A large insurer is offering a new guaranteed minimum withdrawal benefit with one of its variable annuity families.
The Wellesley Hills, Mass., U.S. division of Sun Life Financial Inc., Toronto, says the Retirement Income Escalator rider gives clients the ability to defer income from the company’s Financial Masters VA contracts and to receive an annual bonus later.
Buyers of the VA contract can receive up to 7% to the withdrawal benefit base for the first 10 contract years if no withdrawals are taken in that period, according to Sun Life.
Under the rider, the older the customer is at the time of their first withdrawal, the higher their withdrawal percentage becomes. For instance, those ages 59.5 to 69 receive an annual withdrawal amount equal to 5% of their withdrawal benefit base, and the amount increases to 6% for those ages 70 to 79 and 7% for ages 80 and up, Sun Life says.