Income Rider Brochure - Total Value Annuity

A N N U I T YTOTAL VALUEINCOME RIDER®

THE SECURITY BENEFITTOTAL VALUE ANNUITYGUARANTEED LIFETIME WITHDRAWAL BENEFIT(GLWB) RIDER.For many Americans, retirement is a time to look forward to and anticipatea more leisurely lifestyle dedicated to hobbies, grandchildren, travel andmuch more. Making sure you have an amount of income that you cannever outlive is an important consideration when planning how you’ll liveduring those years.A key risk facing retirees is longevity – outlivingyour retirement savings. For a couple aged 65,there is a 50% chance one spouse will live to age92 and a 25% chance one will live to age 97 1 .The optional Income Rider is available with theSecurity Benefit Total Value Annuity issuedby Security Benefit Life Insurance Company.It is designed to help address longevity riskby providing you with a guaranteed streamof income you cannot outlive.Selected at the time the contractis purchasedAt the time you purchase the Total ValueAnnuity, you’ll have the opportunity topurchase one of two optional riders, either theIncome Rider or the Death Benefit Rider. Onlyone of the riders may be purchased, so it isimportant to understand what matters most toyou, creating a guaranteed stream of income forlife, or securing your legacy through passing on aportion of your retirement savings to thoseyou care about.This brochure explains the Income Riderfeatures and benefits. If you and your advisordetermine that you wish to leave something forthose you care about, please refer to the DeathBenefit Rider brochure.1Annuity 2000 Mortality Table; Society of Actuaries.

HOW DOES THEINCOME RIDER WORK?An important feature of your Total Value Annuity is its protection of yourpurchase payments and previously credited interest against marketdownturns. When you purchase the Income Rider, you’re giving yourselfsecurity – and you’re also guaranteeing that if you only withdraw a setamount each year, called the Lifetime Annual Income, it will be availablefor the rest of your life.In the following pages, we will explainhow the Income Rider can provide incomethat you can’t outlive. First, let’s discuss somekey concepts:Income Benefit Base:The Income Benefit Base is used to computethe Lifetime Annual Income and the chargefor the Income Rider. The Income BenefitBase is equal to your purchase payments, plusthe bonus on purchase payments in the firstyear, plus the Stacking Roll-up, reduced forpartial withdrawals. It is not a cash value andcannot be accessed; it is not an amount that isavailable for withdrawal, as a death benefit or forannuitization. Withdrawals reduce the IncomeBenefit Base, and the reduction may be morethan the amount of the withdrawal.Stacking Roll-up:The Stacking Roll-up increases the IncomeBenefit Base. The Stacking Roll-up is calculatedby adding together the weighted interestrates applied to your Account Value with theguaranteed 4% stacked on top. It applies oneach contract anniversary during the StackingRoll-up Term. In addition, an Interim TermStacking Roll-up may apply when you begintaking Lifetime Annual Income.Stacking Roll-up Term:The Stacking Roll-up Term begins on thecontract date and ends on the earliest of the 10 thcontract anniversary, the contract anniversaryyou reach age 85, or the date you begin takingLifetime Annual Income. It may be renewed foranother 10 years.The Income Rider 3

Account Value:This is the value of your Total Value Annuity, andis the amount available to you for withdrawals, lessany applicable surrender charges, bonus recapture,market value adjustment (MVA), premium tax andIncome Rider charges.Lifetime Withdrawal Rate:This is the age-based percentage that appliesto the Income Benefit Base to determine yourLifetime Annual Income on the date youelect to start the Income Phase. Once youtake Lifetime Annual Income, the LifetimeWithdrawal Rate is set and does not change. Ifyou delay taking Lifetime Annual Income, theLifetime Withdrawal Rate increases each year.It starts at 3.80% at age 50 and grows 0.10%annually until it reaches 7.80% at age 90 orabove. If you elect to receive Lifetime AnnualIncome for your and your spouse’s lives, theLifetime Withdrawal Rate is 0.70% less eachyear and is based on the youngest spouse, andthe income lasts until the death of the lastsurviving spouse.Lifetime Annual Income:This is the amount you may withdraw each yeareven if the Account Value is zero, so long as youonly withdraw the Lifetime Annual Income.It is computed using the Income Benefit Baseand the Lifetime Withdrawal Rate on the dateyou elect to start the Income Phase. If a higheramount is required for Required MinimumDistribution (RMD) for a particular year,the Lifetime Annual Income will increaseto equal the RMD.4 Security Benefit

