Standard Insurance Company (The Standard) has just released a new single premium deferred indexed annuity with returns based on the performance of the J.P. Morgan U.S. Sector Rotator 5 Index. According to a Business Wire press release, Strategic Choice Annuity 7 combines the strength of an annuity contract with the ability to receive interest based on increases in an index.
“Strategic Choice Annuity 7 is an excellent option for clients who are interested in the growth potential of the J.P. Morgan U.S. Sector Rotator 5 Index, with the assurance of a Guaranteed Minimum Accumulation Benefit,” said Rich Lane, senior director of individual annuity sales and marketing at The Standard. “This innovative product is structured to provide safety for clients who want to grow their assets for their post-retirement years,” he added.
Typical index annuities credit interest annually, limiting those credits by a cap. The Strategic Choice Annuity 7 is unique because it has no cap and credits interest at the end of seven years. This feature allows The Standard to provide greater upside potential for clients. Additionally, the new product included a Guaranteed Minimum Accumulation Benefit (GMAB), guaranteeing that the annuity value will at least reach a predetermined value of 107% of the original premium after seven years. This feature provides clients with the peace of mind that even in a down market, their annuity fund will have earned at least the guaranteed minimum in interest growth.
Because Strategic Choice Annuity 7 leverages the J.P. Morgan U.S. Sector Rotator 5 Index, the product offers an innovative way to accumulate growth. The index adjusts monthly to include U.S. sector funds that have exhibited the stronger performance.
“The index uses a momentum-based strategy, based on the proposition that assets with recent positive performance are more likely to continue such positive trends in the near future,” Lane stated. “This helps manage risk and reduces the potential for large index declines by allocating weights to selected sector funds.”
An additional feature allows consumers to make withdrawals without a surrender charge after the first year if the owner is diagnosed with a terminal condition. The same liquidity provision is available to those who are confined to a nursing home as well.
Written by Rachel Summit
