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Annuity Insurance for a Beautiful Life (Participating) Contract
Sino-US United MetLife Insurance Company Ltd. (hereinafter referred to as “We” “Us” or “Our”)
Reading Guide
This reading guide is intended help you to understand the insurance provisions to which the interpretation of the contents of the insurance contract shall be subject.
The important rights and interests to which you are entitled
You have the right to rescind the insurance contract
Within 10 days of our delivery of the insurance contract to you, you have the right to rescind the insurance contract and receive the premium you have paid in full ... Article 12
Your designated beneficiary is entitled to insurance benefits under the insurance contract ... Article 20
You have the right to apply for a policy loan ... Article 24
Matters to which you should pay particular attention to
We will not bear the insurance liabilities under certain special circumstances that have been marked in bold, please pay attention ... Article4, 9, 12, 13,14, 20 and 22
Rescission of an insurance contract will cause certain losses to you; please be prudent when you make such decisions ... Article 12
You should pay the insurance premiums on schedule ... Article 8
You have an obligation to make disclosure ... Article 13
You have an obligation to notify us of the occurrence of any insured event in a timely manner .... Article 4
Table of Contents
Part I General Provisions ... 3
Article I Components of the Insurance Contract ... 3
Article II Establishment and Effectiveness of the Insurance Contract ... 3
Article III Beneficiary ... 3
Article IV Notification of Occurrence of Insured Events ... 4
Article V Application for Payment of Insurance Benefit... 4
Article VI Payment of Insurance Benefit ... 5
Article VII Statute of Limitation ... 6
Article VIII Payment of the Premiums ... 6
Article IX Grace Period ... 6
Article X Reinstatement of Effect ... 6
Article XI Termination of Contract ... 6
Article XII Procedures and Risks of Rescinding the Contract ... 7
Article XIII Duty of Explanation and Disclosures ... 7
Article XIV Misstatement of Age or Gender ... 8
Article XV Change of Address ... 9
Article XVI Article 16 Revision of Insurance Contract ... 9
Article XVII Dispute Resolution ... 9
Article XVIII Applicable Law ... 9
Part II Special Provisions ... 9
Article XIX Qualified Insured ... 9
Article XX Insurance Liabilities ... 9
Article XXI Policy Dividends ... 11
Article XXII Exclusions ... 12
Article XXIII Insurance Period ... 12
Article XXIV Policy Loan... 12
Article XXV Automatic Advancement of Premiums ... 13
Article XXVI Settlement of the Arrears under the Insurance Policy ... 13
Article XXVII Disposal of Cash for Living ... 13
Part III Definitions ... 14
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Part I General Provisions
Article I Components of the Insurance Contract
1.1 This Annuity Insurance for a Beautiful Life (Participating) Contract (hereinafter referred to as the "Contract") is comprised of an insurance policy, a cash value statement, a statement of the basic sum insured of reduced paid-up insurance, terms and conditions of the insurance, an application form and other application documents in connection with this Contract, a valid statement, endorsements and other written agreements.
Article II Establishment and Effectiveness of the Insurance Contract
2.1 This Contract shall be established when we agree to approve the application by the applicant (hereinafter referred to as "You"). We shall deliver an insurance policy to you as an insurance certificate.
2.2 The effective date of this Contract shall be set forth in the insurance policy. Upon receipt of the first installment of premiums, we shall bear the insurance liabilities thereto as from midnight of the
effective date (see Definitions) of the insurance policy as stated on the insurance policy. The
policy anniversary (see Definitions), policy year, policy month and the agreed date for the payment of premiums shall be calculated based on the effective date of the insurance policy. If there is no such corresponding day in a month, the last day of the said month shall be used as the corresponding day.
Article III Beneficiary
3.1 You or the Insured may designate one or more beneficiary (beneficiaries) of the death benefit. 3.2 Unless otherwise agreed herein, the beneficiary of the annuity payouts, that of the insurance
benefit for living, that of the aged care benefit and that of the unearned insurance benefit is the Insured himself/herself.
