Class Plus 2 Information Folder and Contract Provisions - Empire Life

CLASS PLUS 2 – SINGLE TIERED INCOME NOW SCENARIORichard will be turning 65 this year. He has $400,000 insavings. He wants an equity-based investment that willguarantee him a fixed annual income with the potential fora future increase in income. The Class Plus 2 contract with aGuaranteed Withdrawal Benefit (“GWB”) offers the featuresto meet Richard’s objective.Under the GWB, the Lifetime Withdrawal Amount (“LWA”) isthe maximum amount guaranteed to be available each calendaryear for withdrawal for the life of the Annuitant provided theAnnuitant is 55 or older and an excess withdrawal doesnot occur.When the initial deposit is made the LWA is determinedbased on the amount of the deposit and a Single Tiered LWAPercentage. The Single Tiered LWA Percentage used is basedon the Annuitant’s age in the calendar year of deposit.On December 31st of each year the LWA is calculated for thefollowing year.If there have been no excess withdrawals during the year,the LWA for the following year will be the greater of:1) the current LWA: and2) a new LWA that is calculated based on the current IncomeBase* (after all transactions have been processed) and theSingle Tiered LWA Percentage that corresponds to theAnnuitant’s age in the next calendar year.If there have been excess withdrawals the LWA for thefollowing year will be an amount equal to the Single Tiered LWAPercentage of the current Income Base (after all transactionshave been processed). The Single Tiered LWA Percentage willbe determined based on the Annuitant’s age in the nextcalendar year.The current Single Tiered Percentages are as follows:Annuitant's AgeSingle Tiered LWA Percentage55 – 59 3.00%60 – 64 3.50%65 – 69 4.00%70 – 74 4.25%75 + 5.00%The initial Income Base will equal $400,000. Given that Richardwill be turning 65 in the current year, Richard’s age at the timeof the initial deposit is 65. Richard’s initial LWA will be $16,000($400,000 x 4.00%). Richard may withdraw up to $16,000in the current calendar year without incurring an excesswithdrawal. An excess withdrawal may significantly reduce oreliminate the value of the GWB.*Income Base is the notional value that is the basis for determining theLWA each calendar year.35