Retirement Products and Plans

Annuities
An annuity is a contract in which the policyowner pays a single premium or a series of premiums to an insurer. The insurer then promises to provide a series of periodic payments at the time when the owner makes such an election, provide a death benefit , or return the cash surrender value to the owner upon request. Some policyowners elect an anuitization option once they retire and need to supplement their income with additional monies. Many annuity policyowners use their annuity as a tax-deferred savings vehicle.

Single Premium Deferred Annuity (SPDA)
An SPDA is a tax-deferred annuity that will only accept a single payment. This payment may be from writing a check directly to the company or through a transfer or rollover. Single Premium Deferred Annuities may be purchased with qualified or non-qualified monies. (See Plan Types below)

Flexible Premium Deferred Annuity (FPDA)
An FPDA is a tax-deferred annuity that will accept multiple premium payments while the annuity is in an accumulation period. FPDA annuities may accept salary reduction payments, bank draft or pre-authorized check plan payments, transfers, rollovers, and single sum direct payments. Some Flexible Premium Deferred Annuities require ongoing payments while others do not. FPDAs may be purchased with qualified or non-qualified monies. (See Plan Types below)

Equity Indexed Annuity (EIA)
An Equity Indexed Annuity is usually a fixed (i.e., not a variable) annuity with alternate methods of determining and crediting interest. While traditional fixed annuities typically declare interest in advance for premium payments based on the performance of the company's underlying investments for those premiums, an EIA's interest is determined, at least in part, by the performance of a specified index of marketplace performance (frequently the S&P 500 Index® or Russell 2000®) † over a stated period. For instance, the interest credit for an EIA might be defined as 70% of the rate of increase in the S&P 500 Index® over each one-year period. Different EIAs present different methods of determining the interest credits.

Unlike traditional fixed annuities, the policyowner may receive zero interest for a single period on a specific premium payment if the index performs poorly *. However, with most EIA designs, the premiums are protected and guaranteed to grow over time **. This is a feature unavailable with any form of direct participation in the marketplace, such as through a mutual fund or a variable annuity. Moreover, in better market conditions, the owner of an EIA may experience interest credits that outperform traditional fixed annuities. Because it is an annuity rather than a mutual fund, the EIA offers important insurance features including tax deferral, a death benefit that may be paid outside probate, and annuitization.