According to a recent news article from ThinkAdvisor, Great-American Life Insurance Company has introduced a new variable indexed annuity that targets clients who like hard assets. The company, which is based in Cincinnati, Ohio, has said that purchasers can get a full prospectus and an index menu that includes a gold index and a real estate index. Additionally, the index menu of Index Frontier 7 variable annuity will include the S&P 500 Index, the iShares U.S. Real Estate ETF, and the SPDR Gold Shares ETF.
Great-American Life says it will use its resources to hold an annuity holder’s losses to just 10% for each term, and each investment option offers a one-year term. In exchange for accepting some exposure to investment losses, annuity holders will have a chance to earn positive returns as high as 20%. Annual administrative fees, mortality and expense fees, or 12b-1 fees are not included with the new product. It does, however, come with a seven-year early-withdrawal-charge period.
Index Frontier 7 will be issued by Great-American Life for use in retirement accounts for people ages 18-80, and for use outside of retirement accounts for individuals ages 0-80. The minimum initial payment is $25,000, with an option to add payments of $10,000 or more during the first two contract months. The contract also includes an extended care waiver rider and a terminal illness waiver rider. These allow the purchaser to withdrawal all of the account assets without penalty after the end of the first contract year. The extended care waiver rider applies to an annuity user who is confined to a long-term care facility, such as a nursing home, for at least 90 consecutive days. The terminal illness rider applies to an annuity user with a prognosis of survival of 12 months or fewer.
Great-American Life is part of American Financial Group Inc., a publicly traded company with a large property-casualty insurance operation.
Written by Rachel Summit