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					                                                     SECTION B



                                       PRODUCT SERIES OF SANLAM

                                               (in alphabetical order)
                                                                                                              Section
ACCIDENT COVER …………………………………………………………………….....                                                                  BR
ALSI 40 HIGHEST LEVEL LOCKER ……………………………………………………                                                              BL2
COLLECTIVE INVESTMENTS …………………………………...……………………...                                                              BQ
ESCALATING GUARANTEE INVESTMENT ………………………………………….                                                              BL1
HALALA SAVINGS PLAN .......................................................................................    BW
INTERNATIONAL ROLLING GUARANTEE INVESTMENT …………………………                                                          BL3
INVESTMENT PLANS …………………………………………………………………....                                                                  BK
LIFE ANNUITIES ……………………………………………………………………….....                                                                 BJ
MATRIX RISKCOVER …………………………………………………………………….                                                                    BZ
SANLAM TRUST ……………………………………………………………………….....                                                                   BU
STRATUS …………………………………………………………………………………..                                                                       BX
TERM ANNUITIES ………………………………………………………………………...                                                                   BJ
THE FUNERAL HELP PLANS A, B AND C ……………………………….....…….....                                                      BG
THE ONE POLICY FOR LIFE COVER ………………………………………………....                                                            BA
THE ONE POLICY FOR SPECIAL RISKS ...............................................................                BD
TOPAZ PERSONAL INVESTMENTS …………………………………………………..                                                                BV




GE 8/2006                                                     B
                           SECTION BA



                  THE ONE POLICY FOR LIFE COVER


                                                         Page
THE ONE POLICY FOR LIFE COVER ……………………………………………...       BA1
RIDER BENEFITS ……………………………………………..………………………              BA1
THE ONE POLICY FOR LIFE COVER AT A GLANCE ……………………….….   BA2




GE 10/2004                     BA
                                THE ONE POLICY FOR LIFE COVER


The One Policy for Life Cover is available only as part of a Capital Rentention Plan : Plan 24.

 Features          •   This product exclusively offers cover at a low rate. (Cash values are not the most
                       important consideration.)
                   •   The cover amount is high in proportion to the premium, therefore the cash values
                       are relatively low and it takes a long time for the breakthrough point to be reached.
                   •   Cover is guaranteed for the duration of the guarantee term.
                   •   The (most) policies reach a point where the cash value starts decreasing. A
                       revision may be necessary (see Section AB).
                   •   Benefits are payable only at the death of the life assured.
                   •   It is a universal policy (see Section AB).

 Term              For Life




                                           RIDER BENEFITS


The One Policy for Life Cover is available only as part of a Capital Retention Plan : Plan 24 for new
business. No rider benefits are available.




GE 8/2006                                            BA1
                 THE ONE POLICY FOR LIFE COVER AT A GLANCE
   The One policy for life cover : Stable Bonus Fund, Balanced Fund, Sanlam Equity
                                          Fund,
        Offshore Equity Fund and Multi-Manager Balanced Fund (High Equity)



        Minimum premium and           Minimum premiums/policy fees are revised annually
        policy fee                    and indicated in Section G (Summaries) only.
        Age at inception              Minimum      :     15 anb
                                      Maximum      :     80 anb
        Cover levels available        Maximum
        Waiting period                One month
        Death benefit is the larger   – Single Premium
        of
                                      – Balance of the investment account
                                      – Cover amount
        Policy/benefit term           For life

                      Note: Only available as part of a Capital Retention Plan : Plan 24.




GE 2/2005                                          BA2
                                                          SECTION BD


                                      THE ONE POLICY FOR SPECIAL RISKS



                                                                                                                           Page
DESCRIPTION ....................................................................................................           BD1
INVESTMENT FUND ...........................................................................................                BD1
REMUNERATION ................................................................................................              BD1
TERM ...................................................................................................................   BD1
GUARANTEES ....................................................................................................            BD1
LIFE INSURED ....................................................................................................          BD1
POLICYHOLDER .................................................................................................             BD1
PREMIUMS ..........................................................................................................        BD1
PREMIUM GROWTH ...........................................................................................                 BD2
COVER GROWTH ..............................................................................................                BD2
DEATH BENEFITS .............................................................................................               BD2
RIDER BENEFITS ...............................................................................................             BD2
AGE AT INCEPTION ...........................................................................................               BD2
WAITING PERIOD ...............................................................................................             BD2
SURRENDERS ....................................................................................................            BD2
LOANS ................................................................................................................     BD2
SWITCHES ..........................................................................................................        BD2
ALTERATIONS ....................................................................................................           BD2
INFORMATION BROCHURE ..............................................................................                        BD3
UNDERWRITING .................................................................................................             BD3
CLAIMS PROCEDURE ........................................................................................                  BD3
SESSIONS ...........................................................................................................       BD3
BENEFICIARIES .................................................................................................            BD3
NOMINEE FOR POLICY-OWNERSHIP ..............................................................                                BD3
ADMINISTRATIVE INFORMATION .....................................................................                           BD3




GE 2/2002                                                           BD
                              THE ONE POLICY FOR SPECIAL RISKS



    DESCRIPTION

The One Policy for Special Risks is an endowment with life cover, designed for persons who do not
qualify for life cover in terms of ordinary policies. This usually includes those who have an uninsurable
disease, including HIV.

Sanlam Life will rate each life individually, taking into account the relevant insured's life expectancy.

    INVESTMENT FUND

This product is available only in the Stable Bonus Fund.


    REMUNERATION

Twenty five percent of normal broker scale commission, paid up front over two years and clawed back in
line with the Insurance Act.

    TERM

The term is always 10 years.

    GUARANTEES

The guarantee term is always equal to the policy term of 10 years. However, there is no guaranteed
amount at maturity.

    LIFE INSURED

Only one life insured is permitted.


    POLICYHOLDER

Only an individual may be the policyholder.

    PREMIUMS

•   Only recurring premiums are available.
•   Level premiums must be paid throughout the policy term.
•   Minimum premium : R100,00 p.m.
•   Frequency            : Monthly, quarterly, half-yearly and annually.
•   Mode of payment : Debit order only. Debit order discount applies.
•   Premiums are determined by
    −   the life insured's age at entry
    −   the cover required
    −   individual underwriting of risk.




GE 2/2002                                           BD1
    PREMIUM GROWTH

No premium growth will be allowed.


    COVER GROWTH

Cover growth will not be available.

    DEATH BENEFITS

    Minimum      : R10 000
    Maximum      : R100 000


    RIDER BENEFITS

No rider benefits (including Indexplan) are available with this product.

    AGE AT INCEPTION

    Minimum      : 15 next birthday
    Maximum      : 60 next birthday


    WAITING PERIOD

The waiting period for surrenders is 18 months.

    SURRENDERS

Surrender values will be available after the waiting period has expired. The normal restricted period of
five years applies.

    LOANS

The policyholder may borrow against his policy after the waiting period has expired and if the policy has
a sufficient cash value.

    SWITCHES

No switches will be allowed as only the Stable Bonus Fund is available.


    ALTERATIONS

•    The policy can be made paid-up if it has a positive cash value.
•    The death benefit amount may be reduced or increased within the minimum and maximum amounts
     allowed.
•    Cash withdrawals may take place. (The premium and cover will be reduced accordingly.)




GE 2/2002                                           BD2
  INFORMATION BROCHURE

An information brochure is available from:
    • New Business: Training; or
    • Advisers' and Brokers' Web.
Intermediaries must hand this brochure to the client, together with the proposal form.

  UNDERWRITING

Full medical underwriting takes place, so that Sanlam Life can be sure that the premiums make
provision for the risk. Normal underwriting for occupation, part-time activities, etc. also takes place.


  CLAIMS PROCEDURE

The usual procedure is followed in the case of a death claim. Standard exclusions (for example suicide
within 24 months) apply.

The normal procedure should also be followed for maturity claims.


  CESSIONS

These policies can be ceded to individuals or institutions.

  BENEFICIARIES

The policyholder may appoint any number of beneficiaries to receive the death benefit at the death of
the life insured.

 NOMINEE FOR POLICY-OWNERSHIP

If the policyholder and the life insured are two different people, the policyholder may nominate one
person to become the new policyholder at his or her death.


 ADMINISTRATIVE INFORMATION

NB: This special product must be handled separately from the normal BPR or ANB -process.
    For full details of the process, consult the NUB Legacy Administrative Guide on Notes.

 Proposal form             AEB40
 Product name code         J002
 Table Code                T303
 Quotations                No SanQuote quotations are available.
                           Underwriters: Fax (021) 947-4806
 Enquiries                 Product enquiries       Sanlam Personal Finance : Client Solutions : Product
                                                   Support - tel. (021) 916-3082
                           Commission              Distribution:                         (021) 947-5002
                           enquiries               Commission Support




GE 8/2006                                          BD3
                                                             SECTION BG


                                                 THE FUNERAL HELP PLAN



                                                                                                                            Page
PLAN A …………………………………………............……………………………..                                                                            BG1
PLAN B ...............................................................................................................      BG1
PLAN C ................................................................................................................     BG1
GENERAL INFORMATION …………………………………………………………..                                                                                BG2
 – TABLE CODES ……………….………………………………….………………..                                                                                BG2
   –   PRODUCT NAME CODES .......................................................................................           BG2
   –   REMUNERATION .....................................................................................................   BG2
   –   MINIMUM AGE AT ENTRY ………………………………………………………………                                                                        BG3
   –   MAXIMUM AGE AT ENTRY .....................................................................................           BG3
   –   BENEFIT TERM ……………………………………………………………………………                                                                           BG3
PREMIUMS: PLANS A AND B ………………………………………….….……….                                                                             BG4
PREMIUMS: PLAN C .........................................................................................                  BG4
DEATH BENEFIT: PLANS A AND B ………………………………….…………...                                                                          BG5
   –   ASSUREDS ………………………………………………………………………………..                                                                            BG5
   –   COMMENCEMENT OF COVER …………………………………………………………                                                                         BG6
   – DEATH BENEFIT AMOUNTS ………………………………………………………                                                                            BG6

DEATH BENEFIT: PLAN C .................................................................................                     BG7
   –   ASSUREDS ………………………………………………………………………………..                                                                            BG7
   –   COMMENCEMENT OF COVER ...............................................................................                BG8
   –   DEATH BENEFIT AMOUNTS ...................................................................................            BG9
RIDER BENEFITS AVAILABLE ……………………………………………………..                                                                             BG11
   –   WAIVER OF PREMIUM BENEFIT (PB) ………………………………………………...                                                                 BG11
   –   INDEXPLAN ……………………………………………………………………….……….                                                                           BG11
   –   FUNERAL TRANSPORT BENEFIT ……………………………………………………..                                                                     BG12
UNDERWRITING REQUIREMENTS ………………………………………………..                                                                              BG13
   –   RATE DIFFERENTIATION ……………………………………………………………….                                                                       BG13
   –   NEW PROPOSAL (BASIC POLICY) …………………………………………..………..                                                                  BG13
   –   WAIVER OF PREMIUM BENEFIT (PB) ………………………………………………...                                                                 BG13
   –   ADDING ASSUREDS TO AN EXISTING POLICY …………………………………….                                                                BG13
AIDS COVER …………………………………………………………………………..                                                                                   BG13
POLICY VALUE ……………………………………………………………………….                                                                                   BG14
   –   CASH VALUE ………………………………………………………………………………                                                                            BG14
   –   LOAN VALUE ………………………………………………………………………………                                                                            BG14
   – FULLY PAID-UP VALUE …………………………………………………………..                                                                           BG14

NOTATIONS .......................................................................................................           BG14
TAX ……………………………………………………………………………………...                                                                                     BG14




                                                                                                                            2/...
GE 2/2002                                                              BG
                                    -2-
                                                                   Page
POLICY OWNERSHIP ………………………………………………………………..                        BG15
  –   NOMINATION OF BENEFICIARY(IES) AND NOMINEE(S)…………………………...   BG15
  –   CESSIONS …………………………………………………………………………………                     BG15
IDENTIFICATION POLICY …………………………………………………………..                     BG16
CLAIMS PROCEDURES ……………………………………………………………..                        BG17
 – DEATH BENEFIT ………………………………………………………………….                        BG17

REVISIONS …………………………………………………………………………….                           BG18
PROOF-FREE OPTION ……………………………..………………………………..                      BG18




GE 2/2002                             BG
                                     THE FUNERAL HELP PLAN


The Funeral Help Plan will ensure cover in the event of the death of a family member. As different
market segments have different needs in respect of affordability and cover required, three Plans are
available:


    PLAN A

•   The policy provides cover up to age 65 next birthday for all assureds (except to children).
•   Covers a principal assured and up to three children.
•   Three levels of cover available: R4 000, R6 000 and R9 000.
•   Monthly debit order premium ranges from R31,50 to R90,00 depending on the level of cover chosen
    and the age of the principal assured.
•   An abbreviated declaration of health is required and cover for Aids is always included.
•   When a child’s death cover terminates, he/she can take out additional assurance up to a
    maximum of R30 000 within 3 months, without proof of health. An HIV blood test is required and if it
    is HIV positive, the option will be denied.
•   Premiums increase at a fixed rate of 8% annually. Cover also increases at a rate determined by
    Sanlam Life every year. At present it is 60% of the premium growth rate.


    PLAN B

•   The policy provides cover up to age 65 next birthday for all assureds (except to children).
•   Covers a principal assured, a spouse and up to three children.
•   Three levels of cover available: R4 000, R6 000 and R9 000.
•   Monthly debit order premium ranges from R44,50 to R112,50 depending on the level of cover
    chosen and the age of the principal assured.
•   An abbreviated declaration of health is required and cover for Aids is always included.
•   When a child’s death cover terminates, he/she can take out additional assurance up to a
    maximum of R30 000 within 3 months, without proof of health. An HIV blood test is required and if it
    is HIV positive, the option will be denied.
•   Premiums increase at a fixed rate of 8% annually. Cover also increases at a rate determined by
    Sanlam Life every year. At present it is 60% of the premium growth rate.

    PLAN C

•   The basic policy offers death cover to the following:
    − The principal assured (male or female).
    − A spouse.
    − The principal assured’s two parents and two parents-in-law (maximum of 4 persons).
    − The principal assured’s dependent children (maximum of 10 persons).
    − Three other persons who is financially dependent on the principal assured.
    A maximum of 17 members per policy is allowed, and 19 at notations. Should an institution, e.g. a
    bank, be the policy-owner, only one insured member is permitted on the policy.
•   The policy provides cover for life to all assureds (except to children).
•   An abbreviated declaration of health is required and cover for Aids is always included (except for
    waiver of premium in respect of the principal life assured).
•   A waiver of premium benefit for the principal life assured is available (subject to full underwriting).
    With the waiver of premium benefit, the premiums of all other lives assured will be waived when
    the principal assured dies (new principal assured excluded).
•   When a child’s death cover terminates, he/she can take out additional assurance up to a
    maximum of R30 000 within 3 months, without proof of health. An HIV blood test is required and if it
    is HIV positive, the option will be denied.
•   Premiums increase at a rate equal to the CPI annually. Cover also increases at a rate determined
    by Sanlam Life every year. At present it is 70% of premium growth rate.




GE 6/2005                                             BG1
                                      GENERAL INFORMATION



    TABLE CODES

·    Funeral Help Plan A: Table 65
·    Funeral Help Plan B: Table 65
·    Funeral Help Plan C: Table 69


    PRODUCT NAME CODES

·    Funeral Help Plan A: H005
·    Funeral Help Plan B: H006
·    Funeral Help Plan C: H007

    REMUNERATION

Annual remuneration will be paid at the following scales:

·    25% x 11,4 x the first year’s monthly stop order premium in year 1, and
                                           nd   rd   th
·    10% x 11,4 x that specific year’s (i.e. 2 , 3 , 4 etc.) monthly stop order premium thereafter.

CLAW BACK POLICY

If a policy should lapse during the first two policy years, the non-vested part of the first year's
commission payment will be clawed back.

For commission paid in the second and subsequent years there will be no claw back. There is also no
claw back in the event of death of an assured.




GE 8/2004                                                 BG2
MINIMUM AGE AT ENTRY

                                              Plan A               Plan B               Plan C
Basic policy
•    Principal assured                        18 anb               18 anb               18 anb
•    Spouse                                     n.a.               18 anb               18 anb
•    Parents/Parents-in-law                Not applicable       Not applicable          25 anb
•    Dependent children                        1 anb                1 anb               1 anb
•    Another dependant                     Not applicable       Not applicable          1 anb

Waiver of premium benefit (PB)
Principal assured                          Not applicable       Not applicable          18 anb

MAXIMUM AGE AT ENTRY

                                              Plan A               Plan B               Plan C
Basic policy
•    Principal assured                        60 anb               60 anb               65 anb
•    Spouse                                     n.a.               60 anb               65 anb
•    Parents/Parents-in-law                Not applicable       Not applicable          80 anb
•    Dependent children                       20 anb               20 anb               24 anb
•    Another dependant                     Not applicable       Not applicable          65 anb

Waiver of premium benefit (PB)
Principal assured                          Not applicable       Not applicable          65 anb

    BENEFIT TERM

                                              Plan A               Plan B               Plan C
Basic policy
Dependent Children                          Until 21 anb         Until 21 anb        Until 25 anb
All other assureds                          Until 65 anb      Until 65 anb of the      For life
                                                               younger of the
                                                              principal assured
                                                                 and spouse

Waiver of premium benefit (PB)             Not applicable       Not applicable          For life


Note:     - Cover expires on the policy anniversary the policyholder reaches the age as indicated.
          - Whenever a policy changes from a Plan A to Plan B or vice versa the term may have to be
            adjusted.




GE 11/2003                                        BG3
                                      PREMIUMS: PLANS A AND B


The premium is charged per family and is independent of the number of children (maximum 3) on the
policy. Premiums depend on the following:

•    The chosen level of cover (only 3 levels of cover are available),
•    the plan chosen (A or B), and
•    the age of the principal assured.

The following table gives the monthly debit order premiums:

                                        PLAN A                                      PLAN B
       COVER
      AMOUNT                Age next               Age next              Age next              Age next
                        birthday 18 - 50       birthday 51 - 60      birthday 18 - 50      birthday 51 - 60
        4 000                R31,50                R40,50                 R44,50               R 52,50
        6 000                R45,00                R60,50                 R63,50               R 77,50
        9 000                R62,50                R90,00                 R91,00               R112,50


Payments by debit and stop order will be allowed.

    PREMIUM DECREASE
In the case of a Plan B the premium will be reduced to the associated Plan A premium if either the
principal assured or the spouse dies. The premium will not be reduced when cover ceases for any child
(on reaching age 21 next birthday).

NON PAYMENT OF PREMIUMS

If more than two monthly premiums become due, the policy will lapse.




                                         PREMIUMS: PLAN C




    PREMIUM PAYMENT TERM
•    The policy offers a whole-life premium term till the death of all assureds (children to 25 anb).
•    If the waiver of premium benefit becomes operative, all further premium payments are discontinued.
     After the death of the principal assured the death benefits of the remaining assureds stay constant.

    PREMIUM DECREASE

If any one of the assureds dies, or if the cover for dependent children expires (25 anb), the amount of
the premium is reduced by the sum of that specific assured’s premium and the policy continues
unchanged.




GE 2/2005                                              BG4
                                   DEATH BENEFIT: PLAN A AND B



    ASSUREDS

PRINCIPAL ASSURED
•    The older person of the two adults will be the principal assured for a Plan B policy.
•    Sanlam Life will not remove a principal assured on request.
•    Whenever the policy is changed from a Plan A policy to a Plan B policy (by adding a spouse), the
     existing principal assured will remain the principal assured.

•    If the principal assured dies:
     −   In the case of a Plan A policy, the policy ceases.
     −   At the death of the principal assured (or spouse) a Plan B policy, the policy automatically
         becomes a Plan A policy with its associated reduced premium. If the remaining assured
         (spouse) does not want to continue with the policy, he/she must inform Sanlam Life that the
         policy must be cancelled.

•    If the principal assured reaches age 65 next birthday:
     − In the case of a Plan A policy, the policy ceases.
     − In the case of a Plan B policy, the cover in respect of the principal assured (or spouse) ceases
       and the policy is automatically changed to a Plan A policy with its associated reduced premium.


SPOUSE
•    A spouse can be added to a Plan A policy at any stage. The policy automatically becomes a Plan B
     policy with its associated increased premium.
•    A spouse can be removed from a Plan B policy at any stage. The policy automatically becomes a
     Plan A policy with its associated reduced premium.
•    A spouse is a person
     − Of the opposite sex
     − to whom the principal assured is legally married on the date of inclusion as an assured, or
     − with whom the principal assured has concluded an agreement recognised as a marriage in
       accordance with any law or custom, provided that the principal assured has satisfied Sanlam Life
       in the case of a marriage by law or custom, that he/she lives with the other party as if they were
       legally married.
•    Only one spouse per policy is permitted.




GE 11/2003                                             BG5
CHILDREN
•    A dependent child is any child, including an adopted child or a step-child, who at the date of
     becoming an assured on the policy is
     −   younger than 20 years, and is
     −   financially dependent on the principal assured for support (including where the obligation for
         support has been established owing to customary or indigenous law).
•    Own, legally adopted or step-children may be added to the policy only if the maximum of three
     children has not yet been reached.
•    Baby Benefit:
     −   The child of a female principal assured or female spouse enjoys free cover for the first 6
         months after birth (even if the child was not added to the policy as an assured).
     −   a Baby Benefit amount of R1 000 is payable at the death of a baby
         −   after the 28th week of pregnancy, or
         −   within 6 months of birth, provided the birth has been registered.
     −   When three children are added as assureds on the policy, no more babies will be covered on
         that policy in terms of the Baby Benefit. However, if one or more of the children is removed, the
         Baby Benefit will again be available for newly born babies.
•    A maximum of 6 claims (i.e. “recognised” claims) will be allowed in total for children on a Plan A or B
     policy in terms of the Baby Benefit and the Death Benefit.
•    If new children (babies, legally adopted or step children) are added onto the policy, or children is
     taken off the policy (because they reached age 21 next birthday) or if they are taken off voluntarily,
     the premium will not be adjusted.


    COMMENCEMENT OF COVER

•    Principal assured, spouse and children
     The first premium is payable on the policy commencement date. Sanlam Life’s obligations in terms
     of this policy take effect only after the first premium is paid.
•    Waiting periods for principal assured, spouse and children
     − Natural death or suicide: A waiting period of 6 months applies from commencement of cover
       before a claim is admitted.
     − Non-natural death: No waiting period applies.
     − There is no waiting period for children added to the policy at NUB stage. For children added to
       the policy after it has been issued, a waiting period of 6 month applies.
     −   If the cover is increased after the inception date, the same waiting period that applied on the
         inception date will apply for the amount by which the cover is increased.

    DEATH BENEFIT AMOUNTS
•    Three levels of cover are available: R4 000, R6 000 and R9 000.
•    The principal assured and the spouse have the same level of death cover.
•    The cover in respect of each of the children is 50% of that of the principal assured. The cover
     amount for children younger than 6 years will further be limited to 25% of that of the principal
     assured.
•    Cover levels cannot be changed after inception of the policy.




GE 10/2004                                             BG6
                                       DEATH BENEFIT: PLAN C



    ASSUREDS

PRINCIPAL ASSURED
•   A principal assured must be nominated by the policy-owner (proposer).
•   All additional assureds must be related to the principal assured.
If the principal assured dies, the following will apply:

Policies with waiver of premium benefits
•   If the principal assured dies, a new principal assured is not appointed.
•   No new assureds can be added to the policy after the death of the principal assured.

Policies without waiver of premium benefits
If the principal assured dies, a new principal assured can be appointed.

•   If a new principal assured is added:
    − The policy-owner (proposer) can add any other person as a principal assured to the policy
      irrespective of his/her relationship to any of the existing assureds.
    −   All new assureds who are subsequently added must be related to the new principal assured.
•   If no new principal assured is added to the policy:
    − All new assureds who are added thereafter must be related to the spouse.
    − If there is no principal assured or spouse, no new assureds can be added to the policy until a new
      principal assured has been appointed.


SPOUSE
•   A spouse can be added to or altered on a policy at any stage.
•   A spouse is a person
    − to whom the principal assured is legally married, or
    − with whom the principal assured has a relationship that is regarded as a marriage according to
      any law or custom, provided that the principal assured must satisfy Sanlam Life that he/she lives
      with the other party as if they were legally married.
•   Only one spouse per policy is permitted. A second spouse and further spouses can be added to the
    policy as “other dependants”.




GE 10/2004                                                 BG7
PARENTS AND PARENTS-IN-LAW
A parent is the natural parent, foster or step-parent, who was responsible for the upbringing of the
principal assured or spouse. A maximum of two parents and two parents-in-law can be assured.

CHILDREN
A dependent child is any child including an adopted child, step-child or illegitimate child, who at the date
of becoming an assured on the policy is
     •   younger than 24 years;
     •financial dependent on the principal assured for support (including where the obligation for
      support has been established owing to customary or indigenous law).
A maximum of ten children can be assured per policy.

Baby Benefit
The child of a female principal assured or female spouse (NB: not “another dependant”) enjoys free
cover for the first 6 months after birth (even if the child was not added to the policy as an assured).
•    Baby Benefit amount: R1 000 (see note)
•    When is it paid out?
     At the death of a baby
     −
                     th
         after the 28 week of pregnancy
     −   within 6 months of birth.
Note: Babies who have already been added to the policy as assureds, receive:
      − R1 000 (Baby Benefit) plus
      − 50% of the benefit amount assured.

ANOTHER DEPENDANT
Another dependant is any person (maximum three per policy) such as a brother, a sister or a second
spouse, who is financially dependent on the principal assured. Another dependant need, however, not
to be related to the principal assured.
For as long as an institution is the policy-owner, only one insured assured, the principal assured, is
permitted on the policy.

    COMMENCEMENT OF COVER

•    Principal assured, spouse and children
     The first premium is payable on the policy commencement date. Sanlam Life’s obligations in terms
     of this policy take effect only after the first premium is paid.
•    Principal assured, spouse, parents, parents-in-law and the other dependant
     − Natural death or suicide: A waiting period of 6 months applies from policy commencement date.
     − Non-natural death: No waiting period applies.
     − There is no waiting period for children.
     −   If the cover is increased after the inception date, the same waiting period that applied on the
         inception date will apply for the amount by which the cover is increased.




GE 10/2004                                            BG8
    DEATH BENEFIT AMOUNTS

The principal assured selects the levels of cover of the assureds (within limits). If an institution is the
policy-owner, the institution chooses the cover level. There is no limit as to the number of The
Funeral Help Plan policies that a person may take out. However, the total benefit amount under these
policies, which he/she may enjoy at Sanlam Life, is limited.

Provisions in respect of the choice of cover amounts
The following provisions apply when choosing the various cover amounts for each assured:
•     The cover in respect of the spouse may not be less than 25% of that of the principal assured.
•     All parents must be on the same level of cover.
•     All children must be on the same level of cover.
       Note: The total amount of all benefits (with all assurers) payable at the death of a child younger
             than 14 years is limited to the amount determined by legislation applicable on the date of
             the claim.
•     Any amount in multiples of R500 between the minimum and maximum is available for each
      assured.
•     No assured’s benefit amount may be greater than that of the principal assured. The total cover
      which any assured may have with Sanlam Life is limited.

COVER LEVELS

                                               Per Policy
           Assured                                                               In total at Sanlam (1)
                                  Minimum                  Maximum (1)
    Principal assured              R5 000                      R15 000                  R15 000
    Spouse                         R2 000                      R15 000                  R15 000
    Parents and parents-
    in-law                         R1 000                      R10 000                  R15 000

    Children (2)                   R1 000                      R 5 000                  R15 000
    Dependent person               R1 000                      R 5 000                  R15 000


(1) The benefit amounts of policies with Indexplan can grow to more than the maximum benefit
    amounts that applied at inception.
(2) At the death of children younger than 6 years only 50% of the chosen death benefit amount will be
    paid out.

A policy of which an institution is the owner is taken into account in determining how much cover in
terms of a Funeral Help Plan is still available for a member. Also, no cover level alterations may be
permitted on such a policy.




GE 11/2003                                               BG9
COVER FOR CHILDREN
The same benefit amount must be chosen for all the dependent children (in other words, from anb 1 up
to anb 24).

The following procedure must be used to determine how much cover is available for each individual
child:

 Step 1:     Select the level of cover for the children. It must be within the limits set for each policy (see
             previous page).
 Step 2:     (a)    Determine the amount of cover which is available in terms of Section 55 of the Long-
                    term Insurance Act (previously Section 50):
                    • Children anb 1 up to anb 6:           R10 000 less all existing life cover at Sanlam
                                                            Life or from any other source.
                    • Children anb 7 up to anb 14:          R30 000 less all existing life cover at Sanlam
                                                            Life or from any other source.
             (b)    Determine how much cover the child may still get from Sanlam Life under this policy:
                     • R15 000 less existing cover under other Funeral Help Plan policies.
 Step 3:     The available cover for the specific child is the lesser amount of (a) and (b).
 Step 4:     Compare the available cover with the cover requested (by the principal assured) for
             children. If a child’s available cover is less, the cover of all the children will have to be
             limited.

NB: In the case of existing cover the baby benefit will not be taken into account.


Example:
                        Total life cover
                                              Existing cover
                        with Sanlam Life                            Available        Cover        Allowable
  Child        anb                              Under The
                        as well as other                             cover         requested        cover
                                             Funeral Help Plan
                           assurers*
 Child 1      anb 3           None                  None             R10 000        R3 000         R3 000
 Child 2      anb 6         R 8 000               R 4 000            R 2 000        R3 000         R2 000
 Child 3      anb 8         R10 000               R 5 000            R10 000        R3 000         R3 000
 Child 4     anb 12         R25 000               R14 000            R 1 000        R3 000         R1 000
 Child 5     anb 14         R30 000               R10 000            R      0       R3 000         R      0
* Sanlam Life cover includes Funeral Help Plan policies.
Calculate Child 4’s available cover as follows:
   Step 1: (a) R30 000 – R25 000 = R5 000
             (b) R15 000 – R14 000 = R1 000
   Step 2: Available cover = R1 000.
   Step 3: Available cover is less than chosen cover.
Conclusions:
1. Child 5 cannot be accepted under the policy.
2. The available cover for Child 4 is only R1 000. The proposer will have to adjust the benefit amount
    for all the children to R1 000 or remove Child 4 from the proposal.
3. If Child 4 is removed from the proposal, only R2 000 is available for the first three children, because
    the available cover for Child 2 is R2 000.




GE 11/2003                                            BG10
                                     RIDER BENEFITS AVAILABLE

     WAIVER OF PREMIUM BENEFIT (PB)

The Waiver of premium benefit is only available on Plan C policies.

In terms of the Waiver of Premium Benefit at the death of the principal assured, the premiums in respect
of the remaining assureds are waived when the principal assured dies.

After the death of the principal assured the death benefits of the remaining assureds stay constant.
Provisions in respect of waiver of premium benefits:
1)    It is not available in the case of policies where the principal assured is the only person assured.
2)    A waiver of premium benefit claim will not be admitted if the death of the principal assured results
      from suicide within 24 months of the inception date/reinstatement of policy.
3)    A policy-owner cannot add lives assured to the policy once a waiver of premium benefit claim has
      been admitted.
4)    Waiver of premium benefits are available only to the person who was the principal assured at the
      time the policy was taken out.

    INDEXPLAN

•    Indexplan (premium growth) is compulsory.
•    Indexplan includes premium growth and cover growth.
•    The premium increase is calculated on the full premium (always on the policy anniversary).
•    No premium increases may be skipped. If a client should skip premium growth, it (premium growth)
     will be cancelled. If the client wishes to resume premium growth, this must be done by means of a
     notation.
•    If Indexplan is cancelled, the policy will continue with the same level of premium and the cover will be
     decreased every subsequent year at:
     −   approximately 3,2% per annum on Plan A and B policies
     −   approximately 3% per annum on Plan C policies.
Premium growth
•    The premium grows annually at:
     −   a fixed rate of 8% for Plan A and B policies
     −   the increase in the inflation rate (consumer price index) for Plan C policies.
•    The maximum premium growth rate is 20%.
•    The minimum growth rate is 5%.
•    There is no minimum premium growth amount.
Cover growth
•    The cover growth rate is determined annually by Sanlam Life. At present this is:
     −   60% of the premium growth rate for Plan A and B policies
     −   70% of the premium growth rate for Plan C policies.




GE 11/2003                                              BG11
    FUNERAL TRANSPORT BENEFIT


Funerary Management Services (FMS) provide a Transport benefit for the deceased to the funeral
parlour, which is outside 100km radius of the burial place. This feature will automatically be added to all
new policies.

Transport will be provided from any place within the RSA, as well as from countries in the Southern
African region (below the 22-degree parallel) to the RSA. Since only clients with a valid RSA ID-
document are covered, no transport will be available from the RSA to these other countries.

The countries are: Namibia, Botswana, Zimbabwe, Mozambique south of the 22-degree parallel,
Swaziland and Lesotho.

Other services offered:
•   A toll free number is provided which answers in Sanlam Life’s name. The operators are able to
    communicate in a range of languages and will arrange for the body of the deceased to be
    transported.
•   Operators can assist callers by arranging contact with a reputable funeral parlour.
•   Cross border transport is handled. Transport will be arranged from all Southern African countries as
    specified above.

The number of the FMS call centre is supplied in our policy documents. The particulars are as follows:
         Funerary Management Services (Pty) Ltd
         Tel: (011) 790-8500




GE 11/2003                                          BG12
                                 UNDERWRITING REQUIREMENTS


 RATE DIFFERENTIATION

No rate differentiation is applicable. For the principal assured, spouse, parents/parents-in-law and the
other dependant, the rate is determined by the person’s age. There is one fixed rate that is levied per
child and the normal discount for women will apply.

 NEW PROPOSAL (BASIC POLICY)

Occupational Underwriting
No underwriting in respect of occupation or part-time activities is required.
Full particulars in respect of the principal assured’s occupation are required for statistical purposes only.

Medical Underwriting
− The proposer must answer two medical questions with regard to the principal assured.
− A "yes" response to either one of these questions will necessitate referral to a medical underwriter.
− No medical examinations will be required and no loading will be levied. Sanlam Life, however,
  has the right to reject an application totally or partially. Sanlam Life also retains the right to request
  an HIV test for any member.

  WAIVER OF PREMIUM BENEFIT (PB)

Occupational Underwriting
No underwriting in respect of occupation or part-time activities is applicable.
Medical Underwriting
Full medical underwriting is required.
If the principal assured is for some reason or other rejected for PB, his/her spouse can be appointed
principal assured so that PB can possibly be added to the policy. If, however, the spouse is also
rejected for medical reasons, it will not be possible to obtain PB.

 ADDING ASSUREDS TO AN EXISTING POLICY
The medical question i.r.o. all assureds must be answered.
For as long as an institution is the owner of the policy, members may not be added or cancelled.


                                           COVER FOR AIDS)

The policy always offers cover for Aids (for PB as well). The death benefit will therefore be paid out
and the waiver of premium benefit will become operative if an assured dies as a result of Aids. Sanlam
Life, however, retains the right to request an HIV test at proposal and if the result is HIV positive, the
policy rider benefits can be refused.




GE 8/2006                                             BG13
                                            POLICY VALUES


    CASH VALUE

The policy has no cash value.

    LOAN VALUE
No loans are permitted.

    FULLY PAID-VALUE (VOP value)
The policy cannot be made fully paid-up.


                                               NOTATIONS

    PLAN A AND B

•    Notations from Plan A to B and vice versa are allowed but not
     −   from Plan A or B to Plan C, or
     −   from Plan C to Plan A or B
•    No more than three children may be added to a policy during the term of the policy.
•    Voluntary removal of the principal assured is not allowed.
•    Sanlam Life will not allow a spouse to be replaced by another once he/she has been removed for
     any reason. It is suggested that a new policy is taken out in such an instance. Thus spouse may
     only be added to a Plan A (becoming a Plan B) on policies which did not have a spouse previously.


                                                    TAX

PREMIUMS
If an employer pays the premiums of the policy on behalf of one of his employees, the premiums are:
− tax-deductible for the employer (in terms of Section 11(a) and
− taxable as an income for the employee.




GE 11/2003                                           BG14
                                            POLICY–OWNERSHIP



•    Individuals (natural persons) or institutions (e.g. banks, employers, etc.) can be a policy-owner.
•    The policy-owner need not be a life assured.
•    The policy-owner is entitled to all benefits in terms of the policy.
•    The policy-owner may name at most two beneficiaries who may receive the death benefit on his/her
     behalf.
•    In the case of a Plan C policy the policy-owner may nominate a maximum of two nominees (in
     order) to whom policy-ownership should pass at his/her death.
•    At the death of the principal assured, in the case of a Plan B policy, the spouse has the option to
     become the new policy-owner, otherwise the policy lapses.
•    For as long as an institution is the policy-owner, no appointments in respect of beneficiaries and
     nominees may be made.

    NOMINATION OF BENEFICIARY(IES) AND NOMINEES

When a policy is taken out, or at any stage after that, the policy-owner (natural person) can name (or
change) beneficiaries or nominees. The nomination must be done in writing and is deemed valid only if
confirmed in writing by Sanlam Life. No nominee(s) and beneficiary (beneficiaries) may be appointed in
the case of a policy of which the policy-owner is an institution.
BENEFICIARIES
The policy-owner can nominate a person/persons (maximum 2 beneficiaries) to whom Sanlam Life must
pay the death benefits at the death of an assured. If the deceased is somebody else than the
policyholder, payment will be made to the policyholder.

If the policy-owner is an assured and he/she should die, the death benefit for that policy-owner will be
paid to:
   •    a beneficiary if beneficiaries were appointed, or
   •    the new policy-owner if beneficiaries were not appointed.


NOMINEES
The policy-owner can also nominate a nominee for ownership (maximum 2) who will become the new
policy-owner when the former dies. If two nominees are nominated, a sequence will have to be
stipulated.

If the policy-owner does not nominate a particular person as his nominee for ownership, one of the
surviving assureds will automatically become the new policy-owner and in the following sequence:
1) Principal assured                             4) Children
2) Spouse                                        5) Parents-in-law
3) Parents                                       6) Other dependant

Each new policy-owner can nominate his/her nominee(s) for ownership as well as the beneficiaries who
should receive the death benefit.


    CESSIONS

The policy cannot be pledged or ceded as collateral security. Ownership can, however, be changed by
means of a cession between individuals . The exception is cessions where non natural persons such as
banks are involved. Only outright cession will be allowed.




GE 11/2003                                              BG15
                                       IDENTIFICATION POLICY

The identification policy will always be strictly adhered to as explained below. Proposals which do not
meet all the requirements will not be processed in order to prevent problems when a claim is submitted.
        NB:
        • Only persons with RSA identity numbers qualify for this policy
        • It is important to take note that CLAIMS WILL NOT BE ACKNOWLEDGED if the
          identification which is provided when the claim is submitted, differs from the
          identification which was provided initially.

RSA POLICIES (policies issued in RSA)
Assureds
•   Where possible, copies of RSA IDs of the principal assured and other dependants must be obtained
    (it is in the client's interest to ensure that there are as few problems as possible at the claim stage).
•   If it is not practically possible to obtain the copies, we require RSA identity numbers and full names
    from all adults - that is persons 18 years and older.
•   For children on Plan A and B policies the ID number or the full birth name with birth date is required.
    If the full birth name and/or birth date is incorrect, Sanlam Life may refuse to pay a claim at claim
    stage.
•   The full names and surname of all members applying are always required.
•   The RSA identity numbers of children are also required for Plan C policies. But where the number
    is not known, or where one does not exist yet, the date of birth is required for children under 18
    years, and the proposer must sign a declaration on RSA identity documents on the particular
    proposal form.
    −   AEB44: Proposal for a new policy
        A separate declaration by the proposer appears on the proposal form.
    −   AEB2: Amendments to the Funeral Help Plan
        The declaration forms part of the general declaration by the proposer/principal assured.

Nominees and beneficiaries
An RSA identity number is always compulsory in the case of nominees and beneficiaries. If the
person does not have a valid RSA identity document he/she cannot be nominated or named as a
beneficiary.
Other interested parties
Cessionary, stop order payer and the person as debit order payer, must also supply valid identity
numbers.
DECLARATION BY THE INTERMEDIARY
The intermediary must always sign the declaration on the proposal form that he/she has seen the RSA
identity documents of all assureds, nominees and beneficiaries and that the information on them
agrees with the information on the relevant proposal form.
    −   AEB44: Proposal for a new policy
        The declaration in this regard (on the proposal form) forms part of : “Further information supplied
        by the intermediary”.
    −   AEB10: Proposal by an institution for The Funeral Help Plan
        The declaration in this regard (on the proposal form) forms part of: "Further information supplied
        by the intermediary".
    −   AEB2: Amendments to the Funeral Help Plan
        The declaration in this regard (on the proposal form) forms part of : “Further information supplied
        by the intermediary”.

Please Note: All those concerned must please ensure that the above-mentioned policy is
             applied strictly and without any exception.

Enquiries
Product Support, telephone (021) 916-3082.


GE 8/2006                                             BG16
                                             CLAIM PROCEDURES


    DEATH BENEFIT

•      When an assured dies, the benefit amount will be paid out within 48 hours after the receipt of the
       necessary documents.
•      The death benefit will always be paid to the policy-owner. At the death of the policy-owner who is
       also an assured, the death benefit will be paid to a beneficiary and not to the new policy-owner. All
       existing beneficiaries on the policy will be retained, until the new policy-owner revokes their
       appointment in writing. If there is no beneficiary, the death benefit will be paid to the new policy-
       owner. Payment to either the policy-owner or his beneficiary will relieve Sanlam Life of any obligation
       to pay any other person.
Please Note: In the case of policies which have been reinstated after lapsing as a result of the non-
             payment of premiums, no claims will be paid in respect of assureds who died during the
             period in which premiums were outstanding.

TO SUBMIT A CLAIM
A claim form (AE2642) can be completed when a death claim is submitted (not compulsory).

The following must be supplied when a claim is submitted:
 (i) Of the deceased
           •   A death certificate (BI-5 or BI-20) issued by the Department of Home Affairs. A medical
               doctor must certify the death in the case of a stillborn child.
           •   The identity number of the deceased assured, with the following concessions:
               −   If the deceased is a child, parent or parent-in-law, the date of birth is sufficient. This
                   information does not have to be verified by any documents.
               −   If the deceased is a baby younger than 6 months who has not yet been added to the policy,
                   a copy of the birth certificate/identity document or a copy of the application for registration,
                   will be required to prove that such a child was in fact born.
           •    If the death of the deceased was due to unnatural causes, a police statement must be
               submitted.
    (ii)   Of the person who requests payment
           •   Proof of identity of the person requesting payment.




GE 11/2003                                                BG17
                                               REVISIONS


Sanlam Life reserves the right to revise the premium, benefits and provisions annually on the policy
anniversary if necessary.

If a revision of premiums is done after a waiver of premium benefits claim has been admitted, the
benefits will be adjusted instead of the premium.

The policy-owner will be informed in advance about any adjustments.



                                            −
                                       PROOF−FREE OPTION(

A dependent child’s death cover expires on the policy anniversary preceding his/her
     − 21 birthday in the case of Plan A and B policies
          st

     − 25 birthday in the case of a Plan C policy.
           th

If the child submits proof to Sanlam Life’s satisfaction that he/she is HIV negative, he/she has the option
to effect new life cover proof-free.
•   Maximum cover available: R30 000
•   Option period: Within 3 months of the expiry of the cover.
•   Medical underwriting: Only an HIV negative blood test is required (normal rules in respect of Aids
                          apply).
•   New assurance which can be effected in terms of the option:
    −   Whole-life assurance
    −   Endowment assurance
    −   Retirement Annuity assurance
    −   Funeral insurance. PB not available unless the principal assured is willing to undergo full
        medical underwriting.
•   Any assurance effected in terms of the option would be subject to the normal requirements as for
    any new assurance. The requirements will be those which apply on the date on which the option is
    exercised (proof of good health excluded).
•   When the option is exercised, the cover must be continuous, i.e. the inception date of the new policy
    must be the same date as that on which the child's cover is terminated.




GE 11/2003                                          BG18
                                  SECTION BJ


                           LIFE AND TERM ANNUITIES


                                                                         Page


GENERAL INFORMATION: Life and Term Annuities ………………………………                BJ1
   Source of consideration ..……………………………………………………………..                   BJ1
      – Optional purchases …………………………………………………………….                      BJ1
      – Compulsory purchases ………………………………………………………..                     BJ1
   Products available …………………………………………………………………….                        BJ1
   Comparison between life and term annuities ……………………………………...          BJ2
   Minimum consideration ……………………………………………………………….                       BJ3
   Inception date ………………………………………………………………………….                          BJ3
   Rates ……………………………………………………………………………………                                BJ3
   Instalments …………………………………………………………………………….                            BJ3
      – Mode of payment of instalments ……………………………………………..               BJ3
      – Minimum instalment ……………………………………………………………                       BJ4
      – Issuing fee ………………………………………………………………………                          BJ4
      – Policy fee ……………………………………………………………………….                          BJ4
      – Calculation of monthly life annuities instalments …………………………..   BJ4
TAX ASPECTS: Life and Term Annuities …………………………………………….                  BJ5
   Compulsory purchases ……………………………………………………………….                        BJ5
   Optional purchases ……………………………………………………………………                         BJ5
   Life and term annuity instalments: Section 1 ………………………………………          BJ5
   Exemption of capital element: Section 10A ………………………………………..           BJ5
       – Section 10A certificate …………………………………………………………                  BJ5
   Calculation of the non-capital portion: Term annuities ……………………………    BJ5
   Calculation of non-capital portion: Life annuities ………………………………….     BJ6
   Tax deduction ………………………………………………………………………….                           BJ6
       – Fourth Schedule of the Income Tax Act …………………………………….           BJ6
       – Request to change tax rate …………………………………………………..                BJ6
       – IRP5 certificate …………………………………………………………………                      BJ6
   Life and term annuity quotations ……………….……………………………………                BJ7
   Change of legislation or measures …………………………………………………..               BJ7
TERM ANNUITIES …………………………………………………………………………                              BJ8
   Special features ……………………………………………………………………….                         BJ8
   General information ……………………………………………………………………                        BJ8
       – Plan code ……………………………………………………………………….                          BJ8
       – Term ……………………………………………………………………………..                            BJ8
       – Size of term annuity instalment ………………………………………………              BJ8
       – Investment guarantee …………………………………………………………                     BJ8


                                                                         2/…



GE 10/2004                             BJ
                                       -2-


                                                                           Page
TERM ANNUITIES (continued)
   How a term annuity works ……………………………………………………………                        BJ8
   Early termination/Surrendering ………………………………………………………                    BJ9
   Growth …………………………………………………………………………………                                  BJ9
   A term annuity with a Sanlam unit trust …………………………………………….              BJ9
      – Procedure for proposal ………………………………………………………..                     BJ10
LIFE ANNUITIES …………………………………………………………………………...                             BJ11
    Special features …………………………………………………………………..……                         BJ11
    General information ……………………………………………………………………                         BJ11
       – Plan code ……………………………………………………………………….                            BJ11
       – Term …………………………………………………………………………….                               BJ11
    Size of life annuity instalments ……………………………………………………….                BJ11
       – Rates …………………………………………………………………………….                              BJ11
       – Effect of interest rates …………………………………………………………                   BJ11
       – Effect of period of payment ……………………………………………………                  BJ11
    Options in the case of life annuities .…...…………………………………………...         BJ12
       – Single-life annuity without a term certain ……………………………………         BJ12
       – Single-life annuity with a term certain ……………………………………….          BJ12
       – Joint-life annuity (survivor’s) …………………………………………………..             BJ12
       – Growth life annuity (single-life or joint life) …………………………………..   BJ13
    Comparative examples ……………………………………………………………….                         BJ13
    An annuity combined with a whole-life policy ………………………………………           BJ14
BONUS LIFE ANNUITIES ……………………………………………………………………..                          BJ15
   Special features ………………………………………………………………………..                          BJ15
   General information ……………………………………………………………………                          BJ15
       – Plan code ……………………………………………………………………….                            BJ15
       – Term ……………………………………………………………………………..                              BJ15
   Size of bonus life annuity instalment ………………………………………………..              BJ15
   Growth …………………………………………………………………………………..                                BJ15
   Guarantee ………………………………………………………………………………                                BJ15
   Options in the case of bonus life annuities …………………………………………            BJ15
   Illustrations ……………………………………………………………………………..                           BJ15

                                                                           3/…




GE 10/2004                               BJ
                                             -3-


                                                                                       Page


PRIVATE PENSION ……………………………………………………………………….                                           BJ16

PENSION WITH CAPITAL REPAYMENT ……………………………………………...                                    BJ17
  AT A GLANCE ………………………………………………………………………….                                            BJ17
  FURTHER ASPECTS ………………………………………………………………….                                           BJ17
      How the product works …………………………………………………………..                                   BJ17
      Tax ………………………………………………………………………………….                                             BJ17
      Investment limits …………………………………………………………………..                                    BJ18
      Age at inception …………………………………………………………………..                                     BJ18
      Type of pension …………………………………………………………………..                                      BJ18
      Double life annuity ………………………………………………………………..                                   BJ18
      Commission and service fee …………………………………………………….                                 BJ18
      Amendments to the policy ……………………………………………………….                                  BJ19
      Cessions, beneficiaries and nominees …………………………………………                            BJ19
      Table and plan codes …………………………………………………………….                                    BJ19
      Payment of instalments at the death of the life annuitant …………………….              BJ19
      Policy at death of beneficiary/nominee …………………………………………                          BJ19
      Internal transfers (“other transfers”) to other policies and unit trusts ………..   BJ20
      Administrative information ……………………………………………………….                                BJ20




GE 10/2004                                     BJ
                  GENERAL INFORMATION : LIFE AND TERM ANNUITIES

•   Life and Term annuities are meant for the client who wants to invest an amount (the consideration)
    with a view to receiving regular instalments (a pension).
•   A life annuity is linked to a person’s life whereas a term annuity is linked to a fixed term.

SOURCE OF CONSIDERATION
The source of the consideration used to purchase a life or term annuity with which a life or term annuity
can be bought, determines the rates applicable and the type of product which may be bought.
       −   Optional purchases:
           In which case the client can use his own funds for this purpose.

       −   Compulsory purchases:
           It is required by law that at least two-thirds of the proceeds of a retirement annuity (except
           where the retirement annuity is very small), or a part of the proceeds from certain pension
           funds be used by the member to purchase a life pension.

PRODUCTS AVAILABLE
•   Term annuities (compulsory and optional purchases)
          The instalment (constant or increasing) is pre-determined and is guaranteed.
           NB:     Compulsory term annuities are available only for investment where the purchase
                   sum of a death claim originates from a retirement or retirement annuity fund. The
                   relevant retirement or retirement annuity fund may be from either Sanlam or any
                   other insurer. The aim of a compulsory term annuity is not to replace the
                   compulsory lifelong pension that usually has to be paid in the case of this type of
                   business. Compulsory term annuities may only be paid if provisions in the rules of
                   the Fund (from which the money originates) prescribe a term for which an income
                   must be paid; for example up to a child's eighteenth birthday.

•   Life annuities (compulsory and optional purchases)
           The instalment (constant or increasing) is pre-determined and is guaranteed.
•   Bonus life annuities (compulsory purchases only)
         The instalment grows yearly at a bonus rate declared by Sanlam. Sanlam guarantees that
         the instalments will never decrease.




GE 10/2004                                              BJ1
                 COMPARISON BETWEEN LIFE AND TERM ANNUITIES
                                                           Life annuity/Bonus life
                                Term annuities                    annuities
             Definition    Income (pension) is pay-      Income (pension) is payable
                           able for a pre-selected       up to the death of the life
                           term       (irrespective of   annuitant or to the end of the
                           whether the annuitant is      chosen term certain (should
                           still alive or not).          the life annuitant die before
                                                         the term certain expires).
             Term          5 to 15 years                 Whole-life.    The proposer
                                                         chooses one of the following
                                                         terms certain:
                                                          0-years (terminates at
                                                          death)
                                                          5-years
                                                          10-years
                                                          15-years
             Plan codes    Plan 1                        Plan 2 : Single-life annuity
                                                         Plan 3 : Joint-life annuity
             Age at        Not applicable                20 to 86 anb
             inception                                   (Proof of age must be given
                                                         at the time of proposal)
             Instalments
             payable to    Annuitant                             Life annuitant

             Rates         The same rates apply for      Separate rates apply for
                           males and females (rates      males and females as well
                           according to the term).       as for constant and
                                                         increasing instalments.
             Proposal
             form                               Use form AEB42




GE 10/2004                                       BJ2
              GENERAL INFORMATION: LIFE AND TERM ANNUITIES (continued)

MINIMUM CONSIDERATION

There is no specific minimum lump sum. The only requirement is that it should be sufficient to provide
the minimum life or term annuity instalments.


    INCEPTION DATE
The inception date is determined by the date on which the consideration is paid in at a contracted bank
branch:
−
                          th
       On or before the 15 of a month:
       First day of the month in which the consideration was received.
−
                    th
       After the 15 of a month:
       First day of the month following the month in which the consideration was received.

INCEPTION DATE AND BASIS OF RATES
See Section AA for the policy in respect of investments where the consideration is derived from a
Sanlam policy or fund.

    RATES

Sanlam manages a separate investment portfolio specifically for life annuities and term annuities to
make our rates as competitive as possible.
The life/term annuity rates are different for each day of a month, because they depend on the specific
day on which the consideration is paid in at a contracted bank branch.
A basic rate applies for a payment made on the 1st day of a month. The rates for considerations made
on dates other than the 1st are adjusted as follows:
(i)      For a payment made on the 2nd day up to and including the 15th day of a month:
         The basic rate applying on the 1st day of the same month is reduced by the interest for the
         number of days from the 1st day up to and including date of payment.
                                        th
(ii)     For a payment made on the 16 day up to and including the last day of a month:
         The basic rate applying on the 1st day of the next month is increased by interest for the number
         of days from date of payment up to and including the 1st day of the next month.

INSTALMENTS

MODE OF PAYMENT OF INSTALMENTS
•      Instalments may be paid monthly, quarterly, half-yearly or annually in arrears/advance according to
       the client’s need.
       Income is usually paid monthly in arrears. If the monthly income is very small, Sanlam will pay out
       the income in quarterly, half-yearly or annual instalments. This way we keep administrative
       expenses as low as possible – to the benefit of our client.
•      For your client’s convenience Sanlam prefers to pay the income directly into a bank account.




GE 10/2004                                             BJ3
MINIMUM INSTALMENT (payable to the client)
      Monthly          :     R100,00                           Quarterly   :     R200,00
      Half-yearly      :     R300,00                           Yearly      :     R600,00


ISSUING FEE
An issuing fee of R350,00 is payable once only.

POLICY FEE
     Life Annuities:

      Monthly          :     R15,00                            Quarterly   :     R30,00
      Half-yearly      :     R45,00                            Yearly      :     R60,00


     Term Annuities:

      Monthly          :     R11,50                            Quarterly   :     R23,00
      Half-yearly      :     R34,50                            Yearly      :     R46,00



CALCULATION OF MONTHLY INSTALMENTS: Life annuities
               (C – I) x R
Instalment =                    – P (rounded off to nearest cent)
                    10 000

    Where:      C     =    Consideration
                P     =    Policy fee
                R     =    Rate per R10 000 consideration
                I     =    Issuing fee (once only)

                Example:
                Assume: Annuitant                        :   male 60 anb
                         Optional Life Annuity           :   10 year guarantee
                         Consideration                   :   R50 000
                         Rate                            :   152,22

                                           (50 000 – 350) x 152,22
                Monthly instalment =                                   – 15,00
                                                    10 000

                                       =   R740,77 per month




GE 10/2004                                              BJ4
                               TAX ASPECTS: Life and Term Annuities

COMPULSORY PURCHASES
The total life or term annuity instalment is taxable, (e.g. in the case of an RA).

OPTIONAL PURCHASES
Usually only the non-capital portion (interest earned on investment) of every instalment is taxable. The
taxable portion does not qualify for the R11 000 (R16 000 for persons 65 years and older) exemption.
See the stipulations of Section 1 and Section 10A below.

LIFE AND TERM ANNUITY INSTALMENTS: Section 1
In terms of Section 1 of the Income Tax Act, the full instalment from a life or term annuity is deemed to
be gross taxable income for the annuitant or life annuitant. This means that the annuitant’s/life
annuitant’s income is increased by the amount of the life or term annuity instalment, but with the
following exemption taken into account.

EXEMPTION OF CAPITAL ELEMENT: Section 10A
In terms of Section 10A of the Income Tax Act, the capital element of the purchased life or term annuity
is exempted from tax if:
   •    The life or term annuity is payable to the proposer of the life annuity or to his spouse;
   •    The proposer is a natural person (i.e. not an institution e.g. a trust).
A Section 10A exemption therefore will not apply in the following cases:
   •    where a trust is the policyholder and a child is the annuitant
   •    where a trust is the policyholder and the annuitant (annuity is taxed as a trust)
   •    if the annuity is ceded outright.
NB:     The exemption does apply where a trust is the policyholder and annuitant if the trust was
        created solely for the benefit of a person where the court has declared the person to be of
        unsound mind and incapable of managing his own affairs.

Section 10A certificate
In the case of optional purchases, Sanlam will send, together with the contracts, a Section 10A
certificate (in duplicate) indicating the tax-free portion of the life annuity or term annuity instalment. One
of these certificates must be sent to the South African Revenue Service (SARS) together with the initial
tax return.

CALCULATION OF THE NON-CAPITAL PORTION: Optional Term annuities
                                  C
  Non-capital portion = I –
                                12 x n

       Where:      I = Instalment per month
                   C = Consideration
                   n = Term of term annuity

                  Example:
                  Assume: Term Annuity for 10 years
                           Consideration    : R50 000
                           Instalment       : R805,00 p.m.

                                                     50 000
                   Non-capital portion = 805 –
                                                    12 x 10
                                            = 805 – 416,67
                                            = R388,33




GE 10/2004                                               BJ5
CALCULATION OF NON-CAPITAL PORTION: Optional life annuities
                                 C
Non-capital portion = I –               (rounded off to lower second decimal)
                              12 x E

        Where:     I      = Instalment per month
                   C      = Consideration
                   E      = Life expectancy in years

                   Example:
                   Assume: Annuitant                    : male 60 anb
                            Optional Life Annuity       : 10 year guarantee
                            Consideration               : R50 000
                            Life expectancy             : 14 years
                            Monthly instalments         = R740,77

                                                      50 000
                   Non-capital portion = 740,77 –
                                                      12 x 14
                                         = 740,77 – 297,62
                                         = R443,15

TAX DEDUCTION

Fourth Schedule of the Income Tax Act
In terms of the Fourth Schedule of the Income Tax Act the following is applicable when a life annuity
contract is concluded:
    •    Paragraph 1:
         −   The assurer is regarded as an employer.
         −   The recipient of a term or a life annuity (annuitant) is regarded as an employee of the assurer.
    •    Paragraph 2:
         −   If no PAYE rate is indicated Sanlam is obliged to withhold income tax according to PAYE
             scales from every instalment and to remit it to the SARS.
         −   The taxable element of the term or life annuity is deemed to be the annuitant’s only income.

Request to change tax rate
If the application of the Fourth Schedule results in too much or insufficient tax being recovered from the
annuitant or life annuitant during the year of assessment, the proposer may request that
•   a percentage higher than the PAYE rate (applicable only to the instalment) be withheld for tax; or
•   the proposer can arrange for a directive from the SARS, on the basis of which Sanlam will withhold a
    percentage lower than the PAYE rate (or even no tax at all).

IRP5 certificate
At the end of each tax year, Sanlam provides an IRP5 certificate to each client indicating the taxable
income as well as the tax that has been paid over. The client must submit the certificate together with
his/her tax return.




GE 10/2004                                             BJ6
LIFE AND TERM ANNUITY QUOTATIONS
The quotation is calculated at the specified tax rate. If no tax rate is specified, the PAYE rate will be
used.
If the specified tax rate is less than the PAYE rate, the following message is printed on the quotation:
   “NB: Since the requested tax rate is less than PAYE, the above quotation will only be accepted
        as valid if it is accompanied by a tax directive from the South African Revenue Service
        (SARS).”

 CHANGE OF LEGISLATION OR MEASURES
Should a government at any time effect legislation or measures which, with regard to the fund that
Sanlam keeps for life annuity, term life annuity and term annuity policies,
   – alter a tax rate or fee; and/or
   – require that underlying assets be invested in another way,
   Sanlam may recalculate and alter the policy benefits to an extent which is reasonable.




GE 10/2004                                            BJ7
                                           TERM ANNUITIES

SPECIAL FEATURES
•   A term annuity is a fixed interest investment.
•   In the case of optional purchases the non-capital and the capital portions are paid in equal
    instalments over a selected term.
•   A term annuity is linked to the selected term only. It is not linked to a life(risk) like a life annuity. The
    age of the assured, therefore, plays no part in determining the instalment (income).

GENERAL INFORMATION
See pages BJ1 to BJ3.
•   Plan code: Plan 1.
•   Term: 5 years up to 15 years
•   Size of term annuity instalment
    The size of the term annuity instalment is determined by the term annuity rates valid on date of
    purchase.
•   Investment guarantee
    The term annuity instalment is guaranteed for the full term and is not influenced in any way by
    changes in interest rates.

HOW A TERM ANNUITY WORKS
The following example illustrates the operation of a term annuity:
       Assume:      • Capital amount: R1 million
                    • Term: 5 years
                    • Term annuity instalment: R286 699 per annum
                    • Effective rate of return: 13,34% per annum
                        The effective rate of return is the actual rate which the investor earns on the
                        capital not paid out yet. No reinvestment assumption is therefore involved and
                        direct comparison with the effective annual rate of return of any other
                        investment is possible.

     Composition of each instalment (optional purchases)

                 Capital at beginning                         Composition of the instalment
        Year
                     of year (a)                Non-capital portion (b)              Capital redemption (c)
          1           R1 000 000                        R133 432                            R153 267
          2           R 846 733                         R112 981                            R173 718
          3           R 673 015                         R 89 802                            R196 897
          4           R 476 118                         R 63 529                            R223 170
          5           R 252 948                         R 33 751                            R252 948

     (a) The capital at the beginning of each year is the capital at the beginning of the previous year
         less the capital redemption.
     (b) The non-capital portion is 13,3432% p.a. (to be exact) calculated on the outstanding capital
         at the beginning of the year.
     (c) The capital redemption is the difference between the total instalment of R286 699 and the
         non-capital portion for the year.
GE 10/2004                                              BJ8
TAX: TERM ANNUITIES
See page BJ5 for full particulars regarding tax.

EARLY TERMINATION/SURRENDERING
According to contract, a term annuity cannot be commuted to a cash sum. However, in the case of
optional purchases, Sanlam is prepared to let the remaining instalments be surrendered for a cash sum
for as long as it remains company practice to do so.
The size of the cash sum is influenced by the following factors:
−     It will be decreased by the instalments already paid out.
−     The level of interest rates prevailing at the time of surrender (e.g. cash value will drop if interest
      rates rise – see the example below).
−     Part of the cash sum may be subject to income tax. The capital portion of this amount will be tax-
      free in terms of section 10A.
The principle is illustrated by the following example:
            Example:
            Suppose Sanlam purchases units at R100 per unit earning interest at 15% p.a. at inception
            date. If these units are sold at a later stage and market interest rates have risen to 20% p.a.
            in the meantime, the prospective buyer of the units will not be willing to pay R100 per unit,
            but a price which is such that will earn him ± 20% per annum is more likely. As the annual
            amount of interest per unit will remain unchanged, the price will most probably be less than
            R100 per unit. There will therefore be a capital loss if a term annuity is surrendered after
            an increase in interest rates. Should interest rates drop, the opposite will apply.
A compulsory term annuity cannot be surrendered at all.


    GROWTH

The client has the option of increasing the annuity instalments by a certain percentage annually. He or
she may select the growth percentage, up to the maximum allowed. The higher the growth rate, the
lower the initial annuity instalment will be. The growth rate may be chosen to one decimal percentage
point, e.g. 5,2% (not 5,25%), up to the current maximum of 10% per annum


    A TERM ANNUITY WITH A SANLAM UNIT TRUST

Investment on the stock market will always contain the elements of uncertainty and risk. Nevertheless,
highly profitable investments can be made with a distribution of these elements by using an annuity
(minimum term 5 years) in combination with any of Sanlam’s unit trusts. The annuity instalment is used
to buy units in the unit trust chosen.
Such a combination offers the investor
     –   guaranteed monthly instalments at competitive rates;
     –   guaranteed annuity for the full term – whether interest rates rise or fall;
     –   a convenient and effective way of funding a regular investment in a unit trust;
     –   an annuity instalment of which only the non-capital portion is taxable (optional purchases); and
     –   an investment in a unit trust with tax-free capital growth.




GE 10/2004                                               BJ9
PROCEDURE FOR PROPOSAL: A term annuity with a unit trust
Fill in the following forms and hand it in at your New Business input point:

(1) TAE7: Sanlam Unit Trusts registration form
    • Unit trust
      Indicate the investor’s choice of unit trust(s) by marking the applicable block. See Section BQ for
      a description of Sanlam’s various unit trusts.

    • Investment plans
       −   Systematic saving (capital building scheme) for regular monthly investment – no initial
           amount is required.
       −   Fill in the total monthly amount to be transferred to Sanlam Unit Trusts. If the amount is to be
           divided between more than one unit trust, please indicate clearly the amount to be invested in
           each one.
       −   State that the monthly instalment derives from an annuity and provide the policy number.
    • Income
      Reinvestment of income is recommended to give impetus to the growth.
    • Registration
      Fill in the investor’s personal details and have the investor sign the registration form.

(2) AEB42 : Term annuity proposal form
     Details regarding the payment of monthly instalments to Sanlam Unit Trusts must be filled in under
     the heading:
     “Details of account(s) for crediting of income.”




GE 10/2004                                           BJ10
                                         LIFE ANNUITIES

SPECIAL FEATURES
•   The client is assured of a guaranteed income.
•   If the client chooses a growth life annuity, the growth rate is fixed and guaranteed.

GENERAL INFORMATION
See pages BJ1 to BJ3.
•   Plan code: Plan 2: Single-life annuity
                   Plan 3: Joint-life annuity
•   Term         : Whole-life

SIZE OF LIFE ANNUITY INSTALMENTS
•   Rates
    For information on different rates for each day of the month, see “Rates” under General Information
    earlier in this section.
    –   The size of the income is determined by the life annuity rates applying at the time the life annuity
        is bought.
    –   Different rates apply for optional and compulsory life annuities.
    –   Subsequent changes in rates have no effect on the income.
    –   The life annuity rates used mainly depend on 2 factors, i.e.:
        (i)    prevailing interest rates and
        (ii)   the expected term of payment of the income (i.e. the age of the assured).

•   Effect of interest rates
    The higher long-term interest rates are on the date of purchase, the greater the income and vice
    versa.
•   Effect of period of payment
    The shorter the expected period of payment of the income being purchased, the bigger the income
    will be and vice versa.
    Life expectancy, and therefore the expected period of payment, differs for males and females of the
    same age.
    Factors which entail a longer expected period of payment, such as a guarantee term or survivor’s
    income, will mean a lower monthly income.




GE 10/2004                                            BJ11
OPTIONS IN THE CASE OF LIFE ANNUITIES
There are several options as to the nature of the income. It is, however, important to realise that the
choice is permanent and that your client will not be able to change his mind later on. The choice
involves the following:
•   Must the income be payable only as long as the client is alive (nil year term certain)?
•   Must it be a survivor’s income, i.e. payable until the death of the surviving spouse?
•   Must payments be guaranteed for a minimum period even if the client dies prior to the end of term
    (5-, 10- or 15-year term certain)?
•   Must the income remain constant or grow annually?
•   Must the income be paid monthly, quarterly, half-yearly or annually in arrears/in advance?

Single-life annuity without a term certain (Nil year certain life annuities)
The biggest initial income that a client can buy is a single-life annuity without any guarantee term and
without growth after purchase.
The life annuity is payable until the death of the annuitant in all cases (monthly and non-monthly
frequencies). If the annuitant dies prior to date of payment, no further annuity or proportion thereof shall
be paid out. All instalments paid after death will be reclaimed by Sanlam.
We recommend that you advise your client rather to choose one of the other options. It may mean a
slightly lower income, but could bring about better value for money for your client in the long run.
Single-life annuity with a term certain
If your client chooses a single-life annuity we recommend a guarantee term to protect his/her
dependants in the case of prior death. If he/she dies within the guarantee term his/her dependants will
receive the income for the remainder of the guarantee term. This applies to all frequencies.

Joint-life annuity (survivor’s)
Instead of a single-life annuity, your client can select a slightly lower income on his/her life and that of a
dependant (e.g. a spouse).
The following conditions apply:
•   The younger the dependant, the smaller the income (a longer term of payment is expected).
•   If a term certain is not selected, the following apply:
    –   The income is payable only until the death of the survivor, and
    –   if both the annuitants die before a date on which the annuity is payable, no further life annuities
        or proportionate part thereof is payable.




GE 10/2004                                             BJ12
The following possibilities may be considered by the client:

  (i) A joint-life annuity payable up to the death of the survivor.
 (ii) A joint-life annuity which is reduced by a selected percentage at the death of either of the two
      assureds.
 (iii) A joint-life annuity which is reduced by a selected percentage at the death of the husband.
(iv) A joint-life annuity with a term certain. If both annuitants die within the term certain, their
     dependants will receive the income for the rest of the term certain.

If a double-life annuity with a term certain and a percentage reduction at death was selected, and the
assured at whose death the life annuity must be reduced dies, the full life annuity instalment will be paid
till the end of the term certain. After that, the reduced life annuity instalment will be paid.

Growth life annuity (single-life or joint-life)
A growth life annuity (whether single or joint-life) can be selected. It grows at a certain percentage per
year to protect your client’s income against inflation.
Your client selects the growth percentage up to the maximum permitted. The higher the growth rate, the
lower the initial income. However, your client is ensured of better care if he/she lives for a long time
after the life annuity has been purchased. The growth rate may be chosen to one decimal percentage
point, e.g. 5,2% (not 5,25%), up to the current maximum of 7% per annum.

COMPARATIVE EXAMPLES
The following examples can serve as a guide to assist you and your client to decide on the most
appropriate choice. An income of R100 per month in the first example serves as the basis with which all
the other income can be compared. It shows the extent to which the initial income decreases as the
features of the life annuity improve.
Example 1:
   The calculations apply to a male who is 65 when he buys the life annuity. Figures for other ages
      will display the same pattern.
     Choice                                                                       Income per month
     • Constant income payable for as long as the male is alive (no
       guarantee term).                                                                  R100
     • Constant income payable for as long as the male is alive, but
       guaranteed for at least 5 years even if he dies earlier.                           R 98
     • Constant income payable for as long as the male is alive, but
       guaranteed for at least 10 years even if he dies earlier.                          R 94
     • Constant income payable until the death of the survivor in the
       case of a husband and wife, who is 3 years younger than him (no
                                                                                          R 79
       guarantee term).
     • Income which grows at 5% per year, payable for as long as the                     initially:   R42
       male lives (no guarantee term).                                             after 5 years:     R54
                                                                                  after 10 years:     R68
                                                                                  after 15 years:     R87
     • Income which grows at 7% per year, payable for as long as the                     initially:   R31
       male is alive (no guarantee term):                                          after 5 years:     R43
                                                                                  after 10 years:     R61
                                                                                  after 15 years:     R85




GE 10/2004                                             BJ13
At Sanlam, clients are free to select any combination of features. For a married couple, an income
which grows at 5% or 7% per year, payable until the death of the surviving spouse, could be most
convenient. At the death of the first deceased (at the end of the term certain – if applicable), the income
can be reduced by a third or a quarter, after which the pension grows at the chosen rate.

   Example 2:
   The 65-year old male (from the previous example) and his wife aged 62 choose an income with a
   growth rate of 5%. The income decreases by one-third at the death of the first deceased. Whilst
   both are still alive, the payments compared to the income in the previous example will be as follows:
        initially:        R 50
        after 5 years:    R 64
        after 10 years:   R 81
        after 15 years:   R104

The various incomes are all calculated on the same principles, according to the expected periods of
payment. On average one is not better than the other. Your client should choose the one that best suits
his needs.
The relative values may vary slightly form time to time as life annuity rates change. Nevertheless, they
should remain a good guide to help with selection.

TAX: Life annuities
See page BJ5 for full particulars regarding tax.

 AN ANNUITY COMBINED WITH A WHOLE-LIFE POLICY
Instead of your client protecting his dependants by means of a guarantee term or a survivor’s life
annuity, he can select a life annuity without a guarantee term. At the same time he takes out The One
Policy with life cover equal to the consideration of his pension. No proof of assurability is needed. The
premium of the life policy (single-premium policy) is then simply withheld from the purchase sum. The
initial purchase sum is paid out to the heirs at the client's death within the guarantee term of The One
Policy. The remainder of the purchase sum is used to provide a regular income to the client.
This option, known as Plan 24, is available only for optional purchase sums and will be discussed in fully
in Section BK.

For compulsory money, Plan 27 and Plan 28 can be considered. A nil year certain life annuity is
purchased to fund the premium of a whole-life policy, and the balance is used for a guaranteed income
for life. Plan 27 and Plan 28 is fully discussed in Section BK.




GE 2/2006                                            BJ14
                                        BONUS LIFE ANNUITIES



SPECIAL FEATURES
•   The client receives an income which will grow annually at a rate declared by Sanlam. A bonus life
    annuity is specifically designed to increase more or less in line with the inflation rate.
•   At present bonus life annuities are available for compulsory purchases only.

GENERAL INFORMATION
See pages BJ1 to BJ3.
•   Plan code: Plan 2: Single-life annuity
                 Plan 3: Joint-life annuity
•   Term       : Whole-life

SIZE OF BONUS LIFE ANNUITY INSTALMENT
•   The size of the initial income is determined by bonus life annuity rates, which in turn depend
    primarily on the expected term of payment of the income.
•   In contrast to other life annuities, bonus life annuity rates do not depend directly on current long term
    rates. Bonus life annuity rates will therefore be adjusted less often.

GROWTH
All bonus life annuities will grow annually on the policy anniversary at a rate declared by Sanlam.
The declaration will be made with our normal bonus declaration.
The declared growth rate will depend on the investment achievement of the bonus life annuity portfolio.
Growth assets, e.g. shares and properties, which have been a good inflation hedge in the past, will
therefore form an important element of the portfolio.

GUARANTEE
Sanlam guarantees that the bonus life annuity instalment will never be reduced. The growth which is
added to the policy annually can therefore never be withdrawn.

OPTIONS IN THE CASE OF BONUS LIFE ANNUITIES
The client has an option of:
•   An income payable monthly, quarterly, half-yearly or annually in arrears/in advance according to the
    client’s need.
•   A single-life annuity with an income which is payable only as long as the client is alive.
•   A survivor life annuity with an income which is payable, e.g. until the death of the survivor of the
    client and his spouse. In this case, the client has the further option of having the survivor’s income
    reduced by a certain percentage at one of the annuitant's death or that of the first deceased. In such
    a case, the life annuity instalment will be reduced only after the expiry of the term certain (if
    applicable).
•   An income guaranteed for a minimum period even if the client (and co-assured in a survivor life
    annuity) dies soon.
However, the initial choice is permanent and your client cannot change his mind later on.
Note: If the annuitant (or both annuitants with joint-life annuities) dies before a date on which the
       annuity is payable, no further annuity shall be paid – not even a proportional part of the
       annuity.

ILLUSTRATIONS
In Sanlam’s computer quotations we illustrate the future income of a bonus life annuity at two assumed
annual growth rates.

TAX: Bonus life annuities
See page BJ5 for full particulars regarding tax.
GE 10/2004                                            BJ15
                                          PRIVATE PENSION


    BACKGROUND

It is a compulsory life annuity that the fund purchases with an insurer on the member’s life, with the
member as owner. A compulsory term annuity is also available as a private pension.


    FEATURES

•    The Fund is not the owner of the policy. The member himself is the owner.
•    The member or his dependants can propose for a private pension as soon as they become entitled
     to a pension in terms of the rules of the fund in question (pension, provident or RA fund).
•    The fund in question authorises Sanlam Life on the proposal form to make the member (life insured)
     the owner of the policy (life annuity/term annuity).
•    Purchase sums for private pensions arise from death, disability and maturity claims from the Central,
     ABSA and PPS Retirement Annuity Funds and Penkoop Scheme. The Sanlam Preservation
     Provident Fund, Sanlam Preservation Pension Fund, the Central Provident Fund and "compulsory
     money" derived from outside Sanlam also provide purchase sums.


    NOMINEE

It is compulsory for a nominee to be appointed in the case of a private pension (the policy will not be
issued without one).




GE 10/2004                                           BJ16
                               PENSION WITH CAPITAL REPAYMENT



    AT A GLANCE

•    A lifelong, guaranteed income is provided. This income can be level, or it can increase annually at
     a chosen percentage.
•    The life annuity is only available for compulsory purchases for money from pension, provident,
     preservation pension, preservation provident and RA funds. This product is available only if the
     origin of the purchase sum is a death claim, a disability claim or retirement.
•    Switching from this life annuity to ILLA-type life annuities is allowed.
•    The life annuity is available as a single (Plan 5) as well as double life annuity (Plan 6).
•    At the death of the life annuitant (or even survivor in case of Plan 6), an amount equal to the initial
     purchase sum is paid to his or her dependants in 60 monthly instalments payable in arrears.
•    Aside from the commission payable on the lump sum, the intermediary can agree to a service fee
     (trail fee) with the client.

    FURTHER ASPECTS *

    How the product       • The income can be level, or it can increase annually at any rate between
    works                   0% and 7% per year. The growth rate may be chosen to one decimal, e.g.
                            5,2% (not 5,25%). An increase at the inflation rate is not available.
                          • The Pension with Capital Repayment will always have a nil year certain
                            term. The fund’s underlying assets are fixed-interest investments (as in the
                            case of normal life annuities).
                          • At the death of the life annuitant, the payments cease. The purchase sum
                            invested originally is then paid out to the dependants/beneficiaries/
                            nominees (the “claimants”) or the life annuitant’s estate over a period of
                            five years. The 60 instalments are fully taxable and can be commuted on
                            request (on our terms) to the degree allowed in terms of legislation.
                             Legislation stipulates as follows:
                             – Pension fund
                                 If the life annuity has been purchased by a pension fund, the full life
                                 annuity may be commuted within six months of the death of the life
                                 annuitant.
                              –   RA fund
                                  If a life annuity has been purchased by an RA fund, no more than one-
                                  third of the life annuity may be commuted within six months of the
                                  death of the life annuitant. However, should the life annuity be R1 800
                                  or less per year, the full life annuity may be commuted.
                              –   Provident fund
                                  If the life annuity has been purchased by a provident fund, the full life
                                  annuity may be commuted at any time. The six months' restriction then
                                  does not apply.
                          • We insist that a beneficiary/nominee be appointed at the issuing of the
                            original policy, so we can know whom we must pay the instalments to after
                            the death.
    Tax                   • The life annuity instalments are fully taxable.
                          • The 60 instalments, which pay out an amount equal to the initial purchase
                            sum to the claimant(s) after the death of the policyholder, are fully taxable.
                          • No estate duty is payable, unless a lump-sum commutation takes place
                            within six months of the death. No pay-outs will be done for lump-sum
                            commutations before a IRP3 is obtained.
    * Read together with “AT A GLANCE”


GE 10/2004                                             BJ17
  Investment limits   • There is no minimum purchase sum, but the minimum permissible new
                        business limit for life annuity instalments must always be adhered to.
                      • There is no maximum.
  Age at inception    Minimum       : 20 anb
                      Maximum       : 86 anb
  Type of pension     • A member or his or her dependants becomes entitled to a pension
                        according to the rules of a particular pension, provident or RA fund. This
                        normally happens at retirement as a result of old age or disability, and at an
                        early death. Under any of these conditions, the Pension with Capital
                        Repayment can be offered as an option.
                      • The Pension with Capital Repayment is also available as a Private Pension.
  Double life         • The Pension with Capital Repayment is also available as a double life
  annuity (Plan 6)      annuity, and the life annuity instalments are payable until the death of the
                        survivor. Thereafter the 60 instalments are paid as is the case with the
                        single life (Plan 5).
                      • The instalment is not decreased on the death of the first deceased.
  Commission and      Commission       •   The normal commission scales, as for other compulsory
  service fee                              life annuities, are applicable to the full lump sum.
                                       •   Commission will not be reversed, as the policyholder can
                                           not claim his or her lump sum.
                      Service fee      •   The service fee ("trail fee") can be determined between
                                           0% and 0,6% per year, and is based on the original
                                           purchase sum.
                                       •   The fee is paid monthly in arrears.
                                       •   The policyholder can cancel or amend the service fee.
                                           The policy benefits (life annuity instalment) will be
                                           adjusted in such a case. This fee is not regulated by
                                           legislation, and is an exclusive contract between client
                                           and intermediary. It is also possible for the client to
                                           choose another intermediary.
                                       •   As the service fee is a percentage of the purchase sum, it
                                           remains unaltered for as long as it is payable, and would
                                           not increase as a result of any growth in the life annuity
                                           instalments.
                                       •   The net instalment is calculated by deducting tax and the
                                           service fee from the gross instalment. Aside from the
                                           chosen growth in the life annuity instalments (if
                                           applicable), any change in the service fee would therefore
                                           result in an adjustment of the net instalment.
                                       • The service fee is calculated as follows:
                                           Original purchase sum x chosen %          = monthly
                                                          12                           service fee
                                       Payment of       •   The service fee is paid to the intermediary
                                       service fee          monthly in arrears.
                                                        •   The fee will be paid to only one
                                                            intermediary.




GE 10/2004                                       BJ18
  Amendments to        •   An option is offered whereby the client can switch the Pension with Capital
  the policy               Repayment to a non-guaranteed life annuity, such as, for example, ILLA-
                           type products.
                       •   This option only applies if the new life annuity is placed with Sanlam.
                       •   The switch will be done at the market value of the assets of the Pension
                           with Capital Repayment. This will be done by “surrendering” the Pension
                           with Capital Repayment and buying a new pension – no notation will be
                           done.
                       •   Switches to the Pension with Capital Repayment will initially not be
                           accepted, except for switches from ILLA products. This will also be a
                           surrender, and a transfer of the surrender value to the new life annuity
                           fund.
                       •   No other amendments (notations) and surrenders, or partial surrenders on
                           the policy will be allowed.
                       •   No growth rate adjustments are permitted after the policy has been issued.
  Cessions,            •   Cessions are not permitted on any of these policies.
  beneficiaries and
  nominees             •   This applies to the initial life annuity policy, as well as any policy issued at
                           the death of the (surviving) life annuitant. Cessions are also not permitted
                           on a policy which is paid out in 60 instalments, or on the alternative new life
                           annuity for life.
                       •   However, beneficiaries may be nominated at any time on the initial life
                           annuity policy, as well as on the policies taken out after death.
  Table and plan       •   The same table codes as are used today for other life annuities, are used
  codes                    for this product. The relevant table code is derived from the source of the
                           money with which the life annuity is bought.
                       •   The plan codes are Plan 5 (single life annuity) and Plan 6 (double life
                           annuity).
  Payment of           Payment of         • The payment of the 60 instalments at the death of the life
  instalments at the   the 60               annuitant are handled according to the same principle as
  death of the life    instalments          in the case of lump-sum disability benefits (OEP), with
  annuitant                                 the difference that the instalments are taxable in the
                                            hands of the annuitant.
                                          • For the payments to be made, a term annuity policy with
                                            a 5-year term is issued.
                                          Please Note:
                                          • The instalments are payable monthly in arrears.
                                          • If the new annuitant dies within five years, the
                                             instalments do not cease. A new owner must be
                                             appointed.
                       Payment if a       The dependant/beneficiary/nominee can, at the death of the
                       lifelong           life annuitant, request that a lifelong life annuity be
                       income is          purchased on their lives, instead of taking the money in 60
                       required           instalments. The amount that will then be available for this
                                          will, however, not be the initial purchase sum, but will be
                                          equal to the discounted value of the 60 instalments. The
                                          prevailing 5-year annual term annuity rate will be the
                                          discounted rate that will be used.
  Policy at death of   • At the death of a beneficiary/nominee, Sanlam Life continues paying the
  beneficiary/           instalments for the remaining term.
  nominee              • On request, the outstanding payments, in terms of Sanlam Life's conditions,
                         can be commuted to the extent as allowed by legislation.




GE 10/2004                                          BJ19
  Internal transfers   The income instalments of the Pension with Capital Repayment cannot be
  (“other trans-       used to fund recurring premium policies on the new administration system
  fers”) to other      (Stratus policies), or be transferred to unit trusts. They can be used to fund
  policies and unit    recurring premium policies on the old administration system (non-Stratus
  trusts               policies) on condition that the policy being funded complies with all the
                       requirements (e.g. premiums must not be in arrear, policy must be in force,
                       etc.). The reason for this is that Pension with Capital Repayment, as other
                       non-Stratus policies, is administered on the old administration system, and
                       funding across operating systems is not permitted.
                       Should there be transfers to recurring premium policies on the old
                       administration system, no debit order discount will apply in respect of the
                       policies funded in this way. Cash premiums will apply to these policies.
  Administrative       Frequencies       • Only monthly frequency, payable in arrears are available.
  information                            • For the payment of the 60 instalments in the case of
                                           death, the frequency is also always monthly in arrears.
                       Issuing fee       R350,00
                       Policy fee        Life Annuities    : R15,00 per month
                                         Term Annuities    : R11,50 per month
                       Proposal form     AEB42
                       Product name      Pension with Capital Repayment
                       Product name      D121
                       code
                       Quotations        MegKwot and SanQuote




GE 10/2004                                         BJ20
                                                              SECTION BK

                                                       INVESTMENT PLANS


                                                                                                                                  Page
CAPITAL PROTECTION PLAN AT A GLANCE .................................................…                                            BK1
GENERAL INFORMATION ................................................................................….                            BK2
−   MINIMUM LUMP SUM ...............................................................................................….            BK2
−   INFORMATION IN OTHER SECTIONS .....................................................................….                         BK2
−   SECURITY VALUES ................................................................................................……            BK2

CAPITAL RETENTION PLAN : PLAN 24 ............................................................…                                    BK3

− BASIC COMPOSITION ..............................................................................................…               BK3

CAPITAL PROTECTION OPTION : WHOLE LIFE (PLAN 27) ……………………….                                                                       BK4
PLAN 27 AT A GLANCE …………………….…………………………………………………….                                                                                BK4
FURTHER ASPECTS ……………………………….……………………………………………..                                                                                  BK4
− ALLOCATION OF LIFE ANNUITY INSTALMENTS ………………………..………………….                                                                      BK4
−   CALCULATIONS ……………………….…………………………………….……………………                                                                                BK5
−   REVISION ……………………………………………………….…………….…………………..                                                                                BK5
−   FREQUENCIES ……………………………………………………………..…………………….                                                                                BK5
−   AGE AT ENTRY ………………………………………………………..………………………….                                                                               BK5
−   INCEPTION DATES …………………………………………………………..…………………                                                                               BK6
−   EX GRATIA CLAIM ……………………………………………………….…………………….…                                                                              BK6
−   MINIMUM WHOLE-LIFE POLICY PREMIUM AND LIFE ANNUITY INSTALMENT ..…….                                                           BK6
−   TYPE OF COMPULSORY MONEY SUITABLE AS PURCHASE SUM ………..……………                                                                  BK6
−   PRIVATE PENSION …………………………………….……………………………………….                                                                               BK6
−   COMPULSORY AND OPTIONAL MONEY ………………………………………..………….                                                                          BK6
−   COMMISSION …………………………………………..…………………………………………                                                                                 BK6
−   AMENDMENTS …………………………………………….……………………………………..                                                                                 BK7
−   SURRENDER VALUE ...............................................................................................…..            BK7
−   CESSIONS ...............................................................................................................…..   BK7
−   TRANSFERS TO OTHER POLICIES (“OTHER TRANSFERS”) ………..…………………..                                                                BK7
−   TABLE AND PLAN CODES ……………………………..……………………………………….                                                                            BK7
−   ADMINISTRATIVE INFORMATION ………………………………….………………………….                                                                          BK7


                                                                                                                                  2/…




GE 2/2006                                                                BK
                                                                         -2-
                                                                                                                                      Page
CAPITAL PROTECTION OPTION : CHOSEN TERM (PLAN 28) ..……………...…….                                                                       BK8
PLAN 28 AT A GLANCE ………………….…………………………………………………                                                                                       BK8
FURTHER ASPECTS ………………………………………………………………………..                                                                                         BK8
−   ALLOCATION OF THE LIFE ANNUITY INSTALMENTS …………………………………..….                                                                      BK8
−   CALCULATIONS …………………..…………………………………………………….………….                                                                                  BK9
−   REDUCTION OF THE DEATH BENEFIT ………………………………………………………..                                                                            BK9
−   LEVEL COVER TERMS AVAILABLE …………………………………….………………….……                                                                             BK9
−   FREQUENCIES ……………………………………………………..…………………………....…                                                                                 BK9
−   AGE AT ENTRY ………………………………………………………………………………..……                                                                                   BK9
−   INCEPTION DATES …………………………………………………………………………………                                                                                   BK9
−   EX GRATIA CLAIM …………………………………………..……………………………………..                                                                                BK9
−   MINIMUM POLICY PREMIUM AND LIFE ANNUITY INSTALMENT ……………………..……                                                                   BK10
−   TYPE OF COMPULSORY MONEY SUITABLE FOR PURCHASE SUM ……………………..                                                                     BK10
−   PRIVATE PENSION ……………………………………………………..…………….……………                                                                                 BK10
−   COMPULSORY AND OPTIONAL MONEY …………………………………..…………………..                                                                            BK10
−   COMMISSION …………………………………………………………………………………….…                                                                                     BK10
−   AMENDMENTS ………………………………………………………………………………….…..                                                                                    BK10
−   COOLING-OFF PERIOD …………………………………………………………………………...                                                                                BK10
−   SURRENDER VALUE .....................................................................................................…            BK11
−   CESSIONS .....................................................................................................................…   BK11
− TRANSFERS TO OTHER POLICIES (“OTHER TRANSFERS“) .……………………………..                                                                      BK11
−   TABLE AND PLAN CODES ……………………………………………….……………………….                                                                                BK11
−   ADMINISTRATIVE INFORMATION ……………………………………………………….…....…                                                                           BK11




GE 2/2006                                                                 BK
                                     INVESTMENT PLANS


                      CAPITAL PROTECTION PLANS AT A GLANCE

Choices     •   Plan 24 :   Capital Retention Plan
available
            •   Plan 27 :   Capital Protection Option : Whole life (the client is provided with a
                            guaranteed, level income for life, cover is guaranteed for life)
            •   Plan 28 :   Capital Protection Option : Chosen Term (guaranteed lifelong income is
                            provided to the client, cover is guaranteed for the level cover term and
                            is reduced thereafter annually, but never below 25% of the original
                            cover amount)
Inception   Please see Section AA for full particulars.
date

Age at      Plan 24 (optional)         : 15 to 90 anb
entry       Plan 27 (compulsory)       : 1 to 80 anb
            Plan 28 (compulsory)       : 15 to 70 anb
Benefit     Plan 24                    : Lifelong
term        Plan 27                    : Lifelong
            Plan 28                    : Lifelong

            NB: Plan 27 and Plan 28 are available only for compulsory money, that is if the
                origin of the purchase sum is a death claim, a disability claim or retirement.
Maturity    There is no limit on the age at maturity, only on the term.
age
Proposal    Plans 24, 27 and 28        : Form AEB42
form




GE 2/2006                                      BK1
                          INVESTMENT PLANS: GENERAL INFORMATION



MINIMUM LUMP SUM

PLAN 24

There is no fixed minimum lump sum as applies in the case of single-premium policies. The minimum
amount that may be invested must, however, be sufficient to supply the following normal minimum
amounts:
•    The minimum life annuity instalment.
•    This instalment in turn must provide adequately for payment of the minimum premium of the life
     policy.
•    If the investment policy is a single-premium policy, the portion of the capital sum that is invested in the
     single-premium policy must not be less than R2 500 (the normal minimum single premium of R10 000
     does not apply to these policies).