GUARANTEEDINCOME FOR LIFEThe purchase of the optional Income Rider with the Total Value Annuityguarantees that you will have a steady stream of income, so long as youonly withdraw the Lifetime Annual Income, for the rest of your life. Thelonger you delay taking income, the greater the Income Benefit Base andLifetime Annual Income will be. Remember, your Lifetime WithdrawalRate increases each year that you delay taking income. If you begintaking withdrawals before beginning Lifetime Annual Income, or if youtake withdrawals in excess of the Lifetime Annual Income, the amountyou can subsequently take as Lifetime Annual Income will be reducedand could be reduced to zero.Up to an 8% bonusWhen you purchase the Lifetime Income rider,you receive a bonus of up to 8% on all purchasepayments made in the first contract year. 2 TheBonus is applied to both your Account Valueand the Benefit Base. The amount of the bonusdepends upon the state in which you live.The chart on the next page shows thebonus amounts for the Total Value AnnuityContract with or without the Income Rider. Ifyou surrender, take partial withdrawals in excessof the free withdrawal amount (10% annuallyafter the first contract anniversary), or elect toreceive annuity payments prior to the end of thesurrender charge period, a bonus recapture willapply. A bonus recapture will also apply if a jointowner who is not the spouse of the Annuitant diesprior to the end of the surrender charge period.Bonus amounts for the Total Value Annuity ContractStatesAll states except those CA, FL ME CT, DElisted at rightBonus 7% 6% 5% 2%Bonus w/Income Riderpurchase8% 7% 6% 2%If the Total Value Annuity and Income Rider was purchased in a state in which the 8% bonus applies,with an initial purchase payment of $200,000 on the contract date:Bonus Account Value Income Benefit Base 3$16,000 $216,000 $216,0002 Bonus annuities may include lower caps or interest rates, longer surrender charge periods, higher surrender charges or other restrictionsthat are not included in annuities that don’t offer a bonus feature.3 Not an amount that is available for withdrawal, or as a death benefit or for annuitization.The Income Rider 5

Stacking Roll-up: Interest creditingoption interest rate +4%One of the features of the Income Rider is thatthe longer you wait to take withdrawals from theTotal Value Annuity, the more financial securityyou can build through the Stacking Roll-upthat increases the Income Benefit Base. Duringthe Stacking Roll-up Term, if you delay takingLifetime Annual Income, the Income BenefitBase will increase by the Stacking Roll-up. TheStacking Roll-up equals the weighted interestrates applied to your Account Value, if any, plus aguaranteed 4% stacked on top.For example, suppose you purchase yourcontract with $200,000, elect to purchase theIncome Rider and live in a state in which the8% bonus applies. Your Account Value and theIncome Benefit Base include the $16,000 dueto the bonus and equal $216,000. The IncomeBenefit Base would increase by the StackingRoll-up, the weighted interest rates applied toyour Account Value, if any, plus the guaranteed4% stacked on top.As a hypothetical example in the chartbelow, if your Account Value is allocated to theS&P 500 ® Index Account, and at the contractanniversary, the index account interest rate is3.0%, the Income Benefit Base would increase onyour first contract anniversary by the 3.0% plus theguaranteed 4% stacked on top, for a total of 7.0%.Using our example above, after the first year, theIncome Benefit Base would equal $232,200.On the 10-year contract anniversary, you willhave the option to renew the Stacking Roll-upfor an additional 10-year period if your attainedage is 80 or younger, for a total of 20 years, untilyou reach age 85 or begin taking Lifetime AnnualIncome. If you elect to renew the Stacking Rollup,we may increase the charge for the IncomeRider upon renewal.It is important to understand that both theTransparent Value Blended Index Account andthe 5 Year Annuity Linked TVI Index Accounthave five-year terms. No transfers to the FixedAccount or S&P 500 ® Annual Point to PointAccount from either the Transparent ValueBlended Index Account or the 5 Year AnnuityLinked TVI Account are permitted before theend of the five-year term. In addition, to receivethe full index interest from either of the five yearIndex Accounts, no withdrawals, deductions forrider charges or amounts for annuitization canbe taken from either five year Index Account.Any amount of a withdrawal, deduction for ridercharges or amount for annuitization taken fromeither five year Index Account after the firstanniversary of the start of the term, receives aninterim index credit that is based on a vestingpercentage.The Stacking Roll-up is not interestthat is credited to your Account Value.Initial Income Benefit Base Stacking Roll-up = 7.0% Contract AnniversaryIncome Benefit Base$216,000 $16,200 $232,2006 Security Benefit