3.3 In the event that there is more than one beneficiary, you may determine the sequence and the share of the insurance proceeds for the beneficiaries. If there is no stated share in proceeds, the beneficiaries shall enjoy beneficial rights in equal share.
3.4 If the Insured has no capacity or has limited capacity for civil conduct, his or her legal guardian may appoint the beneficiary.
3.5 You or the Insured may change the beneficiary (ies), and should notify us in writing of this change. Upon receipt of such notification, we will make an annotation on or attach an endorsement to the insurance policy or other insurance certificates.
3.6 You shall obtain the consent of the Insured when you appoint or change the beneficiary.
3.7 Upon the death of the Insured under one of the following circumstances, the said insurance benefit will be treated as the estate of the Insured and we may perform the obligation of paying the insurance benefit to the estate of the Insured in accordance with the Law of Succession of the People's Republic of China.
(1) There is no designated beneficiary, or when the beneficiary is ambiguously designated; (2) The designated beneficiary dies before the Insured and there is no other surviving
beneficiary; or
(3) The designated beneficiary loses his/her beneficial rights in accordance with the law or surrenders his/her beneficiary rights and there is no other beneficiary.
3.8 In the event that the beneficiary and the Insured die in the same accident, and the sequence of their death cannot be determined, the beneficiary shall be presumed to be the one who died first. 3.9 In the event that the beneficiary intentionally causes the death, disability or illness of the Insured,
or commits attempted murder of the Insured, the said beneficiary shall lose his/her beneficiary right to the benefit howsoever associated with this Contract.
Article IV Notification of Occurrence of Insured Events
4.1 You, the Insured, or the beneficiary shall notify us within 10 days after becoming aware of the occurrence of an insured event.
4.2 If you, the Insured, or the beneficiary fails to notify us of the occurrence of the insured event in a timely manner either intentionally or due to gross negligence, which leads to the result that the nature, cause and degree of damage cannot be identified, we shall not be obligated to pay the insurance benefit for the unidentified portion, unless we have already been aware of or should have been aware of the occurrence of the insured event in a timely manner via other methods, or the failure of timely notification does not affect the identification of the nature, cause and degree of damage of the insured event.
Article V Application for Payment of Insurance Benefit
5.1 The applicant of the death benefit shall be the beneficiary of the death benefit. When applying for payment of the death benefit, the applicant shall complete the Application Form for Payment of Insurance Benefit and provide the following certificates and documents:
(1) Insurance contract;
(2) Valid identity document (see Definitions) of the applicant;
(3) Death certificate of the Insured issued by a medical institution approved by the national health administration authority (see Definitions), the department of public security or other relevant institutions;
(4) Other certificates and documents which can be provided and are related to the identification of the nature, cause, etc. of the insured event;
(5) Proof that demonstrates the relationship between the applicant and the Insured (where necessary).
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5.2 The applicant of the annuity payouts, the insurance benefit for living, the aged care benefit and the unearned insurance benefit shall be the beneficiary of the annuity payouts, the insurance benefit for living, the aged care benefit and the unearned insurance benefit respectively. When applying for payment of such benefits, the applicant shall complete the Application Form for Payment of Insurance Benefit and provide the following certificates and documents:
(1) Insurance contract;
(2) Valid identity document of the applicant;
(3) The Insured's household register and valid identity documents;
(4) Proof that demonstrates the relationship between the applicant and the Insured (where necessary).
5.3 Where the insurance benefit is the estate of the Insured, the applicant shall provide the relevant entitlement documents demonstrating the applicant’s legitimate right to inheritance.
5.4 If the aforementioned proof and documents are incomplete, we will give the applicant a one-time notice in a timely manner, requesting him/her to provide us with additional evidence and documents.
5.5 We will review the originals of the aforementioned evidence and documents, except for the insurance contract. After completion of the review, we will retain photocopies of the originals and return the originals to the applicant or the agent.
