Deferred Variable Annuity – Rollup Rates: Part 2
July 15, 2020 by Wade Pfau
How long does the guaranteed rollup rate last? Does it have any other features?
Guaranteed rollup rates for the benefit base generally end once guaranteed distributions from the contract have commenced. As well, in cases where those distributions do not begin for a long period of time, the rollup rate may only last for a certain number of years.
Some variable annuities may have other guaranteed growth features as well. For instance, one might see a bonus applied to their initial premium, such that the initial benefit base is higher than the premium. Another possibility could be that the benefit base is guaranteed to double after a certain number of years if underlying contract value growth did not otherwise jump far enough ahead of the guaranteed rollup rate to have independently caused this.
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