PLAN 27 AND PLAN 28

R20 000 (for both level and increasing income plans)

No minimum initial policy premium or minimum life annuity payments apply to Plans 27 and 28.


    INFORMATION IN OTHER SECTIONS (in alphabetical order)

•    Income tax : Section BJ
•    Inception date and rate date : investments emanating from death and disability claims - Section AA
•    Non-capital portion (calculation) : Section BJ
•    Instalments (calculation) : Section BJ
•    Rates for each day of a month : Section BJ
•    Advanced guarantee of rates : Section AA


    SECURITY VALUES

COLLATERAL CESSION
Investment plans that originate from optional money can all be offered as collateral security for a loan.
The cash value of an optional life annuity decreases as the instalments are paid out. At the same time
the investment policy’s cash value increases as it receives premiums and earns investment bonuses or
return. It is therefore essential that the two contracts be offered jointly as security.
According to the Commissioner for the South African Revenue Services, a security cession applied in
such a case, will not affect the exemption as regards the capital element in terms of Section 10A.

CASH VALUES (Surrender value)

The cash value of an optional life annuity at early termination is not guaranteed. At any time, the cash
value is determined by Sanlam Life with due consideration to current interest rates. This could mean a
capital profit or loss. Optional life annuities can be surrendered for as long as Sanlam Life’s practice of
allowing it remains unchanged and is subject to the restriction that applies during the first 5 years. The
life annuity cannot be surrendered on its own.




GE 2/2006                                             BK2
                                CAPITAL RETENTION PLAN : PLAN 24

The Capital Retention Plan offers the maximum guaranteed life-long income with repayment of capital at
death within the guarantee term. Instead of buying a life annuity that is guaranteed for a certain term
only, the client buys a life annuity that is payable until his death, together with a policy that ensures that
the capital amount remains intact for his estate or dependants in the event of his death within the
guarantee term.

    BASIC COMPOSITION
A life policy and a special nil-years certain life annuity are used.

THE LIFE ANNUITY
Plan 24 is available only for optional purchases.
•    A portion of the purchase sum is used as a single premium for a whole-life policy of which the cover
     is equal to the total purchase sum (the investment amount).
•    The balance of the total purchase sum provides a lifelong monthly or annual income which ceases at
     death.
The Capital Retention Plan therefore offers:

•    An income guaranteed for life.

•    A policy (without proof of assurability) that ensures that the original purchase price is again available
     for dependants or the estate in the event of the assured’s death. This guarantee applies for the full
     duration of the guarantee term.

THE LIFE POLICY
A single premium life policy (Table 401/501) with maximum cover is used throughout. The capital is
therefore protected at a relatively cheap premium. The initial death benefit of the policy is equal to the
capital sum invested and no proof of assurability is therefore necessary - provided the annuitant and the
assured are the same person.
A portion of the lump sum will be used to fund the with-cover single-premium policy. The balance of the
capital amount is used to provide the client with a monthly or annual income for life.




POLICIES
Investment policy, a single-premium policy
Two policies, each with a policy number, are issued, namely:
    –    the life annuity policy, and
      –    the policy for the life cover (Table 401 or 501).


GE 2/2006                                            BK3
                   CAPITAL PROTECTION OPTION : WHOLE LIFE (PLAN 27)



                                         PLAN 27 AT A GLANCE



•   The client is provided with a guaranteed income for life. The income can be level or it can increase
    by a chosen percentage on the policy anniversary each year.

•   The original purchase sum is guaranteed at death.

•   The life cover is guaranteed for life.

•   Only one nil-year-certain life annuity is purchased which funds the premium on a whole-life policy,
    with the balance being used to provide a guaranteed income for life.

•   The premiums of whole-life policies are equal to the risk premiums. As cover becomes more
    expensive, the premium of the policy increases. The life annuity component by means of which this
    premium is funded, will provide the increasing life annuity which funds this premium. Because only
    risk premiums are recovered, the initial premium is considerably cheaper than with other policies.
    The premium is level for the first five years, after which it increases annually on the policy
    anniversary.

•   Commission is paid on the first year’s annual premium.

•   The product is available only for compulsory money, that is if the origin of the purchase sum is a
    death claim, a disability claim or retirement.



                                             FURTHER ASPECTS



    ALLOCATION OF LIFE ANNUITY INSTALMENTS

•   The life annuity always has a nil-year certain term and is always a single-life life annuity.

•   The full gross instalment is taxed before being split between a premium for the life policy and income
    to the life annuitant. The premium and income are therefore paid from after-tax money. The life
    annuitant receives a tax certificate in respect of the full gross instalment.

•   With the whole-life policy, the premium is equal to the risk premium only.           No other costs are
    deducted from this part of the life annuity.

•   A portion of the life annuity provides an increasing instalment with which the premiums of the whole-
    life policy are paid.

•   The balance provides an instalment that is paid each month as a monthly income to the life
    annuitant. The instalment can be level or it can increase at a chosen growth rate between 0% and
    7% per annum. The growth rate may be chosen to one decimal percentage point, e.g. 5,2% (not
    5,25%).

•   If the whole-life policy is terminated, it has no surrender value. However, the full increasing income
    of the life annuity installment is payable to the policyholder.




GE 2/2006                                           BK4
    CALCULATIONS

PREMIUM ON WHOLE-LIFE POLICY

•   No fees are taken into account in calculating the part of the purchase sum required for the policy
    premium.
•   Once provision has been made for tax each month, the available premium is equal to the cost of the
    death benefits.

CALCULATION OF THE NET INCOME
Once the policy premium – and therefore the part of the purchase sum needed for this – has been
calculated, the balance of the purchase sum is used to calculate the income instalment.

CALCULATION OF TAX

•   The client’s attention must be drawn to the fact that the taxable amount increases every year owing
    to the increasing life annuity portion which generates the premium, as well as the increasing income
    (if applicable).
•   The calculation of the tax always takes into account that the life annuity in any case starts increasing
    after a certain period (to pay for the policy premiums).

DEBIT ORDER DISCOUNT
None.

FEES

•   There is an initial fee of R350,00 on the part of the purchase sum that is used to calculate the
    monthly income.
•   A policy fee of R15,00 p.m. is used when calculating the monthly income.
•   There are no fees on that part which is used for the whole-life policy premium.


    REVISION

No revision is applicable to the life policy.


    FREQUENCIES

Only monthly frequencies for both the whole-life policy premium and the income.


    AGE AT ENTRY

Minimum : 15 next birthday
Maximum : 80 next birthday




GE 2/2006                                          BK5
    INCEPTION DATES

•   The date of payment of the purchase sum determines the inception date of the life annuity. The life
    annuity must always be payable monthly in arrear.
•    The inception date of the life policy is one month later than the inception date of the life annuity. The
     first instalment payable monthly in arrear therefore funds the life policy and provides the first income.


    EX GRATIA CLAIM

If a claim arises in the period between the date on which the purchase sum was paid and the inception
date of the life policy, we pay the policyholder an ex gratia claim for an amount equal to the full purchase
sum.


    MINIMUM WHOLE-LIFE POLICY PREMIUM AND LIFE ANNUITY INSTALMENT

•   The minimum purchase sum is R20 000 for both a level and an increasing income.
•   There is no minimum initial policy premium or minimum life annuity instalment for this product.


    TYPE OF COMPULSORY MONEY SUITABLE AS PURCHASE SUM

A member or his dependants become entitled to a pension in terms of the rules of a pension, provident
or RA fund. This normally happens at retirement as a result of age, or at disability or prior death. If any
of these conditions applies, a Plan 27 can be offered as an option.


    PRIVATE PENSION

Plan 27 is also available as a Private Pension.


    COMPULSORY AND OPTIONAL MONEY

•   Plan 27 is available only for compulsory money.
•   There is currently a single-premium variation (the life policy is a whole-life single-premium policy)
    available for optional funds. The plan code is Plan 24.


    COMMISSION

COMMISSION ON THE WHOLE-LIFE POLICY PREMIUM

•   Regulation commission is paid up front as usual, as first-year and second-year commission. Both
    first- and second-year commission are calculated on the first year’s annual premium, and
    commission is calculated as for a whole-life policy.
•   No commission is paid on the contractual premium increases.


COMMISSION ON THE LIFE ANNUITY POLICY
Normal commission is paid on the life annuity.




GE 2/2006                                           BK6
    AMENDMENTS

CHANGE IN TAX RATE

•    If the policy has already been issued and the life annuitant should request that the tax rate be
     changed, this can be done, but the net income will change.
•    Any change in the tax rate, or changes to tax rebates, for example, will bring about an associated
     change in the net income.

AMENDMENTS TO THE POLICY

No amendments (notations) are allowed on the policies.


    SURRENDER VALUE

None


    CESSIONS

•    Plan 27 may not be ceded as a unit. The life policy (table 51N) may be ceded, but the life annuity
     (that is purchased with compulsory money) may not be ceded.
•    Collateral and outright cessions of the life policy are permissible.


     TRANSFERS TO OTHER POLICIES (“OTHER TRANSFERS”)

The income instalments from the Plan 27 can be used to fund other recurring premium policies, or be
transferred to unit trusts.


     TABLE AND PLAN CODES

The plan code is a Plan 27 and the table codes are as follows:
•    the table code of the life policy: table 51N
•    the table code of the life annuity can be any of the following : FA0, FA1, FA2, FA3 or FA4. The table
     code depends on the source of the funds (e.g. a retirement annuity or a pension).


    ADMINISTRATIVE INFORMATION


    Proposal form               AEB42

    Product name code           F100

    Quotations                  •   MegKwot and SanQuote
                                •   No special quotations

    Surrender value             None




GE 8/2006                                            BK7
                CAPITAL PROTECTION OPTION : CHOSEN TERM (PLAN 28)



                                         PLAN 28 AT A GLANCE


•   The client is provided with a guaranteed, lifelong income. This income can be level, or can increase
    by a chosen percentage annually on policy anniversary.
•   The death benefit is equal to the purchase sum and is guaranteed for the duration of the chosen
    level cover term. At the end of the level cover term, the death benefit will decrease annually by 10%,
    but never below 25% of the initial death benefit.
•   Only one nil years certain life annuity is purchased which funds the policy premium of a whole-life
    policy, and the balance is used for a guaranteed lifelong income.
•   The premiums of the whole-life policy will remain level for life.
•   The product is available for compulsory money only; that is, if the origin of the purchase sum is a
    death claim, disability claim or retirement from a retirement fund.




                                           FURTHER ASPECTS


    ALLOCATION OF THE LIFE ANNUITY INSTALMENTS

•   The life annuity always has a nil years term certain and is always a single-life life annuity.
•   The full gross instalment is taxed before it is divided between a premium for the whole-life policy and
    income to the life annuitant. The life annuitant receives a tax certificate in respect of the full gross
    instalment.
•   A portion of the life annuity provides a level instalment with which the premiums of the whole-life
    policy are paid.
•   The balance provides an instalment that is paid as a monthly income to the life annuitant. This
    instalment could be level, or it could increase by a chosen growth rate of between 0% and 7% a
    year. The growth rate may be chosen up to one decimal percentage, e.g. 5,2% (not 5,25%).
•   The whole-life policy will have no surrender value.




GE 8/2006                                           BK8
    CALCULATIONS

CALCULATION OF THE NET INCOME

After the policy premium – and thus the portion of the purchase needed for this – has been calculated,
the balance of the purchase sum will be used to calculate the income instalment.

DEBIT ORDER DISCOUNT

None.

FEES

•    There is an initial fee R350,00 on the portion of the purchase sum that is used to calculate the
     monthly income.
•    A policy fee of R15,00 a month is used with the calculation of the monthly income.
•    There are no other fees on the portion that is utilised for the whole-life policy premium.


    REDUCTION OF THE DEATH BENEFIT

The death benefit amount will remain unchanged for the duration of the chosen level cover term. At the
end of the level cover term, and on each policy anniversary after that, this amount will be reduced
annually by 10%. However, the death benefit will never decrease to an amount of less than 25% of the
initial death benefit.


    LEVEL COVER TERMS AVAILABLE

Any term from 10 up to and including 20 years may be chosen.


    FREQUENCIES

Only monthly frequencies for both the whole-life policy premium and the income.


    AGE AT ENTRY

    Minimum      :   15 next birthday
    Maximum      :   70 next birthday


    INCEPTION DATES

•    The date of payment of the purchase sum determines the inception date of the life annuity. The life
     annuity must always be payable monthly in arrear.
•    The inception date of the whole-life policy is one month later than the inception date of the life
     annuity policy. The first monthly instalment payable in arrear will then fund the whole-life policy, and
     will also provide the first income.


    EX GRATIA CLAIM

Should a claim arise in the period between the date on which the purchase sum has been paid and the
inception date of the whole-life policy, we will pay out an ex gratia claim to the policyholder for an amount
equal to the full purchase sum.




GE 8/2006                                           BK9
    MINIMUM POLICY PREMIUM AND LIFE ANNUITY INSTALMENT

•   The minimum purchase sum for both a level and an escalating income is R20 000.
•   There is no minimum initial policy premium or minimum life annuity instalment for this product.


    TYPE OF COMPULSORY MONEY SUITABLE FOR PURCHASE SUM

A member or his dependants will become entitled to a pension in term of the rules of a relevant pension,
provident or RA fund. This normally happens at retirement owing to age, or at disability, and at early
death. In the case of any of these events, a Plan 28 can be offered as option.


    PRIVATE PENSION

Plan 28 is also available as a Private Pension.


    COMPULSORY AND OPTIONAL MONEY

•   Plan 28 is available for compulsory money only.
•   At present, a single-premium variation (the life policy is a whole-life single-premium policy) is
    available for optional money. The plan code is Plan 24.


    COMMISSION

COMMISSION ON THE WHOLE-LIFE POLICY PREMIUM

As usual, regulation commission is paid as first- and second-year commission at commencement (up
front). Both first- and second-year commission are calculated on the annual premium, and commission
is calculated as for a whole-life policy.

COMMISSION ON THE LIFE ANNUITY POLICY

Normal commission is paid on the life annuity.


    AMENDMENTS

CHANGE IN TAX RATE

•   Should the policy already have been issued and the life annuitant requests that the tax rate must be
    changed, this can be done, but the net income will change.
•   Any change in the tax rate, or amendments to, for instance, the tax rebates, will cause an
    accompanying change in the net income.

AMENDMENTS TO THE POLICY

No amendments (notations) are allowed on the policy.


    COOLING-OFF PERIOD

With Plans 24 and 27 (with compulsory money) as well as Plan 28 there are no cooling-off period.




GE 8/2006                                         BK10
    SURRENDER VALUE

None.


    CESSIONS

•    Plan 28 may not be ceded as a unit. The life policy (table 51AN) may be ceded, but the life annuity
     (purchased with compulsory money) may not be ceded.
•    Collateral and outright cessions of the life policy are permissible.


    TRANSFERS TO OTHER POLICIES ("OTHER TRANSFERS")

The income instalments of the Plan 28 can be used to fund other recurring premium policies, or to be
transferred to unit trusts.


    TABLE AND PLAN CODES

The plan code is a Plan 28, and the table codes are as follows:

•    The table code of the life policy: table 51AN.
•    The table codes of the life annuities can be any one of the following: FA0, FA1, FA2, FA3 of FA4.
     The table code depends on the source of the money (e.g. a retirement annuity or a pension).


    ADMINISTRATIVE INFORMATION

    Proposal form               AEB42

    Product name code           F101

    Quotations                  •   MegKwot and SanQuote
                                •   No special quotations
    Surrender value             None




GE 8/2006                                             BK11
                           SECTION BL


                      STRUCTURED PRODUCTS


                                                       Page
ALSI 40 HIGHEST LEVEL LOCKER ……………………………………………..       BL2
INTERNATIONAL ROLLING GUARANTEE INVESTMENT …………………..   BL3
ESCALATING GUARANTEE INVESTMENT …………………………………….        BL1




GE 6/2005                       BL
                        CHAPTER 1


              ESCALATING GUARANTEE INVESTMENT



                                                   Page

FEATURES OF THE PRODUCT …………………………………………………..      BL1/1
REMUNERATION OF INTERMEDIARY ………………………………………….     BL1/1
NO INCOME PLAN …………………………………….……………………………          BL1/1
AVAILABILITY OF PRODUCT ………………………………………….…………      BL1/1
MINIMUM SINGLE PREMIUM ………………………………………………..……      BL1/1
MINIMUM GUARANTEED MATURITY VALUE ………………………………….   BL1/2
TERM ………………………………………………………………………….………              BL1/2
MODE OF PAYMENT AND FREQUENCY ………………………………….…...   BL1/2
INCEPTION DATE ……………………………………………………..……………         BL1/2
POLICY CHARGES ………………………………………………………………….          BL1/2
DEATH BENEFIT ………………………….…………………………………………          BL1/2
INVESTMENT GUARANTEE ……………………………………………………….        BL1/3
CAP ………………………………………………………………………...………….            BL1/3
NOMINEE FOR POLICY-OWNERSHIP …………………………..………………    BL1/3
CESSIONS ……………………………………………………………………………             BL1/3
COOLING-OFF PERIOD ………………………………………….………………..       BL1/3
CASH WITHDRAWALS …………………………………………………………….          BL1/3
LOANS ………………………………………………………………………………..             BL1/4
CONTINUATIONS …………………………………………………………………..          BL1/4
ADMINISTRATIVE INFORMATION ……………………………………….………     BL1/4




GE 6/2005                   BL1
                                                CHAPTER 1


                                ESCALATING GUARANTEE INVESTMENT


The Escalating Guarantee Investment offers clients the opportunity to invest on the JSE Securities
Exchange without the risks that are usually associated with equity investments. This is a safe product
with the potential to provide good returns too – it is therefore extremely suitable for today's volatile
markets.


    FEATURES OF THE PRODUCT

The Escalating Guarantee Investment is a five-year single-premium sinking fund policy. The policy's
proceeds are linked directly to the Top40 Index of the JSE Securities Exchange and are subject to the
following:

•   The growth vests each year on the policy anniversary and – subject to the policy charges that are
    deducted – will not be less than nil in any policy year, even if the Top40 index drops over the policy
    year.
•   The growth over any policy year is limited to a contractual cap that is determined when the policy is
                                                                                th
    taken out. This rate will be adjusted from time to time (usually on the 26 of each month) for new
    business.
•   If the value of the index at the end of a policy year is lower than that at the beginning of the policy
    year, the fund value of the policy will be reinstated so that the value is again equal to the value as at
    the beginning of the year, less the fund charge. The policy will then immediately share again in any
    market recovery.

    REMUNERATION OF INTERMEDIARY

Commission is equal to 3% of the single premium. If the commission is cut, the allocation percentage
will increase by the same percentage as that by which the commission is cut. If no commission
percentage is indicated on the proposal form the proposal will be issued according to the commission
percentage that appears on the quotation.

    NO INCOME PLAN

The Escalating Guarantee Investment is available only for capital growth. No income plan is available.
If income is required, a five-year term annuity can be purchased to provide the required income. The
rest of the capital is then invested in the Escalating Guarantee Investment.


    AVAILABILITY OF PRODUCT

The product is available for:

•   Individuals
•   Tax-exempt institutions
•   Trusts, where all the beneficiaries are natural persons and/or tax-exempt institutions.

The product is not available to tax-paying institutions.


    MINIMUM SINGLE PREMIUM

R50 000

Ad hoc single premiums cannot be added after the policy has been issued.




GE 6/2005                                             BL1/1
    MINIMUM GUARANTEED MATURITY VALUE

The maturity value is guaranteed not te be less than the single premium.


    TERM

Only a five-year term is available.


    MODE OF PAYMENT AND FREQUENCY

Only single premiums (optional money) are permitted. Compulsory money cannot be used for the
investment.


    INCEPTION DATE

The inception date is always the first day of a month.

The inception date is determined according to the date on which the lump sum has been paid in at the
bank:

•
                                                                           th
    If the money has been paid in from the first up to and including the 25 of a month, the inception
    date is the first of the next month.
•   If the money has been paid in after the 25th of a month, the inception date is the first of the month
    following the next month.

After the policy has been issued, Sanlam Life will add, as growth to the policy, any interest on the
premium from the payment date to the inception date.


    POLICY CHARGES

No initial charges are deducted from the single premium. At least 100% of the single premium is
invested for the client.

The following charges are deducted from the policy:

•   A fund charge is deducted annually from the value of the fund. The fund charge is as follows:
       −    1,45% per annum for single premiums more than or equal to R50 000, but less than
            R500 000.
       −    1,3% per annum for single premiums more than or equal to R500 000, but less than
            R1 million.
       −    1% per annum for single premiums of R1 million or more.
•   Capital gains tax, at present 7,5% of the investment growth, is deducted at maturity or when the
    policy is surrendered. This only applies to individuals or trusts where all the eventual beneficiaries
    are natural persons.

    DEATH BENEFIT

No death benefit or death guarantee is involved. Because it is a sinking fund policy, no life insured is
involved. When taking out the policy, the policyholder (if an individual) must appoint a nominee for
policy-ownership. If the policyholder dies before the end of the policy term and the nominee accepts the
appointment, he or she becomes the new policyholder. The nominee can then decide to continue with
the policy until the end of the term, or to surrender the policy (full cash withdrawal).




GE 6/2005                                           BL1/2
    INVESTMENT GUARANTEE

The investment guarantee involves the following:

•    The growth vests each year and (subject to the policy charges that are deducted) will never be less
     than nil.
•    The original single premium is guaranteed at the end of the policy term.


    CAP

It is the maximum growth (before policy charges) that can be earned on the policy in any policy year.
The cap is set contractually and applies for the full term of the policy. This rate can be adjusted from
time to time for new business and depends on interest rates and market conditions.

The cap could also fluctuate in relation to the payment date. Therefore, if a quotation has been obtained
and the money is not paid in on the date entered on the computer, a new quotation with the correct
payment date must be obtained.


    NOMINEE FOR POLICY-OWNERSHIP

If the policyholder is an individual, he or she must appoint a nominee for policy-ownership when the
policy is taken out. More than one nominee may be appointed. If no nominee has been filled in on the
proposal form, the proposal will be referred back to the intermediary.


    CESSIONS

Outright cessions and collateral cessions are available.

Outright cessions:

The policy may not be ceded outright to a tax paying institution. If the tax status of the cessionary differs
from that of the cedent, the cessionary's values could differ from those of the cedent.

Collateral cessions:

The tax status of the cessionary has no influence on the policy.


    COOLING-OFF PERIOD

Owing to the nature of the assets underlying the investment, the policy cannot be cancelled.             No
cooling-off period therefore applies.


    CASH WITHDRAWALS

A full cash withdrawal can be done after a six-month waiting period. Partial cash withdrawals cannot be
done. The Escalating Guarantee Investment is an illiquid investment. This means that the cash value
at early termination can be significantly lower than the single premium.




GE 6/2005                                            BL1/3
  LOANS

No loans are available.


 CONTINUATIONS

At the end of the policy term the policyholder can decide to continue the policy in the Escalating
Guarantee Investment or in Stratus. If the policyholder chooses to continue the investment in the
Escalating Guarantee Investment, the term will again be five years.


 ADMINISTRATIVE INFORMATION

 Proposal form            AEB39
 Product name code        G006
 Quotations               Quotations are not available on SanQuote. It must be requested from
                          Product Advice on 021 916 3082. Quotations are also available at advisors
                          and marketing consultants.




GE 8/2006                                       BL1/4
                          CHAPTER 2


                 ALSI 40 HIGHEST LEVEL LOCKER



                                                     Page

HOW THE PRODUCT WORKS ………………………………………..…………..        BL2/1
BENEFITS OF THE INVESTMENT …………………………………..……………      BL2/1
REMUNERATION OF INTERMEDIARY ……………………….………………….      BL2/1
NO INCOME PLAN …………………………………………………………….……            BL2/1
AVAILABILITY OF PRODUCT ………………………………………….…………        BL2/2
MINIMUM SINGLE PREMIUM ……………………………………………………..        BL2/2
AGE AT ENTRY ………………………………………….………………………….            BL2/2
MINIMUM GUARANTEED MATURITY VALUE ……..………………….……….   BL2/2
TERM ………………………………………………………………………….………                BL2/2
MODE OF PAYMENT AND FREQUENCY …………………………………..…..     BL2/2
INCEPTION DATE ………………………………………………..…………………           BL2/2
POLICY CHARGES …………………………………………………………………             BL2/3
DEATH BENEFIT ……………………………………………………………………             BL2/3
INVESTMENT GUARANTEE ………………………………………………….…..         BL2/3
CAP ……………………………………………………….…………………………..               BL2/3
NOMINEE FOR POLICY OWNERSHIP ……………………………..……………      BL2/3
CESSIONS ……………………………………………………………………………               BL2/4
COOLING-OFF PERIOD ……………….…………………………………………..         BL2/4
CASH WITHDRAWALS …………………………………………………………….            BL2/4
LOANS ………………………………………………………………………………..               BL2/4
CONTINUATIONS …………………………………………………………………..            BL2/4
ADMINISTRATIVE INFORMATION ……………………………………………….       BL2/4




GE 6/2005                     BL2
                                              CHAPTER 2


                                ALSI 40 HIGHEST LEVEL LOCKER


The ALSI 40 Highest Level Locker is an exciting variation of the Escalating Guaranteed Investment.
The differences between these two products are mainly the term of the investment, the fact that growth
in the case of the ALSI 40 Highest Level Locker is locked in each month, smaller minimum single
premium and the way Sanlam Life will recover policy charges.


    HOW THE PRODUCT WORKS

•   The ALSI 40 Highest Level Locker is a lump sum investment with a six-year term.
•   The minimum investment amount is R50 000.
•   A total of 100% of the investment amount is invested – this means there are no upfront charges.
•   The level of the JSE Top 40 Share Index is recorded at monthly intervals from the inception date for
    the term of the investment.
•   The highest of these monthly levels are used to determine the growth over the term of the
    investment. This means that positive growth is locked in monthly and cannot be reduced by
    subsequent negative growth.
•   The growth on the investment is capped at a predetermined maximum over the term of the
    investment.
•   Policy charges (a fund charge and capital gains tax) are deducted when the maturity or surrender
    value is determined.
•   The minimum guaranteed maturity value equals the initial investment amount.
•   The investment can be surrendered before the maturity date. However, in this event, all guarantees
    will be lost and the surrender value will be paid. This will be less than the value locked in and may
    be less than the investment amount.
•   On the maturity date, investors will have the option of switching into a fund, or range of funds, that
    Sanlam makes available at the time.


    BENEFITS OF THE INVESTMENT

•   Investors will receive a guaranteed minimum maturity value equal to the initial investment amount.
•   Growth is based on the growth of the 40 largest companies listed on the JSE Securities Exchange.
•   Positive growth is locked in at monthly intervals. This means that growth in early years will not be
    affected by possible poor market performance in later years. It also means the investor will not lose
    out on possible short-term bull runs that could be experienced by similar products with longer
    intervals.

    REMUNERATION OF INTERMEDIARY

Commission is equal to 3% of the investment amount. If the commission is cut, the allocation
percentage will increase by the same percentage by which the commission is cut. If no commission
percentage is indicated on the proposal form, the proposal will be issued according to the commission
percentage that appears on the quotation.

    NO INCOME PLAN

The ALSI 40 Highest Level Locker is available for capital growth only. No income plan is available. If
income is required, a term annuity with a term of six years may be purchased to provide the required
income. The rest of the capital is then invested in the ALSI 40 Highest Level Locker. This means that
two separate policies must be taken out.




GE 6/2005                                           BL2/1
    AVAILABILITY OF PRODUCT

This product is available to:

•    Individuals
•    Trusts, where all the eventual beneficiaries are natural persons.

The product is not available to institutions (tax paying or tax-exempt).

    MINIMUM SINGLE PREMIUM

R50 000

No ad hoc lump sum can be added after issuing.

    AGE AT ENTRY

Minimum       : 1 age next birthday
Maximum       : 90 age next birthday


    MINIMUM GUARANTEED MATURITY VALUE

The maturity value is guaranteed not to be less than the investment amount.


    TERM

Only a term of 6 years is available.

    MODE OF PAYMENT AND FREQUENCY

Only lump sums (optional money) are permitted.           No compulsory money may be allocated for the
investment.

    INCEPTION DATE

The inception date is always on the first day of a month.

The inception date is determined in accordance with the date on which the investment amount is paid in
at the bank:

•
                                                                      th
     If the money is paid in from the first up to and including the 25 of the month, the inception date is
     the first of the following month.
•
                                        th
     If the money is paid in after the 25 of the month, the inception date is the first of the month following
     the next month.

Sanlam Life will add interest on the investment amount from payment date to inception date as growth
to the investment after the policy has been issued.




GE 6/2005                                             BL2/2
    POLICY CHARGES

No initial charges are deducted from the investment amount and at least 100% of the investment
amount is invested for the client.

The following charges are deducted from the investment:

•    A fund charge is deducted from the value of the fund when the maturity or cash value is determined.
     At present, the fund charge is as follows:
        −   1,45% per annum for investment amounts more than or equal to R50 000, but less than
            R500 000.
        −   1,3% per annum for investment amounts more than or equal to R500 000, but less than
            R1 million.
        − 1% per annum for investment amounts of R1 million or more.
     Sanlam Life receives a total fund charge at maturity or early termination equal to the number of
     years since the inception date, times the fund charge.
•    Capital gains tax, presently 7,5% of the investment growth, is deducted at maturity or when the
     investment is surrendered. This only applies to individuals (natural persons).

    DEATH BENEFIT

No death benefit or guarantee at death is applicable. Because it is a sinking fund policy, there is no life
insured. When taking out the investment, the policyholder (if an individual) must appoint a nominee for
policy ownership. If the investor dies before the end of the policy term and the nominee accepts the
appointment, he or she becomes the new policyholder. The nominee can then decide to continue with
the investment until the end of the term, or to surrender the investment (full cash withdrawal).


    INVESTMENT GUARANTEE

The investment quarantee comprises the following:

•    The growth vests each month and will – subject to the policy charges being recovered – never be
     less than nil.
•    The original investment amount is guaranteed back at the end of the policy term.

    CAP

The growth over the policy term is limited to a contractual cap.

The cap is set contractually and applies for the full term of the investment. This rate can be adjusted
from time to time for new business and depends on interest rates and market conditions.

The cap could also fluctuate in relation to the payment date. Therefore, if a quotation has been obtained
and the money is not paid in on the date entered on the computer, a new quotation with the correct
payment date must be obtained.

    NOMINEE FOR POLICY OWNERSHIP

If the policyholder is an individual, he or she must appoint a nominee(s) for policy ownership when the
investment is taken out. If no nominee has been filled in on the proposal form, the proposal will be
referred back to the intermediary.




GE 6/2005                                            BL2/3
  CESSIONS

Outright cessions and collateral cessions are available.

Outright cessions:

The policy may not be ceded outright to a tax paying institution. If the tax status of the cessionary differs
from that of the cedent, the cessionary's values could differ from those of the cedent.

Collateral cessions:

The tax status of the cessionary has no influence on the policy.

  COOLING-OFF PERIOD

Owing to the nature of the assets underlying the investment, the investment cannot be unilaterally
cancelled. No cooling-off period therefore applies.

  CASH WITHDRAWALS

A full cash withdrawal can be made after a waiting period of six months. No partial cash withdrawals
can be made. The ALSI 40 Highest Level Locker is an illiquid investment, in other words the cash value
at early termination can be significantly lower than the investment amount.

  LOANS

No loans are available.

  CONTINUATIONS

On the maturity date, investors will have the option of continuing the investment and switching into a
fund, or range of funds, that Sanlam makes available at the time.

  ADMINISTRATIVE INFORMATION

 Proposal form               AEB47
 Product name code           G014
 Quotations                  Quotations are not available on SanQuote. They can be requested from
                             Product Support on 021 916 3082. Quotations are also available at
                             advisors and marketers consultants.




GE 8/2006                                            BL2/4
                            CHAPTER 3


            INTERNATIONAL ROLLING GUARANTEE INVESTMENT


                                                         Page
HOW THE PRODUCT WORKS …………………………………………………...             BL3/1
BENEFITS OF THE PRODUCT ………………….………………………………..           BL3/1
REMUNERATION OF INTERMEDIARY ……………….…………………………           BL3/1
NO INCOME PLAN …………………………………………………….……………                BL3/1
AVAILABILITY OF PRODUCT ……………………………………………………             BL3/2
MINIMUM INVESTMENT AMOUNT ……………………………………………….            BL3/2
AGE AT ENTRY …………………………………………………………………..…                BL3/2
MINIMUM GUARANTEE MATURITY VALUE …………………………………..         BL3/2
TERM …………………………………………………………………………………                     BL3/2
MODE OF PAYMENT AND FREQUENCY ……………………………………….           BL3/2
INCEPTION DATE …………………..………………………………………………               BL3/2
POLICY CHARGES …………………………………………………………….……                BL3/3
DEATH BENEFIT ……………………………………………………………………                 BL3/3
INVESTMENT GUARANTEE ……………………………………………………….              BL3/3
CAP …………………………………………………………………………………...                   BL3/3
NOMINEE FOR POLICY OWNERSHIP ……………………...…………………..        BL3/3
CESSIONS ……………………………………………………………………………                   BL3/4
CANCELLATION PERIOD …………………………………………………….……              BL3/4
CASH WITHDRAWALS …………………………………………………………….                BL3/4
LOANS ………………………………………………………………………………..                   BL3/4
CONTINUATIONS …………………………………………………………………..                BL3/4
ADMINISTRATIVE INFORMATION ……………………………………………….           BL3/4




GE 6/2005                        BL
                                                  CHAPTER 3


                    INTERNATIONAL ROLLING GUARANTEE INVESTMENT


The International Rolling Guarantee Investment is a five-year linked investment backed by securities
arranged by Goldman Sachs International. It provides clients with the opportunity of investing in the
Dow Jones EUROSTOXX 50 Index and earning real returns, while their capital is protected.


    HOW THE PRODUCT WORKS

•   The International Rolling Guarantee Investment is a lump-sum investment with a five-year term. The
    policy term is divided into four policy periods of 15 months each.
•   The minimum investment amount is £15 000 and must be paid in pound sterling.
•   100% of the investment amount is invested, which means there are no initial charges.
•   Two variations of the product are available, namely Protection and Enhanced. The growth for both
    options is linked to the Dow Jones EUROSTOXX 50 Index. This index is well-established and
    includes a broad spectrum of the most successful and influential European companies.
•   The policy issued is a sinking fund policy.
•   In the case of the Protection Option the growth in pound sterling (before fund costs are recovered)
    over any policy period will never be negative. The growth over a policy period is limited to a
    contractual cap (before fund costs are recovered and before taxes). In the case of the Enhanced
    option the growth is subject to a minimum growth rate of minus 10% per year and a cap that is
    higher than the cap that applies to the Protection option at that stage. Any positive growth in the
    Enhanced option will be increased by 10%.
•   The investment may not be surrendered before the maturity date.


    BENEFITS OF THE PRODUCT

Residence-based tax requires that South Africans with legal assets offshore must declare all their
foreign income and capital gains to the South African Revenue Services (SARS) for income-tax
purposes.

The International Rolling Guarantee Investment offers clients a tax-efficient investment medium with
growth potential, but without the risk of capital losses at the end of the investment term.


    REMUNERATION OF INTERMEDIARY

Commission is equal to 3% of the investment amount. If the commission is cut, the allocation amount
will be increased by the same percentage as that by which the commission is reduced. If no
commission percentage has been indicated on the application form, the application will be issued
according to the commission percentage that appears on the quotation.


    NO INCOME PLAN

The International Rolling Guarantee Investment is available only for capital growth. No income plan is
available.




GE 6/2005                                            BL3/1
    AVAILABILITY OF PRODUCT

The product is available for:

•    individuals
•    trusts where all the eventual beneficiaries are natural persons.

The product is not available for institutions (whether taxpaying or exempt).

    MINIMUM INVESTMENT AMOUNT

£15 000

The investment is accepted only in pound sterling. If the offshore money is in another currency
(including US dollar and euro), the money must be converted to pound sterling before it can be invested
in the International Rolling Guarantee Investment.

No ad hoc lump sums may be added after the date of issue.

    AGE AT ENTRY

Minimum       : 1 age next birthday
Maximum       : 90 age next birthday


    MINIMUM GUARANTEE MATURITY VALUE

The International Rolling Guarantee Investment is a linked investment. This means the maturity value
will be determined by the value paid out by the securities of Goldman Sachs International less policy
charges. The securities’ minimum maturity value is as follows:

Protection

A maturity value of no less than the investment amount.

Enhanced

A maturity value of no less than 90% of the investment amount.


    TERM

Only a five-year term is available.


    MODE OF PAYMENT AND FREQUENCY

Only lump sums (optional money) are allowed. Compulsory money cannot be used for the investment.

    INCEPTION DATE

•    The inception date is determined as soon as enough applications (money) have been received to
     buy a tranche.
•    As soon as the inception date has been determined, the 17th of the previous month will be the cut-
     off date on which money had to be paid in. Money received after the 17th of that month will be held
     over until the next tranche can be bought.

Sanlam Life will add any interest on the investment amount from the date of payment to the inception
date to the purchase price, and the policy will be issued with the higher purchase price.




GE 6/2005                                             BL3/2
    POLICY CHARGES

No initial charges will be recovered from the investment amount. At least 100% of the lump-sum
investment amount is invested for the client. If less than the standard commission of 3% is payable,
more than 100% of the lump-sum investment amount will be allocated for the client.

The following charges are recovered from the policy:

•   A fund charge is deducted from the value of the fund when the maturity value is determined. The
    fund charge is currently as follows:
       −    1,6% per year (2,0% per policy period) for investment amounts larger than or equal to
            £15 000, but smaller than £45 000.
       −    1,5% per year (1,9% per policy period) for investment amounts larger than or equal to
            £45 000, but smaller than £90 000.
       −    1,45% per year (1,8% per policy period) for investment amounts of £90 000 or more.
•   Any tax (currently only capital gains tax of 7,5%) that Sanlam Life has to pay on the growth of the
    policy, is recovered at the end of each policy period.


    DEATH BENEFIT

No death benefit and death guarantee apply. Because it is a sinking fund policy, there is no life insured.
If a policyholder is an individual he or she must appoint a nominee for ownership when taking out the
policy. If the policyholder dies before the end of the policy term, and the nominee accepts the
appointment he or she becomes the new policyholder.


    INVESTMENT GUARANTEE

The International Rolling Guarantee Investment is a linked investment. This means the maturity value is
determined by the value paid out by the securities of Goldman Sachs International. The securities’
minimum maturity value is as follows:

•   For the Protection option, growth vests every 15 months and will, before to the policy charges
    recovered, never be less than nil. The original investment amount is guaranteed back at the end of
    the policy term.
•   For the Enhanced option, growth also vests every 15 months and will, before to the policy charges
    recovered, never be less than 10%. 90% of the original investment amount is guaranteed back at
    the end of the policy term.

    CAP

The growth over the term of the policy is limited to a cap that is contractually determined and applies for
the full policy term. This growth may be adjusted for new business from time to time and depends on
interest rates and market conditions.

The cap may also vary depending on the date of payment. Therefore, if a quotation has been obtained
and the money is not paid in on the date entered on the computer, a new quotation with the correct date
of payment must be obtained.


    NOMINEE FOR POLICY OWNERSHIP

If the policyholder is an individual, he or she must appoint a nominee or nominees for ownership when
taking out the policy. If no nominee has been entered on the application form, the application will be
referred back to the intermediary.




GE 6/2005                                           BL3/3
  CESSIONS

Outright cessions and collateral cessions are available.

Outright cessions:

The policy may not be ceded outright to a taxpaying institution. If the tax status of the cessionary differs
from that of the cedent, the policy values of the cessionary may differ from those of the cedent.

Collateral cessions:

The cessionary’s tax status has no influence on the investment.


  CANCELLATION PERIOD

A period of 14 days applies for unilateral cancellation after the application form was signed. Other than
that this policy may not be surrendered or cancelled unilaterally.

  CASH WITHDRAWALS

No cash withdrawals can be made before the end of the policy term.


  LOANS

No loans are available.


  CONTINUATIONS

No continuations can be done in the International Rolling Guarantee Investment.

  ADMINISTRATIVE INFORMATION

 Proposal form            AEB30
 Product name             Protection : G007
 code
                          Enhanced : G008
 Quotations               Quotations are not available on SanQuote. It can be requested from Product
                          Support at 021 916 3082.




GE 8/2006                                            BL3/4
                                                      SECTION BQ

                                           COLLECTIVE INVESTMENTS


                                                                                                               Page


WHY DO PEOPLE SAVE? …………………………………………………………..                                                                   BQ1

WHY INVEST IN COLLECTIVE INVESTMENTS? ………………………………..                                                           BQ1

SANLAM COLLECTIVE INVESTMENTS ………………………………………….                                                                BQ2
–   GEOGRAPHICAL CLASSIFICATION …………………………………..…………….…..                                                       BQ2
–   ASSET CLASSES ……………………………………………………………………………                                                                BQ3
–   DOMESTIC EQUITY FUNDS ………………………………………………………….…..                                                           BQ3
    General Sector ….…………………………………………………….……………………...                                                          BQ3
    Growth Sector …..…………………………………………………………………………….                                                            BQ3
    Large Cap Sector …………………………………………………………………….…..…..                                                         BQ4
    Industrial Sector ………………………………………………………………………………                                                           BQ4
    Financial Sector ………………………………………………………………………………                                                            BQ4
    Smaller Companies Sector .……………………………………………………………..….                                                      BQ4
    Value Sector ………………………………………………………………………….…..…..                                                           BQ4
–   DOMESTIC ASSET ALLOCATION FUNDS ………………………………………….                                                          BQ5
    Prudential Medium Equity Sector ……………………...………………………………..….                                                BQ5
    Targeted Absolute & Real Return Sector ………………………………………………….                                                BQ5
–   DOMESTIC REAL ESTATE FUNDS ………………………………………………………                                                           BQ6
    General Sector ……………………………………………………………………………….                                                             BQ6
– DOMESTIC FIXED INTEREST FUNDS ……………………………………………..                                                            BQ6
    Income Sector ….…………………………………………………………………….…..…..                                                          BQ6
    Varied Specialist Sector .............……………………………………………………………                                              BQ6
    Bond Sector .……………………………………………………………………………….…                                                              BQ6
    Money Market Sector …………………………………………………………………..…....                                                       BQ6
–   WORLDWIDE EQUITY FUNDS ……………………………………….....................                                                BQ7
    Varied Specialist Sector .……………..………………………………………………….….                                                    BQ7
–   FOREIGN FUNDS ……….…………………………………………………………..                                                                 BQ7
    Equity – General Sector …………….……………………………………………………....                                                     BQ7
    Asset Allocation Flexible Sector ………………………………………………………..…..                                                BQ8
    Fixed Interest – Bond Sector …………...................................................................…...   BQ8
–   GENERAL INFORMATION ………………………………………………………………....                                                           BQ9
–   APPLICATION PROCEDURE ……………………………………………………………...                                                           BQ9


                                                                                                               2/…




GE 2/2006                                                       BQ
                                     -2-
                                                                   Page


–   DEALING WITH CHEQUES ………………………………………………………………..                BQ10
    Pricing policy ………………………………………………………………………………….                BQ10
    Forward pricing ………………………………………………………………………………                 BQ10
–   ENQUIRIES: Sanlam Collective Investments …………………………………………...   BQ10
NEW FUND : SANLAM DIVIDEND INCOME …………………………………..….                BQ11
–   FEATURES OF THE FUND …………………………….…………………………………..               BQ11
–   TYPICAL INVESTOR …….…………………………….……………………………………                 BQ11
–   OTHER FUND INFORMATION ………………………….…………………………………                BQ11
–   TECHNICAL INFORMATION ………………………………………………………………                 BQ11
RISK PROFILES OF MANAGED FUNDS ………………………………………….                   BQ12

RISK RATINGS OF ACTIVE FUNDS ……………………………………………….                   BQ12




GE 2/2006                             BQ
                                    COLLECTIVE INVESTMENTS


Collective Investments are an ideal investment medium for your client wishing to save effectively in the
medium term (three years) and longer by means of an equity linked or money market investment. Apart
from the fact that the investor can enjoy the benefits of capital growth, he has a liquid investment which
can be easily converted into cash.


    WHY DO PEOPLE SAVE?

•   For a specific purpose – house, own business, trip around the world, a farm to retire on, a motor-car
    or a boat.
•   To accumulate capital – for providing for children’s studies and for carefree days after retirement.
•   For peace of mind – for the knowledge that funds will be available when something unforeseen
    happens.

WHAT HAMPERS EFFECTIVE SAVING?

•   The effect of inflation
•   The effect of tax
•   Various needs to be satisfied

INVESTMENT CHANNELS AVAILABLE

•   Income-providing (interest)     : banks and post office.
•   Capital growth only             : gem-stones, paintings and Persian carpets.
•   Growth investments (income      : shares, collective investments, properties and assurance.
      and capital growth)

However, successful investment in shares requires:

•   a large capital outlay
•   time
•   investment expertise.

If all three requirements cannot be satisfied, the answer is a Sanlam collective investment (or unit trust
as it is generally known).


    WHY INVEST IN COLLECTIVE INVESTMENTS?

•   A collective investment portfolio with a good spread reduces investment risks.
•   The investor benefits from Sanlam’s investment expertise, since he does not have to select shares
    himself.
•   When share prices rise, he enjoys capital growth.
•   An investment in collective investments ensures liquidity.
•   An investment in collective investments offers tax benefits, leaving the client with more money to his
    disposal (see "Taxability of Collective Investments ").
•   The investor can invest as and when it suits him.
•   Less record-keeping and control are necessary.
•   A regular fixed investment reduces the risk of bad timing and allows the investor to enjoy the benefit
    of rand cost averaging.
•   Collective investments are regulated by the Collective Investment Schemes Control Act.




GE 8/2006                                          BQ1
TAXABILITY OF COLLECTIVE INVESTMENTS

•    Capital growth: Subject to capital growth (CGT) since October 2001. The conduit principle applies.
•    Local dividends: Tax-free according to current legislation
•    Foreign dividends: Taxable
•    Interest: Taxable

Exemption:

Individuals receive an exemption from interest and foreign dividends received:

     •   Persons 65 and older    : R24 500
     •   Persons under 65        : R16 500

From 01/03/2006 only the first R2 500 of the exemption may be applied against foreign interest and
foreign dividends (if any). The balance is applied against local interest income.


                                SANLAM COLLECTIVE INVESTMENTS

A lump sum or regular fixed amounts can be invested in any of Sanlam’s collective investments.

Although all Sanlam’s collective investments strive for strong long-term growth in capital and income,
the portfolios have been developed in such a way that each one can individually satisfy specific needs to
a lesser or greater extent.

Analysing your client’s needs

Collective Investment Schemes in portfolios are grouped into sectors to enable investors to select the
specific collective investment (or combination of collective investments) which would best satisfy your
client’s personal needs, as well as compare the performance of portfolios with similar objectives and
benchmarks.

The following guidelines will help your client decide upon the ideal fund:

     •   Decide geographically where you want to invest for example domestic, foreign, worldwide or
         regional
     •   Decide how or where you want to invest the funds. In this case “where” does not refer to the
         geographical area as above, but to the financial tools or instrument


                                GEOGRAPHICAL CLASSIFICATION


    Domestic                 These invest in the local markets and are the most widely available of the
                             schemes. Minimum investment in SA should be 85% of the portfolio’s
                             assets.
    Foreign                  CIS in this category have a minimum of 85% of their investments outside of
                             South Africa. These funds must not be confused with pure offshore funds in
                             which investors can only invest their R2 000 000 allowance.
    Worldwide                Worldwide CIS invest in various markets around the world. The worldwide
                             funds do not have a set minimum for foreign or domestic assets.




GE 8/2006                                          BQ2
                                      ASSET CLASSES

 Equity                 A minimum of 75% of the fund must be invested in equities at all times. At
                        least 80% of this equity portion must be invested in the JSE and a maximum
                        of 20% may be invested outside the JSE.
 Asset Allocation       Invest in a wide spread of investments in the equity, bond, money and
                        property markets.
 Fixed Interest         Invest in bond, money market instruments and other income earning
                        securities.
 Real Estate            This tier consists of investments in equity portfolios, asset allocation
                        portfolios, fixed interest portfolios and real estate portfolios.




                                DOMESTIC EQUITY FUNDS

CATEGORY: GENERAL SECTOR

 General Equity Fund    The fund seeks maximum capital growth over the medium to long term by
                        investing in selected shares across all the major sectors of the JSE.

                        This fund is suitable for investors wanting a well balanced equity portfolio
                        and do not have expert knowledge of the stock exchange.
 Multi Managed Equity   The fund invests in a portfolio of collective investment schemes in order to
 Fund of Funds          secure growth of capital for its unitholders over the long term. The fund will
                        invest predominantly in selected sector and theme funds in order to
                        maximise returns.

                        The fund is ideally suited to the investor striving for optimum capital growth
                        through an investment in a wide range of collective investments focusing
                        strongly on aggressive capital growth. Investors in this fund should be
                        willing to accept a higher though calculated risk.

CATEGORY: GROWTH SECTOR

 Growth Fund            The trust seeks maximum capital appreciation as their primary investment
                        objective through predominantly investing in growth shares.
                        Growth companies can be defined as those whose earnings are on or are
                        anticipated to enter a strong and sustainable upward trend and typically
                        trade on high price to earnings ratios (PE ratios). Determination of a
                        company as "growth share" takes into consideration the company's
                        sustainable earnings growth on the basis of a combination of:
                           •   The 2 year historical earnings growth and
                           •   1-year consensus I-net forecasts.

                        This fund is suited for clients with a higher risk profile than those who
                        normally invest in a general equity fund.




GE 8/2006                                     BQ3
CATEGORY: LARGE CAP SECTOR

 Index Fund        The fund seeks long term growth by tracking the FTSE/JSE Top 40 listed
                   shares. The fund’s portfolio is therefore tailored to match the performance
                   of the FTSE/JSE Top 40 Index.

                   This fund is suited for clients who wish to apply their own investment timing
                   and/or who believe that this passively managed fund will offer better returns
                   than the average actively managed equity fund in the long term.

CATEGORY: INDUSTRIAL SECTOR

 Industrial Fund   The fund seeks capital growth by investing in selected shares in the
                   industrial sector. The trust can also invest in foreign markets.

                   This fund is suited for clients requiring larger exposure to industrial shares,
                   with the associated capital growth this sector is able to offer.

CATEGORY: FINANCIAL SECTOR

 Financial Fund    This is a specialist fund that offers investors an opportunity of investing in
                   the financial services industry. A typical portfolio of financial services
                   companies would include banks, insurance companies, brokerage firms and
                   other companies whose principal business operations involve the provision
                   of various financial services.
                   The fund aims to achieve superior returns over the medium to long term
                   through well researched superior stock selection. The fund is suitable for
                   clients requiring greater exposure to financial shares as part of a balanced
                   portfolio.

CATEGORY: SMALLER COMPANIES SECTOR

 Small Cap Fund    The fund is managed actively and aggressively in order to achieve
                   maximum capital appreciation in the medium to long term. The focus is on
                   small to mid capitalisation companies with above average growth potential
                   and that have been mispriced by the market. At least 75% of the fund will
                   be invested in small to mid cap shares at all times. Our pragmatic value
                   approach emphasises the importance of minimising any downside risk,
                   while maximising the contribution from stock selection.

                   This fund is suited for clients who are seeking exceptional growth potential
                   in the longer term and are prepared to accept a higher degree of risk.

CATEGORY: VALUE SECTOR

 Value Fund        The fund has the primary objective of growth, by investing in a medium with
                   a reasonable level of current income and relative stability for capital. The
                   fund focus on achieving this objective by investing in financially sound
                   companies which offer exceptional value.

                   These include shares with a low price to earnings ratio, shares trading at a
                   discount to their net asset value, and shares whose prices do not reflect
                   future earnings potential.

                   The investor most likely to invest in this fund is the more conservative and
                   knowledgeable investor following an investment approach of seeking value.




GE 8/2006                                BQ4
                           DOMESTIC ASSET ALLOCATION FUNDS


These funds invest in a spectrum of investments in the equity, bond money, or property markets.
Typically the actual equity exposure will be between 40% and 65% as funds in this category generally
conform to legislation governing retirement funds, (Regulation 28 of the Pension Funds Act).

CATEGORY: PRUDENTIAL MEDIUM EQUITY SECTOR

 Balanced Fund            The fund invests in a wide spectrum of investments in the equity, bond,
                          money and property markets in order to maximize total returns over the
                          long term.

                          The fund is suited for pension funds, smaller companies and employers
                          wishing to make pension provision for employees, as well as individuals
                          requiring capital growth via a balanced portfolio. This is a moderate risk
                          balanced fund that complies with Regulation 28 of the Pension Funds Act.
                          This means that the fund may not have more that a 75% exposure to
                          equities at any one time.
 Multi Managed            This fund invests in a portfolio of collective investments or approved
 Balanced Fund of         international funds to seek steady growth of capital and income. The
 Funds                    fund’s investments are composed in such a way that it is accessible for
                          pension fund investments i.e. follows prudential guidelines.

                          The fund can be recommended to the client who has to comply with the
                          instructions of Regulation 28 under the Law on Pension Funds. This client
                          would want to employ collective investments as a medium for pension
                          provision, but would shun the burden of investment choices. With its
                          specific investment objective, this fund is ideally suited to the client
                          wanting long-term stable growth and capital in a broad distribution of
                          collective investments subscribing to the above objective.

CATEGORY: TARGETED ABSOLUTE & REAL RETURN SECTOR

 Inflation Linked Fund    This fund invests in the flexible combination of investments in the equity,
                          gilt and money markets, both locally and abroad, aiming for maximum
                          positive real returns (comprising capital and income growth) over the
                          medium to longer term.

                          The fund can be recommended to the client who has to comply with the
                          instructions of Regulation 28 under the Law on Pension Funds. The fund
                          is ideally suited to the cautious investor wanting to save for e.g.
                          retirement.
 Defensive Fund of        The fund invests in a balanced and diversified portfolio of collective
 Funds                    investments which invests in sectors or shares with sound growth potential
                          in order to achieve stable income and capital growth.

                          This fund is a prudential fund (Regulation 28), and is thus ideally suited to
                          the cautious investor wanting to save for e.g. retirement. The fund is
                          suited for any investor wanting to earn a real return. This fund also
                          provides manager diversification which should help the portfolio to have a
                          lower volatility than similar mandated single – manager portfolios.




GE 8/2006                                       BQ5
                        DOMESTIC REAL ESTATE FUNDS


CATEGORY: GENERAL SECTOR

 Property Fund       This fund aims to provide investors with both a high income yield, and
                     long-term capital growth. It therefore meets the needs of investors who
                     require high levels of income, and who are willing to accept higher risk
                     than that of the traditional fixed-interest or money market portfolios.



                       DOMESTIC FIXED INTEREST FUNDS


CATEGORY: INCOME SECTOR

 Income Fund         The fund aims to offer a reasonable level of income with relative capital
                     stability. The fund invests in local interest bearing-investments such as
                     gilts and fixed deposits and other high income earning securities.

                     This fund is suited for clients who want exposure to the capital market and
                     who need a higher income than that offered by equity collective
                     investments, and relative capital stability.

CATEGORY: VARIED SPECIALIST SECTOR

 Absolute Return     The fund is managed with the dual goal of capital protection as well as the
 Income Fund         out performance of inflation on a consistent basis. The primary goal of this
                     fund is therefore to consistently outperform inflation (headline CPI) with a
                     return of 3% p.a. over any 24 month period, while also delivering positive
                     returns over any rolling 12 month period.

                     This is a low risk fund that complies with regulation 28 of the Pension
                     Fund Act. This fund will have no equity exposure.
 Dividend Income     The objective of the portfolio is to offer a liquid investment in assets,
 Fund                consistent with principles of capital preservation, which deliver income
                     primarily in the form of dividends. There will be some interest income.
                     The return on the porfolio will to a large extent aim to track the local
                     interest rate cycles.

                     The fund is suitable for clients who have already utilized their interest
                     exemption and clients who require capital protection.

CATEGORY: BOND SECTOR

 Bond Fund           The fund offers unitholders an optimum overall yield comprising both
                     capital growth and income. The fund invests in public and private sector
                     bonds and deposits.

                     This fund is suited for Institutions and individuals requiring investment
                     growth via the capital market with a high income.

CATEGORY: MONEY MARKET SECTOR

 Money Market Fund   This fund seeks to maximise interest income, preserve the fund’s capital
                     and provide immediate liquidity.

                     The fund is suited for investors requiring competitive interest with regular
                     income distribution and total capital stability.


GE 8/2006                                  BQ6
                              WORLDWIDE EQUITY FUNDS

CATEGORY: EQUITY- VARIED SPECIALIST SECTOR

 Resources Fund         This specialist fund focus on maximum capital growth by taking advantage
                        of changing resources cycles by investing in companies engaged in
                        exploration, mining, distribution and processing of metals, minerals,
                        energy, chemicals, forestry and other resources.

                        The fund will appeal to the knowledgeable investor who is prepared to
                        take on calculated risk.



                                      FOREIGN FUNDS

CATEGORY: EQUITY - GENERAL SECTOR

 International Equity   The investment objective of the fund is to achieve above average capital
 Fund of Funds          growth over the medium to long term by investing in a spread of
                        international equity collective investments.

                        The fund is suited for clients with a need for international diversification
                        and a hedge against exchange rate risk. The Fund is constructed to
                        reflect the composition of the MSCI World Index (Developed Markets).

                        This fund aims to track the MSCI World Index (Developed Markets) and
                        active management does not form part of the fund construction process.
 Asia Pacific Fund of   The primary objective of the fund is to provide medium to long term capital
 Funds                  growth by investing predominantly in equity funds focused on countries in
                        the Asian Pacific region including Japan. Aimed at the assertive investor
                        who wants exposure to the economies of the Asia Pacific countries. The
                        fund will primarily invest in Japan and Asian Pacific developed markets,
                        with a small part allocated to the so-called emerging Asian Pacific
                        markets.

                        “Developed markets” include Australia, Hong Kong/China, Singapore,
                        New Zealand and other countries that Morgan Stanley Capital
                        International may classify in that capacity. “Asian Pacific Emerging
                        Markets” include Pakistan, India, Malaysia, Korea, Taiwan, Indonesia,
                        Philippines, Thailand and Sri Lanka.
 Pan-Growth Fund        The fund invests primarily in equities listed on developed Pan-European
                        stockmarkets (UK and the Continent). The investment objective of the
                        fund is to provide above average capital growth in the medium to long
                        term.

                        This is a specialist rand-denominated foreign fund and the target market is
                        investors who believe that one should diversify your portfolio by including
                        exposure to the dynamic environment of the UK and Europe.
 Global Equity Fund     The fund aims to offer superior returns in the medium to long term by
                        investing in a well spread portfolio of equities across the globe. The fund
                        is an actively managed multi-manager fund.

                        The fund is suited for clients with a need for international diversification
                        and a hedge against exchange rate risk.




GE 8/2006                                     BQ7
CATEGORY: ASSET ALLOCATION FLEXIBLE SECTOR

 International          The Sanlam International Balanced Fund of Funds is a diversified portfolio
 Balanced Fund of       in terms of international assets classes and investment processes.
 Funds                  Leading international asset managers are appointed to manage this fund
                        and the objective is to provide steady growth of capital to the investor over
                        the long term and in dollar terms.

                        The fund will be exposed to various asset classes (bond, equity, property
                        & money market) and is ideal for the investor with a moderate risk profile
                        that requires broad based international exposure. The fund forms part of
                        our multi-manager single fund solution.
 International          The Sanlam International Defensive Fund of Funds is a diversified
 Defensive Fund of      portfolio in terms of assets classes and has a high exposure in less
 Funds                  volatile asset classes such as cash and fixed interest securities.

                        The fund is suitable for investors that want to invest in international
                        markets but choose to do so through a less volatile and lower risk option.

                        It aims to provide investors with long term capital preservation and capital
                        growth qualities, in dollar terms and is positioned for investors that
                        requires international exposure but with a lower risk appetite.

CATEGORY: FIXED INTEREST - BOND SECTOR

 Sanlam International   The fund is a specialist fund with a specific focus on international fixed
 Bond Fund of Funds     interest funds. The fund will provide access to international funds
                        investing in fixed income securities. The volatile equity markets are
                        forcing investors to turn to fixed-interest funds to minimise risk.

                        This fund offers access to international funds that invests in fixed-income
                        securities. The fund will have at least 85% offshore exposure at all times.




GE 8/2006                                     BQ8
                                      GENERAL INFORMATION

                                    MINIMUM CONTRIBUTIONS


              Collective Investment                           Monthly                Lump sum
                                                         R                       R
 Sanlam Absolute Return Income Fund                             200,00                 5 000,00
 Sanlam Asia Pacific Fund of Funds                              500,00                 5 000,00
 Sanlam Balanced Fund A                                         200,00                 5 000,00
 Sanlam Bond Fund                                               200,00                 5 000,00
 Sanlam Defensive Fund of Funds                                 200,00                 5 000,00
 Sanlam Dividend Income Fund                                  1 000,00                20 000,00
 Sanlam Financial Fund                                          200,00                 5 000,00
 Sanlam General Equity Fund A                                   200,00                 5 000,00
 Sanlam Global Equity A                                         500,00                 5 000,00
 Sanlam Growth Fund A                                           200,00                 5 000,00
 Sanlam Income Fund                                             200,00                 5 000,00
 Sanlam Index Fund                                              200,00                 5 000,00
 Sanlam Industrial Fund A                                       200,00                 5 000,00
 Sanlam Inflation Linked Fund                                   200,00                 5 000,00
 Sanlam International Balanced Fund of Funds                    500,00                 5 000,00
 Sanlam International Bond Fund of Funds                        500,00                 5 000,00
 Sanlam International Defensive Fund of Funds                   500,00                 5 000,00
 Sanlam International Equity Fund of Funds                      500,00                 5 000,00
 Sanlam Multi Managed Balanced Fund of Funds A                  200,00                 5 000,00
 Sanlam Multi Managed Equity FoF                                200,00                 5 000,00
 Sanlam Money Market Fund                                     1 000,00                20 000,00
 Sanlam Pan-Europe Fund                                         500,00                 5 000,00
 Sanlam Property Fund                                           200,00                 5 000,00
 Sanlam Resources Fund                                          200,00                 5 000,00
 Sanlam Small Cap Fund A                                        200,00                 5 000,00
 Sanlam Value Fund                                              200,00                 5 000,00


  APPLICATION PROCEDURE

Registration (form TA/TE7). Fill in the investor’s personal details.

The investor has to sign the registration form. To comply with the Collective Investment Schemes
Control act the advisor has to disclose the following information to the client: investment objectives of
the portfolio, information on the price (nav price), charges, risk factors, income accruals, any additional
information.

Remember to enter your name and telephone number in the space provided for intermediaries.

According to FICA legislation that came into effect on 30 June 2005, the information of the client must
be identified and verified before SCI can transact. (refer to AEB forms on the brokers and adviser's
web). The required documentation must be included with the registration form. SCI may not process or
price any lump sum investment of R50 000 or recurring investment with an annual premium of R25 000
without the completed FICA documentation.

An advice record, as required by FAIS, must also accompany the application form. The investment will
not be processed without the advice record. The same applies to switching instructions.



GE 8/2006                                          BQ9
Investment particulars

•   Monthly investment – no initial amount is required.
•   A lump sum investment and further amounts as they suit the investor.

Income

Reinvestment of income is recommended to boost growth, except when needed to supplement income.

Debit Order

Suppy address if account-holder is not the investor.


    DEALING WITH CHEQUES

In future amended cheques or cheques that have already been deposited will no longer be accepted by
banks. An amended cheque is any cheque on which a change has been made, whether it is the date,
the amount or the signature of the drawer. Even if the owner of the cheque signs his name next to the
change, it will not be accepted. A cheque that has already been deposited is one that was deposited at
a bank and stamped but was returned to the depositor for some reason. Some of the reasons for this
might be that it is a post-dated cheque deposited too early, or that there are insufficient funds in the
relevant account. Such a cheque cannot be deposited at the bank again.

Banks will no longer be liable unless the words "Non-transferable" or "Not transferable" appear clearly
on the face of the cheque. In terms of the new Act it is also illegal to delete or cancel a crossing or the
word "Non-transferable" on a cheque. Therefore cheques made payable to someone else and marked
"Non-transferable" may not be accepted.

Cheques must be made payable to: Sanlam Collective Investments Limited

If there are any delays for the above-mentioned reasons, it could mean that, if share prices rise, a client
would have to pay a higher purchase price when Sanlam Collective Investments subsequently receives
the "correct" cheque.

PRICING POLICY

All unit transactions, i.e. investments, switches, transfers and repurchases will be processed at the
ruling price on the date on which SCI / a Sanlam office receives the monies as well as all the required
documentation (including FICA and FAIS requirements).

Once-off debit orders will be invested at the ruling price on the date on which SCI receives the monies
from the bank (which is also the same date on which the client’s account will be debited). This process
normally takes three working days.

FORWARD PRICING

SCI uses the forward pricing method to determine fund prices from day to day. With this method the
ruling price for the day is established every evening, and then applied to all transactions that took place
during that day. This means that all transactions can only be priced and processed at the end of the day
and that the investor will transact at an unknown price.


    ENQUIRIES       : Sanlam Collective Investments

Enquiries may be directed to your Collective Investments Sales Support Manager/Consultant or Sanlam
Collective Investments’ General Enquiries Line at (021) 916 1800.




GE 8/2006                                         BQ10
                               NEW FUND : SANLAM DIVIDEND INCOME



    FEATURES OF THE FUND

•     Exposure to money market instruments
•     Same low risk as money market funds
•     Unique product in industry
      −   A high level of monthly income in the form of dividends (tax-free)
      −   Liquidity
      −   No exposure to equities
      −   Constant price of R1,00 – no CGT
•     SARS and FSB approval – based on current tax legislation


    TYPICAL INVESTOR

•     Individuals already utilising their interest exemption
•     Investors who require capital protection
•     Core cash of diversified portfolio
•     Corporates that pay Secondary Tax on Companies (STC) – distribution can be used for STC credits


     OTHER FUND INFORMATION

•     Cutt-off time: 11:00 am
      Only if money and documentation in SCI's possession by cut-off time, will client receive income from
      day 1.
•     A daily rate is published – 7-day rolling average.
•     In order to manage the fund according to its mandate, it may be closed for new inflows.


     TECHNICAL INFORMATION

    Classification                 :   Domestic – Fixed Interest – Varied Specialist
    Risk profile                   :   Conservative – same as MMF
    Initial fee                    :   0.50% (VAT excluded) / 0.57% (VAT included)
    Commission                     :   0.30% (included in initial charge)
    Score                          :   0.10%
    Annual service fee             :   0.85% (VAT excluded) / 0.96% (VAT included)
    Minimum investment             :   Lump sum: R20 000 / Monthly: R1 000
    Income declaration dates       :   End of each month
    Income payment dates           :   Within five working days of new month
    Switches                       :   Difference in initial charge is payable. No score will be paid.




GE 8/2006                                             BQ11
                               SANLAM COLLECTIVE INVESTMENTS

RISK PROFILES OF MANAGED FUNDS (according to sim.sense)

     SANLAM FUNDS                                  FUND CATEGORY                              RISK PROFILE

Balanced Fund                    Domestic – Asset Allocation – Prudential Medium Equity        MODERATE

Defensive Fund of Funds       Domestic – Asset Allocation – Targeted Absolute & Real Return   CONSERVATIVE

Inflation Linked Fund         Domestic – Asset Allocation – Targeted Absolute & Real Return   CONSERVATIVE

International Balanced FoF                 Foreign – Asset Allocation – Flexible               MODERATE

International Defensive FoF                Foreign – Asset Allocation – Flexible              CONSERVATIVE

Multi Managed Balanced FoF       Domestic – Asset Allocation – Prudential Medium Equity        MODERATE


RISK RATINGS OF ACTIVE FUNDS

     SANLAM FUNDS                                  FUND CATEGORY                              RISK RATING

Absolute Return Income
                                       Domestic – Fixed Interest – Varied Specialist               Low
Fund

Asia Pacific Fund of Funds                      Foreign – Equity – General                        High

Bond Fund                                   Domestic – Fixed Interest – Bond                     Medium

Dividend Income Fund                   Domestic – Fixed Interest – Varied Specialist               Low

Financial Fund                                Domestic – Equity – Financial                       High

General Equity Fund                            Domestic – Equity – General                    Medium to High

Global Equity Fund                              Foreign – Equity – General                        High

Growth Fund                                    Domestic – Equity – Growth                         High

Income Fund                                Domestic – Fixed Interest – Income                 Low to Medium

Index Fund                                   Domestic – Equity – Large Cap                        High

Industrial Fund                               Domestic – Equity – Industrial                      High

International Bond FoF                       Foreign – Fixed Interest – Bond                     Medium

International Equity FoF                        Foreign – Equity – General                        High

Money Market Fund                       Domestic – Fixed Interest – Money Market                   Low

Multi Managed Equity FoF                       Domestic – Equity – General                    Medium to High

Pan-Europe Fund                                 Foreign – Equity – General                        High

Property Fund                               Domestic – Real Estate – General                     Medium

Resources Fund                            Worldwide – Equity – Varied Specialist                  High

Small Cap Fund                           Domestic – Equity – Smaller Companies                    High

Value Fund                                      Domestic – Equity – Value                     Medium to High




             GE 8/2006                                BQ12
                                                SECTION BR

                                            ACCIDENT COVER


Accident cover is available as a free-standing policy (instead of as a rider benefit).

 Age at inception       15 to 55 next birthday (for women as well).
 Benefit term           The benefit ceases on the policy anniversary before age 65.
 Benefit amount         Minimum :         R10 000
 (accident benefit      Maximum :         An absolute maximum of R1 500 000 in terms of all the assured’s
 amount)                                  Sanlam policies.
 Rates                  Rates for both men and women, and are determined according to the occupation
                        code and are as follows:
                        −    Rate groups 2 – 4: R3,50 per R10 000
                        −    Rate group        1: R7,00 per R10 000
                        − Codes with special high rates (eg. code 1222): R8,50
                        Notes:
                             1)    In certain occupations in Category II, the rate group for OLV differs from
                                   the rate group for death cover. An example of this is occupational code
                                   1162, where the life assured rate group 2 is for death cover, but the
                                   same person belongs to rate group 1 for OLV. In such cases, the rate
                                   (R7,00) for OLV for rate group 1 must be used.
                             2)    Sanlam reserves the right to revise the premium annually and, with prior
                                   notice to the proposer, to increase or reduce the premium to ensure that
                                   it is always sufficient to provide the same accident amount.
 Premiums and           •    The minimum premium is R36,00 a month and includes a policy fee of R7,00.
 policy fee             •    Single premiums are not available.
 Mode of payment        Stop-order or debit order.
 Frequencies            Monthly, quarterly, half-yearly and annual.
 Debit order            5%
 discount
 Aids and medical       •    No Aids or health declarations are necessary.
 requirements           •    Claims within the benefit term are therefore paid out irrespective of the health
                             or Aids condition of the assured.
 Occupational           Occupational underwriting is necessary.
 underwriting
 Requirement for        For a claim to be considered, the death or physical loss must have occurred
 payment                within 12 months after the accident.
 Claims policy          •    If the requirements for payment are met,
                             −    the full accident cover amount will be paid out at death as a result of an
                                  accident.
                             −    the contractual portion of the accident cover amount i.r.o. one of the other
                                  conditions covered, will be admitted and paid out (partial claim).
                        •    If a partial claim is admitted, the premium and accident cover amount will not
                             be reduced. The full accident cover amount therefore continues for the other
                             conditions in terms of the policy.




GE 6/2005                                             BR1
 Contractual          The benefits will not be paid where death or bodily loss arises directly or indirectly
 exclusions           from, or is traceable to, any of the following:
                      •     riot, insurrection, civil commotion, military or hostile action, or an act of
                            terrorism;
                      •     fighting;
                      •     participation in or practice - with the intention of participating in - racing, with
                            the use of engines of any nature;
                      •     the use of gliders, air balloons;
                      •     parachuting, bungi jumping, hang-gliding;
                      •     scuba diving;
                      •     a deliberate unlawful act by the assured;
                      •     intentional self-inflicted injury;
                      •     self-inflicted injury while the assured is mentally disturbed;
                      •     deliberate failure to obtain the best medical assistance available;
                      •     an act by the assured while he/she is under the influence of alcoholic liquor or
                            drugs or while the alcohol content of his/her blood is 0,16 gram or more per
                            100 ml;
                      •     alcoholic liquor or drugs or medicaments taken by the assured not in
                            accordance with medical prescription;
                      •     radio-activity or a nuclear explosion;
                      •     natural disease of the body or of the mind or any weakness or exhaustion
                            arising from such disease (even if the disease, weakness or exhaustion has
                            been brought on, accelerated or aggravated in any way by these external
                            means).
                      •     aviation, except if the assured
                            −   is a passenger in
                                • an aircraft which is furnished to transport 20 or more passengers; or
                                • a smaller aircraft on a regular flight scheduled for the transport of
                                    passengers.
                            −   is a pilot or member of the air crew
                                • on an aircraft which is furnished to transport 20 or more passengers
                                    and
                                • is on a regular flight scheduled for the transport of passengers, and
                                • that this occupation was declared to Sanlam.
                      •     a natural death.
                      •     suicide.
 Beneficiary          A beneficiary at death can be appointed in the case of an accident.
 Cessions             The policy cannot be ceded.
 Amount payable       Benefits are payable according to the scale below:                          % of benefit
 in the event of an                                                                                 amount
 accident             (a)       At death ………………………………………………………                                       100%
                      (b)       At the total, permanent, irrecoverable and simultaneous
                                loss of the use of both eyes, or both hands, or both feet,
                                or one hand and one foot, or one eye and one hand, or
                                one eye and one foot ……………………………………….                                100%
                      (c)       At the total, permanent and irrecoverable loss of the use
                                of one eye, or one hand, or one foot, or the total,
                                permanent and irrecoverable loss of the hearing in both
                                ears ……………………………………………………………                                         75%
                      (d)       At the total, permanent and irrecoverable loss of the
                                hearing in one ear …………………………………….……..                               50%




GE 6/2005                                              BR2
 Waiver of          There is no waiver of premiums and the policyholder remains responsible for
 premiums           paying the remaining premiums after the admission of a claim.
 Amendments         No amendments are permitted on the policy.
 Indexplan          Not available
 Surrender          None
 values, Loan
 values and Fully
 paid-up values
 Business           Owing to tax and expensive administration implications this product is not
 Assurance          available for business insurance.
 Proposal form      AEB1




GE 6/2005                                     BR3
                         SECTION BU



                       SANLAM TRUST


                                                      Page

SANLAM TRUST …………………………………………………………...……………………...     BU1

−   WILL SERVICES ……………………………………………………………………………...…   BU1
−   ESTATE SERVICES ……………………………………………………………………………     BU2
−   TRUST SERVICES .……………………………………………………………………………..   BU2

GENERAL …………………………………………………………………….……………              BU3

ESTATE AND TRUST CONSULTANTS …………………………………………….…      BU3




GE 10/2005                    BU
                                            SANLAM TRUST




Sanlam Trust provides the following services:

   •   Estate planning advice
   •   Drafting of wills
   •   Administration of deceased estates
   •   Administration of Trusts
   •   Offshore fiduciary services that include preceding services for South Africans with offshore
       assets. These services are also available for foreigners with assets in South Africa.

These services create a number of new opportunities to service the senior market in particular, and offer
intermediaries the opportunity to provide a far more comprehensive service to clients. Will services, in
particular, are an excellent way of "opening doors", building lasting relationships with clients, facilitating
future appointments with clients and promoting client retention and enable intermediaries, according to
proven research, to write more business.

 Will Services        •   Trust companies are authorised to charge a fee for drafting a will.
                      •   The Santrust wills package is a computer program designed to draft standard
                          wills which is available free of charge. The program has been improved and
                          expanded annually. This package, which allows a will to be drafted instantly,
                          should meet the requirements of most clients. The intermediary may choose to
                          either provide this service to the client free of charge or at a standard fee of
                          R285,00 (VAT incl.).
                      •   If the will is not handled by Santrust, the will request form should be forwarded/
                          faxed to the Bellville- or Pretoria offices where the will, will be drafted. The
                          request may also be forwarded to Sanlam Trust via the Internet. If the
                          intermediary has an e-mail address, the drafted will may be forwarded via e-
                          mail. A fee of R399,00 (VAT incl.) is applicable to all wills drafted by Sanlam
                          Trust. If Sanlam Trust is not nominated as (co-) Executor a fee of R798,00
                          (VAT incl.) is applicable. Fee of R798,00 (VAT incl.) for offshore wills.
                      •   All signed wills must be sent to Sanlam Trust, Head Office to be checked for
                          correctness and for safekeeping.
                      •   Sanlam Trust does not recover any fees for the safekeeping of wills.
                      •   No fees are charged for revision of wills in safe custody with Sanlam Trust.
                      Intermediary remuneration:
                      Commission of R100,00 is payable where a fee is recovered and the will is filed
                      with Sanlam Trust for SanTrust and Santrust Pro wills with asset value above
                      R200 000 and R500 000 respectively. Commission of R100,00 is payable for all
                      paid offshore wills. The intermediary has the right to waive the commission, in
                      which case the fee will be reduced accordingly.




GE 8/2006                                           BU1
 Estate Services   Deceased estates originate from the following sources:
                   •   Wills in which Sanlam Trust is named as the executor.
                   •   Wills in which no professional executor has been appointed.
                   •   Cases in which persons die without a valid will (intestate).
                   Intermediaries are constantly kept informed regarding the progress of the
                   administrative process.
                   All inheritances are deposited straight into the bank accounts of the heir(s), with
                   notification of such deposits being sent to the intermediary.
                   Intermediary remuneration:
                   Sanlam Trust pays intermediaries remuneration at the following scale:
                           Executor's remuneration                               Percentage
                            R 5 001 to R 9 000                                       10%
                            R 9 001 to R 35 000                                      15%
                            R 35 001 to R 45 000                                     20%
                            R 45 001 to R 55 000                                     25%
                            R 55 001 to R 65 000                                     30%
                            R 65 001 to R 90 000                                     35%
                            R 90 001 to R115 000                                     40%
                            R115 001 to R140 000                                     45%
                              Above R140 001                                         50%
                   An estate yielding R70 000 towards executor's remuneration, for example will pay
                   out intermediary remuneration as follows:
                   On first R9 000                           10%        R 400,00
                   On R 9 001 to R35 000                     15%        R 3 900,00
                   On R35 001 to R45 000                     20%        R 2 000,00
                   On R45 001 to R55 000                     25%        R 2 500,00
                   On R55 001 to R65 000                     30%        R 3 000,00
                   On R65 001 to R80 000                     35%        R 1 750,00
                   Total compensation to intermediary                   R13 550,75
                   NB: Fifty percent of the estimated remuneration is payable when the estate
                       is reported and the balance, calculated on the final value of the estate,
                       is payable on the finalisation of the estate.
 Trust Services    A trust is the administration of assets on behalf of someone else who, for various
                   reasons, is unable or unwilling to undertake the administration him/herself. The
                   following services are provided:
                       •   Drafting trust deeds
                       •   Administration of trusts
                   Various types of trusts can be established and administered on behalf of clients:
                   •   Testamentary Trust        :     This type of trust is created within a will and comes
                                                       into force only at death of the testator or testatrix.
                   •   Inter Vivos Trust         :     This type of trust is established and managed
                       (also known as a                during the lifetime of the person establishing it and
                       Family Trust)                   constitutes     an   important    estate    planning
                                                       mechanism. Assets are transferred into this trust
                                                       to keep further growth from the client's own estate.




GE 8/2006                                            BU2
 Trust Services   •   Trusts for public        :     Loans or grants are made to a trust exempt from
 (continued)          benefit organisation           income tax or donation tax to ensure that grants to
                      or purpose                     worthy institutions are tax effective.
                  •   Umbrella Trust           :     This is a trust linked to Pension, Provident and
                                                     Retirement Annuity funds, in order to deposit
                                                     benefits to minor beneficiaries, or beneficiaries
                                                     who are unable to handle their own affairs, into a
                                                     trust to be managed on their behalf. This ensures
                                                     that the benefits be allocated for the benefit of the
                                                     relevant beneficiary.
                  •   Guardian's Trust         :     This type of trust is established as alternative for
                                                     the Master's Guardian's Fund and also for the
                                                     purpose of managing benefits to minors that must
                                                     be paid out in terms of a policy.
                  Intermediary remuneration:
                  Establishing        :   20% of the fee of R2 500,00 (VAT excl.), therefore R500,00.
                  and registering
                  trusts
                  Trusts under        :   Trust asset value between        :   25% of acceptance fee
                  administration          R40 000 - R50 000
                                          Trust asset value between        :   40% of acceptance fee
                                          R50 000 - R60 000
                                          Trust asset value above          :   50% of acceptance fee
                                          R60 000
 General          Where Sanlam Trust provides advice to clients in return for a fee, 20% of the fee is
                  paid to the intermediary.
                  Sanlam recognition credits (“Score”) are payable as determined from time to time
                  in respect of all Sanlam Trust products.
                  Sanlam Trust undertakes to protect the interests of intermediaries with regard to
                  the clients that they refer to us. Any leads for further sales will be reverted to the
                  intermediary who referred the client to us. The intermediary will be given the
                  opportunity of making investment proposals to the Trustees of the trust and is
                  entitled to all commission payable on his proposal which has been accepted.
 Estate and       •   BELLVILLE, FREE STATE AND NORTHERN CAPE
 Trust                Tel. No.     : (021) 947-6400
 consultants          Fax          : (021) 947-1496
                  •   PRETORIA AND JOHANNESBURG
                      Tel. No. : (012) 470-0111
                      Fax      : (012) 470-0136
                  •   DURBAN AND PORT ELIZABETH
                      Tel. No. : (031) 560-3624
                      Fax      : (031) 560-3601




GE 8/2006                                          BU3
                          SECTION BV


                  TOPAZ PERSONAL INVESTMENTS


                                                       Page


DESCRIPTION ……………………………………………………………………….               BV 1
PRODUCTS …………………………………………………………………………..                BV 1
PRODUK NAME CODES …………………………………………………………..             BV 1
EXPLANATIONS …………………………………………………………………….               BV 2
TERM ………………………………………………………………………………….                  BV 2
AGE AT ENTRY ……………………………………………………………………..              BV 2
START DATE …………………………………………………………………………                BV 2
PAYMENTS …………………………………………………………………………..                BV 2
PAYMENT GROWTH ……………………………………………………………….               BV 3
RIDER BENEFITS …………………………………………………………………..             BV 3
INVESTMENT ………………………………………………………………………..               BV 4
INVESTMENT GUARANTEE ……………………………………………………...           BV 5
FUND VALUE ………………………………………………………………………..               BV 5
LOYALTY BONUS …………………………………………………………………..              BV 5
CHARGES ……………………………………………………………………………                  BV 6
REDUCTION OR CESSATON OF THE RECURRING PAYMENT ……………   BV 6
REALISING THE PLAN BENEFITS ………………………………………………         BV 7
LOANS ………………………………………………………………………………..                 BV 7
AT DEATH OF A PLANHOLDER …………………….…………………………..         BV 8
CESSIONS ……………………………………………………………………………                 BV 8
TAX …………………………………………………………………………………….                  BV 8
ALTERATIONS …………………………..………………………………………….              BV 8
CONTINUATIONS AND CONVERSIONS ………………………………..………        BV 8
DELAY IN CARRYING OUT REQUESTS ……………………………….……….       BV 8
EXCLUSION OF LIABILITY …………………………………………………….…          BV 8




                                                       2/…




GE 8/2006                     BV
                                 -2-
                                                             Page
INVESTMENT FUNDS
INVESTMENT FUNDS WHICH ARE AVAILABLE FOR TOPAZ PERSONAL
INVESTMENTS ………………………………………………………………………                      BV 9
− SIM MANAGED CAUTIOUS SOLUTION ………………………………………………..         BV 9
− SIM MANAGED MODERATE SOLUTION ………………………………………………           BV 9
− SIM MANAGED AGGRESSIVE SOLUTION ……………………………………………          BV 10
− SANLAM GENERAL EQUITY FUND …………………………………………………….           BV 10
− SANLAM DEFENSIVE FUND OF FUNDS ………………………………………………          BV 10
− SANLAM BOND FUND ……………………………………………………………………                BV 11
− SANLAM PROPERTY FUND ……………………………………………………………..             BV 11
− SANLAM BALANCED FUND ……………………………………………………………..             BV 11
− SANLAM MONEY MARKET FUND ………………………………………………………             BV 12
− SANLAM INFLATION LINKED FUND ……………………………………………………          BV 12
− SANLAM INTERNATIONAL DEFENSIVE FUND OF FUNDS ………………………..   BV 12
− SANLAM MULTI MANAGED EQUITY FUND OF FUNDS …………………………….     BV 13
− SANLAM MULTI MANAGED BALANCED FUND OF FUNDS ………………………..    BV 13
− SANLAM VALUE FUND …………………………………………………………………...             BV 13
− OLD MUTUAL DYNAMIC FLOOR FUND ……………………………………………….          BV 14
− OLD MUTUAL ENHANCED INCOME FUND ……………………………………………          BV 14
− NEDBANK MANAGED FUND …………………………………………………………….              BV 15
− NEDBANK RAINMAKER FUND ………………………………………………………….             BV 15
− INVESTEC EQUITY FUND ……………………………………………………………….             BV 15
− INVESTEC MANAGED FUND ……………………………………………………………              BV 16
− INVESTEC CAUTIOUS MANAGED FUND ……………………………………………..         BV 16
− FUTUREGROWTH ALBARAKA EQUITY FUND ……………………………………….         BV 17
− FRATERS FLEXIBLE FUND ……………………………………………………………..            BV 17
− FOORD EQUITY FUND …………………………………………………………………..              BV 17
− CORONATION OPTIMUM GROWTH FUND ……………………………………………           BV 18
− CORONATION STRATEGIC INCOME FUND ………………………………………….         BV 18
− ALLAN GRAY BALANCED FUND ……………………………………………………….            BV 18
− ALLAN GRAY EQUITY FUND ……………………………………………………………             BV 19
− ALLAN GRAY STABLE FUND ……………………………………………………………             BV 19
MINIMUM PREMIUMS PER INVESTMENT FUND ………………………………            BV 20




GE 8/2006                        BV
                                TOPAZ PERSONAL INVESTMENTS


DESCRIPTION

A Topaz Personal Investment is a linked investment. The plan invests in investment funds that are
managed by collective investment companies, and is a contract between die planholder and Sanlam
Linked Investments (Pty) Ltd (SanLink). SanLink is an administrative financial services provider
licensed by the Financial Services Board in terms of the Financial Advisory and Intermediaries Act, 2002
(FAIS).

