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New York Life Lets Lifetime Income Annuity Customers Capitalize On Potential Interest Rate Increases

New Feature Allows Customers to Increase Future Lifetime Income While Receiving Guaranteed Payments That Will Never Decrease

NEW YORK, N.Y., July 24, 2006 — New York Life Insurance and Annuity Corporation1 today announced the Income Enhancement Option, a new optional feature available for its Lifetime Income Annuity that gives policyholders the best of both worlds: the ability to secure guaranteed lifetime income and potentially benefit from higher interest rates in the future. Policyholders selecting the Income Enhancement Option2 know that while their guaranteed payments can increase when interest rates rise, their payments will never decrease, no matter how low interest rates decline.

"With Americans living longer in retirement than at any time in history, guaranteed lifetime income is an essential element of retirement income planning," said Paul Pasteris, senior vice president, New York Life. "Our goal is to deliver lifetime income options that can meet a wide variety of customer needs. Through this new option, customers receive the security and peace of mind of a guaranteed paycheck for life today, combined with the opportunity to participate in potential gains from rising interest rates tomorrow. This is another way to offer flexible guaranteed lifetime income together with the stability and financial strength that only New York Life can provide."

When policyholders select the Income Enhancement Option, their annuity income can increase to reflect higher interest rates if a benchmark index is at least 2% higher on the policy's fifth anniversary than it was at the time the policy was purchased.3 These higher monthly payments will continue for the rest of the policyholder's life. The potential increase amount is fixed when a policy is purchased and is clearly illustrated to policyholders. If the benchmark rate does not increase by 2%, policyholders will continue to receive the same income amount they purchased when they bought the policy, guaranteed for life. The policy's benchmark index is the Federal Reserve Board's Ten–Year Constant Maturity Treasury Index.

For example,4 a 65–year old male who purchases a Lifetime Income Annuity with the Income Enhancement Option might receive $500 monthly for the first five years. If the benchmark index rate is at least 2% higher on the policy's fifth anniversary, the monthly payment will increase 18% to $590, totaling more than $16,200 in additional income over the next fifteen years, and $32,400 if the policy owner lives to age 100.

This new Income Enhancement Option joins a selection of other Lifetime Income Annuity innovations. The recently introduced Changing Needs Option5 adds longevity protection to the cash flow management role that retirees seek from immediate annuities. It allows policyholders to increase or decrease future annuity payments to suit personal needs and preferences. This product also offers an inflation protection option6 and a number of other flexible features, including the ability to accelerate some payments to meet short–term needs and a one–time withdrawal feature that enables policyholders to access a portion of their future payments if needed.7

For more information about the Income Enhancement Option, please click here.

New York Life Insurance and Annuity Corporation is a subsidiary of New York Life Insurance Company, a Fortune 100 company founded in 1845. New York Life Insurance Company is the largest mutual life insurance company in the United States and one of the largest life insurers in the world. Headquartered in New York City, New York Life's family of companies offers life insurance, annuities, and long–term care insurance. New York Life Investment Management LLC 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.

1 New York Life Insurance and Annuity Corporation is a wholly owned subsidiary of New York Life Insurance Company.

2 The Income Enhancement Option must be elected at the time you purchase your policy. It is available only on non–qualified policies in approved jurisdictions. The owner of the policy must be 59 ½ at the time of the first payment, and the annuitant must be age 75 or younger at the time the policy is issued. If electing a joint policy, there may be no reduction of benefits. If you elect the Income Enhancement Option, neither the Changing Needs Option nor the Inflation Protection Option are available.

3 The higher income benefit will be paid if the difference between the Ten–Year Constant Maturity Treasury Index rate in the third full week of the calendar month immediately preceding the policy date and the third full week of the calendar month immediately preceding the fifth policy anniversary is 2% or more. The higher income benefit would begin on the first scheduled payment following the fifth policy anniversary.

4 The example is hypothetical and your situation may differ. It is not intended to predict or project investment results. Please consult your New York Life agent to discuss your individual situation.

5 This option is currently not available in all jurisdictions.

6 This feature is available only if the annuity owner is over age 59½ at the time of the first payment.

7 Only available on non–qualified policies and if the owner is age 59 ½ or older. Amounts received may be fully taxable. Some features are not available in all jurisdictions.

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New York Life Lets Lifetime Income Annuity Customers Capitalize On Potential Interest Rate Increases

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