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Life Health > Life Insurance

AXA Equitable Offers Teachers Asset Allocation With a 10% Market Drop Buffer

By Allison Bell

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AXA Equitable Life is offering teachers a new asset allocation strategy that comes with what amounts to a buffer annuity feature inside their 403(b) retirement plans.

(Related: AXA Equitable Posts Strong Buffer Annuity Sales)p

The company’s new Semester Strategies asset-allocation feature can protect a user against a loss of up to 10% in the value of the buffered assets.

AXA Equitable Life — an arm of AXA Equitable Holdings Inc. — has been an active player in the 403(b) plan market, which offers educators access to retirement accounts that resemble 401(k) plan accounts.

AXA Equitable Life is starting by having the new asset-allocation feature bolt on to the AXA Equitable Equi-Vest group variable annuity contract. That contract is aimed at 403(b) plans at elementary schools, middle schools and high schools.

AXA Equitable Life is also planning to make the program available with its other group variable annuity contracts.

An outside investment advisor, SWBC Investment Advisory Services, has created the model portfolios for the program and will provide fiduciary oversight for the program, AXA Equitable Life says.

Managers will shift the assets entrusted to the program toward more conservative investments as the teacher participant nears retirement.

AXA Equitable Life notes that the market drop buffer included with the program limits the company’s own exposure to market volatility, by having the company protect the user against only a specified level of losses. The feature does not guarantee a minimum rate of return, or protect the user against any market losses. In a severe downturn, the user could lose principal, according to AXA Equitable Life.

The company says the new program comes with its own restrictions and limits, such as a rule that would keep a teacher now using the Equi-Vest contract Personal Income Benefit feature from switching to the Semester Strategies program.

— Read  Savings Plans Shortchange Public-School Teachers, on ThinkAdvisor.

— Connect with ThinkAdvisor Life/Health on LinkedIn and Twitter.

Allison Bell

Think_Allison

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NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.