Security Benefit Life Insurance Company, a US retirement savings and annuities provider, has added four new index accounts to its Total Value Annuity: one and two year accounts based on the S&P 500 Low Volatility Daily Risk Control 5% Index (S&P 500 Low Vol RC 5%), and one and two year accounts based on the S&P Multi-Asset Risk Control (Marc) 5% Index (S&P Marc 5%).
According to Doug Wolff, Security Benefit's President, the firm's Total Value Annuity has offered consumers growth potential along with the ability to create a guaranteed stream of lifetime income, or to leave a legacy for others. "Adding new index accounts gives financial professionals more options to diversify client portfolios and help clients reach their retirement-planning goals," said Wolff.
The S&P 500 Low Vol RC 5% Index represents a portfolio that combines the S&P 500 Low Volatility Index with an interest-accruing cash component. Stocks in the index are weighted according to their volatility, with the least volatile stocks receiving the highest weights. On a daily basis, the S&P 500 Low Vol RC 5% is dynamically rebalanced between the stock component and the cash component to achieve a target annualized volatility of five percent. This is the first time the S&P 500 Low Vol RC 5% has been featured in a indexed annuity but the index appears in five live products in the US market including four market-linked certificates of deposit and one structured note.
The S&P Marc 5% Index is designed to track the performance of a risk-weighted portfolio consisting of three asset classes - equities, commodities and fixed income - represented by three component indices: the S&P 500 Excess Return Index, the S&P GSCI Gold Excess Return Index and the S&P 10-Year US Treasury Note Futures Excess Return Index. S&P Marc 5% is dynamically rebalanced between the three indices and the cash component to target a five percent level of volatility.
With the additions, the Total Value Annuity now offers nine index interest crediting options and one fixed account option including the S&P 500 Index without dividends; S&P 500 Low Volatility Daily Risk Control 5% Index (1 Year and 2 Year Point to Point index options); S&P Multi-Asset Risk Control (MARC) 5% Index (1 Year and 2 Year Point to Point index options); BNP Paribas High Dividend Plus Index (1 Year and 2 Year Point to Point index options); Annuity Linked TVI Index (5 Year Point to Point); and Guggenheim RBP Blended Index (5 Year Point to Point).
S&P is one of the leading providers of risk control indices to the global retail structured products market with over 1,000 products benchmarked to its low volatility and risk control benchmarks. SRP data shows that risk control indices are popular with pension and life insurance products. Other risk control indices.
Other popular risk control indices used in the US annuities market include the Barclays Armour EUR Index (21 products), Citi Dynamic Asset Selector 5 ER Index (14 products), and Goldman Sachs DynaMO8 ER (six products).
Click in the link to see the brochure of Security Benefit's new fixed indexed annuity.
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