Mutual Wealth will also require evidence of the increase of the Life Assured s interest from a chartered or certified accountant Inheritance Tax (IHT) Relevant Events Estate Value Increase Where a Relevant Event in the Estate Value Increase category shown in Column 1 of Appendix V has arisen since the previous Review Date, Old Mutual Wealth will allow an increase in the Sum Assured from the next Review Date subject to the General Provisions at 10.6 below and the following provisions: At the time the application to increase the Sum Assured is made and accepted under this Term10.4 the type of cover under the Policy must be Lifetime Cover Plus, Such evidence as Old Mutual Wealth may require shall be furnished to establish that an Estate Value Increase has occurred and to support the amount of the proposed increase, (d) The Premium shall be increased to such amount as Old Mutual Wealth shall specify, Old Mutual Wealth may require evidence that one of the purposes of the Policy is to provide proceeds to pay IHT arising in the event of death Inheritance Tax (IHT) Relevant Events - Legislation Increase Where a Relevant Event in the Legislation increase category shown in Column 1 of Appendix V has arisen, Old Mutual Wealth will allow an immediate increase in the Sum Assured subject to the General Provisions at 10.6 below and the following provisions: (d) (e) (f) (g) At the time the application to increase the Sum Assured is made and accepted under this Term10.5 the type of cover under the Policy must be Lifetime Cover Plus, A Legislation Increase to the Sum Assured shall only be available if a request for the increase is received at Old Mutual Wealth s Head Office within six months of the effective date of the change following the relevant Government Statement announcing the change in the rates and/or rate bands for IHT and/or the IHT reliefs and/or exemptions, Old Mutual Wealth shall require evidence of the amount of the IHT liability which would have been payable in the event of the death of the Life Assured immediately prior to the effective date of the change, Old Mutual Wealth will calculate the proportion of the IHT liability being covered by the Sum Assured immediately prior to the effective date of the change and the increase in the prospective IHT liability; the related increase to the existing Sum Assured will be limited in two respects: (i) The proportion of the IHT liability being covered by the Sum Assured may not increase as a result of the exercise of this Option, (ii) The proportion of the IHT liability being covered by the Sum Assured cannot exceed 100% as a result of the exercise of this Option, Old Mutual Wealth may amend or cancel the increase under this Term 10.5 if the proposed increase does not come into full force and effect by way of statutory enactment, The Premium shall be increased to such amount as Old Mutual Wealth shall specify, Old Mutual Wealth may require evidence that one of the purposes of the Policy is to provide proceeds to pay IHT arising in the event of death Relevant Event Increases General Provisions The following additional provisions shall apply to Relevant Event increases to the Sum Assured: The increase in the Sum Assured for a Relevant Event shall not exceed the appropriate amount shown in Column 2 of the Appendix for the Relevant Event concerned, The total Sums Assured that Old Mutual Wealth is providing and has provided under the Policy and under any other policies on the Life Assured as a result of the Relevant Event and all previous similar Relevant Events shall not exceed the amount of the Maximum Insurability Option shown in Column 3 of the appropriate Appendix for the Relevant Event concerned or such higher limit as Old Mutual Wealth may publish for such a Relevant Event, 6 of 20

7 (d) 10.7 Other increases Where other policies are in force with Old Mutual Wealth on the Life Assured in addition to this Policy and where those other policies also provide options enabling the Sum Assured to be increased in the circumstances shown in Column 1 of the appropriate Appendix for the Relevant Event concerned the total amount by which the Sum Assured can be increased by reason of the Relevant Event concerned shall not exceed the amount which would be available if only one policy was in force with such an option; the total increase in the Sum Assured so determined will normally be apportioned over all policies proportionately by reference to the Sums Assured provided by such policies, An increase under these Relevant Event provisions shall not be available if the Policy was accepted other than on Old Mutual Wealth s standard terms. On application by the Policyholder the Sum Assured may be increased subject to such conditions as Old Mutual Wealth may then prescribe. 