How to read your annual statement

Your annual statement provides key information on the status of your policy as of your anniversary date. It also provides you with a projection of values, based on current and guaranteed charges and interest rates.

It’s important to examine your annual statement carefully. The information below will provide you with additional details about the sections you may find on your annual statement. This information will vary by policy and will not apply to all policyholders. Please reference your annual statement to confirm the information that applies to your specific policy.

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Summary of coverage

Continuation of insurance sections

This section of your annual statement will vary depending on your coverage type and active riders/benefits.

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Summary of transactions

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Face amount:
This is the amount of insurance you selected at policy issue, adjusted for any changes you’ve made since that time.

Benefits and riders1: 
Acceleration of Death Benefit Rider: If the insured becomes terminally ill this rider will provide for the discounted payment of all, or a portion of the total death benefit available.

(Joint) Coverage Continuation Rider/Benefit:
The Coverage Continuation Rider/Benefit guarantees that the death benefit will remain in force even if the base policy’s cash value is depleted, provided that sufficient premiums have been paid, as shown on the policy specifications page. The Coverage Continuation Rider/Benefit value must remain positive and greater than the loan balance to maintain the rider/benefit.  This value is not available to you. Any delays or variation in the payment will affect this rider and the duration of the policy guarantee that the rider or benefit provides.  

Guaranteed Survivor Income Rider/Benefit:
This rider was designed so that the beneficiary will have the option of exchanging the lump sum death benefit proceeds of a life policy for enhanced lifetime guaranteed monthly payments through an annuitization process. 

Waiver of Specified Premium Rider:
The Waiver of Specified Premium is a rider that waives a specified monthly premium amount if the insured becomes disabled after the policy anniversary at attained age 5, but before the policy anniversary at attained age 60, and in the event that the disability continues without interruption for at least six months. If the policyholder becomes disabled between the policy anniversary at attained age 60 and the policy anniversary at attained age 65, the benefit ends no later than age 65.

Cash Value:
The Cash Value forms the basis for the benefits provided under your policy. It is calculated by taking the prior Cash Value, plus the premiums you paid, and the interest earned, minus the cost of insurance and other charges, the cost of riders (if applicable), and any withdrawals you have made. Specific details on how your Cash Value is calculated may be found in your policy.

Surrender Charge:
A surrender charge is a deduction from the policy’s cash value. To find out more information regarding Surrender Charges, please review your policy.

A Surrender Charge is taken for the following transactions:

  • Upon surrender
  • Upon lapse
  • Upon a partial withdrawal that decreases the Face Amount
  • Upon a change in Death Benefit Option that decreases the Face Amount
  • Upon a requested decrease in Face Amount

Loan Balance/Outstanding Loan:
This shows the outstanding balance of all loans that have been taken and not yet repaid. 

Net Cash Surrender Value:
The Net Cash Surrender Value is the cash that is available if you were to fully cancel your policy. It is equal to the Cash Value, minus any outstanding policy loans and loan interest due, and minus any applicable Surrender Charge as outlined in your policy. As your Policy states, your Net Cash Surrender Value, must be sufficient to pay your next monthly deduction. 

Guaranteed Interest Rate:
The Minimum Cash Value Guaranteed Interest Rate shown on the Policy Specifications page.

Non-Carryover Loan Interest Rate/Loan Interest Rate in Arrears:
Interest on loans will be charged at a rate not to exceed the Maximum Fixed Loan Interest Rate applicable to the policy year as shown on the Policy Specifications page. The Loan Interest is due each year on the policy anniversary.

Interest Crediting Rate on Borrowed Funds:
If you borrow against the Cash Value, the interest rate used to calculate the interest earned on the Cash Value securing any Loan.

Cash Value / Interest Crediting Rate:
The interest credited to the non-loaned Cash Value for a specific month will be at an effective annual rate not less than the Minimum Cash Value Guaranteed Interest Rate shown on the Policy Specifications page.

Total Current Death Benefit:
As of the statement date, this is the amount that would be paid to the beneficiary(ies) upon the death of the insured.  Full details on how this amount is calculated may be found in your policy.