Aviva USA (Aviva), a unit of Aviva plc, announced their new Target Benefit series of annuities this week.
The series of annuities are designed to offer consumers both simplicity and flexibility, two qualities that are often elusive in the annuity market.
Aviva concluded that many consumers were yearning for a level of certainty in their retirement vehicles after the market volatility of the last few years.
The Target Benefit series offers an array of options to meet various retirement needs from wealth accumulation to guaranteed lifetime income.
Aviva touts the product as groundbreaking because it offers a statement of benefits (the first of its kind for the annuity industry) where a simple explanation of the monthly dollar amount the customer will receive when they start drawing guaranteed lifetime income, no matter how the market fluctuates.
The Target Benefit series also offers two optional income riders that allow increased flexibility for customers to decide at what age they want to begin receiving their income. Customers are also able to choose either a fixed lifetime income benefit or a lower guarantee with the opportunity to participate in more market index upside.
Contracts, which are available with either 10- or 15-year withdrawal charge periods, are the simplest Aviva has issued. The amount of the guaranteed lifetime income is based only on the amount of premium, the customer’s age and the amount of time they want to wait before they begin lifetime income benefits. There are no separate income account value or withdrawal percentages to calculate.