Investment account contractsInvestment account contracts

Investment account contracts

25. A benefit in respect of which all the following conditions are satisfied:

(a) the benefit is an investment account benefit;

(b) the benefit has the features mentioned in paragraph 15(2)(a) of the Act;

(c) the amount of the benefit is to be calculated according to a formula that:

(i) is set out in the policy document; and

(ii) includes an element that is dependent on, or to be ascertained according to, a decision of the life company;

(d) if the interest payable on the account is dependent on, or to be ascertained according to, a decision of the company:

(i) the benefit is provided for by a policy that belongs to a particular subcategory of life insurance business; and

(ii) no other kind of policy is contained within that subcategory; and

(iii) the net investment earnings (including realised and unrealised gains) of the assets administered for the purposes of that subcategory are credited to the policies belonging to that subcategory; and

(iv) the aggregate value of the accounts under the policies belonging to that subcategory does not, and will not at any time, exceed 103% of the value of the assets administered for the purposes of that subcategory; and

(v) the aggregate value of those accounts does not, and will not at any time, fall below 95% of the value of the assets administered for the purposes of that subcategory;

(e) if the charges payable under the policy are dependent on, or to be ascertained according to, a decision of the company, those charges as determined by or ascertained according to the decision of the company:

(i) are specified as a dollar amount, a percentage, or a combination of a dollar amount and a percentage; and

(ii) to the extent that the charges are specified as a dollar amount – do not exceed the charges, specified as a dollar amount, that applied when the policy was issued, increased in accordance with a formula or index relating to price variations that the company believes, on reasonable grounds, operates fairly and reasonably in the circumstances (for example, a consumer price index published by the Australian Bureau of Statistics); and

(iii) to the extent that the charges are specified as a percentage - do not exceed twice the specified percentage that applied when the policy was issued;

(f) the only elements of the formula mentioned in paragraph (c) that are dependent on, or to be ascertained according to, a decision of the company are one or more of the following:

(i) the interest payable on the account;

(ii) the charges payable under the policy;