Article VI Payment of Insurance Benefit
6.1 We shall make a claim assessment and determine whether we will make the payment or not in a timely manner upon receipt of the Application Form for Payment of Insurance Benefit and the proof and documents as agreed in the insurance contract. If the circumstance is complicated, we shall verify and make the decision within 30 days, unless otherwise agreed by the parties. For any event that falls within the scope of the insurance coverage, we shall fulfill our obligation of paying insurance benefits within 10 days after we enter into an agreement with the applicant regarding paying insurance benefit.
6.2 If we fail to fulfill the obligation specified in the preceding paragraph in a timely manner, then, in addition to the payment of insurance benefit, we shall compensate the applicant for any losses incurred thereby.
6.3 If an event does not fall within the scope of the insurance coverage, we shall, within 3 days after a claim assessment is made, issue to the applicant a notice of declining to pay the insurance benefit and reason thereof shall be given as well.
6.4 If the amount of the insurance benefit cannot be determined within 60 days after our receipt of the Application Form for Payment of Insurance Benefit and relevant proof and documents thereof, we shall pay the amount that can be determined by the proof and documents available. Once the final amount of the insurance benefit is determined, we shall pay the corresponding balance.
6.5 If the Insured appears after being declared deceased, the beneficiary of the death benefit should, within 30 days after he or she becomes aware of or should have become aware of the survival, return the insurance benefit already paid out by us.
Article VII Statute of Limitation
7.1 The statute of limitation for the applicant to request payment of the insurance benefit is 5 years, counted from the date when the applicant becomes aware of or should have become aware of the occurrence of the insured event.
Article VIII Payment of the Premiums
8.1 You may elect to use various modes of payment of premiums applicable to this Contract, which shall be indicated in the insurance policy.
8.2 If it is agreed that the premiums will be paid in installments, you should, upon payment of the first installment of premiums, pay the subsequent installments in accordance with the mode of payment as set forth in the insurance policy thereto and the agreed payment date.
Article IX Grace Period
9.1 Unless otherwise agreed herein, upon payment of the first installment of premiums, if you fail to pay a subsequent installment of the premiums when due, then you will be provided a 60 days grace period as from midnight of the agreed payment date, provided that the premiums will be paid in installments. We will undertake the insurance liabilities for any insured event which occurs within the grace period, but we will deduct the premiums owed by you from the insurance benefit when the latter is paid.
9.2 Unless otherwise agreed herein, if you still do not pay the premiums upon expiration of the grace period, the effect of this Contract shall be suspended as from midnight of the expiration date of the grace period.
Article X Reinstatement of Effect
10.1 Within 2 years upon suspension of the effect hereof, you may apply for the reinstatement of the same. With an agreement reached through consultation between you and us, the effect hereof shall be reinstated as from midnight of the date when the premiums are made up.
10.2 If no agreement is reached within 2 years from the suspension date of the effect hereof, we shall have the right to rescind this Contract. Where we rescind this Contract, we will return to you the
cash value (see Definitions) of this Contract at the time when the effect is suspended.
Article XI Termination of Contract
11.1 This Contract shall be terminated immediately under any of the following circumstances:
(1) You submit, as agreed, an application to us to terminate the Contract within the policy period;
(2) The effect of this Contract is suspended due to other circumstances as described in the terms hereof and no formalities for reinstatement of the effect have been gone through as
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agreed;
(3) Other circumstances as provided in law or as agreed in this Contract and its rider, which can lead to the termination of this Contract.
Article XII Procedures and Risks of Rescinding the Contract
12.1 If you apply for termination of this Contract, you shall complete an Application Form for termination of Contract and provide us with the following materials:
(1) Insurance contract;
(2) Your valid identity documents.
12.2 If you submit an application for rescission of this Contract within the Cooling off period (see Definitions), this Contract shall be terminated as soon as we receive the Form of Application for Termination of Contract, and we shall not bear any insurance liabilities from the effective date of this Contract, but we shall, within 30 days upon receipt of the Form of Application for Rescission of Contract, return, without interest, the premiums received.
12.3 If you apply for termination of the Contract after the cooling off period, this Contract shall be terminated when we receive the Application Form for Termination of Contract. We shall return the cash value of this Contract to you within 30 days upon receipt of the Application Form for Termination of Contract.