As in the case of Stratus products, this is also an investment without any risk benefits (without life
cover), in one or more of the available investment funds (a maximum of 10 funds may be chosen).
Because it is not a policy no lives insured are applicable.

After deduction of certain charges, SanLink buys units for the planholder with his or her net investment.
The planholder can switch between available investment funds at any time.

PRODUCTS

Two discretionary products are available:

•   Committed Plan

    With this plan the client chooses an initial term. Only recurring payments are available. As there is
    no initial marketing charge for this plan there will be a 100% allocation of payments for debit order
    payments.

    Intermediary remuneration is payable upfront and a service fee based on the fund value can be
    payable.

    An alteration charge is payable for alterations as explained later in this chapter.

    This plan offers a loyalty bonus.

•   Flexible Plan

    This plan is more flexible than the Committed Plan. With the Flexible Plan no initial term is chosen –
    the term is open. One-off as well as recurring payments can be made.

    Because of an initial marketing charge on this plan there is not a 100% allocation of payments as
    with the Committed Plan.

    As-and-when service fees are payable on payments, and a service fee based on the fund value may
    also be payable.

    No alteration charge is payable for alterations.

    This plan does not offer a loyalty bonus.

PRODUCT NAME CODES

Topaz Personal Investments – Committed Plan : D01
Topaz Personal Investments – Flexible Plan  : D02




GE 8/2006                                              BV 1
EXPLANATIONS

Option date

It is the date which indicates the end of the term for the Committed Plan, and is indicated in the
planholder's statement.

One-off fund

It is the part of the fund value built up by one-off payments.

Recurring fund

It is the part of the fund value built up by recurring payments.

Alteration charge date

It is the date until which we will levy an alteration charge for certain alterations, and is indicated in the
statement. A separate date applies for the one-off and recurring funds.

TERM

With the Committed Plan the client chooses an initial term. After the expiry of the initial term the term is
open.

Minimum      : 5 years
Maximum      : 10 years

AGE AT ENTRY

Minimum      : 1 next birthday
Maximum      : 90 next birthday

START DATE

The start date of the investment is determined in the same manner as for Stratus Endowment. See
Section BX.

PAYMENTS

One-off payments

One-off payments may be made with the Flexible Plan, provided that they are not less than the
minimum allowed. If the transaction date for a payment, as indicated in the statement, is more than two
days later than the payment date, SanLink will add interest from the payment date to the transaction
date.

Minimum      :   R 2 500 if combined with recurring payments
             :   R10 000 if one-off payment only
             :   R20 000 if regular withdrawals are taken from start date
             :   R 2 500 if an ad hoc payment is made
Maximum      :   None

One-off payments are not permitted with the Committed Plan.




GE 8/2006                                           BV 2
Recurring payments

Recurring payments are allowed, but then they should apply – in the case of Flexible Plan – from the
start of the plan. They cannot be added later. A recurring payment, if applicable, is due on the same
day of each month or year, as indicated in the planholder's statement.

Recurring payments may be made by debit order or stop order. If made by debit order, and the
requested day on which SanLink has to collect the payment does not fall on a working day, or a month
does not have the particular day, it will be collected on the following working day.

The transaction date for a recurring payment is the later of the payment due date and the actual
payment date. If this is not a working day, the transaction date will be the first working day thereafter.
SanLink will not add interest if a recurring payment is made before the transaction due date.

If a payment is not made in full within a 30 day period of grace, SanLink may consider the recurring
payment stopped, and will then levy the alteration charge for stopping recurring payments (if applicable).

Minimum:  Committed Plan : R300 per month for terms less than 10 years
                          : R150 per month for term 10 years
          Flexible Plan   : R300 per month
NB: The above-mentioned minimum recurring payments are further subject to the minimum
     payments per investment fund. See Investment funds for the latter minimums.
Maximum:  None

PAYMENT GROWTH

If the plan has payment growth, the recurring payment will be increased according to the conditions of
the type of payment growth, as chosen.

Available types of payment growth

Fixed growth:          The recurring payment will be increased each year by the chosen fixed
                       percentage.
                       Any percentage payment growth between 5% (minimum) and 20% (maximum)
                       can be chosen.
Sanlam inflation:      The recurring payment will be increased each year by the inflation rate, as
                       determined by SanLink. In setting the rate, SanLink will take into account the
                       change in the consumer price index, or any other commonly accepted method of
                       measuring inflation that may apply at the time. The Sanlam inflation rate may
                       differ from official rates, due to differences in calculation methods. A minimum
                       (currently 5%) and maximum (currently 20%) increase apply, which may change
                       from time to time.

The payment growth type that applies for a plan is indicated in the planholder's statement.

Payment growth can be cancelled or added any time. No alteration charge is then payable.

RIDER BENEFITS

No rider benefits (waiver of payment benefit included) are available on Topaz Personal Investments.




GE 8/2006                                         BV 3
INVESTMENT

SanLink invests a payment, less charges, in the respective investment funds, as chosen by the
planholder. Investments are administered subject to the terms and conditions stipulated by the asset
managers.

SanLink uses the amount allocated to a specific investment fund to buy units in that investment fund.
The units are held in the name of an independent nominee, Axis Nominee (Pty) Ltd, on behalf of the
planholder.

Available investment funds

See Investment funds later in this section for information about the available investments funds. Further
information about all the available investment funds is available on the Sanlam website.

Investment date

The investment date for an amount allocated to a specific investment fund is usually the first working
day after the transaction date. The investment takes place at the unit price applicable on the investment
date. If more than one working day elapses between the transaction date and the investment date,
because of circumstances not within SanLink's control, SanLink will add interest to the amount allocated
to a specific investment fund. This interest will be calculated from the date the investment should have
taken place to the actual investment date.

Clearance period

Payments are subject to a clearance period of 30 days, and no selling of units that resulted from an
uncleared payment will be allowed during this period.

Unit price

The unit price of a specific investment fund is determined by the asset manager. A price is usually only
available one or two days after the day to which it applies. Therefore it will take a few days before a
transaction reflects on the statement. Details of the calculation of unit prices are available on request
from the asset managers.

Income

When income for an investment fund is declared, such income, which may include interest and
dividends, is automatically reinvested in the investment fund for which the income has been declared.
This takes place on the date that the income is paid, which may be later than the date on which the
income was declared.

Discontinuation of availability of an investment fund

It is possible that the availability of an investment fund be discontinued. This may occur if, for example,
legislation changes or the asset manager closes the investment fund. If the plan is affected, Sanlam
Life will request the planholder to choose another investment fund allowed at that stage for this type of
plan, and to inform Sanlam Life of the choice made. If Sanlan Life receives no response to such a
request, SanLink will decide in which investment fund to continue the affected part of the plan

Switches between investment funds

Switches may be made between all the investment funds allowed at the time for this type of plan.

Future payments may be allocated to any investment fund allowed for this type of plan. The payments
already allocated to the current investment funds, will then remain in these investment funds.

Currently there is no administration charge for the first two switches in a plan year. For each
subsequent switch in a plan year, SanLink will levy an administration charge, which will be determined
at the time. The current administration charge is indicated in the statement. SanLink may change the
number of free switches from time to time.




GE 8/2006                                          BV 4
Switches between investment funds (continued)

To perform a switch, SanLink sells the required number of units of the investment funds out of which a
switch is made. With the proceeds of the selling transaction, less the administration charge, SanLink
buys units of the investment funds into which a switch is made. SanLink usually sells and buys on the
first working day after receiving the switch request, at the unit price of the investment funds on that day.
If SanLink cannot sell the units on that day, the buying of units is delayed until SanLink can sell the
units. However, if the selling takes place, but the buying is delayed because of circumstances not within
SanLink's control, SanLink will add interest to the proceeds of the selling transaction, after deducting the
administration charge. This interest will be calculated from the date the buying should have taken place
to the date SanLink actually buys the units.

INVESTMENT GUARANTEE

No investment guarantees are available.

FUND VALUE

The fund value of a specific investment fund is the number of units multiplied by the unit price for that
investment fund.

The fund value of the plan is the total fund value of all the investment funds for that plan.

LOYALTY BONUS

SanLink offers a loyalty bonus on the Committed Plan.

A loyalty bonus will be added to the fund value at the plan anniversaries indicated in the planholder's
statement. The amount of the loyalty bonus is calculated as a percentage of the accumulated
administration charges deducted from the plan since the date on which the previous loyalty bonus was
paid (or since the start date for the first loyalty bonus).

The charges accumulated are:
•   the fixed administration charge, plus
•   a part of the variable administration charge.

The accumulation is done at the rate at which the unit price of each investment fund changes.

SanLink will also pay a bonus when the plan is terminated:
•   due to a death claim, or
•   on request on or after option date, provided that the plan is not terminated within two years of the
    start date.

The loyalty bonus is reduced if the following alterations are done:
•   a loan against the plan;
•   an ad hoc withdrawal from the plan;
•   a regular withdrawal from the plan;
    The bonus is reduced in the proportion that the amount of the alteration payment, plus any
    associated charges has to the fund value as calculated just before the alteration.
•   Cessation or reduction of payments
    For this alteration all future loyalty bonuses will reduce by the same proportion that the payment
    reduces with.




GE 8/2006                                           BV 5
CHARGES

VAT

VAT will be levied on all the charges below.

Plan charges

The current charges are indicated in the statement and can be one or more of the following:

•   An initial marketing charge, deducted from each payment (not with Committed Plan).
•   The payment charge, deducted from recurring payments, if payments are not made by debit order.
    The charge is calculated as a percentage of the recurring payment.
•   A monthly plan charge of currently R7,00 (VAT excluded). This charge is deducted by selling units.
•   A yearly variable administration charge, which is a percentage of the fund value. Separate
    percentages apply to the one-off and recurring funds. This charge is calculated on a monthly basis,
    which means it is divided by 12. The charge is deducted monthly from the fund value by selling units
    to the value of the charge.
•   A yearly marketing charge, which is a percentage of the fund value. This is used to pay part of the
    service fee. This charge is calculated on a monthly basis, which means it is divided by 12. The
    charge is deducted monthly from the fund value by selling units to the value of the charge.

Deductions made by the asset managers

An asset manager levies the following for an investment fund. These are included in the daily price of
the units.

•   A yearly asset management charge, which is a percentage of the market value of the assets in an
    investment fund. This charge is calculated on a daily basis, which means it is divided by 365. The
    current charge for an investment fund is indicated in the statement.
•   A performance charge, which is levied if the investment fund outperforms its benchmark. Detail on
    the benchmark, and how the charge is calculated, is available form the asset manager.
•   Direct investment expenses, for example brokerage, audit fees, bank charges and trustee fees.

Alteration charge

A plan may be changed at any stage, provided SanLink grants the alteration.

For the Flexible Plan no alteration charge is levied.

For the Committed Plan, SanLink will levy an alteration charge if the alteration is done before an
alteration charge date. The alteration charge date is determined at the start and then recalculated at
subsequent alterations.

A minimum alteration charge applies. The current alteration charge for the most common alterations, as
well as the current minimum alteration charge, is indicated in the planholder's statement. This charge
and the minimum that applies may change from time to time.

Administration charge for other transactions

SanLink will levy an administration charge for other transactions, as mentioned further in this chapter.

REDUCTION OR CESSATION OF THE RECURRING PAYMENT

The recurring payment may be reduced or stopped on request, provided that SanLink's conditions at the
time are met. If this happens before the recurring fund's (if applicable) alteration charge date, SanLink
will levy an alteration charge.

One of the conditions for stopping the recurring payment is that a minimum fund value should remain
after the alteration charge has been deducted. If recurring payments are stopped despite this condition
not being met, the plan will be terminated. If no termination value is available, the plan will lapse. The
minimum fund value is currently R1 150,00.




GE 8/2006                                           BV 6
REALISING THE PLAN BENEFITS

The plan benefits may be realized in one of the ways described below. To realize a benefit, SanLink will
sell units on the first working day after the day on which SanLink receives the request. Transfer of units
will take longer to finalise.

Termination of the plan

A plan may be terminated on request. The fund value will be paid to the planholder when the plan is
terminated. If it is a Committed Plan, the fund value, less the alteration charge, will be paid to the
planholder.

On the termination date the plan may be entitled to income already declared, but not yet invested. Once
all declared income has been invested, the units will be sold. The proceeds will be paid to the
planholder, after the deduction of an administration charge, which will be determined at the time. Its
current level is indicated in the statement.

Transfer of units out of the plan

Units may be transferred to another financial services provider or to the planholder. The fund value will
reduce by the value of the units that are transferred, as well as – in the case of a Committed Plan – with
the alteration charge.

Ad hoc withdrawal from the plan

The planholder may make an ad hoc withdrawal from the plan, provided that SanLink's conditions at the
time are met. As these conditions will change from time to time, they will be communicated when the
planholder applies for an ad hoc withdrawal. SanLink will sell the required number of units to pay the
withdrawal amount and – in the case of a Committed Plan – for the alteration charge. The fund value
will reduce by the value of the units sold.

Regular withdrawals for the plan

The planholder may apply to make regular withdrawals from the plan, provided that SanLink's conditions
at the time are met. One of these conditions is that regular withdrawals may not be made while
recurring payments are being made. However, as conditions will change from time to time, they will be
communicated when the planholder applies for regular withdrawals.

The minimum regular withdrawal is currently R150,00 per withdrawal.

SanLink levies an administration charge (currently R5,00) for each withdrawal payment made. The
charge will vary over time.

SanLink will sell the required number of units from the applicable investment funds proportional to their
fund values to pay both the administration charge and the requested withdrawal amount. The fund
value will reduce by the value of the units sold.

If a month does not have the requested withdrawal day, or if it does not fall on a working day, SanLink
will consider the following working day to be the requested withdrawal day. SanLink will sell the units on
the first working day after the requested withdrawal day each month or year. SanLink will pay the
withdrawal amount as soon as possible after the units have been sold.

SanLink will stop the regular withdrawals when it fails to satisfy their conditions.

LOANS

No loans will be allowed.




GE 8/2006                                            BV 7
AT DEATH OF A PLANHOLDER

A linked investment does not have an insured life as in the case of an endowment policy. A person or
an entity may be nominated to become the new planholder after the death of the planholder. The
nominee may only accept or reject a nomination after the death of the planholder.

If the nominee does not accept the nomination, or if nobody has been nominated, the plan will be an
asset in the estate of the planholder.

A nomination may be added, cancelled or changed at any time. It must be in writing and signed by the
planholder, and must reach Sanlam Head Office before the death of the planholder.

The nomination will lapse if the plan is ceded, whether outright or as collateral security.

CESSIONS

The planholder may do a collateral or outright cession.

TAX

The planholder will be responsible for the tax liability arising from the plan. SanLink will supply a tax
certificate each year, setting out the income and capital gains on the plan. Any selling of units, including
those that are sold to pay for charges, will result in a capital gain or loss which may have a tax impact.

A tax liability may also arise when the planholder changes, for example if the plan is ceded outright.

ALTERATIONS

The same alterations available for Stratus Endowment, is also available on this product.                 See
Section BX for the list of alterations allowed.

CONTINUATIONS AND CONVERSIONS

No continuations and conversions of policies to Topaz Personal Investments products are allowed.
Internal transfers of funds from policies that mature, to a Topaz investment where one-off payments are
permitted, can, however, be done.

DELAY IN CARRYING OUT REQUESTS

In some circumstances SanLink may not be able to carry out requests within the normal time standards.
An example would be where an extraordinary event occurs that causes extensive market activity, such
as the outflows experienced on 11 September 2001. An asset manager may also temporarily suspend
the selling of units. SanLink will then carry out requests at the earliest possible opportunity.

EXCLUSION OF LIABILITY

Sanlam Life in its own capacity or as agent of SanLink and SanLink will not be held responsible, and will
not accept liability, for any damages or losses, including consequential losses, sustained by the
planholder arising from or caused by

•   errors, actions or omissions by third parties providing the investment underlying the plan;
•   any time calculation standards, practices and procedures of these parties, or their delay of selling or
    refusal to allow selling on a specific date or at a specific price;
•   any tax or levy of whatever nature imposed by any local, provincial, national or other authority;
•   the acting by SanLink and Sanlam Life on any instructions that were transferred by telephone, fax,
    electronic mail or the Internet, provided that SanLink and Sanlam Life exercised reasonable care to
    establish the validity of the instruction.




GE 8/2006                                           BV 8
INVESTMENT FUNDS
INVESTMENT FUNDS WHICH ARE AVAILABLE FOR TOPAZ PERSONAL
INVESTMENTS:

SIM MANAGED CAUTIOUS SOLUTION

Objective

This fund aims to provide positive returns over any rolling 12 month period, and a return of CPIX + 5%
over any rolling 3 to 5 year period. Capital preservation is of primary importance to the cautious investor
but this fund also offers the opportunity to participate in capital growth potential.

The fund is a single solution consisting of a combination of the best specialist investment management
expertise available in the Sanlam Group, both locally and internationally. The fund is diversified, actively
managed and constructed to offer the client a portfolio with return and risk qualities that reflect the
profile of this fund. Investments will be made through various asset classes primarily bonds, cash,
equities, inflation-linked bonds, listed property and will invest in South African and International markets.

Risk level

Cautious

Asset Management Charge

0.51% per annum (VAT included)

SIM MANAGED MODERATE SOLUTION

Objective

The primary objective of this fund is to achieve long-term capital growth and income generation at
volatility levels that reflect a moderate risk profile. The investments are diversified across primarily
South African equities, bonds and cash securities and international investments can also be included.
The investor in this fund has a moderate risk profile and wants to invest in a quality diversified portfolio.

The fund is a single solution consisting of a combination of the best specialist investment management
expertise available in the Sanlam Group, both locally and internationally. The fund is diversified, actively
managed and constructed to offer the client a portfolio with return and risk qualities that reflect the
profile of this fund.

Risk level

Moderate

Asset Management Charge

0.51% per annum (VAT included)




GE 8/2006                                           BV 9
SIM MANAGED AGGRESSIVE SOLUTION

Objective

The primary objective of the fund is to maximise long-term capital growth at volatility levels that reflect
an aggressive risk profile. The investments are diversified across primarily South African equities,
bonds and cash securities and international investments can also be included. The investor in this fund
has an aggressive risk profile and accepts short term volatility in fund value.

The fund is a single solution consisting of a combination of the best specialist investment management
expertise available in the Sanlam Group, both locally and internationally. The fund is diversified, actively
managed and constructed to offer the client a portfolio with return and risk qualities that reflect the
profile of this fund.

Risk level

Aggressive

Asset Management Charge

0.51% per annum (VAT included)

SANLAM GENERAL EQUITY FUND

Objective

The fund seeks maximum capital growth over the medium to long term by investing in selected shares
across all the major sectors of the JSE. This fund is suitable for investors wanting a well-balanced
portfolio and do not have expert knowledge of the stock exchange.

Unit Trust class

Equity – General

Asset class

Equity

Asset Management Charge

0.40% per annum (VAT included)

SANLAM DEFENSIVE FUND OF FUNDS

Objective

The fund invests in a balanced and diversified portfolio of collective investments which invests in sectors
or shares with sound growth potential in order to achieve stable income and capital growth.

Unit Trust class

Asset Allocation – Targeted Absolute and Real Return

Risk level

Conservative

Asset Management Charge

0.40% per annum (VAT included)




GE 8/2006                                          BV 10
SANLAM BOND FUND

Objective

An investment in the Bond Fund shares in the full market value growth of the assets in this fund. The
Bond Fund invests in South African bonds, fixed interest investments and cash.

Unit Trust class

Fixed interest – bonds

Asset class

Bonds

Asset Management Charge

0.68% per annum (VAT included)

SANLAM PROPERTY FUND

Objective

An investment in the Property Fund shares in the full market value growth of the assets in this fund. The
fund invests mainly in property related equities and cash.

Unit Trust class

Property

Asset class

Property

Asset Management Charge

0.68% per annum (VAT included)

SANLAM BALANCED FUND

Objective

This fund invests in a wide spectrum of investments in the equity, bond, money and property markets in
order to maximise total returns over the long term.

Unit Trust class

Asset Allocation – Prudential

Risk level

Moderate

Asset Management Charge

0.40% per annum (VAT included)




GE 8/2006                                        BV 11
SANLAM MONEY MARKET FUND

Objective

This fund invests in cash instruments, seeks to maximise interest income, preserve the fund’s capital
and provide immediate liquidity.

Asset class

Cash

Asset Management Charge

0.57% per annum (VAT included)

SANLAM INFLATION LINKED FUND

The fund invests in the flexible combination of investments in the equity, gilt and money markets, both
locally and abroad, aiming for maximum positive returns (comprising capital and income growth) over
the long term.

Unit Trust class

Asset Allocation – Targeted Absolute and Real Return

Risk level

Cautious

Asset Management Charge

0.40% per annum (VAT included)

SANLAM INTERNATIONAL DEFENSIVE FUND OF FUNDS

Objective

This fund has a diversified portfolio in terms of asset classes and has a high exposure in less volatile
asset classes such as cash and fixed interest securities. The fund is suitable for investors that want to
invest in international markets but choose to do so through a less volatile and lower risk option. It aims
to provide investors with long term capital preservation and capital growth qualities in dollar terms.

Unit Trust class

Global Funds

Risk level

Cautious (in the offshore currency)

Asset Management Charge

1.14% per annum (VAT included)




GE 8/2006                                         BV 12
SANLAM MULTI MANAGED EQUITY FUND OF FUNDS

Objective

The fund invests in a portfolio of collective investment schemes in order to secure growth of capital for
its unitholders over the long term. The fund will invest predominantly in selected sector and theme
funds in order to maximise returns. The fund is ideally suited to the investor striving for optimum capital
growth through an investment in a wide range of unit trusts focusing strongly on aggressive capital
growth. Investors in this fund should be willing to accept a higher though calculated risk.

Unit Trust class

Equity – General

Asset class

Equity

Asset Management Charge

0.40% per annum (VAT included)

SANLAM MULTI MANAGED BALANCED FUND OF FUNDS

Objective

The fund invests in a portfolio of collective investments or approved international funds to seek steady
growth of capital and income. The fund is managed within moderate investment parameters.

Unit Trust class

Asset Allocation – Prudential

Risk level

Moderate

Asset Management Charge

0.40% per annum (VAT included)

SANLAM VALUE FUND

Objective

The fund has the primary objective of growth, by investing in a medium with a reasonable level of
current income and relative stability for capital. The fund focuses on achieving this objective by
investing in financially sound companies which offer exceptional value. These include shares with a low
price to earnings ratio, shares trading at a discount to their net asset value, and shares whose prices do
not reflect future earnings potential.

Unit Trust class

Equity – Value

Asset class

Equity

Asset Management Charge

0.68% per annum (VAT included)



GE 8/2006                                         BV 13
OLD MUTUAL DYNAMIC FLOOR FUND

Objective

This fund strives for long-term capital growth as well as some level of capital protection. Through the
use of a quantitative risk model, the fund aims to profit from a rising share market and protect against
capital losses in a weak market. The fund invests across shares, bonds and cash – moving from shares
into fixed interest investments when the fund's value drops below a predetermined "floor". When
markets start to move up, the fund increases its holdings in shares, tapping into these growth
opportunities. The fund aims to protect at least 90% of the net investment over a 12-month period.

The fund is ideally suited to the more risk-averse investor whose priority is capital preservation but who
still wants to participate in upside market growth.

Unit Trust class

Asset Allocation – Targeted Absolute real return

Risk level

Cautious

Asset Management Charge

1.14% per annum (VAT included)

OLD MUTUAL ENHANCED INCOME FUND

Objective

The fund aims to offer a relatively high sustainable level of income and as well as seeking opportunities
to maximise capital gains. Income is derived from a range of interest-bearing assets, including
exposure when appropriate to listed property shares. Capital growth is generated from exposure to
bonds and property shares.

The fund is suitable for investors needing a relatively high level of income together with some capital
appreciation. These are investors who are able to live with volatility in income distribution levels.

Unit Trust class

Fixed interest – Varied specialist

Risk level

Conservative

Asset Management Charge

0.86% per annum (VAT included)




GE 8/2006                                          BV 14
NEDBANK MANAGED FUND

Objective

This fund aims to generate returns in excess of inflation over the long term, at below average risk levels.
In the short term, the fund aims to limit capital losses. The fund may invest across all asset classes, but
within the prudential investment guidelines. Although the fund is equity centric, it is able to hold cash,
bonds, listed property and offshore assets. The fund is ideal for investors seeking real returns over the
medium to long term.

Unit Trust class

Asset Allocation – Prudential

Risk level

Moderate

Asset Management Charge

1.17% per annum (VAT included)

NEDBANK RAINMAKER FUND

Objective

This fund aims to achieve superior medium- to long-term capital growth through careful stock selection
and exposure to selected themes within the equity market, both locally and abroad.

Unit Trust class

Equity – General

Asset class

Equity

Asset Management Charge

1.17% per annum (VAT included)

INVESTEC EQUITY FUND

Objective

This fund has as its primary objective steady growth of income and capital and a reasonable level of
current income and stability for capital invested. Its mandate is not restrictive and the fund invests in
both growth and value companies. The fund is committed to offering investors top-quartile, longer-term
performance. Through a robust investment process, the portfolio will focus on established companies,
as well as companies with superior growth potential that is not yet recognised by the market.

Unit Trust class

Equity – General

Asset class

Equity

Asset Management Charge

1.43% per annum (VAT included)




GE 8/2006                                         BV 15
INVESTEC MANAGED FUND

Objective

This fund seeks to secure stable growth of income and capital across a range of security classes in a
balanced manner, and a reasonable level of current income. The fund invests conservatively in a
spread of the key asset categories: equities, bonds and cash, with the objective of providing steady
long-term capital growth. The allocation across these asset categories is actively managed and altered
according to market conditions.

Unit Trust class

Asset Allocation – Prudential

Risk level

Moderate

Asset Management Charge

1.43% per annum (VAT included)

INVESTEC CAUTIOUS MANAGED FUND

Objective

The fund aims to provide investors with returns in excess of inflation comprising both capital and income
over the medium term. It will achieve this by diversifying across various asset classes, including
equities, bonds, cash and listed property. The moderate to low risk profile will be achieved by typically
limiting the equity exposure to 40% and using a value biased equity investment philosophy.

The low risk of capital loss will appeal to conservative investors. It can also be used as a core portfolio
holding around which more risky investments are added.

Unit Trust class

Asset Allocation – Prudential

Risk level

Cautious

Asset Management Charge

1.43% per annum (VAT included)




GE 8/2006                                         BV 16
FUTUREGROWTH ALBARAKA EQUITY FUND

Objective

This fund provides investors with a well-balanced equity portfolio designed to provide medium- to long-
term capital growth at a high level of risk.

The fund is strictly managed in accordance with Shari'ah Law and therefore does not invest in shares
that have an association with alcohol, gambling, non-halaal foodstuffs or interest-bearing instruments.

Unit Trust class

Equities – General

Asset class

Equity

Asset Management Charge

1.71% per annum (VAT included)

FRATERS FLEXIBLE FUND

Objective

This fund aims to maximise total returns and align the investment objectives of the investor, the fund
manager and the asset management company. The fund houses the investments of Fraters'
management. The asset manager accepts a degree of market risk, but view returns in absolute terms.
As a result, this fund has been designed to operate as flexibly as possible within the constraints of the
South African market. The fund is actively managed and is able to invest in equities, fixed interest,
listed property and cash.

Unit Trust class

Asset Allocation – Flexible

Risk level

Moderate

Asset Management Charge

1.71% per annum (VAT included)

FOORD EQUITY FUND

Objective

The objective of the fund is to earn a higher total rate of return than that of the average of the South
African equity market as represented by the FTSE/JSE All Share index including income, without
assuming greater risk.

Unit Trust class

Equities – General

Asset class

Equity

Asset Management Charge

1.71% per annum (VAT included)

GE 8/2006                                        BV 17
CORONATION OPTIMUM GROWTH FUND

Objective

This fund aims to deliver long-term growth by investing in a combination of local and international
investments across all asset classes.

Unit Trust class

Asset Allocation – Flexible

Risk level

Moderate

Asset Management Charge

1.14% per annum (VAT included)

CORONATION STRATEGIC INCOME FUND

Objective

This fund aims to provide high income with greater diversification than a pure income fund as well as to
seek opportunities to maximise capital gains whilst retaining a focus on capital preservation. The fund is
a highly diversified, actively managed fund investing in quality income generating instruments.

Unit Trust class

Fixed Interest – Varied Specialist

Risk level

Conservative

Asset Management Charge

1.14% per annum (VAT included)

ALLAN GRAY BALANCED FUND

Objective

This fund’s investment strategy is to earn a higher rate of return than the market value-weighted
average of the domestic medium equity prudential unit trust sector excluding the Allan Gray Balanced
Fund, without assuming any greater risk of monetary loss.

Unit Trust class

Asset Allocation – Prudential

Risk level

Moderate

Asset Management Charge

1.14% per annum (VAT included) (VAT included)




GE 8/2006                                         BV 18
ALLAN GRAY EQUITY FUND

Objective

This fund aims to earn a higher total rate of return than that of the average of the South African equity
market as represented by the FTSE/JSE All Share index, including income, without assuming greater
risk. The fund invests in equities offering superior fundamental value. The fund manager's experience
is that equity investing based on this "value approach" offers not only higher returns over the long term,
but also less risk of loss. Superior value is determined by comparing the price of the share to its intrinsic
or underlying value. The investment approach is long-term in nature and as such the fund does not
actively participate in short-term trading.

Unit Trust class

Equity – General

Asset class

Equity

Asset Management Charge

1.71% per annum (VAT included)

ALLAN GRAY STABLE FUND

Objective

This fund aims to provide a return that exceeds the return of bank deposits (both on after-tax basis) by a
few percent. The fund also seeks to provide a high level of capital stability. The risk of loss over any
two-year period is low.

Unit Trust class

Asset Allocation – Prudential

Risk level

Conservative

Asset Management Charge

1.14% per annum (VAT included)




GE 8/2006                                          BV 19
MINIMUM PAYMENTS PER INVESTMENT FUND

In addition to the minimum payments applicable per product, further minimums apply with regard to the
chosen investment fund(s).

If the total payment for the plan is less than R300,00 per month, the following investment funds can be
chosen:

   −   SIM Managed Conservative Solution
   −   SIM Managed Cautious Solution
   −   SIM Managed Moderate Solution
   −   SIM Managed Moderately Aggressive Solution
   −   SIM Managed Aggressive Solution
   −   Sanlam Balanced Fund
   −   Sanlam Bond Fund
   −   Sanlam Defensive Fund of Funds
   −   Sanlam General Equity Fund
   −   Sanlam Inflation Linked Fund
   −   Sanlam International Defensive Fund of Funds
   −   Sanlam Money Market Fund
   −   Sanlam Multi Managed Balanced Fund of Funds
   −   Sanlam Multi Managed Equity Fund of Funds
   −   Sanlam Property Fund
   −   Sanlam Value Fund

If the total payment for the plan is R300,00 per month or more, the above-mentioned funds, as well as
the following funds are available:

   −   Old Mutual Dynamic Floor Funds
   −   Old Mutual Enhanced Income Fund
   −   Nedbank Managed Fund
   −   Nedbank Rainmaker Fund
   −   Investec Cautious Managed Fund
   −   Investec Equity Fund
   −   Investec Managed Fund
   −   Futuregrowth Albaraka Equity Fund
   −   Fraters Flexible Fund
   −   Foord Equity Fund
   −   Coronation Optimum Growth Fund
   −   Coronation Strategic Income Fund
   −   Allan Gray Balanced Fund
   −   Allan Gray Equity Fund
   −   Allan Gray Stable Fund

The minimum allocation per investment fund is R50,00 for all the above funds, as is the case with
Stratus products.




GE 8/2006                                       BV 20
                                                              SECTION BW


                                                    HALALA SAVINGS PLAN


                                                                                                                            Page

DESCRIPTION ................................................................................................                BW1
REMUNERATION ...........................................................................................                    BW1
INVESTMENT FUNDS ....................................................................................                       BW1
INITIAL TERM .................................................................................................              BW1
LIFE INSURED ...............................................................................................                BW1
POLICYHOLDER ............................................................................................                   BW1
OPTION DATE ................................................................................................                BW1
DEATH BENEFIT ............................................................................................                  BW2
PREMIUM ........................................................................................................            BW2
FREQUENCY .................................................................................................                 BW2
MODE OF PAYMENT ....................................................................................                        BW2
AGE OF LIFE INSURED AT ENTRY .............................................................                                  BW2
PREMIUM GROWTH ......................................................................................                       BW2
CHARGES ......................................................................................................              BW2
− MARKETING AND ADMINISTRATION CHARGE ...................................................                                   BW2
− POLICY FEE ............................................................................................................   BW2
− SERVICE FEE .........................................................................................................     BW2
− FUND MANAGEMENT FEE ....................................................................................                  BW3
− BUY/SELL SPREAD ...............................................................................................           BW3
− COMPULSORY CHARGES ....................................................................................                   BW3
− PERFORMANCE FEE .............................................................................................             BW3
FULL OR PARTIAL CASH WITHDRAWALS .................................................                                          BW3
LOANS ............................................................................................................          BW3
NOMINEES FOR POLICY-OWNERSHIP .......................................................                                       BW3
BENEFICIARIES ............................................................................................                  BW3
CESSIONS ......................................................................................................             BW4
COOLING-OFF PERIOD .................................................................................                        BW4
ADMINISTRATIVE INFORMATION ................................................................                                 BW4




GE 6/2005                                                              BW
                                          HALALA SAVINGS PLAN



     DESCRIPTION

The Halala Savings Plan is an endowment policy with a low minimum premium, aimed at providing a
savings tool for the low-income group. The product is sold via Sanlam Direct and intermediaries.

    REMUNERATION

The commission scales for the Halala Savings Plan differ from those for normal endowment policies.

Primary commission payable at issuing :         1,5% x annual premium x commission term
                                                Maximum commission term = 10 years

Secondary commission in year two :              ¹/3 x primary commission

A maximum of two intermediaries are allowed to split the commission on a policy.

The primary and secondary commission vest according to legislation.


    INVESTMENT FUNDS

Only the following investment funds are available:

•     Vesting Bonus Fund
•     Guaranteed Capital Fund
•     Balanced Fund (Low equity) with 0% investment guarantee

Switches to other investment funds are not permitted.


    INITIAL TERM

The client chooses an initial term when the policy is taken out.

    Minimum initial term     : 5 years
    Maximum initial term     : 20 years

After the initial term has expired, the term is open-ended. This means that the policy will not be paid out
automatically after the initial term has expired, but will continue until the policyholder claims the
proceeds.

    LIFE INSURED

•     Only one life insured is permitted. This applies to new proposals, as well as after cessions.
•     The life insured need not be the same person as the policyholder.


    POLICYHOLDER

•     Only an individual may be the policyholder on new proposals.
•     Only one policyholder is permitted on a policy.

    OPTION DATE

The client chooses an initial term when the policy is taken out. The date at the end of the initial term is
the option date.


GE 6/2005                                            BW1
  DEATH BENEFIT

At death of the life insured, the value of the policy investment, as on the date on which Sanlam Life
receives notice of the death, will be payable.


  PREMIUM

Minimum     : R 80,00 for terms 10 years and longer
            : R200,00 for terms 5 years up to and including 9 years
There is no maximum premium.

  FREQUENCY

Premiums may only be paid on a monthly basis.

  MODE OF PAYMENT

Only debit orders are allowed. Although the client may pay the first recurring premium in cash, Sanlam
Life prefers intermediaries to limit this, as the manual administration to collect these smaller cash
premiums does not justify the administration costs involved.


  AGE OF LIFE INSURED AT ENTRY

 Minimum       : 1 age next birthday
 Maximum       : 60 age next birthday


  PREMIUM GROWTH

Premium growth is optional. Only fixed growth of 6% or 10% is available.

  CHARGES

Policy charges are used to among others, pay for policy expenses, which may change from time to time.
Therefore, Sanlam Life may, from time to time, in addition to the increase with the inflation rate, change
any of the policy charges below, and also change the way they recover any of these policy charges.

The policy charges are currently the following:

MARKETING AND ADMINISTRATION CHARGE

For recurring premiums payable in the first year, Sanlam Life will recover a marketing and administration
charge. This charge includes the commission, thus recovered over 12 months. The period of recovery
should be differentiated from the vesting period, which in terms of the law takes place over 24 months.

POLICY FEE

Each month Sanlam Life recovers a policy fee by cancelling units to the value of the fee, which is
currently R2,00.

SERVICE FEE

For the duration of the policy, Sanlam Life recovers an annual service fee, currently 0,50% of the market
value of the assets in the fund. This fee is calculated on a daily basis, which means that it is divided by
365, and this is taken into account when Sanlam Life calculates the daily prices of the units.




GE 6/2005                                          BW2
FUND MANAGEMENT FEE

For the duration of the policy, Sanlam Life will also recover an annual fund management fee, calculated
as a percentage of the value of the assets in the fund and which depends on the investment fund
chosen. This fee is also calculated on a daily basis, which means that it is divided by 365, and this is
taken into account when Sanlam Life calculates the daily prices of the units.

BUY/SELL SPREAD

The difference between the buying and selling prices on the same date is currently 2%.

COMPULSORY CHARGES

Before Sanlam Life calculates the daily prices of the units, it will recover statutory charges and
stockbroker fees, as applicable in each country in which investments are made, from the market value of
the assets in the fund.

PERFORMANCE FEE

Sanlam Life will recover a performance fee for the fund manager if the investment return of the fund is in
excess of the benchmark for that fund. This fee is taken into account when Sanlam Life calculates the
daily prices of the units.


    FULL OR PARTIAL CASH WITHDRAWALS

•    There is no waiting period as long as the policy has build up a positive cash value.
•    During the first 5 years only one full or partial withdrawal is allowed.
•    A termination fee is levied if a full or partial cash withdrawal is made before the option date. At
     present, the termination fee for a withdrawal before the option date is R225,00 plus 2% of the
     amount that is withdrawn (for both full and partial cash withdrawals). The fee can be adjusted from
     time to time.

    LOANS

•    Loans are available after the waiting period of two months, provided that the policy has a positive
     surrender value.
•    Minimum loan amount R2 000.
•    A fund value of at least R2 500 must remain after the loan has been taken.
•    Currently a loan charge of R225,00 plus 2% of the loan amount plus fees will be charged if the loan
     is made before the option date. After the option date the loan charge is R225,00. Sanlam Life may
     change this at any time.


    NOMINEES FOR POLICY-OWNERSHIP

If the life insured and the policyholder are not the same person, the policyholder may appoint a nominee
for policy-ownership to become the new owner of the policy in the event of the policyholder’s death.
This ensures that the policy can continue for the full chosen term, should the policyholder die before the
end of that term.


    BENEFICIARIES

The policyholder may appoint any number of beneficiaries to receive the benefits in the event of the
death of the life insured. If the policyholder and life insured are different people, it would be more
relevant to appoint a nominee for policy-ownership instead of a beneficiary, except if the policy-owner
wishes that someone else than him/herself should receive the death benefit at the death of the life
insured - even though the policy-owner is still alive at that stage.



GE 10/2005                                          BW3
  CESSIONS

The policy may be ceded to individuals or institutions.


  COOLING-OFF PERIOD

The normal cooling-off period of 30 days applies. Please see Section AA for full particulars.


  ADMINISTRATIVE INFORMATION

 Proposal form         The item number is AEB2011. Proposal forms are available:
                       •   on Lotus Notes,
                       •   on the Advisers' and Brokers' Web.
 Proposals             Intermediaries             Proposals for new policies can be sent to and
                                                  processed via the normal New Business channels for
                                                  Stratus products.
                       Direct marketing           Direct marketing takes place via advertisements in the
                                                  press and mail offers sent by Sanlam Direct. The
                                                  following channels are available for proposals resulting
                                                  from direct marketing:
                                                  •   Complete the proposal form from an advertisement
                                                      or drawn from the web site, and mail it to Freepost
                                                      No CB3008, Sanlam Direct, Sanlamhof 7532.
                                                  •   Complete the proposal form and fax it to
                                                      0860 22 66 44.
                                                  •   Call 0860 22 33 90 and an assistant will fill in the
                                                      proposal form over the telephone.
 Quotations            SanQuote
 Enquiries             Product enquiries          Sanlam Personal Finance :           (021) 916-3082
                                                  Client Solutions : Product
                                                  Support
                       General new business       New Business: Helpline              (021) 916-3600
                       enquiries
                       Commission                 Distribution:                       (021) 947-5002
                       enquiries                  Commission Support




GE 8/2006                                          BW4
                            SECTION BX



                            STRATUS

                                                          Page

A. STRATUS RANGE OF PRODUCTS
STRATUS ENDOWMENT ………………………………………………………...                BX1
STRATUS INTERNATIONAL ENDOWMENT ………………………………….            BX7
STRATUS EDUFOCUS ……………………………………………………………                  BX15
STRATUS SINKING FUND ……………………………………………………….               BX20
STRATUS CONTINUATIONS WITH OR WITHOUT LIFE INSURED ……….   BX24
STRATUS RETIREMENT ANNUITY …………………………………………….             BX29
STRATUS INTERNATIONAL RETIREMENT ANNUITY ……………………..       BX35
STRATUS RETIREMENT ANNUITY CONTINUATIONS ……………………..       BX42
STRATUS INVESTMENT LINKED PENSION …………………………………           BX45
STRATUS INTERNATIONAL INVESTMENT LINKED PENSION …………..    BX48
STRATUS COMPOSITE ANNUITY ……………………………………………..             BX51
STRATUS WITH PRESERVATION FUNDS ……………………………………            BX54
STRATUS WITH PRESERVATION PENSION FUNDS CONTINUATIONS
AND STRATUS WITH PRESERVATION PROVIDENT FUNDS
CONTINUATIONS ………………………………………………………………….                  BX61
STRATUS ENDOWMENT FOR PROVIDENT FUNDS ………………………..         BX64
STRATUS GUARANTEED INCOME …………………………………………….              BX75
STRATUS GUARANTEED RETURN ……………………………………………               BX78
STRATUS GUARANTEED INVESTMENT ……………………………………..            BX81
STRATUS GUARANTEED PROPERTY INVESTMENT ……………………..         BX87
STRATUS TRADED POLICIES …………………………………………………               BX92

B. STRATUS PREMIER RANGE OF PRODUCTS
MINIMUM PREMIUM ……………………..……………………………………….                BX95
AVAILABLE INVESTMENT FUNDS …………………………………………….             BX95

C. FEATURES OF STRATUS
1. INVESTMENT FUNDS ………………………………………………                    BX96
1.1 FUNDS AVAILABLE FOR STRATUS AND STRATUS PREMIER …….   BX96
1.2 FUNDS AVAILABLE FOR STRATUS PREMIER ONLY ………………..     BX110


                                                           2/…




GE 8/2006                       BX
                                      -2-
                                                          Page


 C. FEATURES OF STRATUS (continued)
 2. AVAILABILITY OF PRICES ……………………………..…….….             BX124
 3. SWITCHING AND REDIRECTIONS …………..….….………….            BX124
 4. INVESTMENT GUARANTEES …………….………….………….                BX124
 5. ENDOWMENT OPTION FOR RETIREMENT ANNUITIES AND
     PRESERVATION FUNDS ...……………………………………..               BX125
 6. STRATUS LIFETIME INVESTMENT OPTION ………………….           BX126

 D. STRATUS RIDER BENEFITS
 WAIVER OF PREMIUM AT DISABILITY (OPG, OGG) ……………         BX129
 WAIVER OF PREMIUM AT DEATH (DP, DG) ………………………            BX133

 E. SUMMARIES
 1. AVAILABLE INVESTMENT FUNDS PER PRODUCT ………...         BX135
 2. MINIMUM PREMIUMS AND TABLE CODES ………..…...……          BX144

 F. ADDITIONAL INFORMATION ABOUT RETIREMENT ANNUITIES …   BX145




GE 8/2006                             BX
                                                        SECTION BX


                                                        STRATUS

                                                                                                                Page
 A. STRATUS RANGE OF PRODUCTS
 STRATUS ENDOWMENT ....................................…..................................                      BX1
 − DESCRIPTION ……………………..……………………..………………………….                                                                  BX1
 − INITIAL TERM …........................................................................................……..   BX1
 − THE OPTION DATE …………………………………………………………………                                                                    BX1
 − AMOUNT ON OPTION DATE .............................................……………....…….                              BX2
 − AVAILABLE INVESTMENT FUNDS ..................................................................                BX2
 − SWITCHING BETWEEN INVESTMENT FUNDS …………………………………                                                             BX2
 − INVESTMENT GUARANTEES …………..………………………………………….                                                                BX2
 − THE INVESTMENT GUARANTEE DATE ……………………..…………………..                                                            BX2
 − PREMIUMS ……………………………………………………………………………                                                                       BX2
 − INCEPTION DATE ……………………………………………………………………                                                                    BX3
 − AGE AT ENTRY ………………………………………………………………………                                                                     BX4
 − PREMIUM GROWTH ………………………………………………………………...                                                                   BX4
 − RIDER BENEFITS ……………………………………………………………………                                                                    BX4
 − LIFE COVER AND DISABILITY BENEFITS ……………………………………….                                                          BX4
 − DEATH BENEFIT ……………………………………………………………………..                                                                   BX4
 − FULL OR PARTIAL CASH WITHDRAWAL ………………………………………..                                                            BX5
 − LOANS …………………………………………………………………………………                                                                        BX5
 − MAKING PAID-UP ……………………………………………………………………                                                                    BX5
 − ALTERATIONS ……………………………………………………………………….                                                                     BX5
 − BENEFICIARY TO RECEIVE DEATH BENEFITS ………………………………..                                                         BX6
 − POLICY-OWNERSHIP ……………………………………………………………….                                                                   BX6
 − CESSIONS …………………………………………………………………………….                                                                      BX6
 − TAX …………………………………………………………………………………….                                                                        BX6

 STRATUS INTERNATIONAL ENDOWMENT ............…............................                                      BX7
 − DESCRIPTION ……………………..……………………..………………………….                                                                  BX7
 − INVESTMENT PROCESS …………………………………………………………..                                                                  BX7
 − INITIAL TERM …........................................................................................……..   BX7
 − THE OPTION DATE …………………………………………………………………                                                                    BX7
 − AMOUNT ON OPTION DATE .............................................……………....…….                              BX7
 − CONDITIONS TO QUALIFY FOR THE PRODUCT ………………………………                                                           BX8
 − AVAILABLE INVESTMENT FUNDS ..................................................................                BX8
 − SWITCHING BETWEEN INVESTMENT FUNDS …………………………………                                                             BX8
 − INVESTMENT GUARANTEES …………..………………………………………….                                                                BX8
 − PREMIUMS ……………………………………………………………………………                                                                       BX8
 − INCEPTION DATE ……………………………………………………………………                                                                    BX9
 − AGE AT ENTRY ………………………………………………………………………                                                                     BX9
 − PREMIUM GROWTH ………………………………………………………………...                                                                   BX9
 − RIDER BENEFITS ……………………………………………………………………                                                                    BX9
                                                                                                                2/...


GE 2/2006                                                        BX
                                                                 -2-
                                                                                                                Page


 STRATUS INTERNATIONAL ENDOWMENT (continued)
 − LIFE COVER AND DISABILITY BENEFITS ……………………………………….                                                          BX9
 − DEATH BENEFIT ……………………………………………………………………..                                                                   BX10
 − FULL OR PARTIAL CASH WITHDRAWAL ………………………………………..                                                            BX10
 − LOANS …………………………………………………………………………………                                                                        BX10
 − PAYMENT OF ANY BENEFITS …………………………………………………….                                                                BX10
 − MAXIMUM ALLOWANCE …………………………………………………………..                                                                   BX11
 − CHOICES IF THE TAX CLEARANCE CERTIFICATE IS NO LONGER
   GRANTED …………………………………………………………………………….                                                                       BX11
 − MAKING PAID-UP ……………………………………………………………………                                                                    BX12
 − ALTERATIONS ……………………………………………………………………….                                                                     BX12
 − BENEFICIARY TO RECEIVE DEATH BENEFITS ………………………………..                                                         BX12
 − POLICY-OWNERSHIP ……………………………………………………………….                                                                   BX12
 − CESSIONS …………………………………………………………………………….                                                                      BX13
 − TAX …………………………………………………………………………………….                                                                        BX14

 STRATUS EDUFOCUS .….....................…................................................                      BX15
 − DESCRIPTION ……………………..……………………..………………………….                                                                  BX15
 − INITIAL TERM …........................................................................................……..   BX15
 − THE OPTION DATE …………………………………………………………………                                                                    BX15
 − AMOUNT ON OPTION DATE .............................................……………....…….                              BX15
 − AVAILABLE INVESTMENT FUNDS ..................................................................                BX16
 − SWITCHING BETWEEN INVESTMENT FUNDS …………………………………                                                             BX16
 − INVESTMENT GUARANTEES …………..………………………………………….                                                                BX16
 − THE INVESTMENT GUARANTEE DATE ……………..…………………………..                                                            BX16
 − PREMIUMS ……………………………………………………………………………                                                                       BX16
 − INCEPTION DATE ……………………………………………………………………                                                                    BX17
 − AGE AT ENTRY ………………………………………………………………………                                                                     BX17
 − PREMIUM GROWTH ………………………………………………………………...                                                                   BX17
 − RIDER BENEFITS ……………………………………………………………………                                                                    BX18
 − LIFE COVER AND DISABILITY BENEFITS ……………………………………….                                                          BX18
 − DEATH BENEFIT ……………………………………………………………………..                                                                   BX18
 − FULL OR PARTIAL CASH WITHDRAWAL ………………………………………..                                                            BX18
 − LOANS …………………………………………………………………………………                                                                        BX18
 − MAKING PAID-UP ……………………………………………………………………                                                                    BX19
 − ALTERATIONS ……………………………………………………………………….                                                                     BX19
 − BENEFICIARY TO RECEIVE DEATH BENEFITS ………………………………..                                                         BX19
 − POLICY-OWNERSHIP ……………………………………………………………….                                                                   BX19
 − TAX …………………………………………………………………………………….                                                                        BX19




                                                                                                                3/...



GE 2/2006                                                        BX
                                                                 -3-
                                                                                                                Page


 STRATUS SINKING FUND .….......................................…........................                        BX20
 − DESCRIPTION ……………………..……………………..………………………….                                                                  BX20
 − INITIAL TERM …........................................................................................……..   BX20
 − THE OPTION DATE …………………………………………………………………                                                                    BX20
 − AMOUNT ON OPTION DATE .............................................……………....…….                              BX20
 − AVAILABLE INVESTMENT FUNDS ..................................................................                BX21
 − SWITCHING BETWEEN INVESTMENT FUNDS …………………………………                                                             BX21
 − INVESTMENT GUARANTEES …………..………………………………………….                                                                BX21
 − THE INVESTMENT GUARANTEE DATE ……..…………………………………..                                                            BX21
 − PREMIUMS ……………………………………………………………………………                                                                       BX21
 − INCEPTION DATE ……………………………………………………………………                                                                    BX21
 − AGE AT ENTRY ………………………………………………………………………                                                                     BX21
 − RIDER BENEFITS ……………………………………………………………………                                                                    BX21
 − LIFE COVER AND DISABILITY BENEFITS ……………………………………….                                                          BX21
 − DEATH BENEFIT ……………………………………………………………………..                                                                   BX21
 − FULL OR PARTIAL CASH WITHDRAWAL ………………………………………..                                                            BX22
 − LOANS …………………………………………………………………………………                                                                        BX22
 − ALTERATIONS …..……………………………………………………………………                                                                    BX22
 − BENEFICIARY TO RECEIVE DEATH BENEFITS ………………………………..                                                         BX22
 − POLICY-OWNERSHIP ……………………………………………………………….                                                                   BX23
 − CESSIONS …………………………………………………………………………….                                                                      BX23
 − TAX …………………………………………………………………………………….                                                                        BX23

 STRATUS CONTINUATIONS WITH OR WITHOUT LIFE INSURED ..…..                                                       BX24
 − DESCRIPTION ……………………..……………………..………………………….                                                                  BX24
 − INITIAL TERM …........................................................................................……..   BX24
 − AVAILABLE INVESTMENT FUNDS ..................................................................                BX24
 − SWITCHING BETWEEN INVESTMENT FUNDS …………………………………                                                             BX24
 − INVESTMENT GUARANTEES …………..………………………………………….                                                                BX24
 − THE INVESTMENT GUARANTEE DATE …………………..……………………..                                                            BX24
 − PREMIUMS ……………………………………………………………………………                                                                       BX24
 − INCEPTION DATE ……………………………………………………………………                                                                    BX25
 − AGE AT ENTRY ………………………………………………………………………                                                                     BX25
 − PREMIUM GROWTH ………………………………………………………………...                                                                   BX25
 − RIDER BENEFITS ……………………………………………………………………                                                                    BX25
 − LIFE COVER AND DISABILITY BENEFITS ……………………………………….                                                          BX25
 − DEATH BENEFIT ……………………………………………………………………..                                                                   BX25
 − FULL OR PARTIAL CASH WITHDRAWAL ………………………………………..                                                            BX26
 − REGULAR CASH WITHDRAWALS ………………………………………………..                                                                BX26



                                                                                                                4/...




GE 2/2006                                                        BX
                                                                 -4-
                                                                                                                Page


 STRATUS CONTINUATIONS (continued)
 − LOANS …………………………………………………………………………………                                                                        BX27
 − ALTERATIONS ……………………………………………………………………….                                                                     BX28
 − BENEFICIARY TO RECEIVE DEATH BENEFITS ……………………………….                                                          BX28
 − POLICY-OWNERSHIP ………………………………………………………………                                                                    BX28
 − CESSIONS ……………………………………………………………………………                                                                       BX28
 − TAX …………………………………………………………………………………….                                                                        BX28

 STRATUS RETIREMENT ANNUITY .…....................................................                              BX29
 − DESCRIPTION ……………………..……………………..………………………….                                                                  BX29
 − INITIAL TERM …........................................................................................……..   BX29
 − THE OPTION DATE …………………………………………………………………                                                                    BX29
 − RETIREMENT BENEFIT AVAILABLE ON OPTION DATE ……………………..                                                       BX30
 − ENDOWMENT OPTION FOR RETIREMENT ANNUITIES .........................…..                                       BX30
 − AVAILABLE INVESTMENT FUNDS ..................................................................                BX30
 − SWITCHING BETWEEN INVESTMENT FUNDS …………………………………                                                             BX30
 − STRATUS LIFE TIME INVESTMENT OPTION …………………………………..                                                          BX30
 − INVESTMENT GUARANTEES …………..………………………………………….                                                                BX30
 − THE INVESTMENT GUARANTEE DATE …………………………..……………..                                                            BX30
 − CONTRIBUTIONS ……………………………………………………………………                                                                     BX31
 − INCEPTION DATE ……………………………………………………………………                                                                    BX31
 − AGE AT ENTRY AND RETIREMENT ………………………………..……………                                                              BX32
 − PREMIUM GROWTH ………………………………………………………………..                                                                    BX32
 − FLEXI GROWTH ……………………………………………………………………..                                                                    BX33
 − RIDER BENEFITS ……………………………………………………………………                                                                    BX33
 − LIFE COVER AND DISABILITY BENEFITS ……………………………………….                                                          BX33
 − DEATH BENEFIT ……………………………………………………………………..                                                                   BX33
 − BENEFITS AVAILABLE BEFORE AND AFTER THE OPTION DATE …………                                                     BX33
 − LOANS …………………………………………………………………………………                                                                        BX33
 − MAKING PAID-UP ……………………………………………………………………                                                                    BX33
 − ALTERATIONS …..……………………………………………………………………                                                                    BX34
 − APPOINTMENT OF NOMINEE(S) TO RECEIVE DEATH BENEFIT …………..                                                    BX34
 − COOLING-OFF PERIOD …………………………………………………………….                                                                  BX34
 − TAX …………………………………………………………………………………….                                                                        BX34




                                                                                                                5/...




GE 2/2006                                                        BX
                                                                 -5-
                                                                                                                Page


 STRATUS INTERNATIONAL RETIREMENT ANNUITY .…......................                                              BX35
 − DESCRIPTION ……………………..……………………..………………………….                                                                  BX35
 − INVESTMENT PROCESS …………………………………………………………..                                                                  BX35
 − INITIAL TERM …........................................................................................……..   BX35
 − THE OPTION DATE …………………………………………………………………                                                                    BX35
 − RETIREMENT BENEFIT AVAILABLE ON OPTION DATE ……………………..                                                       BX36
 − CONDITIONS TO QUALIFY FOR THE PRODUCT ………………………………                                                           BX36
 − AVAILABLE INVESTMENT FUNDS ..................................................................                BX36
 − SWITCHING BETWEEN INVESTMENT FUNDS …………………………………                                                             BX36
 − INVESTMENT GUARANTEES …………..………………………………………….                                                                BX36
 − CONTRIBUTIONS ……………………………………………………………………                                                                     BX36
 − INCEPTION DATE ……………………………………………………………………                                                                    BX37
 − AGE AT ENTRY AND RETIREMENT ………………………………..……………                                                              BX38
 − PREMIUM GROWTH ………………………………………………………………..                                                                    BX38
 − RIDER BENEFITS ……………………………………………………………………                                                                    BX38
 − DEATH BENEFIT ……………………………………………………………………..                                                                   BX38
 − BENEFITS AVAILABLE BEFORE AND AFTER THE OPTION DATE …..……                                                    BX39
 − LOANS …………………………………………………………………………………                                                                        BX39
 − PAYMENT OF BENEFITS …………………………………………………………..                                                                 BX39
 − MAXIMUM ALLOWANCE ……………………………………………………………                                                                    BX39
 − CHOICES IF THE TAX CLEARANCE CERTIFICATE IS NO LONGER
   GRANTED …………………………………………………………………………….                                                                       BX40
 − ALTERATIONS …..……………………………………………………………………                                                                    BX40
 − MAKING PAID-UP ……………………………………………………………………                                                                    BX40
 − APPOINTMENT OF NOMINEE(S) TO RECEIVE DEATH BENEFIT …………..                                                    BX41
 − COOLING-OFF PERIOD …………………………………………………………….                                                                  BX41
 − TAX …………………………………………………………………………………….                                                                        BX41

 STRATUS RETIREMENT ANNUITY CONTINUATIONS ….....................                                                BX42
 − DESCRIPTION ……………………..……………………..………………………….                                                                  BX42
 − INITIAL TERM ……....................................................................................……..      BX42
 − ENDOWMENT OPTION FOR RETIREMENT ANNUITIES ……………………..                                                         BX42
 − AVAILABLE INVESTMENT FUNDS …...............................................................                  BX42
 − SWITCHING BETWEEN INVESTMENT FUNDS …………………………………                                                             BX42
 − INVESTMENT GUARANTEES …………..………………………………………….                                                                BX42
 − THE INVESTMENT GUARANTEE DATE ………………………..………………..                                                            BX42
 − CONTRIBUTIONS ……………………………………………………………………                                                                     BX42
 − INCEPTION DATE ……………………………………………………………………                                                                    BX42
 − AGE AT ENTRY AND RETIREMENT ………………………………..……………                                                              BX43
 − PREMIUM GROWTH ………………………………………………………………..                                                                    BX43
 − FLEXI GROWTH ……………………………………………………………………..                                                                    BX43
 − RIDER BENEFITS ……………………………………………………………………                                                                    BX43


                                                                                                                6/…

GE 2/2006                                                        BX
                                                                 -6-
                                                                                                                Page


 STRATUS RETIREMENT ANNUITY CONTINUATIONS (continued)
 − LIFE COVER AND DISABILITY BENEFITS ………………………………………                                                           BX43
 − DEATH BENEFIT ……………………………………………………………………..                                                                   BX43
 − LOANS …………………………………………………………………………………                                                                        BX44
 − ALTERATIONS …..……………………………………………………………………                                                                    BX44
 − TAX …………………………………………………………………………………….                                                                        BX44

 STRATUS INVESTMENT LINKED PENSION .…………………................                                                     BX45
 − DESCRIPTION ……………………..……………………..………………………….                                                                  BX45
 − ADVANTAGES OF THE PRODUCT ……………………………………………….                                                                BX45
 − DISADVANTAGES OF THE PRODUCT ………………………………..…………                                                              BX45
 − INITIAL TERM ……....................................................................................……..      BX45
 − AVAILABLE INVESTMENT FUNDS …...............................................................                  BX46
 − SWITCHING BETWEEN INVESTMENT FUNDS …………………………………                                                             BX46
 − INVESTMENT GUARANTEES …………..………………………………………….                                                                BX46
 − PREMIUMS ……………………………………………………………………………                                                                       BX46
 − INCEPTION DATE ……………………………………………………………………                                                                    BX46
 − AGE AT ENTRY ………………………………………………………..……………                                                                    BX46
 − DEATH BENEFIT ……………………………………………………………………..                                                                   BX46
 − PENSION INSTALLMENTS …………………………………………………………                                                                  BX46
 − PHASING-IN OF PURCHASE SUM ………………………….……….……………                                                              BX47
 − LIVES INSURED ……………………………………………………………………..                                                                   BX47
 − APPOINTMENT OF NOMINEES ……………………………………………………                                                                 BX47
 − CESSIONS …………………………………………………………………………….                                                                      BX47
 − PRIVATE PENSION ………………………………………………………………….                                                                   BX47
 − ADMINISTRATION OF THE POLICY ……………………………………………..                                                             BX47
 − TRANSFER OF POLICY …………………………………………………………….                                                                  BX47
 − COOLING-OFF PERIOD …………………………………………………………….                                                                  BX47
 − TAX …………………………………………………………………………………….                                                                        BX47

 STRATUS INTERNATIONAL INVESTMENT LINKED PENSION ….........                                                     BX48
 − DESCRIPTION ……………………..……………………..………………………….                                                                  BX48
 − FEATURES OF THE PRODUCT …………………………………………………                                                                  BX48
 − INITIAL TERM …........................................................................................……..   BX48
 − AVAILABLE INVESTMENT FUNDS ..................................................................                BX48
 − SWITCHING BETWEEN INVESTMENT FUNDS …………………………………                                                             BX48
 − INVESTMENT GUARANTEES …………..………………………………………….                                                                BX48
 − PREMIUMS ……………………………………………………………………………                                                                       BX48
 − INCEPTION DATE ……………………………………………………………………                                                                    BX48
 − AGE AT ENTRY ………………………………………………………………………                                                                     BX49
 − DEATH BENEFIT ……………………………………………………………………..                                                                   BX49
 − PENSION INSTALLMENTS …………………………………………………………                                                                  BX49


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GE 2/2006                                                        BX
                                                                -7-
                                                                                                             Page


 STRATUS INTERNATIONAL INVESTMENT LINKED PENSION
  (continued)
 − NUMBER OF INSUREDS …………………………………………………….……..                                                              BX49
 − APPOINTMENT OF BENEFICIARIES ……………………………………………..                                                          BX50
 − PRIVATE PENSION ………………………………………………….………………                                                                BX50
 − COOLING-OFF PERIOD …………………………………………………………….                                                               BX50
 − POLICY DOCUMENTS ………………………………………………………………                                                                 BX50
 − TAX ……………………………………………………………………………………..                                                                    BX50

 STRATUS COMPOSITE ANNUITY ………………………………................                                                      BX51
 − DESCRIPTION ……………………..……………………..………………………….                                                               BX51
 − ADVANTAGES OF THE PRODUCT ……………………………………………….                                                             BX51
 − DISADVANTAGES OF THE PRODUCT ……………………………..……………                                                           BX51
 − INITIAL TERM ……....................................................................................……..   BX52
 − AVAILABLE INVESTMENT FUNDS …...............................................................               BX52
 − SWITCHING BETWEEN INVESTMENT FUNDS …………………………………                                                          BX52
 − INVESTMENT GUARANTEES …………..………………………………………….                                                             BX52
 − PREMIUMS ……………………………………………………………………………                                                                    BX52
 − AGE AT ENTRY ………………………………………………………..……………                                                                 BX52
 − DEATH BENEFIT ……………………………………………………………………..                                                                BX53
 − LIVES INSURED ……………………………………………………………………..                                                                BX53
 − TRANSFER OF POLICY …………………………………………………………….                                                               BX53
 − TAX …………………………………………………………………………………….                                                                     BX53

 STRATUS WITH PRESERVATION FUNDS …………….…………….........                                                        BX54
 − DESCRIPTION …………….………………………………………………………….                                                                 BX54
 − ALLOWABLE TRANSFERS …………………………………………………………                                                                BX55
 − INITIAL TERM …………………………………………………………………………                                                                 BX55
 − THE OPTION DATE ………………………………………………………………….                                                                BX56
 − ENDOWMENT OPTION FOR PRESERVATION FUNDS ……………………….                                                        BX56
 − AVAILABLE INVESTMENT FUNDS ………………………………………………..                                                           BX56
 − SWITCHING BETWEEN INVESTMENT FUNDS …………………………………                                                          BX56
 − STRATUS LIFE TIME INVESTMENT OPTION …………………………….…..…                                                      BX56
 − INVESTMENT GUARANTEES …………………………………………….……..…                                                             BX56
 − THE INVESTMENT GUARANTEE DATE ………………………………………….                                                           BX56
 − PREMIUMS ……………………………………………………………………………                                                                    BX56
 − INCEPTION DATE ……………………………………………………………………                                                                 BX56
 − AGE AT ENTRY AND RETIREMENT ………………………………………………                                                            BX57
 − RIDER BENEFITS ……………………………………………………………………                                                                 BX57
 − LIFE COVER AND DISABILITY BENEFITS ……………………………..………..                                                     BX57
 − DEATH BENEFIT ………………………………….…………………………………                                                                 BX57
 − RETIREMENT BENEFIT ………………………….…………………………………                                                               BX57


                                                                                                             8/…


GE 2/2006                                                      BX
                                   -8-
                                                             Page

 STRATUS WITH PRESERVATION FUNDS (continued)
 − WITHDRAWAL FROM PRESERVATION FUNDS ………………………………..         BX58
 − WITHDRAWAL BENEFIT ……………………………………………………………                BX58
 − LOANS …………………………………………………………………………………                     BX58
 − ADDITIONAL SINGLE PREMIUMS ………………………………………………..           BX59
 − CONVERSIONS ………………………………………………………………………                   BX59
 − CESSIONS ……………………………………………………………………………                    BX59
 − APPOINTMENT OF NOMINEE(S) TO RECEIVE BENEFIT ……………………     BX60
 − TAX …………………………………………………………………………………….                     BX60
 − YEARS OF SERVICE ………………………………………………………………..               BX60

 STRATUS WITH PRESERVATION PENSION FUNDS CONTINUATIONS
 AND STRATUS WITH PRESERVATION PROVIDENT FUNDS
 CONTINUATIONS …………………………………..…….…………….........              BX61
 − DESCRIPTION …………….………………………………………………………….                 BX61
 − INITIAL TERM …………………………………………………………………………                 BX61
 − ENDOWMENT OPTION WITH PRESERVATION FUND POLICIES …………..   BX61
 − AVAILABLE INVESTMENT FUNDS ………………………………………………..           BX61
 − SWITCHING BETWEEN INVESTMENT FUNDS …………………………………          BX61
 − INVESTMENT GUARANTEES ……………………………………………………..              BX61
 − THE INVESTMENT GUARANTEE DATE …………………………………………            BX61
 − CONTRIBUTIONS ……………………………………………………………………                  BX61
 − INCEPTION DATE ……………………………………………………………………                 BX61
 − AGE AT ENTRY AND RETIREMENT ………………………………………………            BX62
 − RIDER BENEFITS ……………………………………………………………………                 BX62
 − LIFE COVER AND DISABILITY BENEFITS ………………………………………        BX62
 − DEATH BENEFIT …………………………………………………………………….                 BX62
 − RETIREMENT BENEFIT ……………………………………………………………                BX62
 − WITHDRAWAL OUT OF A PRESERVATION FUND …………………………….        BX63
 − WITHDRAWAL BENEFIT ……………………………………………………………                BX63
 − LOANS …………………………………………………………………………………                     BX63
 − TAX …………………………………………………………………………………….                     BX63

 STRATUS ENDOWMENT FOR PROVIDENT FUNDS ……………………              BX64
 − FUNCTION OF A PROVIDENT FUND ……………………………………………            BX64
 − DESCRIPTION ……………………………………………………………………….                  BX64
 − WORKING OF THE CENTRAL PROVIDENT FUND ………………………..…..      BX64
 − REGISTRATION ………………………………………………………………………                  BX64
 − REGISTRATION FORMS ……………………………………………………………                BX65
 − MEMBERSHIP ………………………………………………………………………..                  BX65
 − LIFE INSURED ………………………………………………………………………..                BX65
 − POLICY-OWNER …………………………………………………………………….                  BX66

                                                             9/…




GE 2/2006                          BX
                                    -9-
                                                                Page

 STRATUS ENDOWMENT POLICY FOR PROVIDENT FUNDS (continued)
 − INITIAL TERM …………………………………………………………………………                    BX66
 − THE OPTION DATE ………………………………………………………………….                   BX66
 − RETIREMENT BENEFIT AVAILABLE ON THE OPTION DATE ………………..     BX66
 − AVAILABLE INVESTMENT FUNDS ………………………………………………..              BX66
 − SWITCHING BETWEEN INVESTMENT FUNDS …………………………………             BX66
 − STRATUS LIFETIME INVESTMENT OPTION ……………………………………            BX66
 − INVESTMENT GUARANTEES ……………………………………………………..                 BX67
 − THE INVESTMENT GUARANTEE DATE …………………………………………               BX67
 − CONTRIBUTIONS TO THE FUND …………………………………………………                BX67
 − MONITORING OF CONTRIBUTIONS ……………………………………………..              BX67
 − INCEPTION DATE ……………………………………………………………………                    BX68
 − AGE AT ENTRY AND RETIREMENT DATE ………………………………………             BX69
 − PREMIUM GROWTH ………………………………………………………………...                   BX69
 − RETIREMENT BENEFITS …………………………………………………………...                BX69
 − LIFE COVER AND DISABILITY BENEFITS ……………………………………….          BX69
 − DEATH BENEFIT ……………………………………………………………………..                   BX69
 − APPOINTMENT OF NOMINEE TO RECEIVE THE DEATH BENEFIT ….……..   BX69
 − RETIREMENT …………………………………………………………………………                      BX70
 − RESIGNATION OR RETRENCHMENT ……………………………………………                BX70
 − LOANS …………………………………………………………………………………                        BX70
 − MAKING PAID-UP ……………………………………………………………………                    BX71
 − CASH WITHDRAWAL ……………………………………………………………….                    BX71
 − ALTERATIONS ……………………………………………………………………….                     BX71
 − COOLING-OFF PERIOD …………………………………………………………….                  BX71
 − GENERAL AND ADMINISTRATIVE INFORMATION ……………………………           BX72

 STRATUS GUARANTEED INCOME …………………….…………….........              BX75
 − DESCRIPTION ………………….…………………………………………………….                    BX75
 − TERM …………………………………………………………………………………..                       BX75
 − PREMIUMS ……………………………………………………………………………                       BX75
 − INCEPTION DATE ……………………………………………………………………                    BX75
 − AGE AT ENTRY ………………………………………………………………………                     BX75
 − RATE DATE …………………………………………………………………………..                     BX75
 − INCOME PAYABLE ………………………………………………………………….                    BX76
 − DEATH BENEFIT ……………………………………………………………………                     BX76
 − FULL OR PARTIAL WITHDRAWAL ………………………………..………………              BX76
 − LOANS …………………………………………………………………………………                        BX77
 − BENEFICIARIES ……………………………………………………………………...                  BX77
 − NOMINEES FOR POLICY-OWNERSHIP ………………………………………….              BX77
 − CESSIONS …………………………………………………………………………….                      BX77
 − TAX …………………………………………………………………………………….                        BX77


                                                                10/…


GE 2/2006                           BX
                                     - 10 -
                                                                Page


 STRATUS GUARANTEED RETURN ………………………………….........               BX78
 − DESCRIPTION ……………………………………………………………………….                     BX78
 − TERM …………………………………………………………………………………..                       BX78
 − PREMIUMS ……………………………………………………………………………                       BX78
 − INCEPTION DATE ……………………………………………………………………                    BX78
 − AGE AT ENTRY ………………………………………………………………………                     BX78
 − RIDER BENEFITS ……………………………………………………………………                    BX78
 − RATE DATE …………………………………………………………………………..                     BX78
 − MATURITY BENEFIT ……………………………………………………………….                   BX78
 − DEATH BENEFIT …………………………………………………………………….                    BX79
 − LOANS …………………………………………………………………………………                        BX79
 − ALTERATIONS ……………………………………………………………………….                     BX79
 − APPOINTING OF BENEFICIARIES TO RECEIVE DEATH BENEFITS ……….   BX79
 − APPOINTING OF NOMINEES FOR POLICY-OWNERSHIP ……………………         BX79
 − CESSIONS …………………………………………………………………………….                      BX80
 − TAX ……………………………………………………………………………………                         BX80

 STRATUS GUARANTEED INVESTMENT …………………………..........             BX81
 − DESCRIPTION …………………..……………………………………………………                    BX81
 − TERM ………………………………………………………………………………….                        BX81
 − PREMIUMS ……………………………………………………………………………                       BX81
 − INCEPTION DATE …………………………..……………………………………….                  BX81
 − AGE AT ENTRY ………………………………………………………………………                     BX82
 − RIDER BENEFITS ……………………………………………………………………                    BX82
 − RATE DATE …………………………………………………………………………..                     BX82
 − INCOME PAYABLE ………………………………………………………………….                    BX82
 − MATURITY BENEFIT ………………………………………………………………..                  BX83
 − DEATH BENEFIT …………………………………………………………………….                    BX83
 − FULL OR PARTIAL CASH WITHDRAWAL ……………………………………….             BX84
 − LOANS …………………………………………………………………………………                        BX84
 − ALTERATIONS ……………………………………………………………………….                     BX84
 − APPOINTMENT OF BENEFICIARIES AS RECEIVE THE DEATH BENEFITS   BX85
 − NOMINEES FOR POLICY–OWNERSHIP ……………………….……………….              BX85
 − CESSIONS ……………………………………………………………………………                       BX86
 − TAX …………………..…………………………………………………………………                       BX86




                                                                11/…




GE 2/2006                            BX
                                   - 11 -
                                                              Page


 STRATUS GUARANTEED PROPERTY INVESTMENT ……………….…              BX87
 − DESCRIPTION …………………..……………………………………………………                  BX87
 − INITIAL TERM …………………………………………………………………………                  BX87
 − THE OPTION DATE ………………………………………………………………….                 BX87
 − AMOUNT ON OPTION DATE ………………………………………………………                BX87
 − CHANGE OF AMOUNT ON OPTION DATE ………………………………………            BX88
 − INCOME OPTION …………………………………………………………………….                  BX89
 − PREMIUMS ……………………………………………………………………………                     BX89
 − INCEPTION DATE ……………………………………………………………………                  BX89
 − AGE AT ENTRY ……………………………………………………………………...                 BX89
 − LIVES INSURED ……………………………………………………………………..                 BX89
 − DEATH BENEFIT …………………………………………………………………….                  BX89
 − FULL CASH WITHDRAWAL ………………………………………………………..               BX89
 − PARTIAL CASH WITHDRAWAL ……………………………………………………               BX90
 − LOANS …………………………………………………………………………………                      BX90
 − CONTINUATIONS ……………………………………………………………………                   BX91
 − SWITCHING …………………………………………………………………………..                   BX91
 − TAX STATUSES ………………………………………………………………………                   BX91

 STRATUS TRADED POLICIES …………………………...……………….…                BX92
 − DESCRIPTION …………………………………………………………………..……                  BX92
 − ADVANTAGES FOR THE INVESTOR …………………………………………….             BX92
 − INITIAL TERM ………………………………………………………………………..                 BX92
 − AVAILABLE INVESTMENT FUNDS ……………………………………………….             BX92
 − SWITCHING BETWEEN INVESTMENT FUNDS …………………………………           BX92
 − INVESTMENT GUARANTEES ……………………………………………………..               BX92
 − THE INVESTMENT GUARANTEE DATE …………………………………………             BX92
 − PREMIUMS …………………………………………………………………………..                    BX92
 − INCEPTION DATE (TRANSFER DATE) …………………………………………..          BX92
 − AGE AT ENTRY ………………………………………………………………………                   BX93
 − DEATH BENEFIT …………………………………………………………………….                  BX93
 − REGULAR CASH WITHDRAWAL AMOUNTS …………………………………...           BX93
 − LOANS …………………………………………………………………………………                      BX93
 − LIFE INSUREDS ……………………………………………………………………...                BX94
 − CESSIONS AND APPOINTING BENEFICIARIES / NOMINEES ……………….   BX94
 − TAX IMPLICATIONS …………………………………………………………………                 BX94


                                                              12/…




GE 2/2006                          BX
                                  - 12 -
                                                            Page


 B. STRATUS PREMIER RANGE OF PRODUCTS
 MINIMUM PREMIUMS ………………………..…………...……………….…                BX95

 AVAILABLE INVESTMENT FUNDS …………………………………………                BX95

 C. FEATURES OF STRATUS
 1. INVESTMENT FUNDS …………….………..………...……………….…              BX96

 1.1 FUNDS AVAILABLE FOR STRATUS AND STRATUS PREMIER …      BX96
 − ABSOLUTE RETURN FUND (CPIX + 3%) …………………….………………….       BX96
 − MULTI-MANAGER ABSOLUTE RETURN FUND (CPIX + 3%) …………………   BX96
 − PPS MULTI-MANAGER INFLATION + 3% ………………………………………..       BX97
 − ABSOLUTE RETURN FUND (CPIX + 5%) ………………………………………..       BX97
 − MULTI-MANAGER ABSOLUTE RETURN FUND (CPIX + 5%) …………………   BX98
 − PPS MULTI-MANAGER INFLATION + 5% ………………………………………..       BX98
 − VESTING BONUS FUND ……………………………………………………………               BX99
 − SIM MANAGED CAUTIOUS SOLUTION …………………………………………..         BX99
 − BALANCED FUND (LOW EQUITY) ………………………………………………..          BX100
 − MULTI-MANAGER BALANCED FUND (LOW EQUITY) …………………….…..    BX100
 − SIM MANAGED MODERATE SOLUTION …………………………………………           BX101
 − BALANCED FUND (MEDIUM EQUITY) ……………………………………….…..        BX101
 − MULTI-MANAGER BALANCED FUND (MEDIUM EQUITY) ……………………     BX102
 − PPS MULTI-MANAGER INFLATION + 8% ………………………………………..       BX102
 − BALANCED FUND (HIGH EQUITY) ……………………………………………….          BX103
 − MULTI MANAGER BALANCED FUND (HIGH EQUITY) ………………………..    BX103
 − SIM MANAGED AGGRESSIVE SOLUTION ………………………………………          BX104
 − GUARANTEED CAPITAL FUND …………………………………………………..            BX104
 − PPS ENHANCED CASH FUND ……………………………………………………              BX104
 − BOND FUND ………………………………………………………………………….                  BX105
 − PROPERTY FUND …………………………………………………………………..                BX105
 − SANLAM EQUITY FUND ……………………………………………………………               BX106
 − MULTI-MANAGER EQUITY FUND …………………………………………………            BX106
 − OFFSHORE / INTERNATIONAL HEDGE FUND …………………………………        BX107
 − OFFSHORE / INTERNATIONAL BALANCED FUND ……………………………       BX107
 − OFFSHORE / INTERNATIONAL MONEY MARKET FUND US$ ……………….   BX107
 − OFFSHORE / INTERNATIONAL MONEY MARKET FUND £ …………………..   BX108
 − OFFSHORE / INTERNATIONAL MONEY MARKET FUND €……………………     BX108
 − OFFSHORE / INTERNATIONAL BOND FUND …………………………………..       BX108
 − OFFSHORE / INTERNATIONAL PROPERTY FUND ……………………………       BX109
 − OFFSHORE / INTERNATIONAL EQUITY FUND ………………………………..      BX109

                                                            13/…




GE 8/2008                         BX
                                  - 13 -
                                                            Page


 1.2 FUNDS AVAILABLE FOR STRATUS PREMIER ONLY ………….….       BX110
 − CORONATION STRATEGIC INCOME FUND ………………….…………………         BX110
 − INVESTEC ABSOLUTE INCOME FUND ………………………………………….          BX110
 − SANLAM INCOME FUND ……………………………………………………………               BX110
 − CORONATION PROPERTY EQUITY FUND ……………………………………..         BX111
 − ALLAN GRAY STABLE FUND ……………………………………………………..            BX111
 − ALLAN GRAY BALANCED FUND ………………………………………………….            BX111
 − NEDBANK MANAGED FUND ………………………………………………………               BX112
 − INVESTEC MANAGED FUND ………………………………………………………              BX112
 − SANLAM BALANCED FUND ………………………………………………………..             BX112
 − SANLAM MULTI MANAGED BALANCED FUND OF FUNDS …………………..    BX113
 − FRATERS FLEXIBLE FUND ………………………………………………………..            BX113
 − CORONATION ABSOLUTE FUND …………………………………………………             BX113
 − ALLAN GRAY OPTIMAL FUND …………………………………………………….            BX114
 − PSG BALANCED FUND …………………………………………………………….               BX114
 − SANLAM DEFENSIVE FUND OF FUNDS ………………………………………..         BX114
 − SANLAM INFLATION LINKED FUND ……………………………………………..         BX114
 − ALLAN GRAY EQUITY FUND ………………………………………………………             BX115
 − INVESTEC EQUITY FUND ………………………………………………………….             BX115
 − INVESTEC CAUTIOUS MANAGED FUND ………………………………………..         BX115
 − CORONATION EQUITY FUND ……………………………………………………..            BX116
 − CORONATION OPTIMUM GROWTH FUND ……………………………………..          BX116
 − NEDBANK RAINMAKER FUND …………………………………………………….             BX116
 − OASIS CRESCENT EQUITY FUND ……………………………………………….           BX117
 − PSG ALPHEN EQUITY FUND OF FUNDS ……………………………………….         BX117
 − SANLAM GENERAL EQUITY FUND ……………………………………………….           BX117
 − SANLAM MULTI MANAGED EQUITY FUND OF FUNDS ……………………….     BX118
 − SANLAM VALUE FUND ……………………………………………………………..              BX118
 − SANLAM SMALL CAP FUND ……………………………………………………….             BX118
 − SANLAM FINANCIAL FUND ………………………………………………………..            BX119
 − SANLAM INDUSTRIAL FUND ………………………………………………………             BX119
 − SANLAM INTERNATIONAL DEFENSIVE FUND OF FUNDS …………………..   BX119
 − SANLAM ABSA POSITIVE RETURN FUND ………………..….…………………       BX120
 − ABSA BALANCED FUND …………………………………………………………...             BX120
 − ABSA SELECT EQUITY FUND …………………………………………………….            BX120
 − SANLAM GLOBAL BEST IDEAS FUND …………………………………………..         BX121
 − OLD MUTUAL DYNAMIC FLOOR FUND ………………………………………….          BX121
 − OLD MUTUAL ENHANCED INCOME FUND ……………………………………..         BX122
 − FOORD EQUITY FUND ……………………………………………………………..              BX122
 − KRUGER PRUDENTIAL FUND OF FUNDS ………………………………………          BX122
 − KRUGER FLEXIBLE FUND OF FUNDS …………………………………………..         BX123

                                                            14/…


GE 8/2008                         BX
                                     - 14 -
                                                                  Page


 2. AVAILABILITY OF PRICES ……………………………………….………                    BX124

 3. SWITCHING AND REDIRECTIONS ……………………………….….…                   BX124

 4. INVESTMENT GUARANTEES …………………………………….……..                     BX124

 5. ENDOWMENT OPTION FOR RETIREMENT ANNUITIES AND
                                                                  BX125
    PRESERVATION FUNDS ……………………………………..………….

 6. STRATUS LIFETIME INVESTMENT OPTION …………………………..               BX126

 D. STRATUS RIDER BENEFITS
 WAIVER OF PREMIUM AT DISABILITY (OPG, OGG) ……………………              BX129
 WAIVER OF PREMIUM AT DEATH (DP, DG) ……………………………...               BX133

 E. SUMMARIES
 1. AVAILABLE INVESTMENT FUNDS PER PRODUCT ………….….…..             BX135
 − ORDINARY INSURANCE (non-retirement business) ………………………….....   BX135
 − RETIREMENT BUSINESS ……………………………….………………………....                 BX138

 2. MINIMUM PREMIUMS AND TABLE CODES …………………..….……                BX144
 F. ADDITIONAL INFORMATION ABOUT RETIREMENT
    ANNUITIES
 − REASONS WHY RA FUNDS ORIGINATED …………………………….                   BX145
 − LEGAL REQUIREMENTS FOR RA FUNDS …………………………….                   BX145
 − FUNDS UNDERWRITTEN BY SANLAM LIFE ………………………….                  BX146
 − GENERAL INFORMATION : RETIREMENT ANNUITY FUNDS ……...           BX146
 − INCOME TAX ………………………………………………………………..                          BX146
 − ESTATE DUTY ………………………………………………………………                           BX152




GE 8/2008                             BX
A.        STRATUS RANGE OF PRODUCTS

    STRATUS ENDOWMENT

DESCRIPTION

Stratus Endowment is an investment where clients can take out a no-risk policy (without life cover) in
one or more of the available investment funds (a maximum of 10 funds may be chosen). A Stratus
endowment must always have at least one life insured.

With Stratus, Sanlam Life wants to offer clients transparent, good value for money products. After
certain fees have been subtracted, Sanlam Life purchases units for the client with his net investment.

The client may choose more than one investment fund per policy, and can switch between available
funds at any time.

INITIAL TERM

•    The client chooses, for new policies and conversions, an initial term, between the minimum and the
     maximum terms applicable, when he or she takes out the policy.
•    For new policies the minimum and maximum terms are as follows:

        Minimum : 5 years
        Maximum : 30 years

•    For conversions the minimum term is one year. If an investment guarantee is selected, the minimum
     term is, however, five years. The client can inter alia select an option date equal to the maturity date
     of the policy that is being converted. The initial term of the converted policy must, however, be in full
     years. If the outstanding term of the existing policy is for example 8 years and 5 months, the initial
     term of the converted policy will therefore be nine years if the client selects the term equal to the
     outstanding term of his or her existing policy. If the outstanding term of the policy that is being
     converted is less than 5 years, the end date of the converted Stratus policy may not precede the
     maturity date of the policy that is being converted.
•    After the initial term has expired, the term is open-ended. This means that the policy will not
     automatically be paid out after the initial term has expired, but that the policy will continue until the
     policyholder claims the proceeds or until the death of the life insured.
•    Although a maximum term of 30 years can be chosen, special permission must be obtained for
     terms that exceed 15 years. Reasons must therefore be given for terms longer than 15 years. If a
     term longer than 15 years is granted, the commission term is limited to 15 years.

THE OPTION DATE

The client chooses an initial term when he or she takes out the policy or on the conversion date (with
conversions). The date at the end of the initial term is the option date.

The policy will automatically continue after the initial term has expired if the policyholder does not notify
Sanlam Life that he or she wants to take the proceeds. The policy can continue with or without future
premium payments.




GE 8/2006                                            BX 1
AMOUNT ON OPTION DATE

On the option date, the amount to which the policy investment has grown, is available.                 If the
policyholder takes the available amount, the policy will be terminated.

If the policyholder chose the investment guarantee in the case of an investment fund where such a
guarantee is available, a minimum rate of investment return will be guaranteed on the value of the policy
investment in each investment fund for which an investment guarantee was chosen.

If the policyholder does not take the value of the policy investment on the option date, the policy is not
terminated. It is continued for further capital growth. If the policyholder wants to continue with the
investment, but he or she wants to cease the payment of premiums after the option date, he or she must
at that stage inform us accordingly.

If the policyholder indeed wants to take the value of the policy investment on the option date, he or she
must provide us with a completed claim form at least two days before the option date.

AVAILABLE INVESTMENT FUNDS

See section E(1).

SWITCHING BETWEEN INVESTMENT FUNDS

See section C(3).

INVESTMENT GUARANTEES

See section C(4).

THE INVESTMENT GUARANTEE DATE

•   If an investment guarantee is chosen, the policy has at least one investment guarantee date.
•   The first investment guarantee date is determined as follows:
    −   If the option date is later than 15 years after inception date, the first investment guarantee date is
        10 years after inception date. Further investment guarantee dates depend on the remaining initial
        term. See section C (4) for a further explanation of these dates.
    −   If the option date is 15 years or less after the inception date, there is only one investment
        guarantee date and is it the same as the option date.

PREMIUMS

The client can choose to make one of the following contributions:

•   Single premium
•   Recurring premiums
    −   not available for certain conversions
    −   must be chosen when the policy is taken out – it cannot be added later
•   A combination of a single premium and recurring premiums

Recurring premiums can only be payable either monthly or annually.

Recurring premiums can be paid by debit order or stop order (electronic premium schedule). No debit
order discount applies. If premiums for new business are not paid by debit order, a collection premium
of 3.5% of the premium, excluding the collection premium, will be charged. Debit orders are permitted
for any day of the month up to and including the 28th.