Lifetime Withdrawal Rate up to 7.80%How much Lifetime Annual Income you receivedepends on a few factors:• The amount of your Income Benefit Base;• The age at which you begin taking LifetimeAnnual Income – the longer you wait to takeincome, the higher your Lifetime AnnualIncome can be 4 ;• Whether you want your income to last aslong as you live or as long as both you andyour spouse live;• Whether you take any withdrawals inaddition to the Lifetime Annual Income 5 .The amount of your Lifetime Annual Incomeis calculated by multiplying the Income BenefitBase by a Lifetime Withdrawal Rate. TheLifetime Withdrawal Rate is based on your ageat the time you begin taking Lifetime AnnualIncome. If you elect to receive Lifetime AnnualIncome for your and your spouse’s lives, theLifetime Withdrawal Rate is lower and is basedon the youngest life covered.For every year you delay taking the LifetimeAnnual Income, the Lifetime Withdrawal Rateincreases 0.10% per year, up to a maximum rateof 7.80% for single life and 7.10% for joint livesat age 90 or later. You will receive a predictableamount of income for the rest of your life, oryour and your spouse’s lives, as long as you onlytake withdrawals equal to the Lifetime AnnualIncome. (See the Lifetime Withdrawal Rateschedule on page 8.)4 Once you begin taking Lifetime Annual Income, the Lifetime Withdrawal Rate is locked in and never changes. The Stacking Roll-up tothe Income Benefit Base also stops. The earliest age to take the lifetime withdrawal is age 50. The Lifetime Annual Income is calculatedby multiplying the Income Benefit Base by the Lifetime Withdrawal Rate that applies for your age or the age of the youngest person ifincome payments are made to you and a spouse.5Withdrawals made prior to beginning Lifetime Annual Income and withdrawals that exceed the Lifetime Annual Income amount reducethe Income Benefit Base and the Lifetime Annual Income. These types of withdrawals will reduce future benefits under the Income Riderby more than the dollar amount of the withdrawals. In addition, during the surrender charge period, withdrawals may also be subject to amarket value adjustment (MVA), surrender charge and a bonus recapture if the withdrawal exceeds the free withdrawal amount under theannuity.7 Security Benefit

Lifetime Withdrawal RatesAge Single Life Joint Life50 3.80% 3.10%51 3.90% 3.20%52 4.00% 3.30%53 4.10% 3.40%54 4.20% 3.50%55 4.30% 3.60%56 4.40% 3.70%57 4.50% 3.80%58 4.60% 3.90%59 4.70% 4.00%60 4.80% 4.10%61 4.90% 4.20%62 5.00% 4.30%63 5.10% 4.40%64 5.20% 4.50%65 5.30% 4.60%66 5.40% 4.70%67 5.50% 4.80%68 5.60% 4.90%69 5.70% 5.00%Age Single Life Joint Life71 5.90% 5.20%72 6.00% 5.30%73 6.10% 5.40%74 6.20% 5.50%75 6.30% 5.60%76 6.40% 5.70%77 6.50% 5.80%78 6.60% 5.90%79 6.70% 6.00%80 6.80% 6.10%81 6.90% 6.20%82 7.00% 6.30%83 7.10% 6.40%84 7.20% 6.50%85 7.30% 6.60%86 7.40% 6.70%87 7.50% 6.80%88 7.60% 6.90%89 7.70% 7.00%90+ 7.80% 7.10%70 5.80% 5.10%The Income Rider 8

HOMEHEALTHCARE DOUBLERIf you become unable to perform at least two of the six basic activitiesof daily living (ADLs) after you purchase the Total Value Annuity, yourIncome Rider allows you to double the Lifetime Withdrawal Rate for up tofive years to help ease some of the financial burdens you may experienceduring this time. This important feature means you can take extra incomefor a time of need without affecting the amount of your Lifetime AnnualIncome after the five-year period.After the five-year period, the LifetimeWithdrawal Rate used to calculate LifetimeAnnual Income will revert to the originalLifetime Withdrawal Rate. (Not available inall states.)The six basic activities of daily living (ADLs) are:• Hygiene (bathing, grooming, shaving andoral care)• Continence• Dressing• Eating (the ability to feed oneself)• Toileting (the ability to use a restroom)• Transferring (actions such as going from aseated to standing position and getting inand out of bed)The benefit is only available if, at the timeyou purchase the Income Rider, you or, if youselect joint coverage, you and your spouse, canperform all of the ADLs. After you purchase theIncome Rider, you must wait two years beforeyou can request the Home Healthcare Doublerbenefit. You must request the Home HealthcareDoubler on forms provided by Security Benefit,and it must include a licensed doctor’s statementcertifying that you or your spouse cannotperform two or more of the six ADLs.9 Security Benefit

