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Security Benefit launches Foundations Annuity


Security Benefit Corporation, a provider of retirement savings and income vehicles for America’s pre- and post-retirees, has launched Foundations Annuity, a next-generation fixed indexed annuity (FIA).

Security Benefit Life Insurance Company, a Guggenheim Partners company, designed the Foundations Annuity to protect principal, provide a guaranteed income stream for life and an interest-crediting opportunity tied to equity-market growth, and allow retirees greater liquidity than was associated with prior-generation FIAs.

According to Doug Wolff, president of Security Benefit Life Insurance Company, his firm’s latest offering represents a significant step forward in the financial industry’s efforts to help Americans meet the retirement income challenge.

"In this market environment, where future risks to retirees’ already damaged capital are as great as they have ever been, FIAs may be a compelling choice," says Wolff. "Combining Foundations Annuity and its leading-edge design with traditional drawdown strategies may greatly enhance the likelihood of generating a steady stream of income retirees cannot outlive."

Wolff adds that Foundations Annuity was designed to provide a "missing element" in retirement drawdown plans. Security Benefit engaged a leading actuarial consulting firm to conduct a research project designed to understand the optimal product mix for generating retirement income. The results of the study underscored that FIAs with guaranteed lifetime withdrawal benefits (GLWBs) combined with traditional portfolio drawdown strategies significantly increase the probability of providing lifetime income. Further, the data show that the combination of an FIA with a GLWB rider and traditional mutual fund drawdown strategy was more likely to sustain annual income throughout retirement than either a traditional mutual fund drawdown strategy alone or a combination of a variable annuity with GLWB rider and a traditional mutual fund drawdown strategy.

In addition to a guarantee of principal and a one per cent bonus on first-year premium payments, Foundations Annuity offers three interest-crediting strategies tied to potential equity market growth. 

Foundations Annuity also offers an optional GLWB Rider with attractive guaranteed payout rates and less complexity than many FIAs.

The Wealth Adviser Awards 2013 for the top wealth manager and service providers will be held in London towards the end of Q1 2013. Please click here to nominate your product/firm.

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