12.4 You will sustain losses if you terminate this Contract after the cooling off period.
Article XIII Duty of Explanation and Disclosures
13.1 At the time we enter into this Contract, we shall explain to you the contents of the Contract.
13.2 For those insurance clauses which exempt us from the insurance liabilities, we should, at the time we enter into this Contract, indicate them in the insurance application, insurance policies or other insurance certificates through obvious notes that can readily draw your attention, and make explicit written or verbal explanation of such clauses. When we fail to make such notes or explicit explanations, such clauses shall not be effective.
13.3 You shall make disclosure when we carry out an inquiry regarding the information about you and the Insured.
13.4 In the event that you fail to perform the obligation of making truthful disclosures as described in the preceding paragraph either intentionally or due to gross negligence and it would materially affect our decision as to whether or not to underwrite the insurance or increase the premium rate, we shall have the right to terminate this Contract.
13.5 If you intentionally fail to perform the obligation of making truthful disclosures, we shall neither bear the responsibility of paying the insurance benefit for the insured events before the rescission of this Contract, nor shall we refund you the premiums you have paid.
13.6 If you fail to perform the obligation of making truthful disclosures due to gross negligence that seriously affects the occurrence of an insured event, we shall not bear the responsibility of paying the insurance benefit for the insured events before the rescission of this Contract, but we shall refund you the premiums that you have paid.
13.7 In the event that, at the time of entering into the insurance contract with you, we are aware that you did not make truthful disclosure, we shall not rescind the insurance contract. Furthermore, if any insured event occurs, we shall undertake the obligation of paying the insurance benefit. 13.8 The right of rescission as described in this article shall lapse if we do not exercise such
right within 30 days after we become aware of the grounds for rescission. Two (2) years after the establishment of this Contract, we shall not rescind this Contract and if any insured event occurs thereafter, we shall assume the responsibility of paying the insurance benefit thereto.
Article XIV Misstatement of Age or Gender
14.1 When applying for the insurance herein, you shall fill in the date of birth and gender of the Insured consistent with those stated on the valid identity documents. The following provisions shall be applied should there be any errors:
14.1.1 If you misstate the Insured's age or gender, and his/her true and accurate age or gender is not in compliance with the restrictions under this Contract concerning the acceptable age or gender of the Insured for the insurance hereof, we shall have the right to rescind this Contract before any insured event occurs, and we will return to you the cash value of this Contract. The right of rescission as described in the preceding sentence shall lapse if we do not exercise such right within 30 days after we become aware of the grounds for rescission. Two (2) years after the establishment of this Contract, we shall not rescind this Contract and if any insured event occurs thereafter, we shall assume the responsibility for paying the insurance benefit thereto. In the event that, at the time of establishing the insurance contract with you, we are aware that you did not make truthful disclosures, we shall not rescind the insurance contract. Furthermore, if any insured event occurs, we shall undertake the obligation of paying the insurance benefit. 14.1.2 In the event that you misstate the age or gender of the Insured, thus underpaying the
premiums, we shall have the right to correct the misstatement and request you to pay the balance. If insured events have occurred, the insurance benefit shall be paid in proportion to the premium you have actually paid and the premium you should have paid.
14.1.3 In the event that you misstate the age or gender of the Insured, thus overpaying the premiums, we will refund you the difference between the actually paid premiums and the premiums payable.
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Article XV Change of Address
15.1 If your residential or mailing address changes, you should promptly notify us. Otherwise, all of our notifications for your attention will be sent to your last known residential or mailing address as stated on this Contract, and shall be deemed to have been delivered to you.
Article XVI Revision of Insurance Contract
16.1 During the policy period under this Contract, unless otherwise provided by law or agreed herein, the contents of this Contract may be revised upon our mutual agreement. In case of revision of the Contract, we shall make annotations on or attach endorsements to the original insurance policy or other insurance certificates, or conclude a written agreement with respect to the revision of the Contract.