The Home Healthcare Doubler can only beused once and may not be available in all states.Please refer to the Statement of Understanding(SOU) for a complete listing of states in whichthe Home Healthcare Doubler is not available.An annual certification from a licenseddoctor is required to continue the benefits ofthis feature during the five-year period. Thisbenefit ceases on the fifth contract anniversaryafter the contract anniversary immediatelybefore your first request for the HomeHealthcare Doubler benefit, at which time theLifetime Withdrawal Rate reverts to the originalLifetime Withdrawal Rate.The Income Rider 10

AT A GLANCE – INCOMERIDER INFORMATIONRider purchaseThe Income Rider can only be purchased atcontract issue. The rider cannot be cancelled.Income Rider issue agesAges 50 – 80 (oldest owner, or annuitant if theowner is not a natural person)Income Benefit BaseThe Income Benefit Base is the amount usedto compute the Lifetime Annual Income andrider charge. It is not an amount that may bewithdrawn or annuitized and is not an amountpayable at death.Income Rider ChargeWhen you purchase your Total Value Annuitycontract, no product-related expenses arededucted from your Purchase Payments at thetime the application is received at SecurityBenefit. The total amount of your initial PurchasePayments is reflected in your issued contract. Theannual charge is 0.95% of the Income BenefitBase and is deducted from the Account Valueon each contract anniversary. The charge is alsodeducted upon payment of any amounts payableat death, a full surrender of the contract, or theAnnuity Start Date if the entire Account Valueis applied to an annuity option. The rider chargewill not increase during the first 10-year period ofthe contract. If you elect to renew the StackingRoll-up Term, the Income Rider Charge may beincreased, but will not exceed 1.80%. Refer tothe Statement of Understanding (SOU) for moreinformation.Additional purchase paymentsYou may make additional purchase payments atany time provided they are within the followingguidelines:• $1,000 minimum• Up to $1,000,000 total without priorapproval from Security Benefit LifeInsurance Company (SBL)WithdrawalsIt is important to note that withdrawals takenprior to taking Lifetime Annual Income, andwithdrawals in excess of your guaranteedLifetime Annual Income amount, may reduceyour guaranteed Lifetime Annual Income bymore than the dollar amount withdrawn. Ifyou take withdrawals in excess of the 10% freewithdrawal during the surrender charge period,your withdrawal may also be subject to surrendercharges, a bonus recapture and any market valueadjustment (MVA) that applies. Once Lifetime11 Security Benefit

Annual Income begins, withdrawals up to theLifetime Annual Income amount are not subjectto an MVA, surrender charge and a bonusrecapture, even if they are over the 10% freewithdrawallimit.Contract withdrawals and Lifetime AnnualIncome are subject to ordinary income taxand, if made before age 59½, may incur a10% IRS penalty tax. If Required MinimumDistributions (RMDs) are required, the LifetimeAnnual Income amount will be increased to theamount of the RMD, if higher. See the SOUfor a description of how withdrawals affect theLifetime Annual Income.Lifetime Income continuation upondeath of the ownerAt the time you select when you would likeLifetime Annual Income to begin, you also selectwhether the Income Rider is for you or for youand your spouse. (In the states that require it,you may select the Income Rider to be for youand your domestic or civil union partner. 6 ) ForLifetime Annual Income to continue for yourspouse’s lifetime, your spouse must be named asthe designated beneficiary or the Joint Owner ofyour annuity. If someone other than your spouseis the designated beneficiary or Joint Owner ofyour annuity, under the federal tax laws, uponyour death your annuity must terminate alongwith the Income Rider. In that event, LifetimeAnnual Income is no longer payable, and we willmake a payment on your death.6 A domestic or civil union partner is not currently viewed as a spouse under the federal tax laws.The Income Rider 12

