National Western Life’s Benefit assurance is a fixed annuity that has a one year fixed rate and a 14-year surrender charge period. The annuity is a flexible premium deferred fixed annuity. The product offers a 5% bonus on premiums that are received in the first year of the contract. The first year has a guaranteed first year interest of 1.95% and a premium bonus of 5%. These add up to a guaranteed 7.0475% total interest rate for the first year of the contract. After the first year, the annuity’s rate of interest will be renewed for subsequent years and is guaranteed to never fall below 1.00%.
The premium bonus rates are 5%, 4.00%, 4.00%, 4.00% and 4.00% for year 1 through 5.
NWL Benefit Assurance Features
Minimum and maximum premiums
The minimum single premium for this annuity is $5,000 for non-qualified persons and $2,000 for qualified persons. The maximum single premium is $1,500,000. Flexible premiums are allowed with the NWL Benefit Assurance Annuity over the entire product life. There is also the possibility of a payroll deduction up to $100 and a minimum added premium of $100.
The annuity does not provide for market value adjustment but provides a free 20 day lookup period and a 45 day rate lock protection period. This may however vary by state.
Issue age
The NWL Benefit Assurance annuity is issued to people aged between 0-85 years for the policy owner. Annuitants have an age restriction band ranging between 0 and 85 years. The age restriction for annuitization stands at 95 years. Several states have slight differences.
Free withdrawals
This annuity allows policy holders to make 1 free withdrawal per policy year each limited to a maximum 10% the value of the annuity. The withdrawal is based on accumulation. Holders can also withdraw the interest amount only if they wish to. This is however only available after 1 year.
Above the 10% free withdrawal amount, additional withdrawals will be charged for early withdrawals. The charges start at 19.25% for the first years and reduce gradually as follows: 16.00%, 16.00%, 15.75%, 15.00%, 14.00%, 13.25%, 12.50% and 11.50%, 10.75%, 10.00%, 8.00%, 6.00%, 4.00% and 2.00% for the fourteenth year. The minimum amount for the free withdrawal is $500 and the account must remain with at least $2,000. Slight differences apply with specific states.
Loan provision
From the second month of the contract, a policy loan may be taken for a minimum of $500 and up to 60% of the accumulation account. For the loan, each repayment must be at least $25.
Annuitization
The annuitization option is not available in all states. Annuitants have three annuitization options available to them. These are period certain payments, lifetime income equal payments and lifetime income as long as the joint owners live. A guaranteed 1.25% rate of interest will be used to calculate payments.
Systematic withdrawals
Systematic withdrawals are available with the NWL Benefit Assurance annuity. These can only be done on a monthly, quarterly, semi-annual, or annual basis. The minimum amount that can be withdrawn is $100 while the minimum account value is $2,000.
Death benefit
The death benefit will be paid to the named beneficiary. If the death occurs before the maturity date, the beneficiary receives a lump sum of the accumulated amount or as they may elect under one of the settlement options. The benefit could pass without any delays and probate costs.
State specific
This product was not available in AK AL CT DE IL IN MA MN MS NJ NV NY OR PA SC UT WA as of March 1, 2017. In addition to these, hospitalization and nursing home waivers are not available in PR and TX.
