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New Annuities Use Quarterly Cap Crediting

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RBC Insurance has introduced a collection of 3 equity-indexed annuities.

RBC, Greenville, S.C., says the new RBC Enhanced Choice 8, Choice 10 and Enhanced Choice 12 annuities use “quarterly cap interest crediting.”

Quarterly cap interest crediting is “a hybrid crediting strategy that computes interest based on the sum of 4 capped quarterly results,” according to RBC, a unit of the Royal Bank of Canada, Toronto.

The annuities offers access to 2 indexed accounts linked to the Dow Jones Industrial Average and 1 traditional, non-indexed fixed account.

One of the indexed accounts relies on monthly averaging of rates, and the other uses quarterly cap crediting, RBC says.

The accounts automatically rebalance at each contract anniversary, and clients can reallocate assets annually without restriction, RBC says.

When a holder dies, the beneficiaries will get the full account value or the minimum guarantee value, whichever is greater, RBC says.

RBC is responsible for backing the product guarantees.