Guide to Understanding the Annual Statement Accumulation Builder, Accumulation Builder II, and Survivorship Plus Indexed Universal Life (IUL)

Transcription

1 Guide to Understanding the Annual Statement Accumulation Builder, Accumulation Builder II, and Survivorship Plus Indexed Universal Life (IUL) Accumulation Builder IUL, and Survivorship Plus IUL are permanent life insurance policies with flexible death benefit protection and the potential for market based cash value accumulation without direct participation in the stock market. Your Annual Statement provides policy values as of the policy anniversary date, as well as a history of the activity on your Indexed Universal Life policy over the last policy year. We have created this guide to help you understand your annual statement and the key terms used to describe your policy. Table of Contents Sample Annual Statement...2 Key Terminology...9 Optional Benefits and Riders...11 We are proud to have received an Excellent rating on our Indexed Universal Life Insurance Annual Statements from DALBAR, a market research firm. This rating is an indicator of Penn Mutual s leadership in producing high-quality electronic and print communications. If you have any questions about your statement, please contact your Financial Professional or Penn Mutual Client Services at

2 Sample Annual Statement This section of the guide walks through a sample Annual Statement to show you the layout and the information presented. The first page includes a summary of key policy Information, while the second page shows the allocations between the different account options, a summary of account activity for each account and any loans taken on the policy. Annual Statement for Policy # Policy Start Date: 01/23/2012 Policy Maturity Date: 01/23/2088 For additional information or questions, contact: WILLIAM PENN 789 SPRUCE STREET SPRINGFIELD PA Insured: WILLIAM PENN Primary Beneficiary: SALLY PENN BENJAMIN FRANKLIN, CLU,ChFC,AEP FRANKLIN-RICHARDS AGENCY SUITE MAIN STREET PHILADELPHIA PA or contact Penn Mutual Client Services Policy Summary Beginning of Policy Year End of Policy Year Year to Year Change * Total Net Death Benefit $1,000, $979, $20, Total Specified Amount $1,000, $1,000, $0.00 Total Policy Value $0.00 $55, $55, * Total Net Cash Surrender Value $0.00 $24, $24, Loan Balance $0.00 $20, $20, * Outstanding loans have been subtracted from these values. Policy Value included in Specified Amount Activity Summary for Statement Period You have Penn Mutual's which Beginning Policy Value $0.00 is a Flexible Premium Indexed Adjustable Life Insurance policy. Total Premiums Paid + $60, As of this statement date, your policy has the following Total Interest Credited + $1, additional benefits: Total Product Charges - $7, Overloan Protection Agreement Partial Surrenders - $0.00 Ending Policy Value $55, Change in Policy Value $55, Loan Repayments Applied $0.00 New Loans & Interest $20, Page 2 Premium and Policy Value Allocations DCA Allocations Policy Value % Policy Value Accounts Prem % The Indexed Fixed Account Account makes up Indexed Account $27, % of the DCA Traditional Loan Account $20, Dollar Cost Averaging (DCA) $6, Premium Allocations Indexed Account (100%) A scheduled premium payment of $1, is due Monthly. Policy Value Allocations We are pleased to introduce your new, redesigned annual statement! All of your policy details are more organized and easier to read with this new statement. Your new statement now includes a concise summary of key information on the front page, with more detailed transaction activity thereafter. For additional details, visit Policy Number: WILLIAM PENN Page 1 of 5 Page 1 Summary of Accounts Account Beginning Premiums Expense Partial Total Index Transfers Ending Value Value and Loan Charges Surrenders and Interest (In and Out) (01/23/2013) (01/23/2012) Repayments and Cost of and Credited Insurance Traditional Loans DCA Account $0.00 $60, $3, $0.00 $1, $52, $6, Indexed Account $0.00 $ $4, $20, $ $52, $27, Credited Interest on $0.00 $ $ $81.12 $81.12 $0.00 $0.00 Loan Account Totals $0.00 $60, $7, $20, $1, $0.00 $34, For more information on the performance of the indexed accounts, please download your indexed account performance report from the Penn Mutual online client service center at or contact your financial representative. Net Policy Value $34, Plus Loan Balance $20, Total Policy Value $55, This guide uses a hypothetical policy as an example. Loans Beginning Loan Balance $0.00 Your policy has an active Traditional Loan during the New Loans statement period. The loan interest rate charged is fixed + $20, and cannot change. To help preserve or replenish your Loan Interest Charged + $ policy values for future use, you can repay all or a portion Principal Repayments of the loan balance at any time. - $0.00 Interest Repayments - $0.00 Traditional Loan Rate 4.00% Ending Loan Balance $20, Indexed Loan Rate 6.00% Policy Number: WILLIAM PENN Page 2 of 5 2

