Here’s a look at some of the recent happenings in the annuity industry, according to ThinkAdvisor.
There are two new indexed annuities available from Security Benefit Life Insurance Company. Both are part of the new Strategic Growth Series Annuities family and are filed with regulators as non-variable contracts.
The Strategic Growth Annuity contract is aimed at purchasers who are looking for high participation rates and spreads and comes without a bonus, according to Topeka, Kansas based Security Benefit. The Strategic Growth Plus Annuity contract offers a 6% premium bonus.
Purchasers of both contracts will have access to the Morningstar Wide Moat Focus Barclays VC 7% index, in addition to a number of other interest crediting options, like the S&P 500 Low Volatility Daily Risk Control index.
Contracts will also offer free withdrawal of up to 10% of the prior year’s contract anniversary account value, beginning in the second contract year.
In other news:
The Internal Revenue Service recently gave several life insurers permission to allow annuity holders to pay advisory fees out of the annuity contract market value, without creating a taxable event, and Cincinnati-based Great American Life recently announced that they would be taking advantage of it.
Previously, annuity holders who attempted to pay advisors directly from the account value could have been subject to pay a 10% tax penalty.
Great American Life will help annuity holders take advantage of the new ruling by adding an endorsement to the contracts for all fee-based annuity contracts issued on or after October 28, 2019. They will also retroactively apply the endorsement to the company’s older fee-based annuity contracts.
The endorsement states that withdrawals used to pay advisors’ fees are not subject to early-withdrawal charges or market-value adjustment. They also do not reduce the contract’s free-withdrawal amount or income rider benefits.
Furthermore:
Transamerica will now offer annuities through the Insurance Exchange system developed by Fiduciary Exchange LLC, or FIDx, of Berwyn, Pennsylvania. The FIDx Insurance Exchange provides an annuity exchange, aka a web-based annuity supermarket, in addition to support services aimed at assisting clients of financial professionals who are not licensed to sell annuities.
Written by Rachel Summit
