2012 Annuity Product Update – Third Quarter

by on Oct 09, 2012

annuity_product_update_imageSince the most recent installment of our quarterly Annuity Product Update, four new products and a new index strategy have been unveiled by Annuity Monitorfirms. Compared to the third quarter of 2011, this year’s third quarter has seen a noticeable drop in new annuity product releases. Here is a look at the products that were introduced over the last three months by Annuity Monitor firms:

The Hartford – Legacy Lock Benefit Rider
The firm introduced a Legacy Lock benefit rider, available with the Personal Retirement Manager suite of variable annuity products, to its suite of optional benefit rider products. The new product provides clients with income payments that will not reduce the death benefit for beneficiaries when the contract value remains within specified limits.

The Hartford – Daily Lock Income Benefit Rider
The firm unveiled the Daily Lock Income benefit rider, available with the Personal Retirement Manager suite of variable annuity products, back in July of 2012. The new rider offers clients guaranteed lifetime income with daily step-ups based on investment performance and a 6% annual deferral bonus when market step-up results are less than the guaranteed rate of the first 10 contract years.  Clients who elect the Daily Lock rider also qualify to add the previously mentioned Legacy Lock rider.

ING – Performance Trigger Index Strategy
The firm unveiled a new interest credit strategy – Performance Trigger Index Strategy – that is available for fixed index annuity products. The new strategy bases interest credits on a predetermined rate, called the trigger rate, if the S&P; 500 index value at the end of the contract year is greater than or equal to the value at the beginning of the contract year.

MassMutual – RetireEase Choice
The firm introduced a new product, RetireEase Choice, to its suite of income annuities. The new product is designed to offer a guaranteed income stream for life. Key product features include flexible purchase payments, various payout options, inflation protection and death benefit provisions.

Prudential – Highest Daily Lifetime Income 2.0 Benefit Rider
The firm introduced a new benefit product, Highest Daily Lifetime Income 2.0, to its suite of living benefit riders. The new living benefit replaces the pre-existing Highest Daily Lifetime Income and Spousal Highest Daily Lifetime Income benefits in all states where it has been approved. Key product features include daily step-ups for capturing portfolio gains, daily benefit base growth regardless of market conditions and a protected withdrawal value guarantee of 200% of the account value at election on the 12th anniversary.

Year-to-Date Summary
Fixed annuities continue to dominate among new annuity product releases in 2012. Through the first nine months, a total of six new fixed products and a new fixed index strategy have been introduced to the market by Annuity Monitor firms compared to only one new variable annuity. This past quarter also saw an uptick in new benefit rider products which serve to provide clients with the ability to capture gains from market upswings while also offering downside protection.