American General Life Insurance Company Announces Launch of AG Choice Index 10(SM) Annuity with AG Lifetime Income Plus(SM) Optional Guaranteed Living Benefit Rider
April 16, 2013 by N/A
Income Solution Can Help Individuals Guarantee More Income for Retirement by Providing Potential to Double Retirement Income in Just 10 Years
HOUSTON, Apr 15, 2013 (BUSINESS WIRE) — American General Life Insurance Company (American General) is proud to announce its new AG Choice Index 10(SM) annuity. This new index annuity offers upside growth potential with the guaranteed protection of a traditional fixed annuity.
AG Choice Index 10 can help individuals grow their retirement income without the risk of market loss. Contract owners receive a 4% premium enhancement on every premium paid in the first 30 days of the contract, a rate that may be difficult to match in today’s low interest rate environment. Plus, they have the opportunity to earn additional interest based in part on the movement of the S&P 500(R) index without dividends. AG Choice Index 10 offers three interest-crediting strategies – a 1-year fixed interest account, an annual point-to-point index interest account, and a monthly point-to-point additive index interest account. When the S&P 500(R) is up, a client can earn interest based in part on the performance of the S&P 500(R). When the market is down, the annuity contract is guaranteed never to lose value due to market fluctuations.
“The new AG Choice Index 10 annuity is a great retirement income solution in today’s market,” said John Deremo, Executive Vice President and Chief Distribution Officer, Life and A&H, AIG Financial Distributors. “We’re in a historically low interest rate environment that has proved especially challenging for individuals seeking higher income. AG Choice Index 10 can provide these individuals with an attractive solution to grow a portion of their assets over the long term, while protecting their principal in a down market. Plus, thanks to our new optional guaranteed living benefit rider, AG Lifetime Income Plus, individuals have the opportunity to double their retirement income potential after just 10 years if they wait to take withdrawals.”
With AG Lifetime Income Plus, the Income Base–the amount on which lifetime withdrawals are based–is guaranteed to double to 200% of premiums paid, as long as no withdrawals are taken before the 10th contract anniversary. The rider also guarantees that retirement income will rise by 7% each year that withdrawals are not taken in the first 10 contract years. Contract owners can take out guaranteed withdrawals of up to 6% per year for life depending on when withdrawals begin and on how many individuals are covered. To receive these guaranteed benefits, withdrawals must be taken according to the terms of the rider.
“AG Lifetime Income Plus is the only living benefit rider in the index annuity industry today that offers the opportunity to double an individual’s Income Base over the contract’s first 10 years,” said Deremo. “Combining guaranteed income growth with lifetime withdrawals of up to 6% can help individuals secure more income for their future. We are confident that our new index annuity and guaranteed living benefit rider can be an important part of an individual’s retirement savings.”
“People are struggling with new retirement realities – many do not have enough money saved to last their entire lifetime, retirement costs continue to rise and the market has been especially volatile over the last decade,” said Rob Scheinerman, Chief Product Officer, AIG Life and Retirement. “People want protection and guarantees but need an opportunity to also grow their retirement savings without downside risk. This is precisely what AG Choice Index 10 and AG Lifetime Income Plus offer.”
“AIG Life and Retirement is keenly focused on our mission to be the premier provider of income solutions needed for financial and retirement security. American General’s new index annuity and guaranteed living benefit rider are only two of a number of product launches we have planned across our businesses this year,” said Scheinerman.
Annuities are issued by American General Life Insurance Company (AGL), 2727-A Allen Parkway, Houston, Texas 77019. AG Choice Index 10 Modified Single Premium Deferred Fixed Index Annuity, Contract Number AG-801 (12/12); Premium Enhancement Rider, Form Number AGE-8001 (12/12); Annual Point-to-Point Index Interest Account Rider, Form Number AGE-8003 (12/12); Monthly Point-to-Point Additive Index Interest Account Rider, Form Number AGE-8005 (12/12); AG Lifetime Income Plus Guaranteed Living Benefit Rider, Form Number AGE-8002 (12/12).
