Universal life insurance

 

Target client profiles: SunUniversalLife II may be ideal for individuals who have maximized their RRSP's and TFSAs, business owners looking to maintain the value of their business, and parents or grandparents who want to provide for children or grandchildren.

Selling features: SunUniversalLife II provides clients with permanent life insurance coverage to help meet their long-term personal, estate and business goals. Individuals can offset the tax liabilities of a growing estate, allowing more funds to go to their beneficiaries. Business owners can maximize business assets both before and after death. SunUniversalLife II helps to enhance financial security while protecting those who are most important.

Product overview

Product at a glance

Coverage options

 

  • Single life
  • Joint first-to-die, two lives - includes - includes Survivor benefit and Automatic survivor benefit
  • Joint last-to-die COI to second death, two lives
  • Joint last-to-die COI to first death, two lives
 

Issue limits

  • Minimum: $100,000
  • Face amounts of under $100,000 available if converting or exercising the full amount.
  • Maximum: $15,000,000 - contact your Sales Director for quotes greater than the maximum.
 

Death benefit options

  • Insurance amount plus policy fund
  • Level insurance amount
  • Level plus indexing
  • Level plus return of payments
  • Level plus adjusted cost basis (ACB)
 

Cost of insurance (COI) options and issue ages

COI    Single Joint

Level: 
Limited pay 10: 
Limited pay 15: 
Limited pay 20: 
YRT to age 85: 
YRT to age 70: 

18 - 85
0 - 85
0 - 85
0 - 80
0 - 70
0 - 55

18 - 85
18 - 85
18 - 85
18 - 80
18 - 70
18 - 55

For the Level plus death benefit options, the maximum single or joint issue age is age 70.

COI bands

  • $50,000 - $99,999 (conversion only)
  • $100,000 - $249,999
  • $250,000 - $499,999
  • $500,000 - $999,999
  • $1,000,000 - $4,999,999
  • $5,000,000 and up
 

Smoking status

Non-smoker, Smoker, or Blended

Surrender charges

Based on a percentage of the Target payment

  • Year 1: 100%
  • Year 2: 50%
  • Year 3: 0%

Target payment for non-rated cases is equal to100% of the level COI amount for all COI options

Policy fee

None

Guaranteed cash values

Available with the limited pay COI options beginning as early as the policy anniversary

Investment options

Guaranteed investment accounts

  • Daily interest account (DIA)
  • Guaranteed interest account (GIA)
  • 1,3, 5 and 10 year
  • Nineteen managed accounts including 7 that track the performance of select Sun Life Granite portfolios
  • Sun Life Diversified Account

Optional benefits

  • Accidental death benefit
  • Guaranteed insurability benefit
  • Total disability waiver benefit
  • Owner waiver benefit (death, disability or death and disability)
  • Child term benefit
  • Business value protection benefit
  • Term insurance benefit
  • T10, T10 with Renewal protection, T15, T20, T30

Special features

  • Access to the policy fund when disabled
  • Early death benefit
  • Living benefit
Advisor guides
Sample policy pages
Optional benefits

Term insurance benefit (TIB)

Issue ages: Base Life  Additional life
T10:   18 - 75  0 - 75
T10 with RPB:      18 - 65   0 - 65
T15:          18 - 70      0 - 70
T20:    18 - 65  0 - 65
T30:     18 - 55   0 - 55
  • Availability: Single life/Joint first-to-die/Joint last-to-die
  • Expires on the policy anniversary nearest the insured person's 85th birthday, or 85th birthday of the oldest insured
  • Minimum benefit amount: $50,000
  • Maximum benefit amount - Base life: $15,000,000 minus the basic insurance amount per insured
  • Maximum benefit amount - Additional life: $15,000,000 per insured
  • All or part of the TIB death benefit is convertible to permanent life insurance without additional medical evidence, up to the policy anniversary nearest the insured's 75th birthday
  • Available after issue, subject to underwriting requirements
  • Optional Renewal protection benefit (RBP)
    • Available with T10, allows the client to pay additional costs today in exchange for lower renewal costs, compared to T10 without RPB.
    • Cannot be cancelled or added after issue.

