equity-indexed annuity


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Equity-Indexed Annuity

An annuity with an interest rate linked to the performance of an equity index. Most annuities pay the interest rate stated in the contract, but an equity-indexed annuity pays a minimum interest rate, with the possibility of a higher rate depending on the performance of the relevant stock or equity index. Each plan uses a different methodology in determining how the higher interest rate is calculated. Common features in its calculation include a participation rate, which determines how much of the annuity is linked to the index, and the rate cap, which sets a maximum interest rate on some plans. Many equity-index annuities use the Standard & Poor's 500 Composite Stock Price Index (S&P 500) as their benchmark.

equity-indexed annuity

A contract with an insurance company that promises periodic payments keyed in a specified manner to a stock market index. Unlike variable annuities, equity-indexed annuities specify a guaranteed minimum return that is typically 3%. These contracts may also specify an upper limit (cap) on the return that is paid. Indexing methods vary, and surrender charges often apply to early withdrawals.
References in periodicals archive ?
According to Athene, its products consist of retail-fixed and equity-indexed annuity products; institutional products, like funding agreements; and co-insurance and reinsurance arrangements with third-party life insurance and annuity providers.
An equity-indexed annuity (EIA) is an insurance product with benefits linked to the performance of an equity market.
An equity-indexed annuity is a type of variable annuity whose return is based on the performance of a specified equity index, such as the S&P 500 Composite Stock Price Index.
has launched Conseco Command, a single-premium equity-indexed annuity that provides predetermined "free-out" windows for owners to access funds without surrender charges.
Equity-indexed annuity sales are a jurisdictional jump-ball, because it isn't clear whether they're securities, insurance products or something in between.
NWL's net premium growth in recent years has been primarily driven by its equity-indexed annuity (EIA) segment.
During two historic, long and lackluster stock-market periods, the right kind of equity-indexed annuity would have outperformed the Dow Jones Industrial Average, including reinvested dividends, according to Pete Winer, a chartered financial consultant with Covenant Reliance Producers LLC, Nashville, Tenn.
Sun Life Financial is among the top equity-indexed annuity carriers and is committed to remaining an industry leader in the EIA marketplace," says Kevin Hart, President, Sun Life Financial Distributors, Inc.
equity-indexed annuity market and its very strong risk management practices.
AmerUs Group has introduced a minimum withdrawal benefit for its equity-indexed annuity line.
June 9 /PRNewswire/ -- Further strengthening its competitive portfolio of fixed life insurance and annuity products, Aviva Life Insurance Company (Aviva) recently launched the S&P 500(R)*-based Aviva Progressive Index Annuity, an equity-indexed annuity featuring an innovative Breakthrough Account.
Fitch's concerns relate to integration risk, particularly in the area of distribution, and Aviva's increased exposure to the equity-indexed annuity (EIA) market through AmerUs.