Nationwide has introduced an indexed annuity that’s filed the U.S. Securities and Exchange Commission as a variable product.
The Columbus, Ohio-based insurer says the new Nationwide Defined Protection Annuity (DPA) contract will give purchasers the ability to decide how much protection Nationwide provides against market losses.
When an insurer sells a non-variable indexed annuity, it must promise to protect the annuity holder against any loss of account value that occurs due to investment market ups and downs.
When an insurer structures an indexed annuity as a variable annuity contract, and registers the contract with the U.S. Securities and Exchange Commission, it can expose the annuity holder to the risk of loss of account value.
A consumer who buys the variable Nationwide DPA contract can decide whether the contract will protect account value against 90%, 95% or 100% of market-related losses.
The new Nationwide contract also offers consumers a menu of crediting rate options linked to a variety of investment indices, including the S&P 500 Index, the MSCI EAFE index, the NYSE Zebra Edge Index, and the J.P. Morgan Mozaic II Index, according to Nationwide.
Nationwide is writing the new annuity through Nationwide Life Insurance Company of Columbus. Nationwide Life is responsible for making good on the contract guarantees.