3 Sample Annual Statement Activity history by month appears in the next section of the statement. The final section of the statement includes important notices regarding your policy and information about the annual statement. Activity History for Statement Period Date Premiums Expense Charges Cost of Insurance Partial Surrenders Interest Credited Indexed Earnings Policy Value 01/24/12 $46, $2, $0.00 $0.00 $0.00 $0.00 $44, /23/12 $0.00 $ $ $0.00 $ $0.00 $43, /15/12 $1, $62.50 $0.00 $0.00 $0.00 $0.00 $45, /23/12 $0.00 $ $99.98 $0.00 $ $4.63 $44, /16/12 $1, $62.50 $0.00 $0.00 $0.00 $0.00 $46, /23/12 $0.00 $ $99.88 $0.00 $ $10.91 $45, /15/12 $1, $62.50 $0.00 $0.00 $0.00 $0.00 $47, /23/12 $0.00 $ $99.77 $0.00 $ $16.31 $46, /15/12 $1, $62.50 $0.00 $0.00 $0.00 $0.00 $48, /23/12 $0.00 $ $99.66 $0.00 $ $22.99 $47, /16/12 $1, $62.50 $0.00 $0.00 $0.00 $0.00 $49, /23/12 $0.00 $ $99.56 $0.00 $ $28.36 Notice $48, from the State Insurance Department of New York 08/15/12 $1, $62.50 $0.00 $0.00 $0.00 $0.00 $50, IMPORTANT POLICY OWNER NOTICE: You should consider requesting more detailed information about your policy to 08/23/12 $0.00 $ $99.45 $0.00 understand $ how it may $35.78 perform $49, in the future. You should not consider replacement of your policy or make changes 09/17/12 $1, $62.50 $0.00 $0.00 in your $0.00 coverage without $0.00 requesting $51, a current illustration. You may annually request, without charge, such an 09/23/12 $0.00 $ $99.35 $0.00 illustration $ by calling $ , $50, writing to Penn Mutual at Philadelphia, PA 19172, or by calling your agent. If you do not receive a current illustration of your policy within 30 days from your request, you should contact your state 10/15/12 $1, $62.50 $0.00 $0.00 $0.00 $0.00 $52, insurance department. 10/23/12 $0.00 $ $99.25 $0.00 blank $ $15.07 $51, /15/12 $1, $62.50 $0.00 $0.00 $0.00 $0.00 $53, Declared Rates and Percentages 11/23/12 $0.00 $ $99.15 $0.00 $ $22.54 $52, The following are the interest credited rates declared for the Fixed Account options during the statement period. 12/17/12 $1, $62.50 $0.00 $0.00 $0.00 $0.00 $53, Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan 12/23/12 $0.00 $ $99.05 $0.00 $85.07 $28.71 $53, /15/13 $1, $62.50 $0.00 $0.00 Fixed Account $0.00 $ $54, /23/13 $0.00 $0.00 $0.00 $0.00 DCA Account $71.06 $ $55, Totals $60, $6, $1, $0.00 Holding $1, Account $ $55, for all months during statement period The following are the cap percentage rates that apply to new segments of the Indexed Accounts during the statement period. There is no additional cost of insurance for any additional riders and benefits included with this policy. The maximum premium limit for the following policy year is $139, Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Indexed Account The following are the participation rates that apply to new segments of the Indexed Accounts during the statement period. Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan About this Statement Indexed Account 100 for all months during Your statement statement period provides a history of the activity on Future rates may differ from declared rates listed above. Refer to your contract for more information. your policy for the last policy year ending on 01/23/2013. Please review this statement and contact Penn Mutual if Unlock Life s Possibilities with Your Accumulation Builder you have II IUL any Insurance questions. Policy You should retain a copy of this statement for your personal records, but note that this In addition to providing permanent death benefit protection, your policy statement offers you should the opportunity not be used to build for tax-filing cash purposes. or Penn Mutual (M-F 8:30 a.m. to 6:00 p.m. Eastern) value that can help you achieve goals during your lifetime, such as college funding, a more comfortable retirement, Policy Number: WILLIAM PENN starting a business or buying that Page dream 3 of vacation 5 home. Your policy cash value can also provide a financial safety net if you face an unexpected financial hardship. Talk to your Penn Mutual Financial Professional about maximizing your policy s strong cash value accumulation potential. For more information... on how to read this statement and an explanation of terms and benefits, visit scan the image to the right, or contact Penn Mutual. Accessing cash values may result in surrender fees and charges, may require additional premium payments to maintain coverage and will reduce the death benefit and policy values. Making loan repayments can help protect the policy death benefit and values. Loans are income tax free as long as the policy is not a Modified Endowment Contract (MEC). Withdrawals can cause the policy to become a MEC. Loans will nullify the no-lapse guarantee. Policy Number: WILLIAM PENN Page 4 of 5 Pages 3-5 Policy Number: WILLIAM PENN Page 5 of 5 3

