A large life insurer has rolled out a new version of a variable annuity feature that can protect VA investment earnings along with VA premium payments.[@@]
The insurer, Massachusetts Mutual Life Insurance Company, Springfield, Mass., says it will be offering an updated guaranteed minimum accumulation benefit feature designed for purchasers of the MassMutual Transitions Select variable annuity contract.
In most states, customers can choose a 10-year or a 20-year GMAB feature when they buy the annuity.
The 10-year feature lets investors purchase payments made during the first 2 contract years. Purchasers also can exercise a “reset” feature starting on the second contract anniversary. The reset feature can lock in any growth accumulated as of the reset date for another 10 years, MassMutual says.
MassMutual is responsible for backing the annuity and the GMAB feature.
The 20-year version of the feature does not come with a reset feature, but it guarantees that MassMutual will double the value of purchase payments made during the first 2 contract years after 20 years, MassMutual says.
The cost of the 10-year and 20-year GMAB feature is 0.35% of assets per year, up to a maximum of 1% of assets.
To qualify to buy a GMAB feature, an investor must invest through a “directed allocation model” program that will take charge of choosing investments and allocating assets, MassMutual says.