This brochure contains highlights only and must be accompanied by the Security Benefit Total Value Annuity Base Productbrochure and Statement of Understanding (SOU). Please refer to the annuity contract for a full explanation of the productand any charges or limitations. The Guaranteed Lifetime Withdrawal Benefit Rider (Form 5720 (3-12) and ICC12 5720(3-12)) (Not approved in all states.), an optional rider available for purchase with the Security Benefit Total Value Annuity, isissued by Security Benefit Life Insurance Company. Product features, limitations and availability may vary by state.Guarantees provided by annuities are subject to the financial strength of the issuing insurance company. Annuities arenot FDIC or NCUA/NCUSIF insured; are not obligations or deposits of, and are not guaranteed or underwritten by any bank,savings and loan or credit union or its affiliates; are unrelated to and not a condition of the provision or term of any bankingservice or activity.S&P ® is a registered trademark of Standard & Poor’s Financial Services LLC (“S&P”) and Dow Jones ® is a registeredtrademark of Dow Jones Trademark Holdings LLC (“Dow Jones”). These trademarks have been licensed for use by S&PDow Jones Indices LLC. S&P ® and S&P 500 ® are trademarks of S&P and have been sublicensed for certain purposesby Security Benefit Life Insurance Company. The S&P 500 ® Index is a product of S&P Dow Jones Indices LLC and/orits affiliates and has been licensed for use by Security Benefit Life Insurance Company. The Security Benefit Total ValueAnnuity is not sponsored, endorsed, sold or promoted by S&P Dow Jones Indices LLC, Dow Jones, S&P or their respectiveaffiliates and neither S&P Dow Jones Indices LLC, Dow Jones, S&P or their respective affiliates make any representationregarding the advisability of purchasing such product.The Total Value Annuity and optional Income Rider should only be purchased if you have other sources of funds tomeet your immediate liquidity needs because a bonus recapture and surrender charge apply during the first 10 years andwill reduce the amount you receive. In addition, a market value adjustment may apply and may reduce the amount you canreceive. Please see the SOU for an explanation of the bonus recapture, surrender charge and market value adjustment.Fixed index annuities are not stock market or commodities investments and do not directly participate in any equity,bond, other securities or commodities investments. Market Indices do not include dividends paid on the underlyingstocks, and therefore do not reflect the total return of the underlying stocks; neither an index nor any fixed index annuity iscomparable to a direct investment in the equity, bond, other securities or commodities markets.Neither Security Benefit nor its representatives offer legal or tax advice. Please consult your personal attorney and/oradvisor regarding any legal or tax matters.TVI, TVI Index, Trader Vic Index, and EAM are trademarks of EAM Partners L.P. (“EAM”) and have been licensedfor use by Security Benefit Life Insurance Company. EAM created and owns rights to the methodology that is employed inconnection with the Trader Vic Index. The Annuity Linked TVI Index, ALTVI, RBS, The Royal Bank of Scotland and theDAISY device logo are trademarks of The Royal Bank of Scotland Group plc and The Royal Bank of Scotland plc (together,“RBS”) and have been licensed for use by Security Benefit Life Insurance Company. This product is not sponsored,endorsed, sold or promoted by either EAM or RBS, and neither EAM nor RBS make any representation regarding theadvisability of purchasing these products.Transparent Value Blended Index SM and Transparent Value Large Cap Defensive Index SM (the “Indexes”) are the propertyof Transparent Value, LLC, which has contracted with S&P Dow Jones Indices LLC or its affiliate (“S&PDJI”) to maintainand calculate the Indexes. The S&P 2-Year U.S. Treasury Note Futures Total Return Index is the property of S&PDJI and/ortheir third party licensors and has been licensed by S&PDJI for use by Transparent Value, LLC in connection with the Index.S&PDJI shall have no liability for any errors or omissions in calculating the Indexes.The Transparent Value Blended Index SM is a product, the marketing name and a trademark of Transparent Value, LLC.Transparent Value, Transparent Value Blended Index SM and Transparent Value Large-Cap Defensive Index SM are servicemarks of Transparent Value, LLC and have been licensed for use for certain purposes by Security Benefit Life InsuranceCompany. Transparent Value Blended Index SM and the Transparent Value Large-Cap Defensive Index SM are not sponsored,endorsed, sold or promoted by Transparent Value, LLC, or its respective affiliates, and Transparent Value, LLC and itsrespective affiliates make no representation regarding the advisability of purchasing such product.The Income Rider 14

The Security Benefit Total Value Annuity can help to secure yourretirement savings, create guaranteed income for life or help you providefor those you care about. We prepared this brochure and the companionTotal Value Annuity base product brochure, as well as the Total ValueAnnuity Death Benefit Rider brochure, to help you plan and prepare foryour financial needs in retirement.Inside, we cover the benefits and features of the Income Rider to better showhow this rider may complement the Total Value Annuity by providing alifetime annual income you can’t outlive.After reading the materials, you should know how the Total Value Annuity may:• Help you address retirement challenges you will likely face• Help you create your retirement income solution• Help you to provide for your spouse or beneficiariesTO AND THROUGH RETIREMENT800.888.2461One Security Benefit Place, Topeka, KS 66636-0001SecurityBenefit.comTVAI (3-12) IM-22301-01 2014/06/13