Article XVII Dispute Resolution
17.1 If any dispute arises in the course of performing this Contract, the parties shall first settle the same through consultation. If no settlement can be reached through consultation, the dispute thereto shall, in accordance with the stipulations herein, be settled by the parties through either of the following solutions:
(1) Any dispute arising in the course of performing this Contract shall be settled by the parties through consultation. If no settlement can be reached through consultation, the parties shall submit the same to the arbitral body agreed by the parties for arbitration;
(2) Any dispute arising in the course of performing this Contract shall be settled by the parties through consultation. If no settlement can be reached through consultation, either party may bring a lawsuit to the court of law in accordance with the law;
Article XVIII Applicable Law
18.1 This Contract is governed by the laws of the People's Republic of China and any part herein conflicting with such laws shall be modified accordingly.
Part II Special Provisions
Article XIX Qualified Insured
19.1 You can apply for an insurance contract for a person (the "Insured") in whom you have insurable interest and who is at an age between 30 days to 60 years old.
19.2 You can apply for life insurance for your minor children. The total agreed amount of death benefit shall not exceed the limitation stipulated by the Chinese Insurance Regulatory Commission.
Article XX Insurance Liabilities
20.1 We shall assume the following insurance liabilities during the insurance period: 20.1.1 Annuity Payouts
If the Insured is alive during the policy period under this Contract, we shall, in the period from the first policy anniversary (inclusive of the first policy anniversary) to the first policy
anniversary after the Insured turns 88, pay the annuity in whichever one of the following ways you choose and in one of the amounts as provided below:
On an annual basis: we shall pay the annuity at each policy anniversary, the amount of which shall be the annual sum insured (see Article 20.2) for the year in question. On a monthly basis: we shall pay the annuity on a monthly basis, the amount of which shall be 8.4% of the annual sum insured for the year in question.
20.1.2 Insurance Benefit for Living
If the Insured is alive during the policy period under this Contract, and the ordinal number of the policy anniversary (see Definitions) in question can be divided by 10 without a remainder, we shall, in the period from the said policy anniversary to the first policy anniversary after the Insured turns 64, pay the insurance benefit for living, the amount of which shall be 200% of the basic sum insured stated on this Contract.
If the Insured is alive after the first policy anniversary after the Insured turns 65, and the ordinal number of the policy anniversary in question can be divided by 5 without a remainder, we shall, in the period from the said policy anniversary to the first policy anniversary after the Insured turns 88, pay the insurance benefit for living, the amount of which shall be 300% of the basic sum insured stated on this Contract. This Contract shall then be terminated.
20.1.3 Aged Care Benefit
If the Insured is alive after the first policy anniversary after the Insured turns 70, we shall, in the period from the said policy anniversary to the first policy anniversary after the Insured turns 88, pay the aged care benefit on an annual basis, the amount of which shall be 20% of the basic sum insured stated on this Contract. This Contract shall then be terminated. 20.1.4 Death Benefit
If the Insured dies during the insurance period under this Contract, we will pay the death benefit based on one of the following amounts, whichever is larger. This Contract shall then be terminated.
(1) 110% of the sum of the premiums as stated on this Contract and the Rider of Long-term Care Insurance and which have already been paid less the sum of the annuity, insurance benefit for living and aged care benefit which have been taken as of the time when the Insured dies;
(2) The sum of the cash value of this Contract and the Rider of the Long-term Care Insurance as of the time when the Insured dies.
20.1.5 Unearned Insurance Benefit
If the Insured survives the expiration of this Contract (i.e. the first policy anniversary after the Insured turns 88), we shall pay the unearned insurance benefit in an amount equal to 500% of the basic sum insured stated on this Contract. This Contract shall then be terminated.
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20.1.6 Waiver of Premiums for Total Disability
If you elect to pay the premiums in installments and the Insured becomes totally disabled
(see Definitions) during the insurance period under this Contract, with the disability confirmed by a qualified disability identification body (see Definitions), we will, in accordance with the stipulations herein, waive the premiums under this Contract from the payment date following the date when the Insured becomes totally disabled. The premiums waived shall be deemed to be paid, and this Contract shall remain in force. 20.2 Annual Sum Insured for the Year in Question
From the effective date of the insurance policy hereto, with respect to the first three policy years, the annual sum insured for the year in question shall be the basic sum insured stated on this Contract. With respect to the three subsequent policy years, the annual sum insured for the year in question will increase, with annual increments of 5% of the basic sum insured stated on this Contract.
