Find the right balance between protection and security

Transcription

1 TOTALACCUMULATOR SM Find the right balance between protection and security This brochure must be accompanied by a current TotalAccumulator SM prospectus, which contains more detail on the product and fund portfolios, including information on charges and expenses.

2 Focus on the things that matter most. It s important for you to take care of your family and your future. You want to balance essential life insurance protection with the potential for cash value accumulation, and TotalAccumulator may be your answer. This variable universal life insurance coverage can help you protect your loved ones, pursue potential cash accumulation, and prepare for what lies ahead.

3 Defining Variable Universal Life Insurance. This type of life insurance policy offers death benefit coverage with the potential to accumulate cash value. Flexibility is available with premium payments, payment schedules, and death benefits. Your premium payments are invested in your choice of a variety of options known as subaccounts. This effectively increases the cash value accumulation potential as well as the risk. No investment is guaranteed to deliver returns to preserve your principal. Since cash value depends on the performance of the subaccounts you choose, there is the potential for losing cash value, which could cause your policy to lapse.

4 Protect your loved ones. TotalAccumulator helps you provide a level of security for your family with an income tax-free death benefit. And to make sure that potential market drops and cash value declines don t put your life insurance at risk, you have coverage guarantee options. Safety Net Premium Guarantee This automatic guarantee ensures that your policy will not lapse no matter how your subaccount options perform, as long as you continue to make required premium payments on time, according to the following schedule: for issue ages 0-70, 10 years for issue ages 71-75, to age 80 for issue ages 76+, 5 years Coverage Guarantee Rider If you want to extend the guarantee period beyond the Safety Net Premium Guarantee period, you can add this rider when you purchase the policy. Two guarantee levels are available with the Coverage Guarantee Rider. The Extended Coverage Guarantee ensures that coverage will not lapse until you turn 70 or the policy reaches its 20th year, whichever is later. The Lifetime Coverage Guarantee can extend this protection for as long as you live. Each rider option is available at an additional cost when you purchase the policy, with the Lifetime Coverage premiums being higher than the Extended Coverage premiums. Your policy is guaranteed to remain in force, regardless of market conditions, as long as you make the required premium payments. The Coverage Guarantee Rider also offers additional flexibility with regard to the premium requirements. With this rider, you can temporarily reduce or take time off from premium payments. You then have up to 18 months to catch up with any missed payments. Note that loans, if not repaid, and withdrawals will reduce the death benefit and the amount available upon surrender and will reduce the benefits of the Coverage Guarantee Rider. The Coverage Guarantee Rider is available at an additional cost and is subject to state availability, restrictions, and limitations. When considering this rider (or any other riders) please request a policy illustration from your financial representative to see the impact on the value of your policy.

5 Pursue potential cash value growth. TotalAccumulator provides you with the opportunity to grow the policy s cash value. With this variable universal life coverage, you can allocate your premium payments to your choice of more than 50 subaccount options managed by professional fund managers. You also have the option of allocating your premiums into the fixed account, which provides a more predictable fixed interest rate. If you need some assistance with your allocation choices, SelectBalance SM Asset Allocation Program is a great solution. It can take some of the guesswork out of the process by helping you analyze your risk tolerance and anticipated time frame. The analysis can ultimately assist you in selecting one of the five subaccounts available with SelectBalance. All earnings grow on a tax-deferred basis in your selected subaccounts, and you can transfer money among the subaccounts tax-free. Ultimately, your policy s value will depend on the market performance of the subaccounts you choose as part of your policy. Neither asset allocation nor diversification ensures a profit or protects against a loss in a declining market.

