The U.S. Patent and Trademark Office has awarded a patent that will protect a technique a large insurer is using to calculate crediting rates for deferred fixed annuities.

Life insurance units of Allstate Corp., Northbrook, Ill., started issuing one of the annuities, the Allstate Treasury-Linked Annuity contract, in 2002, and the Allstate Treasury-Linked Annuity Plus contract, a similar contract that includes a market valuation adjustment feature, in 2003.

Both annuities use a crediting formula that ties increases in the crediting rate to increases in the U.S. Treasury Note Constant Maturity 5-year rate.

When the 5-year rate falls, consumers who follow contract rules and leave sufficient assets in the annuity for a predetermined length of time will receive a guaranteed interest rate, Allstate says.

The Allstate life subsidiaries that issue the annuities are responsible for backing the product guarantees.

The patent now protecting the Treasury-Linked contract crediting rate method is U.S. Patent 7,080,032, Allstate says.