20.3 Upon termination of this Contract or within the suspension period for the effect hereof, we shall not assume any responsibility for payment of the insurance benefit.
Article XXI Policy Dividends
21.1 This Contract constitutes a participating insurance contract, under which you have the right to participate in the distribution of earnings from our participating insurance business, but the dividends are non-guaranteed. Subject to the relevant provisions as set forth by the insurance regulatory and administration authority under the State Council, we will determine the amount of the dividends for the year in question in light of the actual operating condition0073 of our participating insurance business, and distribute your share of the dividends to you.
21.2 Where this Contract remains effective in a policy year, you will have the right to participate in the distribution of the dividends as agreed herein.
21.3 When taking out the insurance hereto, you may choose any of the following ways to receive the dividends as written on the application form:
(1) Taking cash;
(2) Accruing interest: meaning that you place the dividends in our custody, which will accrue interest at the cumulative interest rate for dividends in the form of the annual compound rate as determined by us on an annual basis and which will be paid by us in a lump sum, plus their interest, when this Contract is terminated;
21.4 If you do not select a way to receive the dividends, we will proceed in the second way as described in Article 21.3. You may change the way to receive your dividends in accordance with the provisions as set forth by us.
21.5 We shall, on an annual basis, provide the policy holder(s) with at least one bonus notice and we hereby undertake that the contents of such notice will be in compliance with the relevant provisions as set forth by the Insurance Regulatory and Administrative authorities of the State.
Article XXII Exclusions
22.1 Where the Insured dies of any of the following circumstances, we shall not be obligated to pay the death benefit:
22.1.1 You intentionally murder or injure the Insured;
22.1.2 The Insured intentionally commits crime(s) or defies legal criminal enforcement; 22.1.3 The Insured commits suicide within 2 years after the Contract becomes effective or
is reinstated, unless the Insured has no capacity for civil conduct when committing suicide;
22.1.4 The Insured voluntarily takes or injects drugs (see Definitions);
22.1.5 The Insured commits drunk driving (see Definitions), drives without a legitimate and valid driving license (see Definitions), or drives a motor vehicle which does not have a valid vehicle registration certificate (see Definitions);
22.1.6 War (see Definitions), military conflict, riot or armed rebellion; 22.1.7 Nuclear explosion, nuclear radiation or nuclear contamination.
22.2 Where the Insured becomes totally disabled due to any of the following circumstances, we shall not exempt you from paying the premiums:
22.2.1 The circumstances as described in Article 22.1 of this Contract, where the liabilities thereto are exempted;
22.2.2 The Insured commits self-mutilation or self-injury;
22.3 Upon the death of the Insured under the circumstances as described in Article 22.1.1, this Contract shall be terminated and we will return the cash value of this Contract to other obligors, provided that you have paid premiums for more than 2 years.
22.4 Upon the death of the Insured under any of the circumstances other than that as described in Article 22.1.1, this Contract shall be terminated and we will return to you the cash value of this Contract.
Article XXIII Insurance Period
23.1 The insurance period of this Contract shall be agreed upon between you and us during your application for the insurance and stated on the insurance policy.
Article XXIV Policy Loan
24.1 During the policy period under this Contract, should there be an accumulated cash value under this Contract, you may apply for a policy loan. The maximum amount of a policy loan shall be 90% of the net amount calculated by deducting the premiums automatically advanced and their accrued interests and other policy loans and their accrued interests from the cash value of this Contract. The term of each policy loan shall not exceed 12 months.
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24.2 We will adjust the interest rate for loans when appropriate. The interest rate for loans will float accordingly based on the interest rate for loans for the six month working capital loans released by the People's Bank of China. The contractual interest on a loan will be calculated based on the interest rate which will have been announced by us and will be used until the expiration of the term of the said loan.