4 Sample Annual Statement - Page 1 WILLIAM PENN 789 SPRUCE STREET SPRINGFIELD PA Insured: WILLIAM PENN Primary Beneficiary: SALLY PENN Annual Statement for Policy # Policy Start Date: 01/23/2012 Policy Maturity Date: 01/23/2088 For additional information or questions, contact: BENJAMIN FRANKLIN, CLU,ChFC,AEP FRANKLIN-RICHARDS AGENCY SUITE MAIN STREET PHILADELPHIA PA or contact Penn Mutual Client Services Includes your: Financial Professional s contact information Policy start and maturity dates Insured and primary beneficiary information. Policy Summary Beginning of Policy Year End of Policy Year Year to Year Change * Total Net Death Benefit $1,000, $979, $20, Total Specified Amount $1,000, $1,000, $0.00 Total Policy Value $0.00 $55, $55, * Total Net Cash Surrender Value $0.00 $24, $24, Loan Balance $0.00 $20, $20, * Outstanding loans have been subtracted from these values. Policy Value included in Specified Amount Lists your policy: Specified Amount Policy Value Cash Surrender Value Death Benefit Outstanding loan balance if applicable. Activity Summary for Statement Period Beginning Policy Value $0.00 Total Premiums Paid + $60, Total Interest Credited + $1, Total Product Charges - $7, Partial Surrenders - $0.00 Ending Policy Value $55, Change in Policy Value $55, Loan Repayments Applied $0.00 New Loans & Interest $20, You have Penn Mutual's which is a Flexible Premium Indexed Adjustable Life Insurance policy. As of this statement date, your policy has the following additional benefits: Overloan Protection Agreement Details: Premium payments Activity during the statement period Interest Credited Product Charges Included benefits and riders Policy type. We are pleased to introduce your new, redesigned annual statement! All of your policy details are more organized and easier to read with this new statement. Your new statement now includes a concise summary of key information on the front page, with more detailed transaction activity thereafter. For additional details, visit Policy Number: WILLIAM PENN Page 1 of 5 Includes informational messaging particular to your policy. 4