11. REDUCTION OF SUM ASSURED On application by the Policyholder the Sum Assured may be reduced subject to such conditions as Old Mutual Wealth may prescribe. 12. INCREASE OF PREMIUM On application by the Policyholder the Premium may be increased to any amount acceptable to Old Mutual Wealth. 13. REDUCTION OF PREMIUM On application by the Policyholder Old Mutual Wealth will allow the Premium to be reduced subject to the following conditions: 13.1 The reduced Premium must not be less than Old Mutual Wealth s minimum premium for the type of cover provided by the Policy at that time, 13.2 Old Mutual Wealth may reduce the Sum Assured to a level Old Mutual Wealth considers appropriate having regard to the reduced level of Premium, 13.3 The unit deduction made in respect of setting up and maintaining the Policy and establishing any Premium increment shall not be reduced as a result of the Premium being reduced. 14. SURRENDER The Policy may be surrendered in whole for a surrender value determined by Old Mutual Wealth by reference to the Bid Value of the Units allocated to the Policy, normally determined at the Valuation Date on the working day following receipt at Old Mutual Wealth s Head Office of a written surrender request in the manner prescribed by Old Mutual Wealth for surrender. The Policy will terminate on surrender and cannot be reinstated thereafter. The Policy cannot be partially surrendered. 15. PREMIUM DISCONTINUANCE 15.1 Thirty days of grace are allowed for the payment of Premiums If a Premium is unpaid at the end of the days of grace the Policy shall be made paid-up provided that it has a surrender value and monthly charges will continue to be deducted by cancellation of allocated Units in accordance with Term 6 until there are insufficient Units to meet the cost of maintaining the Policy in force at which moment the Policy will lapse without value If a Premium is unpaid at the end of the days of grace and the Policy has no surrender value the Policy will immediately lapse without value If a Premium is unpaid at the end of the days of grace Waiver of Premium cover will thereupon cease Where the Policy has been made paid-up or lapsed without value it may be reinstated at any time within 13 months of the Due Date of the first unpaid Premium on production to Old Mutual Wealth at its Head Office of such medical or other evidence as Old Mutual Wealth may require and upon payment of all outstanding Premiums. Old Mutual Wealth reserves the right to decline a request to reinstate or impose such conditions as it considers appropriate. 16. WAIVER OF PREMIUM BENEFIT 16.1 Availability 16.2 Benefit The reference SP1 Waiver of Premium Benefit is used to denote that the Policy provides Waiver of Premium Benefit and this Benefit is only payable if this reference is shown as a special provision in the Policy Schedule or an endorsement to the Policy. Subject to the provisions of Term 20, if the Life Assured shall be disabled (as defined below) for a continuous period exceeding six consecutive months Old Mutual Wealth will, on proof satisfactory to Old Mutual Wealth of such disability and on proof of age, waive the subsequent payment of Premiums and, in certain circumstances, increased Premiums as described in accordance with 16.4 below Disability Disability in the context of Waiver of Premium cover means total incapacity by reason of accident or illness which, in the opinion of Old Mutual Wealth, prevents the disabled individual from following his own occupation (as disclosed in the original Policy application or in any subsequent written notification to Old Mutual Wealth) and the disabled individual is not following any gainful occupation. Disabled shall have a corresponding meaning Premiums Waived No Premium shall be waived which falls due before the expiry of six months from the later of the date of the event giving rise to a claim and the Life Assured ceasing to follow his usual gainful occupation ( The Deferred Period ) nor shall any premium be waived which falls due after the 60th birthday of the Life Assured. On admittance of a claim, all subsequent premiums falling due shall be waived until the happening of the earliest of the following events: (i) The 60th birthday of the Life Assured; (ii) The recovery of the Life Assured from being disabled (iii) The surrender of the Policy under Term 14; 7 of 20