24.3 In the event that all the policy loans and their accrued interests fall into arrears when they are due, and there is still sufficient cash value after all the automatically advanced premiums and their accrued interests, other policy loans and their accrued interests are deducted, the same will constitute a new principal of the policy loans and continue to accrue interest at the latest interest rate for policy loans released by us. If the cash value of this Contract is not enough to offset all the automatically advanced premiums plus their accrued interests and the policy loans plus their accrued interests, the effect of this Contract shall be suspended.
Article XXV Automatic Advancement of Premiums
25.1 If you have chosen this benefit, but you still do not pay the premiums under this Contract after the grace period expires, we will automatically give you credit for advancement of the then-current installment of the premiums, the interest rate for which will be the same as that for policy loans, provided that the balance to be calculated by deducting the policy loans owed by you and their accrued interests from the then-current cash value of your insurance contract is sufficient to advance the mature premiums thereto (including the premiums under the rider thereof).
25.2 Even if any insured event occurs during the advancement period, we will still undertake the insurance liabilities in accordance with the terms and conditions of this Contract.
25.3 If the balance to be calculated by deducting the policy loans and their accrued interests from the cash value of this Contract is not sufficient to advance the premiums payable and their interest, the effect of this Contract shall be suspended.
Article XXVI Settlement of the Arrears under the Insurance Policy
26.1 Before we pay the insurance benefits, or otherwise return to you the cash value of this Contract or the insurance premiums thereto, you shall settle all the premiums payable (including the automatically advanced premiums) and their accumulated interest and all the policy loans and their accumulated interest, otherwise we will deduct all the foregoing arrears and their interest payable from the insurance benefits that are about to be paid by us, or from the cash value of this Contract or the insurance premiums thereto that are about to be returned to you by us.
Article XXVII Disposal of Cash for Living
27.1 The cash for living under this Contract, including the annuity payouts, insurance benefit for living and aged care benefit, shall first be used to pay off the arrears under this Contract, including the premiums payable (including the automatically advanced premiums) and their accumulated interest and all the policy loans and their accumulated interest. The balance (if any) shall be disposed of in one of the ways chosen by us:
(1) Taking cash;
(2) Accruing interest: meaning that you place the cash for living in our custody, which will accrue interest at the cumulative interest rate in the form of the annual compound rate as determined by us on an annual basis. At the request of the Insured or when this Contract is terminated, we shall settle the cash for living in our custody and its interests by paying them in a lump sum to the beneficiaries of the annuity payouts, the insurance benefit for living and the aged care benefit. When the Insured dies, we shall settle the cash for living in our custody and its interests by paying them in a lump sum to the beneficiary of the death benefit.
27.2 If you do not select a way to receive the cash for living, we will proceed in the second way as described in Article 27.1.
Part III Definitions
Article XXVIII Definitions
28.1 Effective date of insurance policy: refers to the effective date for an insurance contract as set forth on an insurance policy. Unless otherwise agreed herein, the insurance policy hereto shall take effect at midnight of the effective date of the insurance policy.
28.2 Policy anniversary: refers to each anniversary corresponding to the effective date of the insurance policy.
28.3 Valid Identity Documents: include credentials and documents, etc. made and issued by the competent authorities in accordance with the provisions of the law, including resident identity card, household register, passport, military ID card, etc.
28.4 Medical institutions approved by the national health administration authority: refer to the public hospitals with qualification of over grade 2 (inclusive of grade 2), which are duly assessed and identified by the Ministry of Health of the People's Republic of China, excluding specialized psychiatric hospitals and medical institutions dedicated to deliver services for purposes other than directly performing medical treatment on patients, including rehabilitation, recuperation, drug rehabilitation, alcoholic rehabilitation, nursing care, senior care, etc. Such hospitals must be equipped with medical equipment which is in compliance with the relevant national rules for management of hospitals and set standards and have qualified doctors and nurses who are available to provide medical or nursing services within the hospitals 24 hours a day. We reserve the right to make adjustment to the definition of "Hospitals" provided that the hospital rating criteria established by the relevant national authority is changed or canceled.
28.5 Cash value: refers to the value an insurance policy has, usually embodied by the amount calculated pursuant to the actuarial principles and returned by us when an insurance contract is rescinded.