5 Sample Annual Statement - Page 2 DCA Allocations The Indexed Account makes up 100% of the DCA Premium Allocations Premium and Policy Value Allocations Accounts Prem % Policy Value % Policy Value Fixed Account Indexed Account $27, Traditional Loan Account $20, Dollar Cost Averaging (DCA) $6, Indexed Account (100%) Policy Value Allocations Details your account allocation percentages between the Indexed and Fixed Accounts for Premiums and Policy Value. Shows the loan balance if any policy value has been allocated to traditional loans. A scheduled premium payment of $1, is due Monthly. Account Beginning Value (01/23/2012) Premiums and Loan Repayments Summary of Accounts Expense Charges and Cost of Insurance Partial Surrenders and Traditional Loans Total Index and Interest Credited Transfers (In and Out) Ending Value (01/23/2013) DCA Account $0.00 $60, $3, $0.00 $1, $52, $6, Indexed Account $0.00 $ $4, $20, $ $52, $27, Credited Interest on $0.00 $ $ $81.12 $81.12 $0.00 $0.00 Loan Account Totals $0.00 $60, $7, $20, $1, $0.00 $34, Summarizes activity during the statement period by account type. Details include: Policy Values Premium payments Interest Credited Product Charges For more information on the performance of the indexed accounts, please download your indexed account performance report from the Penn Mutual online client service center at or contact your financial representative. Net Policy Value $34, Plus Loan Balance $20, Total Policy Value $55, Transfers (In and Out,) Partial surrenders and traditional loans. Also describes where to find more detailed information regarding performance of the Indexed Account. Loans Beginning Loan Balance $0.00 Your policy has an active Traditional Loan during the New Loans + $20, statement period. The loan interest rate charged is fixed and cannot change. To help preserve or replenish your Loan Interest Charged + $ policy values for future use, you can repay all or a portion Principal Repayments - $0.00 of the loan balance at any time. Interest Repayments - $0.00 Traditional Loan Rate 4.00% Ending Loan Balance $20, Indexed Loan Rate 6.00% Provides detail on any loan activity. You have the option of either a Traditional or Indexed Loan. For more information on loans, see the key terminology section. Policy Number: WILLIAM PENN Page 2 of 5 5

6 Sample Annual Statement - Page 3 Date Premiums Expense Charges Activity History for Statement Period Cost of Insurance Partial Surrenders Interest Credited Indexed Earnings Policy Value 01/24/12 $46, $2, $0.00 $0.00 $0.00 $0.00 $44, /23/12 $0.00 $ $ $0.00 $ $0.00 $43, /15/12 $1, $62.50 $0.00 $0.00 $0.00 $0.00 $45, /23/12 $0.00 $ $99.98 $0.00 $ $4.63 $44, /16/12 $1, $62.50 $0.00 $0.00 $0.00 $0.00 $46, /23/12 $0.00 $ $99.88 $0.00 $ $10.91 $45, /15/12 $1, $62.50 $0.00 $0.00 $0.00 $0.00 $47, /23/12 $0.00 $ $99.77 $0.00 $ $16.31 $46, /15/12 $1, $62.50 $0.00 $0.00 $0.00 $0.00 $48, /23/12 $0.00 $ $99.66 $0.00 $ $22.99 $47, /16/12 $1, $62.50 $0.00 $0.00 $0.00 $0.00 $49, /23/12 $0.00 $ $99.56 $0.00 $ $28.36 $48, /15/12 $1, $62.50 $0.00 $0.00 $0.00 $0.00 $50, /23/12 $0.00 $ $99.45 $0.00 $ $35.78 $49, /17/12 $1, $62.50 $0.00 $0.00 $0.00 $0.00 $51, /23/12 $0.00 $ $99.35 $0.00 $ $14.20 $50, /15/12 $1, $62.50 $0.00 $0.00 $0.00 $0.00 $52, /23/12 $0.00 $ $99.25 $0.00 $ $15.07 $51, /15/12 $1, $62.50 $0.00 $0.00 $0.00 $0.00 $53, /23/12 $0.00 $ $99.15 $0.00 $ $22.54 $52, /17/12 $1, $62.50 $0.00 $0.00 $0.00 $0.00 $53, /23/12 $0.00 $ $99.05 $0.00 $85.07 $28.71 $53, /15/13 $1, $62.50 $0.00 $0.00 $0.00 $0.00 $54, /23/13 $0.00 $0.00 $0.00 $0.00 $71.06 $36.98 $55, Totals $60, $6, $1, $0.00 $1, $ $55, Summarizes monthly account activity by activity date, including: Premium payments Product Charges Any Partial Surrenders Interest Credited Indexed Earnings Policy Value on each date There is no additional cost of insurance for any additional riders and benefits included with this policy. The maximum premium limit for the following policy year is $139, Policy Number: WILLIAM PENN Page 3 of 5 6