8 (iv) Payment of the Lump Sum under Term 7; (v) Payment of the Benefit under Term 7.2(f). Where the Sum Assured has been increased under the Inflation Option provisions in Term 10, at every Review Date preceding disability (or where the event giving rise to the claim occurs before the first Review Date) Old Mutual Wealth will continue to increase the Sum Assured, whilst Waiver of Premium Benefit is payable, in accordance with Term Where in the opinion of Old Mutual Wealth the Premium level being waived is insufficient to maintain the Sum Assured Old Mutual Wealth reserves the right to reduce the Sum Assured to a level Old Mutual Wealth considers appropriate No benefit shall be available under this Term 16 if there are any arrears of Premium at the time disability occurs or at any time thereafter until the end of the six month period referred to in this Term 16.2 above No benefit shall be available under this Term 16 as a result of disability which in the opinion of Old Mutual Wealth resulted directly or indirectly from or was accelerated by pregnancy, childbirth or termination of pregnancy unless the disability continues for longer than six months after the end of the pregnancy Term 21.1 shall not apply to any claim under Term Cost of Cover The figure for the appropriate Allocation Percentage shown in Appendix II will be reduced by 2 to provide for this Benefit (or by 4 where 2 persons are shown as Lives Assured). The reduction in respect of a Life Assured shall not apply from the Review Date immediately after the Waiver of Premium cover has ceased to be available in respect of that Life Assured. 17. TOTAL PERMANENT DISABILITY BENEFIT 17.1 Availability 17.2 Benefit The reference SP2a Total Permanent Disability Benefit is used to denote that the Policy provides Total Permanent Disability Benefit and this Benefit is only payable if this reference is shown as a special provision in the Policy Schedule or an endorsement to the Policy. Subject to the provisions of Term 20, if the Life Assured shall be totally and permanently disabled (as defined below) prior to his 60th birthday Old Mutual Wealth will, on proof satisfactory to Old Mutual Wealth of such total and permanent disability and on proof of age, pay the Lump Sum under Term 7. On payment being made under this Term 17.2 the Policy shall terminate and no other benefits shall be payable Addition of Total Permanent Disability Benefit If Total Permanent Disability Benefit is not shown in the Policy Schedule or any endorsement to the Policy, the Policyholder may apply at any time for such Benefit to be added to the Policy. Any such application will be subject to Old Mutual Wealth s normal underwriting requirements and such increased Premium as Old Mutual Wealth may require Removal of Total Permanent Disability Benefit If Total Permanent Disability Benefit is shown in the Policy Schedule or any endorsement to the Policy, the Policyholder may apply at any time for it to be deleted. Any such application will be subject to Old Mutual Wealth s requirements. Old Mutual Wealth reserves the right to amend the Policy so as to remove Total Permanent Disability Benefit in the event of a change of occupation or pastimes Total Permanent Disability Total Permanent Disability shall mean total, permanent and irreversible disability by reason of accident or illness to the extent that the Life Assured is unable to and will never again be able to perform his or her own occupation as disclosed in the application form (or any subsequent written notification to Old Mutual Wealth). Totally and permanently disabled shall have a corresponding meaning. This benefit applies in respect of the Life Assured s main occupation only, as disclosed on the application form (or any subsequent written notification to Old Mutual Wealth). If the Life Assured is not in full-time (more than 16 hours a week) remunerative employment at the time of the event giving rise to the claim (eg a houseperson, student, retired, unemployed for a continuous period of six months or more, etc) then Total Permanent Disability would be assessed by the inability of the Life Assured to perform four or more of the Working Age Activities described below without the assistance of another person, even with the use of special devices or equipment. This must be supported by medical evidence from a relevant specialist. Working Age Activities Transference and Mobility Dressing Eating Finance Healthcare Communication 18. CHANGE OF LIFE ASSURED Walking 100 metres and getting into and out of a car Putting on and taking off all items of clothing which are normally worn Using everyday cutlery to eat food once prepared Recognising money and its value and making purchases/checking change, etc Independently arranging to see a doctor and taking routine prescribed medication Answering the telephone and taking a message for someone At any time the Policyholder may apply for the Life Assured to be changed to such individual or individuals as the Policyholder may select. Any application under this Term 18 will be subject to Old Mutual Wealth s normal underwriting, premium and insurable interest requirements. 8 of 20

