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 10th 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.
“Our growing range of income
solutions enables financial professionals to help Americans meet the
challenges of retirement income planning, while ensuring we provide a
compelling value proposition both for clients and Prudential,” said
Ferris.
Prudential Financial, Inc. (NYSE: PRU), a financial services leader, has
operations in the United States, Asia, Europe, and Latin America.
Prudential’s diverse and talented employees are committed to helping
individual and institutional customers grow and protect their wealth
through a variety of products and services, including life insurance,
annuities, retirement-related services, mutual funds and investment
management. In the U.S., Prudential’s iconic Rock symbol has stood for
strength, stability, expertise and innovation for more than a century.
For more information, please visit http://www.news.prudential.com/
All references to income certainty and guarantees, including optional
benefits, are backed by the claims-paying ability of the issuing company
and do not apply to the underlying investment options.
Investors should consider the features of the contract and the
underlying portfolios' investment objectives, policies, management,
risks, charges and expenses carefully before investing. This and other
important information is contained in the prospectus, which can be
obtained from your financial professional. Please read the prospectus
carefully before investing.
Variable annuities are issued by Pruco Life Insurance Company (in New
York, by Pruco Life Insurance Company of New Jersey), Newark, NJ (main
office) and distributed by Prudential Annuities Distributors, Inc.,
Shelton, CT. All are Prudential Financial companies and each is solely
responsible for its own financial condition and contractual obligations.
Prudential Annuities is a business of Prudential Financial, Inc.
Annuity contracts contain exclusions, limitations, reductions of
benefits and terms for keeping them in force. Your licensed financial
professional can provide you with complete details.
A variable annuity is a long-term investment designed for retirement
purposes. Investment returns and the principal value of an investment
will fluctuate so that an investor’s units, when redeemed, may be worth
more or less than the original investment. Withdrawals or surrenders may
be subject to contingent deferred sales charges. Withdrawals and
distributions of taxable amounts are subject to ordinary income tax and,
if made prior to age 59½, may be subject to an additional 10% federal
income tax penalty, sometimes referred to as an additional income tax.
Withdrawals, other than from IRAs or employer retirement plans, are
deemed to be gains out first for tax purposes. Withdrawals reduce the
account value, death benefits, and the annual amount of living benefit
available.
Asset allocation does not ensure a profit or protect against a loss.
Variable annuities offered by Prudential Financial companies are
available at a total annual insurance cost of 0.55% to 1.95%, with an
additional fee related to the professionally managed investment options.
Note: All products may not be available through all third party
broker/dealers. {[HD Lifetime Income v3.0 is available for an additional
annual fee of 1.00% based on the greater of the account value and the
Protected Withdrawal Value.] [Spousal HD Lifetime Income v3.0 is
available for an additional annual fee of 1.10% based on the greater of
the account value and the Protected Withdrawal Value.] [HD Lifetime
Income v3.0 with Highest Daily Death Benefit is available for an
additional annual fee of 1.50% based on the greater of the account value
and the Protected Withdrawal Value.] [Spousal HD Lifetime Income v3.0
with Highest Daily Death Benefit is available for an additional annual
fee of 1.60% based on the greater of the account value and the Protected
Withdrawal Value.] [HD Lifetime Income v3.0 with Highest Annual Death
Benefit is available for an additional annual fee of 1.40% based on the
greater of the account value and the Protected Withdrawal Value.]
[Spousal HD Lifetime Income v3.0 with Highest Annual Death Benefit is
available for an additional annual fee of 1.50% based on the greater of
the account value and the Protected Withdrawal Value.]} Please see the
prospectus for additional information.
Highest Daily Lifetime Income [v3.0] suite of benefits uses a
predetermined mathematical formula to mitigate some of the financial
risks we incur in providing the guarantees under the optional benefits
through all market cycles. Each business day, the formula determines if
any portion of the account value in the permitted subaccounts (asset
allocation portfolios), including any DCA MVA options needs to be
automatically transferred into or out of the AST Investment Grade Bond
Portfolio (the "Bond Portfolio"). Amounts transferred by the formula
depend on a number of factors unique to your clients’ individual annuity
and include:
(i) The difference between the account value and the Protected
Withdrawal Value;
(ii) How long your client has owned the benefit;
(iii) The amount invested in, and the performance of, the permitted
subaccounts, the Bond Portfolio, and the Secure Value Account and;
(iv) The impact of additional purchase payments made to, and
withdrawals taken from, the annuity.
The formula will not transfer amounts to or from the Secure Value
Account. On any given day, no more than 30% of the account value in the
Permitted Sub-accounts (plus any DCA MVA options) may be transferred to
the Bond Portfolio pursuant to the formula. Therefore, at any given
time, some, most or none of the account value from the permitted
subaccounts may be allocated to the Bond Portfolio. Transfers to and
from the Bond Portfolio do not impact any income guarantees that have
already been locked in. Your clients may not allocate purchase payments
or transfer account value into or out of the Bond Portfolio.
The formula could mean that your clients miss opportunities for
investment gains in the Permitted Sub-accounts while amounts are
allocated to the Bond Portfolio. The formula’s allocation of amounts to
the Bond Portfolio however, could also protect your clients’ account
value from losses that may occur in the permitted subaccounts. Please
note: We are not providing investment advice through the formula.
See the prospectus for complete details.
The Protected Withdrawal Value is only used to calculate the guaranteed
lifetime income and the charge for the benefit. It is separate from the
account value and is not available as a lump sum withdrawal. The account
value is not guaranteed, can fluctuate, and may lose value.
Please note lock-ins do not apply to the account value. The account
value is not guaranteed, can fluctuate, and may lose value.
Equity Securities Risk – The value or price of a particular stock
or other equity or equity-related security owned by a portfolio could go
down and you could lose money.
Fixed income investments are subject to risk, including credit and
interest rate risk. Because of these risks, a subaccount’s share value
may fluctuate. If interest rates rise, bond prices usually decline. If
interest rates decline, bond prices usually increase. The prices of
longer-term bonds are generally more sensitive to changes in interest
rates than those of shorter-term bonds.
© [2013] The Prudential Insurance Company of America.
Issued on contracts: P-BLX/IND(2/10) and P-CR/IND(2/10), et al. or state
variation thereof.
Issued on riders: P-RID-HD(3/13), P-RID-HD(3/13)-NY, P-RID-HD(2/14) and
P-RID-HD(2/14)-NY, P-RID-HD-HAB(2/14)-NY, P-RID-HD-HAB(2/14)
0257233-00001-00
Copyright Business Wire 2014