New Feature Provides Further Customization of One's Income Annuity to Meet Needs in Retirement
NEW YORK, N.Y., December 15, 2010 – New York Life Insurance and Annuity Corporation1 today announced the launch of an Installment Refund feature to provide its lifetime income annuity policy owners another option to guarantee a return of premium.
"The ability to leave a legacy while ensuring one's own retirement income is a priority for many retirees. New York Life remains committed to providing retirees with tools to customize their assets to help meet their individual needs and the Installment Refund option, where beneficiaries can receive payments on a scheduled basis, provides policy owners another way to meet their retirement goals and legacy wishes at the same time," said Matt Grove, vice president of Retirement Income Security, New York Life. "The Installment Refund option expands on our most utilized legacy feature, the Cash Refund option. Providing retirees the comfort of a paycheck every month with the added benefit that their beneficiaries will be provided for has remained a popular choice among retirees and we anticipate the Installment Refund feature will be a well-received addition to the features and benefits on our lifetime income annuity."
The Installment Refund feature provides its lifetime income annuitants the ability to provide their beneficiaries with the return of premium, less all payments made, on a scheduled installment basis.2 The Installment Refund option expands the menu of payment options for annuitants to help ensure a guaranteed legacy for heirs. In addition to the new Installment Refund option, the other legacy options include the Cash Refund option, where the beneficiaries will receive a lump sum equaling the premium less all payments made2 and the percent of premium death benefit3, which offers beneficiaries a death benefit totaling 25% or 50% of the original premium chosen at policy issue.
"Today's retirees and pre-retirees recognize that income annuities are a way to ensure their savings will last and gives them the freedom to enjoy their retirement on their own terms," added Mr. Grove. "In the wake of the financial crisis, liquidity needs have been more prominent for many retirees and we have seen an increase in policy options that offer the ability to access one's original investment in the policy if needed."
- Consumers can access their investment in the policy beyond the scheduled income payments in the event additional funds are needed due to unexpected circumstances. Each policy includes two withdrawal features4 that provide access to cash after the policyholder is at least age 59½-a Payment Acceleration feature and Cash Withdrawal feature:
- Payment Acceleration allows policy owners to receive their next scheduled monthly payment, along with the five subsequent payments - for a total of six months of income payments all at once. When this option is exercised, income payments will not be paid for the next five months.
- Cash Withdrawal provides a one-time opportunity to receive the discounted value of future payments5through one of two features: "Up to 100%" Cash Withdrawal which allows policy owners to withdraw up to 100% of the discounted value of remaining guaranteed payments at any time during the guaranteed period6; and the 30% Cash Withdrawal feature allows policy owners to withdraw 30% of the discounted value of future expected payments, and may be exercised on certain policy anniversaries or at any time upon proof of a significant, non-medical financial loss. 7
"Our comprehensive features and benefits, developed over the better part of a decade, are a key reason that New York Life has been the clear market leader in lifetime income annuities since 20068. Our aim is to continue to be the most customer-focused annuity provider, with features that help consumers acquire an important foundation for generating income in retirement," said Mr. Grove.
New York Life Insurance Company, a Fortune 100 company founded in 1845, is the largest mutual life insurance company in the United States* and one of the largest life insurers in the world. New York Life has the highest possible financial strength ratings from all four of the major credit rating agencies. Headquartered in New York City, New York Life's family of companies offers life insurance, retirement income, investments and long-term care insurance. New York Life Investments** provides institutional asset management and retirement plan services. Other New York Life affiliates provide an array of securities products and services, as well as institutional and retail mutual funds. Please visit New York Life's Web site at www.newyorklife.com for more information.
*New York Life is the largest mutual life insurance company based on the Fortune500 , ranked within industries, Insurance: Life, Health (Mutual), Fortune magazine, May 3, 2010.
**New York Life Investments is a service mark used by New York Life Investment Management Holdings LLC and its subsidiary, New York Life Investment Management LLC.
1New York Life Lifetime Income Annuity is issued by New York Life Insurance and Annuity Corporation is a wholly owned subsidiary of New York Life Insurance Company. 51 Madison Avenue, New York, NY 10010. Guarantees are backed by the claims-paying ability of the issuing company.
2If the total payments received prior to the annuitant's death equal or exceed the initial premium paid for the policy, then no further payments will be made to beneficiaries upon death.
3This feature is currently not available in all jurisdictions. The Cash Refund, Installment Refund and Percent of Premium Death Benefit payout options pay a lower income amount for the same premium than one that does not provide a guaranteed death benefit, but it ensures a legacy for the policy owner's heirs.
4Available where approved, restrictions and taxes may apply.
5The cash withdrawal amount is subject to an Interest Rate Change Adjustment that will increase or decrease the withdrawal amount based on the change in interest rates, as measured by the 10-Year CMT, between the time of purchase and the time of the cash withdrawal.
6Once this option is exercised, future income payments through the end of the guaranteed period will be reduced by the withdrawal percentage elected. If the annuitant is alive at the end of the guaranteed period, full annuity payments will then resume for the life of the policy. This feature is available only on non-qualified policies with a Life with Cash Refund, Life with Installment Refund or Life with Period Certain payout option.
7Payments are paid based on the annuitant's life expectancy at the time of purchase. This feature may be exercised on the 5th, 10th or 15th anniversary of the first income payment, or upon proof of a significant, non-medical financial loss as specified in the policy. This non-medical financial loss provision is not available in all jurisdictions. Once this option is exercised, future income payments will be reduced by 30% for the life of the policy. Not available after the annuitant's life expectancy. This feature is available on all qualified policies, and non-qualified policies with a Life Only or Life with Percent of Premium Death Benefit payout option.
8LIMRA 2010. For most jurisdictions, the policy form numbers for New York Life Lifetime Income Annuity are 203-173 for the Life Annuity with Cash Refund and 210-195 for the Life Annuity with Installment Refund. For most jurisdictions, rider form numbers are 206-308 and 206-309 for the 30% Cash Withdrawal Rider and 206-310 for the up to 100% Withdrawal Rider.
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|New York Life Launches Installment Refund Feature On Income Annuity To Provide Even Broader Legacy Benefit Options|