6 Subaccount Options by Asset Class 1 LARGE CAP VALUE LARGE CAP BLEND LARGE CAP GROWTH AB VPS Growth and Income 27 Fidelity VIP Equity-Income 2,7 Invesco V.I. Growth and Income Fund 2 Franklin Mutual Shares VIP 2,4,11,14,15 Oppenheimer Main Street 2,3,11 Fidelity VIP Contrafund 2,3 Fidelity VIP Index Alger Capital Appreciation 3,12 Alger Large Cap Growth Fidelity VIP Growth 2 Fidelity VIP Growth & Income 2,4,7 Janus Henderson Forty 2,9,26 MID CAP VALUE MID CAP BLEND MID CAP GROWTH AB VPS Small/Mid Cap Value 3,27 Invesco,V.I. American Value Fund - Series I 3 Janus Henderson Mid Cap Value - Institutional Shares 2,3,26 Fidelity VIP Value Strategies 2,3 Alger Mid Cap Growth 3 Fidelity VIP Mid Cap 2,3 Franklin Small-Mid Cap Growth VIP 3,14,16,19 Janus Henderson Enterprise 2,3 SMALL CAP VALUE SMALL CAP BLEND SMALL CAP GROWTH Franklin Small Cap Value VIP 2,3,14 Oppenheimer Main Street Small-Cap Fund/VA 2,3 AB VPS Small Cap Growth 3,27 ASSET ALLOCATION BALANCED GLOBAL/INTERNATIONAL Morningstar Aggressive Growth ETF Asset Allocation Portfolio 2,3,8,20,21,22,23 Morningstar Balanced ETF Asset Allocation Portfolio 2,3,8,20,21,22,23 Morningstar Conservative ETF Asset Allocation Portfolio 2,3,8,20,21,22,23 Morningstar Growth ETF Asset Allocation Portfolio 2,3,8,20,21,22,23 Morningstar Income and Growth ETF Asset Allocation Portfolio 2,3,8,20,21,22,23 Alger Balanced Franklin Income VIP 4,7,14,17,18 Janus Henderson Balanced 2,4,25 Oppenheimer Conservative Balance Fund/VA 2,3,4,28 AB VPS International Growth 2,27 AB VPS International Value 2,27 Fidelity VIP Emerging Markets 2 Janus Henderson Overseas 2,26 Franklin Mutual Global Discovery VIP 2,3,4,11,14,15 Oppenheimer Global Fund/VA 2,3 Oppenheimer International Growth/VA 2,3 FIXED INCOME HIGH YIELD SPECIALTY Fidelity VIP Investment Grade Bond 2,4,7,13 Fidelity VIP Government Money Market 5,29 Franklin Strategic Income VIP 2,4,8,14,17,18 Franklin U.S. Government Securities VIP 14,17 Invesco V.I. Government Securities Fund Series I 18,24 Janus Henderson Flexible Bond 2,4,25 Oppenheimer Total Return Bond Fund/VA 2,3,4 Oppenheimer Global Strategic Income/VA 2,3,4 Templeton Global Bond VIP 2,7,8,9,14,16 Fixed Accounts Fidelity VIP Real Estate 2,6 Fidelity VIP High Income 2,4,7 Janus Henderson Global Research 2,6