GE 8/2006                                           BX 2
PREMIUMS (continued)

The minimum premium is as follows:

                                                                 Recurring premium per
                                                  Ad hoc                 month2
                                                                                                Recurring
                                     Single       addition                                      premium
                                    premium        (single      Initial term     Initial term           1
                                                                10 years or     less than 10    increase
                                                 premium)1
                                                                   more             years
    Non-conversions:
       Single premium only:         R10 000        R2 500           N/a              N/a            N/a

       Single premium plus
         recurring premiums:         R2 500        R2 500          R150             R300            R70

       Recurring premium only:         N/a         R2 500          R150             R300            R70

       If part of Stratus and
       Matrix combination
       product:                        N/a           N/a           R100             R225            N/a
                                             3
    Conversions                      R2 500        R2 500          R150             R150            R70

1
  Subject to the restrictions in terms of Section 54 of the Long-term Insurance Act.
2
  The minimum amount that may be invested per investment fund is R50,00.
3
  This relates to the transfer amount from the old (converted) policy.

INCEPTION DATE

The inception date in the case of new business is determined by the type of contribution that is made
and is determined as follows:

Recurring premium

•     The inception date can be any day of the month, subject to the payment method. The day on which
      the first premium is payable, is the inception date of the policy.
•     If the mode of payment is per debit order, the inception date can be any day up to and including the
      28th of the month.
•     If the mode of payment is per stop order, the inception date will always be the first of a month and it
      must be a stop order with electronic premium schedule.

Single premium

The inception date is the date on which the single premium is deposited at any contracted-in bank
branch (currently ABSA or First National Bank). It can be any day up to and including the 31st of the
month.

Combination of single premium and recurring premium

•     This combination may be chosen only when the policy is taken out.
•     The recurring premium will, in accordance with the rules stated under ”Recurring premium” above,
      determine the inception date.

In the case of conversions the conversion date is the date on which the conversion becomes
effective. This date is always on the first of a month, except in the case of conversions of Stratus
policies that were issued on the old administration system. The inception date of these policies can be
any day of the month.

NB:
Intermediaries must deposit clients’ cheques as soon as possible (where applicable), since that
date determines the inception date of and price at which units are purchased. If there are
significant market fluctuations between the day on which the client hands the cheque over to the
intermediary and the day on which it is deposited, this can lead to claims against the
intermediary and Sanlam Life. Intermediaries will be held accountable personally for such
claims.
GE 8/2006                                            BX 3
AGE AT ENTRY

The minimum and maximum entry ages are as follows:
    •   Minimum : 1 anb
    •   Maximum : 90 anb

PREMIUM GROWTH

Premium growth on these policies is optional. The client can choose a fixed rate, or can choose that
premiums increase at the consumer price index (CPI).

•   Fixed growth rate

    Any percentage premium growth between 5% (minimum) and 20% (maximum) can be chosen.

•   Consumer price index (CPI)

    When the increase is determined on the basis of the inflation rate, the change in the consumer price
    index, or any other commonly accepted method of measuring inflation that may apply at the time, will
    be taken into account. The minimum increase every year will be 5%. This minimum can be
    changed from time to time.

    An illustrative rate of 5% is used to illustrate premiums and values when premium growth is chosen
    at CPI.

A maximum of two premium increases may be skipped, after which premium growth will lapse.

RIDER BENEFITS

The following rider benefits are available optionally:
•   waiver of premium with future growth at disability
•   waiver of premium without future growth at disability

The benefit is available for new business and conversions.

LIFE COVER AND DISABILITY BENEFITS

No life cover or disability benefits are available. For conversions, if the policy that is converted made
provision for life cover and/or disability benefits, this cover and/or benefits will no longer apply after the
conversion.

DEATH BENEFIT

At the death of the life insured, the value of the policy investment as at the date on which Sanlam Life
received notification of the death, is payable. If the policyholder chose the investment guarantee in the
case of an investment fund where such a guarantee is available, a minimum rate of return is guaranteed
on the investment in each investment fund for which an investment guarantee was chosen.

If there is more than one life insured, the value of the policy investment will only become payable at the
death of the last surviving life insured.




GE 8/2006                                           BX 4
FULL OR PARTIAL CASH WITHDRAWAL

•   The normal policy restrictions in terms of a regulation of the Long-term Insurance Act (Section 54)
    are applicable for cash withdrawal(s) on these policies.
•   One full, or partial, cash withdrawal may be done, whilst benefits are restricted.
•   An alteration fee is charged if a full or partial cash withdrawal is made before the option date. No
    alteration fee is charged after the option date.
•   A cash withdrawal can be made at any time.
•   On policies with more than one underlying investment fund the client has two options:
    −   Cash withdrawal from one specific fund as a percentage of that fund (must be requested as a
        percentage of the value of the policy investment), or
    −   Cash withdrawal from all underlying investment funds - the client chooses an amount, which will
        be withdrawn proportional from each fund, or a percentage.

NB:     Cash withdrawal values shortly after the inception date can be affected negatively by the
        initial costs on the policy.

LOANS

•   Loans are available two months after the inception date.
•   An alteration fee is charged.
•   A number of units (in the underlying investment fund(s)) to the value of the loan amount granted, will
    be switched to units in the Stratus Policyholder Loan Fund. The latter fund does not participate in
    any growth. Settling the loan will result in a switch of units in the Stratus Policyholder Loan Fund to
    units in the policy's investment fund(s) - at the then prevailing selling price of the relevant investment
    fund(s). If the price of the units in the policy's investment fund(s) at that stage is higher than it was
    when the loan was entered into, it means that fewer units will be switched to the policy's investment
    fund(s) than which was originally switched out. The repayment amount may not exceed the loan
    amount (without alteration fee). If the full loan is repaid in one installment, the value of the units on
    the repayment date will be equal to the value of the units that were cancelled when the loan was
    entered into (alteration fee excluded). The investment return that the policyholder does not get
    during the loan period, can be regarded as “interest paid” over the loan period.
•   The minimum loan amount is R2 000. The remaining value of the policy investment must be at least
    R2 500 after the loan has been granted.
•   Repayments can be made at any time.
•   Conditions pertaining to the loan will be determined when the loan is entered into. The normal policy
    restrictions in terms of a regulation of the Long-term Insurance Act (Section 54) apply for loans in the
    case of these policies, i.e. one loan and one withdrawal, subject to a maximum of premiums plus 5%
    compound interest, are allowed during a restriction period.

MAKING PAID-UP

The policy can be made paid-up (VOP) at any stage, subject to a minimum remaining fund value (at
present R1 150)

ALTERATIONS

The following alterations may be done:

•   Ad hoc single premium additions, subject to the conditions under Section 54 of the Long-term
    Insurance Act.
•   Recurring premium increases (only on policies issued with recurring premiums from inception)
    subject to the conditions under Section 54 of the Long-term Insurance Act and the minimum
    premium increase required by Sanlam Life at the time.
•   Premium reductions, provided that the premium after decrease is not below the minimum premium
    required for new business at the date of alteration.
•   Once a recurring premium policy has been made paid-up, a recurring premium cannot be added to
    the policy again.




GE 8/2006                                           BX 5
BENEFICIARY TO RECEIVE DEATH BENEFITS

The policyholder can appoint any person or institution as beneficiary to receive the death benefit at the
death of the life insured. Up to 10 beneficiaries may be appointed in total. The beneficiary(ies) may be
revoked or changed at any time, as long as it is in writing.

POLICY-OWNERSHIP

Only one policyholder is allowed per policy.

CESSIONS

The policyholder may do a collateral or outright session.

TAX

No tax is payable on the proceeds of the policy. Sanlam already pays tax in the chosen investment
fund(s).




GE 8/2006                                         BX 6
    STRATUS INTERNATIONAL ENDOWMENT

DESCRIPTION

Stratus International Endowment is an endowment policy of which the proceeds are paid out in the
currency of the investor’s choice. This investment is made in terms of the concession by the SA
Reserve Bank to individual South African permanent residents to invest a total of R750 000 overseas.
This concession is normally used for investment purposes and can include the payment of premiums on
a policy. To meet the requirements to offer an investment of which the proceeds may be paid in a
foreign currency, Sanlam Life has established a branch on the Isle of Jersey. This branch trades as
Sanlam Jersey.

INVESTMENT PROCESS

•    The client invests a single premium, recurring premiums or a combination of a single and recurring
     premiums.
•    These investments are made in rand. According to the choice of the investor the rand amount is
     switched to American (US) dollars, pound sterling or euro to pay the premiums of the policy.
•    Units are purchased in the relevant currency of the chosen investment fund(s).
•    The assets of the underlying investment fund(s) are 100% internationally based.
•    The proceeds of the policy are paid out in Jersey in the foreign currency/currencies of the chosen
     investment fund(s), or in the foreign currency of the investor’s choice.
•    All feedback to the investor takes place in rand value.

INITIAL TERM

•    The client chooses an initial term, between the minimum and the maximum terms applicable, when
     he or she takes out the policy.
•    The minimum and maximum terms are as follows:
        Minimum : 5 years
        Maximum : 10 years
•    After the initial term has expired, the term is open-ended. This means that the policy will not
     automatically be paid out after the initial term has expired, but that the policy will continue until the
     policyholder claims the proceeds, or until the death of the life insured.
•    The value of the policy investment is available at any stage after the initial term has expired,
     currently without deduction of an alteration fee.

THE OPTION DATE

The client chooses an initial term when he or she takes out the policy. The date at the end of the initial
term is the option date.

The policy will automatically continue after the initial term has expired if the policyholder does not notify
Sanlam Life that he or she wants to take the proceeds. The policy can continue with or without further
premium payments.

AMOUNT ON OPTION DATE

On the option date, the amount to which the policy investment has grown, is available. If the policyholder
takes the available amount, the policy will be terminated.

If the policyholder does not take the value of the policy investment on the option date, the policy is not
terminated. It is continued for further capital growth. If the policyholder wants to continue with the
investment, but he or she wants to cease the payment of premiums after the option date, he or she must
at that stage inform us accordingly.

If the policyholder indeed wants to take the value of the policy investment on the option date, he or she
must provide us with a completed claim form at least two days before the option date.




GE 8/2006                                            BX 7
CONDITIONS TO QUALIFY FOR THE PRODUCT

See Section AA for conditions to which the clients must comply to qualify for Stratus International
Endowment policy.

AVAILABLE INVESTMENT FUNDS

See section E(1).

SWITCHING BETWEEN INVESTMENT FUNDS

See section C(3).

INVESTMENT GUARANTEES

Not available.

PREMIUMS

The client can choose to make one of the following contributions:

•   Single premium
•   Recurring premiums
    −     must be chosen when the policy is taken out – it cannot be added later
    −     A combination of a single premium and recurring premiums

The first premium of a recurring premium policy may not be paid in cash.

Recurring premiums can only be payable either monthly or annually.

Recurring premiums can only be paid by debit order. No debit order discount applies. Debit orders are
permitted for any day of the month up to and including the 28th.

The minimum premium is as follows:

                                                              Ad hoc
                                                              addition      Recurring        Recurring
                                            Single
                                                               (single     premium per       premium
                                           premium
                                                             premium)
                                                                       1      month2         increase1


    Single premium only:                   R10 000            R2 500           N/a              N/a

    Single premium plus recurring
      premiums:                             R2 500            R2 500           R750            R70

    Recurring premium only:                   N/a             R2 500           R750            R70

    1
        Subject to the restrictions in terms of Section 54 of the Long-term Insurance Act.
    2
        The minimum amount that may be invested per investment fund is R50,00.

Other aspects:

•   The client pays an amount to Sanlam Life in Rand. The Rand amount remains constant and is not
    affected by the exchange rate. The amount of US dollars, pound sterling or euro for which it is
    exchanged will vary according to the exchange rate.
•   If the policyholder and the premium payer differ, the form “International Policy : Premium payer is
    someone other than the proposer” must be completed. The form is available on the Brokers and
    Advisers Web as well as on Notes.
•   If the twelve-monthly tax clearance certificate is at any stage refused, the collection of recurring
    premiums ceases. The amount of the premiums paid up to that stage, will determine whether the
    policy can be made paid-up or whether it will lapse. Also refer to “Choices if tax clearance certificate
    is not longer granted” below.
•   No back-dating is allowed.

GE 8/2006                                             BX 8
INCEPTION DATE

The inception date is determined by the type of contribution that is made and is as follows:

Recurring premium

The inception date can be any day up to and including the 28th of the month. The day on which the first
premium is payable, is the inception date of the policy.

Single premium

The inception date is the day on which the single premium is deposited in the Sanlam Jersey bank
account, after being converted to the relevant foreign currency. It can be any day up to and including
      st
the 31 of the month.

Combination of single premium and recurring premium

•   This combination may be chosen only when the policy is taken out.
•   The recurring premium will, in accordance with the rules stated under “Recurring premium” above,
    determine the inception date.

AGE AT ENTRY

The minimum and maximum entry ages are as follows:

    •   Minimum : 19 anb
    •   Maximum : 90 anb

NB:     The minimum and maximum entry ages apply to both the policyholder and the life
        insured.

PREMIUM GROWTH

Premium growth on these policies is optional. The client can choose a fixed rate, or can choose that
premiums increase at the consumer price index (CPI).

•   Fixed growth rate

    Any percentage premium growth between 5% (minimum) and 20% (maximum) can be chosen.

•   Consumer price index (CPI)

    When the increase is determined on the basis of the inflation rate, the change in the consumer price
    index, or any other commonly accepted method of measuring inflation that may apply at the time, will
    be taken into account. The minimum increase every year will be 5%. This minimum can be
    changed from time to time.

    An illustrative rate of 5% is used to illustrate premiums and values when premium growth is chosen
    at CPI.

A maximum of two premium increases may be skipped, after which premium growth will lapse.

RIDER BENEFITS

No rider benefits are available.

LIFE COVER AND DISABILITY BENEFITS

No life cover or disability benefits are available.




GE 8/2006                                             BX 9
DEATH BENEFIT

At the death of the life insured, the value of the policy investment as at the date on which Sanlam Life
received notification of the death, is payable.

FULL OR PARTIAL CASH WITHDRAWAL

•   The normal policy restrictions in terms of a regulation of the Long-term Insurance Act (Section 54)
    are applicable for cash withdrawal(s) on these policies. This requirement as confirmed with the
    Financial Services Board is because the policy is marketed here in South Africa to policyholders in
    South Africa. This despite the fact that the policy premium and benefits are being paid offshore and
    that Sanlam Life also complies with the Jersey assurance legislation.
•   An alteration fee will be recovered in the case of a full cash withdrawal during the initial term.
•   One full, or partial, cash withdrawal may be done, whilst benefits are restricted.
•   An alteration fee is charged if a full or partial cash withdrawal is made before the option date. No
    alteration fee is charged after the option date.
•   A cash withdrawal can be made at any time.
•   On policies with more than one underlying investment fund the client has two options:
    −   Cash withdrawal from one specific fund as a percentage of that fund (must be requested as a
        percentage of the value of the policy investment), or
    −   Cash withdrawal from all underlying investment funds - the client chooses an amount, which will
        be withdrawn proportional from each fund, or a percentage.

NB: Cash withdrawal values shortly after the inception date can be affected negatively by the
    initial costs on the policy.

LOANS

No loans are allowed against these policies.

PAYMENT OF ANY BENEFITS

The benefits can be payable in one of the following events:

    •   on the option date;
    •   at the death of the policyholder; or
    •   if the policyholder wants to make a cash withdrawal (in full or partial) at any stage during the
        duration of the policy.

If the International Money Market Fund (US$), the International Money Market Fund (£)
or the International Money Market Fund (€) was chosen

All benefits will be paid in Jersey in the currency of the chosen investment fund. The policyholder can,
however, request Sanlam Life to pay the benefits in any other currency, into a bank account in the
country of his or her choice. Any currency charges or other bank levies will be deducted from the benefit
amount.

If any other International Fund was chosen

All benefits will be paid in US dollar in Jersey. However, the policyholder can request Sanlam Life to
pay it in any other currency, into a bank account in the country of his or her choice. Any currency
charges or other bank charges will be deducted from the benefit amount.




GE 8/2006                                           BX 10
MAXIMUM ALLOWANCE

An individual South African resident may not invest more than R750 000 in total overseas. In order to
ensure that this happens, all investments taken out of the country in terms of the R750 000 allowance
must be taken into account. This includes international investments such as policies, unit trust
investments, bank accounts, etc. Where international policies is concerned, the following existing and
new policies at Sanlam Life and other insurers must be taken into account:

   •   Single premium investments.
   •   Recurring premiums as an annual amount, multiplied by die policy term. As soon as a policy's
       total premiums during the policy term is more than the maximum permitted allowance at the time
       (R750 000 at present), the policy is made fully paid-up (VOP).
   •   Premium growth on recurring premiums during the policy term.

The above calculation does not include amounts of policies where an offshore investment fund (such as
the Offshore Equity Fund) has been selected.

As soon as a client has used the maximum permitted allowance, single premium additions or premium
payments can not be done on existing International policies

CHOICES IF THE TAX CLEARANCE CERTIFICATE IS NO LONGER GRANTED

Unfortunately, should further contributions to an existing Stratus International Endowment policy
become impossible because the South African Revenue Service (SARS) does not issue a tax clearance
certificate to the client, such a policy will have to be made paid-up (VOP). Clients can keep their offshore
exposure by replacing their International policies with local Stratus policies, with one or more of the
offshore investment portfolios as an investment fund. This is how it works:

If the client is not able to obtain tax clearance in order to invest further funds offshore, Sanlam will send
a letter to the client informing him or her that the policy will be made paid-up (VOP). However, the client
is offered an alternative to retain exposure to offshore investments. He or she is encouraged to
continue the present premium on a new local Stratus policy, with one or more of the offshore portfolios
as an investment option.

In this way he/she can still enjoy the full benefits of rand hedging, together with the diversification that
his or her investment portfolio receives from an offshore investment. The only difference is that the local
policy’s benefits will be paid out in rands.

A Stratus International Endowment can be replaced with a Stratus Endowment. An endowment policy
cannot be replaced with an RA, and vice versa.

The term of the new policy must be the same as the remaining term of the International policy that is
made VOP, subject to the minimum term for a new policy (presently five years).

If the policy is made VOP within the first two years of the term, commission must be clawed back from
the intermediary according to law.

Intermediaries can place themselves and the client in a neutral position by allowing the commission to
be cut on the new policy, so that the commission under the new policy is the same as the commission
that is clawed back on the old policy. At the same time Sanlam Life will cut its marketing costs
proportionately to the client’s benefit.

If the policy is made VOP after two years, no commission is clawed back. The new policy will therefore
have to be issued without commission to place the client in the same position as before the policy was
made VOP.

Special quotations for calculating the cut in commission are available and can be obtained from Product
Support at (021) 916-3082.




GE 8/2006                                          BX 11
CHOICES IF THE TAX CLEARANCE CERTIFICATE IS NO LONGER GRANTED
(continued)

Intermediaries are under no obligation to take commission cut in the case of these policies, provided the
LOA Replacement Code, read with the replacement disclosure requirements in the General Code in
terms of FAIS, are complied with (i.e. the RPAR form - AE2794 - is completed in conjunction with the
client). The objective is for intermediaries to be able to reach a compromise with their clients so that
they do not have to suffer losses as a result of the compulsory VOP, while the intermediaries do not
suffer any losses. A cut in commission can contribute to the sale of the new local Stratus policy.

Apart from the special quotation that has to be obtained, the rest of the process is the same as for any
other new policy. The proposal will therefore be treated like a normal new proposal. The new policy is
regarded as a replacement – the normal replacement requirements therefore apply.

MAKING PAID-UP

The policy can be maid paid-up (VOP) at any stage, subject to a minimum remaining fund value
(currently R2 875).

ALTERATIONS

The following alterations may be done:

•   Ad hoc single premium additions, subject to the conditions under Section 54 of the Long-term
    Insurance Act.
•   Recurring premium increases (only on policies issued with recurring premiums from inception)
    subject to the conditions under Section 54 of the Long-term Insurance Act and the minimum
    premium increase required at the time.
•   Premium reductions, provided that the premium after decrease is not below the minimum premium
    required for new business at the date of alteration.
•   Once a recurring premium policy has been made paid-up, a recurring premium cannot be added to
    the policy again.

BENEFICIARY TO RECEIVE THE DEATH BENEFIT

The policyholder can appoint any person or institution as beneficiary to receive the death benefit at the
death of the life insured. Up to 10 beneficiaries may be appointed in total. The beneficiary(ies) may be
revoked or changed at any time, as long as it is in writing and received by Sanlam Life before the
policyholder's death.

POLICY-OWNERSHIP

Usually, an individual will be the owner of the policy, because entities such as trusts, companies and
tax-exempt institutions must also obtain a tax clearance certificate from the South African Revenue
Services (SARS) and approval from the SA Reserve Bank before they can be the owner of such a
policy. This clearance and approval will probably only be given to them in exceptional circumstances. It
is therefore unlikely that the product will be freely available to entities such as trusts, companies and
institutions. As a result, only natural persons are at present allowed to submit a proposal for a Stratus
International Endowment.




GE 8/2006                                        BX 12
CESSIONS

The following cessions will be permissible, subject to the approval of the SA Reserve Bank:

•   From one individual to another individual.
•   From an individual to a non-natural foreign entity.

The following apply if the cession is to another individual (in the RSA):

When a Stratus International Endowment is ceded outright this means that the policy changes hands.
In such a case, basically the same process must be followed as for new proposals, therefore SARS
clearance and SA Reserve Bank approval for the value of the policy on the cession date. To the cedent
(previous policyholder) this means that the value of the policy at cession may apply as credit for his/her
R750 000 offshore allowance, and that he or she may therefore in future again take an equivalent
amount of the value at cession offshore. To facilitate that his/her record with the SA Reserve Bank
reflects the credit of his/her offshore allowance, the previous policyholder should confirm this with ABSA,
or with his own bank who may confirm this with ABSA.

•   The new owner, if a SA resident, must submit a letter, addressed to the SA Reserve Bank, together
    with the Notice of Cession, to Sanlam Life. Sanlam Life then gives this letter to ABSA, which acts as
    the authorised dealer for the policy. In terms of the exchange control regulations, the new owner
    must submit this letter to ABSA within 30 days of obtaining the rights to the policy benefits. Sanlam
    Life therefore requires this to be submitted together with the Notice of Cession. In this letter the
    cessionary (new owner) must inform the SA Reserve Bank:

    −   that he/she has acquired the policy, and indicate the date on which the policy was acquired, as
        well as the value of the policy at that date;
    −   how the policy was acquired, for example bought, exchanged, as a gift, etc.;
    −   why the policy was acquired (purpose of the policy);
    −   where the policy benefits will be received (overseas or in the RSA);
    −   how the policy will be maintained (mention whether premiums are to be paid); and
    −   whether the policy is going to be retained.

In the letter the new owner must also undertake to obtain the SA Reserve Bank's prior permission if the
policy is to be sold, transferred or otherwise dealt with by the new owner.

All these requirements are set by regulation 7 of the exchange control regulations. Even if the policy
does not have any value on the cession date, the above-mentioned requirements must still be provided
by the new owner.

NB: (Also see the last paragraph about cessions below.) Because the exchange control
    regulations require the letter from the person to whom the policy has been ceded, the latter
    (the cessionary) is responsible for its content, and the most Sanlam Life can do is to give
    guidelines on the content of the letter.

•   If the new owner, in the case of a recurring premium policy, wants to continue premium payments
    under the policy, the new owner - apart from the letter to the SA Reserve Bank mentioned above, as
    well as SARS approval in respect of the policy value when the policy was obtained - must also fill in
    the form of the SA Reserve Bank (form M.P.1423) and submit it together with the cession form and
    the tax clearance certificate for future premiums to be paid. If no premiums will be paid by the new
    owner, this form must not be filled in again.
•   If the new owner is going to pay further premiums in terms of the policy, he or she must authorize
    Sanlam Life to obtain annual tax clearances from SARS on his or her behalf.
•   Sanlam Life requires a declaration from the new owner in which he/she confirms the source of the
    money, as well as that it is his/her own money.
•   In the case of further premium payments, the new owner must furnish Sanlam Life with a valid
    completed debit order form for the deduction of future recurring premiums. The premium-payer and
    new policyholder (i.e. cessionary in the case of an outright cession) need not be the same person.

The contract stipulates that in the case of collateral security cessions the collateral security cessionary
may only receive the benefits in rand in the RSA.




GE 8/2006                                             BX 13
Cessions of Stratus International Endowment Policy policies to persons or institutions offshore are
allowed only if certain guidelines are complied with. These guidelines are as follows:

 Payment of premiums      A Stratus International Endowment Policy on which premiums are still
                          payable can only be ceded to a foreign person (individual, trust or company)
                          if the policy is made paid-up during the cession.
                          The following rules apply to premiums on a Stratus International
                          Endowment Policy:
                          •   The policyholder must be resident in the RSA.
                          •   The policyholder must have obtained permission from the SA Reserve
                              Bank and tax clearance from the South African Revenue Services
                              (SARS) for payment of the premiums, unless he only has a temporary
                              work permit in the RSA in which case a declaration from his RSA bank
                              to ABSA is required.
                          •   The premiums may only be paid via an ABSA account in the RSA, after
                              which they are converted into the foreign currency concerned.
 Cessionary a foreign     If a Stratus International Endowment Policy is ceded to a foreign trust
 trust                    Sanlam Life requires a certified copy of the appointment of the trustees by
                          the foreign authorities where the trust is registered.
 Cessionary a foreign     If the cessionary is an individual in a foreign country, Sanlam Life requires a
 individual               certified copy of the foreign identity document or passport, as well as written
                          proof of the residential address (e.g. a certified copy of a bank statement
                          with the cessionary's address on it).
 Cessionary a foreign     If the policy is ceded to a foreign company, Sanlam Life requires a certified
 company                  copy of the company's registration certificate in the foreign country, as well
                          as a letterhead of the company.
 Cedent's foreign         In case of a cession to a foreign resident the cedent's (previous
 allowance limit not      policyholder) R750 000 foreign allowance is not credited with the value of
 credited                 the policy. A credit of the allowance to the cedent only applies when he
                          cedes the policy to another RSA resident (who is subject to the R750 000
                          foreign allowance limit).

TAX

No tax is payable on the proceeds of the policy. Sanlam already pays tax in the chosen investment
fund.




GE 8/2006                                       BX 14
    STRATUS EDUFOCUS


DESCRIPTION

Stratus EduFocus is an investment where a client can take out a no-risk policy (without life cover) on the
life of a child, e.g. to make financial provision for the child's tertiary education. One or more of the
available investment funds (maximum 10) may be chosen.

The following rider benefits are available optionally:

•   waiver of premium with future growth at disability
•   waiver of premium without future growth at disability
•   waiver of premium with future growth at death
•   waiver of premium without future growth at death

A Stratus EduFocus must always have at least one life insured. It is, however, possible to have more
than one life insured on such a policy. Only one life insured may be linked to the savings benefit, while
a maximum of 2 lives insured can be linked to each of the two types of waiver of premium benefits (at
disability and at death).

With Stratus, Sanlam Life wants to offer clients transparent, good value for money products. After
certain fees have been subtracted, Sanlam Life purchases units for the client with his net investment.

The client may choose more than one investment fund per policy, and can switch between available
funds at any time.

INITIAL TERM

•   The client chooses an initial term, between the minimum and the maximum terms applicable, when
    he or she takes out the policy.
•   The minimum and maximum terms are as follows:
       Minimum : 5 years
       Maximum : 20 years
•   After the initial term has expired, the term is open-ended. This means that the policy will not
    automatically be paid out after the initial term has expired, but that the policy will continue until the
    policyholder claims the proceeds, or until the death of the child.
•   Although a maximum term of 20 years can be chosen, special permission must be obtained for
    terms that exceed 15 years. Reasons must therefore be given for terms longer than 15 years. If a
    term longer than 15 years is granted, the commission term is limited to 15 years.

THE OPTION DATE

The client chooses an initial term when he or she takes out the policy. The date at the end of the initial
term is the option date.

The policy will automatically continue after the initial term has expired if the policyholder does not notify
Sanlam Life that he or she wants to take the proceeds. The policy can continue with or without further
premium payments.

AMOUNT ON OPTION DATE

On the option date, the amount to which the policy investment has grown, is available.                 If the
policyholder takes the available amount, the policy will be terminated.

If the policyholder chose the investment guarantee in the case of an investment fund where such a
guarantee is available, a minimum rate of investment return will be guaranteed on the value of the policy
investment in each investment fund for which an investment guarantee was chosen.

If the policyholder does not take the value of the policy investment on the option date, the policy is not
terminated. It is continued for further capital growth. If the policyholder wants to continue with the
investment, but he or she wants to cease the payment of premiums after the option date, he or she must
at that stage inform us accordingly.

If the policyholder indeed wants to take the value of the policy investment on the option date, he or she
must provide us with a completed claim form at least two days before the option date.

GE 8/2006                                          BX 15
AVAILABLE INVESTMENT FUNDS

See section E(1).

SWITCHING BETWEEN INVESTMENT FUNDS

See section C(3).

INVESTMENT GUARANTEES

See section C(4).

THE INVESTMENT GUARANTEE DATE

•     If an investment guarantee is chosen, the policy has at least one investment guarantee date.
•     The first investment guarantee date is determined as follows:
      −   If the option date is later than 15 years after inception date, the first investment guarantee date is
          10 years after inception date. Further investment guarantee dates depend on the remaining initial
          term. See section C (4) for a further explanation of these dates.
      −   If the option date is 15 years or less after the inception date, there is only one investment
          guarantee date and is it the same as the option date..

PREMIUMS

The client can choose to make one of the following contributions:

•     Single premium
•     Recurring premiums
      −   must be chosen when the policy is taken out – it cannot be added later
      −   a combination of a single and recurring premiums

Recurring premiums can only be payable either monthly or annually.

Recurring premiums can be paid by debit or stop order (electronic premium schedule only). No debit
order discount applies. If premiums for new business are not paid by debit order, a collection premium
of 3.5% of the premium, excluding the collection premium, will be charged. Debit orders are permitted
for any day of the month up to and including the 28th.

The minimum premium is as follows:

                                                                   Recurring premium per
                                                                                 2
                                                   Ad hoc                  month
                                                                                                   Recurring
                                      Single       addition                                        premium
                                     premium                      Initial term     Initial term
                                                    (single                                        increase
                                                                                                           1
                                                            1     10 years or     less than 10
                                                  premium)
                                                                     more             years
    Single premium only:             R10 000        R2 500            N/a              N/a             N/a

    Single premium plus
      recurring premiums:             R2 500        R2 500           R150             R300             R70

    Recurring premium only:             N/a         R2 500           R150             R300             R70

1
    Subject to the restrictions in terms of Section 54 of the Long-term Insurance Act.
2
    The minimum amount that may be invested per investment fund is R50,00.




GE 8/2006                                             BX 16
INCEPTION DATE

The inception date is determined by the type of contribution that is made and is as follows:

Recurring premium

•   The inception date can be any day of the month, subject to the payment method. The day on which
    the first premium is payable, is the inception date of the policy.
•   If the mode of payment is per debit order, the inception date can be any day up to and including the
    28th of the month.
•   If the mode of payment is per stop order, the inception date will always be the first of a month and it
    must be a tape exchange stop order.

Single premium

The inception date is the date on which the single premium is deposited at any contracted-in bank
branch (currently ABSA or First National Bank). It can be any day up to and including the 31st of the
month.

Combination of investment amount (single premium) and recurring premium

•   This combination may be chosen only when the policy is taken out.
•   The recurring premium will, in accordance with the rules stated under “Recurring premium" above,
    determine the inception date.

AGE AT ENTRY

The minimum and maximum entry ages for the child are as follows:

•   Minimum : 1 anb
•   Maximum : 14 anb

The minimum and maximum entry ages for the co-insured are as follows:

•   Minimum : 15 anb
•   Maximum : 90 anb

PREMIUM GROWTH

Premium growth on these policies is optional. The client can choose a fixed rate, or can choose that
premiums increase at the consumer price index (CPI).

•   Fixed growth rate
    Any percentage premium growth between 5% (minimum) and 20% (maximum) may be chosen.

•   Consumer price index (CPI)
    When the increase is determined on the basis of the inflation rate, the change in the consumer price
    index, or any other commonly accepted method of measuring inflation that may apply at the time, will
    be taken into account. The minimum increase every year will be 5%. This minimum can be
    changed from time to time.

    An illustrative rate of 5% is used to illustrate premiums and values when premium growth is chosen
    at CPI.

A maximum of two premium increases may be skipped, after which premium growth will lapse.




GE 8/2006                                         BX 17
RIDER BENEFITS

The following rider benefits are available optionally:

•   waiver of premium with future growth at disability
•   waiver of premium without future growth at disability
•   waiver of premium with future growth at death
•   waiver of premium without future growth at death

LIFE COVER AND DISABILITY BENEFITS

No life cover or disability benefits are available.

DEATH BENEFIT

At the death of the child, the value of the policy investment as at the date on which Sanlam Life received
notification of the death, is payable. If the policyholder chose the investment guarantee in the case of
an investment fund where such a guarantee is available, a minimum rate of return is guaranteed on the
investment in each investment fund for which an investment guarantee was chosen.

FULL OR PARTIAL CASH WITHDRAWALS

•   The normal policy restrictions in terms of a regulation of the Long-term Insurance Act (Section 54)
    are applicable for cash withdrawal(s) on these policies.
•   One full, or partial, cash withdrawal may be done, whilst benefits are restricted.
•   An alteration fee is charged if a full or partial cash withdrawal is made before the option date. No
    alteration fee is charged after the option date.
•   A cash withdrawal can be made at any time.
•   On policies with more than one underlying investment fund the client has two options:
    −   Cash withdrawal from one specific fund as a percentage of that fund (must be requested as a
        percentage of the value of the policy investment), or
    −   Cash withdrawal from all underlying investment funds - the client chooses an amount, which will
        be withdrawn proportional from each fund, or a percentage.

NB: Cash withdrawal values shortly after the inception date can be affected negatively by the
    initial costs on the policy.

LOANS

•   Loans are available two months after the inception date.
•   An alteration fee is charged.
•   A number of units (in the underlying investment fund(s)) to the value of the loan amount granted, will
    be switched to units in the Stratus Policyholder Loan Fund. The latter fund does not participate in
    any growth. Settling the loan will result in a switch of units in the Stratus Policyholder Loan Fund to
    units in the policy's investment fund(s) - at the then prevailing selling price of the relevant investment
    fund(s). If the price of the units in the policy's investment fund(s) at that stage is higher than it was
    when the loan was entered into, it means that fewer units will be switched to the policy's investment
    fund(s) than which was originally switched out. The repayment amount may not exceed the loan
    amount (without alteration fee). If the full loan is repaid in one installment, the value of the units on
    the repayment date will be equal to the value of the units that were cancelled when the loan was
    entered into (alteration fee excluded). The investment return that the policyholder does not get
    during the loan period, can be regarded as “interest paid” over the loan period.
•   The minimum loan amount is R2 000. The remaining value of the policy investment must be at least
    R2 500 after the loan has been granted.
•   Repayments can be made at any time.
•   Conditions pertaining to the loan will be determined when the loan is entered into. The normal policy
    restrictions in terms of a regulation of the Long-term Insurance Act (previously Section 59D) apply
    for loans in the case of these policies, i.e. one loan and one withdrawal, subject to a maximum of
    premiums plus 5% compound interest, are allowed during a restriction period.




GE 8/2006                                             BX 18
MAKING PAID-UP

The policy can be maid paid-up (VOP) at any stage, subject to a minimum remaining fund value
(currently R1 150).

ALTERATIONS

The following alterations may be done:

•   Ad hoc single premium additions, subject to the conditions under Section 54 of the Long-term
    Insurance Act.
•   Recurring premium increases (only on policies issued with recurring premiums from inception)
    subject to the conditions under Section 54 of the Long-term Insurance Act and the minimum
    premium increase required at the time.
•   Premium reductions, provided that the premium after decrease is not below the minimum premium
    required for new business at the date of alteration.
•   Once a recurring premium policy has been made paid-up, a recurring premium cannot be added to
    the policy again.

BENEFICIARY TO RECEIVE DEATH BENEFITS

The policyholder can appoint any person or institution as beneficiary to receive the death benefit at the
death of the life insured. Up to 10 beneficiaries may be appointed in total. The beneficiary(ies) may be
revoked or changed at any time, as long as it is in writing.

POLICY-OWNERSHIP

Only one policyholder is allowed per policy. Only one nominee for ownership may be appointed.

TAX

No tax is payable on the proceeds of the policy. Sanlam already pays tax in the chosen investment
fund.




GE 8/2006                                        BX 19
    STRATUS SINKING FUND

DESCRIPTION

Stratus Sinking Fund is an investment where clients can take out a no-risk policy (without life cover) in
one or more of the available investment funds (a maximum of 10 funds may be chosen). No rider
benefits are available at present on these policies. A Stratus Sinking Fund has no life insured.

With Stratus, Sanlam Life wants to offer clients transparent, good value for money products. After
certain fees have been subtracted, Sanlam Life purchases units for the client with his net investment.

The client may choose more than one investment fund per policy, and can switch between available
funds at any time.

Only single-premiums are permitted.

INITIAL TERM

•   The client chooses, for new policies and conversions, an initial term, between the minimum and the
    maximum terms applicable, when he or she takes out the policy.
•   For new policies the minimum and maximum terms are as follows:
       Minimum : 5 years
       Maximum : 30 years
•   For conversions the minimum term is one year. If an investment guarantee is selected, the minimum
    term is, however, five years. The client can inter alia select an option date equal to the maturity date
    of the policy that is being converted. The initial term of the converted policy must, however, be in full
    years. If the outstanding term of the existing policy is for example 8 years and 5 months, the initial
    term of the converted policy will therefore be nine years if the client selects the term equal to the
    outstanding term of his or her existing policy. If the outstanding term of the policy being converted,
    is less than 5 years, the end date of the converted Stratus policy may not be earlier than the maturity
    date of the policy that is converted.
•   After the initial term has expired, the term is open-ended. This means that the policy will not
    automatically be paid out after the initial term has expired, but that the policy will continue until the
    policyholder claims the proceeds.

THE OPTION DATE

The client chooses an initial term when he or she takes out the policy (non-continuations) or on the
conversion date (with conversions). The date at the end of the initial term is the option date.

The policy will automatically continue after the initial term has expired if the policyholder does not notify
Sanlam Life that he or she wants to take the proceeds. If the policy was taken out when recurring
premiums were still permitted and at that stage the policyholder still paid recurring premiums, the policy
can continue with or without future premium payments. Otherwise the policy continues without premium
payments.

AMOUNT ON OPTION DATE

On the option date, the amount to which the policy investment has grown, is available. If the policyholder
takes the available amount, the policy will be terminated.

If the policyholder chose the investment guarantee in the case of an investment fund where such a
guarantee is available, a minimum rate of investment return will be guaranteed on the value of the policy
investment in each investment fund for which an investment guarantee was chosen.

If the policyholder does not take the value of the policy investment on the option date, the policy is not
terminated. It is continued for further capital growth. If the policyholder wants to continue with the
investment, but he or she wants to cease the payment of premiums after the option date (if at that stage
recurring premiums are being paid), he or she must at that stage inform us accordingly.

If the policyholder indeed wants to take the value of the policy investment on the option date, he or she
must provide us with a completed claim form at least two days before the option date.



GE 8/2006                                          BX 20
AVAILABLE INVESTMENT FUNDS

See section E(1).

SWITCHING BETWEEN INVESTMENT FUNDS

See section C(3).

INVESTMENT GUARANTEES

See section C(4).

THE INVESTMENT GUARANTEE DATE

•   If an investment guarantee is chosen, the policy has at least one investment guarantee date.
•   The first investment guarantee date is determined as follows:
    −   If the option date is later than 15 years after inception date, the first investment guarantee date is
        10 years after inception date. Further investment guarantee dates depend on the remaining initial
        term. See section C (4) for a further explanation of these dates.
    −   If the option date is 15 years or less after the inception date, there is only one investment
        guarantee date and is it the same as the option date.

PREMIUMS

Only single premiums are permitted.

Recurring premiums are not permitted.

The minimum single premium (after deduction of the initial advisory fee - if any) is as follows:

    •   Non-conversions: R10 000
    •   Conversions and ad hoc additions: R2 500

INCEPTION DATE

The inception date in the case of new business is the date on which the single premium is deposited
at any contracted-in bank branch (currently ABSA or First National Bank). It can be any day up to and
                st
including the 31 of the month.

In the case of conversions the conversion date is the date on which the conversion becomes
effective. This date is always on the first of a month.

AGE AT ENTRY

Age does not play any role with Stratus Sinking Funds because there is no life insured applicable.

RIDER BENEFITS

No rider benefits are available with these products at present.

LIFE COVER AND DISABILITY BENEFITS

No life cover or disability benefits are available with Stratus Sinking Fund.

DEATH BENEFIT

No death benefit is payable at the death of the policyholder (no life insured is involved). The policy is
continued until it is surrendered. If the policyholder appointed a nominee for policy-ownership, that
nominee will become the new policyholder after the death of the policyholder, if he/she accepts the
nomination at that stage. If there is no such nominee at the death of the policyholder, the policy will be
an asset in the policyholder’s estate.




GE 8/2006                                           BX 21
FULL OR PARTIAL CASH WITHDRAWAL

•   The normal policy restrictions in terms of a regulation of the Long-term Insurance Act (Section 54)
    are applicable for cash withdrawal(s) on these policies.
•   One full, or partial, cash withdrawal may be done, whilst benefits are restricted.
•   An alteration fee is charged if a full or partial cash withdrawal is made before the option date. No
    alteration fee is charged after the option date.
•   A cash withdrawal can be made at any time.
•   On policies with more than one underlying investment fund the client has two options:
    −   Cash withdrawal from one specific fund as a percentage of that fund (must be requested as a
        percentage of the value of the policy investment), or
    −   Cash withdrawal from all underlying investment funds - the client chooses an amount, which will
        be withdrawn proportional from each fund, or a percentage.

NB: Cash withdrawal values shortly after the inception date can be affected negatively by the
    initial costs on the policy.

LOANS

•   Loans are available two months after the inception date or conversion date (for new policies and
    conversions respectively).
•   An alteration fee is charged.
•   A number of units (in the underlying investment fund(s)) to the value of the loan amount granted, will
    be switched to units in the Stratus Policyholder Loan Fund. The latter fund does not participate in
    any growth. Settling the loan would result in a switch of units in the Stratus Policyholder Loan Fund
    to units in the policy's investment fund(s) - at the then prevailing selling price of the relevant
    investment fund(s). If the price of the units in the policy's investment fund(s) at that stage is higher
    than it was when the loan was entered into, it means that fewer units will be switched to the policy's
    investment fund(s). The repayment amount may not exceed the loan amount (without the alteration
    fee). If the full loan is repaid in one installment, the value of the units on the repayment date will be
    equal to the value of the units that were cancelled when the loan was entered into (alteration fee
    excluded). The investment return that the policyholder does not get during the loan period, can be
    regarded as “interest paid” over the loan period.
•   The minimum loan amount is R2 000. The remaining value of the policy investment must be at least
    R2 500 after the loan has been granted.
•   Repayments can be made at any time.
•   Conditions pertaining to the loan will be determined when the loan is entered into. The normal policy
    restrictions in terms of a regulation of the Long-term Insurance Act (Section 54) apply for loans in the
    case of these policies, i.e. one loan and one withdrawal, subject to a maximum of premiums plus 5%
    compound interest, are allowed during a restriction period.

ALTERATIONS

The following alterations may be done:
•   Addition of an ad hoc lump sum (minimum of R2 500).
•   Increase/decrease of recurring amounts on policies which were taken out before 30 September 2002
    and where recurring premiums therefore were still available. The minimum increase is R70,00 per
    month. The premium or contribution after a decrease must meet the minimum new business
    requirement, and must therefore be at least R150,00 a month at present.

BENEFICIARY TO RECEIVE DEATH BENEFITS

No beneficiaries may be appointed as there is no life insured.




GE 8/2006                                          BX 22
POLICY-OWNERSHIP

Only one policyholder is allowed per policy.

CESSIONS

The policyholder may do a collateral or outright session.

TAX

No tax is payable on the proceeds of the policy. Sanlam already pays tax in the chosen investment
fund.




GE 8/2006                                         BX 23
    STRATUS CONTINUATIONS WITH OR WITHOUT LIFE INSURED

DESCRIPTION

A Stratus Continuation is an investment where clients can continue the maturity value or the value of the
policy investment of their non-Stratus policy, with or without premium payments, in one or more of the
available investment funds (a maximum of 10 funds may be chosen). Clients can also choose to
receive regular cash withdrawal amounts if no further premiums are paid.

Two products are available:
•    Stratus Continuation without life insured (for continuation of non-Stratus sinking fund policies)
•    Stratus Continuation with life insured (for continuation of non-Stratus endowment policies)

With Stratus, Sanlam Life is trying to offer clients transparent, good value for money products. After
recovery of certain fees, Sanlam Life purchases units for the client with his net investment.

The client may choose more than one investment fund per policy, and can switch between available
funds at any time.

INITIAL TERM

No initial term applies for continuations. There is no specific date on which the policy will mature. The
policy will continue until the policyholder claims the proceeds or until the death of the life insured where
applicable. The policy value is available at any time.

AVAILABLE INVESTMENT FUNDS

See section E(1).

SWITCHING BETWEEN INVESTMENT FUNDS

See section C(3).

INVESTMENT GUARANTEES

See section C(4).

THE INVESTMENT GUARANTEE DATE

•    If an investment guarantee is chosen, the policy has one investment guarantee date.
•    The investment guarantee date is five years after the continuation date.

PREMIUMS

The client can choose to continue the policy with or without the payment of recurring premiums provided
the continuation is done within the restrictions of Section 54.

Recurring premiums can only be payable either monthly or annually.

Premiums are payable by debit order, internal funding or magtape (electronic) stop order. No debit
order discount applies. Debit orders are permitted any day of the month up to and including the 31st.
                                                    st          th
The inception date is, however, always between the 1 and the 28 of the same month.

The premiums of a continued policy are as follows:

•    The continuation amount, after the deduction of the initial advisory fee (if any), is the single premium
     that is available for the continuation.
•    No advisory fee is payable on recurring premiums. The full recurring premium is therefore used as a
     premium on the policy.




GE 8/2006                                           BX 24
Minimum premiums

•   The minimum single premium (continuation amount minus initial advisory fee) is R10 000.
•   The minimum recurring premium is R150,00 per month.

Minimum ad hoc addition

Ad hoc single premiums can be added after the inception date. The minimum is currently R2 500 per
addition.

INCEPTION DATE

The inception date (continuation date) is the same as the date on which the existing policy matures.

AGE AT ENTRY

Any age is acceptable.

PREMIUM GROWTH

Premium growth is optional on these policies. The client can choose a fixed rate, or can choose that
premiums increase at the consumer price index (CPI).

•   Fixed growth rate

    Any percentage of premium growth between 5% (minimum) and 20% (maximum) can be chosen.

•   Consumer price index (CPI)

    When the increase is determined on the basis of the inflation rate, the change in the consumer price
    index, or any other commonly accepted method of measuring inflation that may apply at the time, will
    be taken into account. The minimum increase every year will be 5%. This minimum can be
    changed from time to time.

    An illustrative rate of 5% is used to illustrate premiums and values when premium growth is chosen
    at CPI.

A maximum of two premium increases may be skipped, after which premium growth will lapse.

RIDER BENEFITS

No rider benefits are available.

LIFE COVER AND DISABILITY BENEFITS

No life cover or disability benefits are available.

DEATH BENEFITS

With life insured

At the death of the life insured, the value of the policy investment as at the date on which Sanlam Life
received notification of the death, is payable. If the policyholder chose the investment in the case of an
investment fund where such a guarantee is available, a minimum rate of return is guaranteed on the
investment in each investment fund for which an investment guarantee was chosen.

Without life insured

No death benefit is payable at the death of the policyholder (no life insured is involved). The policy is
continued until it is surrendered. If the policyholder appointed a nominee for policy-ownership, that
nominee will become the new policyholder after the death of the existing policyholder, if he/she accepts
the nomination at that stage. If there is no such nominee at the death of the policyholder, the policy will
be an asset in the policyholder’s estate.




GE 8/2006                                             BX 25
FULL OR PARTIAL CASH WITHDRAWALS

•   Full, or partial, cash withdrawals can be made.
•   No termination fee is presently charged if a full or a partial cash withdrawal is made.
•   Cash withdrawals can be made at any time.
•   On policies with more than one underlying investment fund the client has two options:
    −   Cash withdrawal from one specific fund as a percentage of that fund (must be requested as a
        percentage of the value of the policy investment), or
    −   Proportional cash withdrawal from all underlying investment funds - the client chooses an
        amount or a percentage proportional to each fund.

REGULAR CASH WITHDRAWALS

The policyholder can make regular cash withdrawals on a Stratus Continuation policy if the policy meets
the minimum requirements. This facility is available only if no premiums are paid in terms of the policy.
This means that a policy on which premiums are being paid currently, must be made fully paid-up before
regular cash withdrawals can be made in terms of such a policy.

Products on which regular cash withdrawals can be taken

•   Stratus Continuation with life insured
•   Stratus Continuation without life insured

Types of regular cash withdrawals

Two types of regular cash withdrawals can be made:

•   A fixed sum can be withdrawn from specified funds ("fixed amount"), or
•   The investment return on the policy investment in the Guaranteed Capital Fund, while the value of
    the policy investment remains constant ("growth only").

If a fixed amount is withdrawn from more than one investment fund, the withdrawal will be made
proportionally from the chosen investment funds

NB: For regular cash withdrawals of investment return the Guaranteed Capital Fund must be
    chosen. This applies only for the withdrawal of investment return, and not for withdrawal of
    a fixed amount.

Information in the proposal form

The policyholder must specify the following information in the proposal form (item number AEB2009/
AEB2013/ AEB2039):

•   Type of regular cash withdrawal (“fixed amount” or “growth only”)
•   The amount constituting the fixed amount that is withdrawn (if a fixed sum is chosen)
•   The frequency of the regular cash withdrawal (only monthly or annually)
•   Date on which first cash withdrawal sum is required. This date may not be more than three months
    in the future for monthly withdrawals. The date for yearly withdrawals may not be more than 12
    months in the future.
    NB: This date is the date that is used to determine the selling price at which units are sold to
          provide the first cash withdrawal sum. However, the payment of the cash withdrawal
          amount takes place, at least two working days later. Subsequent amounts are
          determined and paid in the same way every month or year.
•   The name(s) of the chosen investment fund(s) from which the cash withdrawal(s) must be funded

NB: Only one instruction at a time is possible for regular cash withdrawals. For example, it is
    not possible to request two different amounts from two different investment funds for the
    cash withdrawals.




GE 8/2006                                          BX 26
Alterations to regular cash withdrawals

After the policyholder has started to receive regular cash withdrawals, he can request the following
alterations with regard to the cash withdrawals:

•     The amount of the regular cash withdrawals can be changed.
•     The frequency of the payments can be changed from monthly to annually (and vice versa).
•     The date on which the regular cash withdrawal amounts are paid, can be changed.

When the policyholder makes any change to his regular cash withdrawals, Sanlam Life may again apply
the minimum requirements that apply for regular cash withdrawals.

Minimum requirements

    Minimum cash withdrawal               R150,00 per frequency (both monthly and annually)
    amount
                                          If the policyholder has chosen to withdraw the growth in the
                                          value of the policy investment monthly/annually, this growth will
                                          be paid out only if it is R150,00 or more. If the growth is less
                                          than R150,00 per frequency, the payment will be held over until
                                          the date of the next payment. Only one such a payment can be
                                          skipped. If the subsequent payment (together with the skipped
                                          payment) is still below R150,00, the regular cash withdrawals
                                          will be suspended.
    Maximum cash withdrawal               The total cash withdrawal amount per annum may not exceed
    amount                                20% of the value of the policy investment.
    Minimum value of the policy           R20 000        This minimum applies in respect of the investment
    investment                                           fund(s) out of which the regular cash withdrawals
                                                         are funded (which is not necessarily the whole
                                                         policy investment).
    Minimum remaining value of the        R2 500         (If at any stage the value of the policy investment
    policy investment after each                          decreases to below this minimum, the cash
    withdrawal                                            withdrawals will be stopped immediately.)

Tax

In terms of current legislation these regular cash withdrawal amounts are not taxable in the hands of the
policyholder. Sanlam Life already pays tax on behalf of the policyholder on any taxable profits in the
investment portfolio. The regular cash withdrawal amounts are therefore after-tax money.

LOANS

•     Loans are available two months after the continuation date.
•     No loan administration fee is currently charged.
•     A number of units (in the underlying investment fund(s)) to the value of the loan amount granted, will
      be switched to units in the Stratus Policyholder Loan Fund. The latter fund does not participate in
      any growth. Settling the loan would result in a switch of units in the Stratus Policyholder Loan Fund
      to units in the policy's investment fund(s) - at the then prevailing selling price of the relevant
      investment fund(s). If the price of the units in the policy's investment fund(s) at that stage is higher
      than it was when the loan was entered into, it means that fewer units will be switched to the policy's
      investment fund(s). The repayment amount may not exceed the loan amount (without the loan levy).
      If the full loan is repaid in one installment, the value of the units on the repayment date will, however,
      be equal to the value of the units that were cancelled when the loan was entered into (loan levy
      excluded). The investment return that the policyholder does not get during the loan period, can be
      regarded as “interest paid” over the loan period.
•     The minimum loan amount is R2 000. The remaining value of the policy investment must be at least
      R2 500 after the loan has been granted.
•     Repayments can be made at any time.




GE 8/2006                                             BX 27
ALTERATIONS

The following alterations may be done:

•   Addition of an ad hoc lump sum after inception date (minimum of R2 500).
•   Increase/decrease of recurring premiums. The minimum increase is R70,00 per month. The
    premium or contribution after a decrease must meet the minimum new business requirement, and
    must therefore be at least R150,00 a month at present.

BENEFICIARY TO RECEIVE DEATH BENEFITS

No beneficiaries may be appointed if there is no life insured. A maximum of 10 beneficiaries may be
appointed if there is a life insured.

POLICY-OWNERSHIP

Only one policyholder is allowed per policy. Only one nominee for ownership is allowed

CESSIONS

The policyholder may do a collateral or outright session.

TAX

No tax is payable on the proceeds of the policy. Sanlam already pays tax in the chosen investment
fund.




GE 8/2006                                         BX 28
    STRATUS RETIREMENT ANNUITY

DESCRIPTION

The Stratus Retirement Annuity is a policy that the Central Retirement Annuity Fund (CRAF) or PPS
Retirement Annuity Fund (for PPS members) uses to finance the benefits that it must pay to its
members.

As a member of the Fund the member makes a contribution(s) to the Fund to receive benefits from it.
To fund these benefits, the Fund takes out a policy on the member’s life with Sanlam Life. The Fund is
the owner of the policy and uses the member’s contribution(s) to pay the investment amount and/or
premiums. The information below will give an indication of the benefits the member can expect to
receive from the Fund.

With Stratus, Sanlam Life wants to offer clients transparent, good value for money products. After
certain fees have been subtracted, Sanlam Life uses the net investment to purchase units for the client’s
benefit.

The member chooses that the investment be invested in one or more of the available investment funds
(a maximum of 10 funds may be chosen) in a non-risk policy (without cover).

The member may switch between the available investment funds at any time.

Two variations of Stratus Retirement Annuity are available, depending on the chosen commission
structure:

•   Stratus/PPS Retirement Annuity
•   Stratus/PPS Retirement Annuity (recurring commission)

See section F for more information regarding the purpose of a retirement annuity, income tax and estate
duty.

INITIAL TERM

•   The member selects, for new policies and conversion, a retirement date when taking out the policy.
•   This retirement date can be any date from the member’s fifty-fifth birthday up to and including the
    member’s seventieth birthday. The period from the inception date up to and including the chosen
    retirement date is called the initial term.
•   For recurring contributions a minimum term of two years apply.
•   For a conversion the client may also select the retirement date to be the same as that of the policy
    that is converted, subject to a minimum of one year. Incomplete years are permitted. For a
    conversion, the term may not be shorter than the outstanding term of the policy that is converted, but
    with a further minimum of one year. Otherwise the minimum term for single premium policies is one
    year and for recurring premium policies two years. However, if the policy is invested in an
    investment fund to which an investment guarantee applies, or if the policy is invested in the Vesting
    Bonus Fund, the minimum term is 5 years.
•   After the initial term has expired, and if the member is not 70 yet, the term is open-ended. This
    means that the policy will not not automatically be paid out when the initial term has expired, but that
    the policy will continue until the member informs Sanlam Life that the policy must be terminated, until
    the death of the life insured or until the member’s seventieth birthday – whichever comes first.

THE OPTION DATE

The member chooses an initial term when he or she takes out the policy or on the conversion date (with
conversions). The date at the end of the initial term is the option date.

If the option date is before the member’s 70th birthday, the policy will continue automatically after the
option date if the member or the Fund does not notify Sanlam Life that the available retirement benefit
must be paid out. The policy can continue with or without further premium payments. The member
must take the retirement benefit before his/her 70th birthday.




GE 8/2006                                          BX 29
RETIREMENT BENEFIT AVAILABLE ON OPTION DATE

On the option date, the amount to which the policy investment has grown, will be available for the
provision of the retirement benefit. If the member takes the available amount, the policy will be
terminated.

If no investment guarantee was chosen, the value of the policy investment will not be guaranteed. If the
member chose an investment guarantee in the case of an investment fund where such a guarantee is
available, a minimum rate of return is guaranteed on the investment in each investment fund for which
an investment guarantee was chosen.

Sanlam Life, on behalf of the Fund, may pay out up to one-third of the available amount in a lump sum
to the member. The balance must be used to provide the member with regular pension payments. Or,
depending on the member’s choice, the entire amount available can be used to provide the member
with regular pension payments.

If the member does not take the retirement benefit on the option date, the policy will not be terminated.
And, except where the member or the Fund informs us otherwise, we will continue the policy investment
in the investment fund(s) in which it is invested at that stage, for further growth. If the member wants the
policy investment to continue, but he or she wants to stop the payment of recurring contributions after
the option date, he or she must inform us accordingly at that stage.

After the initial term has expired (therefore after the option date), the retirement benefits can be taken at
any time, up to the day before the member’s 70th birthday. At present, no alteration fee is applicable
after the option date. Sanlam Life may change this at any time.

If the member indeed wants to take the value of the policy investment on the option date, he or she
must, on behalf of the Fund, inform Sanlam Life accordingly before or on that date. Sanlam Life will
then send the member the necessary forms to complete and return to Sanlam Life.

The member can also apply for the policy to be ceded to him or her, on conditions determined by the
Fund.

The member must take the retirement benefit before his/her 70th birthday.

ENDOWMENT OPTION FOR RETIREMENT ANNUITIES

See section C(5).

AVAILABLE INVESTMENT FUNDS

See section E(1).

SWITCHING BETWEEN INVESTMENT FUNDS

See section C(3).

STRATUS LIFE TIME INVESTMENT OPTION

See section C(6).

INVESTMENT GUARANTEES

See section C(4).

THE INVESTMENT GUARANTEE DATE

•   If an investment guarantee was chosen, the policy has at least one investment guarantee date.
•   The first investment guarantee date is determined as follows:
    −   If the option date is later than 15 years after inception date, the first investment guarantee date is
        10 years after inception date. Further investment guarantee dates depend on the remaining initial
        term. See section C (4) for a further explanation of these dates.
    −   If the option date is 15 years or less after the inception date, there is only one investment
        guarantee date and is it the same as the option date.



GE 8/2006                                           BX 30
CONTRIBUTIONS

The member can choose to make one of the following contributions:

•     Single contribution
•     Recurring contributions
      −     must be chosen when taking out the policy
•     A combination of a single contribution and recurring contributions

Recurring contributions can only be payable monthly or annually.

Recurring contributions can be paid by debit order or stop order (electronic premium schedule only). No
debit order discount applies. If contributions for new business are not paid by debit order, a collection
premium of 3,5% of the contribution, excluding the collection premium, will be charged. Debit orders are
permitted for any day of the month up to and including the 28th.

The minimum contribution is as follows:

                                                                  Recurring premium per
                                                                                1
                                                   Ad hoc                 month
                                                                                                Recurring
                                      Single       addition                                     premium
                                     premium                    Initial term     Initial term
                                                    (single                                     increase
                                                                10 years or     less than 10
                                                  premium)
                                                                   more             years3
    Non-conversions:
       Single premium only:           R 2 500       R2 500           N/a             N/a            N/a

          Single premium plus
            recurring premiums:       R2 500        R2 500          R150            R300            R70

          Recurring premium only
          (upfront commission):         N/a         R2 500          R150            R300            R70

          Recurring contribution
          only (recurring
          commission):                  N/a         R2 500          R100            R100            R70

          If part of Stratus and
          Matrix combination
          product:                      N/a          N/a            R100            R225            N/a
                                              2
    Conversions                       R2 500        R2 500          R150            R300            R70

1
    The minimum amount that may be invested per investment fund is R50,00.
2
    This relates to the transfer amount from the old (converted) policy.
3
    For initial terms shorter than 5 years, the minimum recurring contribution, if applicable, is R500,00 per
    month. This also applies if the policy is part of a Stratus and Matrix combination product.

INCEPTION DATE

In the case of new business, the inception date is determined by the type of contribution made and is
as follows:

•     Recurring contributions

      −     The inception date can be any day of the month, subject to the payment method. The day on
            which the first contribution is payable, is the inception date of the policy.
      −     If the mode of payment is per debit order, the inception date can be any day up to and including
            the 28th of the month.
      −     If the mode of payment is per stop order, the inception date will always be the 1st of the month
            and it must be a stop order with electronic scheduling.
      −     Recurring contributions must be selected from inception date.




GE 8/2006                                            BX 31
• Initial amount / investment amount (single premium)

    The inception date is the date on which the single contribution is paid in at any contracted bank
    branch (currently ABSA or First National Bank). It can be any day of the month up to and including
    the 31st.

• Combination of single contribution and recurring contributions

    The recurring contribution will, in accordance with the rules stated under “Recurring premium”
    above, determine the inception date.

The policy will not come into being before membership of the Fund is accepted.

In the case of conversions to Stratus Retirement Annuity, the conversion date is the date on which
the conversion becomes effective. The date is always the 1st of the month.

NB:
•   Intermediaries must pay in members’ cheques (where applicable) as soon as possible,
    because that date determines the inception date and the price at which units are purchased.
    If there are huge market fluctuations between the date on which the member hands over the
    cheque to the intermediary and the day on which the cheque is paid in, claims could be made
    against the intermediary and Sanlam Life. Intermediaries will be held personally responsible
    for such claims.
•   The backdating of recurring premium policies to beyond the beginning of a tax year is not
    permissible. No back-dating for single premiums is permissible.

AGE AT ENTRY AND RETIREMENT

The minimum and maximum ages at entry are as follows:

•   Minimum age at entry             :     1 anb for CRAF policies (if part of a Stratus and Matrix
                                         combination product, the minimum age at entry is 15 anb)
                                     :   15 anb for PPS policies
•   Maximum age at entry             :   the day before the member's 70th birthday, less minimum term
•   Minimum age at retirement        :   the member's 55th birthday
•   Maximum age at retirement        :   The maximum age at retirement is the day before the member's
                                         70th birthday.

PREMIUM GROWTH

Premium growth on these policies is optional. The member can choose a fixed rate, or can choose that
contributions should increase at the consumer price index (CPI) rate. Automatic premium growth can
only take place on a policy anniversary.

• Fixed growth rate
    Any percentage premium growth between 5% (minimum) and 20% (maximum) can be chosen.

• Consumer price index (CPI)
    When the increase is determined on the basis of the inflation rate, the change in the consumer price
    index, or any other commonly accepted method of measuring inflation that may apply at the time, will
    be taken into account. The minimum increase every year will be 5%. This minimum can be
    changed from time to time.

A maximum of two contribution increases may be skipped, after which premium growth will lapse.




GE 8/2006                                        BX 32
FLEXI GROWTH

•   Flexi growth may only be taken with a Stratus Retirement Annuity which forms part of a scheme.
•   With Flexi growth any number of increases per year can be requested.
•   The increase must take place on the same day of the month as the inception date of the policy.
•   Every time an increase is requested, any amount or percentage can be requested, subject to a
    minimum increase of 5% at a time.
•   This type of premium growth is available only on policies with a monthly frequency.
•   A requested premium increase in terms of Flexi growth may not be cancelled.
•   Flexi growth can be added to an existing Stratus policy that forms part of a scheme

RIDER BENEFITS

The following rider benefits are available optionally:
•   waiver of premium with future growth at disability
•   waiver of premium without future growth at disability

The benefit is available for new business and conversions.

LIFE COVER AND DISABILITY BENEFITS

No life cover or disability benefits are available. For conversions, if the policy that is converted made
provision for life cover and/or disability benefits, this cover and/or benefits will no longer apply after the
conversion.

DEATH BENEFIT

At the death of the member, the value to which the policy investment has grown, as on the date on
which Sanlam Life has received notice of the member’s death, will be available for the benefit of the
member’s dependants and/or nominees, as set out in the Rules of the Fund. If the member chose the
investment guarantee in the case of an investment fund where such a guarantee is available, a
minimum rate of return is guaranteed on the investment in each investment fund for which an
investment guarantee was chosen.

The Fund may only pay out a limited amount. The balance must be used to provide the member’s
dependants and/or nominees with regular pension payments, or the full amount can be used to provide
regular pension payments.

BENEFITS AVAILABLE BEFORE AND AFTER THE OPTION DATE

•   The member can receive retirement benefits from the Fund at any time from his or her 55th and up to
    the day before his/her 70th birthdays. However, should the member become permanently and
    continuously unable to engage in his/her occupation, he or she could receive the retirement benefit
    before his or her 55th birthday.
•   From the member’s 55th birthday, the available retirement benefit is equal to the value of the policy
    investment at the time, minus an alteration fee.

LOANS

No loans are permitted against retirement annuities.

MAKING PAID-UP

The policy can be maid paid-up (VOP) at any stage, subject to a minimum remaining fund value
(currently R50).




GE 8/2006                                           BX 33
ALTERATIONS

The following alterations may be done:
•   Addition of an ad hoc single contribution.
•   Increase in/decrease of recurring contributions. The minimum increase is R70,00 a month. The
    contribution after a decrease must comply with the minimum new business requirement, and must
    therefore be at least R150,00 at present.

APPOINTMENT OF NOMINEE(S) TO RECEIVE DEATH BENEFIT

•   There is no restriction on the number of nominees that may be appointed.
•   In terms of legislation, the Fund must pay the death benefit of a retirement annuity as follows:
        − to one or more of the member’s dependants; or
        − if the member nominated someone other than a dependant, to one or more of the member’s
            dependants and the nominated person or persons.
•   The member’s spouse, child (also a child who has reached maturity) and/or any person who, in law
    or in fact, is dependent on the member for financial support or, a person who would have been
    dependent on the member had the member lived, qualify as dependants.
•   The Board of Trustees of the Fund will decide whether sufficient provision has been made for the
    needs of the member’s dependants. If a nominee is not a dependant, the Trustees of the Fund have
    a discretion as to whether and to what extent, such nominee will share the death benefit with the
    dependants.
•   The member can cancel or change the nominee’s appointment. A notice to this effect, signed by the
    member, must reach Sanlam Life before the member’s death. Because the circumstances of people
    change from time to time, Sanlam Life recommends that the member regularly revises the
    appointment and inform Sanlam Life of any changes.
•   Unless a nominee accepts the appointment, the nominee will not be considered to receive death
    benefits. However, the appointment cannot be accepted before the member’s death.

COOLING-OFF PERIOD

No cooling-off period applies.

TAX

Tax must be paid on the lump sum, after taking the tax concessions into account, as well as on the
income of the compulsory life annuity.




GE 8/2006                                       BX 34
    STRATUS INTERNATIONAL RETIREMENT ANNUITY

DESCRIPTION

Stratus International Retirement Annuity is a policy used by the Central Retirement Annuity Fund
(CRAF) or PPS Retirement Annuity Fund (for PPS members) to fund the benefits that it has to pay to its
members. The proceeds are paid in the currency of the investor’s choice.

As a member of the Fund the member makes a contribution(s) to the Fund to receive benefits from it.
To fund these benefits, the Fund takes out a policy on the member’s life with Sanlam Life. The Fund is
the owners of the policy and uses the member’s contribution(s) to pay the investment amount and/or
premiums. The information below will give an indication of the benefits the member can expect to
receive from the Fund.

This investment is made in terms of the concession by the SA Reserve Bank to individual South African
residents to invest a total of R750 000 offshore. This concession is usually used for investment
purposes and could include the payment of premiums on a policy and contributions to above-mentioned
Funds.

To meet the requirements to offer an investment of which the proceeds may be paid in a foreign
currency, Sanlam Life established a branch on the isle of Jersey. This branch trades as Sanlam Jersey.

INVESTMENT PROCESS

•   The member invests a single contribution, recurring contributions or a combination of a single and
    recurring contributions.
•   The member pays an agreed amount in rand. The rand amount is converted to American (US)
    dollars, pound sterling and/or euro (depending on the investment fund(s) chosen) in order to pay the
    premiums on the policy.
•   Units are purchased in the currency of the chosen investment fund(s).
•   The assets of the underlying investment fund(s) are 100% internationally based.
•   The proceeds of the policy are, subject to certain conditions, paid in Jersey in the foreign currency of
    the member’s choice.
•   All communication to the member is done in rand value.

INITIAL TERM

•   The member selects a retirement date when taking out the policy.
•   This retirement date can be any date from the member’s fifty-fifth birthday, up to and including the
    day before the member’s seventieth birthday. The period from the inception date up to and including
    the chosen retirement date is referred to as the initial term.
•   For recurring contributions (with or without a single contribution) a minimum term of 5 years apply.
    For single contributions only, a minimum term of 1 year applies.
•   After the initial term has expired, and provided the member is not 70 years old yet, the term is open
    ended. This means that the policy will not automatically be paid out when the initial term has
    expired, but that the policy will continue until the member notifies Sanlam Life that the policy must be
    terminated, until the death of the life insured, or until the member’s seventieth birthday – whichever
    comes first.

THE OPTION DATE

The member chooses an initial term when he or she takes out the policy. The date at the end of the
initial term is the option date. If the option date is before the member’s 70th birthday, the policy will
continue automatically after the option date if the member or the Fund does not notify Sanlam Life that
the available retirement benefit must be paid out. The policy can continue with or without further
premium payments. The member must take the retirement benefit before his/her 70th birthday.




GE 8/2006                                          BX 35
RETIREMENT BENEFIT AVAILABLE ON OPTION DATE

On the option date the sum to which the policy investment has grown, will be available for the provision
of the retirement benefit. The value of the policy investment is not guaranteed. If the member takes the
available retirement benefit, the policy will be terminated.

Sanlam Life, on behalf of the Fund, may pay up to one-third of the available amount on option date as a
lump sum to the member. The balance must be used to provide the member with regular pension
payments. Or, depending on the member’s choice, the entire amount available can be used to provide
the member with regular pension payments.

If the member does not take the retirement benefit on the option date, the policy will not be terminated.
And, except where the member or the Fund informs us otherwise, we will continue the policy investment
in the investment fund(s) in which it is invested at that stage, for further growth. If the member wants the
policy investment to continue, but he or she wants to stop the payment of recurring contributions after
the option date, he or she must inform us accordingly at that stage.

After the initial term has expired (therefore after the option date), the retirement benefits can be taken at
any time, up to the day before the member’s 70th birthday. At present, no alteration fee is applicable
after the option date. Sanlam Life may change this at any time.

If the member indeed wants to take the value of the policy investment on the option date, he or she
must, on behalf of the Fund, inform Sanlam Life accordingly before or on that date. Sanlam Life will
then send the member the necessary forms to complete and return to Sanlam Life.

The member can also apply for the policy to be ceded to him or her, on conditions determined by the
Fund.

The member must take the retirement benefit before his/her 70th birthday.

CONDITIONS TO QUALIFY FOR THE PRODUCT

See Section AA for conditions to which the clients must comply to qualify for Stratus International
Retirement Annuity policy.

AVAILABLE INVESTMENT FUNDS

See section E(1).

SWITCHING BETWEEN INVESTMENT FUNDS

See section C(3).

INVESTMENT GUARANTEES

Not available.

CONTRIBUTIONS

The member can choose to make one of the following contributions:

•   Single contribution
•   Recurring contributions
    −   must be chosen when taking out the policy
•   A combination of a single contribution and recurring contributions

The first contribution of a recurring contribution policy may not be paid in cash.

Recurring contributions can only be payable monthly or annually.

Recurring contributions can only be paid by debit order. No debit order discount applies. Debit orders
are permitted for any day of the month up to and including the 28th.




GE 8/2006                                          BX 36
The minimum contribution is as follows:

                                                                Ad hoc
                                                                addition       Recurring      Recurring
                                           Single
                                                                 (single      contribution   contribution
                                         contribution
                                                              contribution)    per month1      increase


    Single contribution only:               R10 000              R2 500           N/a            N/a

    Single contribution plus
      recurring contribution:               R2 500               R2 500          R750            R70

    Recurring contribution only:              N/a                R2 500          R750            R70
     1
         The minimum amount that may be invested per investment fund is R50,00.

Other aspects:

•    The member pays an amount to Sanlam Life in Rand. The Rand amount remains constant and is
     not affected by the exchange rate. The amount of US dollars, pound sterling or euro for which it is
     converted will vary according to the exchange rate.
•    If the policyholder (member) and the premium payer differ, the form “Declaration International Policy
     : Premium payer is someone other than the proposer” must be completed. The form is available on
     the Brokers and Advisers Web as well as on Notes.
•    If the twelve-monthly tax clearance certificate is at any stage refused, the collection of recurring
     contributions ceases. The amount of the contributions paid up to that stage, will determine whether
     the policy can be made paid-up or whether it will lapse. Also refer to “Choices if tax clearance
     certificate is not longer granted” below.
•    No back-dating is allowed.
•    The proposal and original document for proposals submitted at the end of February must reach New
     Business in time to ensure the issuing can take place in time to qualify for tax relief. Therefore,
     enough time must be allowed for the different administrative actions.
     −     All documents must reach New Business: Millennium at least five working days before 28
           February to be issued successfully on or before 28 February.
     −     The policy’s inception date must be during February.

INCEPTION DATE

The inception date is determined by the type of contribution made and is as follows:

• Recurring contributions
     The inception date can be any day up to and including the 28th of the month. The day on which the
     first premium is payable, is the inception date of the policy.

• Single contributions
     The inception date is the day on which the single contribution is deposited in the Sanlam Jersey
     bank account, after being converted to the relevant foreign currency. This can take place on any
     day of the month up to and including the 31st.

• Combination of single contribution and recurring contributions
     This combination may be chosen only when the policy is effected. The recurring contribution will in
     accordance with the rules stated under “Recurring contributions” above, determine the inception
     date of the policy.




GE 8/2006                                             BX 37
INCEPTION DATE (continued)

The policy will not come into being before membership of the Fund is accepted.

NB:
Intermediaries must pay in members’ cheques (where applicable) as soon as possible, because
that date determines the inception date and the price at which units are purchased. If there are
huge market fluctuations between the date on which the member hands over the cheque to the
intermediary and the day on which the cheque is paid in, claims could be made against the
intermediary and Sanlam Life. Intermediaries will be held personally responsible for such
claims.

AGE AT ENTRY AND RETIREMENT

The minimum and maximum entry and retirement ages are as follows

•   Minimum age at entry             :   19 anb
•   Maximum age at entry             :   the day before the member's 70th birthday, less minimum term
•   Minimum age at retirement        :   56 anb
•   Maximum age at retirement        :   The maximum age at retirement is the day before the member's
                                         70th birthday.

NB:
Currently the member must already be 18 years old to obtain permission from the South African
Revenue Service to transfer money offshore.

PREMIUM GROWTH

Premium growth on these policies is optional. The member can choose a fixed rate, or can choose that
contributions should increase at the consumer price index (CPI) rate. Automatic premium growth can
only take place on a policy anniversary.

•   Fixed growth rate
    Any percentage premium growth between 5% (minimum) and 20% (maximum) can be chosen.

•   Consumer price index (CPI)
    When the increase is determined on the basis of the inflation rate, the change in the consumer price
    index, or any other commonly accepted method of measuring inflation that may apply at the time, will
    be taken into account. The minimum increase every year will be 5%. This minimum can be
    changed from time to time.

A maximum of two contribution increases may be skipped, after which premium growth will lapse.

RIDER BENEFITS

No rider benefits are available.

DEATH BENEFIT

At the death of the member the value of the policy investment as on the date on which Sanlam Life
received notice of the death, is available for the benefit of the member’s dependants and/or nominees,
as set out in the Rules of the Fund.

The Fund may only pay a limited amount in cash. The balance must be used to provide regular pension
payments to the member’s dependants and/or nominees. Or the full amount can be used to provide
regular pension payments.




GE 8/2006                                         BX 38
BENEFITS AVAILABLE BEFORE OR AFTER THE OPTION DATE

•   The member can take the retirement benefit any time from his or her 55th and up to the day before
    his or her 70th birthday, but must take it before or on his/her 70th birthday. If, however, the member
    becomes occupationally disabled before his or her 55th birthday, he or she can receive the benefits
    before his or her 55th birthday already.
•   From the member’s 55th birthday the available early retirement benefit is equal to the value of the
    policy investment at that stage, minus an alteration fee (if the benefit is required before the option
    date).

LOANS

No loans are allowed in the case of retirement annuities

PAYMENT OF BENEFITS

The benefits can be payable in one of the following events:
•   on the option date (never before age 55);
•   at the death of the member;
•   the member can choose to take the retirement benefit at any time from his or her 55th birthday but
    before his or her 70th birthday; or
•   at early retirement due to occupational disability.

All lump sum benefits, after deducting tax payable to the South African Revenue Service (SARS), will be
paid in Jersey in the currency of the chosen investment fund(s). However, the person to whom payment
must be made, can request Sanlam Life to pay it in any other currency, into a bank account in the
country of his or her choice. Any currency charges or other bank charges, will be deducted from the
amount payable.

If the life annuity policy that has to provide the regular pension payments is taken out with Sanlam Life in
Jersey, Sanlam Life will pay the regular pension installments in Jersey in the currency of the chosen
investment fund(s), after deducting tax payable to SARS. The person to whom payment must be made,
can request us to convert the foreign currency amounts to any other currency and deposit it in a bank
account indicated by him or her, in Jersey or elsewhere. Currency charges and other bank charges will
then be deducted from each amount payable.

If the life annuity policy that has to provide the regular pension payments must be taken       out in South
Africa, the foreign currency amount to be used for taking out the life annuity policy will be   converted to
rand and transferred to South Africa. Currency charges and other bank charges will then         be deducted
from this amount. The regular pension payments will then be paid in rand in South               Africa, after
deducting tax payable to SARS.

MAXIMUM ALLOWANCE

An individual may not invest more than R750 000 in total overseas. In order to ensure that this happens,
all investments taken out of the country in terms of the R750 000 allowance must be taken into account.
This includes international investments such as policies, unit trust investments, bank accounts, etc.
Where international policies are concerned, the following existing and new policies at Sanlam Life and
other insurers must be taken into account:

•   Lump-sum investments.
•   Recurring premiums as an annual amount, multiplied by die policy term. As soon as a policy's total
    premiums during the policy term is more than the maximum permitted allowance at the time
    (R750 000 at present), the policy is made fully paid-up (VOP).
•   Premium growth on recurring premiums during the policy term.

The above calculation does not include amounts of policies where an offshore investment fund (such as
the Offshore Equity Fund) has been selected.

As soon as a client has used the maximum permitted allowance, lump-sum additions or premium
payments cannot be done on existing International policies.




GE 8/2006                                           BX 39
CHOICES IF THE TAX CLEARANCE CERTIFICATE IS NO LONGER GRANTED

Unfortunately, should further contributions to an existing Stratus International Retirement Annuity
become impossible because the South African Revenue Service (SARS) does not issue a tax clearance
certificate to the client, such a policy will have to be made paid-up (VOP). Clients can replace their
International policies with local Stratus policies, with one or more of the available investment portfolios
as an investment fund. This is how it works:

If the client is not able to obtain tax clearance in order to invest further funds offshore, Sanlam will send
a letter to the client informing him or her that the policy will be made paid-up (VOP). However, the client
is encouraged to continue the present premium on a new local Stratus policy, with one or more of the
available portfolios as an investment option.

A Stratus International Retirement Annuity can be replaced with a Stratus Retirement Annuity. An
endowment policy cannot be replaced with an RA, and vice versa.

The term of the new policy must be the same as the remaining term of the International policy that is
made VOP, subject to the minimum term for a new policy (presently five years).

If the policy is made VOP within the first two years of the term, commission must be clawed back from
the intermediary according to law.

Intermediaries can place themselves and the client in a neutral position by allowing the commission to
be cut on the new policy, so that the commission under the new policy is the same as the commission
that is clawed back on the old policy. At the same time Sanlam Life will cut its marketing costs
proportionately to the client’s benefit.

If the policy is made VOP after two years, no commission is clawed back. The new policy will therefore
have to be issued without commission to place the client in the same position as before the policy was
made VOP.

Special quotations for calculating the cut in commission are available and can be obtained from Product
Support at (021) 916-3082.

Intermediaries are under no obligation to take commission cut in the case of these policies, provided the
LOA Replacement Code, read with the replacement disclosure requirements in the General Code in
terms of FAIS, are complied with (i.e. the RPAR form - AE2794 - is completed with the client). The
objective is for intermediaries to be able to reach a compromise with their clients so that they do not
have to suffer losses as a result of the compulsory VOP, while the intermediaries do not suffer any
losses. A cut in commission can contribute to the sale of the new local Stratus policy.

Apart from the special quotation that has to be obtained, the rest of the process is the same as for any
other new policy. The proposal will therefore be treated like a normal new proposal. The new policy is
regarded as a replacement – the normal replacement requirements therefore apply.

ALTERATIONS

Premium increases/ decreases may be done. Premium growth may be added, changed or removed.

MAKING PAID-UP

The policy can be maid paid-up (VOP) at any stage, subject to a minimum remaining fund value
(currently R50).




GE 8/2006                                          BX 40
APPOINTMENT OF NOMINEE(S) TO RECEIVE DEATH BENEFIT

•   The maximum number of nominees to be appointed, is 10.
•   In terms of legislation the Board of Trustees of the Fund must pay the death benefit of a retirement
    annuity as follows:
       −    to one or more of the member’s dependants; or
       −    if the member has nominated someone else as a dependant, to one or more of the member’s
            dependants and the nominated person or persons.
•   The member’s spouse, child (also a child that has come of age) and/or any person who is dependent
    on the member for financial support, legally or actually, or a person who would have been dependant
    on the member if the member had been alive, qualifies or qualify as a dependant or dependants.
•   The Board of Trustees will decide whether sufficient provision was made for the needs of the
    member’s dependants. If a nominee is not a dependant, the onus rests on the trustees of the Fund
    to determine whether and to what degree such a nominee will share the death benefit with the
    dependants.
•   The member can cancel or change the appointment of the nominee. A notice in this regard, signed
    by the member, must reach Sanlam Life before the death of the member. Because people’s
    circumstances change from time to time, Sanlam Life recommends that the member revise the
    appointment regularly and notify Sanlam Life of any changes.
•   Unless a nominee accepts the appointment, that nominee will not receive the death benefit in terms
    of the policy. However, the appointment cannot be accepted before the member's death.

COOLING-OFF PERIOD

No cooling-off period applies.

TAX

Tax must be paid on the lump sum, after taking the tax concessions into account, as well as on the
income of the compulsory life annuity.




GE 8/2006                                        BX 41
    STRATUS RETIREMENT ANNUITY CONTINUATIONS


DESCRIPTION

Retirement annuities, in the CRAF or PPS funds, that were issued on the old administration system and
reached maturity, can be continued as Stratus Retirement Annuities. These retirement annuities can
therefore also share in all the benefits that a Stratus investment offers, for example that an investment
can be made in more than one investment fund, transparency, etc.

INITIAL TERM

No term is chosen. The member can retire from the Fund at any time up to and including the day before
his or her 70th birthday.

ENDOWMENT OPTION FOR RETIREMENT ANNUITIES

See section C(5).

AVAILABLE INVESTMENT FUNDS

See section E(1).

SWITCHING BETWEEN INVESTMENT FUNDS

See section C(3).

INVESTMENT GUARANTEES

See section C(4).

THE INVESTMENT GUARANTEE DATE

•   If an investment guarantee is chosen, the policy has one investment guarantee date.
•   The investment guarantee date is five years after the continuation date, except if the date five years
                                                        th
    after the continuation date is after the member's 70 birthday. In the latter instance the investment
                                         th
    guarantee date is the member's 70 birthday.

CONTRIBUTIONS

The continuation amount is used as a single contribution on the policy.

The member can also make recurring contributions (monthly or annually).

Premiums are payable by debit order only. No debit order discount applies. Debit orders are permitted
any day of the month up to and including the 28th.

The minimum contributions are as follows:
    •   Single contribution : R2 500
    •   Recurring contribution : R150 a month

INCEPTION DATE

The inception date (continuation date) is the same as the date on which the existing policy matures.




GE 8/2006                                         BX 42
AGE AT ENTRY AND RETIREMENT

The minimum and maximum ages at entry and retirement are as follows:

•   Minimum age at entry              :   On old policy maturity date, age 55 at least
•   Maximum age at entry              :   the day before the member's 70th birthday, less minimum term
•   Minimum age at retirement         :   the member's 55th birthday
                                                                          th
•   Maximum age at retirement         :   the day before the member’s 70 birthday

PREMIUM GROWTH

Premium growth on these policies with recurring contributions is optional. The member can choose a
fixed rate, or can choose that contributions should increase at the consumer price index (CPI) rate.
Automatic premium growth can only take place on a policy anniversary.

• Fixed growth rate
    Any percentage premium growth between 5% (minimum) and 20% (maximum) can be chosen.

• Consumer price index (CPI)
    When the increase is determined on the basis of the inflation rate, the change in the consumer price
    index, or any other commonly accepted method of measuring inflation that may apply at the time, will
    be taken into account. The minimum increase every year will be 5%. This minimum can be
    changed from time to time.

A maximum of two contribution increases may be skipped, after which premium growth will lapse.

FLEXI GROWTH

•   Flexi growth may only be taken with a Stratus Retirement Annuity which forms part of a scheme.
•   With Flexi growth any number of increases per year can be requested.
•   The increase must take place on the same day of the month as the inception date of the policy.
•   Every time an increase is requested, any amount or percentage can be requested, subject to a
    minimum increase of 5% at a time.
•   This type of contribution increases is available only on policies with a monthly frequency.
•   A requested contribution increase in terms of Flexi growth may not be cancelled.
•   Flexi growth can be added to an existing Stratus policy that forms part of a scheme.

RIDER BENEFITS

No rider benefits are available.

LIFE COVER AND DISABILITY BENEFITS

No life cover or disability benefits are available.

DEATH BENEFIT

At the death of the member, the value to which the policy investment has grown, as on the date on
which Sanlam Life has received notice of the member’s death, will be available for the benefit of the
member’s dependants and/or nominees, as set out in the Rules of the Fund. If the member chose the
investment guarantee in the case of an investment fund where such a guarantee is available, a
minimum rate of return is guaranteed on the investment in each investment fund for which an
investment guarantee was chosen.

The Fund may only pay out a limited amount. The balance must be used to provide the member’s
dependants and/or nominees with regular pension payments, or the full amount can be used to provide
regular pension payments.




GE 8/2006                                             BX 43
LOANS

The member may not take out a loan against a retirement annuity.

ALTERATIONS

The following alterations may be done:

•   Recurring contributions may be decreased. The reduced contribution must comply with the
    minimum new business requirement, and must therefore be at least R150,00 a month.
•   Recurring contributions may be increased, subject to a minimum increase of R70,00 a month.
•   Ad hoc single amounts may be added, subject to a minimum of currently R2 500.

TAX

Tax must be paid on the lump sum, after taking the tax concessions into account, as well as on the
income of the compulsory life annuity.




GE 8/2006                                      BX 44
    STRATUS INVESTMENT LINKED PENSION

DESCRIPTION

Stratus Investment Linked Pension is one of your clients' options for their retirement fund benefits at
retirement date.

The Stratus Investment Linked Pension is suitable for people who are retiring and who are prepared to
carry the investment risk of their retirement capital as well as the risk of outliving their capital,
themselves.

Sanlam Life is the owner of the underlying assets of the Stratus Investment Linked Pension.

ADVANTAGES OF THE PRODUCT

•   The Stratus Investment Linked Pension brings flexibility and investment choice to a compulsory life
    annuity at a member's retirement from a retirement fund.
•   The level of the pension is flexible and can be changed over time to suit the member's needs.
    Members (investors) can adjust their pensions annually within the limits of 5% and 20%, taking into
    account certain risks.
•   Investors have complete control over the investment choices for their retirement capital. This
    enables them to choose the investment funds in the Stratus range that suit their particular risk
    profile.
•   An appropriate investment mix should ensure a pension that is protected against the erosive effect
    of inflation.
•   With the Stratus Investment Linked Pension all your client's compulsory retirement capital that is
    available on the same date, can be combined. (Additional retirement capital cannot be added later
    to the same policy.)

DISADVANTAGES OF THE PRODUCT

The Stratus Investment Linked Pension provides no guarantees.          The investor will be exposed to
investment and longevity risks. These include:

•   the risk that the value of investments may drop and/or the return on investments may be lower than
    expected;
•   the risk that the investor may live longer than expected.

If the investor chooses too high a level of income, the investor may deplete his/her capital over time. If
the Stratus Investment Linked Pension is the investor's only source of income, Sanlam Life advises that
the pre-tax selected income should not exceed the medium term inflation outlook plus 2% per annum of
the capital. Currently that means a rate of not more than 8% per annum. If an income of more than 8%
is required to sustain the investor's lifestyle, he/she should consider a different type of pension. The
investor should ensure that he/she understands the impact of market fluctuations on his/her future
income.