9 19. continuing cover benefit Continuing Cover Benefit is automatically included on joint life cases. Following the termination of the policy due to a claim, a new Skandia Lifetime Plan can be taken out on the remaining Life Assured, if then aged under 60. The premium payable will be based on the then current age of the remaining Life Assured. There will be no need for further underwriting, subject to the following conditions: 19.1 The new Skandia Lifetime Plan must be effected between one and three months after the admittance of the claim on this policy, 19.2 The maximum Sum Assured on the new policy will be the lower of the Sum Assured under this policy at the time of the claim and 100,000, 19.3 any Waiver of Premium and/or Total Permanent Disability cover under this policy will continue on the new policy subject to the Life Assured s occupation still being acceptable to Old Mutual Wealth. Subject to that, the type of cover will be identical to that provided under this policy. 20. POLICY EXCLUSIONS 20.1 Exclusions applying to Waiver of Premium and Total Permanent Disability Benefit No benefit shall be available under Terms 16 and/or 17 in respect of any disability which, in the opinion of Old Mutual Wealth, resulted directly or indirectly from or was accelerated by: (i) Alcohol or solvent abuse, or the taking of drugs except under the direction of a registered medical practitioner; intentional self-inflicted injury; or taking part in a criminal act, or (ii) War, invasion, hostilities (whether war is declared or not), civil war, rebellion, revolution or taking part in a riot or civil commotion, or (iii) Taking part in (or practising for) horse racing, mountaineering, pot-holing, under-water diving or any race, trial or timed motor sport, or (iv) Taking part in any flying activity, other than as a passenger in a commercially licensed aircraft, or (v) Unreasonable failure to follow medical advice. No benefit will be payable under Terms 16 and/or 17 in respect of disability which is shown to be as a result of or related to infection by any Human Immunodeficiency Virus or conditions due to any Acquired Immune Deficiency Syndrome (AIDS) Exclusions applying to Waiver of Premium Benefit only Foreign Residence or Travel (d) If the Life Assured is outside any of the countries shown in Box 1 shown on page 12 for three or more months in any period of 12 consecutive months Old Mutual Wealth may vary Term 16 to an extent Old Mutual Wealth considers appropriate having regard to the circumstances and Old Mutual Wealth reserves the right to cancel cover under Term 16. If the Life Assured resides outside any country shown in Box 2 shown on page 12 for six or more months, any cover under Term 16 will cease. Any cover cancelled under or of this Term 20.2 can only be reinstated on such terms as Old Mutual Wealth may prescribe. Notification of Residence (i) Where the Life Assured envisages being outside any of the countries listed in Box 1 shown on page 12 for three or more months in any period of 12 consecutive months Old Mutual Wealth should be notified before that 12 month period starts or during the first three months of that 12 month period (ii) Where the Life Assured resides outside the countries listed in Box 2 shown on page 12 for six or more months Old Mutual Wealth should be notified before or during the first six months of such residence (iii) Failure to comply with any of the above notification requirements within the period specified may result in Waiver of Premium cover being cancelled or amended and any claim for Waiver of Premium Benefit being refused. Box 1 Australia, Austria, Belgium, Canada, Channel Islands, Denmark, Finland, France, Germany, Gibraltar, Isle of Man, Italy, Luxembourg, The Netherlands, New Zealand, Norway, Portugal, Republic of Ireland, Spain, Sweden, Switzerland, United Kingdom and United States of America. Box 2 Channel Islands, Isle of Man, Republic of Ireland, United Kingdom Exclusions applying to Total Permanent Disability Benefit only Change of Occupation Where the Life Assured changes his occupation Old Mutual Wealth reserves the right to immediately cancel Total Permanent Disability Benefit or otherwise amend the Policy if in its opinion the new occupation falls outside those occupations normally acceptable to Old Mutual Wealth for the provision of Total Permanent Disability Benefit. Hazardous Sports and Pastimes Where the Life Assured regularly takes part in (or practises for) any hazardous sport or pastime (including but not limited to horse racing, under-water diving, power boat racing, mountaineering, climbing, caving, pot-holing and any race, trial or timed motorsport) then Old Mutual Wealth reserves the right to immediately cancel Total Permanent Disability Benefit or otherwise amend the Policy if in its opinion 9 of 20

