Permanent life insurance is sold to provide guaranteed protection over long periods of time (usually one's lifetime). It is used to provide, not only a sum of money to the insured's beneficiaries at death, but also an income stream to dependents, making it possible to maintain the quality of life they have come to enjoy. People also use permanent life insurance as a means of accumulating money through cash values for their own use in later life. This accumulation is referred to as a Living Benefit.

Ultimate Par offers permanent life insurance protection with guaranteed premiums, cash values and death benefits.

This policy may share in the Association's surplus through the payment of dividends. Dividends are based on the Association's year-by-year experience, and depend upon items such as the general level of interest rates, the amount and timing of benefit claims paid by the Association, and the Association's operating expenses. Dividends are not guaranteed and are subject to change by the Association.

Dividends increase the value of your life insurance policy in one of two ways:

• By increasing your policy's cash value and/or death benefit; or,
• By reducing the out-of-pocket cost of your policy.

You have options for the use of the dividends generated by the policy. These options include:

• Paid-up Additions: dividends are used to purchase additional insurance protection. This additional insurance has a cash surrender value and may generate its own dividends.
• Cash: sent to you each year in the form of a check.

A policy's cash value (Living Benefit) is guaranteed. It is the amount the policyholder will receive at any time if the policy is surrendered. It is, however, reduced by any outstanding loan balances. The policy has a loan provision which allows you to borrow against the cash value of your policy. Ninety-two percent of the cash value may be borrowed, subject to a loan interest rate of 8%. An automatic premium loan option is also available.

The flexibility of Ultimate Par is in the premium-paying period. When premiums are paid over the lifetime of the insured (whole life), the plan provides maximum level protection throughout the lifetime of the insured, at minimum premium rates. It affords good permanent protection, and generates cash values and other nonforfeiture benefits. Nonforfeiture benefits, such as Reduced Paid Up and Extended Term Insurance, are benefits which prevent a life insurance policy that builds a cash value from terminating for nonpayment of premiums.

This policy can be designed to allow premiums to be paid for shorter durations than the lifetime of the insured. A limited premium-paying period allows the policy owner to make payments during the period when earning power is high and relieving him or her of payments during later years when income may have decreased. The higher premiums for limited payment life plans are reflected in a more rapid increase of cash and nonforfeiture values.

A limited premium-paying policy is especially suited to a grandparent who wishes to provide a paid-up policy as a legacy to his/her grandchildren, or to an adult who wishes to create a paid-up policy prior to retirement, thereby eliminating premium obligations after retirement.