The underwriting risks, financial and contractual obligations and support functions associated with products issued by American General Life Insurance Company (AGL) are its responsibility. AGL does not solicit business in the state of New York. The annuity may not be available in all states. Guarantees are subject to the claims paying ability of AGL.
Index annuities are not a direct investment in the stock market. They are long-term insurance products with guarantees backed by the claims-paying ability of the issuing insurance company. They provide the potential for interest to be credited based in part on the performance of the specified index, without the risk of loss of premium due to market downturns or fluctuations. Index annuities may not be suitable or appropriate for all clients.
Withdrawals may be subject to federal and/or state income taxes. An additional 10% federal tax may apply if clients make withdrawals or surrender their annuity before age 59-1/2. Beginning January 1, 2013, annuity income will be subject to an additional tax of 3.8% under specific factual situations. Clients should consult their tax advisor regarding their specific situation.
AG Lifetime Income Plus(SM) is optional and available at contract issue in select American General Life index annuities for an additional fee. Restrictions and limitations apply. Contract and optional living benefit guarantees are backed by the claims-paying ability of the issuing insurance company.
The Income Base is the amount on which lifetime withdrawals are based; it is not used in the calculation of the contract value or any other benefits under the contract, and cannot be withdrawn partially or in a lump sum. The Income Base is initially equal to the first eligible premium and premium enhancement. On each contract anniversary for up to 10 years, the Income Base is guaranteed to grow by a 7% income credit, as long as no withdrawals have been taken for that year. On the 10th contract anniversary, the Income Base may be increased to the Minimum Income Base (200% of eligible premiums) if no withdrawals have been taken from the contract. The Income Base is adjusted for excess withdrawals and is increased each time an eligible premium and premium enhancement is made.
The Maximum Annual Withdrawal Amount (MAWA) is a percentage of the Income Base and varies from 3.25% to 6% depending on whether one or two people are covered and their age at the time of the first withdrawal. If the contract value is completely depleted due to withdrawals taken within the terms of the rider, clients will receive the Protected Income Payment for life. The Protected Income Payment percentages are the same as the MAWA percentages under this rider.
American General Life Companies, www.americangeneral.com, is the marketing name for a group of affiliated domestic life insurers, including American General Life Insurance Company (AGL). American General Life Companies insurers offer a broad spectrum of life insurance, fixed annuities and accident & health products to serve the financial and estate planning needs of its customers throughout the United States.
AIG Life and Retirement is one of the largest and strongest life insurance and retirement services organizations in the United States. The organization traces its origins to 1850 and today, AIG Life and Retirement companies are among the largest issuers of annuities and life insurance in the United States as well as leading providers of defined contribution plans in the education and healthcare markets. Through its American General, AGLA, VALIC, Western National, SunAmerica, FSC Securities, Royal Alliance, SagePoint Financial and Woodbury Financial brands, it offers a diverse family of life insurance, investment and retirement savings products. AIG Life and Retirement serves over 18 million customers and its products are sold by over 300,000 financial professionals. For more information, please visit www.aig.com/lifeandretirement.
The S&P 500 Index is a product of S&P Dow Jones Indices LLC (“SPDJI”), and has been licensed for use by American General Life Insurance Company and affiliates. Standard & Poor’s(R), S&P(R), and S&P 500(R) are registered trademarks of Standard & Poor’s Financial Services LLC (“S&P”); Dow Jones(R) is a registered trademark of Dow Jones Trademark Holdings LLC (“Dow Jones”); and these trademarks have been licensed for use by SPDJI and sublicensed for certain purposes by American General Life Insurance Company and affiliates. American General Life Insurance Company and affiliates’ products are not sponsored, endorsed, sold or promoted by SPDJI, Dow Jones, S&P, their respective affiliates, and none of such parties make any representation regarding the advisability of purchasing such product(s) nor do they have any liability for any errors, omissions, or interruptions of the S&P 500 Index.
Not FDIC or NCUA/NCUSIF Insured May Lose Value * No Bank or Credit Union Guarantee Not a Deposit * Not Insured by any Federal Government Agency
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SOURCE: American General Life Companies
