MassMutual VA Lets Owners Make Switches Inside The Contract
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“Consumers dont want to be locked into a product forever,” contends David OLeary, senior vice president, annuity business, at Massachusetts Mutual Life Insurance Company, Hartford, Conn.
“They do want a long-term relationship with their insurer and with their product,” he adds, “but they want to have it in a product that allows changes as their needs change.”
That was one of the key findings that came from research and focus groups MassMutual conducted with consumers, he says.
The finding was so compelling that he says the insurer redesigned its variable annuity strategy around it. The resulting product–MassMutual Transitions VA–offers three “package” plan options (I, II, and III) and also a completely unbundled option (Custom).
No matter which plan the buyer selects, OLeary says, the person has choice in features.
In addition, after policy issue, owners can change certain features of the Custom plan and, if in a Package plan, can make “switches” between Packages I, II, and III right inside the contract. They can do these Package switches starting on the 2nd anniversary and every year thereafter. (But they cant switch between Package plans and Custom.)
“Our focus groups indicated consumers are looking for a product that helps them grow their money, live their lives, and protect their money,” says OLeary. So the designers structured Transitions–and its marketing materials–to facilitate all three.
For instance, the “grow your money” features include the products multiple investment options, and its asset allocation program. The investment options include: 39 subaccounts handled by 15 money mangers, three dollar cost averaging fixed accounts (six-, 12-, and 18-months), and four guaranteed fixed accounts (three-, five-, seven-, and 10-year periods).
The “live your life” features include various penalty-free withdrawal features (depending on plan selected); a nursing home waiver (in Packages II and III and in Custom as an option); and several guaranteed income options (including fixed, variable, and combination).
Further, as indicated above, Transitions lets “owners change certain benefit selections or make transfers between Packages, when needs change,” says OLeary. This way, “we help people transition between the stages in their lives,” he says, indicating thats why the insurer chose Transitions as the name of the policy.
The “protect your money” features include a guaranteed minimum accumulation benefit, a guaranteed minimum income benefit, six death benefit features, an earnings enhancement benefit, and “equalizer” (an earnings credit after year 10 and every five years thereafter).