7 1 Certain underlying portfolios may be absorbing, on a voluntary basis, some portion of portfolio expenses. Without these arrangements, which can be subject to change at any time, the total performance returns of such portfolios would be less. Stocks offer the potential for long-term gains but can be subject to short-term volatile price movements. The performance of individual stocks and/ or sectors can, at times, significantly exceed historical norms. Stocks and stock markets are volatile and fluctuate in response to company-specific factors, and general market, political, regulatory and economic conditions. Investors generally should not expect such extraordinary results. Portfolios offered by variable insurance trusts may not be managed by the same portfolio managers who manage retail mutual funds with similar names. These portfolios are likely to differ from retail mutual funds in assets, cash flow, and tax matters. Accordingly, the holdings and performance of these portfolios can be expected to vary from retail mutual funds. Each subaccount has its own unique risks associated with an investment in the underlying portfolio. For a detailed description of these principal risks, please refer to the portfolio prospectuses before investing. 2 Foreign and emerging market securities, in which certain of the portfolios may invest, pose different and possibly greater risks than those associated with domestic securities, including currency fluctuations, economic instability, and social, political and regulatory developments. These risks are heightened in emerging markets. Emerging market securities also involve heightened risks due to their smaller size and potential lack of liquidity. International funds focus their investments in the securities of foreign issuers. 3 Portfolios that invest in securities issued by small cap, mid cap, or emerging growth companies have a greater risk of price fluctuation than portfolios that invest in securities of larger, more established companies. 4 Certain portfolios may invest in below-investment-grade securities, which carry a greater risk of default. Investments in these securities are concentrated in high-yield, fixed-income securities, also known as junk bonds. As they tend to be more volatile than higher rated bonds, these securities have a higher credit risk and a higher possibility of loss of principal. 5 Money market funds are not insured or guaranteed by the Federal Deposit Insurance Corporation (FDIC) or any other government agency. Although the fund seeks to maintain a constant share price of $1, it is possible to lose money by investing in the fund. 6 The underlying fund s concentration in a single sector makes it subject to greater risk and volatility than other funds that are more diversified. The value of its shares may be substantially affected by economic events within the sector. 7 In general the bond market is volatile, and fixed-income securities are subject to interest rate risk, prepayment risk and market risk. 8 Risks of derivatives include imperfect correlation between the value of the instruments and the underlying assets; risks of default by the other party to certain transactions; risks that the transaction may result in losses that partially or completely offset gains in portfolio positions and risks that the instruments may not be liquid. Certain derivative instruments may not be liquid. Certain derivative instruments may give rise to a form of leverage, which could cause the Portfolio to sell securities when it may not be advantageous to do so and may cause volatility. The more a fund invests in leveraged instruments, the more the leverage will magnify any gains or losses on those investments. 9 The fund is classified as non-diversified, meaning it has the ability to take larger positions in a smaller number of issuers than a diversified fund. As a result, an increase or decrease in the value of a single security may have a greater impact on the portfolio s NAV and total return. Non-diversified funds may experience greater price volatility. 10 The portfolio s Service Class shares (12b-1 class) were first offered on November 3, For periods prior to this date, the performance shown is based on the historical performance of the portfolio s Initial Class shares (non-12b-1 class), adjusted to reflect the 12b-1 fees of the portfolio s 12b-1 class shares. 11 Value stocks may fail to rebound, and the market may not favor value-style investing. 12 The Portfolio can leverage, that is, borrow money to buy additional securities. By borrowing money, the Portfolio has the potential to increase its returns if the increase in the value of the securities purchased exceeds the cost of borrowing, including interest paid on the money borrowed. The cost of borrowing money to leverage could exceed the returns for the securities purchased or the securities purchased may actually go down in value; thus, the Portfolio s net asset value could decrease more quickly than if the Portfolio had not borrowed. 13 The fund can invest in securities that may have a leveraging effect (such as derivatives and forward-settling securities) that may increase market exposure, magnify investment risks and cause losses to be realized more quickly. 14 A series of Franklin Templeton Insurance Products Trust, shares of which are generally sold only to Insurance Company separate accounts to serve as investment options for variable insurance products. 15 Invests in companies involved in mergers, liquidations, reorganizations and bankruptcies, which may include defaulted debt, involve higher credit and other risks. 16 By having considerable investments in one or more countries or particular sectors from time to time, the fund may experience more volatility than a fund with a more broadly diversified portfolio. 17 Interest rate movements and mortgage prepayment rates may impact the fund s share price and yield. Thus as the prices of bonds in the fund s portfolio adjust to a rise in interest rate, the fund s share price may decline. 18 Floating-rate loans and high-yield corporate bonds are rated below investment grade and are subject to greater risk of default, which could result in loss of principal a risk that may be heightened in a slowing economy. 19 This fund includes investments in the technology sector, which has been highly volatile and involves special risks. 20 The Morningstar ETF Allocation Series Portfolios are not Exchange Traded Funds (ETFs), instead they consist of five risk-based asset allocation portfolios that invest in underlying ETFs, which are typically open-end investment companies or unit investment trusts. 21 The Portfolio allocates investments among multiple ETF asset classes including: U.S. equity, fixed income, real estate and international ETFs. 22 Asset allocation does not assure a profit or protect against down markets. 23 Real estate investments are subject to specific risks, such as risks related to general and local economic conditions and risks related to individual properties. 24 On or about May 2, 2011 the Invesco Van Kampen V.I. Government Fund Series I was reorganized into the Invesco V.I. Government Securities Fund Series I; accordingly, we created the Invesco V.I. Government Securities Series I Subaccount, into which we merged the Invesco Van Kampen V.I. Government Series I Subaccount. 25 Bond funds have the same interest rate, inflation, and credit risks that are associated with the underlying bonds owned by the fund. Unlike owning individual bonds, there are ongoing fees and expenses associated with owning shares of bond funds. The return of principal is not guaranteed due to net asset value fluctuation that is caused by changes in the price of specific bonds held in the fund and selling of bonds within the fund by the portfolio manager. 26 The Portfolio pays an investment advisory fee rate that adjusts up or down by a variable of up to 0.15 percent (assuming constant assets) on a monthly basis based upon the Portfolio s performance relative to its benchmark index during a measurement period. 27 Effective May 1, 2015, the AllianceBernstein VPS Growth and Income Portfolio - Class A, AllianceBernstein VPS International Growth Portfolio - Class A, AllianceBernstein VPS International Value Portfolio - Class A, AllianceBernstein VPS Small Cap Growth Portfolio - Class A and AllianceBernstein VPS Small/Mid Cap Value Portfolio - Class A changed its name to AB VPS Growth and Income Portfolio - Class A, AB VPS International Growth Portfolio - Class A, AB VPS International Value Portfolio - Class A, AB VPS Small Cap Growth Portfolio - Class A and AB VPS Small/Mid Cap Value Portfolio - Class A; respectively. 28 Effective April 30, 2015, the Oppenheimer Capital Income Fund/VA changed its name to Oppenheimer Conservative Balance Fund/VA. 29 Effective December 1, 2015, the Fidelity VIP Money Market Portfolio changed its name to Fidelity VIP Government Money Market Portfolio. FUND MANAGERS The investment subaccounts available through TotalAccumulator are managed by the following fund managers: Investments

