Phoenix Enhances Living Benefit Riders
September 20, 2008
The Phoenix Companies has enhanced its Phoenix Flexible Withdrawal Protector guaranteed minimum withdrawal benefit (GMWB) rider and launched a new combination benefit rider called the Phoenix Retirement Protector which offers a GMWB, a guaranteed minimum accumulation benefit (GMAB) and an optional guaranteed minimum death benefit (GMDB).
The riders, available for purchase with most Phoenix variable annuities, are meant to protect against the risk of high health care costs in retirement, such as nursing home expenses, and longevity risk, which is the risk they might outlive their assets.
“We’ve just seen what a lot of people refer to as an ‘arms race’ in the industry over the last few years where benefits keep getting richer, richer and richer,” said Tom Buckingham, senior vice president of product development, life and annuity.
In an enhancement to the GMWB that matches what many other issuers offer, Phoenix allows clients to double their benefit base if they don’t take any withdrawals in the first 10 contract years. There’s also an opportunity to reset that period and lock in early gains.
The fees for the Phoenix Flexible Withdrawal Protector range from .50% to 1.35% for a single life, and .70% to 1.70% for spousal coverage, of the greater of the benefit base or contract value. The fees for the Phoenix Retirement Protector range from .85% to 1.70% for a single life, and 1.05% to 2.05% for spousal coverage, of the greater of the GMWB benefit base or contract value.
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