If the total retirement capital is less than R1 million, the risks mentioned above are magnified and
require closer management on the investor's part.

Lifestyle and income requirements should be reviewed on an annual basis.

INITIAL TERM

No term is chosen because the investment has an open term.




GE 8/2006                                          BX 45
AVAILABLE INVESTMENT FUNDS

See section E(1).

SWITCHING BETWEEN INVESTMENT FUNDS

See section C(3).

INVESTMENT GUARANTEES

No investment guarantees are available.

Bonuses in the Vesting Bonus Fund will be declared in the usual way, and will be included in the
payment of the pension and death benefit. Switches from the Vesting Bonus Fund take place at the
market value of the investment in this investment fund.

The normal guarantee in the Guaranteed Capital Fund does not apply because the pension reduces the
capital in this investment fund.

PREMIUMS

The minimum single premium (investment amount) are as follows:
•   R100 000 per pensioner.
•   A minimum of R20 000 per investment fund applies (subject to the minimum of R100 000 per
    pensioner).
•   Special quotations must be obtained for purchase sums of R10 000 000 or more.

INCEPTION DATE

The inception date of the pension is the date on which the single premium is received. If the investment
originates from a Sanlam retirement annuity, for example, the inception date will be the same as the
date on which the retirement capital becomes available.

AGE AT ENTRY

The minimum and maximum ages at entry are as follows:
      Minimum : 15 anb
      Maximum : 100 anb

DEATH BENEFIT

At the death of the investor, the total value of the underlying investment funds will be available to the
nominees in the form of an investment linked annuity. Nominees also have the option to take an
accelerated annuity to be paid over a minimum period of 5 years. In the case of a minor, the minimum
term will be the greater of 5 years or the number of years to the age of 18. To the degree allowed in
terms of the law, the annuity can be commuted within 6 months of the investor's death. Such a lump
sum will be taxable at the investor's average tax rate.

PENSION INSTALLMENTS

•   The pension the investor may choose can be anything between 5% and 20% per year of the total
    value of the client’s capital (invested in all the selected investment fund(s)). This pension is paid by
    regularly cancelling units in the underlying investment funds.
•   The selected pension is calculated as a percentage of all the investment funds invested in. The
    investor therefore cannot choose to have the pension paid out of only part of the total investment
    (out of one of the selected investment funds, for example).
•   The investor may adjust the pension annually. The necessary forms will be provided every year.
•   The full pension instalment is taxable as income in the investor's hands.
•   The pension can be paid monthly, in arrear only.
•   At the proposal stage the member can choose to have the pension increased automatically at a
    specific rate every year.




GE 8/2006                                          BX 46
PHASING-IN OF PURCHASE SUM

The policyholder can choose to have the purchase sum phased in in the selected investment funds over
a period of up to 36 months. In such a case the single premium will be invested in the Sanlam Money
Market Unit Trust first.

The phasing-in can take place on a monthly, quarterly or half-yearly basis.

LIVES INSURED

Only one life insured (is also the investor/member) is permitted per investment.

APPOINTMENT OF NOMINEES

One or more nominees may be appointed to receive the pension after the death of the life insured. The
investor (life insured) may change such an appointment at any time. Sanlam Life must receive the
appointment, signed by the investor (life insured), before the life insured's death.

The nominees can choose to:

•   continue with the Stratus Investment Linked Pension on their own lives; or
•   receive instalments for five years (60 monthly pension instalments) so that the remaining capital is
    used up by the end of the five-year period. If the beneficiary is a child, the term of the term annuity
    is the greater of five years and the number of years until age 18.

Any pension which a nominee receives, is taxable as income in the hands of that nominee.

CESSIONS

No cessions are permitted.

PRIVATE PENSION

The Stratus Investment Linked Pension is only available as a private pension.

ADMINISTRATION OF THE POLICY

Investors can switch between the available investment funds to suit their changing risk profile. The
Stratus Investment Linked Pension is administered by Sanlam Personal Portfolios (SP²). SP² provides
the investor with the policy documents. It comprises a confirmation of investment and investment
certificate, in which the policy is referred to as the investment plan. SP² also provides the investor with
regular investment information.

TRANSFER OF POLICY

On request, SP² will transfer the Stratus Investment Linked Pension to a living annuity policy or
conventional life annuity policy issued by another insurer, or to a conventional life annuity policy issued
by Sanlam Life, provided the requirements of any directive issued by the Registrar for Long-term
Insurance are met.

COOLING-OFF PERIOD

No cooling-off applies. The pension may not be cancelled.

The policy may not be surrendered, pledged or ceded, and the benefits cannot be commuted.

TAX

Currently all interest, dividend or rental income, as well as capital growth within the investment funds are
exempt from income tax and capital gains tax.

Tax must be paid on the income received, according to the individuals personal situation.




GE 8/2006                                          BX 47
    STRATUS INTERNATIONAL INVESTMENT LINKED PENSION

DESCRIPTION

Clients can now use the available retirement benefits from their Stratus International Retirement
Annuities to purchase a foreign pension. The pension installments can be paid anywhere in the world in
the currency of the client’s choice.

FEATURES OF THE PRODUCT

•   Only transfers from the Stratus International Retirement Annuity are accepted.
•   The number of units held for the member’s benefit, multiplied by the published price(s) for the
    relevant investment fund(s), gives the rand value of the policy investment. This product does not
    provide units as defined in the Unit Trust Control Act, and accordingly is not regulated by that Act. It
    is a long-term policy regulated by the Long-term Insurance Act.
•   The single premium for the Stratus International Investment Linked Pension is transferred from the
    compulsory portion of the Stratus International Retirement Annuity.
•   The pension the member as investor and policyholder may choose can be anything between 5% and
    20% per year of the rand value of the investment fund(s) in which the investment is made. This
    pension is paid by regularly cancelling units in the underlying investment funds. The pension can be
    adjusted between the 5% and 20% limits annually on the policy anniversary. The investor must take
    note that he/she carries the investment risk (including currency risks) and the longevity risks and that
    he/she must be extremely cautious about his/her choice of underlying investment funds. Investors
    must be advised that the withdrawal rate should not exceed the inflation rate plus 2% (currently 8%)
    p.a. of the fund value. Investors whose total retirement capital is less than R1 million should include
    other more conservative pension choices as part of their total retirement plan (e.g. conventional life
    annuity). The proposal form contains an "Acknowledgement of Risks" declaration by the member.
    Intermediaries must take note of this and point it out to the member.
•   The selected pension is deducted proportionally from all the chosen investment funds. The investor
    therefore cannot choose to have the pension paid out of only part of the total investment (out of one
    or more of the selected investment funds, for example).
•   Pension installments are denominated in rands, but can be converted to any currency so that they
    can be paid out anywhere in the world. This is possible because the investment itself is off-shore.
    However, the client (investor) must take note that he/she must pay the cost for the conversion. This
    aspect is mentioned in the proposal form, and intermediaries must take note of this.

INITIAL TERM

No term is chosen because the investment has an open term.

AVAILABLE INVESTMENT FUNDS

See section E(1).

SWITCHING BETWEEN INVESTMENT FUNDS

See section C(3).

INVESTMENT GUARANTEES

No investment guarantees are available.

PREMIUMS

The minimum single premium is the rand equivalent of US $10 000, or the full compulsory portion of the
Stratus International RA (if the full compulsory portion is less than US $10 000).

INCEPTION DATE

The inception date of the pension is the same as the date on which the Stratus International Retirement
Annuity is paid out, viz the maturity date, accelerated maturity date or the date of the investor's death
(depending on the particular case).




GE 8/2006                                          BX 48
AGE AT ENTRY

The minimum and maximum ages at entry are as follows:
      Minimum : 56 anb
      Maximum : 100 anb

DEATH BENEFIT

At the death of the investor, the total value of the underlying investment funds will be available to the
nominees in the form of an investment linked annuity. Nominees also have the option to take an
accelerated annuity to be paid over a minimum period of 5 years. In the case of a minor, the minimum
term will be the greater of 5 years or the number of years to the age of 18. To the degree allowed in
terms of the law, the annuity can be commuted within 6 months of the investor's death. Such a lump
sum will be taxable at the investor's average tax rate.

PENSION INSTALLMENTS

•   The member can either choose a rand amount of pension or a pension percentage (between 5%
    and 20% of the fund value).
•   The rand amount of pension the investor may choose can be anything between 5% and 20% per
    year of the rand value of the investment fund(s) the money is invested in. This pension is paid by
    regularly cancelling units in the underlying investment funds. As already mentioned above, the
    investor signs an "Acknowledgement of Risks" declaration in the proposal form about risks he/she
    should be aware of. Intermediaries must take note of this and point it out to the client (investor).
•   The selected pension is deducted proportionally from all the chosen investment funds. The investor
    therefore cannot choose to have the pension paid out of only part of the total investment (out of one
    or more of the selected investment funds, for example).
•   The investor (previously the “member”) may adjust the pension annually. If investors wish to do so
    they must give written notice of the adjustment a month in advance. If necessary, the pension will be
    adjusted annually to ensure that it complies with the legal restrictions.
•   Pension installments are denominated in Rands, but can be converted to any currency so that they
    can be paid out anywhere in the world. This is possible because the investment itself is off-shore.
    The pension installment is gross of bank charges, currency charges and possible fees (the investor
    carries the cost of any conversions of payouts). Therefore, in addition to income tax, these charges
    and fees (if applicable) must also be deducted from the installment to determine the net installment.
•   The investor can request that the pension be a fixed US dollar amount, or a fixed rand amount. If,
    for example, the pension must be a fixed US dollar amount, but the pension is paid in rands, the
    rand equivalent will fluctuate from month to month in line with the exchange rate.
•   The full pension installment is taxable as income in the RSA. To calculate the income tax that
    Sanlam Life transfers to the South African Revenue Service (SARS), the pension in the foreign
    currency is converted to rands to determine the income tax in rands.
•   The pension can be paid monthly, in arrear only.
•   The pension payment can be grown automatically if it is specified as a rand or US dollar amount.

NUMBER OF INSUREDS

Only one life insured is permitted per policy (therefore the member at retirement, or the
dependants/beneficiaries upon death).




GE 8/2006                                        BX 49
APPOINTMENT OF BENEFICIARIES

One or more beneficiaries may be appointed to receive the pension after the death of the life insured.
The investor as policyholder may change such an appointment at any time. Sanlam Life must receive
the appointment, signed by the investor, before the investor's (life insured's) death.

The beneficiaries have the choice of taking out new Stratus International Investment Linked Pension
policies for life on their own lives, or receiving installments for five years (60 monthly pension
installments) in the form of a term annuity. However, if the beneficiary is a child, the term of the term
annuity is the greater of five years and the number of years until age 18.

PRIVATE PENSION

The Stratus International Investment Linked Pension is only available as a private pension. The investor
(member) is therefore the owner (policyholder) and life insured of the pension, subject to the stipulations
of the policy and legislation.

COOLING-OFF PERIOD

No cooling-off period applies. The pension may not be cancelled.

The policy may not be surrendered, pledged or ceded, and the benefits cannot be commuted.

POLICY DOCUMENTS

The investor as policyholder receives an investment certificate and a notice of acceptance letter.

TAX

Pension installments are taxed like normal income according to the prevailing income tax scales.




GE 8/2006                                         BX 50
    STRATUS COMPOSITE ANNUITY


DESCRIPTION

The Stratus Composite Annuity is a combination of a Stratus Investment Linked Pension and a
conventional guaranteed life annuity. A portion of the gross investment amount is invested in the
Stratus investment funds, while the remainder secures a guaranteed income. The investor chooses an
income from the investment funds, between 5% and 20% a year. This income is added to the
guaranteed income and a single income payment is made.

The Stratus Composite Annuity therefore offers:
    •   investments in investment funds, with possible investment growth;
    •   a variable income of between 5% and 20% a year of the value of the investment funds; and
    •   a guaranteed income.

Full commission is paid on the total gross investment amount. Therefore the life annuity rates used to
calculate the guaranteed income exclude the effect of commission. Please note that, as with all policies,
Sanlam Life is the owner of the underlying assets of the Stratus Composite Annuity. The Stratus
Composite Annuity is suited to fund members who are retiring and need a guaranteed income, but also
want a degree of investment growth and capital retention. The policy combines the investment
possibilities of an investment-linked life annuity (living annuity) with the mortality protection of a
traditional, guaranteed life annuity.

ADVANTAGES OF THE PRODUCT

•   The investment funds offer fund members as investors the flexibility and range of investment choices
    that are usually available for Stratus.
•   For most clients, a cautious approach to the level of the variable income, together with conservative,
    moderate risk investment funds, provides an opportunity for potentially good returns while the
    variable income is being paid.
•   At death, the remaining capital in the investment portfolio is available as the death benefit for the
    investor’s nominees. No death benefit is payable in respect of the guaranteed income if death occurs
    outside the term certain.
•   The level of the variable income is flexible, and over time can change to suit the investor’s needs
    (the variable income can be adjusted each year within the 5% and 20% limits – this does not apply
    to the guaranteed income).
•   The investor has full control over the choice of investment funds in respect of his or her retirement
    capital. This enables him or her to choose the investment funds of the Stratus range that suits his or
    her risk profile. It is important that a diversified portfolio should be chosen that suits the investor’s
    risk profile.
•   A suitable choice of investment funds should ensure the protection of the variable income against
    the erosive effect of inflation.
•   The investor can switch between available investment funds to suit his or her changing risk profile.
•   The guaranteed income is guaranteed for life.
•   If a growth rate is chosen for the guaranteed income, the growth rate is fixed and the growth in the
    income is also guaranteed.

DISADVANTAGES OF THE PRODUCT

The Stratus Composite Annuity provides a guarantee on the Guaranteed Income only (if selected) and
no guarantees on the variable income. The investor shall be exposed to investment and longevity risks
for the Variable Income portion. These include:

•   The risk that the value of investments may drop and/or the return on investments may be lower than
    expected; and
•   The risk that the investor may live longer than expected.




GE 8/2006                                          BX 51
DISADVANTAGES OF THE PRODUCT (continued)

If the investor chooses too high a level of income, he/she may deplete his capital over time. If the
Stratus Composite Annuity is the investor’s only source of income, Sanlam Life advises that the pre-tax
selected income should not exceed the medium term inflation outlook plus 2% per annum of the capital.
Currently that means a rate of not more than 8% per annum. If an income of more than 8% is required
to sustain the investor’s lifestyle, he/she should consider a different type of pension. The investor
should ensure that he/she understands the impact of market fluctuations on his/her future income. If the
total retirement capital is less than R1 million, the risks mentioned above are magnified and require
closer management from the investor.

Lifestyle and income requirements should be reviewed on an annual basis.

INITIAL TERM

•   The investment is open (open-ended) with no initial term. This provides capital retention because
    the amounts that are invested in the various funds are transferred to the nominees at the death of
    the investor.
•   The guaranteed income may have a term certain, which means that it will be paid at least for the
    chosen term certain, even if the investor dies before the end of the term certain. In the case of joint-
    life annuities, the guaranteed income will be paid until the death of the surviving life insured, but for
    at least the chosen term certain.

AVAILABLE INVESTMENT FUNDS

See section E(1).

SWITCHING BETWEEN INVESTMENT FUNDS

See section C(3).

INVESTMENT GUARANTEES

See section C(4).

PREMIUMS

Total minimum investment: R115 000.

The following further minimums also apply:

    In respect of the investment funds:
    •   Minimum: R100 000
    •   A minimum of R20 000 applies per investment funds (subject to the R100 000 mentioned above)
    In respect of the guaranteed income:
    The gross income must amount to at least R100 a month.

AGE AT ENTRY

The minimum and maximum ages at entry are as follows:

    Minimum : 20 anb
    Maximum : 86 anb




GE 8/2006                                          BX 52
DEATH BENEFIT

At the investor's death, the total value of the underlying investment funds will be available to the
nominees in the form of an investment linked annuity. Nominees also have the option to take an
accelerated annuity paid over a minimum period of 5 years. In the case of a minor, the minimum term
will be the greater of 5 years or the number of years to the age of 18. To the degree allowed in terms of
the law, the annuity can be commuted within 6 months of the investor's death. Such a lump sum will be
taxable at the investor's tax rate.

LIVES INSURED

The policy may have one or two lives insured. The second life insured is – where applicable – called the
"revocable nominee".

TRANSFER OF POLICY

The Stratus Composite Annuity may not be transferred to an annuity policy issued by another insurer,
nor converted to another type of annuity.

TAX

Pension installments are taxed like normal income according to the prevailing income tax scales.




GE 8/2006                                        BX 53
    STRATUS WITH PRESERVATION FUNDS


DESCRIPTION

•   A preservation fund is a pension or provident fund, which has been registered with Registrar of
    Pension funds and approved by the SARS.
•   It is a fund in which employees, who leave the service of a participating employer owing to dismissal
    (including retrenchment) or resignation, or in the event of the dissolution of the employer’s pension
    or provident fund, may invest their accrued fund benefits.
•   A member’s accrued benefit in a specific provident or pension fund may not be transferred to more
    than one preservation fund, but the benefits may be divided between a preservation fund and an RA
    fund.
•   The following are retained (preserved) in a preservation fund until retirement:
    −   Accrued retirement benefits
    −   Completed years of service
    −   The tax-free pre-1 March 1998 portion with the Wealth Protector Preservation Pension and
        Provident Funds

    Sanlam Life's Preservation Funds

    Sanlam Life administers the following preservation funds that make use of the Stratus product range
    that fund members’ benefits by means of policies on the lives of members:
    •   The Sanlam Preservation Pension Fund (hereafter called “the Fund”)
    •   The Sanlam Preservation Provident Fund (hereafter called “the Fund”)
    •   The Wealth Protector Preservation Pension Fund (for employees of local authorities
        only)(hereafter called "the Fund" unless otherwise indicated) and
    •   The Wealth Protector Preservation Provident Fund (for employees of local authorities only)
        (hereafter called "the Fund" unless otherwise indicated)

    Sanlam Personal Portfolios (SP2 ) administers the following:
    •   The Personal Portfolio Preservation Pension Fund and
    •   The Personal Portfolio Preservation Provident Fund.

    Note: The information that follows applies only to the Sanlam Preservation Pension Fund, the
          Sanlam Preservation Provident Fund, the Wealth Protector Preservation Pension Fund and
          the Wealth Protector Preservation Provident Fund regarding Stratus policies. Information on
          the preservation funds of Sanlam Personal Portfolios must be obtained from them.

    Working of a preservation fund

    •   The Fund takes out a single-premium policy with Sanlam Life on the life of the member in order
        to fund the benefits that the Fund must pay to the member. The Fund (and not the member) is
        the owner of the policy.
    •   The Fund pays the benefits to the member (at withdrawal, disability or retirement), or to the
        member’s dependants and/or nominees (at death).
    •   Tax concessions as in the case of pension and provident funds are applicable to retirement and
        death benefits. The concessions applicable to retirement benefits also apply in the case of early
        retirement owing to disability.
    •   Transfers from the local authorities retirement funds (excluding the government pension fund) to
        a preservation fund are now possible (Up to May 2003, such transfers were not permitted by
        Sanlam Life, because the member would forfeit the tax-free status of his transfer benefit.) For
        this purpose, the Wealth Protector Preservation Pension Fund and the Wealth Protector
        Preservation Provident Fund were established. These are funds established by law (paragraph
        (a) funds). The operation of these preservation funds is identical to that of the Sanlam
        Preservation Funds, except the tax aspects.
    •   Where there is further reference in this section to the Sanlam Preservation Pension Fund or the
        Sanlam Preservation Provident Fund, the information also applies to the Wealth Protector
        Preservation Pension Fund and the Wealth Protector Preservation Provident Fund respectively –
        except where otherwise indicated.




GE 8/2006                                         BX 54
ALLOWABLE TRANSFERS

•   Only transfers from an employer’s pension fund or another preservation pension fund to the Sanlam
    Preservation Pension Fund for Stratus policies are allowed.
•   Similarly only transfers from an employer’s provident fund or another preservation provident fund to
    the Sanlam Preservation Provident Fund for Stratus policies will be accepted.
•   Only transfers from employee pension funds or employee provident funds of local authorities are
    permitted to the Wealth Protector Preservation Pension Fund or the Wealth Protector Preservation
    Provident Fund respectively.
•   Benefits from a pension or provident fund may be transferred only when
    −   an employee leaves the service of a participating employer owing to resignation, dismissal or
        retrenchment, or when
    −   the pension or provident fund is dissolved completely.
•   The member’s gross benefits in the transferring fund must be transferred to the preservation fund,
    except if the benefits have been reduced as a result of:
    −   the provisions of Section 37D of the Pension Funds Act, e.g. a housing loan granted to the
        member by the transferring fund;
    −   the member transfers a portion to an RA fund; or
    −   the payment of a portion to a non-member in terms of a divorce order.

    A transfer to a preservation fund is prohibited if the gross benefits have been reduced for a reason
    other than those mentioned above.

•   A transfer from a preservation fund to an RA fund is not allowed.
•   Employees whose retirement provision structure changes from a pension fund to a provident fund
    will not be able to transfer accrued pension benefits to a preservation pension fund in the event of
    such restructuring, except if the pension fund in question is dissolved completely.
•   A transfer between two preservation pension funds or two preservation provident funds respectively
    is allowed only if the employer of the member concerned is a participating employer in respect of the
    receiving preservation pension fund or preservation provident fund.
•   Sometimes after funds have already been transferred, surplus money or interest out of the same
    pension or provident fund (therefore the same transferring fund) becomes available for a
    Preservation fund member.     Such additional single premiums must be added to existing
    Preservation fund policies.
•   The taxability of money resulting from contributions made prior to 1 March 1998 and those made
    after 1 March 1998 differ for members of pension or provident funds at local authorities. However,
    members can transfer their entire accrued retirement benefit (before and after 1 March 1998) to the
    Wealth Protector Preservation Funds. Only one policy will be issued. The transferring Fund must
    clearly indicate the tax-free portion (in respect of contributions prior to 1 March 1998) on the transfer
    form. This tax-free portion will be forfeited if the policy investment is transferred from the Wealth
    Protector Preservation Funds to a fund that is not established by law (paragraph (a) fund).
•   Transfers from an RA Fund to a preservation fund is not possible as RA funds have no participating
    employers in terms of their fund rules. Likewise will no transfers be allowed to a preservation fund
    from any unapproved fund (funds not approved by the SARS). This disqualifies transfers to a
    preservation fund from a foreign retirement fund.

INITIAL TERM

The planned date on which the member will retire from his or her new employer determines the
retirement date of the member in the Sanlam Preservation Pension Fund, the Sanlam Preservation
Provident Fund, the Wealth Protector Preservation Pension Fund or the Wealth Protector Preservation
Provident Fund. A member who is not employed with an employer can choose a retirement date that
falls on a date after the member reaches age 55 and before age 70. The period from the inception date
up to and including the retirement date is called the initial term.

An exception applies if the investment is made in an investment fund for which an investment guarantee
was chosen or the Vesting Bonus Fund. Such proposals will always be issued with a planned
retirement age of 55 actual age, except where the initial term is shorter than the minimum investment
term for guarantee funds (at present five years). For proposals with other planned retirement ages,
there is therefore an issuing requirement to adjust the proposal to one with a planned retirement age of
55 actual age, or a retirement date five years after the inception date (whichever is the earliest
permissible retirement date).



GE 8/2006                                          BX 55
INITIAL TERM (continued)

Proposals without investment guarantees can be issued with planned retirement ages between 55 and
70 actual birthdays.

After the expiry of the initial term, the term is open ended. This means that the policy is not paid out
automatically after the expiry of the initial term, but that the policy continues until the member notifies
Sanlam Life that he/she retires from his/her employer and that the policy must be terminated. In the
case of a member who is not employed with an employer, the policy is also continued until the member
informs Sanlam Life that he wishes to retire from the Fund. However, the retirement date must be before
the member's 70th birthday.

The minimum initial term is one year. However, if the policy is invested in an investment fund to which
an investment guarantee applies, or if the policy is invested in the Vesting Bonus Fund, the minimum
term is 5 years.

THE OPTION DATE

The date at the end of the initial term is the option date.

ENDOWMENT OPTION FOR PRESERVATION FUNDS

See section C(5).

AVAILABLE INVESTMENT FUNDS

See section E(1).

SWITCHING BETWEEN INVESTMENT FUNDS

See section C(3).

STRATUS LIFE TIME INVESTMENT OPTION

See section C(6).

INVESTMENT GUARANTEES

See section C(4).

THE INVESTMENT GUARANTEE DATE

•   If an investment guarantee is chosen, the policy has at least one investment guarantee date.
•   The first investment guarantee date is determined as follows:
    −   If the option date is later than 15 years after inception date, the first investment guarantee date is
        10 years after inception date. Further investment guarantee dates depend on the remaining initial
        term. See section C (4) for a further explanation of these dates.
    −   If the option date is 15 years or less after the inception date, there is only one investment
        guarantee date and is it the same as the option date.

PREMIUMS

•   Only single premiums are allowed.
•   The minimum single premium is R5 000.

INCEPTION DATE

The inception date of the policy is the date on which the single premium is received.




GE 8/2006                                           BX 56
AGE AT ENTRY AND RETIREMENT

Minimum age at entry            :   15 next birthday
Maximum age at entry            :   the day before the member’s 70th birthday, less the minimum term
Minimum age at retirement       :   56 next birthday
Maximum age ate retirement      :   the day before the member’s 70th birthday

If a member retires from an employer (or future employer) owing to his having reached retirement age or
owing to disability, he must also retire from the relevant preservation fund.

RIDER BENEFITS

No rider benefits are available.

LIFE COVER AND DISABILITY BENEFITS

No life cover or disability benefits are available.

DEATH BENEFIT

If no investment guarantee was chosen

The sum to which the value of the policy investment has grown at the date on which Sanlam Life
receives notice of the death of the member will be available for the benefit of the member’s dependants
and/or nominees, as set out in the Rules of the Fund. The value of the policy investment is not
guaranteed.

If an investment guarantee was chosen

The sum to which the value of the policy investment has grown at the date on which Sanlam Life
receives notice of the death of the member will be available for the benefit of the member’s dependants
and/or nominees, as set out in the Rules of the Fund. A minimum investment rate of return is
guaranteed on the value of the policy investment in the investment funds for which an investment
guarantee was chosen.

RETIREMENT BENEFIT

The member may choose to receive the retirement benefit at any time from his or her 55th and before his
or her 70th birthdays. The option date of a policy corresponds with the member’s proposed retirement
date. The member may choose to receive the retirement benefit before the option date, provided that
he/she is at least 55 years old. The member will then receive an early retirement benefit.

If the member retires from an employer after he/she joined the Fund, he/she must also retire from the
Fund, even if he/she is not 55 years old at the time. The member must notify Sanlam Life on behalf of
the Fund when he/she retires from employment.

If the member does not retire on the option date and is still employed by an employer, the policy will not
end. Sanlam Life will continue the investment for further capital growth in the investment fund(s) in
which it is invested at that stage.

The sum to which the value of the policy investment has grown will be available at retirement. If the
member receives the retirement benefit before the option date, an alteration fee will be charged.

In the case of the Sanlam Preservation Pension Fund and the Wealth Protector Preservation Pension
Fund, Sanlam Life may pay up to one third of the available amount as a lump sum to the member. The
balance must be used to provide the member with regular pension payments. Or, depending on the
member’s choice, the available amount may be used in full to provide the member with regular pension
payments. If the available amount is taken, the policy will end.

Upon retirement from the Sanlam Preservation Provident Fund and the Wealth Protector Preservation
Provident Fund, the member may take the full available amount as a lump sum, or it can be used to
provide the member with regular pension payments. If the available amount is taken, the policy will end.




GE 8/2006                                             BX 57
WITHDRAWAL FROM PRESERVATION FUNDS

•   The rules of a preservation fund allow members (employees) to withdraw from the fund at any stage
    before the chosen retirement age if the rules of the transferring fund do not prohibit this. The
    provisions of the contract indicate whether or not withdrawal is permitted on a relevant policy.
•   In the case of a withdrawal, the accrued benefit from a preservation fund may be taken in full in cash
    (as in the case of resignation from an ordinary pension or provident fund), after deduction of tax (if
    applicable). It is not deemed as a retirement.
•   Should a withdrawal or a partial withdrawal be made from a Wealth Protector Preservation Pension
    or Provident Fund, the tax-free money (prior to 1 March 1998) will be withdrawn first. Any growth on
    the tax-free portion will be taxable in the member's hands as soon as a withdrawal has been made,
    or when he or she retires.
•   Upon withdrawal from a preservation fund, and depending on the instructions of the member, the
    Fund will:
    −   pay the value of the policy to the member (after deduction of tax), or
    −   cede the policy to the member (after deduction of tax), or
    −   pay the value to another preservation fund if the member’s current employer is a participating
        employer in the Fund, or
    −   pay the value to the approved Fund (pension/provident fund) in which his new employer
        participates if he is a member of the new Fund.
•   However, if the member retires from an employer earlier in terms of another pension or provident
    fund, he has to retire from the preservation fund at the same time. It is then not deemed a
    resignation and the normal rules for retirement from the Fund will apply.

WITHDRAWAL BENEFIT

The rules of the transferring fund determine the extent to which the benefit amount may be withdrawn (if
at all) before the chosen retirement age. The rules often stipulates that, before the chosen retirement
age, the member may withdraw only that portion of the withdrawal benefit that arises from his or her own
contributions to the transferring fund, while that portion of the withdrawal benefit arising from the
employer’s contributions may usually not be withdrawn by the member before the chosen retirement
age.

If the member has made one withdrawal, he/she will not be allowed to do so again before the
normal retirement age, or disability or death.

If only part of the benefit may be withdrawn, the following will apply:

•   Minimum partial withdrawal allowed        :  R1 800
•   Maximum partial withdrawal allowed        :  Preservation pension fund
                                                 The total cash value less R2 500,00
                                              : Preservation provident fund
                                                 The total cash value less R2 500,00
If less than the above-mentioned amount remains after a partial withdrawal, the full value of the policy
must be taken, if allowed by the transferring Fund.

LOANS

No loans are allowed.




GE 8/2006                                           BX 58
ADDITIONAL SINGLE PREMIUMS

Sometimes, after funds have already been transferred, surplus money or interest from the same pension
or provident fund (therefore the same transferring Fund) becomes available for a Preservation fund
member. Such additional single premiums must be added to existing Preservation fund policies.

Sanlam Life requires the following:

•       The money must come from the same pension or provident fund as the original single premium.
•       Proof of the money (the Fund transfer form) is required, or written confirmation from the transferring
        Fund that the money is in fact going to be transferred.

Minimum ad hoc single premium

No minimum.

Existing policy already terminated

If the existing Preservation fund policy has already been terminated, a blocked policy is issued for the ad
hoc single premium. No cash withdrawal is therefore available on the new policy. If the ad hoc single
premium is less than the minimum premium for a new Preservation fund policy, Sanlam Life will pay the
member the surplus premium as a lump sum – after recovering any income tax (if any) by way of an
IRP3.

Partial withdrawal already made on existing policy

If the member has already made a partial withdrawal on the policy, no withdrawal benefit is available on
the new policy.

Already retired from the existing policy

If the member has already retired from the Preservation fund, the following occurs:

             Preservation Provident Fund                           Preservation Pension Fund
    •    If the full available benefit on the original    •   A new life annuity policy is purchased with the
         policy has already been paid to the member,          ad hoc-single premium. If the life annuity
         Sanlam Life will request an IRP3 and pay the         instalment is too small to meet Sanlam Life’s
         ad hoc single premium to the member.                 minimum requirements, the surplus amount –
    •    If, at retirement from the Preservation              after recovery of any income tax – will be paid
         provident fund, the member chose a lump              to the member in one amount.
         sum and the balance as pension, he or she
         can choose to take the surplus amount in
         cash, or to use it for a new life annuity,
         provided that the life annuity meets the
         minimum requirements for a life annuity
         instalment.

CONVERSIONS

In order to afford existing preservation fund members the opportunity to share in all the options offered
by an investment in Stratus, existing preservation fund policies issued before the end of April 2002 may
be converted to a Stratus policy in the Sanlam Preservation Pension Fund or Sanlam Preservation
Provident Fund.

CESSIONS

No cessions are allowed, apart from the outright cession to the member and the outright cession to the
Fund.




GE 8/2006                                             BX 59
APPOINTMENT OF NOMINEE(S) TO RECEIVE BENEFIT

•   Any number of nominees may be appointed, up to a maximum of 10.
•   By law, the Fund must pay the death benefit of a pension fund or provident fund policy as follows:
    −   to the member’s dependants, or
    −   if the member has nominated someone other than a dependant, to the member’s dependants
        and the nominated person or persons.
•   The member’s spouse, child (also a child who has reached maturity) and/or any person who, in law
    or in fact is dependent on the member for financial support or, a person who would have been
    dependent on the member had he or she lived, qualifies as dependant(s).
•   The Board of Trustees of the Fund will decide whether adequate provision was made for the needs
    of the member’s dependants. If a nominee is not a dependant, the Trustees of the Fund will decide
    whether, and to what extent, such a nominee will share the death benefit with the dependants.
•   The member may cancel or change the appointment of nominee(s). A notice to this effect, signed by
    the member, must reach Sanlam Life before the death of the member. Because people’s
    circumstances change from time to time, Sanlam Life recommends that the member should review
    the nomination regularly and notify Sanlam Life of any changes.
•   Unless a nominee accepts the nomination, that nominee will not receive the death benefit of the
    policy. However, the nomination may not be accepted before the death of the member.

TAX

•   No tax is payable on the transfer of retirement benefits to a preservation fund.
•   The tax payable by the member on the benefits that he/she receives from a preservation fund will be
    determined as in the case of an ordinary pension/provident fund:
    −   Lump sums (including policy values upon cession to the member) are taxable, but depending on
        the period of contributory membership, a portion may be tax-free upon retirement
    −   Pension payments are fully taxable as gross income.
•   The benefits which a member receive from the Wealth Protector Preservation Pension Fund or the
    Wealth Protector Preservation Provident Fund, and which arises from contributions made prior to 1
    March 1998, are tax free. For this purpose SARS form E is to be completed in addition to forms A
    and D at retirement, disability and death, or form B on withdrawal. However, benefits resulting from
    contributions made from 1 March 1998 will be taxed in the same way as policies in the Sanlam
    Preservation Pension Fund and the Sanlam Preservation Provident Fund.
•   Should money invested in the Wealth Protector Preservation Pension Fund or the Wealth Protector
    Preservation Provident Fund be transferred to another approved Fund at a later stage, all benefits
    will be fully taxable, irrespective of whether a portion was tax-free money, unless such a new fund is
    established by law i.e. a paragraph (a) fund.

YEARS OF SERVICE

The member’s years of service with the employer from whose pension or provident fund the transfer to
the preservation fund is made, are transferred to the relevant preservation fund. The member therefore
retains the portion of the accrued tax concession in respect of lump sums from pension and provident
funds. With transfers to the Wealth Protector Preservation Funds this tax concession is in addition to
the pre- 1 March 1998 tax-free portion.

However, the extent of this concession is determined by the member’s period of pensionable service
with the employer concerned, and for tax purposes he therefore does not accumulate years of service in
a preservation fund. However, if the member makes a withdrawal before retirement, or if part of the
transfer benefit is transferred from the transferring employer’s fund to an RA fund, the years of service
credit will be reduced pro rata, based on the amount withdrawn divided by the greater of the value
transferred to the preservation fund or the current fund value.




GE 8/2006                                          BX 60
    STRATUS WITH PRESERVATION PENSION FUNDS CONTINUATIONS AND
    STRATUS WITH PRESERVATION PROVIDENT FUNDS CONTINUATIONS

DESCRIPTION

It is possible to continue – as Stratus policies – preservation fund policies that have reached their
maturity date after being issued on the old administration system. Thus, these policies can share in all
the benefits that a Stratus investment offers, for example that an investment can be made in more than
one investment fund, transparency, etc.

Products available

•   Stratus Preservation Provident Fund
•   Stratus Preservation Pension Fund

Please note that the above are product names, and that there are still only four preservation
funds with Sanlam that are registered with the authorities, of which only the Sanlam
Preservation Provident Fund and the Sanlam Preservation Pension Fund may accept most
transfers. The two Wealth Protector Preservation Funds are exclusively for members who
transferred from certain Local Authorities Pension or Provident Funds.

INITIAL TERM

No term is involved. The policy continues until the member retires, dies or withdraws from the Fund.

ENDOWMENT OPTION WITH PRESERVATION FUND POLICIES

See section C(5).

AVAILABLE INVESTMENT FUNDS

See section E(1).

SWITCHING BETWEEN INVESTMENT FUNDS

See section C(3).

INVESTMENT GUARANTEES

See section C(4).

THE INVESTMENT GUARANTEE DATE

•   If an investment guarantee is chosen, the policy has one investment guarantee date.
•   The investment guarantee date is five years after the continuation date, except if the date five years
    after the continuation date is after the member's 70th birthday. In the latter instance the investment
    guarantee date is the member's 70th birthday.

CONTRIBUTIONS

The continuation amount is used as a single contribution on the policy. Minimum R5 000.

INCEPTION DATE

The inception date (continuation date) is the same as the date on which the existing policy matures.




GE 8/2006                                         BX 61
AGE AT ENTRY AND RETIREMENT

The minimum and maximum ages at entry and retirement are as follows:

•   Minimum age at entry              :   On old policy maturity date, age 55 at least
•   Maximum age at entry              :   the day before the member's 70th birthday, less minimum term
•   Minimum age at retirement         :   the member's 55th birthday
                                                                          th
•   Maximum age at retirement         :   the day before the member’s 70 birthday

If a member retires from an employer (or future employer) owing to his having reached retirement age or
owing to disability, he must also retire from the relevant preservation fund.

RIDER BENEFITS

No rider benefits are available.

LIFE COVER AND DISABILITY BENEFITS

No life cover or disability benefits are available.

DEATH BENEFIT

At the death of the member, the value to which the policy investment has grown, as on the date on
which Sanlam Life has received notice of the member's death, will be available for the benefit of the
member's dependants and/or nominees, as set out in the Rules of the Fund. If the fund with an
investment guarantee was chosen, a minimum net investment rate of return is guaranteed on the value
of the policy investment in the investment funds for which an investment guarantee was chosen.

RETIREMENT BENEFIT

The retirement benefit can be taken at any time from age 55 up to and including the day before the
member’s 70th birthday. If the member retires from an employer after he/she joined the Fund, he/she
must also retire from the Fund. The member must notify Sanlam Life on behalf of the Fund when
he/she retires from employment.

The sum to which the value of the policy investment has grown will be available at retirement. Currently
no termination fee is charged. Sanlam Life may, however, at any stage decide to charge a termination
fee.

One reason for the charge of a termination fee could be that the properties in the Worldwide Property
Fund (if applicable) might not be easily marketable at the stage of early retirement. (Please note: The
Worldwide Property Fund is currently not available for new business.)

In the case of the Sanlam Preservation Pension Fund and the Wealth Protector Preservation Pension
Fund, Sanlam Life may pay up to one third of the available amount as a lump sum to the member. The
balance must be used to provide the member with regular pension payments. Or, depending on the
member’s choice, the available amount may be used in full to provide the member with regular pension
payments. If the available amount is taken, the policy will end.

Upon retirement from the Sanlam Preservation Provident Fund and the Wealth Protector Preservation
Provident Fund, the member may take the full available amount as a lump sum, or it can be used to
provide the member with regular pension payments. If the available amount is taken, the policy will end.
The member can also apply for the policy to be ceded to him or her, on conditions as determined by the
Fund.




GE 8/2006                                             BX 62
WITHDRAWAL OUT OF A PRESERVATION FUND

•   The rules of a preservation fund allow members (employees) to withdraw from the fund at any stage
    before the chosen retirement age if the rules of the transferring fund do not prohibit this. The
    provisions of the contract indicate whether or not withdrawal is permitted on a relevant policy.
•   In the case of a withdrawal, the accrued benefit from a preservation fund may be taken in full in cash
    (as in the case of resignation from an ordinary pension or provident fund), after deduction of tax (if
    applicable). It is not deemed as a retirement.
•   Should a withdrawal or a partial withdrawal be made from a Wealth Protector Preservation Pension
    or Provident Fund, the tax-free money (prior to 1 March 1998) will be withdrawn first. Any growth on
    the tax-free portion will be taxable in the member's hands as soon as a withdrawal has been made,
    or when he or she retires.
•   Upon withdrawal from a preservation fund, and depending on the instructions of the member, the
    Fund will:
    −   pay the value of the policy to the member (after deduction of tax), or
    −   cede the policy to the member (after deduction of tax), or
    −   pay the value to another preservation fund if the member’s current employer is a participating
        employer in the Fund, or
    −   pay the value to the approved Fund (pension/provident fund) in which his new employer
        participates if he is a member of the new Fund.
•   However, if the member retires from an employer earlier in terms of another pension or provident
    fund, he has to retire from the preservation fund at the same time. It is then not deemed a
    resignation and the normal rules for retirement from the Fund will apply

WITHDRAWAL BENEFIT

The rules of the transferring fund determine the extent to which the benefit amount may be withdrawn (if
at all) before the chosen retirement age. The rules often stipulates that, before the chosen retirement
age, the member may withdraw only that portion of the withdrawal benefit that arises from his or her own
contributions to the transferring fund, while that portion of the withdrawal benefit arising from the
employer’s contributions may not be withdrawn by the member before the chosen retirement age.

If the member has made one withdrawal, he/she will not be allowed to do so again before the
normal retirement age, or disability or death.

The total withdrawal value is determined by Sanlam Life, but if only part of the benefit may be
withdrawn, the following will apply:

•   Minimum partial withdrawal allowed        :   R1 800
•   Maximum partial withdrawal allowed        :   Preservation pension fund
                                                  The total cash value less R2 500,00
                                              :   Preservation provident fund
                                                  The total cash value less R2 500,00

If less than the above-mentioned amount remains after a partial withdrawal, the full value of the policy
must be taken, if allowed by the transferring Fund.

LOANS

No loans are allowed.

TAX

The policy is not subject to CGT, because paragraph 55(d) of the 8th Schedule of the Income Tax Act
exempts it from CGT.




GE 8/2006                                          BX 63
    STRATUS ENDOWMENT FOR PROVIDENT FUNDS


FUNCTION OF A PROVIDENT FUND

With a provident fund, the employer can secure (additional) retirement provision for his employees.
Therefore, with the Central Provident Fund, the employer can offer a more competitive and flexible
remuneration package to his employees.

DESCRIPTION

The Stratus Endowment for Provident Funds is a policy used by the Central Provident Fund to finance
the benefits that it has to pay to its members.

With Stratus, Sanlam Life strives to offer transparent, good value for money products to its clients. After
the recovery of certain costs, Sanlam Life purchases units to the member’s advantage with the net
investment.

The member chooses that the investment should be invested in one or more of the available investment
funds (a maximum of 10 funds may be chosen) in a no-risk policy (without cover).

The member may switch between the available funds at any time.

WORKING OF THE CENTRAL PROVIDENT FUND

The Central Provident Fund was established as an umbrella fund. Employers can affiliate with the
Central Provident Fund. For each member of the fund (employee), an endowment policy (Stratus
Endowment for Provident Funds) is taken out at Sanlam Life.

Sanlam Personal Finance : Fund Administration administers the fund.

REGISTRATION

Before any policy in respect of an employer’s employee will be accepted and processed, the employer
must be registered with Personal Finance : Fund Administration as a participating employer of the
Central Provident Fund.

It is compulsory for employers to provide the information below in the application forms:

•   It is essential for every participating employer to appoint an authorised person. This person will
    negotiate with the Fund on behalf of the employer.
•   The Rules of the Fund stipulate that an employer must determine categories of employees. A
    minimum of one and a maximum of five categories is/are allowed. It is compulsory for all members
    in the chosen categories to participate in the Fund.

In their applications, employers undertake to:

•   notify the Central Provident Fund of employees in respect of whom they have to make contributions;
•   transfer contributions (premiums) according to the rules of the Fund within seven days of the date on
    which they become due to Sanlam Life;
•   comply with the rules of the Central Provident Fund.




GE 8/2006                                         BX 64
REGISTRATION FORMS

The following forms that were filed under the heading Central Provident Fund on the Sanlam Database
as well as the Brokers’ and Advisers’ Web, must be completed in order to register such a scheme:

•   Form CPF0001E: Application by an institution for participation in the Central Provident Fund
•   Form CPF0001F5E: Alteration of authorised person

Fund Administration will register the scheme and allocate a registration number.

The authorised person at the Employer involved will be informed in writing when the scheme has been
registered.

The letter will also include:
•   an informational brochure for the participating employer and member/members, which will inform
    them how the scheme works, the requirements and the benefits that the Fund offers;
•   a copy of the original policy between the Fund and Sanlam Life Insurance Ltd.;
•   a copy of the Rules of the Fund.

The purpose of this is to ensure that both the participating employer and his employee(s) that participate
in the Scheme are well informed.

It is also important for the designated authorised person to be familiar with the content of the above-
named documentation.

MEMBERSHIP

•   Employees in the service of the employer on the date on which the employer started participating in
    the Fund and who qualify for membership, have the choice of becoming a member of the fund during
    the first year from that date.
•   After the first fund anniversary, such members may no longer become members.
•   All employees entering the service of the employer after the date on which the employer started
    participating in the Fund and who do qualify for membership are compelled to participate in the fund.
•   An employee who initially did not qualify for participation because he did not fall under one of the
    categories specified by the employer, is compelled to participate in the fund if, at a later stage, he
    does fall within one of the categories owing to promotion, salary increase, etc.
•   The employer himself determines the categories of employees qualifying for membership.
•   Employers may determine more than one category of qualifying employees; for instance, according
    to income groups. A maximum of 5 categories are allowed.
•   The category definition and remuneration are filled in on form 2 of the proposal form CPF0001E.
•   The employer must pay the current contribution for each participating member of the fund. The
    contribution is recovered from the employee’s remuneration according to the selected fixed
    contribution level.
•   To initially become a member of the fund (i.e. entry to the fund) the employee must:
    − be in the full-time service of a participating employer;
    − fall within one of the categories specified for participation.
    The employer must at least pay the minimum fixed contribution level of the prescribed contribution
    levels.

LIFE INSURED

The employee (member) is the life insured. Only one life insured will be allowed on the savings product.




GE 8/2006                                         BX 65
POLICY-OWNER

The Central Provident Fund is the owner of the policy. Employees (members) therefore may not deal
with it until they, for some or other reason (resignation, for instance) take over ownership.

INITIAL TERM

•   The policy has an initial term and after that it is open-ended.
•   The initial term ends on the member’s 55th birthday, subject to a minimum initial term of 5 years, and
    to the longest minimum term prescribed by the chosen investment fund(s).
•   In the case of conversions, the initial term ends on at least the maturity date of the policy that is
    being converted if the period from conversion date up to the member’s 55th birthday does not
    comply with the minimum initial term, as explained above.
•   After expiry of the initial term, the term is open-ended. This means that the policy will not be paid out
    automatically when the initial term has expired, but that the policy will continue until the member or
    the employer notifies Sanlam Life that the policy should be terminated, or until the death of the life
    insured – whichever happens first.

THE OPTION DATE

The date at the end of the initial term is the option date.

After the option date, the policy will continue automatically if the member or the employer does not notify
Sanlam Life that the available retirement benefit must be paid out. The policy can continue with or
without further premium payments.

RETIREMENT BENEFIT AVAILABLE ON THE OPTION DATE

The amount to which the policy investment has grown will be available on the option date. Should the
member retire and take the available amount, the policy will be terminated.

If no investment guarantee has been chosen, the value of the policy investment will not be guaranteed.
Should the member, in the case of an investment fund where such guarantee is available, choose an
investment guarantee, a minimum rate of return will be guaranteed on the investment in each
investment fund for which an investment guarantee has been chosen.

A member’s retirement benefit is a pension that is purchased with the value of the policy on his life. The
member can request that part of the pension (or the entire pension) be converted to a lump sum
payment.

If the member does not retire on the option date, the policy may not be terminated and the employer
must continue with contributions. And, except where the member or the employer notifies us otherwise,
we will continue the policy in the investment fund(s) in which it is invested at that stage.

At present, no alteration fee is applicable if the member retires after the the option date. Sanlam Life
may change this at any time.

The member must inform Sanlam Life of his retirement date before he retires. Sanlam Life will then
send the member the necessary forms to be completed and returned to Sanlam Life.

AVAILABLE INVESTMENT FUNDS

See section E(1).

SWITCHING BETWEEN INVESTMENT FUNDS

See section C(3).

STRATUS LIFETIME INVESTMENT OPTION

See section C(6).




GE 8/2006                                           BX 66
INVESTMENT GUARANTEES

See section C(4).

THE INVESTMENT GUARANTEE DATE

•   If an investment guarantee has been chosen, the policy has at least one investment guarantee date.
•   The first investment guarantee date is determined as follows:
    −   If the option date is later than 15 years after inception date, the first investment guarantee date is
        10 years after inception date. Further investment guarantee dates depend on the remaining initial
        term. See section C (4) for a further explanation of these dates.
    −   If the option date is 15 years or less after the inception date, there is only one investment
        guarantee date and is it the same as the option date.

CONTRIBUTIONS TO THE FUND

The Fund will accept employer contributions only. Each employer selects from a table of contribution
levels, made available by the Fund, the contribution that he will make to the Fund in respect of each
employee.

Only recurring contributions, or a single contribution plus recurring contributions are allowed. Recurring
contributions can be payable only monthly or annually.

No single contribution on its own will be allowed. In the case of conversions, however, the transfer
value will be treated as a single contribution.

Recurring contributions can be paid by debit order only. No debit order discount applies. Contributions
are paid on the 1st of each month.

MONITORING OF CONTRIBUTIONS

The Act requires Sanlam Personal Finance to appoint a Monitoring person, who is responsible for the
following:

•   monitoring that contributions have been paid within the correct period;
•   monitoring that Sanlam Personal Finance : Fund Administration received the Contribution
    statements;
•   reporting all late/unpaid contributions to the specific role-players, as stipulated in the Regulations,
    namely:
       The Trustees of the Fund
       The Financial Services Board
       The South African Police Service

They must also report all interest that is owed on late, unpaid contributions, which the participating
employer has not paid to Fund Administration.




GE 8/2006                                           BX 67
The minimum contribution is as follows:

                                                                                       Increase
                                                         Single         Recurring         in
                                                        premium         premium1       recurring
                                                                                       premium
          Conversions
             Transfer value²:                            R2 500            n.a.           n.a.
          Single contribution (together with
          recurring contributions on the same            R2 500              -              -
          policy):
          Ad hoc single contributions ³:                 R2 500              -              -
          Stratus Endowment for Provident
          Funds:
              Monthly                                       -            R150,00        R 70,00
              Annually                                      -            R1 800         R840,00
          Stratus Premier Endowment for
          Provident Funds:
              Monthly                                       -            R255,00        R 70,00
              Annually                                      -            R3 060         R840,00

      1
           The minimum amount that may be invested per investment fund is R50,00.
      ²    This relates to the transfer value from the old (converted) policy.
      ³    Ad hoc single premiums are allowed only if required as such by the employer or when money is
           transferred from one fund to another, or when the member wishes to purchase years of service.

INCEPTION DATE

The inception date in the case of new business is determined by the contribution that is made, and is
as follows:

•   Recurring contributions
    −
                                              st
          The inception date is always the 1 day of the month. The day on which the first contribution is
          payable, is the inception date of the policy.
    −     Recurring contributions (in the case of conversions) must be chosen from inception date.

•   Initial amount/investment amount (single premium)
    Single contributions on their own are not allowed (except in the case of a conversion without
    premium payments). In such a case the date of conversion is the date on which the conversion
    comes into force. This date is always the 1st of the month.

•   Combination of single contributions and recurring contributions
    The recurring contribution, in accordance with the rules set out at “Recurring contributions” above,
    will determine the inception date.

NB:

The back-dating of recurring premium policies further than the beginning of a year of
assessment is not permissible. Back-dating of single premiums is not allowed.




GE 8/2006                                          BX 68
AGE AT ENTRY AND RETIREMENT

The minimum and maximum ages at entry and retirement are as follows:

•   Minimum age at entry              :   15 anb
•   Maximum age at entry              :   None
•   Minimum age at retirement         :   The member’s 55th birthday
•   Maximum age at retirement         :   None

PREMIUM GROWTH

•   Premium growth is compulsory.
•   Only Flexi growth is available.
•   Only one increase a year may take place.
•   The increase must be on the first day of the month (the same as the inception date of the policy).
    This applies to both monthly and annual frequencies.
•   A premium increase requested in terms of Flexi growth may not be cancelled.

RIDER BENEFITS

Rider benefits are not available.

LIFE COVER AND DISABILITY BENEFITS

Life cover and disability benefits are not available. In the case of conversions, if the policy being
converted makes provision for life cover and/or disability benefits, this cover and/or benefits will no
longer be applicable after the conversion.

DEATH BENEFIT

In the case of an employer who dies, the authorised person at the relevant Employer must inform the
Fund Administration department of the death of the employee by telephone/fax/e-mail.

The Fund Administration department will then in turn send a letter to the authorised person at the
Employer, who requires certain requirements and documentation in order to put the death claim in
motion. The authorised person must then return this letter to the Death Claims department at Sanlam
Life.

•   The fund value is payable to the dependant(s) and/or nominee(s) of the member at his or her death.
•   If the member chose the investment guarantee in the case of an investment fund where such a
    guarantee was available, the minimum return on the investment in each investment fund for which
    the investment guarantee was chosen is guaranteed.
•   The full return may be taken as a lump sum and/or the benefit can be used to purchase a pension
    for one or more of the nominees and/or dependants.
•   Apart from the tax-free contributions as stipulated by the Income Tax Act, any lump sum payment is
    subject to income tax.

APPOINTMENT OF NOMINEE TO RECEIVE THE DEATH BENEFIT

The member may appoint any person as nominee to receive the death benefit at death of the life
insured (member). In total, up to 10 nominees may be appointed. The appointment may be revoked or
changed at any time, provided this is done in writing.




GE 8/2006                                         BX 69
RETIREMENT

In the case of retirement the authorised person at the relevant Employer must inform the Fund
Administration department of the retirement by telephone/fax/e-mail.

The Fund Administration department will then in turn send an option (notification) letter to the authorised
person at the Employer, which the authorised person as well as the relevant employee must complete
and sign.

•   The retirement date is the date on which the member actually retires at the employer; or
•   In the case of a member who is not in the service of an employer, a date on which the member
    decides, which must fall either on or after the member’s 55th birthday, but on or before his 70th
    birthday, or the date on which the insurer pays the member disability benefits.
•   The fund value less a fee (if applicable) is payable.
•   The retirement benefit is a pension that is purchased with the value of the policy on a member’s life.
    At the member’s request part of the pension (or the entire pension) can be converted to a lump sum
    payment. The member can also take cession of the policy in stead of a lump sum payment.
•   The member pays income tax at his/her average tax rate after the tax-free amount for which the
    member qualifies has been taken into calculation.

    Please note the following with regard to cession of the policy:
    After the cession of the policy has been taken at retirement, the member (now policyholder) can
    continue with contributions, which are no longer tax deductible, or stop contributions and have the
    policy made fully paid-up. The member does not pay tax again when the policy is paid out to
    him/her.
•   Pension instalments will be taxed at the member's marginal tax rate.
Note:    The maturity date must preferably coincide with the envisaged retirement date.
         The member must retire from the Fund if he/she leaves the service of the employer.

RESIGNATION OR RETRENCHMENT

In the case of resignation/retrenchment the authorised person at the relevant Employer must inform the
Fund Administration department of the resignation/retrenchment by telephone/fax/e-mail.

The Fund Administration department will in turn send the authorised person at the Employer an option
letter again, which the authorised person as well as the relevant employee must complete and sign.

The options below are available at resignation or retrenchment:

•   If a member accepts a new job and the new employer is registered with the Central Provident Fund,
    the new employer can continue contributions for the member’s benefit. There is then no tax
    complication for the member.
•   The policy can be ceded to the member. The portion of the cession value of the policy that exceeds
    the tax-free amount will then be subject to income tax.
•   The Fund can surrender the policy. The cash value is paid to the member and the portion that
    exceeds the tax-free amount will then be subject to income tax.
•   The cash value of the policy can be transferred to another approved retirement fund. There are
    then no tax implications for the member.
•   The policy can be made fully paid-up and left in the Fund until the member’s actual retirement date.
    Tax will then be paid at retirement.
•   A tax-free income option is available at maturity.

LOANS

Loans are not allowed.




GE 8/2006                                          BX 70
MAKING PAID-UP

The policy can be made paid-up (VOP) at any stage if the member is no longer in the service of the
employer, subject to a minimum remaining fund value (currently R50).

Recurring premiums may not be added on a VOP policy.

CASH WITHDRAWAL

•   A cash withdrawal will be allowed when the member leaves the service of the employer owing to
    resignation or dismissal, or when the member dies.
•   The fund value less an alteration fee will be payable.
•   The full proceeds must be taken in a lump sum.
•   Over a certain amount, the lump sum will be taxable.
•   Partial cash withdrawals are not available.
•   Regular cash withdrawals are not allowed.

ALTERATIONS

No alterations can be done on these policies at present. Therefore no ad hoc premium increases or
decreases are allowed.

COOLING-OFF PERIOD

No cooling-off period is involved.




GE 8/2006                                          BX 71
GENERAL AND ADMINISTRATIVE INFORMATION

Dismissal,          Options available to the employer
Retirement,         •   For as long as the policy is an asset of the Central Provident Fund, the
Resignation             Central Provident Fund may surrender the policy at the request of the
                        employer, and the surrender value will be paid direct to the former
                        employee. (Tax implications: none for employer). The policy therefore
                        need not be ceded to the insured first, but may be surrendered directly by
                        the fund.
                    •  The policy is ceded to the employee. The employee may surrender it and
                       if 5 years of the policy term have expired already, Section 54 of the
                       Regulations to the Long-term Insurance Act (previously Section 59D) will
                       not limit the surrender value (see section AD).
                    Options available to the employee
                    •   A new employer may continue to pay premiums to the benefit of the
                        member, provided that he is also affiliated with the Central Provident
                        Fund. (Tax implications: none for the original employer or employee).
                    •   The policy may be surrendered (by the Central Provident Fund) prior to
                        retirement age. The tax-free lump sum is the larger of R1 800 and any
                        part of the benefit transferred to an approved pension fund, provident fund
                        or RA fund. Any balance is taxed at average rate.
                    •   If the policy is surrendered at reaching retirement date, the formula for the
                        calculation of the tax-free amount will be:
                             th
                        1/10 of the highest average annual salary (max. R60 000) over any 5
                        consecutive years of service x number of years of service (max. 50),
                        subject to a maximum of the larger of R120 000 and R4 500 x full number
                        of years of service plus contributions that were not allowed as deductions
                        in the past.
                    •   The portion of the lump sum exceeding the tax-free part will be taxed at
                        the taxpayer’s average rate.
                    •   Should a member wish to take a part of the benefit by way of a pension,
                        the full pension as such will be taxable.
                    •   The policy may be ceded to the employee. The underlying reason for the
                        cession (retirement or withdrawal as a result of resignation) will determine
                        the tax implications.
                    •   The surrender value of the policy will be deemed to be a lump-sum benefit
                        accruing to the member on the date of such a cession.
                    •   At retirement, the policy benefits can be paid out as a lump sum, or any
                        part of the proceeds can be used to purchase a pension.
Board decision/     •   A Board / member’s’ decision is essential in the case of a company/close
Members’ decision       corporation.
for joining as      •   An extract from the Minutes of a meeting (Form 3 of the proposal form
participating           CPF0001E) held by the Board/members must be completed and signed
employer                by each employer affiliated with the Central Provident Fund.




GE 8/2006                                   BX 72
One-man            The provident fund can be established as benefit for the sole shareholder, as well
companies          as all qualifying employees of such company. However, bear in mind that the
                   shareholder can only receive a retirement benefit if he/she really retires, and it
                   often happens that such persons never really retire.
Sole               The provident fund can indeed be used for one-man businesses, but only in
proprietorship     respect of employees who are in the service of the owner. The owner of the one-
                   man business cannot be an employee of himself.
Spouse             Only employees of the employer will qualify as members of the provident fund.
                   Spouses therefore can participate only when they are also employed by the
                   relevant employer.
Insolvency         •   For as long as an insolvent employee remains in the service of the employer,
                       or an insolvent employee is rehabilitated prior to receiving the provident fund
                       benefit, the insolvency of the employee will have no effect on the provident
                       fund, since the policy belongs to the Central Provident Fund.
                   •   The insolvency of the employer will have no direct influence on the provident
                       fund policy because the employer is not the owner of the policy. However,
                       those concerned must decide on the future of the policy. The payment of the
                       premiums by a new employer or cession to the member, for instance, can be
                       considered.
Buying back of     The employer can make retroactive contributions to the Fund in respect of the
years of service   member for any period prior to the commencement of the member’s membership.
                   The elapsed period for which the retroactive contribution is made, will be
                   calculated at the member’s retirement or death according to this formula:
                              A
                   Y    =     B     x C – C, where

                   Y    =     the period of elapsed service that has to be calculated;
                   A    =     the total contributions to the Fund in respect of the member (i.e.
                              current and retroactive contributions).
                   B    =     the current contributions to the Fund in respect of the member.
                   C    =     the years of contributory membership at retirement or death.
Partnerships       The provident fund cannot be used for the partners in a partnership. However, it
                   can be used for the employees of a partnership.
Selling of a       Membership of the Central Provident Fund can continue as in the past, provided
business           that the new owner has been registered or will be registered with the Central
                   Provident Fund as participating employer.
Continuations      If the actual retirement date is after the maturity date of the policy, the Fund must
within the Fund    continue with the policy until the actual retirement date.
Administration     •   The new employer continues to pay the premiums to the benefit of the
                       member
                       A notice of change of employer (AE1356), as well as the new employer's
                       registration number, signed and stamped by the new employer, must be
                       sent/faxed to Sanlam Head Office: Fund Administration, fax number (021)
                       957-1327 or send the form by e-mail to fundadministrationSL@sanlam.co.za.
                   •   Death claim
                       A death claim must be reported in writing or by telephone at Sanlam Life’s
                       Death Claims department, who will then ask for the necessary forms and
                       requirements. A death certificate at least will always be required.
                   Note: In order to speed up the finalisation of matters, the employee’s tax
                         particulars and a written declaration about what the situation is with
                         regard to the employee, will be needed at death, retirement, etc.




GE 8/2006                                     BX 73
Quotation forms     •   For conversions: AEB2049
                    •   For continuations: AEB2048
Application forms   •   Employer’s application: AEB2037
                        This application is to be completed by the employer for up to 22 employees.
                        This application form is valid for three months only.
                    •   Declaration by employee: AEB2036
                        Completed in respect of each employee.
                    •   Application form for conversions: AEB2046
                    •   Application form for continuations: AEB2047
Rules of the        The rules of the fund are available on "Notes" on SL "General Mail : Fund Rules".
Central Provident   It will be assumed that the participating employer who signed his application for
Fund                participation is familiar with the rules.
Enquiries           Technical          Enquiries can be directed to your local legal adviser or to
                    enquiries          Fund Administration – (021) 947-6506.
                    Registration of    – Procedure of registration: Fund Administration
                    your employer      – To determine whether a specific employer is registered:
                                         Fund Administration
                    Death benefits     – If the insured is still alive:
                                         Client Contact Centre
                                       – If the insured is deceased:
                                         Policy Claims : Policy Death Claims (Head Office)




GE 8/2006                                     BX 74
  STRATUS GUARANTEED INCOME


DESCRIPTION

Stratus Guaranteed Income is a lump-sum investment aimed at providing a monthly or annual income to
the client for the chosen term.

With the lump sum, Sanlam Life purchases a guaranteed income for the client for the chosen term. This
income can be payable monthly or annually.

The lump sum investment could be from a client's own sources or from the net after tax lump sum from
his/her retirement funds, but not from the compulsory two-thirds of his/her retirement fund benefit.

TERM

The minimum and maximum terms are as follows:
      Minimum : 5 years
      Maximum : 15 years

PREMIUMS

The minimum single premium that may be invested must be of such nature that the income provided by
it meets Sanlam Life’s minimum requirements (see “minimum income” below).

INCEPTION DATE

The date on which the initial amount is deposited at any contracted bank branch (at present those of
ABSA or First National Bank), determines the inception date. The inception date can be any day of the
month from the 2nd up to and including the 29th. Should the date of payment be the 1st, 30th or 31st of
a month, the inception date will be the 29th. If the date of payment is the 2nd up to and including the
  th
29 , the inception date is the same as the date of payment.

Examples:

    Date of payment                    Inception date
     1 December 2005                  29 November 2005
    15 December 2005                  15 December 2005
    31 December 2005                  29 December 2005

NB: Intermediaries must deposit clients' cheques as soon as possible (if applicable), as that
    date will determine the inception date.

AGE AT ENTRY

No minimum and maximum ages at entry will apply.

RATE DATE

The rates that are used to determine the income, are the rates that applied on the quotation date,
subject to it that the investment amount was deposited at a contracted bank branch within the validity
period.




GE 8/2006                                       BX 75
INCOME PAYABLE

Frequency

•   Monthy income
    Sanlam Life will pay the monthly income after each month. This payment is not necessarily at the
    end of a calendar month. For example, should the inception date of the Stratus Guaranteed Income
    be 6 December 2005, the first payment will be on 5 January 2006, and on the 5th day of each month
    after that. Should the term of the policy, in the example, be 5 years, the last payment will be on
    5 December 2010.

•   Annual income
    Sanlam Life will pay the annual income after each year. This payment, however, is not necessarily
    on the last day of a calendar month. For example, should the inception date be 6 December 2005,
    the first payment will be on 5 December 2006, and on 5 December each year after that. Should the
    term of the policy, in the example, be 5 years, the last payment will be on 5 December 2010.

Growth in income

The policyholder may choose to let the monthly or annual income grow at a pre-selected rate each year.
This rate can be any percentage from 5% up to and including 15% a year. The pre-selected growth rate
must always be a full percentage, for instance 7%, and not 7,5%. Sanlam Life guarantees the amount
of the income payments. If the income grows annually, Sanlam Life also guarantees the annual growth
on it.

Minimum income

The minimum initial income is as follows:
Monthly : R100,00 a month
Annually : R600,00 a year

If Stratus Guaranteed Income is part of a Stratus Guaranteed Investment, the minimum initial income is
as follows:
Monthly : R 165,00 a month
Annually : R2 200,00 a year

DEATH BENEFIT

At death of the policyholder

No death benefit will be payable at death of the policyholder. The policy will continue up to the end of
the policy term, unless the new owner surrenders it. Should the policyholder have appointed a nominee
for policy ownership, that nominee will become the new owner of the policy after the death of the
policyholder, provided that he/she accepts the nomination at that stage. Should there be no such
nomination at death of the policyholder, the policy will be an asset in the policyholder's estate.

At death of the annuitant

If the annuitant is a natural person, the remaining income payments, as on the date on which Sanlam
Life receives notice of the death, will be paid to the person(s) of the policyholder's choice.

FULL OR PARTIAL WITHDRAWAL

The policy may be surrendered. The total cash value of the policy is equal to the current value of the
remaining income payments, discounted at the current interest rate applicable to surrenders, less a
termination fee, at present R0,00. Sanlam Life may change this fee at any time and adjust it with the
inflation rate.

The normal policy restrictions in terms of Section 54 of the Long-term Insurance Act (previously Section
59D of the old Act) will apply to surrenders.

Partial surrenders may be done as well.

A portion of the surrender amount may be subject to income tax.



GE 8/2006                                        BX 76
LOANS

Loans are not permitted

BENEFICIARIES

No beneficiary can be appointed, because there is no life insured applicable.

NOMINEES FOR POLICY-OWNERSHIP

If the term annuitant and the policyholder are two different persons, and the term annuitant dies, the
policyholder becomes the new term annuitant. If the section 10A capital element exemption applied for
the annuitant until his death, it will continue, provided the new annuitant is the surviving spouse. If the
annuitant and the policyholder is the same person, he can appoint a nominee for policy ownership.

This nominee also becomes the new annuitant. The nominee can then decide to appoint someone else
as annuitant. If the section 10A capital element exemption applied for the original annuitant until his
death, it will continue, provided the new annuitant is the surviving spouse of the original annuitant.

CESSIONS

The Stratus Guaranteed Income may be ceded. Where the section 10A capital element exemption
applied prior to the cessions, the exemption will lapse due to the cession, unless one spouse cedes the
annuity to the other spouse.

TAX

Tax must be paid by the policyholder on the income. If the section 10A capital exemption applies, the
capital portion of the income is not taxable in the hands of the policyholder.




GE 8/2006                                         BX 77
    STRATUS GUARANTEED RETURN

DESCRIPTION

Stratus Guaranteed Return is a single premium investment with the aim to provide a guaranteed lump
sum after five or seven years (according to the client’s choice).

Sanlam Life invests the single premium and guarantees a maturity benefit amount at the end of the
term.

TERM

Terms of 5 years and 7 years are available

PREMIUMS

Stratus Guaranteed Return is a single premium investment product.

The minimum single premium is: R10 000

INCEPTION DATE

The date of payment is the date on which the single premium is paid in at any contracted-in bank branch
(currently of ABSA or First National Bank). It can be any day of the month up to and including the 31st.
The inception date is the first of the month that follows the date of payment, except if the payment date
is the first of the month. If the date of payment is the first of a month, the inception date is the same
date.

AGE AT ENTRY

No minimum and maximum ages at entry apply in the case of Stratus Guaranteed Return

RIDER BENEFITS

No rider benefits are available.

RATE DATE

The rate that are used to determine the guarantee is the rate that applied on the quotation date, subject
to it that the investment amount was deposited at a contracted bank branch within the validity period.

MATURITY BENEFIT

On the maturity date Sanlam Life will pay a guaranteed amount to the policyholder. Under certain
circumstances Sanlam Life may, however, reduce this amount.

The maturity benefit may be reduced if the government or authority:
•   increases the amount of tax or levies payable for the assets that Sanlam Life keeps for the policy
    concerned;
•   requires that these assets be invested in another way.

For example, in the case of an individual policyholder, the maturity benefit currently allows for tax of
7,5% on any capital gains on the underlying assets after 1 October 2001. Should the effective rate of
capital gains tax for long-term insurers be increased in future, the maturity benefit will be reduced
accordingly. It is important that intermediaries ensure policyholders understand this possible reduction
as such. Should such reduction be necessary, it cannot result in a tax deduction in the hands of the
policyholder to claim in the policyholder's tax return.

If the policyholder is non-taxable when the policy is taken out, Sanlam Life may also reduce the maturity
benefit if the policyholder’s tax status should change. This is because of the different rates of tax
Sanlam Life must pay in terms of section 29 of the Income Tax Act, 58 of 1962, in the different
policyholder's tax funds (namely the Individual Policyholder's Fund, the Company Policyholder's Fund
and the Untaxed Policyholder's Fund).




GE 8/2006                                        BX 78
DEATH BENEFIT

No death benefit is payable at the death of the policyholder (no life insured is involved). The policy will
continue up to maturity date, unless the new owner surrenders the policy. If the policyholder appointed
a nominee for policy-ownership, that nominee will become the owner of the policy after the death of the
policyholder, provided that the nominee accepts the nomination at that stage. If there is no such
nominee at the death of the policyholder, the policy will be an asset in the estate of the policyholder.

LOANS

No loans are allowed on these policies

ALTERATIONS

The policyholder may add an ad hoc single premium to the policy.

•    The outstanding policy term of the policy concerned must be at least two years.
•    The minimum ad hoc single premium allowed is R10 000.
•    As much as 20% more than the original single premium can be added.
           Example: Original single premium = R100 000
                     An ad hoc single premium of R10 000 to R120 000 can be added.
•    The guarantee rate applicable to additions, is determined in accordance with the date of addition.
     This rate can therefore differ from the original rate applicable when the policy was taken out

APPOINTING OF BENEFICIARIES TO RECEIVE DEATH BENEFITS

A beneficiary cannot be appointed to receive death benefits, because no life insured is involved.
Therefore there are no death benefits to go to a beneficiary.

APPOINTING OF NOMINEES FOR POLICY-OWNERSHIP

    At the death of the      If the nominee(s) accept the nomination for policy-ownership at the death of
    original policyholder    the original policyholder, that nominee or those nominees will become the
                             new policyholder(s) of the policy concerned.
    More than one            •   If more than one nominee were nominated for policy-ownership of a
    nominee nominated            policy, these nominees become the joint new policyholders of the policy
                                 concerned (provided they accept the nominations).
                             •   For any dealings with the policy, except the revocation/amendment of a
                                 policy-ownership nomination, all the new policyholders must reach
                                 consensus and sign for the deal (e.g. surrender, cession, etc.). A
                                 nomination for policy-ownership must be revocable to be contractually
                                 binding.
                             •   Sanlam Life will not carry out any instruction or request regarding the
                                 policy before the permission of all the policyholders concerned, has
                                 been obtained. Sanlam Life will not go to the trouble of obtaining the
                                 permission of each policyholder - the joint permission must accompany
                                 the request for any dealings with the policy.
                             •   If the policy is surrendered, it must be a full surrender, and every
                                 policyholder will then receive his/her portion of the surrender value.
                             •   No partial surrenders are allowed.




GE 8/2006                                         BX 79
    APPOINTING OF NOMINEES FOR POLICY-OWNERSHIP (continued)

    At the death of one of     •    After a nominee has accepted a nomination for policy-ownership, he
    the new policyholders           may nominate only one nominee for policy-ownership to become the
                                    new policyholder of his part of the policy at his death.
                               •    This policyholder can also not deal with the policy without the permission
                                    of all the other policyholders.
                               •    If the new policyholder dies without having nominated a nominee for
                                    policy-ownership, his part of the policy will be an asset in his estate. In
                                    this case the estate can only be finalised if the executor of the estate
                                    can reach consensus with the other owners for the policy to be
                                    surrendered.
    At maturity date           The guaranteed maturity value will be paid to the nominee(s) for ownership
                               on the maturity date. Should more than one nominee for policy-ownership
                               have been appointed (and there is thus now more than one policyholder at
                               maturity date), continuation of these policies will not be allowed.

CESSIONS

•     All the normal rules apply.
•     In the case of an outright cession the tax status of the new owner can change the tax status of the
      policy. This can bring about a change in the guaranteed maturity benefit

TAX

No tax is paid on the maturity proceeds as Sanlam Life pays the tax on the underlying investment. The
guaranteed amount may be reduced if a government or authority increases an amount of tax or levies or
requires that the policy assets be invested in another way. It is important that intermediaries ensure
policyholders understand this possible reduction as such. Should such reduction be necessary, it
cannot result in a tax deduction in the hands of the policyholder to claim in the policyholder's tax return.




GE 8/2006                                             BX 80
  STRATUS GUARANTEED INVESTMENT

DESCRIPTION

Stratus Guaranteed Investment is a lump-sum investment aimed at providing a guaranteed lump sum
after 5 or 7 years (according to the client's choice), as well as providing a monthly or annual income for
the five or seven year period.

Sanlam Life invests the single premium and guarantees the policyholder a maturity benefit amount at
the end of the term, as well as a monthly or annual income for the term.

Stratus Guaranteed Investment simply comprises Stratus Guaranteed Return (to provide the guaranteed
lump sum at the end of the term), plus Stratus Guaranteed Income (to provide the monthly or annual
income during the term).

The lump sum investment could be from a client's own sources or from the net after tax lump sum from
his/her retirement funds, but not from the compulsory two-thirds of his/her retirement fund benefit.

TERM

Terms of 5 and 7 years are available.

PREMIUMS

Minimum investment amount of the Stratus Guaranteed Return portion : R10 000

Furthermore, the minimum investment amount that may be invested in respect of the Stratus
Guaranteed Income portion, must be of such nature that the income payments will meet Sanlam Life's
minimum requirements (see “minimum income” below).

INCEPTION DATE

The inception date is the date on which the single premium is deposited at any contracted bank branch
(currently those of ABSA or First National Bank). It may be any day of the month, from the 2nd up to and
including the 29th. The date of payment determines the inception date of the Stratus Guaranteed
Income component (annuity portion) of the investment. If the date of payment is the 1st, the inception
date is the 29th of the previous month. The inception date of the Stratus Guaranteed Return component
(investment portion) of the investment is then one month later (when the first term annuity instalment is
paid as a premium). If the date of payment is on the 2nd to the 29th of a month, the inception date of
the term annuity component corresponds with the date of payment, and the inception date of the
investment component is a month later.




GE 8/2006                                         BX 81
                                   Date of payment                       Inception date
                             Day of
                                          Example                     Rule                  Example
                             month
    Stratus Guaranteed       1          1 November        # 29th of the previous month +   29 November
    Return component of                                     one month later
    the investment
                             2 – 29     * 20 November     One month later                  21 December
                             30 + 31    30 November       # 29th of the same month +       29 December
                                                            one month later
    Stratus Guaranteed       1          1 November        # 29th of the previous month     29 October
    Income component of
    the investment           2 – 29     * 20 November     Corresponds with the date of     21 November
                                                          payment
                             30 + 31    30 November       # 29th of the same month         29 November

Note:
•     * = If the date of payment falls on a Sunday, the SanQuote quotation will automatically
      change the date of payment to the Monday. The inception date will therefore be determined
      according to the date on the Monday.
•     # = As February only has 28 days, the inception date for dates of payment 1, 30 and 31 will
      not be the 29th, but the 28th. When February has 29 days, it will in fact be the 29th.
•     The first instalment is paid 1 day earlier than the date one month after the inception date.

NB: Intermediaries must deposit clients' cheques as soon as possible (where applicable), as
    that date determines the inception date.

AGE AT ENTRY

No minimum and maximum ages at entry will apply.

RIDER BENEFITS

No rider benefits are available.

RATE DATE

The rates used to determine the guarantee in the case of Stratus Guaranteed Return and the income in
the case of Stratus Guaranteed Income, are the rates that applied on the quotation date, subject to it
that the investment amount was deposited at a contracted bank branch within the validity period.

INCOME PAYABLE

An income is payable in terms of the Stratus Guaranteed Income.

Frequency

Depending on the frequency of the income, payments will take place as follows:

•     Monthly income
      Sanlam Life will pay the monthly income after each month. This payment will not necessarily be at
      the end of a calendar month. For instance, if the inception date of the Stratus Guaranteed Income
      portion of the Stratus Guaranteed Investment is 6 December 2005, then the first payment will be on
      5 January 2006, and on the 5th day of each month after that. The last payment will be on
      5 December 2010 for a 5-year investment.




GE 8/2006                                         BX 82
•   Annual income
    Sanlam Life will pay the annual income after each year. This payment, however, will not necessarily
    be the last day of a calendar month. For instance, if the inception date of the Stratus Guaranteed
    Income portion of the Stratus Guaranteed Investment is 6 December 2005, then the first payment
    will be on 5 December 2006, and on 5 December each year after that. The last payment will be on
    5 December 2010 for a 5-year investment

Growth in income

The policyholder may choose to have the monthly or annual income grow at a pre-selected rate each
year. This rate could be any percentage from 5% up to and including 15% a year. The chosen growth
rate must always be a full percentage, for instance 7% and not 7,5%. Sanlam Life guarantees the
amount

Minimum income

The minimum income is as follows:
Monthly : R 165,00 a month
Annually : R2 200,00 a year

MATURITY BENEFIT

On the maturity date, Sanlam Life in terms of the Stratus Guaranteed Return will pay a guaranteed
amount to the policyholder. However, under certain circumstances Sanlam Life could reduce this
amount.

The maturity benefit could be reduced if a government or authority:
•   increases the amount of the tax or levies payable for the assets that Sanlam Life keeps for the
    relevant policy;
•   requires that these assets be invested in another way.

For instance, in the case of an individual policyholder the maturity benefit currently allows for tax of 7,5%
on any capital gains on the underlying assets after 1 October 2001. Should the effective rate of capital
gains tax for long-term insurers be increased in future, the maturity benefit will be reduced accordingly.
It is important that intermediaries ensure policyholders understand this possible reduction as such.
Should such reduction be necessary, it cannot result in a tax deduction in the hands of the policyholder
to claim in the policyholder's tax return.

Should the policyholder not be liable for tax when a policy is taken out, Sanlam Life may also reduce the
maturity benefit if the policyholder's tax status changes. This is because of the different rates of tax
Sanlam Life must pay in terms of section 29 of the Income Tax Act, 58 of 1962, in the different
policyholder's tax funds (namely the Individual Policyholder's Fund, the Company Policyholder's Fund
and the Untaxed Policyholder's Fund).

DEATH BENEFIT

The death benefit is as follows:

Stratus Guaranteed Return

No death benefit will be payable at death of the policyholder (no life insured is involved). The policy will
continue until maturity date, unless the new owner surrenders the policy. Should the policyholder have
appointed a nominee for policy ownership, that nominee will become the owner of the policy after the
death of the policyholder, provided that that nominee accepts the nomination at that stage. Should there
be no such nominee at death of the policyholder, the policy will be an asset in the policyholder's estate.




GE 8/2006                                          BX 83
Stratus Guaranteed Income

•    At death of the policyholder
     No death benefit will be payable at death of the policyholder. The policy will continue until the end of
     the policy term, unless the new owner surrenders the policy. Should the policyholder have
     appointed a nominee for policy ownership, that nominee will become the new owner of the policy
     after the death of the policyholder, provided that he/she accepts the nomination at that stage.
     Should there be no such nomination at death of the policyholder, the policy will be an asset in the
     policyholder's estate.
•    At death of the policyholder
     If the annuitant is a natural person, the remaining income payments, as on the date on which
     Sanlam Life receives notice of the death, will be paid to the person(s) of the policyholder's choice.

FULL OR PARTIAL CASH WITHDRAWAL

Stratus Guaranteed Investment may be surrendered in full or partially. The policyholder must specify
whether only one part of the plan (for instance, the Stratus Guaranteed Return portion) must be
surrendered, or whether the total investment plan (Stratus Guaranteed Investment) must be
surrendered.

    Stratus Guaranteed      •   A full or partial cash withdrawal can be made. Sanlam Life charges a
    Return                      termination fee for any cash withdrawal. The termination fee is currently
                                as follows:
                                −   R925,00, which Sanlam Life may increase each year with the inflation
                                    rate (Sanlam Life will determine this inflation rate).
                                − A percentage of the value of the policy as calculated at the time. This
                                    percentage depends on when the cashing in takes place.
                                Sanlam Life may, in addition to the increase with the inflation rate, change
                                the fee from time to time.
                            •   Cash withdrawals may be made at any time.
                            •   The normal policy restrictions in terms of regulations in terms of Section
                                54 of the Long-term Insurance Act (previously Section 59D of the old Act)
                                will apply to cash withdrawals in the case of these policies.
    Stratus Guaranteed      •   The policy may be surrendered. The total cash value of the policy will be
    Income                      equal to the current value of the remaining income payments, discounted
                                at the prevailing interest rate applicable to surrenders, less a termination
                                fee, at present R0,00. Sanlam Life may change this fee at any time and
                                adjust it with the inflation rate.
                            •   The normal policy restrictions in terms of the Long-term Insurance Act
                                (previously Section 59D) will apply to surrenders.
                            •   Partial surrenders may be made as well.
                            •   A portion of the surrender amount could be subject to income tax.

LOANS

Loans are not permissible in the case of these policies.

ALTERATIONS

The policyholder may add an ad hoc single premium to the Stratus Guaranteed Return policy.

•    The remaining policy term of the relevant policy must at least be two years.
•    The minimum permissible ad hoc single premium is R10 000.
•    As much as 20% more than the original single premium may be added.
                  Example: Original single premium = R100 000
                               An ad hoc single premium of R10 000 to R120 000 may be added.
•    The guarantee rate applicable to additions is determined according to the date of addition. This rate
     will therefore differ from the original rate that applied when the policy was taken out.




GE 8/2006                                           BX 84
APPOINTMENT OF BENEFICIARIES TO RECEIVE THE DEATH BENEFITS

No beneficiary can be appointed, because there is no life insured applicable.

If the term annuitant and the policyholder are two different persons, and the term annuitant dies, the
policyholder becomes the new term annuitant. If the section 10A capital element exemption applied for
the annuitant until his death, it will continue, provided the new annuitant is the surviving spouse.

If the annuitant and the policyholder is the same person, he can appoint a nominee for policy ownership.
This nominee also becomes the new annuitant. The nominee can then decide to appoint someone else
as annuitant.

NOMINEES FOR POLICY-OWNERSHIP

The policyholder can nominate a person or persons to become the owner of the policies at the death of
the policyholder.

 At the death of the        If the nominee(s) accept the nomination for policy-ownership at the death of
 original policyholder      the original policyholder, that nominee or those nominees will become the
                            new policyholder(s) of the policy concerned.
 More than one              •   If more than one nominee were nominated for policy-ownership of a
 nominee nominated              policy, these nominees become the joint new policyholders of the policy
                                concerned (provided they accept the nominations).
                            •   For any dealings with the policy, except the revocation/amendment of a
                                policy-ownership nomination, all the new policyholders must reach
                                consensus and sign for the deal (e.g. surrender, cession, etc.). A
                                nomination for policy-ownership must be revocable to be contractually
                                binding.
                            •   Sanlam Life will not carry out any instruction or request regarding the
                                policy before the permission of all the policyholders concerned, has
                                been obtained. Sanlam Life will not go to the trouble of obtaining the
                                permission of each policyholder - the joint permission must accompany
                                the request for any dealings with the policy.
                            •   If the policy is surrendered, it must be a full surrender, and every
                                policyholder will then receive his/her portion of the surrender value.
                            •   No partial surrenders are allowed.
 Stratus Guaranteed         The annuity instalment paid from the Stratus Guaranteed Income part,
 Income part                cannot be divided between new policyholders. As a result, this part of the
                            investment must be surrendered at the death of the original policyholder.
                            The surrender value will then be divided between the new policyholders in
                            the same ratio as the allocated percentages of the various nominees.
 At the death of one of     •   After a nominee has accepted a nomination for policy-ownership, he
 the new policyholders          may nominate only one nominee for policy-ownership to become the
                                new policyholder of his part of the policy at his death.
                            •   This policyholder can also not deal with the policy without the permission
                                of all the other policyholders.
                            •   If the new policyholder dies without having nominated a nominee for
                                policy-ownership, his part of the policy will be an asset in his estate. In
                                this case the estate can only be finalised if the executor of the estate
                                can reach consensus with the other owners for the policy to be
                                surrendered.
 At maturity date           The guaranteed maturity value will be paid to the nominee(s) for ownership
                            on the maturity date. No continuations of these policies are allowed.




GE 8/2006                                         BX 85
CESSIONS

The policyholder may cede the Stratus Guaranteed Return, or the Stratus Guaranteed Income, or both
Stratus Guaranteed Return and Stratus Guaranteed Income.

 Stratus Guaranteed Return            •   All normal rules will apply.
                                      •   In the case of outright cessions the tax status of the new owner
                                          could change the tax status of the policy. This could result in a
                                          change in the guaranteed maturity benefit.
 Stratus Guaranteed Income            •   The Stratus Guaranteed Income may be ceded. Where the
                                          section 10A capital element exemption applied prior to the
                                          cessions, the exemption will lapse due to the cession, unless
                                          one spouse cedes the annuity to the other spouse.

TAX

Tax on income
Tax must be paid by the policyholder on the income. If the section 10A capital exemption applies, the
capital portion of the income is not taxable in the hands of the policyholder.

Tax on maturity proceeds
No tax is paid on the maturity proceeds as Sanlam Life pays the tax on the underlying investment. The
guaranteed amount may be reduced if a government or authority increases an amount of tax or requires
that the policy assets be invested in another way. It is important that intermediaries ensure
policyholders understand this possible reduction as such. Should such reduction be necessary, it
cannot result in a tax deduction in the hands of the policyholder to claim in the policyholder's tax return.




GE 8/2006                                          BX 86
  STRATUS GUARANTEED PROPERTY INVESTMENT


DESCRIPTION

Stratus Guaranteed Property Investment is a lump sum investment without cover, with an open term
after five years, and one or more lives insured.

The client invests a lump sum, the initial amount. The intermediary reaches agreement with the client
on an initial advisory fee. The difference between the initial amount and the initial advisory fee is the
single premium of the Stratus Guaranteed Property Investment.

The single premium is invested in a pool of assets, the Guaranteed Property Fund. This investment is
called the policy investment. The Guaranteed Property Fund consists mainly of selected South African
commercial properties.

An investment guarantee rate is guaranteed for these policies. This guarantee applies on the option
date. The amount so guaranteed is referred to as the 'Amount on option date'. Should the policy have
grown better than the guarantee rate up to the option date, the policyholder is entitled to two thirds of the
surplus as well. The option date is the date 5 years plus the number of days up to and including the end
of the relevant month following the inception date of the policy.

This product can be combined with a term annuity to provide an income.

INITIAL TERM

The initial term of the policy is 5 years.

After the initial term has expired, the term is open-ended. This means that the policy will not
automatically be paid out after the initial term has expired, but that the policy will continue until the
policyholder claims the proceeds, or until the death of the life insured, or until the death of the last
surviving insured.

THE OPTION DATE

The option date is the date 5 years plus the number of days up to and including the relevant month after
the inception date of the policy.

