No Risk to Your Principal Premium payments, less any surrender charges, premium taxes, and applicable market value adjustment, are guaranteed by Clear Spring Life and Annuity Company, LLC (”Clear Spring LIfe”). Market Value Adjustment A Market Value Adjustment (MVA) will be applied any time a surrender charge is applied. The purpose of the MVA is, in case of an early withdrawal, to adjust the value of your funds for the change in interest rates. The change is measured by comparing the base interest rate credited in your contract, with the base interest rates being credited by the company on current sales of the same contract form. An upward change in base interest rates will cause a decrease in the value. A downward change in base interest rates will cause an increase in the value. The value of a negative adjustment for a 1% increase in interest rates will be the same as the value of a positive adjustment for a 1% decrease in interest rates. The benefit of having an MVA is that Clear Spring Life can offer a higher interest rate than it would offer if the contract did not contain an MVA provision. The MVA does not apply to penalty-free withdrawals, to the payment of a death benefit, or at the end of the guarantee period. Please refer to page seven of the contract for the MVA provision. It will apply to withdrawals that exceed the penalty-free withdrawal amount during a guarantee period. The MVA is not applicable in Delaware.
Surrender Charges
(All periods shown below may not be offered at all times.) A surrender charge applies to withdrawal amounts that are greater than the penalty-free withdrawal amount. Each guarantee period has its own surrender charge schedule. The amount of the surrender charge is a percentage of your account value, which generally decreases over time as shown in the chart below. If you renew into a new guarantee period, surrender charges will reset. Withdrawals before age 59½ may be subject to a 10% IRS penalty tax. See your agent or your legal or tax advisor for complete details.
1-Year Guarantee Period Year 2-Year Guarantee Period 3-Year Guarantee Period 4-Year Guarantee Period 5-Year Guarantee Period 6-Year Guarantee Period 7-Year Guarantee Period 8-Year Guarantee Period 9-Year Guarantee Period 10-Year Guarantee Period
1
2 3 4 5
6 7 8 9 10
7% 7% 7% 7% 7% 7% 7% 7% 7% 7%
6% 6% 6% 6% 6% 6% 6% 6% 6%
5% 5% 5% 5% 5% 5% 5% 5%
4% 4% 4% 4% 4% 4% 4%
3% 3% 3% 3% 3% 3%
2% 2% 2% 2% 2%
1% 1% 1% 1%
1% 1% 1%
1% 1% .75%
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