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Accumulation Phase
Inflation and Downside Market Protection
Any time after age 50, you can activate the GLWB rider and enter the Accumulation Phase. While in the Accumulation Phase and providing no withdrawals are taken, your Premium Accumulation Value accumulate 5% each year for 10 years, which can help provide inflation and downside market protection. Note that this is for the purpose of calculating future withdrawals under the provisions of the rider and does not affect the policy's surrender value.
Premium Accumulation Value is defined as initial premium if the rider activation date is the same as the policy date, or policy value as of the rider activation date if this date is later than the policy date. During the same 10-year period, the policy values on each anniversary are tracked to determine the Maximum Anniversary Value. The Premium Accumulation Value and Maximum Anniversary Policy Value will continue to be tracked until the policy enters the Withdrawal Phase.
Calculating Lifetime Withdrawals
Policy Value, Premium Accumulation Value and Maximum Anniversary Value will eventually determine the amount of the lifetime withdrawals as explained in the Withdrawal Phase. Policy Value will not be affected by the Premium Accumulation Value and Maximum Anniversary Policy Value.
Annual Reset
With the annual reset feature, you can:
• lock in any gains and
• enjoy downside protection.
On each policy anniversary during the Accumulation Phase, the Premium Accumulation Value will be reset to the Policy Value if it is greater. A reset locks in any gains and starts a new ten-year period, increasing the time a guaranteed 5% annual compounded rate of return is provided on the rider’s Premium Accumulation Value. An increase in the cost of the rider will take effect upon reset if the current cost is greater. You may choose to “opt out” of the Annual Reset. If there is a reset at any time in the Accumulation Phase, a new 10-year period begins.
Withdrawal Flexibility
One withdrawal per year is allowed during the Accumulation Phase. This withdrawal flexibility:
• ensures access to your money if you need it,
• protects your active position in the Accumulation Phase, and
• allows you to delay the start of the Withdrawal Phase.
A withdrawal will reduce the Premium Accumulation Value and Maximum Anniversary Policy Value proportionately by the amount of the withdrawal to the policy value. In addition, there is no 5% accumulation of the Premium Accumulation Value in the year a withdrawal is made. The 5% accumulation of the Premium Accumulation Value will be available starting the next year provided no withdrawals are taken in that year.
Taxes are not owed on earnings until withdrawn, usually at retirement. For Individual Retirement Accounts (IRAs) the premium is also tax-deferred until withdrawn.
The hypothetical examples on this page do not reflect the past or future performance of any investment portfolio. They assume no additional purchase payments, rider charges, mortality and expense risk charges, administrative charges or underlying portfolio expenses. Actual Premium Accumulation Values may vary. A zero percent gross rate of return is included on the graphs for comparison purposes to show what could happen to policy value in a flat market.
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