Example:

Inception date     : 12 October 2003
Option date        : 1 November 2008

AMOUNT ON OPTION DATE

An investment guarantee based on a guarantee rate applies in the case of these policies. The
investment guarantee applies only on the option date. Should the policy have grown better than the
guarantee rate up to the option date, the policyholder is entitled to two-thirds of the surplus as well.
Units are increased or decreased on the last day of the month prior to the option date, depending on
whether the net investment return rate was better or worse than the guarantee rate (see below).

After the option date the Amount on option date no longer applies, and the value of the policy
investment will be equal to the units (at that stage) x price.




GE 8/2006                                          BX 87
Example of calculation of the Amount on option date (as calculated at new business
stage):

Inception date                                                          : 12 October 2003
Single premium (therefore after initial advisory fee has been deducted) : R100 000,00
Option date (date on which the guarantee applies)                       : 1 November 2008
Assume an investment guarantee rate of 6,25% per annum.
                                                              5 + 19/365,25
Amount on option date (wb)           = R100 000,00 (1,0625)
                                     = R135 836 (rounded off to the nearest rand

Adjustment of units on the option date

On the last day of the month before the option date (thus on 31 October 2008, in the example) Sanlam
Life determines the actual performance of the Guaranteed Property Fund. Units that Sanlam Life holds
for the benefit of the policyholder, are adjusted as follows:

•   If the unit x price > Amount on option date:
    If the net investment return rate of the policy investment exceeds the investment guarantee rate (in
    this case 6,25% per annum was assumed), two-thirds of the surplus will be available additionally.

    Amount available on option date = [{(units x price) – wb} x 2/3] + wb

    Assume that on 31 October 2008 the units total 99 009,9000 and the selling price is 2,0114. The
    units will then be adjusted as follows:

    Amount available on the option date
                                            2
    = [{(99 009,9000 x 2,0114) – R135 836} x /3] + R135 836

    = R178 044 (rounded off to the nearest rand)

    New units     = amount available on the option date ÷ selling price
                  = 178 044 ÷ 2,0114
                  = 88 517,4505 units

•   If the units x price < Amount on option date:
    If the actual net investment return rate of the policy investment on the option date is less than the
    investment guarantee rate per annum, Sanlam Life will add units for the policyholder’s benefit at
    Sanlam Life’s expense so that the total value of the units that are held for the policyholder, equals
    the amount guaranteed on the option date.

    Suppose that on 31 October 2008 units are 98 018,1234 and the selling price is 1,2012. Units x
    price are then equal to R117 739, which is less than the Amount on the option date of R135 836.
    The units will then be adjusted as follows:

    New units     = 135 836 ÷ 1,2012
                  = 113 083,5831

CHANGE OF AMOUNT ON OPTION DATE

The Amount on option date can be reduced if the policyholder transfers his or her rights in terms of the
policy to a person or an institution with a different tax status, or if a government or authority

•   increases the amount of tax or levies payable for the assets that Sanlam Life keeps for these
    policies
•   requires that these assets be invested in another way.

For example, the Amount on option date currently allows for tax of 7,5% on any capital gains on the
underlying assets after 1 October 2001. Should the effective rate of capital gains tax for long-term
insurers be increased in future, the amount will be reduced accordingly. It is important that
intermediaries ensure policyholders understand this possible reduction as such. Should such reduction
be necessary, it cannot result in a tax deduction in the hands of the policyholder to claim in the
policyholder's tax return.



GE 8/2006                                          BX 88
CHANGE OF AMOUNT ON OPTION DATE (continued)

If the policyholder is non-taxable when the policy is taken out, Sanlam Life may also reduce the maturity
benefit if the policyholder’s tax status should change. This is because of the different rates of tax
Sanlam Life must pay in terms of section 29 of the Income Tax Act, 58 of 1962, in the different
policyholder's tax funds (namely the Individual Policyholder's Fund, the Company Policyholder's Fund
and the Untaxed Policyholder's Fund).

INCOME OPTION

The Stratus Guaranteed Property Investment can be combined with a term annuity to provide an income

•   Only fixed income without growth can be chosen.
•   The origin of the purchase sum of the term annuity must be of such a nature that the purchases of
    the term annuity are optional.
•   The minimum purchase sum of the term annuity is R10 000.
•   Only monthly income can be chosen.

PREMIUMS

Only single premiums are allowed.

The minimum single premium is as follows:

•   For individuals
    A minimum single premium of R10 000 is allowed. This amount excludes the initial advisory fee and
    the purchase sum for the term annuity (if an income is required). The minimum single premium for
    the term annuity is also R10 000.

•   For institutions and trusts not liable for tax
    The minimum single premium allowed is R1 million. This amount includes the initial advice fee.

INCEPTION DATE

The date of payment is the inception date

AGE AT ENTRY

No minimum or maximum ages apply.

LIVES INSURED

One or more lives insured can be insured in terms of a Stratus Guaranteed Property Investment. The
policy is terminated when the life insured dies. In the event of more than one life insured, the policy is
terminated when the last surviving life insured dies.

DEATH BENEFIT

No death guarantee applies to these policies. At the death of the (last surviving) life insured, the cash
value of the policy is payable, as if the policy had been surrendered on the date on which Sanlam Life
was informed of the death.

FULL CASH WITHDRAWAL

No investment guarantee applies when these policies are surrendered. Before the option date the cash
value of the policy equals the investment amount plus the net investment return of the policy investment.
If that net investment return exceeds the investment guarantee rate, only two-thirds of the surplus will be
payable. In order to recover the levy equal to one-third of the surplus, Sanlam Life cancels units to that
value. Furthermore Sanlam Life will levy a termination fee, currently 3% of the cash value. We can
change the termination fee at any time. One possible reason for an increase in the termination fee can
be to make provision for the fact that properties may not be easily marketable on the cashing-in date.

If the policyholder does not take the available Amount on option date, the cash value thereafter will
equal the total number of units at that stage, multiplied by the price on the date on which the policy is
cashed in. At present no termination fee is recovered if the policy is cashed in on or after the option
date. Sanlam Life can change this at any time.

GE 8/2006                                         BX 89
FULL CASH WITHDRAWAL (continued)

Example 1

Assume an investment guarantee rate of 6% per annum.

Cashing in before the option date, accrued value of policy investment on cashing-in date is greater than
the investment amount plus interest at 6%

Inception date                                                     : 1 October 2003
Cashing-in date                                                    : 1 October 2006
Investment amount of policy                                        : R100 000,00
Accrued value of the policy investment on 1 October 2006           : R152 087,50
Investment amount plus interest at 6% per annum on 1 October 2006 : R119 101,60
                                                                 2
Cash value on 1 October 2006 = [{(R152 087,50 – R119 101,60) x /3} + R119 101,60] x 0,97
                                  = R136 859,43

Example 2

Assume an investment guarantee rate of 6% per annum.

Cashing in before the option date, accrued value of policy investment on cashing-in date is less than
the investment amount plus interest at 6% per annum.

Inception date                                                            : 1 October 2003
Cashing-in date                                                           : 1 October 2006
Investment amount of policy                                               : R100 000,00
Accrued value of the policy investment on 1 October 2006                  : R115 000,00
Investment amount plus interest at 6% per annum on 1 October 2006         : R119 101,60
Cash value on 1 October 2006       = R115 000,00 x 0,97
                                  = R111 550,00

Example 3:

If the policy is cashed in after the option date has expired, the investment guarantee plays no role in the
calculation of such a surrender value. Thereafter the surrender value is simply equal to the units
multiplied by the price. No termination fee applies after the option date.

During the restricted period legislation limits the amount of the cash value that Sanlam Life may pay to
the policyholder. No guarantees will apply to the amount not paid.

PARTIAL CASH WITHDRAWAL

If a partial cash withdrawal is done before the option date, Sanlam Life will charge a termination fee,
currently equal to 3% of the amount that is being withdrawn. We can change the termination fee at any
time. One possible reason for an increase in the termination fee can be to make provision for the fact
that properties may not be easily marketable on the cashing-in date.

The Amount on option date will decrease by the amount of cash withdrawn. At present we do not
charge any termination fees if a cash withdrawal is made after the option date. However, we may
change this at any time.

LOANS

No loans are allowed in the case of these policies.




GE 8/2006                                         BX 90
CONTINUATIONS

Continuations from the maturity date of policies on the old administration system in a Stratus
Guaranteed Property Investment, are possible. These policies can be continued only for capital growth.
No income option is available.

SWITCHING

No switching can be done from and to this product.

TAX STATUSES

Individuals, tax-exempt institutions and tax-exempt trusts may apply.




GE 8/2006                                        BX 91
    STRATUS TRADED POLICIES


DESCRIPTION

Traded policies are endowment policies and Stratus Guaranteed Return policies (sinking fund policies)
which have reached maturity and on which the policyholder does not wish to exercise the continuation
option. Sanlam Endowment Options (Pty) Ltd takes over the policies, pays the maturity value to the
original policyholders and offers the policies for sale to new investors.

ADVANTAGES FOR THE INVESTOR

The traded policy offers the new investor the following advantages:
•   The investor gains immediate access to an after-tax return (However, see Tax implications below).
•   The investor can cash the policy in at any time.
•   After the two-month waiting period, the investor can apply for an interest-free loan against the policy.
•   The investor has the following options:
    −   Full capital growth in any one or more of the available investment funds; or
    −   Regular cash withdrawals from any available investment fund (see Tax implications below).

INITIAL TERM

No term is applicable. However, the value of the policy is available at any time.

AVAILABLE INVESTMENT FUNDS

See section E(1).

SWITCHING BETWEEN INVESTMENT FUNDS

See section C(3).

INVESTMENT GUARANTEES

See section C(4).

THE INVESTMENT GUARANTEE DATE

•   If an investment guarantee is chosen, the policy has one investment guarantee date.
•   The investment guarantee date is five years after the continuation date.

PREMIUMS

No premium payments are permitted in addition to the investment amount.

The minimum investment amount (amount paid less initial advisory fee) is as follows:
•   For capital growth                                                     : R 7 500
•   For regular cash withdrawals in the Guaranteed Capital Fund            : R15 000

INCEPTION DATE (TRANSFER DATE)

The inception date (transfer date) is the date on which the money for the policy is received from the new
policyholder.

NB:
Intermediaries must deposit clients’ cheques (where applicable) as soon as possible, since that
date determines the inception date and price at which units are purchased. If there are
significant market fluctuations between the day on which the client hands the cheque to the
intermediary and the day on which the cheque is deposited, claims could arise against the
intermediary and Sanlam Life. Intermediaries will be held personally liable for such claims.




GE 8/2006                                          BX 92
AGE AT ENTRY

The minimum and maximum ages at entry are:
    •   Minimum : 1 anb
    •   Maximum : 90 anb

DEATH BENEFIT

If traded policy is an endowment policy

At the death of the last surviving life insured, the value of the policy investment as on the date on which
Sanlam Life receives notice of the death, is payable. If the policyholder chose the investment guarantee
in the case of an investment fund where such a guarantee is available, a minimum rate of return is
guaranteed on the investment in each investment fund for which an investment guarantee was chosen.

At the death of the policyholder, the policy will continue if there are other surviving co-insureds on the
policy. The cash value of the policy is an asset in the deceased’s estate if the policyholder did not
nominate anyone for policy-ownership. If the policyholder did nominate someone for policy-ownership,
the cash value of the policy will not be an asset of the estate, but a deemed asset for estate duty
purposes (because it is property of which the deceased was immediately prior to his/her death
competent to dispose for his/her own benefit or for the benefit of his/her estate).

If traded policy is a sinking fund policy

At death of the policyholder the policy will continue, as there are no lives insured. The cash value of the
policy is an asset in the deceased’s estate if the policyholder did not nominate anyone for policy-
ownership. If the policyholder did nominate someone for policy-ownership, the cash value of the policy
will not be an asset of the estate, but a deemed asset for estate duty purposes (because it is property of
which the deceased was immediately prior to his/her death competent to dispose for his/her own benefit
or for the benefit of his/her estate).

REGULAR CASH WITHDRAWAL AMOUNTS

The policyholder can choose to receive regular cash withdrawal amounts on a Stratus Traded policy.

The policyholder chooses any income rate. The regular cash withdrawal amounts will then be equal to
the chosen percentage of the value of the policy investment in the chosen investment fund(s).

The policyholder cannot choose a fixed cash withdrawal amount.

LOANS

•   Loans are available two months after the date of transfer.
•   A loan levy is charged.
•   A number of units (in the underlying investment fund) to the value of the loan amount granted, will be
    switched to units in the Stratus Policyholder Loan Fund. The latter fund does not participate in any
    growth. Settling the loan would result in a switch of units in the Stratus Policyholder Loan Fund to
    units in the policy's investment fund - at the then prevailing selling price of the relevant investment
    fund. If the price of the units in the policy's investment fund at that stage is higher than it was when
    the loan was entered into, it means that fewer units will be switched to the policy's investment fund.
    The repayment amount may not exceed the loan amount (without the loan levy). If the full loan is
    repaid in one installment, the value of the units on the repayment date will, however, be equal to the
    value of the units that were cancelled when the loan was entered into (loan levy excluded). The
    investment return that the policyholder does not get during the loan period, can be regarded as
    “interest paid” over the loan period.
•   The minimum loan amount is R1 000. Once the loan has been granted, the remaining value of the
    policy investment must be at least R10 000.
•   Repayments may be made at any time.
•   The minimum repayment amount is the smaller of the outstanding loan amount and R10 000.
•   The terms of the loan will be determined when the loan is made.




GE 8/2006                                          BX 93
LIFE INSUREDS

If the policy purchased is an endowment policy, additional lives insured (maximum of three) must be
added to the policy to ensure that it is not terminated at the death of the investor (new owner). The
policy is terminated at the death of the last surviving life insured.

If the traded policy is a sinking fund policy (Stratus Guaranteed Return policy), no lives insured are
added on the policy.

CESSIONS AND APPOINTING BENEFICIARIES / NOMINEES

•   All the normal rules apply (as applicable to Sanlam Life’s other endowment policies and sinking fund
    policies).
•   In the case of outright cessions, the tax status of the new owner could change the tax status of the
    policy. This will result in a switch to the correct policyholder's tax fund.
•   There is no limit on the number of beneficiaries (in the case of endowment policies) who may be
    appointed. However, only one nominee may be appointed for policy-ownership.

TAX IMPLICATIONS

•   According to current tax practice, cash withdrawals from an investment in the Guaranteed Capital
    Fund are not taxed as income in the hands of the policyholder, since Sanlam Life pays the tax on
    any profits in the investment fund of the policy.
•   On a traded policy the policyholder will be taxed on the capital gains portion of every withdrawal.
•   As there is capital gains tax implications it is therefore necessary for the client to sign a declaration
    that he or she is aware of the tax implications.
•   The SARS will assess the tax status according to each buyer’s reasons for acquiring a traded policy
    to establish whether there is an income tax or capital gains tax implication.




GE 8/2006                                          BX 94
B.         STRATUS PREMIER RANGE OF PRODUCTS

Stratus Premier is available in the following products:

Stratus Premier Endowment
Stratus Premier Sinking Fund
Stratus Premier Continuation With/Without Life Insured
Stratus Premier Retirement Annuity
Stratus Premier Retirement Annuity Continuation
Stratus Premier Endowment for Provident Funds
Stratus Premier Provident Fund Continuation
Stratus Premier With Preservation Funds
Stratus Premier Preservation Funds Continuation
Stratus Premier Investment Linked Pension
Stratus Premier Composite Annuity

For these products the only differences between Stratus and Stratus Premier are:
      •   minimum premiums
      •   available investment funds

MINIMUM PREMIUMS

The minimum premiums/contributions for Premier products are as follows:

                                                                  Recurring contribution
                                                      Ad hoc           per month1               Recurring
                                       Single
                                       contri-        addition                                    contri-
                                                   (single con-   Initial term   Initial term     bution
                                       bution                      10 years       less than
                                                     tribution)                                 increase1
                                                                    or more        10 years
    Non-conversions:
    Single contribution only
    (endowments):                      R10 000       R2 500           N/a            N/a           N/a

    Single contribution only
    (RA's):                            R10 000       R2 500           N/a            N/a           N/a

    Single contribution plus
    recurring contribution:            R10 000       R2 500          R250           R500          R70

    Recurring contribution only
    (upfront commission):                N/a         R2 500          R250           R500          R70

    Recurring contribution only
    (recurring commission):              N/a         R2 500          R250           R250          R70
                                               2
    Conversions                        R2 500        R2 500          R250           R250          R70

1
    The minimum amount that may be invested per investment fund is R50,00.
2
    This relates to the transfer amount from the old (converted) policy.

AVAILABLE INVESTMENT FUNDS

See section C(1).




GE 8/2006                                           BX 95
C.        FEATURES OF STRATUS
1.        INVESTMENT FUNDS

1.1       FUNDS AVAILABLE FOR STRATUS AND STRATUS PREMIER

ABSOLUTE RETURN FUND (CPIX + 3%)

Objective

The objective of the fund is:
•    No loss of capital (no negative returns) over any rolling 12 month period
•    To achieve a return (before tax and charges) of CPIX plus 3% over any rolling 3 to 5 year period.

Risk level

Conservative

Fund Management Fee

1.25% per annum

Benchmark

CPIX plus 3% before the deduction of fees and tax

MULTI-MANAGER ABSOLUTE RETURN FUND (CPIX + 3%)

Objective

The objective of the fund is:
•    No loss of capital (no negative returns) over any rolling 12 month period
•    To achieve a return (before tax and charges) of CPIX plus 3% over any rolling 3 to 5 year period.

Risk level

Conservative

Fund Management Fee

1.35% per annum

Benchmark

CPIX plus 3% before the deduction of fees and tax




GE 8/2006                                         BX 96
PPS MULTI-MANAGER INFLATION + 3%

Objective

The objective of the fund is:

•   No loss of capital (no negative returns) over any rolling 12 month period
•   To achieve a return (before tax and charges) of CPIX plus 3% over any rolling 2 year period.

Risk level

Conservative

Fund Management Fee

1.35% per annum

Benchmark

CPIX plus 3% before the deduction of fees and tax.

ABSOLUTE RETURN FUND (CPIX + 5%)

Objective

The objective of the fund is:
•   No loss of capital (no negative returns) over any rolling 12 month period
•   To achieve a return (before tax and charges) of CPIX plus 5% over any rolling 3 to 5 year period.

Risk level

Cautious

Fund Management Fee

1.25% per annum

Benchmark

CPIX plus 5% before the deduction of fees and tax




GE 8/2006                                        BX 97
MULTI-MANAGER ABSOLUTE RETURN FUND (CPIX + 5%)

Objective

The objective of the fund is:
•   No loss of capital (no negative returns) over any rolling 12 month period
•   To achieve a return (before tax and charges) of CPIX plus 5% over any rolling 3 to 5 year period.

Risk level

Cautious

Fund Management Fee

1.35% per annum

Benchmark

CPIX Index plus 5% before the deduction of fees and tax

PPS MULTI-MANAGER INFLATION + 5%

Objective

The objective of the fund is:

•   No loss of capital (no negative returns) over any rolling 24 month period
•   To achieve a return (before tax and charges) of CPIX plus 5% over any rolling 3 year period.

Risk level

Cautious

Fund Management Fee

1.35% per annum

Benchmark

CPIX plus 5% before the deduction of fees and tax.




GE 8/2006                                        BX 98
VESTING BONUS FUND

Objective
This is a fund for an investor interested in an investment where the growth becomes part of the
investment and cannot be removed due to deteriorating market conditions. The growth in the fund is
smoothed out over the term as the fund aims for moderate growth over the longer term. The fund
manager will try to keep the fund stable, even during strong fluctuations in the market. The growth in
this fund may therefore be less than that of more aggressive funds.

Risk level
Cautious

Fund Management Fee
2.2% per annum

Benchmark
               Asset Category                    Weighting                     Benchmark
   RSA Equities                                    37.5%         Shareholder Weighted
                                                                 All Share Index (PENI)
   RSA Fixed Interest                           44.5% minus      BEASSA TRI (Total Return
                                                     A           Hedge Equity Index)
   Foreign equities                                 7.5%         Morgan Stanley Capital
                                                                 International World
                                                                 (Developed markets) Index
   Foreign Fixed assets                             7.5%         Lehman Global Aggregate
   RSA Cash                                          3%          SteFI (Short term fixed interest index)
   Property & Development Investments                A%          Own Return

SIM MANAGED CAUTIOUS SOLUTION

Objective

This fund aims to provide positive returns over any rolling 12 month period, and a return of CPIX + 5%
over any rolling 3 to 5 year period. Capital preservation is of primary importance to the cautious investor
but this fund also offers the opportunity to participate in capital growth potential.

The fund is a single solution consisting of a combination of the best specialist investment management
expertise available in the Sanlam Group, both locally and internationally. The fund is diversified, actively
managed and constructed to offer the client a portfolio with return and risk qualities that reflect the
profile of this fund. Investments will be made through various asset classes primarily bonds, cash,
equities, inflation-linked bonds, listed property and will invest in South African and International markets.

Risk level

Cautious

Fund Management Fee

1.40% per annum




GE 8/2006                                          BX 99
BALANCED FUND (LOW EQUITY)

Objective

Your client would like to share in the excellent growth potential offered by South African equities, bonds
and cash. Your client is seeking a maximum capital growth over the medium to long term, with
moderate volatility in the short to medium term.

Risk level

Moderate

Fund Management Fee

1.1% per annum

Mandate and Benchmark
               Mandate                  Weighting                       Benchmark
     RSA Cash                              15%          SteFI
     RSA Bonds                             30%          BEASSA TRI Total Return
     RSA Equity                            35%          PENI
     RSA Alternative/Property               5%          97 Real Index (JSE code J086)
     Foreign Bonds                         2.5%        Lehman Global Aggregate
     Foreign Equities                      7.5%         MSCI World (Developed Markets)
     Foreign Cash                          2.5%        US$ 3 month LIBID
     Foreign Alternative/Property          2.5%        EPRA / NAREIT Global Real Estate Index

No more than 55% of the fund may be invested in volatile assets (local equities and foreign assets).

MULTI-MANAGER BALANCED FUND (LOW EQUITY)

Objective

The investor will share in the excellent growth potential offered by primarily South African equities,
bonds and cash securities. Your client has a medium term investment horizon and is willing to accept a
moderate level of growth. Capital growth rather than capital security, is of primary importance to
him/her.

Risk level

Moderate

Fund Management Fee

1.35% per annum

Mandate and Benchmark
               Mandate                  Weighting                       Benchmark
     RSA Cash                             17.5%            SteFI
     RSA Bonds                            32.5%            BEASSA TRI Total Return
     RSA Equity                            35%             PENI
     Foreign Bonds                         7.5%            Lehman Global Aggregate
     Foreign Equities                      7.5%            MSCI World (Developed Markets)

No more than 55% of the fund may be invested in volatile assets (local equities and foreign assets).


GE 8/2006                                         BX 100
SIM MANAGED MODERATE SOLUTION

Objective

The primary objective of the fund is to achieve long-term capital growth and income generation at
volatility levels that reflect a moderate risk profile. The investments are diversified across primarily
South African equities, bonds and cash securities and international investments can also be included.
The investor in this fund has a moderate risk profile and wants to invest in a quality diversified portfolio.

The fund is a single solution consisting of a combination of the best specialist investment management
expertise available in the Sanlam Group, both locally and internationally. The fund is diversified, actively
managed and constructed to offer the client a portfolio with return and risk qualities that reflect the
profile of this fund.

Risk level

Moderate

Fund Management Fee

1.40% per annum

BALANCED FUND (MEDIUM EQUITY)

Objective

The goal of the fund is to provide maximum capital growth over the medium to long term, with moderate
to moderately high volatility over the short to medium term. It will be suitable for an investor with a
moderately aggressive risk profile, who still wants a well diversified managed option.

Risk level

Moderately aggressive

Fund Management Fee

1.1% per annum

Fund Mandate and Benchmark
                Mandate                  Weighting                        Benchmark
     RSA Cash                                10%            SteFI
     RSA Bonds                               20%            BEASSA TRI Total Return
     RSA Equity                              50%            PENI
     RSA Alternative/Property                5%             97 Real Index (JSE code J086)
     Foreign Bonds                          2.5%            Lehman Global Aggregate
     Foreign Equities                       7.5%            MSCI World (Developed Markets)
     Foreign Cash                           2.5%            US$ 3 month LIBID
     Foreign Alternative/Property           2.5%            EPRA / NAREIT Global Real Estate Index




GE 8/2006                                          BX 101
MULTI-MANAGER BALANCED FUND (MEDIUM EQUITY)

Objective

The goal of the fund is to provide maximum capital growth over the medium to long term, with moderate
volatility over the short to medium term. It will be suitable for an investor with a moderately aggressive
risk profile, who still wants a well diversified managed option, both in term of asset classes and asset
managers.

Risk level

Moderately aggressive

Fund Management Fee

1.35% per annum

Fund Mandate and Benchmark
                Mandate                 Weighting                       Benchmark
     RSA Cash                              10%             SteFI
     RSA Bonds                             25%             BEASSA TRI Total Return
     RSA Equity                            50%             PENI
     Foreign Bonds                         7.5%            Lehman Global Aggregate
     Foreign Equities                      7.5%            MSCI World (Developed Markets)

Sanlam Multi Manager will have freedom to manage the investment fund within the mandates, and to
determine the split and allocation of the various components of the investment fund between the
different appointed asset managers.

PPS MULTI-MANAGER INFLATION + 8%

Objective

The objective of the fund is:

•   No loss of capital (no negative returns) over any rolling 36 month period
•   To achieve a return (before tax and charges) of CPIX plus 8% over any rolling 5 year period.

Risk level

Aggressive

Fund Management Fee

1.35% per annum

Benchmark

CPIX plus 8% before the deduction of fees and tax.




GE 8/2006                                         BX 102
BALANCED FUND (HIGH EQUITY)

Objective

The goal of the fund is to provide maximum capital growth over the medium to long term, with
moderately high volatility over the short to medium term. It will be suitable for an investor with an
aggressive risk profile, who still wants a well, diversified managed option.

Risk level

Aggressive

Fund Management Fee

1.1% per annum

Fund Mandate and Benchmark
                Mandate                  Weighting                        Benchmark
     RSA Cash                               5%              SteFI
     RSA Bonds                              15%             BEASSA TRI Total Return
     RSA Equity                             60%             PENI
     RSA Alternative/Property               5%              97 Real Index (JSE code J086)
     Foreign Bonds                          2.5%            Lehman Global Aggregate
     Foreign Equities                       7.5%            MSCI World (Developed Markets)
     Foreign Cash                           2.5%            US$ 3 month LIBID
     Foreign Alternative/Property           2.5%            EPRA / NAREIT Global Real Estate Index

MULTI-MANAGER BALANCED FUND (HIGH EQUITY)

Objective

The fund aims to achieve to long-term capital growth and will invest predominantly in unit trusts.

Risk level

Aggressive

Fund Management Fee

1.5% per annum

Mandate and Benchmark
                 Mandate                 Weighting                       Benchmark
      RSA Cash                               5%         SteFI
      RSA Bonds                             20%         BEASSA TRI Total Return
      RSA Equity                            60%         PENI
      Foreign Bonds                         7.5%        Lehman Global Aggregate
      Foreign Equities                      7.5%        MSCI World (Developed Markets)

Sanlam Multi Manager will have freedom to manage the investment fund within the mandates, and to
determine the split and allocation of the various components of the investment fund between the
different appointed asset managers.



GE 8/2006                                          BX 103
SIM MANAGED AGGRESSIVE SOLUTION

Objective

The primary objective of the fund is to maximise long-term capital growth at volatility levels that reflect
an aggressive risk profile. The investments are diversified across primarily South African equities,
bonds and cash securities and international investments can also be included. The investor in this fund
has an aggressive risk profile and accepts short term volatility in fund value.

The fund is a single solution consisting of a combination of the best specialist investment management
expertise available in the Sanlam Group, both locally and internationally. The fund is diversified, actively
managed and constructed to offer the client a portfolio with return and risk qualities that reflect the
profile of this fund.

Risk level

Aggressive

Fund Management Fee

1.40% per annum

GUARANTEED CAPITAL FUND

Objective

Your client will share in the full growth of the assets in this fund. There is no risk attached to an
investment in this fund. Sanlam Life guarantees that this growth will never be negative.

Asset class

Cash

Fund Management Fee

1.1% per annum

PPS ENHANCED CASH FUND

Objective

Your client will share in the full growth of the assets in this fund. There is no risk attached to an
investment in this fund. Sanlam Life guarantees that this growth will never be negative.

Risk level

Conservative

Fund Management Fee

1.35% per annum




GE 8/2006                                         BX 104
BOND FUND

Objective

The fund aims to provide long-term investment income and capital growth through investing in primarily
fixed interest and cash.

Asset class

Fixed interest

Fund Management Fee

1.1% per annum

Benchmark

BEASSA Total Return Index

PROPERTY FUND

Objective

As an investor you require investment returns, which reflect the rental growth and increase in property
values offered by the property market. This fund will combine both of these aspects into consistent
capital appreciation, with moderate risk. You may also require the diversification benefits of investing in
a fund with exposure to the South African property market.

Asset class

Property

Fund Management Fee

1.35% per annum

Benchmark

              Asset Category           Weighting                      Benchmark
            RSA Property Shares           97%           97 Real Index (JSE code J086)
                                                        The maximum weight in the Index for
                                                        any one counter is capped at 30%
            RSA Cash                       3%           SteFI (Short term fixed interest index)




GE 8/2006                                         BX 105
SANLAM EQUITY FUND

Objective

The Sanlam Equity Fund is focused on a more aggressive approach towards investment strategy and
asset composition. The fund mainly invests in shares on the JSE Securities. The fund manager has
total investment freedom and can make aggressive investment decisions to obtain optimal investment
growth.

Asset class

Equity

Fund Management Fee

1.1% per annum

Benchmark

         Asset Category          Weighting                             Benchmark
    RSA Equities                    82%           Shareholder weighted
                                                  All share Index (PENI)
    Foreign Equities                15%           Morgan Stanley Capital
                                                  International World (Develop markets) Equity Index
    RSA Cash                         3%           SteFI (Short term fixed interest index)

MULTI-MANAGER EQUITY FUND

Objective

Your client will share in the excellent growth potential of the South African equity market and is willing to
accept short-term volatility in order to maximise potential long-term growth. Capital growth, rather than
security, is of primary importance to your client.

Asset class

Equity

Fund Management Fee

1.35% per annum

Benchmark

100% equities




GE 8/2006                                         BX 106
OFFSHORE / INTERNATIONAL HEDGE FUND

Objective

This fund is ideal for the investor who wants exposure to the international investment market, but a low
risk.

Risk level

Cautious (with exchange rate risks)

Fund Management Fee

2.0% per annum

Benchmark

US$ 3 month LIBID

OFFSHORE / INTERNATIONAL BALANCED FUND

Objective

This fund is for the investor looking for investment growth and who wants to invest offshore. The fund
provides a maximum capital growth over the medium term to long term, with a moderate risk over the
short term.

Risk level

Moderately aggressive (with exchange rate risks)

Fund Management Fee

2.0% per annum

Benchmark

MSCI World 65% Developed Equities Markets
35% Lehman Global Aggregate

OFFSHORE / INTERNATIONAL MONEY MARKET FUND US$

Objective

Money market funds offer a measure of security for investors who are not prepared to expose their
investment returns to the volatility of global equity markets.

Asset class

Cash

Fund Management Fee

1.3% per annum

Benchmark

US$ 3 month LIBID




GE 8/2006                                       BX 107
OFFSHORE / INTERNATIONAL MONEY MARKET FUND £

Objective

Money market funds offer a measure of security for investors who are not prepared to expose their
investment returns to the volatility of global equity markets.

Asset class

Cash

Fund Management Fee

1.3% per annum

Benchmark

1 month Sterling (£) LIBID

OFFSHORE / INTERNATIONAL MONEY MARKET FUND €

Objective

Money market funds offer a measure of security for investors who are not prepared to expose their
investment returns to the volatility of global equity markets.

Asset class

Cash

Fund Management Fee

1.3% per annum

Benchmark

1 month Euro (€)

OFFSHORE / INTERNATIONAL BOND FUND

Objective

The goal of the fund is to provide an active building block for an investor who wants exposure to foreign
bond markets, and who is prepared to accept moderate volatility over the medium term as well as the
additional associated currency risk.

Asset class

Fixed interest

Fund Management Fee

1.8% per annum

Mandate and Benchmark

The fund mandate is to be invested 100% in foreign bonds, although a portion may be retained in
foreign and local cash from time to time. The fund benchmark will be the Lehman Global Aggregate
Index.




GE 8/2006                                        BX 108
OFFSHORE / INTERNATIONAL PROPERTY FUND

Objective

The goal of the fund is to provide an active building block for an investor who wants exposure to foreign
property markets, and who is prepared to accept moderate volatility over the medium term as well as the
additional associated currency risk.

Asset class

Property

Fund Management Fee

2.0% per annum

Mandate and Benchmark

The fund mandate is to be invested 100% in foreign property, although a portion may be retained in
foreign and local cash from time to time. The fund benchmark will be the EPRA / NAREIT Global Real
Estate Index.

OFFSHORE / INTERNATIONAL EQUITY FUND

Objective

This fund is suitable for the investor seeking the potentially excellent capital growth associated with
equity funds, and who wants to invest offshore.

Asset class

Equity

Fund Management Fee

2.0% per annum

Benchmark

MSCI World Developed Equity markets




GE 8/2006                                        BX 109
1.2      FUNDS AVAILABLE FOR STRATUS PREMIER ONLY

CORONATION STRATEGIC INCOME FUND

Objective

This fund aims to provide high income with greater diversification than a pure income fund as well as to
seek opportunities to maximise capital gains whilst retaining a focus on capital preservation. The fund is
a highly diversified, actively managed fund investing in quality income generating instruments.

Unit Trust class

Fixed Interest – Varied Specialist

Fund Management Fee

2.00% per annum

INVESTEC ABSOLUTE INCOME FUND

Objective

This fund aims to achieve total returns in excess of inflation on a consistent basis. The fund is mainly
invested in income-generating assets, cash, bonds, inflation-linked bonds and listed property. Portions
of the fund are protected from negative returns using financial instruments such as bond index futures
thereby aiming to preserve capital.

Unit Trust class

Fixed Interest – Varied Specialist

Fund Management Fee

1.67% per annum

SANLAM INCOME FUND

Objective

The fund aims to offer a reasonable level of income with relative capital stability. The fund invests in
local interest bearing-investments such as gilts and fixed deposits and other high income earning
securities. This fund is suited for clients who want exposure to the capital market and who need a
higher income than that offered by equity unit trusts, and relative capital stability.

Unit Trust class

Fixed Interest – Income

Fund Management Fee

1.6% per annum




GE 8/2006                                        BX 110
CORONATION PROPERTY EQUITY FUND

Objective

This fund aims to produce high income yields and long-term capital growth by investing in quality listed
property assets in the real estate sector of FTSE/JSE Securities Exchange.

Unit Trust class

Property

Fund Management Fee

2.24% per annum

ALLAN GRAY STABLE FUND

Objective

This fund aims to provide a return that exceeds the return of bank deposits (both on after-tax basis) by a
few percent. The fund also seeks to provide a high level of capital stability. The risk of loss over any
two-year period is low.

Unit Trust class

Asset Allocation – Prudential

Fund Management Fee

1.95% per annum

ALLAN GRAY BALANCED FUND

Objective

This fund’s investment strategy is to earn a higher rate of return than the market value-weighted
average of the domestic medium equity prudential unit trust sector excluding the Allan Gray Balanced
Fund, without assuming any greater risk of monetary loss.

Unit Trust class

Asset Allocation – Prudential

Fund Management Fee
1.95% per annum




GE 8/2006                                        BX 111
NEDBANK MANAGED FUND

Objective

This fund aims to generate returns in excess of inflation over the long term, at below average risk levels.
In the short term, the fund aims to limit capital losses. The fund may invest across all asset classes, but
within the prudential investment guidelines. Although the fund is equity centric, it is able to hold cash,
bonds, listed property and offshore assets. The fund is ideal for investors seeking real returns over the
medium to long term.

Unit Trust class

Asset Allocation – Prudential

Fund Management Fee

2.52% per annum

INVESTEC MANAGED FUND

Objective

This fund seeks to secure stable growth of income and capital across a range of security classes in a
balanced manner, and a reasonable level of current income. The fund invests conservatively in a
spread of the key asset categories: equities, bonds and cash, with the objective of providing steady
long-term capital growth. The allocation across these asset categories is actively managed and altered
according to market conditions.

Unit Trust class

Asset Allocation – Prudential

Fund Management Fee

2.24% per annum

SANLAM BALANCED FUND

Objective

This fund invests in a wide spectrum of investments in the equity, bond, money and property markets in
order to maximize total returns over the long term.

Unit Trust class

Asset Allocation – Prudential

Fund Management Fee

1.6% per annum




GE 8/2006                                         BX 112
SANLAM MULTI MANAGED BALANCED FUND OF FUNDS

Objective

The fund invests in a portfolio of collective investments or approved international funds to seek steady
growth of capital and income. The fund is managed within moderate investment parameters.

Unit Trust class

Asset Allocation – Prudential

Fund Management Fee

1.6% per annum

FRATERS FLEXIBLE FUND

Objective

This fund aims to maximise total returns and align the investment objectives of the investor, the fund
manager and the asset management company. The fund houses the investments of Fraters'
management. The asset manager accepts a degree of market risk, but view returns in absolute terms.
As a result, this fund has been designed to operate as flexibly as possible within the constraints of the
South African market. The fund is actively managed and is able to invest in equities, fixed interest,
listed property and cash.

Unit Trust class

Asset Allocation – Flexible

Fund Management Fee

2.52% per annum

CORONATION ABSOLUTE FUND

Objective

This fund aims to achieve a total real return of 6% pa and to never lose money over a rolling 3 year
period. The fund will employ an aggressive application of the absolute philosophy whereby the equity
portion of the fund will focus on high conviction ideas and comprise a maximum of 35 shares.

Unit Trust class

Asset Allocation – Targeted Absolute and Real Return

Fund Management Fee

2.30% per annum




GE 8/2006                                        BX 113
ALLAN GRAY OPTIMAL FUND

Objective

This fund aims to provide investors with an investment alternative based on careful share selection
which aims to offer long-term absolute (i.e. positive) returns higher than those available in the money
market sector, with less risk of loss than a traditional share portfolio and with little or no correlation to the
stockmarket.

Unit Trust class

Asset Allocation – Targeted Absolute and Real Return

Fund Management Fee

1.95% per annum

PSG BALANCED FUND

Objective

This fund has a mandate to deliver a targeted return of inflation plus 3% after tax and costs, and no
negative return over any 12-month period.

Unit Trust class

Asset Allocation – Targeted Absolute and Real Return

Fund Management Fee

2.72% per annum

SANLAM DEFENSIVE FUND OF FUNDS

Objective

The fund invests in a balanced and diversified portfolio of collective investments which invests in sectors
or shares with sound growth potential in order to achieve stable income and capital growth.

Unit Trust class

Asset Allocation – Targeted Absolute and Real Return

Fund Management Fee

1.6% per annum

SANLAM INFLATION LINKED FUND

Objective

The fund invests in the flexible combination of investments in the equity, gilt and money markets, both
locally and abroad, aiming for maximum positive returns (comprising capital and income growth) over
the long term.

Unit Trust class

Asset Allocation – Targeted Absolute and Real Return

Fund Management Fee

1.6% per annum



GE 8/2006                                           BX 114
ALLAN GRAY EQUITY FUND

Objective

This fund aims to earn a higher total rate of return than that of the average of the South African equity
market as represented by the FTSE/JSE All Share index, including income, without assuming greater
risk. The fund invests in equities offering superior fundamental value. The fund manager's experience
is that equity investing based on this "value approach" offers not only higher returns over the long term,
but also less risk of loss. Superior value is determined by comparing the price of the share to its intrinsic
or underlying value. The investment approach is long-term in nature and as such the fund does not
actively participate in short-term trading.

Unit Trust class

Equity – General

Fund Management Fee

2.52% per annum

INVESTEC EQUITY FUND

Objective

This fund has as its primary objective steady growth of income and capital and a reasonable level of
current income and stability for capital invested. Its mandate is not restrictive and the fund invests in
both growth and value companies. The fund is committed to offering investors top-quartile, longer-term
performance. Through a robust investment process, the portfolio will focus on established companies,
as well as companies with superior growth potential that is not yet recognised by the market.

Unit Trust class

Equity – General

Fund Management Fee

2.24% per annum

INVESTEC CAUTIOUS MANAGED FUND

Objective

The fund aims to provide investors with returns in excess of inflation comprising both capital and income
over the medium term. It will achieve this by diversifying across various asset classes, including
equities, bonds, cash and listed property. The moderate to low risk profile will be achieved by typically
limiting the equity exposure to 40% and using a value biased equity investment philosophy.

The low risk of capital loss will appeal to conservative investors. It can also be used as a core portfolio
holding around which more risky investments are added.

Unit Trust class

Asset Allocation – Prudential

Risk level

Cautious

Fund Management Fee

2.30% per annum




GE 8/2006                                         BX 115
CORONATION EQUITY FUND

Objective

This fund seeks to generate long-term capital growth by investing in selected growth and undervalued
shares. The fund's emphasis is on active stock selection and endeavours to be fully invested in equities
at all times.

Unit Trust class

Equity – General

Fund Management Fee

2.30% per annum

CORONATION OPTIMUM GROWTH FUND

Objective

This fund aims to deliver long-term growth by investing in a combination of local and international
investments across all asset classes.

Unit Trust class

Asset Allocation – Flexible

Risk level

Moderate

Fund Management Fee

2.00% per annum

NEDBANK RAINMAKER FUND

Objective

This fund aims to achieve superior medium- to long-term capital growth through careful stock selection
and exposure to selected themes within the equity market, both locally and abroad.

Unit Trust class

Equity – General

Fund Management Fee

2.52% per annum




GE 8/2006                                       BX 116
OASIS CRESCENT EQUITY FUND

Objective

This fund provides investors with the opportunity to invest in listed equities on both local and
international stock exchanges within the ethical parameters of Shari’ah-governed investment. The fund
is a Shari’ah compliant collective investment scheme that adheres to the ethical investment guidelines
that are prescribed by the Dow Jones Islamic Market index. As a medium to high-risk investment
vehicle, the primary objective of this fund is the protection and growth of investor capital through the
application of stringent stock selection criteria to the investment process. The fund’s portfolio is
managed in accordance with the Oasis investment philosophy of low volatility fund management that
seeks to provide superior returns at lower than market risk.

Unit Trust class

Equity – General

Fund Management Fee

2.52% per annum

PSG ALPHEN EQUITY FUND OF FUNDS

Objective

This is a general equity fund of funds, with the primary objective to seek maximum returns for investors
within an acceptable level of risk. It will invest primarily in a range of participatory interests or any other
form of participation in portfolios of collective investment schemes or other similar schemes with a
variety of investment policies which are characterised as being of an equity nature.

Unit Trust class

Equity – General

Fund Management Fee

2.05% per annum

SANLAM GENERAL EQUITY FUND

Objective

The fund seeks maximum capital growth over the medium to long term by investing in selected shares
across all the major sectors of the JSE. This fund is suitable for investors wanting a well-balanced
portfolio and do not have expert knowledge of the stock exchange.

Unit Trust class

Equity – General

Fund Management Fee

1.6% per annum




GE 8/2006                                          BX 117
SANLAM MULTI MANAGED EQUITY FUND OF FUNDS

Objective

The fund invests in a portfolio of collective investment schemes in order to secure growth of capital for
its unitholders over the long term. The fund will invest predominantly in selected sector and theme
funds in order to maximise returns. The fund is ideally suited to the investor striving for optimum capital
growth through an investment in a wide range of unit trusts focusing strongly on aggressive capital
growth. Investors in this fund should be willing to accept a higher though calculated risk.

Unit Trust class

Equity – General

Fund Management Fee

1.6% per annum

SANLAM VALUE FUND

Objective

The fund has the primary objective of growth, by investing in a medium with a reasonable level of
current income and relative stability for capital. The fund focuses on achieving this objective by
investing in financially sound companies which offer exceptional value. These include shares with a low
price to earnings ratio, shares trading at a discount to their net asset value, and shares whose prices do
not reflect future earnings potential.

Unit Trust class

Equity – Value

Fund Management Fee

1.6% per annum

SANLAM SMALL CAP FUND

Objective

This fund is managed actively and aggressively in order to achieve maximum capital appreciation in the
medium to long term. The focus is on small to mid capitalisation companies with above average growth
potential and that have been mispriced by the market. The asset manager’s pragmatic value approach
emphasises the importance of minimising any downside risk, while maximising the contribution from
stock selection. This fund is suited for clients who are seeking exceptional growth potential in the longer
term and are prepared to accept a higher degree of risk.

Unit Trust class

Specialist Funds

Fund Management Fee

1.6% per annum




GE 8/2006                                         BX 118
SANLAM FINANCIAL FUND

Objective

This fund offers investors an opportunity of investing in the financial services industry. The fund aims to
achieve superior returns over the medium to long term through well researched superior stock selection.
The fund is suitable for clients requiring greater exposure to financial shares as part of a balanced
portfolio.

Unit Trust class

Specialist Funds

Fund Management Fee

1.6% per annum

SANLAM INDUSTRIAL FUND

Objective

The fund seeks capital growth by investing in selected shares in the industrial sector. This fund is suited
for clients requiring larger exposure to industrial shares, with the associated capital growth this sector is
able to offer.

Unit Trust class

Specialist Funds

Fund Management Fee

1.6% per annum

SANLAM INTERNATIONAL DEFENSIVE FUND OF FUNDS

Objective

This fund has a diversified portfolio in terms of asset classes and has a high exposure in less volatile
asset classes such as cash and fixed interest securities. The fund is suitable for investors that want to
invest in international markets but choose to do so through a less volatile and lower risk option. It aims
to provide investors with long term capital preservation and capital growth qualities in dollar terms.

Unit Trust class

Global Funds

Fund Management Fee

2.48% per annum




GE 8/2006                                         BX 119
SANLAM ABSA POSITIVE RETURN FUND

Objective

The fund is a flexible asset allocation fund aimed at long-term capital growth while protecting the
investor’s funds. The fund aims to provide returns superior to that of money market funds, over a rolling
12-month period by locking in high yields on the bond market and investing in equities.

The fund is suitable for investors who seek capital growth superior to money market funds. It is
appropriate for risk averse clients who want to participate in rising markets and require protection in
declining markets.

Unit Trust class

Asset allocation – targeted absolute and real return

Fund Management Fee

2.05% per annum

ABSA BALANCED FUND

Objective

This prudential fund has a diversified investment portfolio to ensure an optimum mix of security, return
and growth. Funds are invested in top quality JSE-listed shares in all sectors of the exchange, quoted
property trusts, gilts and interest-bearing investments. In line with prudential requirements this fund's
exposure to equities does not exceed 75%. The remainder is split between cash and capital market
instruments.

Unit Trust class

Asset allocation – Prudential

Fund Management Fee

2.52% per annum

ABSA SELECT EQUITY FUND

Objective

The fund invests in shares on the stock exchange with the intention of providing investors with long-term
capital growth and escalating dividend income. Exposure to equities typically exceeds 75% of the fund
and comprises a diverse combination of shares selected, following independent research.

Unit Trust class

Equity – general

Fund Management Fee

2.52% per annum




GE 8/2006                                        BX 120
SANLAM GLOBAL BEST IDEAS FUND

Objective

The fund aims to provide above average long-term capital growth by investing in global equities that the
investment manager has identified as being undervalued and offering above average growth potential.
The fund invests in undervalued stocks with the search focus on undiscovered or neglected stocks.

This fund is a relatively high risk fund in relation to other asset classes due to its equity based
investment approach. However, the fund manager aims to reduce the overall risk by his value and
fundamental stance.

Unit Trust class

Global funds

Fund Management Fee

1.80% per annum

OLD MUTUAL DYNAMIC FLOOR FUND

Objective

This fund strives for long-term capital growth as well as some level of capital protection. Through the
use of a quantitative risk model, the fund aims to profit from a rising share market and protect against
capital losses in a weak market. The fund invests across shares, bonds and cash – moving from shares
into fixed interest investments when the fund's value drops below a predetermined "floor". When
markets start to move up, the fund increases its holdings in shares, tapping into these growth
opportunities. The fund aims to protect at least 90% of the net investment over a 12-month period.

The fund is ideally suited to the more risk-averse investor whose priority is capital preservation but who
still wants to participate in upside market growth.

Unit Trust class

Asset Allocation – Targeted Absolute real return

Risk level

Cautious

Fund Management Fee

2.15% per annum




GE 8/2006                                          BX 121
OLD MUTUAL ENHANCED INCOME FUND

Objective

The fund aims to offer a relatively high sustainable level of income and as well as seeking opportunities
to maximise capital gains. Income is derived from a range of interest-bearing assets, including
exposure when appropriate to listed property shares. Capital growth is generated from exposure to
bonds and property shares.

The fund is suitable for investors needing a relatively high level of income together with some capital
appreciation. These are investors who are able to live with volatility in income distribution levels.

Unit Trust class

Fixed interest – Varied specialist

Risk level

Conservative

Fund Management Fee

1.87% per annum

FOORD EQUITY FUND

Objective

The objective of the fund is to earn a higher total rate of return than that of the average of the South
African equity market as represented by the FTSE/JSE All Share index including income, without
assuming greater risk.

Unit Trust class

Equities – General

Asset class

Equity

Fund Management Fee

2.52% per annum

KRUGER PRUDENTIAL FUND OF FUNDS

Objective

The fund invests in a balanced and diversified portfolio of collective investments which invests in sectors
or shares with sound growth potential in order to achieve stable income and capital growth. The fund is
diversified across the major asset classes.

The fund aims to provide investors with positive returns in excess of inflation (CPIX + 3%) over the long
term and positive returns over any 12 month period.

This fund is a prudential fund (Regulation 28) and is thus ideally suited to the cautious investor wanting
to save for e.g. retirement. The fund is suited for any investor wanting to earn a real return.

Unit Trust class

Asset allocation - Prudential

Fund Management Fee

1.60% per annum


GE 8/2006                                         BX 122
KRUGER FLEXIBLE FUND OF FUNDS

Objective

The fund invests in a balanced and diversified portfolio of collective investments which invests in sectors
or shares with sound growth potential in order to achieve stable income and capital growth. The fund is
diversified across the major asset classes.

The fund aims to provide investors with positive returns in excess of inflation (CPIX + 5%) over any 24
month period, with a capital growth focus.

This fund is a flexible fund and is thus ideally suited to a moderate investor wanting to earn a real return.

Unit Trust class

Asset allocation - Flexible

Fund Management Fee

1.60% per annum

NB:
•   Offshore and Global funds are not currently available for Retirement Annuities, preservation
    fund policies and provident fund policies.
•   The Absa Select Equity Fund is not available for provident funds




GE 8/2006                                          BX 123
2.        AVAILABILITY OF PRICES
For all Offshore and International Funds, as well as the Multi-Manager Balanced Fund (High Equity), the
actual price on a specific day is known only two working days later. For all other investment funds the
actual price on a specific day is known on the following day.

3.        SWITCHING AND REDIRECTIONS
•    A member can switch between investment funds at any time.
•    The first two switches between investment funds each year are currently free. For the third and
     further switches in the same policy year, Sanlam Life currently charges an administration fee of
     R375,00 for each switch. Switches are made at the selling prices of the funds from and to which the
     switches are made.
•    Depending on the investment fund from which or to which the switch is done, Sanlam Life will also
     charge a switching fee for each switch during a policy year. At present, no switching fee is payable,
     except when a switch is done to the any of the Offshore Funds. For these cases Sanlam Life
     currently charges a switching fee of 1%. This switching fee is charged on each switch, including the
     first and second in a policy year.

Sanlam Life can at any stage start charging switching fees in cases where such fees are not yet
charged, and also change the fee of 1%.

4.        INVESTMENT GUARANTEES
The following investment guarantees are available:

             Absolute Return Fund (CPIX + 3%)                     :   0% guarantee
             Multi Manager Absolute Return Fund (CPIX + 3%)       :   0% guarantee
             Absolute Return Fund (CPIX + 5%)                     :   0% guarantee
             Multi Manager Absolute Return Fund (CPIX + 5%)       :   0% guarantee
             Balanced Fund (Low equity)                           :   0% and 3% guarantee
             Multi Manager Balanced Fund (Low equity)             :   0% and 3% guarantee

The guaranteed amount of each investment fund on which a guarantee was selected, is equal to the
amounts allocated to that investment fund, less the difference between the buying and selling price,
accumulated each year by the chosen guaranteed rate (3% or 0%).

The investment guarantee only applies on the investment guarantee date(s), or on the date on which we
receive notice of the death of the life insured, if earlier. If the value of the policy investment in an
investment fund is then less than the guaranteed amount of that investment fund, we will add more units
to the policy investment in that investment fund, to give the value required.

If the amount of an investment fund with guarantees is reduced because of an alteration, the guaranteed
amount of the investment fund will be reduced accordingly.

On the investment guarantee date, the value of the policy is the greater of the sum of the units multiplied
by the price, or the investment guarantee. On any other day, the value of the policy is always equal to
the units multiplied by the price. If the investment guarantee date is before the option date and Sanlam
Life still offers this investment guarantee in the economic environment on the investment guarantee
date, the investment guarantee will continue beyond the investment guarantee date. Currently, if the
option date is 15 years or less after the investment guarantee date, the new investment guarantee date
will be equal to the option date. However, if the option date is more than 15 years after the investment
guarantee date, the new investment guarantee date will be 10 years after the current investment
guarantee date.

If an investment in an investment fund for which a investment guarantee was chosen, should be
increased within 60 months before an investment guarantee date, Sanlam Life will charge a participation
fee. The amount of the fee is determined at the time of such an increase.




GE 8/2006                                         BX124
INVESTMENT GUARANTEES (continued)

An investment guarantee cannot be added after the policy’s inception. Should the policy investment
ever be switched from an investment fund for which an investment guarantee has been chosen, or
withdrawn from this investment fund, the investment guarantee will be cancelled, except when the
savings premiums (if applicable) are still being allocated to this (these) investment fund(s) at that stage.

NB: The investment guarantee rate of 0% or 3% applies to new business. For policies already
    issued with another investment guarantee rate, the investment guarantee rate that applied
    when the policy was issued, will apply.

5.        ENDOWMENT OPTION FOR                               RETIREMENT ANNUITIES                         AND
          PRESERVATION FUNDS
An endowment option is available in the case of retirement annuities / preservation funds by means of
which you can assist your clients who contribute towards retirement annuity funds / preservation funds,
to use their retirement capital in a tax effective manner and thus also obtain an after-tax income.

Benefits for the member

This option offers the member several benefits:

•    The member need not immediately decide on the reinvestment of his or her retirement money.
•    He or she can choose from all the available Stratus investment funds, and can easily switch between
     these investment funds.
•    His or her money in the continued policy is available at any time.
•    Sanlam Life pays tax on any investment growth. As a result, he or she receives benefits on which
     he or she is not taxed again. On benefits received from the policy ceded to him/her (see Tax below).
•    The member can at any time pay back the loan.

How the option works

When the member applies for early retirement from the relevant retirement annuity fund / preservation
pension fund, or when the retirement annuity / preservation fund policy has reached maturity, the
member has the option to take one-third of the available retirement capital (after deduction of tax) in
cash and use the remainder for a compulsory life annuity.

It works like this:

•    The member requests the Fund to make a loan against the policy.
•    The Fund applies to Sanlam Life for an interest-free loan equal to the full maturity value.
•    Sanlam Life pays the loan amount to the Fund.
•    The member applies to the Fund for an outright cession of the policy.
•    The member cedes the policy to Sanlam Life as security for the loan made by the Fund.
•    The full policy will continue as a Stratus Continuation with life assured, with a loan against it.
•    The Fund pays the member the lump sum (less tax) and buys a life annuity for life on the member's
     life.
•    The member uses the lump sum paid to him by the Fund, to reduce the loan amount.
•   The member can at any stage pay back the rest of the loan against the policy. The policy remains
    liquid.
The member can make regular cash withdrawals from the policy if preferred. Thus he or she will then –
aside from the compulsory life annuity – also receive a regular after-taxed amount.




GE 8/2006                                            BX125
ENDOWMENT OPTION FOR RETIREMENT ANNUITIES AND PRESERVATION FUNDS (continued)

Criteria that the retirement annuity / preservation fund policy must comply with

•     After the cession there must not be a restricted period because of a premium increase more than
      20% within the last 5 years.
•     The minimum continuation amount (before deduction of the loan amount) is at present R300 000.
      The total value of the policy that is continued, must therefore be at least R300 000.

Recurring premiums
No recurring premiums are permitted.

Tax
The policy is not subject to CGT, because paragraph 55(d) of the 8th Schedule of the Income Tax Act
exempts it from CGT.

6.         STRATUS LIFETIME INVESTMENT OPTION
Description

Although clients today are much more informed about investments than in the past, many of them don’t
have the necessary knowledge or inclination to switch their investments from one investment fund to
another. Particularly in the case of retirement annuities with longer terms, a facility is required where the
distribution of underlying investments is managed expertly for the duration of the policy. Sanlam Life will
be making such a facility available with Stratus Retirement Annuity and Stratus policies with
preservation funds.

Stratus Lifetime Investment Option is an automatic switching facility that gives members the peace of
mind that the investments being held for their benefit in a Stratus Retirement Annuity, or Stratus policies
with preservation funds, are being managed effectively at all times. It gives the client the option of
choosing an investment strategy when taking out the policy – after which it ensures that the investment
is invested in suitable investment funds, depending on the member’s risk profile and age. Close to
retirement, the investment is therefore gradually moved from more volatile investments to more stable
ones. These moves take place automatically.

Benefits for the client

•     By adding this option to the policy, clients reduce the risk of losing a large amount of their capital
      close to retirement.
•     Clients do not have to study the market themselves to make investment decisions.
•     The option provides a facility that makes it easier for the intermediary to meet the investment profile
      of his client.

The facility therefore gives clients peace of mind for the duration of the policy.

Lifetime investment options available

Initially, three programmes will be available, two of which make provision for different risk categories.
Only one programme can be chosen for each policy.

The three programmes are:

    Sanlam Aggressive               This programme gives the client, for longer periods, increased
    Lifetime Investment Option      exposure to equity and offshore investment funds, as well as
                                    diversification in investment funds such as offshore hedge funds and
                                    absolute return funds.
    Sanlam Moderate Lifetime        The Sanlam Moderate Lifetime Investment Option offers less exposure
    Investment Option               to equity and offshore investment funds, with a large portion of the
                                    investment in the Vesting Bonus Fund.
    Absa Lifetime Investment        For this programme, the combination of investment funds was
    Option (only available for      compiled in conjunction with Absa, according to their own view.
    Absa brokers)



GE 8/2006                                           BX126
This is what the proposed asset allocations for the Sanlam options look like:



                                        Aggressive Life Time Option

                         100%
    Fund allocation



                          80%
                          60%
                          40%
                          20%
                           0%
                            30
                                 33
                                       36
                                            39
                                                 42
                                                      45
                                                           48
                                                                51
                                                                     54
                                                                           57
                                                                                60
                                                                                     63
                                                                                          66
                                                                                               69
                                                                 Age

                       Sanlam Equity                           MM Equity
                       Bond                                    Property
                       MM Absolute Return (CPIX+5%)            Guaranteed Capital


                                            Moderate Life Time Option

                         100%
    Fund allocation




                          80%
                          60%
                          40%
                          20%
                           0%
                                                                                               69
                                                      45
                                                           48


                                                                     54
                                                                           57




                                                                                          66
                            30
                                 33
                                       36
                                            39
                                                 42




                                                                51




                                                                                60
                                                                                     63




                                                                 Age

                      Sanlam Equity              Multi-Manager Equity      Vesting Bonus
                      Bond                       Property                  Guaranteed Capital

The graphs indicate how the degree of risk decreases closer to retirement if the Lifestyle Investment
Option has been chosen.

All proposed asset allocations can be revised and adjusted from time to time.




GE 8/2006                                              BX127
Minimum premium

If the Lifetime Investment Option is chosen, the minimum savings premium for retirement annuities with
recurring premiums is presently R300 per month or R3 600 per annum. This also applies if the Stratus
RA is taken as part of a Stratus and Matrix combination product. The normal minimum single premiums
apply for single-premium policies.

Minimum term

If the Vesting Bonus Fund is part of the selected programme – as with the Sanlam Moderate Lifetime
Investment Option – a minimum initial term of five years applies. If the facility is added to an existing
policy and the Vesting Bonus Fund is part of the selected programme, the outstanding term must also
be at least five years.

Amendments

The following amendments will be permitted:

•   addition of the programme to an existing policy
•   switching from one programme to another
•   removal of the facility

No costs are involved in any of the above amendments.

If the option is selected with a new policy, or if it is added to a policy at any stage, the fund distribution
as on the client’s next birthday will be taken into account if the client’s birthday is within six months from
the quotation date (in the case of new business) or the effective date (in the case of an addition). It will
therefore not be necessary to adjust the investment funds within six months after the inception date or
the effective date of the addition.

Switches

Any switched programme made in terms of the Lifetime Investment Option is free – irrespective of the
number of switches made.

If at any stage the client initiates a switch on a policy on which the Lifetime Investment Option has been
chosen, the facility is automatically cancelled and the normal switching rules apply.

No regular switches will be made at younger ages while the proposed asset allocations remain
unchanged. When they start changing, switches will take place annually.

Investment performance

Although the objective of the Lifestyle Investment Option is mainly to reduce investment risks, it
does not completely exclude the possibility of capital loss. The option also does not guarantee
an above-average investment performance.




GE 8/2006                                          BX128
D.        STRATUS RIDER BENEFITS

    WAIVER OF PREMIUM AT DISABILITY (OPG, OGG)

Waiver of premium without future growth at disability and waiver of premium with future growth at
disability are waiver of premium benefits in the case of disability of the relevant life insured or the
member. When a disability claim is admitted, Sanlam Life will waive the payment of recurring premiums
on the policy on which the benefit was taken. This means Sanlam Life will treat the future premiums as
having been paid when payment becomes due.

These rider benefits are available in the case of the following Stratus products with savings premiums:
•    Stratus Endowment
•    Stratus Retirement Annuity
•    Stratus EduFocus

In this chapter, where further reference is made to the “insured”, the same will apply to the member (in
the case of the Stratus Retirement Annuity).

OPG AND OGG

OPG      – waiver of premium without future growth at disability
OGG      – waiver of premium with future growth at disability

A claim will be considered for recognised disability, personal disability, and/or if the insured is
unable to follow his/her regular occupation.
After 24 months (after a claim has been admitted), the insured must also be unable to follow an
alternative occupation in order to have the claim continue.

DEFINITIONS

OPG      :   In the case of policies with premium growth, the premium will grow until a claim arises. The
             premium growth will cease when a waiver of premium claim has been admitted.
OGG      :   The premium will grow before and after a waiver of premium claim has been admitted. After
             a claim has been admitted, growth in terms of OGG will take place at the current inflation
             rate, with a maximum of 15% a year. Should premium growth be cancelled, no further
             growth in terms of OGG will take place, and when a claim is admitted, the level premium (as
             payable at that stage) will be waived.

AVAILABILITY

This benefit is available for new business as well as conversions:

OPG      : OPG is available as rider benefit on policies with or without premium growth.
OGG      : OGG is available as rider benefit only on policies with inflation premium growth.
All occupational classes and rate groups qualify for this rider benefit. See Section BZ for information
regarding occupational underwriting.

AGE AT ENTRY

15 to 60 next birthday (for women as well)




GE 8/2006                                         BX129
BENEFIT TERM

The benefit term is the shortest of
•   the term up to the option date, and
•   the term up to policy anniversary before or on age 65.

RATES

OPG or OGG benefits must be taken on the full premium. Rates are a percentage of the recurring
premium of the policy after the collection premium has been deducted (if applicable). Sanlam Life may
change this percentage from time to time.

RENEWAL OF WAIVER OF PREMIUM BENEFIT

Before the cover end date, and subject to our new business requirements at the time, the cover for the
benefit can be extended on request, if the life insured is still alive. However, Sanlam Life will not extend
cover for the benefit if, during the year ending at midnight before the cover end date, a claim for a waiver
of premium benefit for the life insured was submitted to Sanlam Life, or Sanlam Life waived the payment
of a premium.

The rate payable at renewal of the benefit is determined by the following:
    −   age next birthday on the renewal date, and
    −   age next birthday at the end of the new benefit term.

TERM OF BENEFIT PAYMENTS

Sanlam Life will begin to waive payment of the recurring premium from the date on which the disability
claim is admitted, or from the end of the waiting period, whichever date is the latest.

Sanlam Life will waive payment of the recurring premium for as long as the disability continues, but only
up to midnight before the cover end date. From the cover end date, payment of the recurring premium
must be resumed.

If the disability claim is admitted because the life insured, as a result of the disability, is unable to fulfil
the occupational demands of the occupation he engaged in for income immediately before becoming
disabled, Sanlam Life will waive payment of the recurring premium for 24 months only. Thereafter,
Sanlam Life will only continue waiving payment of the recurring premium if the life insured is also unable
to fulfil the occupational demands of another occupation which Sanlam Life may reasonably expect of
him to engage in despite his disability, taking into account his education, training and experience.

WAITING PERIOD

The waiting period is currently 6 months from the date on which the disability claim has been received.
In future this waiting period also applies if the disability claim is based on a mental or back condition.
Sanlam Life may change this waiting period from time to time.

The waiting period is waived for insureds who are terminally ill.

Should Sanlam Life, by the time that the waiting period has expired, still not have received all medical
and other evidence required by Sanlam Life with regard to the disability, Sanlam Life will only consider
the disability claim after such evidence has been received.




GE 8/2006                                           BX130
CIRCUMSTANCES UNDER WHICH A DISABILITY CLAIM WILL BE ADMITTED

Sanlam Life will admit a claim if the life insured becomes disabled, and the disability amounts to one of
the following:

•   total, permanent and irrecoverable loss of
    −   the vision in two eyes, or
    −   the use of two hands, or
    −   the use of two feet, or
    −   the use of one hand and one foot,
•   functional impairment to the extent that the life insured is
    −   totally, permanently and continuously unable to take care of his or her body or personal interests,
        or
    −   totally and continuously unable to fulfil the occupational demands of the occupation he or she
        engaged in for income immediately before the functional impairment, resulting in a loss of such
        income.

Besides the other conditions for admittance of a claim, Sanlam Life will admit a claim only if the disability

•   is caused directly and solely by a bodily injury or by an illness;
•   lasted continuously for the entire waiting period.

TEMPORARY EXCLUSIONS FOR SPECIFIC CONDITIONS

During the first three years after cover for the benefit has started, Sanlam Life will not admit a claim if
the disability of the life insured directly or indirectly resulted from any of the following:

•   depression or dysthymia, whether as an episode or disorder, or as part of the symptom complex of
    another psychiatric diagnosis;
•   post traumatic stress disorder;
•   fibromialgia;
•   chronic fatigue syndrome and its synonyms;
•   a back condition, unless it qualifies as one of the following:
    −   paraplegia;
    −   quadruplegia;
    −   malignant tumours of the spinal cord and vertebral column;
    −   failed back syndrome after multiple spinal surgery, provided that the extent of the functional
        impairment arising therefrom is verified by a specialist that Sanlam Life will nominate;
•   an injury or illness that directly or indirectly resulted from, or is traceable to, any of the above causes;
•   a complication that directly or indirectly is attributable to any of the above causes, or to such an
    injury or illness;
•   a side-effect of treatment for any of the above causes, or for such an injury or illness, or for such a
    complication.

The definitions for these conditions appear in the contracts. Three years after waiver of premium with or
without future growth at disability takes effect, any back condition and psychiatric conditions that causes
the life insured to experience disability as defined in the policy contract, is covered. All psychiatric
conditions other than those mentioned above are covered from the inception date of the disability
benefit.

It is, however, possible that a particular life insured's specific situation may necessitate these conditions
being excluded permanently.




GE 8/2006                                           BX131
PROOF THAT DISABILITY CONTINUES

While payment of the recurring premium is being waived, Sanlam Life may from time to time ask for
proof that the life insured is still disabled. Sanlam Life may require the life insured to be examined for
this purpose at Sanlam Life's cost. If the life insured recovers to such an extent that he or she is no
longer disabled, Sanlam Life will stop waiving payment of the recurring premium.

Sanlam Life will also stop waiving payment of the recurring premium if

•   Sanlam Life does not receive the required proof of the life insured's continued disability, or
•   the life insured
    −   refuses to be examined, or
    −   refuses to undergo reasonable treatment on a regular basis, at his or her cost, by a medical
        doctor, other than the life insured if he or she is a medical doctor, or
    −   dies

If Sanlam Life stop waiving payment of the recurring premium, payment of recurring premiums must be
resumed.

RESUMPTION OF PREMIUMS OR CONTRIBUTIONS

If the insured recover, the benefit will cease and the policyholder will have to resume payment of the
premiums.

ALTERATIONS

OGG may be changed to OPG. OPG, and vice versa.




GE 8/2006                                          BX132
    WAIVER OF PREMIUM AT DEATH (DP, DG)

Waiver of premium with future growth at death (DG) as well as waiver of premium without future growth
at death (DP) is available. If a claim is admitted, payment of premiums of the policy will be waived. This
means Sanlam Life will treat the future premiums as having been paid when payment becomes due.

DP AND DG

DP – waiver of premium without future growth at death
DG – waiver of premium with future growth at death

PREMIUM GROWTH

Premium growth is available according to the choice of growth selected by the policyholder. If DG is
taken, the policy MUST have future premium growth at consumer price index (CPI).

Waiver of premium with future growth at death (DG)

After a claim is admitted, the premiums will continue to increase each year at the rates as set out in the
policy.

If premium growth is ceased before a claim has been admitted, the benefit will be changed to waiver of
premium without future growth at death (DP). This means that, if a claim is admitted, the premiums will
not be increased anymore.

Waiver of premium without future growth at death (DP)

After a claim is admitted, there will be no regular increases in premiums.

INCEPTION AGES

    •   Minimum     :   15 age next birthday
    •   Maximum     :   65 age next birthday

BENEFIT TERM

The benefit term is the shortest of

•   the term up to the option date
•   the term up to the policy anniversary just before or on age 80

QUALIFYING LIVES

Persons who qualify for rate groups 2, 3, 4 and 5 can apply for waiver of premium at death benefits.

RATE DIFFERENTIATION

There is only one set of rates for each benefit. At present there is no differentiation on the grounds of
rate group, smoking habits or sex.

LIMITS

None (subject to financial underwriting).

DURATION OF PREMIUM WAIVING

Payment of the premiums is waived up to midnight before the cover end date. Thereafter payment of
premiums must be resumed.




GE 8/2006                                         BX133
EXCLUSIONS

Sanlam Life will not admit a claim if death is caused by suicide, also during insanity, committed within 24
months after cover for the benefit has started, or after the policy has been re-instated after an earlier
lapse. The person or entity who claims the benefit, must prove that the life insured did not commit
suicide.

AMENDMENTS

DG can be changed to DP, and vice versa.




GE 8/2006                                         BX134
E.      SUMMARIES
1.      AVAILABLE INVESTMENT FUNDS PER PRODUCT

Ordinary insurance (non-retirement business)

                                                                                                            Continuations
                                                      Endowment   International                                             Traded
                                                                                                               with or
                                                                   Endowment      EduFocus   Sinking Fund
                                                        policy                                                 without      policies
                                                                      policy
                                                                                                             insured life
RAND-DENOMINATED FUNDS
Managed options – onshore
Absolute Return Fund (CPIX + 3%)                          x                          x            x               x            x
Multi-Manager Absolute Return Fund (CPIX + 3%)            x                          x            x               x            x
PPS Multi-Manager Inflation + 3%
Absolute Return Fund (CPIX + 5%)                          x                          x            x               x            x
Multi-Manager Absolute Return Fund (CPIX + 5%)            x                          x            x               x            x
PPS Multi-Manager Inflation + 5%
Vesting Bonus Fund                                        x                          x            x               x            x
Balanced Fund (Low Equity)                                x                          x            x               x            x
Multi-Manager Balanced Fund (Low Equity)                  x                          x            x               x            x
PPS Multi-Manager Inflation + 8%
Balanced Fund (Medium Equity)                             x                          x            x               x            x
Multi-Manager Balanced Fund (Medium Equity)               x                          x            x               x            x




GE 8/2006                                     BX135
Ordinary insurance (non-retirement business)(continued)

                                                                                                             Continuations
                                                       Endowment   International                                             Traded
                                                                                                                with or
                                                                    Endowment      EduFocus   Sinking Fund
                                                         policy                                                 without      policies
                                                                       policy
                                                                                                              insured life
RAND-DENOMINATED FUNDS (continued)
Managed options – onshore (continued)
Balanced Fund (High Equity)                                x                          x            x               x            x
Multi-Manager Balanced Fund (High Equity)                  x                          x            x               x            x
Guaranteed Property Fund (only available for Stratus
Guaranteed Property investment)
PPS Enhanced Cash Fund
Active building blocks – onshore
Guaranteed Capital Fund                                    x                          x            x               x            x
Bond Fund                                                  x                          x            x               x            x
Property Fund                                              x                          x            x               x            x
Sanlam Equity Fund                                         x                          x            x               x            x
Multi-Manager Equity Fund                                  x                          x            x               x            x
Managed options – offshore
Offshore Hedge Fund                                        x                          x            x               x            x
Offshore Balanced Fund                                     x                          x            x               x            x




GE 8/2006                                     BX136
Ordinary insurance (non-retirement business)(continued)

                                                                                                    Continuations
                                              Endowment   International                                             Traded
                                                                                                       with or
                                                           Endowment      EduFocus   Sinking Fund
                                                policy                                                 without      policies
                                                              policy
                                                                                                     insured life
RAND-DENOMINATED FUNDS (continued)
Active building blocks – offshore
Offshore Money Market Fund ($)                    x                          x            x               x            x
Offshore Money Market Fund (£)                    x                          x            x               x            x
Offshore Money Market Fund (€)                    x                          x            x               x            x
Offshore Bond Fund                                x                          x            x               x            x
Offshore Property Fund                            x                          x            x               x            x
Offshore Equity Fund                              x                          x            x               x            x
USA$-, £- AND €-DENOMINATED FUNDS
Managed options – offshore
International Hedge Fund                                       x
International Balanced Fund                                    x
Active building blocks – offshore
International Money Market Fund ($)                            x
International Money Market Fund (£)                            x
International Money Market Fund (€)                            x
International Bond Fund                                        x
International Equity Fund                                      x
International Property Fund                                    x




GE 8/2006                             BX137
Retirement business

                                                                                                     Continuations
                                                              Continua-   Continua-                                              Continuations
                                             Interna-   PPS                           Preservation         of        Provident
                                     RA                        tions of    tions of                                               of Provident
                                            tional RA   RA                               Funds       Preservation     Funds
                                                                 RAs      PPS RAs                                                    Funds
                                                                                                        Funds
RAND-DENOMINATED FUNDS
Managed options – onshore
Absolute Return Fund (CPIX + 3%)     x                   x        x           x            x               x             x             x
Multi-Manager Absolute Return Fund
(CPIX + 3%)                          x                            x                        x               x             x             x
PPS Multi-Manager Inflation + 3%                         x                    x
Absolute Return Fund (CPIX + 5%)     x                   x        x           x            x               x             x             x
Multi-Manager Absolute Return Fund
(CPIX + 5%)                          x                            x                        x               x             x             x
PPS Multi-Manager Inflation + 5%                         x                    x
Vesting Bonus Fund                   x                   x        x           x            x               x             x             x
Balanced Fund (Low Equity)           x                   x        x           x            x               x             x             x
Multi-Manager Balanced Fund (Low
Equity)                              x                            x                        x               x             x             x
PPS Multi-Manager Inflation + 8%                         x                    x
Balanced Fund (Medium Equity)        x                   x        x           x            x               x             x             x
Multi-Manager Balanced Fund
(Medium Equity)                      x                            x                        x               x             x             x
Balanced Fund (High Equity)          x                   x        x           x            x               x             x             x




GE 8/2006                                 BX138
Retirement business (continued)

                                                                   International
                                            Investment Linked
                                                                Investment Linked   Composite Annuity
                                                 Pension
                                                                     Pension
RAND-DENOMINATED FUNDS (continued)
Managed options – onshore
Absolute Return Fund (CPIX + 3%)                     x                                      x
Multi-Manager   Absolute   Return    Fund
(CPIX + 3%)                                          x                                      x
PPS Multi-Manager Inflation + 3%
Absolute Return Fund (CPIX + 5%)                     x                                      x
Multi-Manager   Absolute   Return    Fund
(CPIX + 5%)                                          x                                      x
PPS Multi-Manager Inflation + 5%
Vesting Bonus Fund                                   x                                      x
Balanced Fund (Low Equity)                           x                                      x
Multi-Manager   Balanced      Fund   (Low
Equity)                                              x                                      x
PPS Multi-Manager Inflation + 8%
Balanced Fund (Medium Equity)                        x                                      x
Multi-Manager Balanced Fund (Medium
Equity)                                              x                                      x
Balanced Fund (High Equity)                          x                                      x




GE 8/2006                                    BX139
Retirement business (continued)

                                         Interna-         Continua-   Continua-                  Continuations                 Continuations
                                    RA              PPS                           Preservation                     Provident
                                          tional           tions of    tions of                  of Preservation                of Provident
                                                    RA                               Funds                          Funds
                                            RA               RAs      PPS RAs                         Funds                        Funds
RAND-DENOMINATED FUNDS (continued)
Managed options – onshore (continued)
Multi-Manager Balanced Fund (High
Equity)                             x                         x                        x                x              x             x
Guaranteed Property Fund (only
available for Stratus Guaranteed
Property investment)
PPS Enchanced Cash Fund                              x                    x
Active building blocks – onshore
Guaranteed Capital Fund             x                         x                        x                x              x             x
Bond Fund                           x                x        x           x            x                x
Property Fund                       x                x        x           x            x                x
Sanlam Equity Fund                  x                x        x           x            x                x
Multi-Manager Equity Fund           x                         x                        x                x
Managed options – offshore
Offshore Hedge Fund
Offshore Balanced Fund




GE 8/2006                                BX140
Retirement business (continued)

                                                                  International
                                           Investment Linked
                                                               Investment Linked   Composite Annuity
                                                Pension
                                                                    Pension
RAND-DENOMINATED FUNDS (continued)
Managed options – onshore (continued)
Multi-Manager Balanced Fund (High
Equity)                                             x                                      x
Guaranteed Property Fund (only available
for Stratus Guaranteed Property
investment)
PPS Enchanced Cash Fund
Active building blocks – onshore
Guaranteed Capital Fund                             x                                      x
Bond Fund                                           x                                      x
Property Fund                                       x                                      x
Sanlam Equity Fund                                  x                                      x
Multi-Manager Equity Fund                           x                                      x
Managed options – offshore
Offshore Hedge Fund                                 x                                      x
Offshore Balanced Fund                              x                                      x




GE 8/2006                                   BX141
Retirement business (continued)
                                                                                                   Continuations
                                           Interna-         Continua-   Continua-                                              Continuations
                                                      PPS                           Preservation         of        Provident
                                      RA    tional           tions of    tions of                                               of Provident
                                                      RA                               Funds       Preservation     Funds
                                              RA               RAs      PPS RAs                                                    Funds
                                                                                                      Funds
RAND-DENOMINATED FUNDS (continued)
Active building blocks – Offshore
Offshore Money Market Fund ($)
Offshore Money Market Fund (£)
Offshore Money Market Fund (€)
Offshore Bond Fund
Offshore Property Fund
Offshore Equity Fund
USA$-, £- AND €-DENOMINATED FUNDS
Managed options – offshore
International Hedge Fund                      x
International Balanced Fund                   x
Active building blocks – foreign
International Money Market Fund ($)           x
International Money Market Fund (£)           x
International Money Market Fund (€)           x
International Bond Fund                       x
International Equity Fund                     x
International Property Fund                   x




GE 8/2006                             BX142
Retirement business (continued)
                                                             International
                                      Investment Linked                       Composite Annuity
                                                          Investment Linked
                                           Pension
                                                               Pension
RAND-DENOMINATED FUNDS (continued)
Active building blocks – Offshore
Offshore Money Market Fund ($)                x                                       x
Offshore Money Market Fund (£)                x                                       x
Offshore Money Market Fund (€)                x                                       x
Offshore Bond Fund                            x                                       x
Offshore Property Fund                        x                                       x
Offshore Equity Fund                          x                                       x
USA$-, £- AND €-DENOMINATED FUNDS
Managed options – offshore
International Hedge Fund                                          x
International Balanced Fund                                       x
Active building blocks – foreign
International Money Market Fund ($)                               x
International Money Market Fund (£)                               x
International Money Market Fund (€)                               x
International Bond Fund                                           x
International Equity Fund                                         x
International Property Fund




GE 8/2006                             BX143
 2.        MINIMUM PREMIUMS AND TABLE CODES

                                                                Initial monthly      Single
                  Product                    Product code
                                                                   premium          premium
Endowment                                       E16, EP1          R150 (R300 if      R10 000
                                                                term less than 10
                                                                    years) *
International Endowment                           E17                R750            R10 000
EduFocus                                          E10             R150 (R300 if      R10 000
                                                                term less than 10
                                                                      years)
Sinking Fund                                      S03                   -            R10 000
Continuations with / without life insured       SC2, EC2             R150            R10 000
Retirement Annuity                          R04C, R04E, R04H,     R150 (R300 if       R2 500
                                            R02P, R01F, R01J    term less than 10
                                                                    years) *
Retirement Annuity (recurring commission)         R06C               R100             R2 500
International Retirement Annuity               R05C, R05P            R750           R10 000 if
                                                                                    only single
                                                                                     premium
                                                                                     R2 500 if
                                                                                       single
                                                                                     premium
                                                                                        plus
                                                                                     recurring
                                                                                     premium
Retirement Annuity Continuations              RC1C, RC1P
Preservation Funds                           PP2, PP2T, PF2,                          R5000
                                                  PF2T
Preservation Fund Continuations                PP1C, PF1C                             R5000
Provident Funds:
   Stratus                                        F01C            R150,00 p.m.      R2 500 only
   Stratus Premier                                                                    if single
                                                 FC70C            R255,00 p.m.       premium
                                                                                         plus
                                                                                     recurring
                                                                                     premium
Provident Funds Continuations:
   Stratus                                        FC1C            R150,00 p.m.        R2 500
   Stratus Premier                                FC7C            R255,00 p.m.        R2 500
Guaranteed Income                                 J01O          R100 income p.m.
                                                                   / R600 p.a.
Guaranteed Investment                         SG1P + J01P       R165 income p.m.
                                                                  / R2200 p.a.
Guaranteed Return                                 SG1                                R10 000
Guaranteed Property Investment                  Table 411                            R10 000
Investment Linked Pension                            -                  -            R100 000
International Investment Linked pension              -                  -            $10 000
 * Lower minimum premiums/contributions apply if the policy is part of a Stratus and Matrix
   combination product.




 GE 8/2006                                   BX144
F.        ADDITIONAL INFORMATION ABOUT RETIREMENT
          ANNUITIES

    REASONS WHY RA FUNDS ORIGINATED

If people do not make provision for their old age, the State has to look after them when they can no
longer work.

The State grants tax concessions to encourage people to make their own provision for old age.

Tax concessions with regard to the following contributions are granted currently:

•    Contributions made to retirement annuities, the State allows a certain amount to be deducted from
     a person’s taxable income (see maximum deductible contributions).
•    Contributions a person makes to an approved pension scheme can be deducted from his taxable
     income up to a certain maximum.
•    Contributions made by an employer to such a pension scheme for employees can again, within
     certain limits, be deducted from his own taxable income. In this way employers are encouraged to
     assist their employees in making provision for their old age.

PROTECTION OF BENEFITS

Except to the extent permitted by the Pension Funds Act, the Income Tax Act and the Maintenance Act,
RA benefits for a member and his/her dependants/nominees are protected against their creditors.

    LEGAL REQUIREMENTS FOR RA FUNDS
The Income Tax Act has provided for the deduction of contributions to retirement annuity funds since
1960. The most important requirements set by the State may be summarised as follows:

A permanent fund must be established for the sole purpose of providing pensions (life annuities) for
members of the fund or their dependants/ nominees. The rules of the fund must inter alia provide that:

−    members make contributions including contributions by way of transferring funds from a member’s
     approved pension fund, provident fund or other RA funds;
−    not more than one-third of the total value of a pension (life annuity) to which the person may become
     entitled may be commuted (converted) for a lump sum;
−    the retirement age must not be attained before the 55th and not after the day before the 70th birthday;
−    the only payment, in the event of death before retirement, shall be the contributions paid in (with
     interest) as a lump sum plus a pension (life annuity) for the dependants, which can be bought from
     the remaining benefits. One-third of this pension (life annuity) can be commuted.
−    a member may not deal with the policy at all, e.g. surrender it, borrow against it, cede it, or in any
     other way alienate or pledge it; and
−    the rules of the fund, as well as amendments to them, must be submitted for approval to the
     Commissioner for South African Revenue Services.




GE 8/2006                                           BX145
  FUNDS UNDERWRITTEN BY SANLAM LIFE

The following funds are underwritten by Sanlam Life:

CRAF : CENTRAL RETIREMENT ANNUITY

Sanlam Life employees together with an independent trustee form the Board of Trustees. Sanlam Life
will always remain the underwriter. A person who applies for a retirement annuity (RA) must be a
member of the Fund or must at the same time apply for membership of the Fund.

PPS-RAF : PROFESSIONAL PROVIDENT SOCIETY RETIREMENT ANNUITY FUND

The Fund was established by the Professional Provident Society (PPS). Professional people form the
Board of Trustees and they decide who the underwriter will be. Despite strong competition Sanlam Life
has succeeded in becoming the underwriter of this Fund.

Only professional people qualify as members of the PPS-RAF.

   GENERAL INFORMATION : RETIREMENT ANNUITY FUNDS
POLICIES

When a person becomes a member of a fund underwritten by Sanlam Life, he receives a copy of the
policy. Sanlam Life issues the original policy to the trustees for their safekeeping. The Fund is the
owner of the policy.

CHANGE IN OCCUPATION : EFFECT ON MEMBERSHIP

Once a person has acquired membership of a fund, he will retain his membership of that fund even if he
should later change his occupation (e.g. a professional person leaves his profession to start farming).


  INCOME TAX – IT ACT (s.11(n))

The Income Tax Act makes certain concessions regarding contributions to RA funds. The concessions
are subject to the following conditions:

   The contributions of a member of an RA fund will qualify for tax relief if he received any income, or a
   combination of the following types of income in the year of assessment:

   −   trade income (e.g. from an occupation, profession, business, service contract or rent from
       property)
   −   taxable interest income
   −   taxable dividend income
   −   pension payments
   −   taxable lump sums from pension or RA funds (see note)
   −   taxable portions of gratuities (see note)
   −   any other taxable income

   Tax-free interest income and tax-free allowances are excluded from the above.

Note: Since 1 September 1995 the said lump sums can no longer be used to manipulate a person’s
      average tax rate. However, the tax deduction still applies to the person’s total taxable income.


MARRIED PERSONS

A husband and a wife may each be a member of an RA fund in his or her own right.




GE 8/2006                                          BX146
MAXIMUM DEDUCTIBLE CONTRIBUTIONS (s.11 (n))

Contributions to an RA fund by a member will be deductible from his/her income. Under “income” the
following is understood:

−   nett trade income (in the case of farming income, before certain deductible expenses for
    development and improvements in respect of farming, if applicable, are taken into account)
−   taxable interest income
−   taxable dividends received
−   pension payments
−   taxable lump sums from pension or RA funds
−   taxable portions of gratuities
−   other taxable income

The deduction in respect of an RA contribution may not exceed the income for the fiscal year concerned.

The maximum deduction allowed in respect of the current contributions made by a taxpayer to an RA
during a year of assessment is the greatest of:

    (i)         15% of the amount remaining after the permissible deductions have been made from the
                income of the taxpayer (excluding income from “retirement funding employment”), but excluding
                deductions in respect of certain farming expenses, medical expenses, donations to educational
                establishments; or
    (ii)        R3 500 minus any deductions allowed to the taxpayer regarding current contributions to a
                pension fund; or
    (iii)       R1 750.

RETIREMENT ANNUITY FUND

Current Contributions

The greatest of:
    −       R1 750 or
    −       R3 500 less deductible current pension fund contributions; or
    −       15% of ‘non-pensionable’ taxable income.

Reinstating contributions

Maximum deduction : R1 800 p.a.

The maximum deductible contribution to a pension fund per year is limited to the greater of R1 750 and
7,5% of pensionable income per person. Since 1 March 1999 this limit also applies to individual
contributions to any pension fund established by law (e.g. government and associated institutions) or for
employees of any local authority (IT Act (s.11(k)).

The act refers to pensionable income as income received from retirement funding employment. Income
from retirement funding employment is that portion of the tax-payer’s remuneration which is taken into
account for the calculation of his contribution (by himself or on his behalf) to a pension or provident fund.

NB: Exception

            In the case of a former employee who becomes a partner in a partnership and continues to be a
            member of the pension or provident fund the following will apply:

            His/her income from retirement funding employment will be limited to the lesser of

            −    the amount which he received from the partnership in the 12 months immediately prior to
                 his/her becoming a partner or
            −    the amount of his/her share in the partnership profits for the current year.

            When profits that may be earned are divided, the profits exceeding this amount will be looked
            upon as other trade income.