7 Sample Annual Statement - Page 4 Provides applicable state specific information about your policy. Notice from the State Insurance Department of New York IMPORTANT POLICY OWNER NOTICE: You should consider requesting more detailed information about your policy to understand how it may perform in the future. You should not consider replacement of your policy or make changes in your coverage without requesting a current illustration. You may annually request, without charge, such an illustration by calling , writing to Penn Mutual at Philadelphia, PA 19172, or by calling your agent. If you do not receive a current illustration of your policy within 30 days from your request, you should contact your state insurance department. blank Declared Rates and Percentages The following are the interest credited rates declared for the Fixed Account options during the statement period. Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Fixed Account DCA Account Holding Account 2.00 for all months during statement period The following are the cap percentage rates that apply to new segments of the Indexed Accounts during the statement period. Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Indexed Account The following are the participation rates that apply to new segments of the Indexed Accounts during the statement period. Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Indexed Account 100 for all months during statement period Future rates may differ from declared rates listed above. Refer to your contract for more information. Details by month for the statement period: Interest credited rates declared for the Fixed Account options Cap and participation rates for the Indexed Accounts. Unlock Life s Possibilities with Your Insurance Policy In addition to providing permanent death benefit protection, your policy offers you the opportunity to build cash value that can help you achieve goals during your lifetime, such as college funding, a more comfortable retirement, starting a business or buying that dream vacation home. Your policy cash value can also provide a financial safety net if you face an unexpected financial hardship. Talk to your Penn Mutual Financial Professional about maximizing your policy s strong cash value accumulation potential. Provides details about one of the key features of your policy, the cash value accumulation potential. Accessing cash values may result in surrender fees and charges, may require additional premium payments to maintain coverage and will reduce the death benefit and policy values. Making loan repayments can help protect the policy death benefit and values. Loans are income tax free as long as the policy is not a Modified Endowment Contract (MEC). Withdrawals can cause the policy to become a MEC. Loans will nullify the no-lapse guarantee. Policy Number: WILLIAM PENN Page 4 of 5 7

8 Sample Annual Statement - Page 5 Your statement provides a history of the activity on your policy for the last policy year ending on 01/23/2013. Please review this statement and contact Penn Mutual if you have any questions. You should retain a copy of this statement for your personal records, but note that this statement should not be used for tax-filing purposes. About this Statement For more information... on how to read this statement and an explanation of terms and benefits, visit scan the image to the right, or contact Penn Mutual. Describes the information provided in your annual statement and where to access more information. There is also a Quick Response (QR) Code included in your statement that is readable by an application you can download on your smartphone or tablet computer. Scanning the code will take you directly to a webpage that has more information. Policy Number: WILLIAM PENN Page 5 of 5 12/25/2012 If your coverage is in danger of lapsing in the near future, a message will appear in your statement. It will notify you of the potential lapse date if you do not make additional premium payments and is based on crediting of the minimum guaranteed interest rate and deduction of maximum charges. 8