8 Prepare for the future. Because life is always changing, TotalAccumulator offers you a significant amount of flexibility when it comes to altering your policy. You have the ability to: Change your death benefit option. Increase or decrease your death benefit. 30 Use sufficient cash value to cover premium payments. You can also access policy funds if needed. Partial withdrawals and loans can be taken from the policy cash value to help you manage large or unexpected expenses as well as supplement your retirement income. 31 And early payment of part of the death benefit may be available in the event of terminal illness or nursing home confinement. 32 Refer to the Understand the Important Information section of this guide. Increases in benefits are subject to underwriting approval. Changes to benefits can have income tax consequences. Consult a tax advisor for additional information. SelectStrategy SM To help you get the most out of your policy, you need to know which goals are most important to you. SelectStrategy is a life insurance planning and illustration tool from Lincoln Benefit Life that can help you determine a strategy and identify which TotalAccumulator options may work best with your needs. Ask your Allstate Personal Financial Representative for more information and the SelectStrategy brochure. SelectStrategy is not binding, and it is not required to purchase a TotalAccumulator policy. 30 Increases in benefits are subject to underwriting approval. Changes to benefits can have income tax consequences. Consult a tax advisor for additional information. 31 Partial withdrawals and surrenders from life policies are generally taxed as ordinary income to the extent the withdrawal exceeds your investment in the contract, which is also called the basis. In some situations, partial withdrawals during the first 15 policy years may result in taxable income prior to recovery of the investment in the contract. Loans are generally not taxable if taken from a life insurance policy that is not a modified endowment contract. However, when cash values are used to repay a loan, the transaction is treated like a withdrawal and taxed accordingly. If a policy is a modified endowment contract, loans are treated as a taxable distribution to the extent of policy gain. On a MEC, loans, withdrawals and surrenders are treated first as distributions of the policy gain subject to ordinary income taxation, and may be subject to an additional 10% federal tax penalty if made prior to age 59½. Loans, if not repaid, and withdrawals reduce the contract s death benefit and cash value. 32 Receipt of accelerated benefits may be taxable. Tax laws relating to accelerated benefits are complex. Please consult a tax advisor. Receipt of accelerated benefits may also impact eligibility for public assistance programs.

9 Understand the important information. Surrender Charges Surrender charges apply during the first 10 policy years and for 10 years from the effective date of any face amount increase. Charges range from $0 to $49 per $1,000 of face amount (based on the insured s age at issue, sex, and smoking status) and decrease over the life of the policy. Tax Information That May Impact Your Policy You should always consult with your tax advisor when making any decisions regarding your policy. The Internal Revenue Code includes certain rules governing the taxation of life insurance. The death benefit of a life insurance policy is generally received by the beneficiaries free from income tax. However, the death benefit of life insurance policies that have been transferred for value may be subject to ordinary income taxes. Estate taxes may apply. Consult your tax advisor for additional information. Partial withdrawals and surrenders are generally taxed as ordinary income to the extent the withdrawal exceeds the investment in the contract, which is also called the basis. In some situations, partial withdrawals during the first 15 policy years may result in taxable income prior to recovery of the basis in the contract. Loans are generally not taxable if taken from a life insurance policy that is not a modified endowment contract (MEC). However, when cash values are used to repay a loan, the transaction is treated like a withdrawal and taxed accordingly. Unpaid interest on loans is added to the loan principal, thereby increasing the total debt on the policy. The combination of an increasing loan balance and deductions for contract charges and fees may cause the policy to lapse, triggering ordinary income tax on the outstanding loan balance to the extent it exceeds the cost basis in the policy. Loans, if not repaid, and withdrawals reduce the policy s death benefit and cash surrender value.