GE 8/2006                                              BX147
Examples:

      1)    A taxpayer has a pensionable income of R50 000. Contribution to pension fund is 7,5%.
            His maximum deductible contribution will be:
             −   R3 750 to pension (7,5% of R50 000), and
            − R1 750 to RA funds.
      2)    If above-mentioned taxpayer makes no contribution to a pension fund, he will be able to
            contribute R3 500 to RA.
      3)    If his contribution to a pension fund is 10%, he will be able to contribute:
             −   R5 000 to pension of which R3 750 (maximum 7,5%) will be deductible, and
            − R1 750 to RA funds.
      4)    If the contribution to a pension fund is 6% and his pensionable income is R20 000, he will
            be able to contribute:
             −   R1 200 to pension, and
            − R2 300 to RA (3 500 - 1 200).
      5)    If the wife of this taxpayer (in (4)) also has a pensionable income of R5 000 and her
            contribution to the fund is 6%, they will be able to contribute in total:
             −   R1 500 to pension (1 200 + 300), and
            − R5 500 to RA (3 500 - 1 200) and (3 500 - 300).
      6)    A taxpayer’s nett taxable trade income amounts to R50 000 (he does not belong to a
            pension fund). He also received R5 000 taxable interest as well as tax-free allowances
            amounting to R2 000. His maximum deductible contribution will be:
            − R8 250 to RA funds (15% of R55 000).
      7)    A taxpayer’s nett taxable trade income amounts to R50 000 (he does not belong to a
            pension fund). His maximum deductible contribution will be:
            − R7 500 (15%) to RA funds.
      8)    If his nett taxable income amounts to R20 000, he will be able to deduct:
            − R3 500 to RA funds (even though it is more than 15% of taxable income).
      9)    A taxpayer’s pensionable income is R25 000 and his nett trade income from his farm is
            R30 000. Contribution to his pension fund is 8%.
            His maximum deductible contribution will be:
             −   R1 875 to pension (the greater of R1 750 and 7,5% of R25 000), and
            − R4 500 to RA funds (15% of R30 000).
      10)   A former employee of a partnership who is now one of the partners has a share of
            R30 000 in the partnership profit (he is still a member of the pension fund). In the
            12 months before he became a partner, he earned R20 000 and his pension contribution
            was 10%. His maximum deductible contribution will be:
             −   R1 750 to pension (maximum), and
            − R1 750 to RA funds.
      11)   If the same partner’s share of the partnership profit amounts to R50 000, his maximum
            deductible contribution will be:
             −   R1 750 to pension, and
             −   R4 500 to RA funds (15% of R30 000).

CONTRIBUTIONS TO MORE THAN ONE FUND

A member can contribute to one or more funds. However, no more than the maximum contribution
under the Income Tax law will be allowed.

NB:     It may, however, be better for the client to use a non-deductible contribution rather for
        endowment assurance and to use the proceeds for acquiring an annuity.




GE 8/2006                                      BX148
EXCEEDING DEDUCTIBLE CONTRIBUTIONS

Any current contributions or part thereof which did not qualify for deduction in the current tax year, may
be carried forward to the next tax year (or years), in which case it will be considered as a current
contribution. The total deductible amount for a current tax year will, however, still be subject to the
maximum as discussed above.

Lump sum contributions to retirement annuity funds will be treated as current contributions.

Example

Suppose a person made a contribution of R7 500 per year to an RA fund and his income (which does
not include pensionable income) in year 1 was R40 000 and in year 2, R60 000:

   Year 1

   Maximum allowable contribution (15% of R40 000) = R6 000
   Actual contribution = R7 500
   Only R6 000 will be allowed and R1 500 may be carried forward to year 2.

   Year 2

   Maximum allowable contribution (15% of R60 000) = R9 000
   Current contribution              = R7 500
   Contribution carried forward      = R1 500
                                     = R9 000
   R9 000 will be allowed in year 2.

CONTRIBUTIONS IN ARREARS

Fully paid-up policy and (VOP) reinstatement

A taxpayer who has discontinued contributions to an RA fund prematurely, but who contributes in a
subsequent tax year in such a manner that he is reinstated as a full member, is entitled to claim a
maximum deduction of R1 800 of such contributions over and above his current contributions in the year
in which he resumes normal contributions (i.e. those contributions which were discontinued
prematurely). This allowance will only be valid if the contributions prematurely discontinued would have
been deductible in the year in which they ought to have been paid (s.11(n)(bb)).

Both husband and wife may deduct R1 800 in respect of reinstatement contributions individually made.

For reinstatement contributions no deduction will be allowed unless it would have qualified as a current
contribution in the tax year in which it ought to have been paid.

Example:

   A taxpayer is a member of CRAF and his contribution is R3 500 per annum (maximum deductible
   according to income). During a specific year no contribution was made and the policy was
   automatically made paid-up.

       −    At reinstatement he must pay R3 500 (plus interest - if applicable) to Sanlam Life to effect
            reinstatement and he must continue his contribution of R3 500.
       −    He will only be allowed R3 500 (current) plus R1 800 (arrears) as deductions for the year of
            reinstatement.
       −    In the next year he will be allowed to claim R3 500 plus R1 700 for the reinstatement (R3 500
            – R1 800).




GE 8/2006                                         BX149
YEAR OF ASSESSMENT

The year of assessment for individuals ends on 28/29 February of each year. This includes all
individuals regardless of whether they derive their income from, for instance, a business concern,
farming, a salary, investments, or a combination of any of these.

If a taxpayer in this group has a farm, or is in business and finds it inconvenient to close his accounts on
28/29 February he may, with the approval of the South African Revenue Service, close his accounts on
another date. The income shown in these accounts is, however, regarded as being for the year of
assessment ending on 28/29 February. The taxpayer is therefore obliged to declare any income he may
have derived from other sources for the year of assessment.

If such a taxpayer contributes to a retirement annuity fund, only those contributions paid-up to and
including 28/29 February of the year concerned can be taken into account when the taxable income is
calculated. If a businessman or a farmer obtains the approval of the South African Revenue Service to
close his account on, say, 30 June, a contribution to a retirement annuity which was paid before
28 February 2005 can be deducted from his trade income for the year 1 July 2004 to 30 June 2005.

A contribution paid on 1 April 2005 (i.e. before he closes his accounts on 30 June 2005 but after the end
of the tax year which ended on 28 February 2005) will only be deductible for the year 1 July 2005 to
30 June 2006. The year of assessment will, however, end on 28 February 2006.

TAX CERTIFICATES

Sanlam Life provides an annual premium contribution certificate to each RA fund member, indicating
particulars of all the member’s RA contributions and premiums for Income Protectors (where applicable),
and in terms of which the member would possibly qualify for a tax deduction. The member also receives
a benefit statement.

These certificates and statements are prepared and posted to the members at the end of the tax year
together with an indication of the fund contributed to.

TAXABILITY OF BENEFITS

Benefits paid from RA funds are taxable at various instances such as retirement, death or disability of
a member. The benefits can be divided into 2 classes, namely lump sum benefits and compulsory
annuity benefits (the pension).

Pension instalment

Pension payments are regarded as gross income and are fully subject to income tax in the year in
which the drawer becomes entitled to them.

The lump sum

Certain concessions, however, are made regarding lump sums:

−   Certain amounts are specifically exempted from income tax as shown below.
−   The portion of the lump sum which exceeds the tax-free amount is taxable according to a prescribed
    formula. In essence the formula amounts to the higher of the tax payer’s average tax rate in the
    present year of assessment as calculated before taking into account the taxable portion of the lump
    sum, and that of the previous year. (At death the “average rate” is taken on the income of the
    member up to his death.)




GE 8/2006                                         BX150
The maximum tax-free lump sum will be the greater of:

−   R120 000, or
−   R4 500 multiplied by the number of full years’ membership of one or more retirement funds, except a
    fund from which the member has withdrawn or resigned. The period during which a member made
    no contributions will be taken into account only if the member has paid all outstanding contributions
    in respect of such an interruption.

The above maximum amount can be increased by contributions not deductible for income tax purposes
in the past. This is a stipulation of the IT Act (Second Schedule).

Notes:

1) The exemption applies to the combined benefits from all retirement funds (including pension, RA
   and provident funds).
2) When the above formula for calculating the exempted portion payable out of a pension fund or
   provident fund is applied, only service years which have actually expired or have been purchased,
   will be taken into account.
   Example:
   Suppose a taxpayer became a member of a pension fund at the age of 20 and he retires at 60.
   Service years expired will be 40. If this taxpayer should, however, withdraw from the fund at the age
   of 30, take a cash benefit and join another pension fund at the age of 40 to the age of 60, only 20
   service years will qualify. However, should he not have opted for the cash benefit, but transferred
   the benefits to the new pension fund, where he was credited with years of service, those years also
   qualify.
3) The lump sum payable out of pension funds established according to law or for employees of local
   authorities and boards of control will be free of IT for the portion accumulated up to 28 February
   1998. The balance may or may not be taxed subject to the other exemptions of the IT Act (Second
   Schedule) as discussed above. The tax-free lump sum from RA funds will be applicable in respect
   of such employees regardless of this concession.
4) The tax-free lump sum is available for both husband and wife.

At retirement and disablement

A maximum of one-third of the claim value may be taken in a lump sum and the above-mentioned
maximum will apply to the tax-free amount.

At death before retirement − IT Act (Second Schedule)

The exemption is the greatest of:

    (a)    R60 000, or
    (b)    an amount equal to the commutation value of one-third of the total life annuity which the
           member would have been entitled to if he had retired on the day before his death; or
    (c)    one-third of the member’s contributions to the fund plus 7% interest.

The amount thus calculated is, however, subject to the above maximum. See example on the following
page.

Example

    A member dies at age 50. The claim value of the RA policy (without cover) is R150 000, while the
    maximum cash amount which may be taken is R70 000 viz.:

    −     the member’s contributions to the fund (plus interest) to the amount of R30 000; plus
    −     one-third of the balance (R40 000).

    The maximum lump sum which may be taken tax-free, is the greatest of:
    (a) R60 000, or
                 1
    (b) R50 000 ( /3 x R150 000), or
    (c) R10 000 (1/3 x R30 000)
    R60 000 may therefore be taken tax-free.



GE 8/2006                                          BX151
    ESTATE DUTY – ED ACT (s.3(3)(a)bis.)

Only the lump sum taken under RA funds is subject to estate duty.

Any amount that accrues to a surviving spouse, is however, not subject to estate duty.

Income tax (if any) payable on the lump sum may be deducted to get the nett taxable amount for estate
duty purposes. The estate duty caused by the RA is payable by the beneficiary unless the deceased’s
will specifically provides that the estate itself will be liable for such estate duty.

At first glance it may appear that if the estate is subject to estate duty it would always be better not to
take a lump sum at all. You should bear in mind, however, that the beneficiaries’ liability for income tax
is increased by this, as a result of the higher annuity. Other factors to be taken into consideration are:

−    if the amount of estate duty paid by the deceased is reasonably low, it may be profitable to take at
     least the income tax-free portion of the lump sum. The liability for income tax on the annuity will be
     decreased thereby;
−    if a high amount of estate duty is payable, the estate duty payable (on the lump sum) will have to be
     weighed up against the saving in income tax on the annuity, if the maximum income tax-free lump
     sum is taken, and
−    it is probable that it would seldom be in the interest of a beneficiary to take so much in a lump sum
     that it is subject to both income tax and estate duty.




GE 8/2006                                          BX152
                              SECTION BZ


                          MATRIX RISKCOVER



                                                              Page

TYPE OF PRODUCTS ………………………………………………………….…..                   BZ 1
− MATRIX TOPCOVER ………………………………..……………………………………                BZ 1
− MATRIX TERMCOVER ……………………………………………………………………                 BZ 1
− MATRIX INCOME PROTECTOR …………………………………………………………              BZ 2
PREMIUM PATTERNS ……………………………………………………….……..                   BZ 2
− LEVEL: GROWTH OPTIONAL ………………………………..…………………………             BZ 2
− FIXED COMPULSORY GROWTH ……………………………………………………….              BZ 2
− AGE-RELATED COMPULSORY GROWTH …………………………………………….            BZ 3
− STEPPED: GROWTH OPTIONAL ……………………………………………………….             BZ 4
GROWTH CHOICE AVAILABLE …………………………………………………..                 BZ 5
GUARANTEE PERIOD ……………………………………………………….……..                   BZ 7
INITIAL TERM ………………………………………………………………………..                    BZ 9
COVER END DATE …………………………………………………………….……                     BZ 9
LIVES INSURED ………………………………………………………………..……                    BZ 9
INCEPTION DATE …………………………………………………………………..                    BZ 9
IMMEDIATE LIFE COVER …………………………………………………………                   BZ 10
FREE COVER ………………………………………………………………………..                      BZ 10
PREMIUMS …………………………………………………………………………..                       BZ 11
COLLECTION PREMIUM …………………………………………………………...                  BZ 11
ACCELERATOR VERSUS STAND-ALONE BENEFITS ……………………….            BZ 11
BENEFITS AVAILABLE …………………………………………….………………                   BZ 12
CHOICE OF BENEFITS …………………………………………………………….                   BZ 13
GENERAL CONDITIONS FOR ADMITTANCE OF A CLAIM ………………….         BZ 13
POLICY BENEFITS AND PREMIUMS AFTER ADMISSION OF A CLAIM .….   BZ 14
RATE DIFFERENTIATION ………………………………………………………….                  BZ 14
POLICY FEE ………………………………………………………………………….                      BZ 14
CASH, LOAN AND PAID-UP VALUES ……………………………………….…..             BZ 14
ALTERATIONS ………………….……………………………………………….…..                    BZ 14
OWNER ……………………………………………………………………..………..                       BZ 15
CESSIONS ……………………………………………………………………………                        BZ 15


                                                              2/…




GE 8/2006                         BZ
                                  -2-
                                                              Page


APPOINTMENT OF BENEFICIARIES TO RECEIVE A DEATH BENEFIT …….   BZ 15
NOMINATION OF A NOMINEE TO BECOME THE NEW POLICYHOLDER ….     BZ 16
POLICY DOCUMENTS ……………………………………………………………….                    BZ 16
COOLING-OFF PERIOD ……………………………………………………………..                  BZ 16
LAPSES AND REINSTATEMENT ………………………………………….……….                BZ 16
INTERMEDIARY'S REMUNERATION ……………………………………………..               BZ 17

 BENEFIT DESCRIPTIONS

DEATH (DS) …………………….……………………………………………………...                   BZ 18
FIRST DEATH (DS80) …………………….…………..……………………………...              BZ 20
FINAL EXPENSES (DSF1) …………………………………………………………..                BZ 23
DISABILITY FOR REGULAR OCCUPATION (OAR, OSR) ……………………...      BZ 25
DISABILITY FOR REGULAR AND REASONABLE ALTERNATIVE
                                                              BZ 30
OCCUPATION (OAS, OSS) ………………………………………………………….
FUNCTIONAL IMPAIRMENT (OAF, OSF) …………………………………………             BZ 35
PHYSICAL IMPAIRMENT (OAP, OSP) ……………………………………………..            BZ 45
WHOLE LIFE PHYSICAL IMPAIRMENT (OAP2, OSP2) ………………………..       BZ 50
FUNCTIONAL IMPAIRMENT PLUS DISABILITY FOR REGULAR
 OCCUPATION (CAR, CSR) ………………………………………………………...               BZ 55
FUNCTIONAL IMPAIRMENT PLUS DISABILITY FOR REGULAR AND
 REASONABLE ALTERNATIVE OCCUPATION (CAS, CSS) ………………….        BZ 67
CORE DREAD DISEASE (TAC, TSC) ……………………………………….……..            BZ 79
COMPREHENSIVE DREAD DISEASE (TAW, TSW) ……………………………..          BZ 82
WHOLE LIFE CORE DREAD DISEASE (TAC2, TSC2)   ………………………..      BZ 90
WHOLE LIFE COMPREHENSIVE DREAD DISEASE (TAW2, TSW2) …………      BZ 93
ACCIDENTAL DEATH (ASC) …………………………………………………..……                BZ 101
ACCIDENTAL INJURY (ASW) ………………………………………………………                 BZ 103
WAIVER OF PREMIUM AT DISABILITY (OPG1, OGG1) ………………………..      BZ 108
WAIVER OF PREMIUM AT DEATH (DP, DG) ……………………………………..          BZ 112
MATRIX INCOME PROTECTOR (OIB, OIO, OIT) ………………………………..        BZ 114
GENERAL EXCLUSIONS …………………………………………………………….                   BZ 126

                                                               3/…




GE 8/2006                         BZ
                                    -3-
                                                                    Page

 SUMMARY

SUMMARY 1: COMBINATIONS OF BENEFITS NOT AVAILABLE (PER
 LIFE INSURED) ON ONE MATRIX TOPCOVER OR MATRIX TERMCOVER
 POLICY …………………………………………………………………………….….                            BZ 127
SUMMARY 2: LIMITS PER BENEFIT (MATRIX TOPCOVER AND MATRIX
 TERMCOVER) ………………………………………………………………………                             BZ 129

 UNDERWRITING

OCCUPATIONAL UNDERWRITING ………………………………………………..                      BZ 131
− RATE GROUP 5 …………………………………….….…………………………………….                     BZ 131
− RATE GROUP 4 …………………………………….….…………………………………….                     BZ 131
− RATE GROUP 3 ………………………………………..…………………………………….                     BZ 131
− RATE GROUP 2 ……………………………………….……………………………………..                     BZ 132
− RATE GROUP 1 ………………………………………………………………………………                       BZ 132
− ACCIDENT AND DISABILITY CLASSES …………………………………….…………....           BZ 132
− CLASSES ……………………………………………………………………………………..                        BZ 132
− DEFINITION OF ADMINISTRATIVE WORK ………………………………………………              BZ 133
− RATE DIFFERENTIATION WITH REGARD TO SPOUSE ………………………………           BZ 133
− DEFINITION OF INCOME …………………………………………………………………                    BZ 133
CHANGE IN OCCUPATION/ACTIVITY …………………………………………….                    BZ 134
− CLAUSES ……………………………………………………………………………………..                        BZ 134
− QUALIFICATIONS ……………………………………………………………………………                      BZ 135
MEDICAL UNDERWRITING ………………………………………………………….                        BZ 136
− MEDICAL LIMITS …………………………………..………………………………………..                   BZ 136
− DETERIORATION OF INSURANCE RISK ………………………………………………..              BZ 137
− NOTES REGARDING MEDICAL REQUIREMENTS …………………………………….              BZ 138
MEDICAL REPORTS / QUESTIONNAIRES ………………………..…………….                  BZ 140
− VALIDITY PERIOD OF MEDICAL REPORTS ……………………………………………              BZ 140
− QUESTIONNAIRES : SPECIFIC CONDITIONS …………………………………………             BZ 140
− OTHER "QUESTIONNAIRES" (not printed forms) ………………………………………        BZ 143
− CONDITIONS FOR WHICH NO SPECIFIC QUESTIONNAIRES ARE AVAILABLE …   BZ 144
− PHYSICAL HANDICAPS …………………………………………………………………….                    BZ 145
FINANCIAL UNDERWRITING ……………………………………………………….                       BZ 146
REGIONAL UNDERWRITING ………………………………………….……………                        BZ 147
PART-TIME ACTIVITY UNDERWRITING ………………………….………………                   BZ 148
EFFECTIVE AMOUNT ………………………………………………..………………                         BZ 148
ADMINISTRATIVE INFORMATION …………………………………………………                      BZ 151



GE 8/2006                            BZ
                                          MATRIX RISKCOVER



Matrix RiskCover (hereafter referred to as “Matrix”) is a new generation risk product from Sanlam Life
(hereafter referred to as “Sanlam”), which enables the client to obtain transparent, low cost risk cover.
Matrix offers the required flexibility to accurately address the client's requirements for cover

Matrix does not offer an underlying savings benefit. The full premium is used to pay for risk cover.

One or more lives may be insured on a policy in the case of Matrix TopCover and Matrix TermCover.
Various benefits are available on these policies, and unique benefits may be selected for each life
insured. Matrix benefits are designed to satisfy the risk benefit needs of the modern day client.

For Matrix Income Protector only one life insured per policy is permitted. Only income benefits are
permitted for Matrix Income Protector. A waiver of premium benefit at disability is automatically included
in these benefits.


  TYPE OF PRODUCTS

Three product types are available, namely:

   •   Matrix TopCover
   •   Matrix TermCover
   •   Matrix Income Protector

MATRIX TOPCOVER

Matrix TopCover offers cover for every chosen benefit up to that benefit's maximum benefit age. For
benefits such as death and whole life dread disease, cover is provided until the death of the life insured.
Matrix TopCover may thus be seen as a whole life product for these cases. The maximum benefit ages
of the other Matrix risk benefits are set out later in this section.

Full proof of insurability, including an HIV-blood test, is required when the policy is taken out. This initial
proof of insurability will apply for as long as the policy is in force.

The policyholder selects an initial guarantee period when the policy is taken out. Thereafter further
guarantee periods in cycles of 5 years will apply. At the end of any guarantee period, a new premium will
be calculated for the next guarantee period. No further underwriting is required for the policy to continue.

MATRIX TERMCOVER

Matrix TermCover offers cover for each chosen benefit, for the chosen initial guarantee term.

The policyholder selects the initial guarantee period when the policy is taken out. At the end of the
chosen guarantee term, and if the life insured is still alive, the policyholder may extend the cover for a
further period, subject to Sanlam Life's new business requirements at the time. A new premium for a
further guarantee period of 5 years will then be calculated, and in cycles of 5 years thereafter.

If the chosen guarantee term exceeds the maximum benefit age for a chosen benefit, the cover for that
benefit will apply until the end of that maximum benefit age.

Full proof of insurability, including an HIV-blood test, is required when the policy is taken out. However,
no further underwriting is required for the policy's continuation.




GE 8/2006                                           BZ 1
MATRIX INCOME PROTECTOR

Matrix Income Protector offers a variety of different disability income benefits.

Cover is provided, for every chosen income benefit, up to the cover end date for that chosen benefit.

Full proof of insurability, including an HIV blood test, is required when the policy is taken out. The initial
proof of insurability applies for as long as cover is provided.

The initial guarantee period is 5 years. Thereafter further guarantee periods for cycles of 5 years will
apply. At the end of any guarantee period, a new premium will be calculated for a next guarantee period.
No further underwriting is, however, required for the policy to be continued.


  PREMIUM PATTERNS

This client can choose one of several premium patterns on his Matrix RiskCover policy. The working of
the various premium patterns is as follows:

LEVEL: GROWTH OPTIONAL

The policy-owner can choose to pay a level premium for a level amount of cover over the term of the risk
benefit.

With a level premium pattern, the insurance company effectively takes the mortality or morbidity curve
over the future lifetime of the insured, and flatten it out. The policy-owner therefore pays a premium that
is initially more than the true underlying risk, but less later on, as indicated in the graph below.


                                      Level: Growth Optional
            Rate




                                                        Age

                                               Risk          Level pattern


The advantage of the level premium pattern is that it provides stability to the policy-owner. Apart from
possible adjustments at the end of a guarantee period, premiums will remain the same over the long
term.

Different premium and cover growth options may be added to the policy.

FIXED COMPULSORY GROWTH

Under this pattern, premiums are contractually required to increase annually at a fixed rate, to maintain
the chosen level amount of cover. The fixed compulsory growth premium pattern offers a cheaper initial
premium than the level premium pattern, but gets more expensive over time. A higher compulsory
increase percentage is required to secure cover growth.




GE 8/2006                                             BZ 2
FIXED COMPULSORY GROWTH (continued)

Premium increases are contractual. The cover amount will therefore reduce when a premium increase is
skipped, reduced, or cancelled.

The underlying risk typically increases by a lower percentage than the premium at younger ages, and a
higher percentage than the premium at older ages. The fixed compulsory growth pattern mimics the risk
curve with a fixed increase percentage.


                                 Fixed Compulsory Growth
            Rate




                                                    Age

                                 Risk       Fixed Compulsory Growth pattern


AGE-RELATED COMPULSORY GROWTH

The compulsory annual premium increases required to maintain the chosen level amount of cover are
fixed upfront, for the duration of the policy. In this case, the annual premium increases follow the shape
of the risk curve more closely. This requires lower compulsory increases at younger ages, and higher
increases at older ages, as indicated in the graph below.

The age-related premium pattern also offers a cheaper initial premium than the level premium pattern.
This pattern also gets more expensive over time. A higher set of age-related growth percentages is
required to secure cover growth.

Premium increases are contractual. The cover amount will therefore reduce when a premium increase is
skipped, reduced, or cancelled.


                             Age-related Compulsory Growth
            Rate




                                                     Age

                                         Risk       Age-related pattern




GE 8/2006                                         BZ 3
STEPPED: GROWTH OPTIONAL

The policy provides cover for as long as a benefit allows, but it is initially priced for a fixed period of 10 or
15 years only. At the end of this term, the policy is extended for a further term, and the premium is
automatically re-calculated for the next period, or until the benefit cease age is reached. No underwriting
or intervention by the policy-owner is required at that stage, i.e. the insurability of the life insured is
guaranteed for the full duration of the contract. The increase in premium is determined by the life
insured's age at the time of the increase.


                                       Stepped: Growth Optional
             Rate




                                                        Age

                                              Risk          Stepped pattern


Different premium and cover growth options may be added to the policy.

Available premium patterns

 TopCover                          •    Level: Growth optional
                                   •    Fixed compulsory growth
                                   •    Age-related compulsory growth
                                   •    Stepped: Growth optional
 TermCover                         •    Level: Growth optional
                                   •    Fixed compulsory growth
 Matrix Income Protectorr          •    Level: Growth optional




GE 8/2006                                            BZ 4
    GROWTH CHOICES AVAILABLE

• OPTIONAL GROWTH (level or stepped premium patterns):

      Growth option        Percentage premium growth               Percentage cover growth
    No growth                            0%                                      0%
    Specified premium                    5%                                     3,5%
    and cover growth
                                         10%                                    7,0%
                                      CPI + 3%                CPI, with a maximum of 15% per annum
    Premium growth and        Not specified in advance *                         5%
    specified cover
    growth                    Not specified in advance *                        10%
                              Not specified in advance *      CPI, with a maximum of 15% per annum
                              Not specified in advance *      Change in the R/ US$ exchange rate
                                                              over the policy year, with a minimum of
                                                              the CPI, and a maximum of 35% in RSA
                                                              monetary terms.
                              Not specified in advance *      Change in the R/ Pound Sterling
                                                              exchange rate over the policy year, with a
                                                              minimum of the CPI and a maximum of
                                                              35% in RSA monetary terms.
                              Not specified in advance *      Change in the R/ Euro exchange rate
                                                              over the policy year, with a minimum of
                                                              the CPI and a maximum of 35% in RSA
                                                              monetary terms.

• FIXED COMPULSORY GROWTH:

      Growth option        Percentage premium growth               Percentage cover growth
    Compulsory premium                   5%                                      0%
    growth
                                         10%                                    3,5%
                            7% with whole life guarantee **                      0%
                           11% with whole life guarantee **                     3,5%

*  Premium increase will depend on cover growth and premium rates for new business at the time of the
   increase.
** Available only with Matrix TopCover

• AGE-RELATED COMPULSORY GROWTH:

      Premiums grow according to age and cover growth grows at 0% or 3,5% per year, according to the
      client's choice.




GE 8/2006                                        BZ 5
The table below indicates the premium growth rates for the standard and aggressive options:

                             Aggressive option                       Standard option
       Age next        Annual premium growth %:               Annual premium growth %:
       birthday
                        0% cover           3,5% cover          0% cover          3,5% cover
                         growth              growth             growth             growth
         15 to 25           3%                 7.5%                0%                4.5%
            26              3%                 7.5%                0%                4.5%
            27              3%                 7.5%                0%                4.5%
            28              3%                 7.5%                0%                4.5%
            29              4%                 8.5%                0%                4.5%
            30              4%                 8.5%                0%                4.5%
            31              5%                 9.5%                2%                6.5%
            32              5%                 9.5%                2%                6.5%
            33              6%                10.5%                2%                6.5%
            34              6%                10.5%                2%                6.5%
            35              7%                11.5%                2%                6.5%
            36              7%                11.5%                3%                7.5%
            37              8%                12.5%                3%                7.5%
            38              8%                12.5%                3%                7.5%
            39              9%                13.5%                3%                7.5%
            40              9%                13.5%                3%                7.5%
            41              10%               14.5%                4%                8.5%
            42              10%               14.5%                4%                8.5%
            43              10%               14.5%                4%                8.5%
            44              10%               14.5%                5%                9.5%
            45              10%               14.5%                5%                9.5%
            46              10%               14.5%                6%                10.5%
            47              10%               14.5%                6%                10.5%
            48              10%               14.5%                6%                10.5%
            49              10%               14.5%                6%                10.5%
            50              10%               14.5%                6%                10.5%
            51              10%               14.5%                7%                11.5%
            52              10%               14.5%                7%                11.5%
            53              10%               14.5%                7%                11.5%
            54              10%               14.5%                7%                11.5%
            55              10%               14.5%                7%                11.5%
            56              10%               14.5%                8%                12.5%
            57              10%               14.5%                8%                12.5%
            58              10%               14.5%                9%                13.5%
            59              10%               14.5%                9%                13.5%
            60              10%               14.5%                9%                13.5%
      61 and older          10%               14.5%               10%                14.5%



GE 8/2006                                        BZ 6
  GUARANTEE PERIOD

The client usually selects an initial guarantee period at the outset, except in the case of Matrix TopCover
with compulsory premium growth at 7% or 11% per year, with whole-life guarantee.

With Matrix Income Protector the guarantee period is always 5 years.

For other Matrix RiskCover policies the guarantee period is as follows:
   For all growth choices, except for the stepped premium pattern:
   Minimum         : 5 years
   Maximum         : 15 years

   For the stepped premium pattern:
   The client must choose one of two guarantee periods, namely 10 or 15 years.

On Matrix TopCover, Sanlam also offers the option of a whole life guarantee period. This requires
compulsory premium growth of 7% p.a. or 11% p.a. to be added to the policy. The premium payable for
the full term of the contract is guaranteed not to increase, except for the contractual growth.

The guarantee period applies to the total policy, and not to individual benefits. However, if the last expiry
date of a benefit is before the end of the guarantee period (including guarantee periods after the initial
guarantee period), cover for that specific benefit will cease on the expiry date of that relevant benefit.

MATRIX TOPCOVER

Except in the case of the whole-life guarantee, the guarantee period works as follows:

All premium patterns except stepped

The initial premium has been calculated for the full term of the benefits and is based on Sanlam Life’s
current experience of claims and other factors. When a guarantee period ends, a new guarantee period
of 5 years will start. At the end of each guarantee period, Sanlam Life will review the premium. Sanlam
Life may then adjust it, but only if Sanlam Life’s experience has changed, and not because a life insured
is older at that time. If an adjustment is made at the end of the first guarantee period and the premium is
increased, the increase in the premium will not be more than the percentage as indicated below
(interpolation is used if the initially selected guarantee period is between the guarantee periods below):

             Initial guarantee period                 Maximum % increase in premium
                        5 years                                           20%
                        6 years                                           21%
                        7 years                                           22%
                        8 years                                           23%
                        9 years                                           24%
                       10 years                                         25%
                       11 years                                         26%
                       12 years                                         27%
                       13 years                                         28%
                       14 years                                         29%
                       15 years                                         30%

This increase applies in addition to any contractual predetermined premium growth on the same date.

The above-mentioned does not apply if the whole-life guarantee was chosen.




GE 8/2006                                          BZ 7
MATRIX TOPCOVER (continued)

After expiry of the initial guarantee period consecutive further guarantee periods of 5 years apply.

Sanlam Life does not guarantee any maximum increases at the end of subsequent guarantee periods.

If a waiver of premium claim has been admitted, or already submitted, and it will continue after the end of
the guarantee period, Sanlam Life may reduce the cover amount of a benefit instead of increasing the
premium.

Stepped premium pattern

The initial premium has been calculated for the guarantee period, and is based on Sanlam Life's current
experience of claims and other factors. When a guarantee period ends, a new guarantee period of 5
years will start. At the end of each guarantee period, Sanlam Life will review the premium. Sanlam Life
will then increase the premium because a live insured will be older at that time. Sanlam Life may also
adjust the premium to reflect, if applicable, changes in our experience of claims and other factors.

After expiry of the initial guarantee term consecutive further guarantee periods of 5 years apply.

If a waiver of premium claim has been admitted, or already submitted, and it will continue after the end of
the guarantee period, Sanlam Life may reduce the cover amount of a benefit instead of increasing the
premium.

MATRIX TERMCOVER

The initial guaranteed period of a Matrix TermCover policy is the same as the initial term.


The initial premium has been calculated for the guarantee period, and is based on Sanlam Life's current
experience of claims and other factors. When a guarantee period ends, a new guarantee period of 5
years will start. At the end of each guarantee period, Sanlam Life will review the premium. Sanlam Life
will then increase the premium because a life insured will be older at that time. Sanlam Life may also
adjust the premium to reflect, if applicable, changes in our experience of claims and other factors.

Sanlam Life does not guarantee the maximum increase when the TermCover is extended for a further
term.

No further underwriting is required when the client requests that the cover be extended for an additional
cycle.

MATRIX INCOME PROTECTOR

The initial premium has been calculated for the full term of the benefits and is based on Sanlam Life’s
current experience of claims and other factors. When a guarantee period ends, a new guarantee period
of 5 years will start. At the end of each guarantee period Sanlam Life will review the premium. Sanlam
Life may then adjust it, but only if Sanlam Life’s experience has changed, and not because a life insured
is older at that time. If an adjustment is made at the end of the first guarantee period and the premium is
increased, the increase in the premium will not be more than 20%.

This increase is applicable in addition to any contractual predetermined premium growth on the same
date.

Sanlam Life does not guarantee any maximum increases at the end of subsequent guarantee periods.

If a claim has been admitted or already submitted, and will continue after the end of the guarantee period,
Sanlam Life may reduce the cover amount of a benefit instead of increasing the premium. Sanlam Life
may also reduce the amount of the monthly payment.




GE 8/2006                                          BZ 8
    INITIAL TERM

The initial term of a Matrix TermCover policy is the same as the initial guarantee period.


    COVER END DATE

The cover end date for every chosen benefit is set out in the contract. In the case of Matrix TopCover this
is the policy anniversary before or on the maximum benefit age of the benefit. For Matrix TermCover it is
indicated as the earliest of the policy anniversary before or on the maximum benefit age of the benefit,
and the end of the chosen term. In the case of Matrix Income Protector it is the policy anniversary before
the chosen cessation age of the benefit.

Cover for a benefit ends at midnight before the cover end date as indicated in the contract.


    LIVES INSURED

MATRIX TOPCOVER AND MATRIX TERMCOVER

More than one life insured may be insured per policy. The maximum number of lives insured allowed on
one policy is 10.

Different benefits may be selected for each of the lives insured.

The policyholder must have an insurable interest in each life insured that is insured in terms of the policy.

MATRIX INCOME PROTECTOR

Only one life insured per policy is permitted.


    INCEPTION DATE

The inception date can be any day of the month and is determined by the debit order date.

The cover for each benefit begins on the last of
•   the date on Sanlam's written acceptance of the application,
•   the cover start date for that benefit set out in the policy documents, and
•   the date on which the first premium is received, or on which arrangements to Sanlam's satisfaction
    have been made for the payment of the first premium.

Immediate life cover or free cover may be available before this date, subject to certain conditions (see
below).




GE 8/2006                                          BZ 9
    IMMEDIATE LIFE COVER

For any life insured for whom a Death or First Death benefit is applied for, immediate life cover will be
given under that death benefit, provided that:

•   the life insured is not yet aged 60 at the application date; and
•   the first premium has been paid together with the proposal, or, but for the death of the applicant, a
    debit or stop order for the first premium would have been honoured.

Immediate life cover will apply from the date Sanlam receives the proposal form, with all questions
correctly and fully answered and signed by the life assured and the applicant (if different parties), until the
earliest of:

•   the final underwriting decision being made that the proposal is accepted, declined, or deferred for the
    life insured;
•   30 days after the signing of the proposal form;
•   Sanlam cancelling the cover in writing.

The immediate life cover will apply only in respect of death from unnatural causes. The normal
contractual exclusions will apply. No immediate life cover will be payable if death is directly or indirectly
caused by:

•   the life insured participating in any dangerous pursuits;
•   exposure to risks beyond the borders of the RSA and which are, in the opinion of Sanlam, not
    generally found in the RSA, or are more severe than corresponding risks in the RSA.

The consideration of a claim will be subject to the then prevailing terms of the type of policy applied for,
and Sanlam’s usual practices.

The amount payable will be limited to the smaller of the initial death benefit amount and R500 000. The
amount will be payable to the beneficiary nominated in the application form, if any.

    FREE COVER

Free cover will be given on all benefits accepted by Sanlam without medical loadings, provided that:

•   the policy’s inception date is not later than the first of the month after the application date, and
•   the first premium has been paid together with the proposal, or, but for the death of the applicant, a
    debit or stop order for the first premium would have been honoured.

It will apply from the date following the date on which the final underwriting decision is made that the risk
is accepted at standard rates, to the day before the inception date of the policy. The normal contractual
exclusions will apply. If a waiting period applies, the benefit amount will only be paid at the end of the
waiting period and premiums will be payable during the waiting period.

The consideration of a claim will be subject to the then prevailing terms of the type of policy applied for,
and Sanlam’s usual practices. Free cover will not be given if any information which in Sanlam's
reasonable opinion is relevant to the insurance risk is not provided completely and correctly.




GE 8/2006                                           BZ 10
  PREMIUMS

MATRIX TOPCOVER AND MATRIX TERMCOVER

The client may select to pay premiums monthly or annually. Only recurring premiums are allowed.
Premiums must be paid regularly to keep the policy in force. If premium payments cease, the policy will
lapse.

The minimum premium for a policy, covering only one life insured, is R100,00 per month. If the policy
covers more than one life insured, the required minimum premium increases with R75,00 per month for
every additional life, i.e. R175,00 for two lives insured, R250,00 for three lives insured etc.

Likewise, the minimum annual premium for a policy, covering only one life insured, is R1 140,00. This
required minimum premium increase with R855,00 per annum for every additional life insured covered by
the policy.

If the Stratus and Matrix combination product is chosen, the minimum premium for the Matrix part of the
package is R75,00 p.m.

Premiums may be paid by debit order or stop order (the latter is available only for monthly payments).

The premium may not be chosen. The chosen cover amounts for the respective benefits determine the
premium. If the premium for the chosen benefits is less than the minimum premium that is required at the
time, more benefits (Matrix TopCover or Matrix TermCover) must be added to the policy, or the cover
amounts of the benefits must be increased in order to comply with the minimum premium requirements.

MATRIX INCOME PROTECTOR

The minimum premium is R100,00 per month.


  COLLECTION PREMIUM

There is no debit order discount.

For premiums payable by stop-order the collection premium is currently calculated as 3,5% of the total
monthly premium, excluding the collection premium. Sanlam Life may change this percentage from time
to time. If Sanlam Life increases the percentage, the total monthly premium will increase.

When premium growth takes place, the collection premium will also increase.


  ACCELERATOR BENEFITS VERSUS STAND-ALONE BENEFITS

Matrix TopCover and Matrix TermCover benefits are available in 2 forms, namely accelerator benefits
and stand-alone benefits.

Income protector benefits, which may only be taken on Matrix Income Protector policies are available
only as stand-alone benefits.

Accelerator benefits means that an early payment of the death benefit of the life insured concerned takes
place in the event of a claim.

Stand alone means that a claim for a specific benefit will not result in an early payment of the death
benefit (in the case of TopCover and TermCover) for that life insured. A claim on a stand-alone benefit
has no effect on any other benefit.

Various benefits are available as either accelerator or stand alone benefits. Others are available in
stand-alone form only, while premium waiver benefits are available as an additional benefit on TopCover
and TermCover policies.




GE 8/2006                                        BZ 11
  BENEFITS AVAILABLE

The following table is a summary of the benefits available on Matrix TopCover and Matrix TermCover,
and also indicates in which form they are available.

                                                                                               Additional
               Benefit              Benefit code        Stand alone          Accelerator
                                                                                                benefit
 Death                              DS                         X
 First death                        DS80                       X
 Final expenses                     DSF1                       X
 Disability for regular and         OSS, OAS                   X                  X
 reasonable alternative
 occupation
 Disability for regular             OSR, OAR                   X                  X
 occupation
 Functional impairment              OAF, OSF                   X                  X
 Physical impairment                OAP, OSP                   X                  X
 Whole life physical impairment     OAP2, OSP2                 X                  X
 Functional impairment plus         CAR, CSR                   X                  X
 disability for regular
 occupation
 Functional impairment plus         CAS, CSS                   X                  X
 disability for regular and
 reasonable alternative
 occupation
 Core dread disease                 TAC, TSC                   X                  X
 Comprehensive dread disease        TAW, TSW                   X                  X
 Whole life core dread disease      TAC2, TSC2                 X                  X
 Whole life comprehensive           TAW2, TSW2                 X                  X
 dread disease
 Accidental death                   ASC                        X
 Accidental injury                  ASW                        X
 Waiver of premium with future      DG                                                              X
 growth at death
 Waiver of premium without          DP                                                              X
 future growth at death
 Waiver of premium with future      OGG1                                                            X
 growth at disability
 Waiver of premium without          OPG1                                                            X
 future growth at disability

The following benefits are available only as stand-alone benefits on Matrix Income Protector.

                              Benefit                              Benefit code
               Income Protector                                        OIO
               Temporary Income Protector                              OIT
               Overhead Expenses Protector                             OIB

A waiver of premium benefit at disability is automatically included with every benefit variation.




GE 8/2006                                          BZ 12
    CHOICE OF BENEFITS

Matrix TopCover and Matrix TermCover

•   It is not compulsory to take a death benefit on any life insured.
•   Any permissible combination of benefits may be taken.            Each life insured may have a unique
    combination of benefits on the same policy.
•   Accelerator benefits are available only if the death benefit is also taken for that same life insured.
•   The choice of waiver of premium benefits for a specific life means that the claim event for the selected
    benefit (e.g. death or disability) must take place on the life of that life insured. After a claim is
    admitted, the premium for the total policy is waived, in other words, it is waived for all the lives insured
    on that policy and all the benefits.
•   Waiver of premium without future growth may be taken with policies with premium growth. After
    admission of a claim the waived premium does not increase.
•   Waiver of premium with future growth may only be taken if the policy has contractual premium and
    cover growth. If the growth is cancelled, the waiver of premium benefit will be changed to the waiver
    of premium without future growth.
•   If waiver of premium at death is taken, there must be more than one life insured on the policy.
•   Accelerator and stand-alone variations of the same benefit is not available on the same life
    insured on the same policy.
•   If both the Matrix waiver of premium at death and Matrix waiver of premium at disability is taken on
    the same policy, only the following combinations are permitted:
    − both with growth (DG and OGG1), or
    − both without growth (DP and OPG1)
    The one benefit can therefore not be with growth and the other without it.
•   A maximum of 8 benefits per life insured are permitted per policy.

Matrix Income Protector

•   Any combination of the three available benefits can be taken on the same policy.
•   Matrix Income Protector can not be taken with the benefits available on Matrix TopCover and Matrix
    TermCover.


    GENERAL CONDITIONS FOR ADMITTANCE OF A CLAIM

Sanlam Life will admit a claim only if

•   it meets the description and requirements of the claim event to our satisfaction;
•   Sanlam Life receives all information we reasonably may require;
•   all aspects of the claim are proved to our satisfaction by medical and other evidence we reasonably
    may require;
•   the premiums for the policy have been paid in full;
•   Sanlam Life is satisfied that the bodily injury took place, or the symptoms first presented, or the cause
    of the claim was diagnosed for the first time, while the cover for the benefit was in force.




GE 8/2006                                           BZ 13
    POLICY BENEFITS AND PREMIUMS AFTER ADMISSION OF A CLAIM

Matrix TopCover and Matrix TermCover

If the benefit is an accelerator benefit, the death benefit amount of the life insured will be reduced with the
amount paid out. Where the cover amount of another accelerator benefit of the life insured exceeds the
remaining amount of the death benefit, the cover amount of that accelerator benefit of the life insured will
be reduced to an amount equal to the reduced death benefit amount.

If the benefit is a stand-alone benefit, the cover amounts of the other benefits will not be reduced.

The premium will be reduced to reflect any decrease in benefit amounts.

Matrix Income Protector

The premium and cover amounts are not influenced by the payment of a claim.


    RATE DIFFERENTIATION

The age, sex, smoking habits, occupation, part-time activities and medical history of the life/lives insured
determine the cost of cover.


    POLICY FEE

A monthly policy fee of R17,00 is payable, and is added to the risk premiums of the chosen benefits to
determine the total monthly premium.

The monthly policy fee for the Matrix part of a Stratus and Matrix combination product is R11,00.


    CASH, LOAN AND PAID-UP VALUES

A Matrix policy provides pure risk benefits, and consequently offers no cash values, loan and paid-up
values. TopCover and TermCover policies may, however, be offered to banks as security for loans.

The Stratus part of a Stratus and Matrix combination product do offer cash values, loan values and paid-
up values.


    ALTERATIONS

The following alterations can be done:

•   Cover decreases and cancellations
•   Addition of or increase in a benefit
•   Cancellation of or decrease in premium and/or cover growth
•   Addition of or increase in premium and/or cover growth
•   Removal of lives insured (only TopCover and TermCover)
•   Change in waiting period (only Matrix Income Protector)
•   Decrease in or cancellation of benefits
•   Change in type of benefit (cancellation of one benefit and addition of another one in place of the
    benefit removed)
•   Addition of lives insured




GE 8/2006                                          BZ 14
    OWNER

Only one owner (policyholder) per policy is allowed. The policyholder specifies which lives insured and
benefits must be included on a policy, and is also responsible for the payment of premiums. Another
party may pay the premiums, but the policyholder remains responsible for premium payments.

With TopCover and TermCover the policyholder does not have to be a life insured on the policy. The
following may all be policyholders on these policies:
•   Individual
•   Trustees of a Trust in their capacity as such
•   Company
•   Non-taxable institution

With Matrix Income Protector the policyholder can be an individual or an institution. If the policyholder is
an individual, the policyholder and life insured must be the same person.


    CESSIONS

Matrix TopCover and Matrix TermCover

The policyholder may cede the policy as collateral security. Sanlam Life must be informed in writing of
the cession. Sanlam Life will register the cession in Sanlam Life's records on receipt of such a notice.
The person or entity to which the policy was ceded, will have first right to the benefits provided by the
policy.

The policy can be ceded outright to another person or entity. That person or entity will become the new
owner. If, at the time of such a cession, there is an appointment of a beneficiary to receive a death
benefit, or a nomination for ownership, it will then be cancelled. The policy can be ceded to only one
cessionary at a time.

Matrix Income Protector

Only outright cessions from one employer of the life insured to another are permitted. No other outright
cessions or colateral cessions are permitted. This is allowed only after the policy had been issued.


    APPOINTMENT OF BENEFICIARY/BENEFICIARIES TO RECEIVE A DEATH BENEFIT

Matrix TopCover and Matrix TermCover

All benefits are payable to the policyholder or his/her estate. However, the policyholder may appoint one
or more beneficiaries to receive the benefits payable at the policyholder's death. Sanlam Life will pay the
benefits to a beneficiary only if the last-mentioned accepts the appointment as a beneficiary. A
beneficiary can, however, accept the appointment only after the policyholder’s death. A maximum of 10
beneficiaries may be appointed per policy.

Beneficiaries may only be appointed if the policyholder took out the death benefit and/or the accidental
death benefit on his own life.

The appointment of a beneficiary can be revoked or changed at any time. The appointment or the
revocation or change of an appointment must be in writing and must be signed by the policyholder, and
must reach Sanlam Life’s head office before the policyholder’s death.

The appointment of beneficiaries will lapse in the event of an outright cession of the policy. If the policy is
ceded as collateral security the appointment will not lapse, but the rights of the cessionary will have
preference over any rights of a beneficiary.

Matrix Income Protector

No benefit is payable at death, therefore no beneficiary can be appointed with this product.




GE 8/2006                                           BZ 15
    NOMINATION OF A NOMINEE TO BECOME THE NEW POLICYHOLDER

Matrix TopCover and Matrix TermCover

The policyholder may nominate a person or an entity to become the new policyholder in the event of the
policyholder's death.

Only one nominee may be appointed per policy.

The nominated person must accept the nomination in order to become the new policyholder. The
nominee, as the new policyholder, will then be responsible for premium payments. The nominee can,
however, accept the nomination only after the policyholder's death.

If the nominee does not accept the nomination or if no one was nominated, the policy will form an asset in
the policyholder’s estate.

The nomination can be revoked or changed at any stage. The nomination or the revocation or changing
of the nomination must be in writing and must be signed by the policyholder and must reach Sanlam
Life’s head office before the death of the policyholder.

The nomination will lapse if the policyholder cedes the policy, whether outright or as collateral security.

Matrix Income Protector

No appointment of a nominee for policy ownership is permitted.


    POLICY DOCUMENTS

The policy documents that will be sent to the policyholder after the policy had been issued, consists of the
following:
•   A policy overview, which is a summary of the policy. It contains information such as the lives insured
    on the policy, with each life insured's benefits, and also any special conditions applicable to the policy,
•   The general policy provisions, which sets out the general working of the policy, and
•   Benefit annexures for each benefit included on the policy, and which sets out the working of each
    benefit.

The policy contract between the policyholder and Sanlam consists of the following:
•   the application for the policy,
•   Sanlam's acceptance of the application,
•   the policy overview,
•   the accompanying general policy provisions,
•   the benefit annexure(s),
•   other documents, correspondence and information, if any, that by implication forms part of the
    contract.

    COOLING-OFF PERIOD

Policyholders who take out new policies, or do changes to existing policies, have the right to cancel their
policies or the policy amendment within 30 days (the cooling off period) from the date they receive their
contracts. Sanlam consequently allows this within 40 days from the date of the Notice of Acceptance.


    LAPSES AND REINSTATEMENT

A policy lapses and offers contractually no insurance benefits if premiums are not paid within the periods
of grace. A policy that was lapsed may be reinstated. This may include proof of insurability.




GE 8/2006                                           BZ 16
  INTERMEDIARY'S REMUNERATION

Up front commission is paid on the monthly or annual premiums.

The intermediary agrees with the client on the commission payable. Any percentage between 0% and
100% of standard commission may be chosen. The standard commission is the maximum which is
allowed in terms of legislation. Commission may be divided between a maximum of four intermediaries.

For Matrix TopCover the commission is calculated as for whole life policies.

For Matrix TermCover commission is calculated for the initially selected term only. Further commission is
payable when cover is extended for a further period. The intermediary is then entitled to negotiate
commission for the extension with the client, subject to the same rules that applied when the policy was
taken out.

For Matrix Income Protector the commission is calculated for the term until the chosen benefit cessation
age.

Commission that becomes payable during the term of the policy as a result of automatic premium growth,
will be paid in accordance with the existing rule and product dispensation to the intermediary who
rendered service when the policy was taken out. The rule is, however, being revised and can be
amended shortly.




GE 8/2006                                        BZ 17
                                         BENEFIT DESCRIPTIONS


                                                    DEATH (DS)


DESCRIPTION

Sanlam will pay the cover amount as a lump sum if the life insured dies before the benefit cease age.

TERMINAL ILLNESS

If the life insured is diagnosed with a medical condition that, according to Sanlam's Chief Medical Officer,
will result in death within 12 months, the client may apply for an early payment of the death benefit.

Sanlam Life may then pay an early death benefit. The amount of the early death benefit will be 85% of
the cover amount for this benefit as set out in the policy overview.

After Sanlam Life has made this payment, the death benefit, as well as all other benefits on the life of the
insured, will end. However, if the life insured has a waiver of premium at death benefit, Sanlam Life will
consider a claim for that benefit.

GUARANTEE PERIOD

The client selects the initial guarantee period when taking out the policy. The following minimum and
maximum guarantee periods are available for both Matrix TopCover (except for 7% and 11% per year
compulsory premium growth with whole-life guarantee) and Matrix TermCover:
    •   Minimum : 5 years
    •   Maximum : 15 years

For Matrix TopCover with compulsory premium growth at 7% or 11% per year a lifelong premium
guarantee applies. For the full term of the contract Sanlam Life will not increase the premium payable,
except for the contractual growth.

PREMIUM AND COVER GROWTH

Premium and cover growth is available according to the choice of growth selected by the policyholder.

INCEPTION AGES

    •   Minimum          :   When fixed compulsory premium growth is chosen, the minimum inception age is
                             30 next birthday. Otherwise a minimum of 15 next birthday applies.
    •   Maximum          :   80 age next birthday

BENEFIT CEASE EVENTS

Matrix TermCover

This benefit will end:
•   at midnight before its cover end date as set out in the policy overview, or
•   if the policy is ended for any reason before the cover end date, or
•   if a claim is paid.

Matrix TopCover

Whole life cover is provided. However, the benefit will end earlier if:
•   the policy ends for any reason before the cover end date, or
•   a claim is paid.

QUALIFYING LIVES

Persons who qualify for rate groups 1, 2, 3, 4 and 5 can apply for death benefits.




GE 8/2006                                             BZ 18
RATE DIFFERENTIATION

Rate differentiation for the calculation of premiums takes place on the grounds of:
   •   Rate group
   •   Smoking habits
   •   Sex

LIMITS

Minimum      : R50 000 per life insured
Maximum      : None (subject to financial underwriting)

Housewives, scholars, students and pensioners only qualify for a limited amount of death benefit, namely:

       •    Housewives        :     Greater of R350 000 and 3 x income of spouse, but with a total
                                    maximum of R5 million
       •    Scholars          :     R300 000
       •    Students          :     R500 000
       •    Pensioners        :     Greater of R350 000 and 3 x income, but with a total maximum of
                                    R5 million

An absolute maximum amount of R5 million applies for death benefits, First death benefits, Final
expenses benefits and accident related death benefits for the above occupations.

All death benefit amounts (with Sanlam Life and all other companies), accident-ralated death benefits
(with Sanlam Life), Final expenses benefit amounts and First death benefits already provided on the life
of the insured, will be taken into account to determine the maximum death benefits allowed, but for
housewives and pensioners only Sanlam assurance is taken into account.

EXCLUSIONS

Sanlam Life will not admit a claim if death is caused by suicide, also during insanity, committed within
24 months after cover for the benefit has started, or after the policy has been re-instated after an earlier
lapse. If the cover amount is increased, other than through benefit growth, this period will apply to the
increase in the cover amount from the date of alteration.

The person or entity who claims the benefit must prove that the life insured did not commit suicide.




GE 8/2006                                         BZ 19
                                             FIRST DEATH (DS80)


DESCRIPTION

Sanlam Life will pay the cover amount as a lump sum if the life insured dies before the cover end date. A
benefit can be claimed at the death of the life insured linked to this benefit, who dies first.

TERMINAL ILLNESS

If a life insured is diagnosed with a medical condition that, according to Sanlam Life’s Chief Medical
Officer, will result in death within the next 12 months, the client may apply for an early payment of the
death benefit.

Sanlam Life may then pay an early death benefit. The amount of the early benefit will be 85% of the
cover amount for this benefit as set out in the policy review.

After Sanlam Life has made this payment, this benefit, as well as all other benefits on the life of the
insured with the terminal illness, will end. However, if the life insured with a terminal illness has waiver of
premium benefit at death, Sanlam Life will consider a claim for that benefit as well.

For the remaining lives insured linked to this benefit, this benefit, as well as all accelerator benefits, will
cease.

GUARANTEE TERMS

The client chooses the initial guarantee term at inception of the policy. The following minimum and
maximum guarantee terms are applicable to both Matrix TopCover (except for 7% and 11% a year
compulsory premium growth, with whole-life guarantee) and Matrix TermCover:

        •    Minimum        : 5 years
        •    Maximum        : 15 years

For Matrix TopCover with compulsory premium growth at 7% or 11% a year, a lifelong premium
guarantee will apply. For the full term of the contract, Sanlam Life will not increase the premium payable,
except for the contractual growth.

PREMIUM AND COVER GROWTH

Premium and cover growth are available according to the choice of growth selected by the policyholder.

AGES AT ENTRY

    •       Minimum     :    When fixed compulsory premium growth is chosen, the minimum age at entry is
                             30 next birthday. Otherwise a minimum of 15 next birthday will apply.
    •       Maximum     :    80 age next birthday

BENEFIT CEASE EVENTS

Matrix TermCover

The benefit will end:
•       at midnight before the cover end date set out in the policy review, or
•       if the policy ends for any reason before the cover end date, or
•       if a claim is paid.

Matrix TopCover

Whole-life cover is provided. However, the benefit will end earlier if:
•       the policy ends for any reason before the cover end date, or
•       if a claim is paid.




GE 8/2006                                              BZ 20
LIVES QUALIFYING

Persons who qualify for rate groups 1, 2, 3, 4 and 5 can apply for First death benefits.

RATE DIFFERENTIATION

Rate differentiation for the calculation of premiums takes place on the grounds of:

•   Rate group
•   Smoking habits
•   Sex

LIMITS

Minimum        : R50 000 per life insured
Maximum        : None (subject to financial underwriting)

Housewives, scholars, students and pensioners only qualify for a limited amount of the First Death
benefit, namely:

       •    Housewives         :   Greater of R350 000 and 3 x income of spouse, but with a total
                                   maximum of R5 million
       •    Scholars           :   R300 000
       •    Students           :   R500 000
       •    Pensioners         :   Greater of R350 000 and 3 x income, but with a total maximum of
                                   R5 million

An absolute maximum amount of R5 million will apply for death benefits, First Death benefits, Final
expenses benefits and accident-related death benefits for the above-mentioned occupations.

All death benefit amounts (at Sanlam Life and all other companies), accident-related death benefits (at
Sanlam Life), Final expenses benefit amounts and First Death benefits already provided on the relevant
life insured are taken into account with the determination of the maximum permissible First Death
benefits, but for housewives and pensioners, only Sanlam insurance is taken into account.

ADMITTANCE OF A CLAIM

Sanlam Life will admit a claim only once for this benefit.

If Sanlam Life admits a claim, this benefit as well as all accelerator benefits for the remaining lives
insured linked to this benefit, will end. However, the remaining lives insured linked to this benefit have
the option to take out death cover and accelerator benefits not exceeding the respective cover amounts
as at the time of the claim, without proof of health and subject to Sanlam Life’s new business
requirements.

EFFECT OF A CLAIM FOR AN ACCELERATOR BENEFIT

If, for a life insured linked to this benefit, Sanlam Life admits a claim for an accelerator benefit, Sanlam
Life, despite anything to the contrary in the policy, reduce the First Death cover amount for all the lives
insured linked to this benefit by the amount that Sanlam Life has paid.

Where the cover amount of an accelerator benefit for any life insured linked to this benefit exceeds the
reduced First Death cover amount, Sanlam Life will reduce the cover amount of the accelerator benefit to
an amount equal to the reduced First Death cover amount.




GE 8/2006                                          BZ 21
EXCLUSIONS

Sanlam Life will not admit a claim if death is caused by suicide, also during insanity, committed within 24
months after cover for the benefit has started, or after the policy has been reinstated after an earlier
lapse. If the cover amount is increased, other than through benefit growth, this period will apply to the
increase in the cover amount from the date of alteration.

The person or entity who claims the benefit must prove that the life insured did not commit suicide.




GE 8/2006                                         BZ 22
                                           FINAL EXPENSES (DSF1)


DESCRIPTION

Sanlam Life will pay the cover amount as a lump sum if the life insured dies before the cover end date. A
benefit can be claimed at the death of the life insured. Sanlam Life aims to pay the cover amount within
48 hours after its requirements having been met.

GUARANTEE TERMS

The client chooses the initial guarantee term at inception of the policy. The following minimum and
maximum guarantee terms are applicable to both Matrix TopCover (except for 7% and 11% a year
compulsory premium growth, with whole-life guarantee) and Matrix TermCover:

        •    Minimum         : 5 years
        •    Maximum         : 15 years

For Matrix TopCover with compulsory premium growth at 7% or 11% a year, a lifelong premium
guarantee will apply. For the full term of the contract, Sanlam Life will not increase the premium payable,
except for the contractual growth.

PREMIUM AND COVER GROWTH

Premium and cover growth are available according to the choice of growth selected by the policyholder.

AGES AT ENTRY

    •       Minimum      :    When fixed compulsory premium growth is chosen, the minimum age at entry is
                              30 next birthday. Otherwise a minimum of 15 next birthday will apply.
    •       Maximum      :    80 age next birthday

BENEFIT CEASE EVENTS

Matrix TermCover

The benefit will end:
•       at midnight before the cover end date set out in the policy review, or
•       if the policy ends for any reason before the cover end date, or
•       if a claim is paid.

Matrix TopCover

Whole-life cover is provided. However, the benefit will end earlier if:
•       the policy ends for any reason before the cover end date, or
•       if a claim is paid.


LIVES QUALIFYING

Persons who qualify for rate groups 1, 2, 3, 4 and 5 can apply for Final expenses benefits.

RATE DIFFERENTIATION

Rate differentiation for the calculation of premiums takes place on the grounds of:

•       Rate group
•       Smoking habits
•       Sex




GE 8/2006                                              BZ 23
LIMITS

Minimum       : R50 000 per life insured
Maximum       : R100 000 per life insured

Housewives, scholars, students and pensioners also qualify for the Final Expenses benefit. The available
amount is part of the absolute maximum amount of R5 million that applies to death benefits and accident-
related death benefits in the case of the above-mentioned benefits.

All death benefit amounts (at Sanlam Life and all other companies), accident-related death benefits (at
Sanlam Life), Final expenses benefit amounts and First Death benefits already provided on the relevant
life insured are taken into account with the determination of the maximum permissible Final Expenses
benefits, but for housewives and pensioners, only Sanlam insurance is taken into account.

EXCLUSIONS

Sanlam Life will not admit a claim if death is caused by suicide, also during insanity, committed within 24
months after cover for the benefit has started, or after the policy has been reinstated after an earlier
lapse. If the cover amount is increased, other than through benefit growth, this period will apply to the
increase in the cover amount from the date of alteration.

The person or entity who claims the benefit must prove that the life insured did not commit suicide.




GE 8/2006                                         BZ 24
                     DISABILITY FOR REGULAR OCCUPATION (OAR, OSR)

DESCRIPTION

Sanlam will pay the cover amount as a lump sum if the life insured becomes disabled.

TYPE OF BENEFIT

This benefit may be selected as an accelerator (OAR) or stand-alone benefit (OSR).

GUARANTEE PERIODS

The client selects the guarantee period when taking out the policy. The following minimum and maximum
guarantee periods apply for both Matrix TopCover (except for 7% and 11% per year compulsory premium
growth with whole-life guarantee) and Matrix TermCover:
    •   Minimum : 5 years
    •   Maximum : 15 years

For Matrix TopCover with compulsory premium growth at 7% or 11% per year a lifelong premium
guarantee applies. For the full term of the contract Sanlam Life will not increase the premium payable,
except for the contractual growth.

PREMIUM AND COVER GROWTH

Premium and cover growth is available according to the choice of growth selected by the policyholder.

INCEPTION AGES

    •   Minimum          :   When fixed compulsory premium growth is chosen, the minimum inception age is
                             30 next birthday. Otherwise a minimum of 15 next birthday applies.
    •   Maximum          :   60 age next birthday

BENEFIT CEASE AGE

65 next birthday

BENEFIT CEASE EVENTS

This benefit will end:
•   at midnight before the cover end date as set out in the policy overview, or
•   if the policy ends for any reason before the cover end date, or
•   if a claim is paid.

QUALIFYING LIVES

Persons who qualify for rate groups 1, 2, 3, 4 and 5 can apply for disability benefits.

Lives are further divided into 5 disability classes (A, B, C, D and E) (see Classes).       Only persons
classified in classes A, B and C qualify for disability for regular occupation.

Housewives, scholars, students and unemployed persons do not qualify for disability for regular
occupation.

RATE DIFFERENTIATION

Rate differentiation for the calculation of premiums takes place according to:
    •   Disability class (Occupation)
    •   Smoking habits
    •   Sex




GE 8/2006                                           BZ 25
LIMITS

Minimum       : R50 000 per life insured
Maximum       : R10 000 000 per life insured

The sum total of all the following benefits are taken into account when the permissible maximum amount
for disability benefits is determined:

•   functional impairment plus disability benefits (with Sanlam Life and all other insurers);
•   physical impairment (with Sanlam Life);
•   functional impairment (with Sanlam Life); and
•   disability benefits (lump sum, income benefits and waiver of premium)(with Sanlam Life and all other
    insurers).

Sanlam also restricts the available disability amounts according to income, as follows:

                   Age next birthday
                  (males and females)              Multiple of monthly taxable income

            Up to and including 30 anb              225 x average monthly income
            31 anb up to and including 35 anb       210 x average monthly income
            36 anb up to and including 40 anb       160 x average monthly income
            41 anb up to and including 45 anb       135 x average monthly income
            46 anb up to and including 50 anb       120 x average monthly income
            51 anb up to and including 55 anb        75 x average monthly income
            56 anb and older                       37,5 x average monthly income

The total disability benefit amount, payable from all sources, may not exceed the above limit. Income
Protector benefits (excluding temporary income protector) and waiver of premium benefits at disability are
also taken into account to determine the above limit. The monthly payment is multiplied by 120 to convert
it to a comparable lump sum amount.

Average monthly income is the gross monthly remuneration from employment, averaged over the 12
months before the claim, and reduced by any income replacement disability benefits. If the life insured
has a fluctuating income, the average monthly income will be calculated over 36 months.

ADMITTANCE OF A CLAIM

Besides the conditions for admittance of a claim as set out in the general policy provisions, Sanlam Life
will admit a claim only if

•   the disability is caused directly and solely by a bodily injury or by an illness;
•   Sanlam Life has not previously admitted a claim for the same claim event.




GE 8/2006                                            BZ 26
CLAIM EVENTS

A benefit may be claimed if the life insured becomes disabled, and the disability amounts to one of the
following:

•   total, permanent and irrecoverable loss of
    −   the vision in two eyes, or
    −   the use of two hands, or
    −   the use of two feet, or
    −   the use of one hand and one foot

•   functional impairment to the extent that the life insured is totally, permanently and continuously
    −   unable to take care of his or her body, or take care of his or her personal interests, or
    −   unable to fulfil the occupational demands of the occupation he or she engaged in for income
        immediately before the functional impairment, or
    −   will be, if he or she is a full-time student when he or she becomes functionally impaired, unable to
        fulfil the occupational demands that Sanlam Life may reasonably expect him or her to engage in,
        taking into account his or her education, training, and experience.

Sanlam Life may reduce the benefit amount if the life insured is over insured.

EXCLUSIONS

Sanlam Life will not admit a claim if the disability of the life insured can be substantially removed or
improved by surgery or other medical treatment, which we can reasonably expect him or her to undergo,
taking into account the risks involved and the chances of success of such surgery or treatment.

If the life insured at any time engages in sport as an occupation, or works as a pilot, and becomes
continuously unable to fulfil the occupational demands of that occupation, Sanlam Life will not admit a
claim as a result of such inability.

Sanlam Life insure the ability to work, and not the availability of work.

The specific exclusions set out below are valid for disability benefits. See also the section regarding
general exclusions, which is also applicable to these benefits.

EXCLUSIONS FOR SPECIFIC CONDITIONS

Sanlam Life will not admit a claim if the disability directly or indirectly results from any of the following:

•   depression or dysthymia, whether as an episode or disorder, or as part of the symptom complex of
    another psychiatric diagnosis;
•   post-traumatic stress disorder;
•   fibromyalgia;
•   chronic fatigue syndrome and its synonyms;
•   a back condition, unless it qualifies as one of the following:
    −   paraplegia
    −   quadruplegia
    −   malignant tumors of the spinal cord and vertebral column
    −   failed back syndrome after multiple spinal surgery, provided the extent of the functional
        impairment arising therefrom is verified by a specialist nominated by Sanlam Life;
•   an injury or illness that directly or indirectly resulted from, or is traceable to, any of the above causes;
•   a complication that directly or indirectly is attributable to any of the above causes, or to such an injury
    or illness;
•   a side effect of treatment for any of the above causes, or for such an injury or illness, or for such a
    complication.

The benefit may also be taken without the exclusion of these specific conditions. In such a case a
loading is charged on the normal rates.




GE 8/2006                                            BZ 27
LIMITATION OF OCCUPATIONAL DISABILITY CLAIM

The cover amount can be limited in the event of a claim, but only if that is necessary to eliminate over-
insurance. For this purpose, Sanlam Life will follow the guidelines in the Code of good practice for
disability insurance of the Life Offices' Association of South Africa, applicable on the date a disability
claim is admitted, or a code or guidelines that replace it. This Code asks of all insurers to take care that
over-insurance does not occur, and to reduce disability benefits on a proportional basis to the extent that
this is reasonably necessary.

When Sanlam Life receives a claim, Sanlam Life will ask for full information of all insurance benefits the
policyholder has received or will receive because of the functional impairment in question.

The cover amount will not be reduced if a claim is admitted as a result of any of the following:

•   total, permanent and irrecoverable loss of
    −   the vision in two eyes, or
    −   the use of two hands, or
    −   the use of two feet, or
    −   the use of one hand and one foot

•   functional impairment to the extent that the life insured is totally, permanently and continuously unable
    to take care of his or her body, or take care of his or her personal interests.

If a claim is admitted during any of the 4 policy years before the policy anniversary before the life
insured’s 65th birthday, Sanlam will pay only a percentage of the cover amount as set out below. After
payment is made, the benefit will end.

    Policy year that begins on the policy anniversary
                                                                          % of the cover amount
            before or on the life insured’s …
                           61st birthday                                              80
                              nd
                           62        birthday                                         60
                                rd
                           63 birthday                                                40
                                th
                           64 birthday                                                20


    EXPLANATIONS

BACK CONDITION

A disease, disorder, or dysfunction of the vertebrae, spinal cord, intervertebral discs, nerve roots and
supporting muscles or ligaments, as well as the direct or indirect consequences of, or the side-effects of
any treatment applied for, such disease, disorder, or dysfunction.

PARAPLEGIA

Total, permanent and irrecoverable loss of function of both lower extremities, with or without loss of bowel
or bladder function.

QUADRUPLEGIA

Total, permanent and irrecoverable loss of function of all four limbs.




GE 8/2006                                          BZ 28
MALIGNANT TUMORS OF THE SPINAL CORD AND VERTEBRAL COLUMN

The incontrovertible presence of uncontrolled growth and spread of malignant cells, the invasion of
normal tissue, and the definite histological evidence of a malignant growth in the spinal cord and vertebral
column.

FAILED BACK SYNDROME AFTER MULTIPLE SPINAL SURGERY

When the life insured, after the cover for the benefit has began, must undergo more than one spinal
operation on two or more intervertebral disc spaces in the lumbar or cervical area, and despite those
operations, still suffers severe back pain as verified by a multidisciplinary pain clinic. Such operations
may include discectomy, vertebral fusion and internal fixation.

AVERAGE MONTHLY INCOME

The gross taxable monthly income from the life insured's regular occupation, after deducting any tax-
deductible expenses permitted under the income tax legislation applicable at the time, averaged over the
12 months before the claim event took place. If the life insured has a fluctuating income, we will calculate
the average monthly income over the 36 months before the claim event took place.




GE 8/2006                                         BZ 29
        DISABILITY FOR REGULAR AND REASONABLE ALTERNATIVE OCCUPATION
                                   (OAS, OSS)


DESCRIPTION

Sanlam will pay the cover amount as a lump sum if the life insured becomes disabled as defined before
the benefit cease age.

TYPE OF BENEFIT

This benefit may be selected as an accelerator (OAS) or stand-alone benefit (OSS).

GUARANTEE PERIODS

The client selects the guarantee period when taking out the policy. The following minimum and maximum
guarantee periods apply for both Matrix TopCover (except for 7% and 11% per year compulsory premium
growth with whole-life guarantee) and Matrix TermCover:
    •   Minimum : 5 years
    •   Maximum : 15 years

PREMIUM AND COVER GROWTH

Premium and cover growth is available according to the choice of growth selected by the policyholder.

INCEPTION AGES

    •   Minimum          :   When fixed compulsory premium growth is chosen, the minimum inception age is
                             30 next birthday. Otherwise a minimum of 15 next birthday applies.
    •   Maximum          :   60 age next birthday

BENEFIT CEASE AGE

65 next birthday

BENEFIT CEASE EVENTS

This benefit will end:
•   at midnight before the cover end date as set out in the policy overview, or
•   if the policy ends for any reason before the cover end date, or
•   if a claim is paid.

QUALIFYING LIVES

Persons who qualify for rate groups 1, 2, 3, 4 and 5 can apply for disability benefits.

Lives are further divided into 5 disability classes (A, B, C, D and E) (see Classes). Persons classified in
any of these classes A, B, C, D and E qualify for disability for regular and reasonable alternative
occupation.

Housewives, scholars, students and unemployed persons do not qualify for disability for regular and
reasonable alternative occupation.

RATE DIFFERENTIATION

Rate differentiation for the calculation of premiums takes place according to:
    •   Disability class (Occupation)
    •   Smoking habits
    •   Sex




GE 8/2006                                           BZ 30
LIMITS

Minimum       : R50 000 per life insured
Maximum       : R10 000 000 per life insured

The sum total of all the following benefits are taken into account when the permissible maximum amount
for disability benefits is determined:

•   functional impairment plus disability benefits (with Sanlam Life and all other insurers);
•   physical impairment (with Sanlam Life);
•   functional impairment (with Sanlam Life); and
•   disability benefits (lump sum, income benefits and waiver of premium)(with Sanlam Life and all other
    insurers).

Sanlam also restricts the available disability amounts according to income, as follows:

                   Age next birthday
                  (males and females)              Multiple of monthly taxable income

            Up to and including 30 anb              225 x average monthly income
            31 anb up to and including 35 anb       210 x average monthly income
            36 anb up to and including 40 anb       160 x average monthly income
            41 anb up to and including 45 anb       135 x average monthly income
            46 anb up to and including 50 anb       120 x average monthly income
            51 anb up to and including 55 anb        75 x average monthly income
            56 anb and older                       37,5 x average monthly income

The total disability benefit amount, payable from all sources, may not exceed the above limit. Income
Protector benefits (excluding temporary income protector) and waiver of premium benefits at disability are
also taken into account to determine the above limit. The monthly payment multiplied by 120 to convert it
to a comparable lump sum amount.

Average monthly income is the gross monthly remuneration from employment, averaged over the 12
months before the claim, and reduced by any income replacement disability benefits. If the life insured
has a fluctuating income, the average monthly income will be calculated over 36 months.

ADMITTANCE OF A CLAIM

Besides the conditions for admittance of a claim as set out in the general policy provisions, Sanlam Life
will admit a claim only if

•   the disability is caused directly and solely by a bodily injury or by an illness;
•   Sanlam Life has not previously admitted a claim for the same claim event.




GE 8/2006                                            BZ 31
CLAIM EVENTS

A benefit may be claimed if the life insured becomes disabled, and the disability amounts to one of the
following:

•   total, permanent and irrecoverable loss of
    −   the vision in two eyes, or
    −   the use of two hands, or
    −   the use of two feet, or
    −   the use of one hand and one foot

•   functional impairment to the extent that the life insured is totally, permanently and continuously
    −   unable to take care of his or her body, or take care of his or her personal interests, or
    −   unable to fulfil the occupational demands of the occupation he or she engaged in for income
        immediately before the functional impairment, as well as an occupation Sanlam Life may
        reasonably expect him or her to engage in, taking into account his or her education, training and
        experience, or
    −   will be, if he or she becomes a full-time student when he or she becomes functionally impaired,
        unable to fulfil the occupational demands that Sanlam Life may reasonably expect him or her to
        engage in, taking into account his or her education, training, and experience.

Sanlam Life may reduce the benefit amount if the life insured is over insured.

EXCLUSIONS

Sanlam Life will not admit a claim if the disability of the life insured can be substantially removed or
improved by surgery or other medical treatment, which we can reasonably expect him or her to undergo,
taking into account the risks involved and the chances of success of such surgery or treatment.

If the life insured engages at any time in sport as an occupation, or works as a pilot, and becomes
continuously unable to fulfill the occupational demands of that occupation, Sanlam Life will not admit a
claim as a result of such inability.

Sanlam Life insure the ability to work, and not the availability of work.

The specific exclusions set out further in this section are valid for disability benefits. See also the
section regarding general exclusions, which is also applicable to these benefits.

EXCLUSIONS FOR SPECIFIC CONDITIONS

Sanlam Life will not admit a claim if the disability directly or indirectly results from any of the following:

•   depression or dysthymia, whether as an episode or disorder, or as part of the symptom complex of
    another psychiatric diagnosis;
•   post-traumatic stress disorder;
•   fibromyalgia;
•   chronic fatigue syndrome and its synonyms;
•   a back condition, unless it qualifies as one of the following:
    −   paraplegia
    −   quadruplegia
    −   malignant tumors of the spinal cord and vertebral column
    −   failed back syndrome after multiple spinal surgery, provided the extent of the functional
        impairment arising therefrom is verified by a specialist nominated by Sanlam Life;
•   an injury or illness that directly or indirectly resulted from, or is traceable to, any of the above causes;
•   a complication that directly or indirectly is attributable to any of the above causes, or to such an injury
    or illness;
•   a side effect of treatment for any of the above causes, or for such an injury or illness, or for such a
    complication.

The benefit may also be taken without the exclusion of specific these conditions. In such a case a
loading is charged on the normal rates.




GE 8/2006                                            BZ 32
LIMITATION OF OCCUPATIONAL DISABILITY CLAIM

The cover amount can be limited in the event of a claim, but only if that is necessary to eliminate over-
insurance. For this purpose, Sanlam Life will follow the guidelines in the Code of good practice for
disability insurance of the Life Offices' Association of South Africa, applicable on the date a disability
claim is admitted, or a code or guidelines that replace it. This Code asks of all insurers to take care that
over-insurance does not occur, and to reduce disability benefits on a proportional basis to the extent that
this is reasonably necessary.

When Sanlam Life receives a claim, Sanlam Life will ask for full information of all insurance benefits the
policyholder has received or will receive because of the functional impairment in question.

The cover amount will not be reduced if a claim is admitted as a result of any of the following:

•   total, permanent and irrecoverable loss of
    −     the vision in two eyes, or
    −     the use of two hands, or
    −     the use of two feet, or
    −     the use of one hand and one foot
•   functional impairment to the extent that the life insured is totally, permanently and continuously unable
    to take care of his or her body, or take care of his or her personal interests.

If a claim is admitted during any of the 4 policy years before the policy anniversary before the life
insured’s 65th birthday, Sanlam will pay only a percentage of the cover amount as set out below. After
this payment is made, the benefit will end.

        Policy year that begins on the policy anniversary
                                                                         % of the cover amount
                before or on the life insured’s …
                           61st birthday                                             80
                             nd
                          62        birthday                                         60
                               rd
                           63 birthday                                               40
                           64th birthday                                             20


    EXPLANATIONS

BACK CONDITION

A disease, disorder, or dysfunction of the vertebrae, spinal cord, intervertebral discs, nerve roots and
supporting muscles or ligaments, as well as the direct or indirect consequences of, or the side-effects of
any treatment applied for, such disease, disorder, or dysfunction.

PARAPLEGIA

Total, permanent and irrecoverable loss of function of both lower extremities, with or without loss of bowel
or bladder function.

QUADRUPLEGIA

Total, permanent and irrecoverable loss of function of all four limbs.




GE 8/2006                                          BZ 33
MALIGNANT TUMORS OF THE SPINAL CORD AND VERTEBRAL COLUMN

The incontrovertible presence of uncontrolled growth and spread of malignant cells, the invasion of
normal tissue, and the definite histological evidence of a malignant growth in the spinal cord and vertebral
column.

FAILED BACK SYNDROME AFTER MULTIPLE SPINAL SURGERY

When the life insured, after the cover for the benefit has began, must undergo more than one spinal
operation on two or more intervertebral disc spaces in the lumbar or cervical area, and despite those
operations, still suffers severe back pain as verified by a multidisciplinary pain clinic. Such operations
may include discectomy, vertebral fusion and internal fixation.

AVERAGE MONTHLY INCOME

The gross taxable monthly income from the life insured's regular occupation, after deducting any tax-
deductible expenses permitted under the income tax legislation applicable at the time, averaged over the
12 months before the claim event took place. If the life insured has a fluctuating income, we will calculate
the average monthly income over the 36 months before the claim event took place.




GE 8/2006                                         BZ 34
                                 FUNCTIONAL IMPAIRMENT (OAF, OSF)



DESCRIPTION

Sanlam Life will pay the percentage of the cover amount linked to the particular claim event as set out
below.

TYPE OF BENEFIT

This benefit may be selected as an accelerator (OAF) or stand-alone benefit (OSF).

GUARANTEE PERIODS

The client selects the guarantee period when taking out the policy. The following minimum and maximum
guarantee periods apply for both Matrix TopCover (except for 7% and 11% per year compulsory premium
growth with whole-life guarantee) and Matrix TermCover:
    •   Minimum : 5 years
    •   Maximum : 15 years

For Matrix TopCover with compulsory premium growth at 7% or 11% per year a lifelong premium
guarantee applies. For the full term of the contract Sanlam Life will not increase the premium payable,
except for the contractual growth.

PREMIUM AND COVER GROWTH

Premium and cover growth is available according to the choice of growth selected by the policyholder.

INCEPTION AGES
    •   Minimum          :   When fixed compulsory premium growth is chosen, the minimum inception age is
                             30 next birthday. Otherwise a minimum of 15 next birthday applies.
    •   Maximum          :   60 age next birthday

BENEFIT CEASE AGE

65 next birthday

BENEFIT CEASE EVENTS

This benefit will end:
•   at midnight before the cover end date as set out in the policy overview, or
•   if the policy is ended for any reason before the cover end date, or
•   when the full cover amount is paid.

QUALIFYING LIVES

Persons who qualify for rate groups 1, 2, 3, 4 and 5 can apply for functional impairment benefits.

Lives are also divided into 5 disability classes (A, B, C, D and E) (see Classes). Persons classified in any
of these classes A, B, C, D and E qualify for disability for functional impairment.

RATE DIFFERENTIATION

Rate differentiation for the calculation of premiums takes place on account of:
    •   Disability class (Occupation)
    •   Smoking habits
    •   Sex




GE 8/2006                                           BZ 35
LIMITS

Minimum      : R50 000 per life insured
Maximum      : R10 000 000 per life insured

The sum total of all the following benefits are taken into account when the permissible maximum amount
for functional impairment benefits is determined:

•   functional impairment plus disability benefits (with Sanlam Life and all other insurers);
•   physical impairment (with Sanlam Life);
•   functional impairment (with Sanlam Life); and
•   disability benefits (lump sum, income benefits and waiver of premium)(with Sanlam Life and all other
    insurers).

Housewives, scholars, students and pensioners only qualify for a limited amount of functional impairment
benefits, namely:

        •   Housewives         :    Greater of R350 000 and 3 x income of spouse, but with a total
                                    maximum of R5 million
        •   Scholars           :    R300 000
        •   Students           :    R500 000
        •   Pensioners         :    Greater of R350 000 and 3 x income, but with a total maximum of
                                    R5 million

For housewives and pensioners only Sanlam assurance is taken into account.

ADMITTANCE OF A CLAIM

Besides the general conditions for admittance of a claim as set out earlier in this chapter, Sanlam Life will
admit a claim only if

•   the functional impairment is permanent, after the life insured has undergone optimal, reasonable
    treatment;
•   Sanlam Life has not previously admitted a claim for the same claim event;
•   the life insured survived the diagnosis of the claim event, or the incident causing the claim event,
    −   by more than 30 days without life support, or
    −   in cases where life support was used, by more than 30 days after he or she has been taken off life
        support.

If Sanlam Life has admitted a claim, Sanlam Life will reduce the cover amount of the benefit for the life
insured by the claim amount.

CLAIM EVENTS

A claim will be admitted only if the claim event is a permanent condition.

The functional impairment benefit covers valvular heart disease, cardiomyopathy, ischaemic heart
disease, arrhythmia, hypertension, peripheral arterial disease, haematopoitic system, peripheral venous
disease, diabetes mellitus, endocrine system, impairment of the respiratory system, central nervous
system, upper and lower digestive tract of the digestive system, liver, biliary tract, urinary tract, diabetes
mellitus (type I or II with target organ complications), locomotor system, spine, visual system, hearing
system, speech disorder, psychiatric conditions and cancer (malignancies).

If a claim is admitted, a percentage of the cover amount will be paid, depending on the claim event.

The claim events and percentages payable for the various claims events are set out in this section.

Besides the conditions for admittance of a claim set out in the general policy provisions, Sanlam Life will
admit a claim only if the claim event is a permanent condition.




GE 8/2006                                          BZ 36
EXCLUSIONS

Sanlam Life will not admit a claim if the functional impairment of the life insured can be substantially
removed or improved by surgery or other medical treatment, which Sanlam Life can reasonably expect
him or her to undergo, taking into account the risks involved and the chances of success of such surgery
or treatment.

Also see section regarding general exclusions, which is also applicable to these benefits.




GE 8/2006                                        BZ 37
FULL DESCRIPTION OF CLAIM EVENTS

If Sanlam Life admits a claim, a percentage of the cover amount, linked to the particular claim event as
set out below, will be paid.

The functional impairment must be permanent, and evaluated according to principles and ratings of the
latest edition of the American Medical Association's Guides to the Evaluation of Permanent Impairment.
The functional impairment, and whether it is permanent, will be evaluated only after the life insured has
undergone optimal, reasonable treatment, based on generally accepted medical protocols for treatment
of the condition in question at the time of the claim. Treatment already undergone, as well as treatment
still to be undergone, will be taken into account.