10 the pastime falls outside those pastimes normally acceptable to Old Mutual Wealth for the provision of Total Permanent Disability Benefit. This exclusion does not, however, extend to activities which are commonly undertaken whilst on ordinary (ie not special interest) holidays, eg on-piste skiing, jet skiing, parascending, hill walking. Notification of Occupation (i) Any change of occupation should be notified to Old Mutual Wealth before the change or within 30 days of the change. (ii) Where the Life Assured fails to comply with any of the above notification requirements Old Mutual Wealth reserves the right to immediately cancel Total Permanent Disability Benefit or otherwise amend the Policy Exclusions applying to Critical Illness Cover A critical illness will not be considered to have occurred for the purpose of this Policy and no Lump Sum will be payable under Term 7 if it arises directly or indirectly from, or was accelerated by: 21. GENERAL CLAIMS PROVISION 21.1 General Notice of Claim 21.2 Deferred Periods (i) Intentional self-inflicted injury, alcohol or solvent abuse, or the taking of drugs except under the direction of a registered medical practitioner; or taking part in a criminal act, or (ii) The Life Assured becoming infected by any Human Immunodeficiency Virus or conditions due to any Acquired Immune Deficiency Syndrome (AIDS) at any time after the Making of Assurance Date. This exclusion does not apply to HIV/AIDS acquired in the circumstances described in respect of Critical Illness numbered 12 of Appendix VI, or (iii) Unreasonable failure to seek or follow medical advice. Written notice of a claim should normally be given to Old Mutual Wealth at its Head Office within three months of the event giving rise to a claim. If written notice of a claim is not given to Old Mutual Wealth within three months of the event giving rise to the claim, the event shall be deemed to have occurred three months before the date Old Mutual Wealth receive written notification. If a claim is made in respect of a critical illness or Total Permanent Disability, any premiums paid between the date of admittance of a claim and the date of payment of the claim will be refunded. If a claim is made in respect of the death of a Life Assured, any premiums paid between the date of death and the payment of the claim will be refunded. At the time a critical illness or disability is diagnosed there may be a period before which a claim will be admitted. These Deferred Periods are as set out below: (d) (e) Lifetime Cover Plus The duration of each Deferred Period, where applicable, is set out in Appendix VI. If the Life Assured dies during the period referred to in Appendix VI the Lump Sum will immediately become payable. Lifetime Cover All the periods referred to in above and in Appendix VI apply where the type of cover is Lifetime Cover at the time a critical illness is diagnosed. There will also be a 14 day Deferred Period in respect of all critical illnesses except Multiple Sclerosis and Loss of Independent Existence if the type of cover is Lifetime Cover when a critical illness (as described in Appendix VI) is diagnosed, or surgery is undergone, as appropriate. The Deferred Period for Multiple Sclerosis is six months. For Loss of Independent Existence the Deferred Period is three months. There is no Deferred Period in respect of bacterial meningitis where the claim is made under Children s Benefit. The Deferred Period will start when the critical illness is diagnosed or surgery is undergone as appropriate. If the Life Assured is alive at the end of the Deferred Period the Lump Sum shall immediately become payable. If the Life Assured dies during the Deferred Period the benefit payable shall be limited to 101% of the Bid Value of Units normally determined on the Valuation Date following the Claim Date. Children s Benefit The critical illnesses applying to the Children s Benefit are as specified by Term 8.7 and the Deferred Periods applicable to these are as set out in Term Any Deferred Period will start when the critical illness is diagnosed or surgery is undergone, as appropriate. If the Relevant Child, as defined in Term 8, is alive at the end of the Deferred Period the Lump Sum shall immediately become payable. If the Relevant Child dies during the Deferred Period no Children s Benefit shall be payable. Waiver of Premium Benefit The Deferred Period is six months from the later of the date of the event giving rise to a claim and the Life Assured ceasing to follow his usual gainful occupation. Where the Life Assured recovers from being disabled (as defined in Term 16.3) but then becomes disabled again from the same cause within six months of the recovery, no further Deferred Period shall be applied and all premiums falling due from the recommencement of disability shall be waived until the happening of the earlier of the events specified in Term 16.4(i),(ii),(iii),(iv) and (v). Total Permanent Disability Benefit There is no Deferred Period. 10 of 20

