An insurer has introduced a new single-premium equity indexed annuity.
The Wellesley, Mass., U.S. arm of Sun Life Financial Inc., Toronto, says the new SunDex Advantage includes a Lifetime Benefit feature that can be activated by any holder after age 60.
The feature can provide lifetime income for holders with depleted account value, as long as the value is at least $12,500, Sun Life says.
The amount of income is based on a withdrawal amount that can range from 5% to 7.5% of the account value depending on the age of the covered individual at the time the Lifetime Benefit feature is activated.
The holder pays for the feature through an adjustment in the holder’s share of any increase in the S&P 500 index.
The Sun Life unit that issues the annuity is responsible for backing the feature guarantees.
SunDex Advantage interest credits are based on positive changes of the S&P 500 index. The changes are averaged over 12 months during a client’s contract year and reset annually, Sun Life says.
The issuing insurer guarantees that holders will earn a minimum rate of 1.75% on their premium contributions.
Clients can begin taking withdrawals of the guaranteed portion beginning at age 60 without annuitizing, Sun Life says.