                                                                                      % of the cover
                                   Claim event
                                                                                         amount
 Valvular heart disease, cardiomyopathy
 •   New York Heart Association (NYHA) class III on optimal treatment, and
     − maximal effort test of 4 to 6 metabolic equivalents (METS), or                        50
     − valve gradient and/or valve area classified as severe
 •   NYHA class IV on optimal treatment, and
     − maximal effort test of less than 4 METS, or                                          100
     − valve gradient and/or valve area classified as severe
 Ischaemic heart disease
 •   NYHA Class III on optimal treatment, and
 •   maximal effort test of 4 to 6 METS, and
     − left ventricular ejection fraction (LVEF) of less than 45%, or
     − moderate diastolic dysfunction as determined by a cardiologist, taking
                                                                                             50
       into account the
       − cause of the dysfunction,
       − extent of ventricular hypertrophy, and
       − mitral inflow pattern as determined by echocardiography
 •   NYHA Class IV on optimal treatment, and
 •   maximal effort test of less than 4 METS, and
     − LVEF of less than 40%, or
     − severe diastolic dysfunction as determined by a cardiologist, taking into
                                                                                            100
       account the
       − cause of the dysfunction,
       − extent of ventricular hypertrophy, and
       − mitral inflow pattern as determined by echocardiography
 Arrhythmia
 •   Arrhythmia on optimal treatment that results in
     − NYHA Class III shortness of breath, and
     − 4 or less METS with maximal effort test; or                                           50
 •   documented arrhythmia that fails to respond to optimal treatment, and leads
     to frequent fainting spells
 •   Arrhythmia on optimal treatment that results in
     − NYHA class IV shortness of breath, and                                               100
     − 2 or less METS with maximal effort test
 Hypertension
 •   Stage II hypertension despite optimal treatment, and
                                                                                             50
 •   creatinine clearance of less than 50% of normal
 •   Stage III hypertension despite optimal treatment, and
                                                                                            100
 •   creatinine clearance of less than 20% of normal




GE 8/2006                                         BZ 38
                                                                                           % of the cover
                                    Claim event
                                                                                              amount
 Peripheral arterial disease
 •   Abnormal Doppler readings, cold leg, rubor and pain on exercise                            50
 •   No palpable pulses, confirmed by absent Doppler readings, or
 •   severe vascular ulceration, or                                                             100
 •   gangrene
 Peripheral venous disease
 •   Severe deep and widespread vascular ulceration                                             50

 Haematopoitic system
 •   Symptoms due to anaemia with the need for two to three units of blood every
                                                                                                100
     two weeks on a permanent basis
 Respiratory system
 •   Impaired airflow with
     − forced expiratory volume in one second (FEV1) of less than 50%, or                       50
     − forced vital capacity (FVC) of less than 50%
 •   Impaired airflow with
     − FEV1 of less than 40%, or                                                                100
     − FVC of less than 40%
 •   Impaired diffusion with diffusion capacity (DCO) of less than 50%                          50
 •   Impaired diffusion with DCO of less than 40%                                               100
 •   Impaired exercise tolerance with maximal effort test of 4 to 6 METS                        50
 •   Impaired exercise tolerance with maximal effort test of less than 4 METS                   100

 Central nervous system
 •   Coma                                                                                       100
 •   Hemiplegia                                                                                 100
 •   Epilepsy                                                                                   50
 •   Clinical dementia rating in severe category                                                50
 •   Cranial nerve VII paralysis with severe unilateral upper motor neuron facial
     paralysis, involving more than 75% of the face muscles, and inability to                   50
     control eyelid closure
 •   Cranial nerve VIII paralysis or imbalance with moderately severe equilibrium
     impairment, with limitations of all activities of daily living (ADL), and requiring        50
     permanent assistance with self-care
 •   Cranial nerve VIII paralysis or imbalance with moderately severe equilibrium
     impairment, with limitations of all ADL, requiring permanent assistance with               75
     self-care, plus permanent confinement
 •   Cranial nerves IX, X or XII paralysis or dysarthria or dysphagia, with
     moderately severe dysarthria or dysphagia with hoarseness, nasal                           25
     regurgitation and aspiration of fluids
 •   Cranial nerves IX, X or XII paralysis or dysarthria or dysphagia, with severe
                                                                                                75
     inability to swallow without choking, with need for assistance and suctioning
 •   Neurologic impairment of respiration where the life insured is capable of
     spontaneous respiration, but is restricted to sitting, standing or limited                 50
     ambulation




GE 8/2006                                           BZ 39
                                                                                         % of the cover
                                    Claim event
                                                                                            amount
 Central nervous system (continued)
 •   Neurologic impairment of respiration where the life insured is capable of
     spontaneous respiration, but to such a limited degree that he or she is                  75
     permanently confined to bed
 •   Neurologic impairment of respiration where the life insured has no capacity
                                                                                              100
     for spontaneous respiration
 •   Neurologic impairment of the bladder where the life insured has no reflex or
                                                                                              25
     voluntary control of the bladder due to permanent neurologic impairment
 •   Neurologic anorectal impairment where the life insured has no reflex
     regulation or voluntary control of the anus or rectum due to permanent                   25
     neurologic impairment
 Gastro-intestinal system : upper and lower digestive tract
 •   Anatomic loss or alteration in gastro-intestinal tract with
     − medical evidence of organic disease, and
     − symptoms uncontrolled by adequate treatment, and                                       100
     − 25% weight loss below accepted desirable weight; or
 •   complete faecal incontinence
 •   Anatomic loss or alteration in gastro-intestinal tract with
     −  medical evidence of organic disease, and
     −  symptoms uncontrolled by adequate treatment, and
     −  15% weight loss below accepted desirable weight for a period exceeding                50
        a year, despite optimal treatment; or
 •   permanent stoma; or
 •   persistent, irreducible and irreparable protrusion of a hernia after surgery with
     bowel dysfunction and limitation in activities of daily living
 Gastro-intestinal system : liver
 •   Progressive chronic liver disease, and
 •   objective evidence of jaundice, and
                                                                                              100
 •   ascites or bleeding oesophageal varices within the last year, and
 •   25% weight loss below accepted desirable weight
 Gastro-intestinal system : biliary tract
 •   Irreparable biliary tract obstruction with persistent jaundice                           100

 Endocrine system
 •   Disorders of the hypothalamic pituitary axis, with permanent whole person
                                                                                              50
     impairment (WPI) exceeding 26%
 •   Hypoadrenalism, with permanent WPI exceeding 30%                                         50
 •   Hyperadrenocorticism, with permanent WPI exceeding 40%                                   50
 •   Phaeochromocytoma, with permanent WPI exceeding 30%                                      50

 Urinary tract
 •   Reduction in urinary tract function, with creatinine clearance of 28 to 42 ml
     per minute, or                                                                           50
 •   bladder or urethral disease resulting in complete urinary incontinence
 •   Urinary tract functional impairment,
     −   with creatinine clearance of less than 28 ml per minute, or                          100
     −   constant dialysis




GE 8/2006                                           BZ 40
                                                                                     % of the cover
                                   Claim event
                                                                                        amount
 Diabetes mellitus : type I or II with target organ complications
 •   Kidney functions impaired                                                       See urinary tract
 •   Retinopathy with visual impairment                                              See visual system
                                                                                      See ischaemic
 •   Ischaemic heart disease
                                                                                      heart disease
 Locomotor system : upper extremity
 •   60% or more impairment of the limb                                                     50
 •   90% impairment of the limb                                                             75

 Locomotor system : lower extremity
 •   60% or more impairment of the limb                                                     25
 •   90% impairment of the limb                                                             50

 Spine
 •   Chronic back and neck pain – per region                                                25
 •   Malignant tumors of the spinal cord and vertebral column                               50
 •   Paraplegia                                                                             100
 •   Quadruplegia                                                                           100

 Visual system
 •   Blindness of one eye                                                                   25
 •   Blindness of two eyes                                                                  100
 •   Bilateral visual impairment of 50%                                                     25

 Hearing
 •   Permanent binaural hearing loss of 60% or more                                         50
 •   Total and permanent hearing loss in two ears                                           100

 Speech disorder
 •   Total, permanent and irrecoverable loss of the ability to speak                        100

 Psychiatric conditions
 •   Certifiable mental conditions which results in permanent institutionalisation          100

 Cancer (malignancies)
 •   The cancer must have been optimally treated, and must have reached the stage of maximal medical
     improvement, before functional impairment can be assessed and a claim be considered. Any
     permanent functional impairment will then be rated according to the applicable criteria, as set out
     above.

If the amount Sanlam Life pays for a claim event is less than the full cover amount, Sanlam Life will
reduce the cover amount with the amount paid. Any amount Sanlam Life pays thereafter for a
subsequent claim event, will be based on the reduced cover amount. If, however, the subsequent claim
event and the preceding claim event are based on the same cause, and the percentage of the cover
amount linked to the subsequent claim event is higher than the percentage linked to the preceding claim
event, Sanlam Life will calculate the amount for payment of the subsequent claim event on the cover
amount before it was reduced. From the amount so calculated, Sanlam Life will deduct the amount paid
for the preceding claim, and pay the balance.




GE 8/2006                                          BZ 41
  EXPLANATIONS

NEW YORK HEART ASSOCIATION (NYHA) FUNCTIONAL CLASSIFICATION OF
CARDIAC DISEASE

A specialist physician or cardiologist must do the classification during a clinical examination according to
the following criteria:

     Class                                               Description
                 •   Individual has cardiac disease, not resulting in limitation of physical activity.
        I        •   Ordinary physical activity does not cause undue fatigue, palpitation, shortness of
                     breath or anginal pain.
                 •   Individual has cardiac disease, resulting in slight limitation of physical activity.
                 •   Is comfortable at rest and in the performance of ordinary, light, daily activities.
       II
                 •   Greater than ordinary physical activity, such as heavy physical exertion, results in
                     fatigue, palpitations, shortness of breath or anginal pain.
                 •   Individual has cardiac disease, resulting in marked limitation of physical activity.
                 •   Is comfortable at rest.
       III
                 •   Ordinary physical activity results in fatigue, palpitations, shortness of breath or anginal
                     pain.
                 •   Individual has cardiac disease, resulting in inability to carry on any physical activity
                     without discomfort.
       IV        •   Symptoms of inadequate cardiac output, pulmonary congestion, systemic congestion,
                     or anginal syndrome may be present, even at rest.
                 •   If physical activity is undertaken, discomfort is increased.

SEVERITY OF VALVE STENOSIS ACCORDING TO VALVE GRADIENT OR VALVE AREA

A specialist physician or cardiologist must do the classification with an echocardiogram.

                                           Mean valve gradient
      Severity of stenosis                                                         Valve area ± (cm2)
                                                (mm/Hg)
 Aortic valve
 •    Mild                                           < 25                                   > 1.5
 •    Moderate                                     25 – 50                                1.0 – 1.5
 •    Severe                                         > 50                                   < 1.0
 Mitral valve
 •    Mild                                            <5                                    > 1.5
 •    Moderate                                      5 - 10                                1.0 – 1.5
 •    Severe                                         > 10                                   < 1.0

HYPERTENSION IN ADULTS

A specialist physician must do the classification according to the following average blood pressure
recordings:


     Blood pressure                                    Hypertension categories
        recording                    Stage I                     Stage II                     Stage III
 Systolic                           140 – 159                   160 – 179                       > 180
 Diastolic                           90 – 99                    100 – 109                       > 110




GE 8/2006                                           BZ 42
PERIPHERAL ARTERIAL AND VENOUS DISEASE

For peripheral arterial and venous disease, only one claim will be allowed, irrespective of whether one or
two legs are affected. No subsequent claims are allowed for the same condition if it re-occurs, or
manifests in another limb, or if the disease progresses to the stage of amputation.

RESPIRATORY SYSTEM

Impaired exercise tolerance must be caused by proven respiratory disease, and be accompanied by
either impaired airflow or impaired diffusion.

For impairment due to a respiratory disease, parameters must be measured after reasonable and
adequate therapy, which comprises
•   bronchodilator on demand, and
•   daily high dose inhaled cortico-steroid (more than 100 mg beclomethasone or equivalent), and
•   daily, or every other day, systemic cortico-steroid.

Lung function testing must be done only once the disease has stabilised, became chronic and is
permanent. At least three abnormal lung function tests, taken at least one month apart, must be
submitted. The average of the values submitted will be used in the assessment of the validity of the
claim.

To optimise patient co-operation and ensure reliable and consistent results, all lung function
measurements must
•   be done by a registered pulmonologist,
•   be done on a calibrated apparatus, and
•   include at least three flow volume curves with less than 5% inter-test variability.

To evaluate permanent impairment due to asthma, lung function testing must be done between acute
attacks, and not during an attack. Post-bronchodilator reversibility must also be measured.

COMA

Irreversible permanent condition of unconsciousness, presenting with a Glascow Coma Scale of 8 or
less, and requiring total medical support.

HEMIPLEGIA

The affected limbs must be permanently paralised.

EPILEPSY

Documented epileptic attacks confirmed by an abnormal electro-encephalogram (EEG) reading. Attacks
must be observed to be more than 3 per week, and be resistant to optimal therapy as confirmed by drug
serum-level testing.

CLINICAL DEMENTIA

All of the following criteria must be met:

•   severe memory loss, with only fragments remaining
•   oriented to person only
•   unable to make judgements to solve problems
•   no independent function outside home
•   too ill to be taken to functions outside home
•   no significant functioning in home
•   requires frequent help with self-care
•   frequent incontinence.




GE 8/2006                                           BZ 43
WHOLE PERSON IMPAIRMENT (WPI)

Any organ, system or limb may have impaired function after a bodily injury or illness. These impairments
can be rated as percentages of impaired function according to the American Medical Association's
Guides to the Evaluation of Permanent Impairment. Whole person impairment reflects the combined
impact of the impairments on the individual's overall ability as a person to perform activities of daily living.

CHRONIC BACK AND NECK PAIN

The neck and back are part of the spine. Only one claim for spinal pain will be allowed per spinal region.
The spinal regions are
•   the cervical region (C1 to C7),
•   the thoracic region (T1 to T12), and
•   the lumbosacral region (L1 to S1).

The C7 to T1 joint will be classified in the cervical region, and the T12 to L1 joint in the lumbosacral
region.

One of the following four diagnoses must be made as the cause of chronic pain:
•   50% compression of a vertebral body
•   clinically significant radiculopathy, verified by an imaging study that confirms a herniated disc at the
    level and side as found clinically, and verified by electrodiagnostic testing
•   alteration of motion segment integrity (instability), using flexion and extension radiographs
•   a back or cervical operation comprising laminectomy, discectomy or fusion, or a combination thereof.

In all four of the above diagnoses the clinical findings, pain distribution and findings on special
examinations, must make pathophysiological sense.

The chronic pain will be evaluated by the following criteria:
•   pain questionnaire
•   pain diagram
•   analgesic medication usage.

MALIGNANT TUMORS OF THE SPINAL CORD AND VERTEBRAL COLUMN

The incontrovertible presence of uncontrolled growth and spread of malignant cells, the invasion of
normal tissue, and the definite histological evidence of malignant growth in the spinal cord and vertebral
column.

PARAPLEGIA

Total, permanent and irrecoverable loss of function of both lower extremities, with or without loss of bowel
or bladder function.

QUADRUPLEGIA

Total, permanent and irrecoverable loss of function of all four limbs.

BLINDNESS

Total, permanent and irrecoverable loss of the vision of an eye as a result of illness or injury, or the
certification of the life insured as legally blind by a registered ophthalmic surgeon.




GE 8/2006                                           BZ 44
                                  PHYSICAL IMPAIRMENT (OAP, OSP)



DESCRIPTION

Sanlam Life will pay the percentage of the cover amount linked to the particular claim event as set out
below.

TYPE OF BENEFIT

This benefit may be selected as an accelerator (OAP) or stand-alone benefit (OSP).

GUARANTEE PERIODS

The client selects the guarantee period when taking out the policy. The following minimum and maximum
guarantee periods apply for both Matrix TopCover (except for 7% and 11% per year compulsory premium
growth with whole-life guarantee) and Matrix TermCover:

    •       Minimum   : 5 year
    •       Maximum   : 15 year

For Matrix TopCover with compulsory premium growth at 7% or 11% per year a lifelong premium
guarantee applies. For the full term of the contract Sanlam Life will not increase the premium payable,
except for the contractual growth.

PREMIUM AND COVER GROWTH

Premium and cover growth is available according to the choice of growth selected by the policyholder.

INCEPTION AGES

        •   Minimum      :   When fixed compulsory premium growth is chosen, the minimum inception age
                             is 30 next birthday. Otherwise a minimum of 15 next birthday applies.
        •   Maximum      :   60 age next birthday

BENEFIT CEASE AGE

65 next birthday

BENEFIT CEASE EVENTS

This benefit will end:

•   at midnight before the cover end date as set out in the policy overview, or
•   if the policy ends for any reason before the cover end date, or
•   when the full cover amount has been paid.

QUALIFYING LIVES

Persons who qualify for rate groups 1, 2, 3, 4 and 5 can apply for physical impairment.

Lives are also divided into 5 disability classes (A, B, C, D and E) (see Classes). Persons classified in any
of these classes A, B, C, D and E qualify for physical impairment.




GE 8/2006                                          BZ 45
RATE DIFFERENTIATION

Rate differentiation for the calculation of premiums takes place on account of:
    •   Disability class (Occupation)
    •   Smoking habits
    •   Sex

LIMITS

Minimum        : R50 000 per life insured
Maximum        : R2 500 000 per life insured

All physical impairment benefits (both whole life and non whole life physical impairment benefits), already
provided by Sanlam Life on the life of the insured, will be taken into account to determine the maximum
physical impairment benefits allowed.

The sum total of all the following benefits may not exceed R10 million:

•   physical impairment (with Sanlam Life);
•   functional impairment (with Sanlam Life);
•   combination of functional impairment plus disability (with Sanlam Life and all other insurers); and
•   disability benefits (lump sums, income benefits and premium waiver)(with Sanlam Life and all other
    insurers).

Housewives, scholars, students and pensioners only qualify for a limited amount of physical impairment
benefits, namely:

        •   Housewives         :    Greater of R350 000 and 3 x income of spouse, but with a total
                                    maximum of R1,5 million
        •   Scholars           :    R300 000
        •   Students           :    R500 000
        •   Pensioners         :    Greater of R350 000 and 3 x income, but with a total maximum of
                                    R1,5 million

ADMITTANCE OF A CLAIM

Besides the general conditions for admittance of a claim as set out earlier in this chapter, Sanlam Life will
admit a claim only if

•   the physical impairment is permanent, after the life insured has undergone optimal, reasonable
    treatment;
•   Sanlam Life has not previously admitted a claim for the same claim event;
•   the life insured survived the diagnosis of the claim event, or the incident causing the claim event,
    −   by more than 30 days without life support, or
    −   in cases where life support was used, by more than 30 days after he or she has been taken off life
        support.
    −   in cases of confinement to a bed or a wheelchair due to cancer, by more than 6 months.

The policyholder is responsible for premium payments during the waiting period.

If Sanlam Life has admitted a claim, Sanlam Life will reduce the cover amount of the benefit for the life
insured by the claim amount.




GE 8/2006                                          BZ 46
EXCLUSIONS

Sanlam Life will not admit a claim if the impairment of the life insured can be substantially removed or
improved by surgery or other medical treatment, which we can reasonably expect him or her to undergo,
taking into account the risks involved and the chances of success of such surgery or treatment.

Other general exclusions are set out in the general policy provisions. See the section regarding general
exclusions, which is also applicable to these benefits.

Specific exclusions, if any, are set out in the policy overview, in the special provisions for the life insured
concerned.

CLAIM EVENTS

The physical impairment benefit covers the total and permanent loss of one or both feet, legs, hands,
arms, eyes, permanent loss of speech or hearing, amputation of fingers, permanent confinement to a bed
or wheelchair and burns.

If a claim is admitted, a percentage of the cover amount will be paid, depending on the claim event.

Besides the conditions for admittance of a claim set out in the general policy provisions, Sanlam Life will
admit a claim only if the claim event is a permanent condition.




GE 8/2006                                          BZ 47
FULL DESCRIPTION OF CLAIM EVENTS

The physical impairment must be permanent, and evaluated according to principles and ratings of the
latest edition of the American Medical Association's Guides to the Evaluation of Permanent Impairment.
The physical impairment, and whether it is permanent, will be evaluated only after the life insured has
undergone optimal, reasonable treatment, based on generally accepted medical protocols for treatment
of the condition in question at the time of the claim. Treatment already undergone, as well as treatment
still to be undergone, will be taken into account.

If Sanlam Life admits a claim, a percentage of the cover amount, as set out below, will be paid,
depending on the claim event.


                         Claim event                                     % of cover amount
 Loss of function, excluding amputation
 •   One foot                                                                      30
 •   One leg                                                                       50
 •   One hand                                                                      50
 •   One arm                                                                       60

 Total vision loss
 •   One eye                                                                       30
 •   Two eyes                                                                      100
 Loss of speech                                                                    50
 Total hearing loss
 •   One ear                                                                       10
 •   Two ears                                                                      50

 Amputation
 •   One thumb                                                                     15
 •   Three fingers, other than thumb                                               15
 •   Three fingers plus thumb                                                      30
 •   One foot                                                                      30
 •   One leg                                                                       50
 •   One hand                                                                      50
 •   One arm                                                                       60
 Loss of function, or amputation, of any 2 of the following
 resulting from the same cause, provided they are not part of
 the same limb:
 •   a foot
 •   a leg                                                                         100

 •   a hand
 •   an arm
 •   vision in an eye
 Loss of function, or amputation, of any of the following
 resulting from the same cause:
 • two feet
 •   two legs                                                                      100
 •   two hands
 •   two arms
 Permanent confinement to a bed or a wheelchair                                    100



GE 8/2006                                       BZ 48
FULL DESCRIPTION OF CLAIM EVENTS (continued)

                              Claim event                                      % of cover amount
    Third degree burns covering at least …
    •    20% of total body surface                                                        50
    •    40% of total body surface                                                       100

If the amount Sanlam Life pays for a claim event is less than the full cover amount, Sanlam Life will
reduce the cover amount with the amount paid. Any amount Sanlam Life pays thereafter for a
subsequent claim event, will be based on the reduced cover amount. If, however, the subsequent claim
event and the preceding claim event based on the same cause, and the percentage of the cover amount
linked to the subsequent claim event is higher than the percentage linked to the preceding claim event,
Sanlam Life will calculate the amount for payment of the subsequent claim event on the cover amount
before it was reduced. From the amount so calculated, Sanlam Life will deduct the amount paid for the
preceding claim, and pay the balance.


    EXPLANATIONS

FOOT

•       Loss of function refers to the permanent loss of more than 90% of the use of a foot. For this purpose
        a foot includes the ankle joint.
•       Amputation refers to the complete physical severence of a leg below the knee.

LEG

•       Loss of function refers to the permanent loss of more than 90% of the use of a leg. For this purpose a
        leg includes the hip joint.
•       Amputation refers to the complete physical severence of a leg through or above the knee.

HAND

•       Loss of function refers to the permanent loss of more than 90% of the use of a hand. For this purpose
        a hand includes the wrist joint.
•       Amputation refers to the complete physical severence of an arm below the elbow.

ARM

•       Loss of function refers to the permanent loss of more than 90% of the use of an arm. For this
        purpose an arm includes the shoulder joint.
•       Amputation refers to the complete physical severence of an arm above the elbow.

TOTAL VISION LOSS

Total, permanent and irrecoverable loss of vision in an eye.

LOSS OF SPEECH

Total, permanent and irrecoverable loss of the ability to speak.

TOTAL HEARING LOSS

Total, permanent and irrecoverable loss of hearing in an ear.

FINGER

Complete physical severence of a finger through the metacarpo-phalangeal (MP) joint.




GE 8/2006                                            BZ 49
                         WHOLE LIFE PHYSICAL IMPAIRMENT (OAP2, OSP2)



DESCRIPTION

Sanlam Life will pay the percentage of the cover amount linked to the particular claim event as set out
below.

TYPE OF BENEFIT

This benefit may be selected as an accelerator (OAP2) or stand-alone benefit (OSP2).

GUARANTEE PERIODS

The client selects the guarantee period when taking out the policy. The following minimum and maximum
guarantee periods apply for Matrix TopCover (except for 7% and 11% per year compulsory premium
growth with whole-life guarantee):

    •       Minimum   : 5 year
    •       Maximum   : 15 year

For Matrix TopCover with compulsory premium growth at 7% or 11% per year a lifelong premium
guarantee applies. For the full term of the contract Sanlam Life will not increase the premium payable,
except for the contractual growth.

PREMIUM AND COVER GROWTH

Premium and cover growth is available according to the choice of growth selected by the policyholder.

INCEPTION AGES

        •   Minimum      :   When fixed compulsory premium growth is chosen, the minimum inception age
                             is 30 next birthday. Otherwise a minimum of 15 next birthday applies.
        •   Maximum      :   60 age next birthday

BENEFIT CEASE AGE

Whole life

BENEFIT CEASE EVENTS

This benefit will end:

•   at midnight before the cover end date as set out in the policy overview, or
•   if the policy ends for any reason before the cover end date, or
•   when the full cover amount has been paid.

QUALIFYING LIVES

Persons who qualify for rate groups 1, 2, 3, 4 and 5 can apply for whole life physical impairment.

Lives are also divided into 5 disability classes (A, B, C, D and E) (see Classes). Persons classified in any
of these classes A, B, C, D and E qualify for whole life physical impairment.




GE 8/2006                                          BZ 50
RATE DIFFERENTIATION

Rate differentiation for the calculation of premiums takes place on account of:
    •   Disability class (Occupation)
    •   Smoking habits
    •   Sex

LIMITS

Minimum        : R50 000 per life insured
Maximum        : R2 500 000 per life insured

All physical impairment benefits (both whole life and non whole life physical impairment benefits), already
provided by Sanlam Life on the life of the insured, will be taken into account to determine the maximum
whole life physical impairment benefits allowed.

The sum total of all the following benefits may not exceed R10 million:

•   physical impairment (with Sanlam Life);
•   functional impairment (with Sanlam Life);
•   combination of functional impairment plus disability (with Sanlam Life and all other insurers); and
•   disability benefits (lump sums, income benefits and premium waiver)(with Sanlam Life and all other
    insurers).

Housewives, scholars, students and pensioners only qualify for a limited amount of whole life physical
impairment benefits, namely:

        •   Housewives         :    Greater of R350 000 and 3 x income of spouse, but with a total
                                    maximum of R1,5 million
        •   Scholars           :    R300 000
        •   Students           :    R500 000
        •   Pensioners         :    Greater of R350 000 and 3 x income, but with a total maximum of
                                    R1,5 million

ADMITTANCE OF A CLAIM

Besides the general conditions for admittance of a claim as set out earlier in this chapter, Sanlam Life will
admit a claim only if

•   the physical impairment is permanent, after the life insured has undergone optimal, reasonable
    treatment;
•   Sanlam Life has not previously admitted a claim for the same claim event;
•   the life insured survived the diagnosis of the claim event, or the incident causing the claim event,
    −   by more than 30 days without life support, or
    −   in cases where life support was used, by more than 30 days after he or she has been taken off life
        support.
    −   in cases of confinement to a bed or a wheelchair due to cancer, by more than 6 months.

The policyholder is responsible for premium payments during the waiting period.

If Sanlam Life has admitted a claim, Sanlam Life will reduce the cover amount of the benefit for the life
insured by the claim amount.




GE 8/2006                                          BZ 51
EXCLUSIONS

Sanlam Life will not admit a claim if the impairment of the life insured can be substantially removed or
improved by surgery or other medical treatment, which we can reasonably expect him or her to undergo,
taking into account the risks involved and the chances of success of such surgery or treatment.

Other general exclusions are set out in the general policy provisions. See the section regarding general
exclusions, which is also applicable to these benefits.

Specific exclusions, if any, are set out in the policy overview, in the special provisions for the life insured
concerned.

CLAIM EVENTS

The whole life physical impairment benefit covers the permanent loss of function of one or both feet, legs,
hands, arms, eyes, permanent loss of speech or hearing, amputation of fingers, feet, legs, hands and
arms, permanent confinement to a bed or wheelchair and burns.

If a claim is admitted, a percentage of the cover amount will be paid, depending on the claim event.

Besides the conditions for admittance of a claim set out in the general policy provisions, Sanlam Life will
admit a claim only if the claim event is a permanent condition.




GE 8/2006                                          BZ 52
FULL DESCRIPTION OF CLAIM EVENTS

The physical impairment must be permanent, and evaluated according to principles and ratings of the
latest edition of the American Medical Association's Guides to the Evaluation of Permanent Impairment.
The physical impairment, and whether it is permanent, will be evaluated only after the life insured has
undergone optimal, reasonable treatment, based on generally accepted medical protocols for treatment
of the condition in question at the time of the claim. Treatment already undergone, as well as treatment
still to be undergone, will be taken into account.

If Sanlam Life admits a claim, a percentage of the cover amount, as set out below, will be paid,
depending on the claim event.

                         Claim event                                     % of cover amount
 Loss of function, excluding amputation
 •   One foot                                                                      30
 •   One leg                                                                       50
 •   One hand                                                                      50
 •   One arm                                                                       60

 Total vision loss
 •   One eye                                                                       30
 •   Two eyes                                                                      100
 Loss of speech                                                                    50
 Total hearing loss
 •   One ear                                                                       10
 •   Two ears                                                                      50

 Amputation
 •   One thumb                                                                     15
 •   Three fingers, other than thumb                                               15
 •   Three fingers plus thumb                                                      30
 •   One foot                                                                      30
 •   One leg                                                                       50
 •   One hand                                                                      50
 •   One arm                                                                       60
 Loss of function, or amputation, of any 2 of the following
 resulting from the same cause, provided they are not part of
 the same limb:
 •   a foot
                                                                                   100
 •   a leg
 •   a hand
 •   an arm
 •   vision in an eye
 Loss of function, or amputation, of any of the following
 resulting from the same cause:
 •   two feet
                                                                                   100
 •   two legs
 •   two hands
 •   two arms
 Permanent confinement to a bed or a wheelchair                                    100



GE 8/2006                                       BZ 53
FULL DESCRIPTION OF CLAIM EVENTS (continued)

                              Claim event                                      % of cover amount
    Third degree burns covering at least …
    •    20% of total body surface                                                        50
    •    40% of total body surface                                                      100

From the life insured's 70th birthday, we will admit a claim for permanent confinement to a bed or a
wheelchair only if the confinement results from an accident.

If the amount Sanlam Life pays for a claim event is less than the full cover amount, Sanlam Life will
reduce the cover amount with the amount paid. Any amount Sanlam Life pays thereafter for a
subsequent claim event, will be based on the reduced cover amount. If, however, the subsequent claim
event and the preceding claim event based on the same cause, and the percentage of the cover amount
linked to the subsequent claim event is higher than the percentage linked to the preceding claim event,
Sanlam Life will calculate the amount for payment of the subsequent claim event on the cover amount
before it was reduced. From the amount so calculated, Sanlam Life will deduct the amount paid for the
preceding claim, and pay the balance.


    EXPLANATIONS

FOOT

•       Loss of function refers to the permanent loss of more than 90% of the use of a foot. For this purpose
        a foot includes the ankle joint.
•       Amputation refers to the complete physical severence of a leg below the knee.

LEG

•       Loss of function refers to the permanent loss of more than 90% of the use of a leg. For this purpose a
        leg includes the hip joint.
•       Amputation refers to the complete physical severence of a leg through or above the knee.

HAND

•       Loss of function refers to the permanent loss of more than 90% of the use of a hand. For this purpose
        a hand includes the wrist joint.
•       Amputation refers to the complete physical severence of an arm below the elbow.

ARM

•       Loss of function refers to the permanent loss of more than 90% of the use of an arm. For this
        purpose an arm includes the shoulder joint.
•       Amputation refers to the complete physical severence of an arm above the elbow.

TOTAL VISION LOSS

Total, permanent and irrecoverable loss of vision in an eye.

LOSS OF SPEECH

Total, permanent and irrecoverable loss of the ability to speak.

TOTAL HEARING LOSS

Total, permanent and irrecoverable loss of hearing in an ear.

FINGER

Complete physical severence of a finger through the metacarpo-phalangeal (MP) joint.




GE 8/2006                                            BZ 54
                   FUNCTIONAL IMPAIRMENT PLUS DISABILITY FOR REGULAR
                                 OCCUPATION (CAR, CSR)

DESCRIPTION

Sanlam Life will pay the percentage of the cover amount linked to the particular claim event as set out
below.

TYPE OF BENEFIT

This benefit may be selected as an accelerator (CAR) or stand-alone benefit (CSR).

GUARANTEE PERIODS

The client selects the initial guarantee period when taking out the policy. The following minimum and
maximum guarantee periods apply for both Matrix TopCover (except for 7% and 11% per year
compulsory premium growth with whole-life guarantee) and Matrix TermCover:

    •       Minimum   : 5 year
    •       Maximum   : 15 year

For Matrix TopCover with compulsory premium growth at 7% or 11% per year a lifelong premium
guarantee applies. For the full term of the contract Sanlam Life will not increase the premium payable,
except for the contractual growth.

PREMIUM AND COVER GROWTH

Premium and cover growth is available according to the choice of growth selected by the policyholder.

INCEPTION AGES

        •   Minimum      :   When fixed compulsory premium growth is chosen, the minimum inception age
                             is 30 next birthday. Otherwise a minimum of 15 next birthday applies.
        •   Maximum      :   60 age next birthday

BENEFIT CEASE AGE

65 next birthday

BENEFIT CEASE EVENTS

This benefit will end:

•   at midnight before the cover end date as set out in the policy overview, or
•   if the policy ends for any reason before the cover end date, or
•   when the full cover amount has been paid.

QUALIFYING LIVES

Persons who qualify for rate groups 1, 2, 3, 4 and 5 can apply for functional impairment plus disability
benefits.

Lives are also divided into 5 disability classes (A, B, C, D and E) (see Classes). Persons classified in
classes A, B, and C, qualify for functional impairment plus disability for regular occupation.

Housewives, scholars, students and unemployed persons do not qualify for functional impairment plus
disability for regular occupation.




GE 8/2006                                          BZ 55
RATE DIFFERENTIATION

Rate differentiation for the calculation of premiums takes place on account of:
    •   Disability class (Occupation)
    •   Smoking habits
    •   Sex

LIMITS

Minimum        : R50 000 per life insured
Maximum        : R10 000 000 per life insured

The sum total of all the following benefits is taken into account when the permissible maximum amount
for functional impairment plus disability benefits is determined:

•   functional impairment plus disability benefits (with Sanlam Life and all other insurers);
•   physical impairment (with Sanlam Life);
•   functional impairment (with Sanlam Life);
•   disability benefits (lump sums, income benefits and premium waiver)(with Sanlam Life and all other
    insurers).

Sanlam also restricts the available benefit amounts according to income, as follows:

                   Age next birthday
                  (males and females)             Multiple of monthly taxable income

            Up to and including 30 anb            225 x average monthly income
            31 anb up to and including 35 anb     210 x average monthly income
            36 anb up to and including 40 anb     160 x average monthly income
            41 anb up to and including 45 anb     135 x average monthly income
            46 anb up to and including 50 anb     120 x average monthly income
            51 anb up to and including 55 anb       75 x average monthly income
            56 anb and older                      37,5 x average monthly income

The total disability benefit amount, payable from all sources, may not exceed the above limit. Income
Protector benefits (excluding temporary income protector) and waiver of premium benefits at disability are
also taken into account to determine the above limit. The monthly payment is multiplied by 120 to convert
it to a comparable lump sum amount.

Average monthly income is the gross monthly remuneration from employment, averaged over the 12
months before the claim, and reduced by any income replacement disability benefits. If the life insured
has a fluctuating income, the average monthly income will be calculated over 36 months.

ADMITTANCE OF A CLAIM

Besides the general conditions for admittance of a claim as set out earlier in this chapter, Sanlam Life will
admit a claim only if

•   the functional impairment is caused directly and solely by a bodily injury or by an illness;
•   the functional impairment is permanent, after the life insured has undergone optimal, reasonable
    treatment;
•   Sanlam Life has not previously admitted a claim for the same claim event;
•   the life insured survived the diagnosis of the claim event, or the incident causing the claim event,
    −   by more than 30 days without life support, or
    −   in cases where life support was used, by more than 30 days after he or she has been taken off life
        support.

If Sanlam Life has admitted a claim, Sanlam Life will reduce the cover amount of the benefit for the life
insured by the claim amount.




GE 8/2006                                          BZ 56
EXCLUSIONS

Sanlam Life will not admit a claim if the functional impairment of the life insured can be substantially
removed or improved by surgery or other medical treatment, which Sanlam Life can reasonably expect
him or her to undergo, taking into account the risks involved and the chances of success of such surgery
or treatment.

If the life insured at any time engages in sport as an occupation, or works as a pilot, and becomes
continuously unable to fulfill the occupational demands of that occupation, Sanlam Life will not admit a
claim as a result of such inability.

Other general exclusions are set out in the general policy provisions. See the section regarding general
exclusions, which is also applicable to these benefits.

Exclusions for specific conditions

Sanlam Life will not admit a claim for occupational disability if the functional impairment directly or
indirectly resulted from any of the following:

•   depression or dysthymia, whether as an episode or disorder, or as part of the symptom complex of
    another psychiatric diagnosis;
•   post-traumatic stress disorder;
•   fibromyalgia;
•   chronic fatigue syndrome and its synonyms;
•   a back condition, unless it qualifies as one of the following:
    −   paraplegia
    −   quadruplegia
    −   malignant tumors of the spinal cord and vertebral column
    −   failed back syndrome after multiple spinal surgery, provided the extent of the functional
        impairment arising therefrom is verified by a specialist that Sanlam Life will nominate;
•   an injury or illness that directly or indirectly resulted from, or is traceable to, any of the above causes;
•   a complication that directly or indirectly is attributable to any of the above causes, or to such an injury
    or illness;
•   a side effect of treatment for any of the above causes, or for such an injury or illness, or for such a
    complication.




GE 8/2006                                           BZ 57
CLAIM EVENT

The functional impairment must be permanent, and evaluated according to principles and ratings of the
latest edition of the American Medical Association's Guides to the Evaluation of Permanent Impairment.
The functional impairment, and whether it is permanent, will be evaluated only after the life insured has
undergone optimal, reasonable treatment, based on generally accepted medical protocols for treatment
of the condition in question at the time of the claim. Treatment already undergone, as well as treatment
still to be undergone, will be taken into account.


                               Claim event                                   % of the cover amount

 Valvular heart disease, cardiomyopathy
 •   New York Heart Association (NYHA) class III on optimal treatment,
     and
                                                                                         50
     − maximal effort test of 4 to 6 metabolic equivalents (METS), or
     − valve gradient and/or valve area classified as severe
 •   NYHA class IV on optimal treatment, and
     − maximal effort test of less than 4 METS, or                                       100
     − valve gradient and/or valve area classified as severe
 Ischaemic heart disease
 •   NYHA Class III on optimal treatment, and
 •   maximal effort test of 4 to 6 METS, and
     − left ventricular ejection fraction (LVEF) of less than 45%, or
     − moderate diastolic dysfunction as determined by a cardiologist,
                                                                                         50
       taking into account the
       − cause of the dysfunction,
       − extent of ventricular hypertrophy, and
       − mitral inflow pattern as determined by echocardiography
 •   NYHA Class IV on optimal treatment, and
 •   maximal effort test of less than 4 METS, and
     − LVEF of less than 40%, or
     − severe diastolic dysfunction as determined by a cardiologist,
                                                                                         100
       taking into account the
       − cause of the dysfunction,
       − extent of ventricular hypertrophy, and
       − mitral inflow pattern as determined by echocardiography
 Arrhythmia
 •   Arrhythmia on optimal treatment that results in
     − NYHA Class III shortness of breath, and
     − 4 or less METS with maximal effort test; or                                       50
 •   documented arrhythmia that fails to respond to optimal treatment, and
     leads to frequent fainting spells
 •   Arrhythmia on optimal treatment that results in
     − NYHA Class IV shortness of breath, and                                            100
     − 2 or less METS with maximal effort test
 Hypertension
 •   Stage II hypertension despite optimal treatment, and
                                                                                         50
 •   creatinine clearance of less than 50% of normal
 •   Stage III hypertension despite optimal treatment, and
                                                                                         100
 •   creatinine clearance of less than 20% of normal




GE 8/2006                                         BZ 58
                                Claim event                                       % of the cover amount

 Peripheral arterial disease
 •   Abnormal Doppler readings, cold leg, rubor and pain on exercise                       50
 •   No palpable pulses, confirmed by absent Doppler readings, or
 •   severe vascular ulceration, or                                                        100
 •   gangrene
 Peripheral venous disease
 •   Severe deep and widespread vascular ulceration                                        50

 Haematopoitic system
 •   Symptoms due to anaemia with the need for two to three units of
                                                                                           100
     blood every two weeks on a permanent basis
 Respiratory system
 •   Impaired airflow with
     − forced expiratory volume in one second (FEV1) of less than 50%,
                                                                                           50
        or
     − forced vital capacity (FVC) of less than 50%
 •   Impaired airflow with
     − FEV1 of less than 40%, or                                                           100
     − FVC of less than 40%
 •   Impaired diffusion with diffusion capacity (DCO) of less than 50%                     50
 •   Impaired diffusion with DCO of less than 40%                                          100
 •   Impaired exercise tolerance with maximal effort test of 4 to 6 METS                   50
 •   Impaired exercise tolerance with maximal effort test of less than 4
                                                                                           100
     METS
 Central nervous system
 •   Coma                                                                                  100
 •   Hemiplegia                                                                            100
 •   Epilepsy                                                                              50
 •   Clinical dementia rating in severe category                                           50
 •   Cranial nerve VII paralysis with severe unilateral upper motor neuron
     facial paralysis, involving more than 75% of the face muscles, and                    50
     inability to control eyelid closure
 •   Cranial nerve VIII paralysis or imbalance with moderately severe
     equilibrium impairment, with limitations of all activities of daily living            50
     (ADL), and requiring permanent assistance with self-care
 •   Cranial nerve VIII paralysis or imbalance with moderately severe
     equilibrium impairment, with limitations of all ADL, requiring                        75
     permanent assistance with self-care, plus permanent confinement
 •   Cranial nerves IX, X or XII paralysis or dysarthria or dysphagia, with
     moderately severe dysarthria or dysphagia with hoarseness, nasal                      25
     regurgitation and aspiration of fluids
 •   Cranial nerves IX, X or XII paralysis or dysarthria or dysphagia, with
     severe inability to swallow without choking, with need for assistance                 75
     and suctioning
 •   Neurologic impairment of respiration where the life insured is capable
     of spontaneous respiration, but is restricted to sitting, standing or                 50
     limited ambulation




GE 8/2006                                          BZ 59
                                 Claim event                                       % of the cover amount

 Central nervous system (continued)
 •   Neurologic impairment of respiration where the life insured is capable
     of spontaneous respiration, but to such a limited degree that he or she                75
     is permanently confined to bed
 •   Neurologic impairment of respiration where the life insured has no
                                                                                            100
     capacity for spontaneous respiration
 •   Neurologic impairment of the bladder where the life insured has no
     reflex or voluntary control of the bladder due to permanent neurologic                 25
     impairment
 •   Neurologic anorectal impairment where the life insured has no reflex
     regulation or voluntary control of the anus or rectum due to permanent                 25
     neurologic impairment
 Gastro-intestinal system : upper and lower digestive tract
 •   Anatomic loss or alteration in gastro-intestinal tract with
     − medical evidence of organic disease, and
     − symptoms uncontrolled by adequate treatment, and                                     100
     − 25% weight loss below accepted desirable weight; or
 •   complete faecal incontinence
 •   Anatomic loss or alteration in gastro-intestinal tract with
     −  medical evidence of organic disease, and
     −  symptoms uncontrolled by adequate treatment, and
     −  15% weight loss below accepted desirable weight for a period                        50
        exceeding a year, despite optimal treatment; or
 •   permanent stoma; or
 •   persistent, irreducible and irreparable protrusion of a hernia after
     surgery with bowel dysfunction and limitation in activities of daily living
 Gastro-intestinal system : liver
 •   Progressive chronic liver disease, and
 •   objective evidence of jaundice, and
                                                                                            100
 •   ascites or bleeding oesophageal varices within the last year, and
 •   25% weight loss below accepted desirable weight
 Gastro-intestinal system : biliary tract
 •   Irreparable biliary tract obstruction with persistent jaundice                         100

 Endocrine system
 •   Disorders of the hypothalamic pituitary axis, with permanent whole
                                                                                            50
     person impairment (WPI) exceeding 26%
 •   Hypoadrenalism, with permanent WPI exceeding 30%                                       50
 •   Hyperadrenocorticism, with permanent WPI exceeding 40%                                 50
 •   Phaeochromocytoma, with permanent WPI exceeding 30%                                    50

 Urinary tract
 •   Reduction in urinary tract function, with creatinine clearance of 28 to
     42 ml per minute, or                                                                   50
 •   bladder or urethral disease resulting in complete urinary incontinence
 •   Urinary tract functional impairment
     −   with creatinine clearance of less than 28 ml per minute, or                        100
     −   constant dialysis




GE 8/2006                                           BZ 60
                                 Claim event                                  % of the cover amount
 Diabetes mellitus : type I or II with target organ complications
 •   Kidney functions impaired                                                    See urinary tract
 •   Retinopathy with visual impairment                                          See visual system
                                                                                See ischaemic heart
 •   Ischaemic heart disease
                                                                                      disease
 Locomotor system : upper extremity
 •   60% or more impairment of the limb                                                  50
 •   90% impairment of the limb                                                          75

 Locomotor system : lower extremity
 •   60% or more impairment of the limb                                                  25
 •   90% impairment of the limb                                                          50

 Spine
 •   Chronic back and neck pain – per region                                             25
 •   Malignant tumors of the spinal cord and vertebral column                            50
 •   Paraplegia                                                                         100
 •   Quadruplegia                                                                       100

 Visual system
 •   Blindness of one eye                                                                25
 •   Blindness of two eyes                                                              100
 •   Bilateral visual impairment of 50%                                                  25
 Hearing
 •   Permanent binaural hearing loss of 60% or more                                      50
 •   Total and permanent hearing loss in two ears                                       100

 Speech disorder
 •   Total, permanent and irrecoverable loss of the ability to speak                    100

 Psychiatric conditions
 •   Certifiable mental      conditions   which   results   in   permanent
                                                                                        100
     institutionalisation
 Cancer (malignancies)
 •   The cancer must have been optimally treated, and must have reached the stage of maximal medical
     improvement, before functional impairment can be assessed and a claim be considered. Any
     permanent functional impairment will then be rated according to the applicable criteria, as set out
     above.
 Occupational disability
 •   Functional impairment to the extent that the life insured is totally,              100
     permanently and continuously unable to fulfill the occupational            (subject to limitation
     demands of the occupation he or she engaged in for income                    discussed below)
     immediately before the functional impairment. If the life insured is a
     full-time student when he or she becomes functionally impaired, he
     or she must be totally, permanently and continuously unable to fulfill
     the occupational demands of an occupation we may reasonably
     expect him or her to engage in, taking into account his or her
     education, training and experience.




GE 8/2006                                         BZ 61
If the amount Sanlam Life pays for a claim event is less than the full cover amount, Sanlam Life will
reduce the cover amount with the amount paid. Any amount Sanlam Life pays thereafter for a
subsequent claim event, will be based on the reduced cover amount. If, however, the subsequent claim
event and the preceding claim event are based on the same cause, and the percentage of the cover
amount linked to the subsequent claim event is higher than the percentage linked to the preceding claim
event, Sanlam Life will calculate the amount for payment of the subsequent claim event on the cover
amount before it was reduced. From the amount so calculated, Sanlam Life will deduct the amount paid
for the preceding claim, and pay the balance.

Please note that whenever a benefit is admitted for occupational disability, a benefit for any of the other
claim events will not also be admitted at the same time.

LIMITATION OF OCCUPATIONAL DISABILITY CLAIM

If Sanlam Life admits a claim for occupational disability during any of the 4 policy years before the policy
anniversary before or on the life insured's 65th birthday, Sanlam Life will pay only a percentage of the
cover amount as set out below. The remaining part of the cover amount will then still be available for any
of the other claim events.

      Policy year that starts on the policy
       anniversary before or on the life                    % of the cover amount
                  insured's…
                     61st birthday                                       80
                     62th birthday                                       60
                     63rd birthday                                       40
                     64th birthday                                       20

The benefit can also be limited if that is necessary to eliminate over-insurance. For this purpose, Sanlam
Life will follow the guidelines in the Code of good practice for disability insurance of the Life Offices'
Association of South Africa, applicable on the date a disability claim is admitted, or a code or guidelines
that replace it. This Code asks of all insurers to take care that over-insurance does not occur, and to
reduce disability benefits on a proportional basis to the extent that this is reasonably necessary.

When Sanlam Life receives a claim, Sanlam Life will ask for full information of all insurance benefits the
poilicyholder has received or will receive because of the functional impairment in question.




GE 8/2006                                         BZ 62
  EXPLANATIONS

NEW YORK HEART ASSOCIATION (NYHA) FUNCTIONAL CLASSIFICATION OF
CARDIAC DISEASE

A specialist physician or cardiologist must do the classification during a clinical examination according to
the following criteria:

     Class                                               Description
                 •   Individual has cardiac disease, not resulting in limitation of physical activity.
        I        •   Ordinary physical activity does not cause undue fatigue, palpitation, shortness of
                     breath or anginal pain.
                 •   Individual has cardiac disease, resulting in slight limitation of physical activity.
                 •   Is comfortable at rest and in the performance of ordinary, light, daily activities.
       II
                 •   Greater than ordinary physical activity, such as heavy physical exertion, results in
                     fatigue, palpitations, shortness of breath or anginal pain.
                 •   Individual has cardiac disease, resulting in marked limitation of physical activity.
                 •   Is comfortable at rest.
       III
                 •   Ordinary physical activity results in fatigue, palpitations, shortness of breath or anginal
                     pain.
                 •   Individual has cardiac disease, resulting in inability to carry on any physical activity
                     without discomfort.
       IV        •   Symptoms of inadequate cardiac output, pulmonary congestion, systemic congestion,
                     or anginal syndrome may be present, even at rest.
                 •   If physical activity is undertaken, discomfort is increased.

SEVERITY OF VALVE STENOSIS ACCORDING TO VALVE GRADIENT OR VALVE AREA

A specialist physician or cardiologist must do the classification with an echocardiogram.

                                           Mean valve gradient
      Severity of stenosis                                                         Valve area ± (cm2)
                                                (mm/Hg)
 Aortic valve
 •    Mild                                           < 25                                   > 1.5
 •    Moderate                                     25 – 50                                1.0 – 1.5
 •    Severe                                         > 50                                   < 1.0
 Mitral valve
 •    Mild                                            <5                                    > 1.5
 •    Moderate                                      5 - 10                                1.0 – 1.5
 •    Severe                                         > 10                                   < 1.0

HYPERTENSION IN ADULTS

A specialist physician must do the classification according to the following average blood pressure
recordings:

     Blood pressure                                    Hypertension categories
        recording                    Stage I                     Stage II                     Stage III
 Systolic                           140 – 159                   160 – 179                       > 180
 Diastolic                           90 – 99                    100 – 109                       > 110




GE 8/2006                                           BZ 63
PERIPHERAL ARTERIAL AND VENOUS DISEASE

For peripheral arterial and venous disease, only one claim will be allowed, irrespective of whether one or
two legs are affected. No subsequent claims are allowed for the same condition if it re-occurs, or
manifests in another limb, or if the disease progresses to the stage of amputation.

RESPIRATORY SYSTEM

Impaired exercise tolerance must be caused by proven respiratory disease, and be accompanied by
either impaired airflow or impaired diffusion.

For impairment due to a respiratory disease, parameters must be measured after reasonable and
adequate therapy, which comprises
•   bronchodilator on demand, and
•   daily high dose inhaled cortico-steroid (more than 100 mg beclomethasone or equivalent), and
•   daily, or every other day, systemic cortico-steroid.

Lung function testing must be done only once the disease has stabilised, became chronic and is
permanent. At least three abnormal lung function tests, taken at least one month apart, must be
submitted. The average of the values submitted will be used in the assessment of the validity of the
claim.

To optimise patient co-operation and ensure reliable and consistent results, all lung function
measurements must
•   be done by a registered pulmonologist,
•   be done on a calibrated apparatus, and
•   include at least three flow volume curves with less than 5% inter-test variability.

To evaluate permanent impairment due to asthma, lung function testing must be done between acute
attacks, and not during an attack. Post-bronchodilator reversibility must also be measured.

COMA

Irreversible permanent condition of unconsciousness, presenting with a Glascow Coma Scale of 8 or
less, and requiring total medical support.

HEMIPLEGIA

The affected limbs must be permanently paralised.

EPILEPSY

Documented epileptic attacks confirmed by an abnormal electro-encephalogram (EEG) reading. Attacks
must be observed to be more than 3 per week, and be resistant to optimal therapy as confirmed by drug
serum-level testing.

CLINICAL DEMENTIA

All of the following criteria must be met:

•   severe memory loss, with only fragments remaining
•   oriented to person only
•   unable to make judgements to solve problems
•   no independent function outside home
•   too ill to be taken to functions outside home
•   no significant functioning in home
•   requires frequent help with self-care
•   frequent incontinence.




GE 8/2006                                           BZ 64
WHOLE PERSON IMPAIRMENT (WPI)

Any organ, system or limb may have impaired function after a bodily injury or illness. These impairments
can be rated as percentages of impaired function according to the American Medical Association's
Guides to the Evaluation of Permanent Impairment. Whole person impairment reflects the combined
impact of the impairments on the individual's overall ability as a person to perform activities of daily living.

CHRONIC BACK AND NECK PAIN

The neck and back are part of the spine. Only one claim for spinal pain will be allowed per spinal region.
The spinal regions are
•   the cervical region (C1 to C7),
•   the thoracic region (T1 to T12), and
•   the lumbosacral region (L1 to S1).

The C7 to T1 joint will be classified in the cervical region, and the T12 to L1 joint in the lumbosacral
region.

One of the following four diagnoses must be made as the cause of chronic pain:
•   50% compression of a vertebral body
•   clinically significant radiculopathy, verified by an imaging study that confirms a herniated disc at the
    level and side as found clinically, and verified by electrodiagnostic testing
•   alteration of motion segment integrity (instability), using flexion and extension radiographs
•   a back or cervical operation comprising laminectomy, discectomy or fusion, or a combination thereof.

In all four of the above diagnoses the clinical findings, pain distribution and findings on special
examinations, must make pathophysiological sense.

The chronic pain will be evaluated by the following criteria:
•   pain questionnaire
•   pain diagram
•   analgesic medication usage.

MALIGNANT TUMORS OF THE SPINAL CORD AND VERTEBRAL COLUMN

The incontrovertible presence of uncontrolled growth and spread of malignant cells, the invasion of
normal tissue, and the definite histological evidence of malignant growth in the spinal cord and vertebral
column.

PARAPLEGIA

Total, permanent and irrecoverable loss of function of both lower extremities, with or without loss of bowel
or bladder function.

QUADRUPLEGIA

Total, permanent and irrecoverable loss of function of all four limbs.

BLINDNESS

Total, permanent and irrecoverable loss of the vision of an eye as a result of illness or injury, or the
certification of the life insured as legally blind by a registered ophthalmic surgeon.

BACK CONDITION

A disease, disorder, or dysfunction of the vertebrae, spinal cord, intervertebral discs, nerve roots and
supporting muscles or ligaments, as well as the direct or indirect consequences of, or the side-effects of
any treatment applied for, such disease, disorder, or dysfunction.




GE 8/2006                                           BZ 65
FAILED BACK SYNDROME AFTER MULTIPLE SPINAL SURGERY

When the life insured, after the cover for the benefit has began, must undergo more than one spinal
operation on two or more intervertebral disc spaces in the lumbar or cervical area, and despite those
operations, still suffers severe back pain as verified by a multidisciplinary pain clinic. Such operations
may include discectomy, vertebral fusion and internal fixation.

AVERAGE MONTHLY INCOME

The gross taxable monthly income from the life insured's regular occupation, after deducting any tax-
deductible expenses permitted under the income tax legislation applicable at the time, averaged over the
12 months before the claim event took place. If the life insured has a fluctuating income, Sanlam Life will
calculate the average monthly income over the 36 months before the claim event took place.




GE 8/2006                                         BZ 66
                FUNCTIONAL IMPAIRMENT PLUS DISABILITY FOR REGULAR AND
                    REASONABLE ALTERNATIVE OCCUPATION (CAS, CSS)


DESCRIPTION

Sanlam Life will pay the percentage of the cover amount linked to the particular claim event as set out
below.

TYPE OF BENEFIT

This benefit may be selected as an accelerator (CAS) or stand-alone benefit (CSS).

GUARANTEE PERIODS

The client selects the initial guarantee period when taking out the policy. The following minimum and
maximum guarantee periods apply for both Matrix TopCover (except for 7% and 11% per year
compulsory premium growth with whole-life guarantee) and Matrix TermCover:

    •       Minimum   : 5 year
    •       Maximum   : 15 year

For Matrix TopCover with compulsory premium growth at 7% or 11% per year a lifelong premium
guarantee applies. For the full term of the contract Sanlam Life will not increase the premium payable,
except for the contractual growth.

PREMIUM AND COVER GROWTH

Premium and cover growth is available according to the choice of growth selected by the policyholder.

INCEPTION AGES

        •   Minimum      :   When fixed compulsory premium growth is chosen, the minimum inception age
                             is 30 next birthday. Otherwise a minimum of 15 next birthday applies.
        •   Maximum      :   60 age next birthday

BENEFIT CEASE AGE

65 next birthday

BENEFIT CEASE EVENTS

This benefit will end:

•   at midnight before the cover end date as set out in the policy overview, or
•   if the policy ends for any reason before the cover end date, or
•   when the full cover amount has been paid.

QUALIFYING LIVES

Persons who qualify for rate groups 1, 2, 3, 4 and 5 can apply for functional impairment plus disability
benefits.

Lives are also divided into 5 disability classes (A, B, C, D and E) (see Classes). Persons classified in
classes A, B, C, D and E, qualify for functional impairment plus disability for regular and reasonable
alternative occupation.

Housewives, scholars, students and unemployed persons do not qualify for functional impairment plus
disability for regular and reasonable alternative occupation.




GE 8/2006                                          BZ 67
RATE DIFFERENTIATION

Rate differentiation for the calculation of premiums takes place on account of:
    •   Disability class (Occupation)
    •   Smoking habits
    •   Sex

LIMITS

Minimum        : R50 000 per life insured
Maximum        : R10 000 000 per life insured

The sum total of all the following benefits is taken into account when the permissible maximum amount
for functional impairment plus disability benefits is determined:

•   functional impairment plus disability benefits (with Sanlam Life and all other insurers);
•   physical impairment (with Sanlam Life);
•   functional impairment (with Sanlam Life); and
•   disability benefits (lump sums, income benefits and premium waiver)(with Sanlam Life and all other
    insurers).

Sanlam also restricts the available benefit amounts according to income, as follows:

                  Age next birthday                  Multiple of monthly taxable
                 (males and females)                           income
            Up to and including 30 anb            225 x average monthly income
            31 anb up to and including 35 anb     210 x average monthly income
            36 anb up to and including 40 anb     160 x average monthly income
            41 anb up to and including 45 anb     135 x average monthly income
            46 anb up to and including 50 anb     120 x average monthly income
            51 anb up to and including 55 anb       75 x average monthly income
            56 anb and older                      37,5 x average monthly income

The total disability benefit amount, payable from all sources, may not exceed the above limit. Income
Protector benefits (excluding temporary income protector) and waiver of premium benefits at disability are
also taken into account to determine the above limit. The monthly payment is multiplied by 120 to convert
it to a comparable lump sum amount.

Average monthly income is the gross monthly remuneration from employment, averaged over the 12
months before the claim, and reduced by any income replacement disability benefits. If the life insured
has a fluctuating income, the average monthly income will be calculated over 36 months.

ADMITTANCE OF A CLAIM

Besides the general conditions for admittance of a claim as set out earlier in this chapter, Sanlam Life will
admit a claim only if

•   the functional impairment is caused directly and solely by a bodily injury or by an illness;
•   the functional impairment is permanent, after the life insured has undergone optimal, reasonable
    treatment;
•   Sanlam Life has not previously admitted a claim for the same claim event;
•   the life insured survived the diagnosis of the claim event, or the incident causing the claim event,
    −   by more than 30 days without life support, or
    −   in cases where life support was used, by more than 30 days after he or she has been taken off life
        support.

If Sanlam Life has admitted a claim, Sanlam Life will reduce the cover amount of the benefit for the life
insured by the claim amount.




GE 8/2006                                          BZ 68
EXCLUSIONS

Sanlam Life will not admit a claim if the functional impairment of the life insured can be substantially
removed or improved by surgery or other medical treatment, which Sanlam Life can reasonably expect
him or her to undergo, taking into account the risks involved and the chances of success of such surgery
or treatment.

If the life insured at any time engages in sport as an occupation, or works as a pilot, and becomes
continuously unable to fulfill the occupational demands of that occupation, Sanlam Life will not admit a
claim as a result of such inability.

Other general exclusions are set out in the general policy provisions. See the section regarding general
exclusions, which is also applicable to these benefits.

Exclusions for specific conditions

Sanlam Life will not admit a claim for occupational disability if the functional impairment directly or
indirectly resulted from any of the following:

•   depression or dysthymia, whether as an episode or disorder, or as part of the symptom complex of
    another psychiatric diagnosis;
•   post-traumatic stress disorder;
•   fibromyalgia;
•   chronic fatigue syndrome and its synonyms;
•   a back condition, unless it qualifies as one of the following:
    −   paraplegia
    −   quadruplegia
    −   malignant tumors of the spinal cord and vertebral column
    −   failed back syndrome after multiple spinal surgery, provided the extent of the functional
        impairment arising therefrom is verified by a specialist that Sanlam Life will nominate;
•   an injury or illness that directly or indirectly resulted from, or is traceable to, any of the above causes;
•   a complication that directly or indirectly is attributable to any of the above causes, or to such an injury
    or illness;
•   a side effect of treatment for any of the above causes, or for such an injury or illness, or for such a
    complication.




GE 8/2006                                           BZ 69
CLAIM EVENT

The functional impairment must be permanent, and evaluated according to principles and ratings of the
latest edition of the American Medical Association's Guides to the Evaluation of Permanent Impairment.
The functional impairment, and whether it is permanent, will be evaluated only after the life insured has
undergone optimal, reasonable treatment, based on generally accepted medical protocols for treatment
of the condition in question at the time of the claim. Treatment already undergone, as well as treatment
still to be undergone, will be taken into account.


                             Claim event                                    % of the cover amount

 Valvular heart disease, cardiomyopathy
 •   New York Heart Association (NYHA) class III on optimal
     treatment, and
                                                                                        50
     − maximal effort test of 4 to 6 metabolic equivalents (METS), or
     − valve gradient and/or valve area classified as severe
 •   NYHA class IV on optimal treatment, and
     − maximal effort test of less than 4 METS, or                                     100
     − valve gradient and/or valve area classified as severe
 Ischaemic heart disease
 •   NYHA Class III on optimal treatment, and
 •   maximal effort test of 4 to 6 METS, and
     − left ventricular ejection fraction (LVEF) of less than 45%, or
     − moderate diastolic dysfunction as determined by a cardiologist,
                                                                                        50
       taking into account the
       − cause of the dysfunction,
       − extent of ventricular hypertrophy, and
       − mitral inflow pattern as determined by echocardiography
 •   NYHA Class IV on optimal treatment, and
 •   maximal effort test of less than 4 METS, and
     − LVEF of less than 40%, or
     − severe diastolic dysfunction as determined by a cardiologist,
                                                                                       100
       taking into account the
       − cause of the dysfunction,
       − extent of ventricular hypertrophy, and
       − mitral inflow pattern as determined by echocardiography
 Arrhythmia
 •   Arrhythmia on optimal treatment that results in
     − NYHA Class III shortness of breath, and
     − 4 or less METS with maximal effort test; or                                      50
 •   documented arrhythmia that fails to respond to optimal treatment,
     and leads to frequent fainting spells
 •   Arrhythmia on optimal treatment that results in
     − NYHA Class IV shortness of breath, and                                          100
     − 2 or less METS with maximal effort test




GE 8/2006                                         BZ 70
                                Claim event                                       % of the cover amount

 Hypertension
 •   Stage II hypertension despite optimal treatment, and
                                                                                           50
 •   creatinine clearance of less than 50% of normal
 •   Stage III hypertension despite optimal treatment, and
                                                                                          100
 •   creatinine clearance of less than 20% of normal
 Peripheral arterial disease
 •   Abnormal Doppler readings, cold leg, rubor and pain on exercise                       50
 •   No palpable pulses, confirmed by absent Doppler readings, or
 •   severe vascular ulceration, or                                                       100
 •   gangrene
 Peripheral venous disease
 •   Severe deep and widespread vascular ulceration                                        50

 Haematopoitic system
 •   Symptoms due to anaemia with the need for two to three units of
                                                                                          100
     blood every two weeks on a permanent basis
 Respiratory system
 •   Impaired airflow with
     − forced expiratory volume in one second (FEV1) of less than 50%,
                                                                                           50
        or
     − forced vital capacity (FVC) of less than 50%
 •   Impaired airflow with
     − FEV1 of less than 40%, or                                                          100
     − FVC of less than 40%
 •   Impaired diffusion with diffusion capacity (DCO) of less than 50%                     50
 •   Impaired diffusion with DCO of less than 40%                                         100
 •   Impaired exercise tolerance with maximal effort test of 4 to 6 METS                   50
 •   Impaired exercise tolerance with maximal effort test of less than
                                                                                          100
     4 METS
 Central nervous system
 •   Coma                                                                                 100
 •   Hemiplegia                                                                           100
 •   Epilepsy                                                                              50
 •   Clinical dementia rating in severe category                                           50
 •   Cranial nerve VII paralysis with severe unilateral upper motor neuron
     facial paralysis, involving more than 75% of the face muscles, and                    50
     inability to control eyelid closure
 •   Cranial nerve VIII paralysis or imbalance with moderately severe
     equilibrium impairment, with limitations of all activities of daily living            50
     (ADL), and requiring permanent assistance with self-care




GE 8/2006                                          BZ 71
                                 Claim event                                       % of the cover amount
 Central nervous system (continued)
 •   Cranial nerve VIII paralysis or imbalance with moderately severe
     equilibrium impairment, with limitations of all ADL, requiring                         75
     permanent assistance with self-care, plus permanent confinement
 •   Cranial nerves IX, X or XII paralysis or dysarthria or dysphagia, with
     moderately severe dysarthria or dysphagia with hoarseness, nasal                       25
     regurgitation and aspiration of fluids
 •   Cranial nerves IX, X or XII paralysis or dysarthria or dysphagia, with
     severe inability to swallow without choking, with need for assistance                  75
     and suctioning
 •   Neurologic impairment of respiration where the life insured is capable
     of spontaneous respiration, but is restricted to sitting, standing or                  50
     limited ambulation
 •   Neurologic impairment of respiration where the life insured is capable
     of spontaneous respiration, but to such a limited degree that he or she                75
     is permanently confined to bed
 •   Neurologic impairment of respiration where the life insured has no
                                                                                            100
     capacity for spontaneous respiration
 •   Neurologic impairment of the bladder where the life insured has no
     reflex or voluntary control of the bladder due to permanent neurologic                 25
     impairment
 •   Neurologic anorectal impairment where the life insured has no reflex
     regulation or voluntary control of the anus or rectum due to permanent                 25
     neurologic impairment
 Gastro-intestinal system : upper and lower digestive tract
 •   Anatomic loss or alteration in gastro-intestinal tract with
     − medical evidence of organic disease, and
     − symptoms uncontrolled by adequate treatment, and                                     100
     − 25% weight loss below accepted desirable weight; or
 •   complete faecal incontinence
 •   Anatomic loss or alteration in gastro-intestinal tract with
     −  medical evidence of organic disease, and
     −  symptoms uncontrolled by adequate treatment, and
     −  15% weight loss below accepted desirable weight for a period                        50
        exceeding a year, despite optimal treatment; or
 •   permanent stoma; or
 •   persistent, irreducible and irreparable protrusion of a hernia after
     surgery with bowel dysfunction and limitation in activities of daily living
 Gastro-intestinal system : liver
 •   Progressive chronic liver disease, and
 •   objective evidence of jaundice, and
                                                                                            100
 •   ascites or bleeding oesophageal varices within the last year, and
 •   25% weight loss below accepted desirable weight
 Gastro-intestinal system : biliary tract
 •   Irreparable biliary tract obstruction with persistent jaundice                         100




GE 8/2006                                           BZ 72
                                 Claim event                                   % of the cover amount

 Endocrine system
 •   Disorders of the hypothalamic pituitary axis, with permanent whole
                                                                                          50
     person impairment (WPI) exceeding 26%
 •   Hypoadrenalism, with permanent WPI exceeding 30%                                     50
 •   Hyperadrenocorticism, with permanent WPI exceeding 40%                               50
 •   Phaeochromocytoma, with permanent WPI exceeding 30%                                  50

 Urinary tract
 •   Reduction in urinary tract function, with creatinine clearance of 28 to
     42 ml per minute, or                                                                 50
 •   bladder or urethral disease resulting in complete urinary incontinence
 •   Urinary tract functional impairment
     −   with creatinine clearance of less than 28 ml per minute, or                     100
     −   constant dialysis
 Diabetes mellitus : type I or II with target organ complications
 •   Kidney functions impaired                                                     See urinary tract
 •   Retinopathy with visual impairment                                           See visual system
                                                                                 See ischaemic heart
 •   Ischaemic heart disease
                                                                                       disease
 Locomotor system : upper extremity
 •   60% or more impairment of the limb                                                   50
 •   90% impairment of the limb                                                           75

 Locomotor system : lower extremity
 •   60% or more impairment of the limb                                                   25
 •   90% impairment of the limb                                                           50

 Spine
 •   Chronic back and neck pain – per region                                              25
 •   Malignant tumors of the spinal cord and vertebral column                             50
 •   Paraplegia                                                                          100
 •   Quadruplegia                                                                        100

 Visual system
 •   Blindness of one eye                                                                 25
 •   Blindness of two eyes                                                               100
 •   Bilateral visual impairment of 50%                                                   25

 Hearing
 •   Permanent binaural hearing loss of 60% or more                                       50
 •   Total and permanent hearing loss in two ears                                        100

 Speech disorder
 •   Total, permanent and irrecoverable loss of the ability to speak                     100

 Psychiatric conditions
 •   Certifiable mental conditions which results in permanent
                                                                                         100
     institutionalisation



GE 8/2006                                         BZ 73
                               Claim event                                      % of the cover amount

 Cancer (malignancies)
 •   The cancer must have been optimally treated, and must have reached the stage of maximal medical
     improvement, before functional impairment can be assessed and a claim be considered. Any
     permanent functional impairment will then be rated according to the applicable criteria, as set out
     above.
 Occupational disability
 •   Functional impairment to the extent that the life insured is totally,                 100
     permanently and continuously unable to fulfill the occupational
                                                                                   (subject to limitation
     demands of the occupation he or she engaged in for income
                                                                                     discussed below)
     immediately before the functional impairment as well as an
     occupation we may reasionably expect him or her to engage in, taking
     into account his or her education, training and experience. If the life
     insured is a full-time student when he or she becomes functionally
     impaired, he or she must be totally, permanently and continuously
     unable to fulfill the occupational demands of an occupation we may
     reasonably expect him or her to engage in, taking into account his or
     her education, training and experience.

If the amount Sanlam Life pays for a claim event is less than the full cover amount, Sanlam Life will
reduce the cover amount with the amount paid. Any amount Sanlam Life pays thereafter for a
subsequent claim event, will be based on the reduced cover amount. If, however, the subsequent claim
event and the preceding claim event are based on the same cause, and the percentage of the cover
amount linked to the subsequent claim event is higher than the percentage linked to the preceding claim
event, Sanlam Life will calculate the amount for payment of the subsequent claim event on the cover
amount before it was reduced. From the amount so calculated, Sanlam Life will deduct the amount paid
for the preceding claim, and pay the balance.

Please note that whenever a benefit is admitted for occupational disability, a benefit for any of the other
claim events will not also be admitted at the same time.

LIMITATION OF OCCUPATIONAL DISABILITY CLAIM

If Sanlam Life admits a claim for occupational disability during any of the 4 policy years before the policy
anniversary before or on the life insured's 65th birthday, Sanlam Life will pay only a percentage of the
cover amount as set out below. The remaining part of the cover amount will then still be available for any
of the other claim events.

      Policy year that starts on the policy
       anniversary before or on the life                    % of the cover amount
                  insured's…
                     61st birthday                                       80
                     62nd birthday                                       60
                     63rd birthday                                       40
                     64th birthday                                       20

The benefit can also be limited if that is necessary to eliminate over-insurance. For this purpose, Sanlam
Life will follow the guidelines in the Code of good practice for disability insurance of the Life Offices'
Association of South Africa, applicable on the date a disability claim is admitted, or a code or guidelines
that replace it. This Code asks of all insurers to take care that over-insurance does not occur, and to
reduce disability benefits on a proportional basis to the extent that this is reasonably necessary.

When Sanlam Life receives a claim, Sanlam Life will ask for full information of all insurance benefits the
poilicyholder has received or will receive because of the functional impairment in question.




GE 8/2006                                         BZ 74
  EXPLANATIONS

NEW YORK HEART ASSOCIATION (NYHA) FUNCTIONAL CLASSIFICATION OF
CARDIAC DISEASE

A specialist physician or cardiologist must do the classification during a clinical examination according to
the following criteria:

     Class                                               Description
                 •   Individual has cardiac disease, not resulting in limitation of physical activity.
        I        •   Ordinary physical activity does not cause undue fatigue, palpitation, shortness of
                     breath or anginal pain.
                 •   Individual has cardiac disease, resulting in slight limitation of physical activity.
                 •   Is comfortable at rest and in the performance of ordinary, light, daily activities.
       II
                 •   Greater than ordinary physical activity, such as heavy physical exertion, results in
                     fatigue, palpitations, shortness of breath or anginal pain.
                 •   Individual has cardiac disease, resulting in marked limitation of physical activity.
                 •   Is comfortable at rest.
       III
                 •   Ordinary physical activity results in fatigue, palpitations, shortness of breath or anginal
                     pain.
                 •   Individual has cardiac disease, resulting in inability to carry on any physical activity
                     without discomfort.
       IV        •   Symptoms of inadequate cardiac output, pulmonary congestion, systemic congestion,
                     or anginal syndrome may be present, even at rest.
                 •   If physical activity is undertaken, discomfort is increased.

SEVERITY OF VALVE STENOSIS ACCORDING TO VALVE GRADIENT OR VALVE AREA

A specialist physician or cardiologist must do the classification with an echocardiogram.

                                           Mean valve gradient
      Severity of stenosis                                                         Valve area ± (cm2)
                                                (mm/Hg)
 Aortic valve
 •    Mild                                           < 25                                   > 1.5
 •    Moderate                                     25 – 50                                1.0 – 1.5
 •    Severe                                         > 50                                   < 1.0
 Mitral valve
 •    Mild                                            <5                                    > 1.5
 •    Moderate                                      5 - 10                                1.0 – 1.5
 •    Severe                                         > 10                                   < 1.0

HYPERTENSION IN ADULTS

A specialist physician must do the classification according to the following average blood pressure
recordings:


     Blood pressure                                    Hypertension categories
        recording                    Stage I                     Stage II                     Stage III
 Systolic                           140 – 159                   160 – 179                       > 180
 Diastolic                           90 – 99                    100 – 109                       > 110




GE 8/2006                                           BZ 75
PERIPHERAL ARTERIAL AND VENOUS DISEASE

For peripheral arterial and venous disease, only one claim will be allowed, irrespective of whether one or
two legs are affected. No subsequent claims are allowed for the same condition if it re-occurs, or
manifests in another limb, or if the disease progresses to the stage of amputation.

RESPIRATORY SYSTEM

Impaired exercise tolerance must be caused by proven respiratory disease, and be accompanied by
either impaired airflow or impaired diffusion.

For impairment due to a respiratory disease, parameters must be measured after reasonable and
adequate therapy, which comprises
•   bronchodilator on demand, and
•   daily high dose inhaled cortico-steroid (more than 100 mg beclomethasone or equivalent), and
•   daily, or every other day, systemic cortico-steroid.

Lung function testing must be done only once the disease has stabilised, became chronic and is
permanent. At least three abnormal lung function tests, taken at least one month apart, must be
submitted. The average of the values submitted will be used in the assessment of the validity of the
claim.

To optimise patient co-operation and ensure reliable and consistent results, all lung function
measurements must
•   be done by a registered pulmonologist,
•   be done on a calibrated apparatus, and
•   include at least three flow volume curves with less than 5% inter-test variability.

To evaluate permanent impairment due to asthma, lung function testing must be done between acute
attacks, and not during an attack. Post-bronchodilator reversibility must also be measured.

COMA

Irreversible permanent condition of unconsciousness, presenting with a Glascow Coma Scale of 8 or
less, and requiring total medical support.

HEMIPLEGIA

The affected limbs must be permanently paralised.

EPILEPSY

Documented epileptic attacks confirmed by an abnormal electro-encephalogram (EEG) reading. Attacks
must be observed to be more than 3 per week, and be resistant to optimal therapy as confirmed by drug
serum-level testing.

CLINICAL DEMENTIA

All of the following criteria must be met:

•   severe memory loss, with only fragments remaining
•   oriented to person only
•   unable to make judgements to solve problems
•   no independent function outside home
•   too ill to be taken to functions outside home
•   no significant functioning in home
•   requires frequent help with self-care
•   frequent incontinence.




GE 8/2006                                           BZ 76
WHOLE PERSON IMPAIRMENT (WPI)

Any organ, system or limb may have impaired function after a bodily injury or illness. These impairments
can be rated as percentages of impaired function according to the American Medical Association's
Guides to the Evaluation of Permanent Impairment. Whole person impairment reflects the combined
impact of the impairments on the individual's overall ability as a person to perform activities of daily living.

CHRONIC BACK AND NECK PAIN

The neck and back are part of the spine. Only one claim for spinal pain will be allowed per spinal region.
The spinal regions are
•   the cervical region (C1 to C7),
•   the thoracic region (T1 to T12), and
•   the lumbosacral region (L1 to S1).

The C7 to T1 joint will be classified in the cervical region, and the T12 to L1 joint in the lumbosacral
region.

One of the following four diagnoses must be made as the cause of chronic pain:
•   50% compression of a vertebral body;
•   clinically significant radiculopathy, verified by an imaging study that confirms a herniated disc at the
    level and side as found clinically, and verified by electrodiagnostic testing;
•   alteration of motion segment integrity (instability), using flexion and extension radiographs;
•   a back or cervical operation comprising laminectomy, discectomy or fusion, or a combination thereof.

In all four of the above diagnoses the clinical findings, pain distribution and findings on special
examinations, must make pathophysiological sense.

The chronic pain will be evaluated by the following criteria:
•   pain questionnaire;
•   pain diagram;
•   analgesic medication usage.

MALIGNANT TUMORS OF THE SPINAL CORD AND VERTEBRAL COLUMN

The incontrovertible presence of uncontrolled growth and spread of malignant cells, the invasion of
normal tissue, and the definite histological evidence of malignant growth in the spinal cord and vertebral
column.

PARAPLEGIA

Total, permanent and irrecoverable loss of function of both lower extremities, with or without loss of bowel
or bladder function.

QUADRUPLEGIA

Total, permanent and irrecoverable loss of function of all four limbs.

BLINDNESS

Total, permanent and irrecoverable loss of the vision of an eye as a result of illness or injury, or the
certification of the life insured as legally blind by a registered ophthalmic surgeon.

BACK CONDITION

A disease, disorder, or dysfunction of the vertebrae, spinal cord, intervertebral discs, nerve roots and
supporting muscles or ligaments, as well as the direct or indirect consequences of, or the side-effects of
any treatment applied for, such disease, disorder, or dysfunction.




GE 8/2006                                           BZ 77
FAILED BACK SYNDROME AFTER MULTIPLE SPINAL SURGERY

When the life insured, after the cover for the benefit has began, must undergo more than one spinal
operation on two or more intervertebral disc spaces in the lumbar or cervical area, and despite those
operations, still suffers severe back pain as verified by a multidisciplinary pain clinic. Such operations
may include discectomy, vertebral fusion and internal fixation.

AVERAGE MONTHLY INCOME

The gross taxable monthly income from the life insured's regular occupation, after deducting any tax-
deductible expenses permitted under the income tax legislation applicable at the time, averaged over the
12 months before the claim event took place. If the life insured has a fluctuating income, Sanlam Life will
calculate the average monthly income over the 36 months before the claim event took place.




GE 8/2006                                         BZ 78
                                    CORE DREAD DISEASE (TAC, TSC)


DESCRIPTION

Sanlam Life will pay the percentage of the cover amount linked to the particular claim event as set out
below.

TYPE OF BENEFIT

This benefit may be selected as an accelerator (TAC) or stand-alone benefit (TSC).

GUARANTEE PERIODS

The client selects the guarantee period when taking out the policy. The following minimum and maximum
guarantee periods apply for both Matrix TopCover (except for 7% and 11% per year compulsory premium
growth with whole-life guarantee) and Matrix TermCover:
    •   Minimum : 5 years
    •   Maximum : 15 years

For Matrix TopCover with compulsory premium growth at 7% or 11% per year a lifelong premium
guarantee applies. For the full term of the contract Sanlam Life will not increase the premium payable,
except for the contractual growth.

PREMIUM AND COVER GROWTH

Premium and cover growth is available according to the choice of growth selected by the policyholder.

INCEPTION AGES
    •   Minimum          :   When fixed compulsory premium growth is chosen, the minimum inception age is
                             30 next birthday. Otherwise a minimum of 15 next birthday applies.
    •   Maximum          :   60 age next birthday

BENEFIT CEASE AGE

65 next birthday

BENEFIT CEASE EVENTS

This benefit will end:
•   at midnight before the cover end date as set out in the policy overview, or
•   if the policy ends for any reason before the cover end date, or
•   when the full cover amount has been paid (in the case of accelerator benefit), or
•   when the full cover amount has been paid for claims involving each organ or related group of organs
    (in the case of stand-alone benefit).

QUALIFYING LIVES

Persons who qualify for rate groups 1, 2, 3, 4 and 5 can apply for core dread disease benefits.

RATE DIFFERENTIATION

Rate differentiation for the calculation of premiums takes place according to:
    •   Rate group
    •   Smoking habits
    •   Sex




GE 8/2006                                           BZ 79
LIMITS

Minimum              : R50 000 per life insured
Maximum              : R2 500 000 per life insured

All dread disease and trauma benefits already provided by Sanlam Life, and all other insurers, on the life
of the insured, will be taken into account to determine the maximum amount of dread disease benefits
allowed.

Housewives, scholars, students and pensioners only qualify for a limited amount of dread disease
benefits, namely:
          •   Housewives         :     Greater of R350 000 and 3 x income of spouse, but with a total
                                       maximum of R1,5 million
          •   Scholars           :     R300 000
          •   Students           :     R500 000
          •   Pensioners         :     Greater of R350 000 and 3 x income, but with a total maximum of
                                       R1,5 million

ADMITTANCE OF A CLAIM

Besides the general conditions for admittance of a claim as set out earlier in this chapter, Sanlam Life will
admit a claim only if

•     the life insured survived the diagnosis of the claim event, or the incident causing the claim event,
      −   by more than 30 days without life support, or
      −   in cases where life support was used, by more than 30 days after he or she has been taken off life
          support;
•     If the benefit is an acceleration benefit and Sanlam Life has not previously admitted a claim for the
      same claim event, except if the claim event is coronary artery bypass graft (CABG).

If Sanlam Life has admitted a claim in the case of an accelerator benefit, Sanlam Life will reduce the
cover amount of the benefit for the life insured by the claim amount.

If Sanlam Life admitted a claim in the case of a stand alone benefit, Sanlam Life will not reduce the cover
amount of the benefit for the life insured by the claim amount, except if the claim has been for accidental
HIV infection. However, Sanlam Life will not allow claims involving any one organ, or related group of
organs, to exceed 100% of the cover amount, except if the causes for the claims are totally unrelated
according to the opinion of our Chief Medical Officer. The table below indicates which organ, or related
group of organs, is involved for each specific claim event.

                         Claim event                                        Organ involved

    Cancer                                                Organ where cancer originated, and organs to
                                                          which it subsequently spreads
    Myocardial infarction                                 Heart, brain and blood vessels
    Stroke                                                Brain and blood vessels
    Coronay artery bypass graft (CABG)                    Heart, brain and blood vessels

CLAIM EVENT

The core dread disease benefit covers cancer, myocardial infarction, stroke and coronary artery bypass
graft. The claim events and percentages payable for the various claim events covered is set out below.




GE 8/2006                                            BZ 80
EXCLUSIONS

Sanlam Life will not admit a claim for

•       cancer if it is
        −     carcinoma in situ, for example, carcinoma in situ of the cervix, or
        −     any skin cancer, except malignant melanomas with Clark level 2 or more depth invasion, or
        −     early prostatic cancer, medically classified as TNM class T1(a) or T1(b) or equivalent, or
        −     kaposi sarcoma;
•       a stroke resulting from external injuries;
•       coronary artery bypass graft if it is only an insertion of a stent.

Other general exclusions are set out in the general policy provisions.

FULL DESCRIPTION OF CLAIM EVENTS

                       Claim event                             % of the cover amount
    Cancer                                                                    100
    Myocardial infarction                                                     100
    Stroke                                                                    100
    Coronary artery bypass graft (CABG)
    •       Up to three coronary arteries                                     50
    •       More than three coronary arteries                                 75


    EXPLANATIONS

CANCER

The incontrovertible presence of uncontrolled growth and spread of malignant cells, the invasion of
normal tissue, and the definite histological evidence of a malignant growth, that requires major surgery, or
chemotherapy, or radiotherapy. Leukemia, lymphomas and Hodgkin’s disease are included for benefits.

MYOCARDIAL INFARCTION

A heart attack diagnosed by
•       typical chest pain, and
•       new diagnostic hyperacute electrocardiographical changes, or development of QS or QR complexes,
        and
•       diagnostic increases in the levels of cardiac markers, excluding elevation of troponin.

STROKE

The irreversible death of brain tissue owing to bleeding on the brain, or a blood clot in the arteries of the
brain. The bleeding or blood clot must arise as a result of a disease process, and must lead to
permanent neurological dysfunction which, in this regard, does not include the loss of cognitive functions
(for example, loss of concentration or memory) and transient ischaemic attacks.

CORONARY ARTERY BYPASS GRAFT (CABG)

An operation, that is a bypass graft, performed by a cardiothoracic surgeon on the coronary arteries of
the heart for critical narrowing of the arteries, which presents clinically as angina.




GE 8/2006                                                BZ 81
                             COMPREHENSIVE DREAD DISEASE (TAW, TSW)



DESCRIPTION

Sanlam Life will pay the percentage of the cover amount linked to the particular claim event as set out
below.

TYPE OF BENEFIT

This benefit may be selected as an accelerator (TAW) or stand-alone benefit (TSW).

GUARANTEE PERIODS

The client selects the guarantee period when taking out the policy. The following minimum and maximum
guarantee periods apply for both Matrix TopCover (except for 7% and 11% per year compulsory premium
growth with whole-life guarantee) and Matrix TermCover:
    •   Minimum : 5 years
    •   Maximum : 15 years

For Matrix TopCover with compulsory premium growth at 7% or 11% per year a lifelong premium
guarantee applies. For the full term of the contract Sanlam Life will not increase the premium payable,
except for the contractual growth.

PREMIUM AND COVER GROWTH

Premium and cover growth is available according to the choice of growth selected by the policyholder.

INCEPTION AGES

    •   Minimum          :   When fixed compulsory premium growth is chosen, the minimum inception age is
                             30 next birthday. Otherwise a minimum of 15 next birthday applies.
    •   Maximum          :   60 age next birthday

BENEFIT CEASE AGE

65 next birthday

BENEFIT CEASE EVENTS

This benefit will end:
•   at midnight before the cover end date as set out in the policy overview, or
•   if the policy ends for any reason before the cover end date, or
•   when the full cover amount has been paid (in the case of accelerator benefit), or
•   when the full cover amount has been paid for claims involving each organ or related group of organs
    (in the case of stand-alone benefit).

QUALIFYING LIVES

Persons who qualify for rate groups 1, 2, 3, 4 and 5 can apply for comprehensive dread disease benefits.

RATE DIFFERENTIATION

Rate differentiation for the calculation of premiums takes place according to:
    •   Rate group
    •   Smoking habits
    •   Sex




GE 8/2006                                           BZ 82
LIMITS

Minimum : R50 000 per life insured
Maximum : R2 500 000 per life insured

All dread disease and trauma benefits already provided by Sanlam Life, and all other insurers, on the life
of the insured, will be taken into account to determine the maximum amount of dread disease benefits
allowed.

Housewives, scholars, students and pensioners only qualify for a limited amount of dread disease
benefits, namely:
        •   Housewives          :    Greater of R350 000 and 3 x income of spouse, but with a total
                                     maximum of R1,5 million
        •   Scholars            :    R300 000
        •   Students            :    R500 000
        •   Pensioners          :    Greater of R350 000 and 3 x income, but with a total maximum of
                                     R1,5 million


ADMITTANCE OF A CLAIM

Besides the general conditions for admittance of a claim as set out earlier in this chapter, Sanlam Life will
admit a claim only if

•   the life insured survived the diagnosis of the claim event, or the incident causing the claim event,
    −   by more than 30 days without life support, or
    −   in cases where life support was used, by more than 30 days after he or she has been taken off life
        support.
•   the benefit is an accelerator benefit and Sanlam Life has not previously admitted a claim for the same
    claim event, except if the claim event is one of the following:
    −   arrhythmia;
    −   angioplasty, which is limited to 2 claims per life insured.

If Sanlam Life admitted a claim in the case of a stand alone benefit, Sanlam Life will not reduce the cover
amount of the benefit for the life insured by the claim amount, except if the claim has been for accidental
HIV infection. However, Sanlam Life will not allow claims involving any one organ, or related group of
organs, to exceed 100% of the cover amount, except if the causes for the claims are totally unrelated
according to the opinion of our Chief Medical Officer.




GE 8/2006                                           BZ 83
The table below indicates which organ, or related group of organs, is involved for each specific claim
event.

                     Claim event                                    Organ involved
     Cancer                                           Organ where cancer originated, and organs to
                                                      which it subsequently spreads
     Myocardial infarction                            Heart, brain and blood vessels
     Heart valve surgery                              Heart, brain and blood vessels
     Aortic artery surgery                            Aorta, brain and blood vessels
     Arrhythmia                                       Heart, brain and blood vessels
     Cardiomyopathy                                   Heart, brain and blood vessels
     Stroke                                           Brain and blood vessels
     Blindness                                        Eyes
     Organ transplant                                 Specific organ that is transplanted
     Renal failure                                    Kidneys
     Liver failure                                    Liver
     End-stage lung disease                           Lungs
     Coronary artery surgery                          Heart, brain and blood vessels
     Sero-positive rheumatoid arthritis               Joints
     Multiple sclerosis                               Brain
     Parkinson's disease                              Brain
     Loss of limb function due to medical causes      Limbs
     Benign brain tumour                              Brain
     Pulmonary embolism                               Lungs
     Hearing loss                                     Ears
     Alzheimer's disease                              Brain
     Motor neurone disease                            Brain and limbs
     Muscular dystrophy                               Limbs
     Aplastic anaemia                                 Bone marrow

CLAIM EVENTS

The comprehensive dread disease benefit covers cancer, myocardial infarction, heart valve surgery,
aortic artery surgery, arrhythmia, cardiomyopathy, stroke, blindness, organ transplant, renal failure, liver
failure, end-stage lung disease, coronary artery surgery, sero-positive rheumatoid arthritis, multiple
sclerosis, Parkinson’s disease, loss of limb function due to medical causes, benign brain tumor,
pulmonary embolism, hearing loss, accidental HIV infection, Alzheimer’s disease, motor neurone disease,
muscular dystrophy and aplastic anaemia. The claim events and percentages payable for the various
claim events covered is set out below.




GE 8/2006                                          BZ 84
EXCLUSIONS

Sanlam Life will not admit a claim for

•       cancer if it is
        −     carcinoma in situ, for example, carcinoma in situ of the cervix, or
        −     any skin cancer, except malignant melanomas with Clark level 2 or more depth invasion, or
        −     early prostatic cancer, medically classified as TNM class T1(a) or T1(b) or equivalent, or
        −     kaposi sarcoma;
•       aortic surgery if it is done on the branches of the aorta
•       a stroke resulting from external injuries;
•       liver failure if cirrhosis is due to alcohol or substance abuse;
•       loss of limb function if the originating cause is a bodily injury;
•       Alzheimer's disease if dementia is induced by other conditions and substances.

Also see section regarding general exclusions, which is also applicable to these benefits.

FULL DESCRIPTION OF CLAIM EVENTS

                               Claim event                             % of the cover amount
    Cancer                                                                      100
    Myocardial infarction                                                       100
    Heart valve surgery                                                         100
    Aortic artery surgery                                                       100
    Arrhythmia                                                                   25
    Cardiomyopathy
    •       A