9 Key Terminology The following are some of the key terms referenced in your Annual Statement. For a more detailed description of terms, please review your Accumulation Builder, Accumulation Builder II or Survivorship Plus IUL policy. Policy Terms Cash Surrender Value The policy value less the surrender charge and any outstanding loans. This amount is available to the policy owner upon full surrender of the policy. Death Benefit The sum of death benefits of the base policy and any riders that offer an additional death benefit. Loans Money borrowed against the policy s cash value. A loan can be taken from the policy value at any time, subject to the maximum loan value in the contract. Loans are not required to be repaid while the policy is active unless the total of accumulated loans exceeds the maximum loan value. Loans will be reflected in the available net cash surrender value and the net death benefit. If loans are outstanding at the insured s death they will reduce the policy value or death benefit. Your policy offers the choice of either a Traditional Loan or Indexed Loan. For Accumulation Builder IUL, the interest rate charged is adjustable and can change each year. For and Survivorship Plus IUL, the interest rate charged is fixed and cannot change. With a Traditional Loan, the interest credited to your loan balance is 1% less than the rate charged for the first 10 policy years. After 10 years, the rate credited is between 0% and 0.25% lower than the rate charged. With an Indexed Loan, the difference between the loan rate charged and the interest credited on loans depends on the performance of the Indexed Accounts. Partial Surrender A partial surrender is a withdrawal from your policy s cash value. The policy death benefit will be reduced by the amount of the withdrawal and a charge of 2% of the amount withdrawn, up to a maximum of $25, will be accessed and treated as an additional withdrawal from the cash value and death benefit. Policy Value The total value in the policy, made up of premiums paid and credited interest, minus policy charges and partial surrenders. Policy Premium The amount of premium paid for the year for the base policy and any elected riders. Specified Amount The amount of coverage defined in your policy that is used to calculate your total death benefit and the amount of product charges assessed to the policy. 9

10 Key Terminology Account Options Fixed Account An account that provides a current interest rate guaranteed for one year from the date funds are allocated, and then guarantees an effective annual rate of at least 2%. Values cannot be transferred from this account until the policy anniversary or within 30 days following the anniversary. 12-Month Dollar Cost Averaging (DCA) Account Account that earns a fixed rate of interest for 12 months from the time of premium allocation and transfers funds monthly to the Indexed Account over a 12 month period. Holding Account A temporary account that is used to hold funds until they transfer into the Indexed Account on the next segment date (a monthly anniversary of the policy date). Indexed Account An account that credits interest based on the performance of a market index. Indexed interest is calculated based on the change in the index between two points in time, subject to a stated cap, participation rate and the minimum annual guaranteed floor. Indexed Account Terms Indexed Segment The Indexed Account is made up of indexed segments. Each premium payment or transfer of funds to the Indexed Account creates an indexed segment. A segment may only be created once a month on the segment date (a monthly anniversary of the policy date). Up to 12 indexed segments can be created in a policy year. Indexed segments that have not yet matured have no indexed earnings above the guarantee. Indexed Earnings The amount of interest credited to an indexed segment. It includes the crediting of monthly interest at the equivalent of the annual guarantee, as well as any additional interest earned for a matured segment. Interest Credited A column in the annual statement that shows the amount of interest credited to the Fixed, 12-Month Dollar Cost Averaging (DCA) and Indexed Account. Participation Percentage The percentage of the participation in a market index s performance for a given time period, used to calculate the index credit for the Indexed Accounts. The participation rate is guaranteed never to be less than 100%. Cap Percentage The maximum amount of interest that can be earned in an Indexed Account. This cap is subject to change, but is guaranteed to never be below the minimum. If a cap percentage changes, that change is effective only for new or renewed segments. Current Allocation Shows the percent allocation of future premiums between the Fixed, 12-Month Dollar Cost Averaging (DCA) and Indexed Account. 10

