Choice 10 is one of the more popular fixed index annuities from American Equity. Basically, this product is designed to help protect clients’ hard-earned money from index fluctuations while at the same offering interest-growth opportunities that are based on index increases. This annuity product is very similar to the Choice 6 and Choice 8, with the main difference being that it has a longer surrender charge schedule (10 years) compared to the other 2 (Choice 6 has 6 years while Choice 8 has 8 years).
Annuity features
- Penalty-free withdrawals – after the first contract year, a 5% penalty-free withdrawal is allowed provided MVA (Market Value Adjustment) was selected at issue. If the MVA was not chosen, the effective penalty-free withdrawal rate is 10% of your Contract Value.
- Market value adjustment (MVA) – just like with the Choice 6 and Choice 8, this annuity product has an optional MVA rider, which might increase or decrease the withdrawable amount in excess of the surrender value or penalty-free threshold. Policies with an MVP rider tend to have higher interest rates.
- Qualified care needs – two quality care needs riders are automatically given for all policy holders below the age of 75 at issue.
- NCR-100 – the Nursing Care Rider allows the annuitant to get a 100% penalty-free withdrawal if they’re confined to a nursing center for more than 90 consecutive days after the third contract year. If confinement is within the second or third contract years, then a 20% penalty-free withdrawal is allowed.
- TIR -100 – the Terminal Illness Rider allows annuitants to get a 100% penalty-free withdrawal if they’re diagnosed with a terminal disease.
- Death benefit – the death benefit is paid out to selected beneficiaries without any applicable surrender charges.
Surrender values and charges
American Equity Choice 10 Surrender Charge Schedule
| Contract Year | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11+ |
| Surrender Charge Percentage | 9.2 | 8.25 | 7.25 | 6.5 | 5.5 | 4.5 | 3.5 | 2.5 | 1.5 | 0.5 | 0 |