11 General Provisions 22. ELECTIONS Elections to exercise options conferred by the Policy shall not be effective until receipt at Old Mutual Wealth s Head Office of such election in writing signed by the Policyholder together with the Policy, where required, by Old Mutual Wealth. 23. VARIATION 23.1 If at any time in the opinion of Old Mutual Wealth the allocation to cover management expenses for any Fund represented by the Annual Management Charge for such Fund is insufficient or in the event of any change in legislation relating to taxation or otherwise or in the event of any other change affecting the contract, Old Mutual Wealth may vary these Terms in such manner as Old Mutual Wealth considers necessary at its absolute discretion including the variation without limit of the said Annual Management Charge. Old Mutual Wealth will notify the Policyholder of the variation and the reason for it at the first practical opportunity Old Mutual Wealth may similarly vary these Terms in respect of any levy imposed under the Policyholders Protection Act Old Mutual Wealth will notify the Policyholder of the variation and the reason for it at the first practical opportunity Old Mutual Wealth may at its discretion defer a transaction involving cancellation or conversion of Units for up to two weeks (or, in the case of a Fund which has a direct or indirect real property element, a period not exceeding 12 months). Where circumstances outside the control of Old Mutual Wealth preclude the calculation of fair and accurate prices for Units involved in a transaction, the transaction may be deferred to a date Old Mutual Wealth considers appropriate and equitable having regard to the circumstances, the interests of the Policyholder and the interests of its policyholders generally. 24. TEN YEAR POLICY REVIEW 25. SUICIDE The Policy shall be reviewed on the 10th anniversary of Commencement and at such intervals thereafter as Old Mutual Wealth shall determine. If at any of these reviews Old Mutual Wealth considers that the value of Units allocated, or to be allocated to the Policy in respect of future Premiums, is insufficient to sustain the Sum Assured then in force until the next such review, Old Mutual Wealth may reduce the Sum Assured to such amount as Old Mutual Wealth shall consider appropriate having regard to the regular Premium at that time The provisions in Term 25.2 below shall only apply if the type of cover is Lifetime Cover Plus at the time of the suicide. They will not apply where a qualifying lender (as defined by section 376 Income and Corporation Taxes Act 1988) who is not a Life Assured or Policyholder has acquired a bona fide interest in the Policy and written notice of such interest has been received by Old Mutual Wealth at its Head Office before the date of death of the Life Assured. In this case, the amount payable will be the smaller of: (i) The death benefit that would otherwise have applied at the date of death, or (ii) The capital amount owed to the qualifying lender on that date The Sum Assured shall be limited to a refund of Premiums paid if the Life Assured commits suicide within one year of the latest of: The Making of Assurance Date The Policy changing from Lifetime Cover to Lifetime Cover Plus The Policy being reinstated if it had previously been made paid-up or had lapsed as described in Term If the Life Assured commits suicide within one year from the effective date of any increase in the Sum Assured, the Sum Assured payable will be restricted to the Sum Assured that would have been applicable prior to the increase in the Sum Assured together with a refund of the Premiums paid (if any) in respect of the increase in the Sum Assured. 26. ASSIGNMENT When acknowledging and noting in its records any assignment or notice of assignment Old Mutual Wealth accepts no responsibility for the validity or effect thereof. 27. JOINT OWNERSHIP BENEFIT PAYMENTS 27.1 The provisions in this Term 27 shall apply where: There are two Lives Assured under the Policy, and Legal and beneficial ownership of the Policy is vested in both Lives Assured as joint owners If proceeds arise under the Policy by reason of a Life Assured becoming disabled or critically ill, the Life Assured who is disabled or critically ill shall be entitled to the whole of the proceeds If proceeds arise under the Policy by reason of the death of a Life Assured, the surviving Life Assured shall be entitled to the whole of the proceeds The Lives Assured shall be jointly entitled to any surrender proceeds under the Policy. 28. DOCUMENTATION No benefit shall be paid under the Policy until the Policy Schedule, together with such other documents as Old Mutual Wealth may require, is received at Old Mutual Wealth s Head Office. 29. RELEVANT LAW The Terms of this Policy are to be interpreted in accordance with and are governed by English law. 11 of 20