10 MEC Tax Facts A MEC is a type of life insurance policy for which the premiums paid into the policy have exceeded certain limitations set forth in the Internal Revenue Code. If a policy is a MEC, loans and withdrawals are subject to different income tax rules. If a policy is a MEC, loans are treated as a taxable distribution to the extent of policy gain. Loans, withdrawals, and surrenders from MECs are treated first as distributions of the policy gain subject to ordinary income taxation and may be subject to an additional 10% federal tax penalty if made prior to age 59½. Policy Details Issue Ages 0 80 Minimum Death Benefit $100,000 Death Benefit Options Option 1 A death benefit that stays the same over time. Option 2 An increasing death benefit equal to the base coverage amount plus the policy value. Available Riders Accelerated Death Benefit Rider Permanent Confinement Accelerated Death Benefit Rider Terminal Illness Overloan Protection Rider Optional Riders Accidental Death Benefit Rider Additional Insured Rider Children s Level Term Rider Coverage Guarantee Rider Disability Continuation of Payment Rider Guaranteed Insurability Rider Prime Term Rider For more details, refer to the information in this brochure or ask your Personal Financial Representative.

11 Find the right balance. With variable life insurance coverage, you can get a level of security for your loved ones and the potential for financial growth all in one product. Now that s a policy that can help you take care of what s important your family and your future. Contact your Allstate Agency today to discuss how TotalAccumulator variable universal life insurance can work for you.

12 We re here for you. Your Allstate Agency is always here for you when something goes wrong. We re also here to help things go right with innovative solutions and professional assistance to help you protect your family and achieve your lifelong dreams. To learn more, call or visit your Allstate Agency today. All guarantees are based on the claims-paying ability of the issuing insurance company. Variable universal life insurance policies carry annual insurance company mortality and expense risk charges, withdrawal charges in the early years, and administrative fees. Individual features may be offered at an additional cost. The value of a variable universal life insurance policy will fluctuate with the investment performance of the underlying subaccounts and may be worth more or less than the original investment. Management fees and/or other expenses also apply on an ongoing basis for each subaccount portfolio available under the policy. Please see the prospectus for more details concerning any applicable fees and each subaccount portfolio s expense. TotalAccumulator SM VUL is a flexible premium variable adjustable life insurance policy issued by Lincoln Benefit Life Company, 1221 N. St. Ste 200, Lincoln NE and is available in most states with contract/series VUL0750 and may be accompanied with the following rider UL0202, UL0416, UL0619, UL0613, UL0737, UL0615, UL0614, VUL0736, UL0706, UL0701, and UL0738. Policy issuance is subject to availability and qualifications. This policy has exclusions, limitations, and terms that may affect coverage, renewal, cancellation, termination, or other contractual rights and benefits. Variable universal life products are long-term investments designed to provide life insurance protection and flexibility in connection with premium payments and death benefits. You should carefully consider the investment objectives, risks, charges, and expenses of the investment alternatives before purchasing a policy. These policies have limitations and are sold by prospectus only. The prospectus contains details on the investment alternatives, policy features, the underlying portfolios, fees, charges, expenses, and other pertinent information. To obtain a prospectus or a copy of the underlying portfolio prospectuses, please contact Lincoln Benefit Life Company. Please read the prospectuses carefully before purchasing a contract. Please note that neither Allstate nor its agents and representatives can give legal or tax advice. The brief discussion of taxes in this brochure may not be complete or current. The laws and regulations are complex and subject to change. Consult your attorney or tax advisor for complete details. This information is provided for general consumer educational purposes and is not intended to provide legal, tax or investment advice. Lincoln Benefit Life issues fixed and variable insurance products that are sold through agreements with affiliated or unaffiliated broker-dealers or agencies. Securities offered by Personal Securities offered by Personal Financial Representatives through Allstate Financial Services, LLC (LSA Securities in LA and PA). Registered Broker-Dealer. Member FINRA, SIPC. Main Office: 2920 South 84th Street, Lincoln, NE (877) Check the background of this firm on FINRA s BrokerCheck website ALR / Allstate Insurance Company allstate.com