11 Optional Benefits and Riders Accumulation Builder and You may have elected one or more of the following benefits and riders on your policy. Provided below is a brief description of these riders. For complete information on the riders on your policy, please review your annual statement and contract for more details. Accidental Death Benefit provides an additional death benefit if the insured dies as the result of an accident. Additional Term Insurance Agreement Rider extends life insurance to a family member without obtaining an additional policy. Business Accounting Rider designed for business owners who want to minimize early accounting charges on their company financial statements. For a monthly charge, this rider will waive all surrender charges on the policy. Cash Value Enhancement Rider allows policies owned/sponsored by a corporation, business or trust to reflect higher cash values on their balance sheets during the first five policy years. Children s Term Insurance Agreement Rider can be purchased to cover all of your children, and each covered child is guaranteed the opportunity to convert their child coverage to a permanent policy when they reach age 23. Chronic Illness Accelerated Benefit Rider * allows access to a portion of the death benefit if the insured is diagnosed with a chronic illness. Please see your contract for full eligibility requirements for accessing the benefit. Disability Completion Benefit Rider waives policy charges and credits a pre-determined premium to policy cash values if disability occurs. Disability Waiver of Monthly Deductions Rider protects the policy if total disability occurs. Guaranteed Increase Option Rider allows you to increase your coverage at certain ages without having to submit medical evidence of insurability. Overloan Protection Rider can keep your coverage intact despite outstanding loans. Return of Premium Rider provides an added death benefit equal to premiums paid, up to the most recent anniversary. Supplemental Exchange Agreement Rider** permits replacement of one of the insureds if a relationship changes without having to purchase a new. Supplemental Term Insurance Rider provides an additional death benefit while the rider is in force and improves long-term cash values. Not available with Accumulation Builder IUL * In TX: Long-Term Care Accelerated Benefit ** In Oregon, Change of Ownership Agreement 11

12 Optional Benefits and Riders Survivorship Plus IUL You may have elected one or more of the following benefits and riders on your policy. Provided below is a brief description of these riders. For complete information on the riders on your policy, please review your annual statement and contract for more details. Chronic Illness Accelerated Benefit Rider* allows access to a portion of the death benefit if the surviving insured is diagnosed with a chronic illness. Please see your contract for full eligibility requirements for accessing the benefit. Estate Growth Benefit Rider protects against inflation by automatically increasing the policy s coverage amount by a fixed percentage each year, beginning in the second policy year. Estate Preservation Term Insurance Rider helps offset estate taxes if a death occurs before policy ownership transfers. Extended No-Lapse Guarantee Rider extends the Base No-Lapse Guarantee up to age 121 of the younger insured. First Death Benefit Rider adds protection for the surviving insured after the first death. Flexible Period Single Life Term Rider provides additional term coverage for one of the insureds. Overloan Protection Rider keeps your policy in force despite outstanding loans. Policy Split Option Rider allows a joint policy to be divided into two individual universal life insurance policies under certain conditions. Return of Premium Term Insurance Rider provides an added death benefit equal to premiums paid, up to the most recent anniversary. Supplemental Exchange Agreement Rider** permits replacement of one of the insureds if a relationship changes without having to purchase a new or additional policy. Supplemental Term Insurance Rider provides an additional death benefit while the rider is in force and improves long-term cash values. * In TX: Long-Term Care Accelerated Benefit ** In Oregon, Change of Ownership Agreement 12

13 Our Noble Purpose Since 1847, Penn Mutual has been driven by our noble purpose to create a world of possibilities, one individual, one family and one small business at a time. As an original pioneer of mutual life insurance in America, we believe that life insurance is the most protective, responsible and rewarding action a person can take to build a solid foundation today and create a brighter future for generations to come. Accumulation Builder IUL,, and Survivorship Plus IUL are indexed universal life insurance policies offered by The Penn Mutual Life Insurance Company and The Penn Insurance & Annuity Company, a wholly owned subsidiary of Penn Mutual. Products and features may not be available in all states. Policy form numbers: IFL-07(S), IFL-07(U), IALJ-08 (Policy form numbers may vary by state.) All guarantees are based upon the claims-paying ability of the issuer. Accessing cash values may result in surrender fees and charges, may require additional premium payments to maintain coverage and will reduce the death benefit and policy values The Penn Mutual Life Insurance Company, Philadelphia, PA T /13 A3CD E3