Posted by OnAmerican Life Insurance GuideIn the previous column, we mentioned a term unique to American insurance:Rider, the Chinese meaning refers toadditional terms.
This Rider is not that Rider
As the interest rate environment gradually climbs, offering "guaranteed income"Annuity insurance, has become a product favored by investors in the current interest rate environment.
Second half of 2022 according to U.S. life insurance guidelinesInsurance account opening data list, the new account opening premium for this type of savings policy,Growth reached 138%.
What exactly do these insurance contract clauses mean?Why policyholders should buy it,And what are the tips for purchasing such insurance contracts?With these questions in mind, American insurance financial advisors Heather Xiong CFP®️An easy-to-understand answer was given to the policyholder.
What are the additional terms of the guaranteed income?
"Income guarantee rider" is an additional insurance clause provided in annuity insurance, which aims to guarantee investors' annualized rate of return.It provides a guarantee for policyholders to ensure that within a certain period of time, no matter how the external market falls, they can obtain the minimum guaranteed rate of return.
When investors purchase annuity insurance and choose to add an income guarantee rider, they will reach an agreement that the insurance company will calculate the minimum guaranteed return based on the investment amount and the agreed guaranteed interest rate.If the actual return on investment is higher than the guaranteed interest rate, the policyholder will receive a higher return.However, even if the market does not perform well, policyholders are assured of receiving at least the agreed minimum guaranteed return.
(>>>Related reading:Evaluation｜$30 retirement annuity insurance, how much money can you guarantee to receive every year?)
in simpler terms
Heather Xiong CFP®️A more concise analogy is provided to the public - similar to a time deposit in a bank, the insurance company promises to give the policyholder a fixed interest rate and writes this guarantee in the contract.
Taking today's market interest rate as an example, the insurance company may give an offer. If the policyholder deposits the premium in the insurance company, he will start to withdraw his pension after 3 years; during these three years, the insurance company will give an offer equal to or not less than 5 % Guaranteed Interest*.
Policyholders can choose 1-year, 2-year, 3-year, or even 10-year insurance products.
The interest of different insurance products changes daily with the market. You can enter an email at the end of the text to subscribe to "Multi-Year Annuity Insurance Policy Market Interest Rate" to obtain the latest weekly insurance deposit interest rate.
When can I buy this type of insurance policy?
This type of insurance product with guaranteed annualized rate of return can be purchased at any time.
In a low interest rate environment, the guaranteed annualized rate of return of this type of insurance will be lower,Usually do not attract too much attention from investors;
But in an environment of rising interest rates,Such policies are more sensitive to interest rates, and insurance companies usually offer higher guaranteed yields.
比如在2023年第一季度，5年期MYGA年金保险的保证利率突破了5%。而在2019年第四季度，同类保险产品的保证利率在2%-3%左右浮动。
In a high interest rate environment, this type of insurance product that provides a guaranteed rate of return,It can lock in the rate of return in the next few years for investors in advance,Therefore, it is favored by the current market.
>>>TheLifeTank – Consumer Evaluation Center for Annuity Insurance Products
Article summary
As the interest rate environment gradually climbs, providing"Guaranteed income"Many years ago, annuity insurance occupied a major share of the current insurance market.
With the intensification of market competition, in addition to providing "guaranteed income" interest rates, insurance companies also provide additional bonus incentives to attract policyholders, such as the previously reported 20% premium bonus, and the recent offering of 32% in the market. % Bonus rewarded products and more.
It is worth noting that specific terms and guaranteed rates may vary with different insurance companies and products.Before opening an account, policyholders can combine their own goals, according to different productsReviews and Rates, with the assistance of professional insurance financial consultants, open an account and purchase.
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