Accidental death benefit (ADB)

  • Issue ages: 0 - 65
  • Availability: Single Life/Joint first-to-die/Joint last-to-die
  • Minimum benefit amount: $10,000
  • Maximum benefit amount: Lesser of two times the insurance amount, including Term insurance benefits, and $1,000,000 ($250,000 for ages 0-17)
  • Expires at the policy anniversary nearest the insured person's 70th birthday
  • Costs are level and are payable until expiry of the benefit.
  • Can be added after issue at the policy anniversary only

Child term benefit (CTB)

  • Issue ages: 18 - 55
  • Availability: Single Life/Joint first-to-die/Joint last-to-die
  • Child eligibility: 0-18 based on age nearest birthday
  • Covers any child named on the application (born, adopted and stepchildren) and automatically covers children born or legally adopted after the date of application. Stepchildren may be added after issue through an application
  • Minimum benefit amount: $10,000
  • Maximum benefit amount: $30,000 total across all CTB coverages with Sun Life
  • Costs are payable to the earlier of 20 years and the policy anniversary nearest the insured person's 70th birthday
  • Benefit expires at the policy anniversary nearest the base insured person's 70th birthday 
  • Between the child's 18th and 25th birthdays, the owner will have the right to buy additional life insurance on the life of the child for up to 10 times the amount of the benefit
  • Can be added after issue at policy anniversary only

Total disability waiver benefit (TDB)

  • Issue ages:  0 - 55
  • Availability: Single Life/Joint first-to-die/Joint last-to-die
  • Expires at the policy anniversary nearest the insured person's 60th birthday
  • Benefit will waive up to $50,000 of annual premium/COI across all Sun Life policies
  • Costs will be waived as long as the insured is disabled
  • Cannot be added after issue

Owner waiver death benefit

  • Issue ages: 18 - 60
  • Availability: Single Life/Joint first-to-die/Joint last-to-die
  • The owner must be different than the insured.
  • Expires at the policy anniversary nearest the owner's 70th birthday
  • Benefit will waive up to $50,000 of annual premium/COI across all Sun Life policies
  • Costs will be waived as long as costs are charged for the insurance amount and optional benefits that exist in the policy at the time of death.
  • Not available when the Business value protection benefit has been selected
  • Cannot be added after issue

Owner waiver disability benefit

  • Issue ages: 18 - 55
  • Availability: Single Life/Joint first-to-die/Joint last-to-die
  • The owner must be different than the insured.
  • Expires at the policy anniversary nearest the owner's 60th birthday
  • Benefit will waive up to $50,000 of annual premium/COI across all Sun Life policies
  • Costs will be waived as long as the owner is disabled
  • Not available when the Business value protection benefit has been selected
  • Cannot be added after issue

Owner waiver death and disability benefit

  • Issue ages: 18 - 55
  • Availability: Single Life/Joint first-to-die/Joint last-to-die
  • This optional benefit combines the coverages provided by the Owner waiver death and Owner waiver disability benefits, at a discount when compared to their individual benefit premiums.

Guaranteed insurability benefit (GIB)

  • GIB allows policy owners to purchase additional life insurance for insured persons at their attained age without providing evidence of insurability.
  • Issue ages: 0 - 45
  • Availability: Single Life only
  • Minimum option amount:  $20,000
  • Maximum option amount:  Lesser of insurance amount (including Term insurance benefit and Enhanced insurance amount) and $300,000 across all Sun Life life insurance policies
  • Elections are available every 3 years and within 31 days of a special event (marriage, birth/legal adoption of a child)
  • A maximum of 8 elections up to a maximum face amount of $2,400,000 are available
  • Expires at the earlier of the policy anniversary nearest the insured person's 55 birthday or once the maximum amount of elections have been made
  • Not available if the Business value protection benefit has been selected
  • Not available after issue or for substandard risks

Business value protection benefit (BVPB)

  • Allows business owners to purchase additional insurance as their business grows without providing medical evidence
  • Issue ages: 18 - 60
  • Availability: Single Life only
  • Minimum option amount: $250,000
  • Maximum option amount: $2,500,000 across all Sun Life policies
  • Cumulative maximum equal to the lesser of $10,000,000 or 4 times the option amount
  • Options can be exercised annually within 31 days of the policy anniversary for the first 10 years
  • Expires at the earlier of the 10th policy anniversary or once the maximum amount of elections have been made
  • Not available if the Owner waiver or Guaranteed insurability benefits have been selected
  • Not available after issue or for substandard risks
Investment accounts