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28.6 Cooling off period: refers to the duration of ten days (inclusive of ten) after you have signed and received the insurance contract.
28.7 Ordinal number of the policy anniversary: the ordinal number of the policy anniversary of the first policy anniversary shall be 1, and that of the second policy anniversary shall be 2, and so on. 28.8 Total disability: refers to one or more of one of the following conditions:
I. Complete and permanent blindness in both eyes (Note 1)
II. Absence of both upper limbs above the wrist joints or both lower limbs above the ankle joints III. Absence of one upper limb above the wrist joint or one lower limb above the ankle joint IV. Complete and permanent blindness in one eye plus the absence of one upper limb above the
wrist joint
V. Complete and permanent blindness in one eye plus the absence of one lower limb above the ankle joint
VI. Complete and permanent disability of the joints in all four limbs (Note 2)
VII. Complete and permanent disability of the chewing or deglutition functions (Note 3)
VIII. The central nervous system or the functions of the organs in the chest or abdomen are extremely impeded or extremely disabled; the carrying out of any events, especially daily activities that sustain life, depends on nursing (Note 4)
Note:
1. Blindness may result from the absence or removal of the eyeball, being unable to perceive brightness or being merely able to identify the motion of a hand. The foremost corrected visual acuity here must be as poor as or lower than 0.02 or smaller than 5 degrees in the radius of view measured by a standard international test-chart, which must be administered by a certified ophthalmologist designated by the insurance company.
2. “Joint(s) become(s) disabled” refers to a joint that has become stiff or paralyzed or void of conscious motion.
3. “Chewing or deglutition becomes disabled” results from any organic or functional disorders other than those originating from the teeth wherein only a fluid diet is acceptable for the disabled.
4. Being extremely disabled, being unable to carry out any events, even daily activities without the dependence on nursing includes food intake, relieving nature from beginning to end, putting on/taking off clothes, going to bed/getting up, walking and having a bath.
5. The so-called “complete and permanent” refers to complete absence of function even after 180 days of therapy after the accident. However, removal of an eyeball, which is explicitly not restorable, is an exception.
28.9 Qualified disability identification bodies: refers to non-profit organizations which are set up by government sectors of the People's Republic of China and have the qualification to conduct disability identification, including institutes of forensic science, traffic accident identification organs, work-related injury and occupational disease identification organs and medical malpractice identification organs, but excluding medical service providing institutions such as hospitals. 28.10 Narcotics: refers to such items as opium, heroin, methamphetamine (ice), morphine, marijuana
and cocaine as prescribed in the Criminal Law of the People's Republic of China and other narcotic and psychotropic substances that can make people addicted to their use and are controlled under State regulations, excluding any prescription drugs containing poisonous substances for medical treatment.
28.11 Drunk driving: means, as shown in the results of detection or identification, the act of driving a motor vehicle when the insured event takes place provided that the driver's blood levels of alcohol (in mg/100ml) reach or exceed the legal limit. The traffic administration department of the competent public security organ shall be responsible for the identification of drink driving or driving while intoxicated in accordance with the provisions of the Law of the People's Republic of China on Road Traffic Safety.
28.12 Driving without a legitimate and valid driving license refers to any of the following circumstances: (1) The driver has not obtained a driving license;
(2) The driver drives a vehicle which is inconsistent with the type permitted as stated on the driving license;
(3) The driver drives a vehicle with a non-conforming driving license identified after examination and review by a competent traffic administration organ.
(4) When learning to drive, a learner driver drives without direction from his/her instructor, or without following the designated time and route.
28.13 Without a valid vehicle registration certificate refers to any of the following circumstances:
(1) The driver has no motor vehicle registration certificate, or the certificate has been canceled in accordance with the law；
(2) The vehicle has not been put under the technical inspection of motor vehicles in time in accordance with the law or has not passed the said technical inspection.
28.14 War: refers to any war waged or military action taken by a sovereign state in order to achieve its goal of economic or territorial expansion, or that in terms of nationalism, ethnicity, religion, or for other purposes.
