Prudential Annuities, the domestic annuity business of Prudential Financial, Inc. (NYSE:PRU), today announced the launch of a new version of its innovative Highest Daily variable annuity optional living benefits, which allow investors to ‘lock in’ the highest daily value of their annuity contract, for income purposes, each day the market is open.
Responding to unprecedented market demand for products that guarantee retirement income, Highest Daily Lifetime Income v3.0 and Spousal Highest Daily Lifetime Income v3.0 offer:
Dynamic Rate Setting: the flexibility to change the roll-up rate and/or the withdrawal percentages for new contracts in response to market conditions. The introductory rates include a 5 percent roll-up rate, and withdrawal percentages that range from 3-6 percent, including a 5 percent guaranteed lifetime annual withdrawal starting at age 65. Spousal versions are .50 percent lower for all age bands.
Secure Value Account: designed to help minimize volatility, the secure value account is a fixed-rate account that provides growth and stability to the annuity’s account value regardless of market conditions. Ten percent of each purchase payment will be allocated to the secure value account.Investment Platform Updates: the addition of two new asset allocation portfolios: the AST T. Rowe Price Growth Opportunities Portfolio, an 85/15 (equity/bond) model; and the AST FI Pyramis ® Quantitative Portfolio, a 65/35 (equity/bond) model. This brings the total number of asset allocation portfolios to 22. “Today’s launch reinforces our commitment to providing Americans with income certainty in retirement,” said Bruce Ferris, president, Prudential Annuity Distributors. “Our innovative Highest Daily benefits continue to provide investors with a strong minimum lifetime income guarantee, daily lock-ins of account value highs for income purposes, and the potential to benefit from rising equity markets, as well as help secure protection in unfavorable ones.” Highest Daily Lifetime Income v3.0 replaces Highest Daily Lifetime Income v2.1 and Spousal Highest Daily Lifetime Income v2.1 benefits, subject to state approval. Launched in 2006 and available for an additional fee with a variable annuity from Prudential issuing companies, Prudential Annuities’ Highest Daily suite of living benefits offer daily lock-ins for retirement income purposes—and immediately grow them until the first lifetime withdrawal or 10 years from election. Key features include:
- Daily step-ups: 100% certainty in capturing account value gains for income purposes, until first lifetime withdrawal.
- Daily benefit base growth: Benefit base grows every day regardless of market conditions due to immediate credit of the growth rate, until the 10 th benefit anniversary or the first lifetime withdrawal, whichever is sooner.
- Innovative investment platform: Offering 22 actively managed asset allocation portfolios that help to drive daily step-ups.
- Proprietary Risk Management: A proprietary mathematical formula that monitors an investor’s account daily and automatically transfers amounts between the chosen variable investment portfolios and the AST Investment Grade Bond Portfolio.
- Highest Daily Death Benefit: Offers legacy protection through an optional integrated death benefit that locks in account highs daily, for an additional fee.