Administrative information

Transaction fees

The first four transactions per year, that are initiated by the policy owner are free. After that, the following transactions are charged $50 and must be paid up-front:

  •  investment account mix change
  •  COI withdrawal order change
  •  change in COI or death benefit option
  •  policy loan or cash withdrawal
  •  increases or decreases to the amount of insurance
  •  adding or deleting an optional benefit
  •  change to non-smoker rates
  •  rating changes
  •  change in Early death benefit percentage

The following changes are excluded from the four free transactions, and fees are required to be paid up front:

  •  $25 charge for any returned PAC payments
  •  $50 to reissue a replacement contract
  •  $50 for accounting history for two years and over

We may charge a fee for policy transactions or policy changes that are not listed. The maximum fee charged at any time is $50 per transaction.

Withdrawals

The minimum withdrawal amount is $250 and the maximum is the current policy cash surrender value (CSV) minus any guaranteed cash value (GCV) minus 12 times the previous month's total COI for the policy. Any withdrawal from the policy fund will reduce the death benefit by the amount of the withdrawal.

Policy loans

Cash loans

With SunUniversalLife II, loans against the policy fund are permitted after the first policy year. The minimum policy loan is $250. The maximum policy loan is determined using the following formula:

(75% X (A + B - C - D)) - E - (F X (1 + G)) where:
A = the policy fund value
B = any guaranteed cash value
C = any surrender charge
D = any MVAs
E = COI deductions for the insurance amount and optional benefits for the previous month X 12
F = any outstanding policy loans, including interest
G = the current loan interest rate, divided by 100
The death benefit paid is reduced by the amount of any outstanding policy loans, including interest.

The loan interest rate isn't guaranteed and is linked to the Royal Bank of Canada prime rate, plus 2%. The interest rate is set on the day of the policy loan. At each policy anniversary the interest rate is changed to the rate that would be charged for new policy loans on that day.

Automatic payment loans (APL)

APL is available for clients who have selected a limited pay COI coverage. If there isn't enough money in the policy fund to pay the cost of insurance when it's due, we'll process an automatic payment loan against any available guaranteed cash value. This loan is only available to pay the cost of insurance. The total amount of all policy loans plus accrued interest can't be more than the policy fund value plus any guaranteed cash value.

If the total amount of all policy loans plus accrued interest becomes greater than the policy fund value plus any guaranteed cash value, clients have 31 days to make any required payment or the policy will lapse.

Cash surrender value

The policy CSV is calculated as:

  • the policy fund value,
  •  minus surrender charges,
  •  minus any MVAs,
  •  minus policy loans including interest,
  •  plus any guaranteed cash value,
  •  plus any amount in the service account.
Qualifying as a non-smoker (juveniles)

Insured persons, age nearest 0 - 16 are classified as juveniles and receive a juvenile rate.

For ages 0 - 16 where a limited pay COI option has been selected, the juvenile rate applies for the duration of the coverage. Clients can't switch to non-smoker rates.

For ages 0 - 16 where the COI option isn't limited pay, a change from a juvenile rate to a non-smoker rate can be requested. The policy owner must submit a non-smoker declaration, signed by the insured person to Sun Life any time between the policy anniversary nearest the insured person's 17th and 19th birthdays. The change to non-smoker rates begins at the policy anniversary nearest the insured person's 18th birthday or the date the non-smoker declaration is approved - whichever is later.  If no declaration is received, the insured person is automatically classified as a smoker and is charged smoker rates from the policy anniversary nearest their 18th birthday. If the declaration is received after the policy anniversary nearest the 19th birthday new evidence of insurability is required.

Conversion options

Some convertible term plans or benefits can be converted (consult ABC or contact ServiceNow for details to determine eligibility), without evidence of insurability, to a SunUL II policy. If a term plan (with a conversion credit) is converted to a UL policy the credit will be transferred into the activity account. A permanent plan is not convertible to a SunUL II policy.

Living benefit

This benefit is offered on Sun Life Assurance Company of Canada life insurance products and is a non-contractual arrangement that we may approve at our discretion on a case-by-case basis. If an insured person is diagnosed with a terminal illness, an application can be made by the policy owner for a lump sum advance of 50% of the insurance amount, to a maximum of $250,000. The lump sum, plus interest, is deducted from the death benefit when paid. This benefit follows the rules of the living benefit program in effect when the policy owner applies to receive the benefit.

Client information