Managing Expectations and Emotions

TYPE OF
GUARANTEE
VALUE IN UP MARKETS
CLARITY
PROS AND CONS
VALUE IN DOWN MARKETS
CLARITY
PROS AND CONS
OTHER
CONSIDERATIONS
TYPICAL COST

Fixed Annuity

Fixed rate of return is easy to explain, regardless of market conditions
Fixed rate can fall far short of market performance, although some contracts may offer higher reset at end of guarantee period
Fixed rate of return is easy to explain, regardless of market conditions
Steady growth rate provides comfort during times of market loss, but guarantee could be reset to lower rate at end of guarantee period
Minimum guarantee after  end of period is often low; some contracts assess market value adjustment (MVA) on withdrawals
No explicit fees

Index Annuity

Cap rate concept is easy to explain, but variations in interest-crediting strategy may add complexity
Lower caps typical for these products can limit growth in strong markets and cause frustration
Standard 0% floor design protects principal, but minimum guarantees which apply only if held for a set term can create confusion
Principal protection is highly attractive in times of market loss, and minimum guarantee may add further value if held to end of period
Contracts typically assess market value adjustment (MVA) on withdrawals; renewal rate history may be volatile
No explicit fees

Index-Linked Annuity with Buffer

Cap rate and participation rate concepts are easy to explain, but complex combination of choices for interest-crediting strategy may add confusion around upside potential
Higher caps and participation rates canoffer stronger growth potential than traditional index annuities, but returns may not lock in unless held to end of period
Chosen downside buffer provides comfort, but may be confused with true limit on loss
Buffer minimizes loss, but downside remains unknown and could be significant
Contracts typically assess market value adjustment (MVA) on withdrawals, and formula may be highly complex; renewal rate history may be volatile
May or may not have explicit fees

Index-Linked Annuity with Floor

Cap rate concept is easy to explain, and interest-crediting follows straightforward annual “point-to-point” approach
Higher caps than traditional index annuities can offer stronger growth potential, and returns are locked in annually
Chosen floor provides confidence of clear downside protection
Floor can be customized to desired level of protection, and reset annually based on changing needs
Contracts typically assess market value adjustment (MVA) on withdrawals, and formula may be highly complex; renewal rate history may be volatile
May or may not have explicit fees
1Asset 1

Look closer at the power of risk control

Variable Annuity

No guarantees related to upside potential
Selected investment options receive full market participation
No guarantees related to downside protection
Selected investment options receive full exposure to market loss
Range of variable accounts may add complexity, but also adds flexibility and customization
Contract fee plus average fund fees typically runs between 2.20% and 2.50%

Annuities with Living Benefits

No account value upside guarantees; rules for excess withdrawals and step-up and roll-up rates add complexity and can cause confusion between benefit base and account value
Index and variable accounts participate in market growth, but living benefit rider may restrict available options and many variable funds include volatility controls which can further limit growth potential
May or may not have account value downside guarantees; ability to turn on lifetime withdrawals is simple to explain as protection against “worst-case scenario,” but rules for interest-crediting, excess withdrawals and step-up and roll-up rates add complexity and can cause confusion between benefit base and account value
Variable accounts receive full exposure to market loss; comfort of lifetime withdrawals can be powerful, but may end up delivering less value for those seeking accumulation rather than income guarantees
Living benefit payout rates for new sales can vary based on market conditions
Living benefit riders average 1.05% – 1.20% annually depending on the type of annuity; may also have other fees associated with the contract or variable funds

Fixed Annuity

VALUE IN UP MARKETS
CLARITY
PROS AND CONS
Fixed rate of return is easy to explain, regardless of market conditions
Fixed rate can fall far short of market performance, although some contracts may offer higher reset at end of guarantee period
VALUE IN DOWN MARKETS
CLARITY
PROS AND CONS
Fixed rate of return is easy to explain, regardless of market conditions
Steady growth rate provides comfort during times of market loss, but guarantee could be reset to lower rate at end of guarantee period
OTHER
CONSIDERATIONS
TYPICAL COST
Minimum guarantee after  end of period is often low; some contracts assess market value adjustment (MVA) on withdrawals
No explicit fees

Index Annuity

VALUE IN UP MARKETS
CLARITY
PROS AND CONS
Cap rate concept is easy to explain, but variations in interest-crediting strategy may add complexity
Lower caps typical for these products can limit growth in strong markets and cause frustration
VALUE IN DOWN MARKETS
CLARITY
PROS AND CONS
Standard 0% floor design protects principal, but minimum guarantees which apply only if held for a set term can create confusion
Principal protection is highly attractive in times of market loss, and minimum guarantee may add further value if held to end of period
OTHER
CONSIDERATIONS
TYPICAL COST
Contracts typically assess market value adjustment (MVA) on withdrawals; renewal rate history may be volatile
No explicit fees

Index-Linked Annuity with Buffer

VALUE IN UP MARKETS
CLARITY
PROS AND CONS
Cap rate and participation rate concepts are easy to explain, but complex combination of choices for interest-crediting strategy may add confusion around upside potential
Higher caps and participation rates canoffer stronger growth potential than traditional index annuities, but returns may not lock in unless held to end of period
VALUE IN DOWN MARKETS
CLARITY
PROS AND CONS
Chosen downside buffer provides comfort, but may be confused with true limit on loss
Buffer minimizes loss, but downside remains unknown and could be significant
OTHER
CONSIDERATIONS
TYPICAL COST
Contracts typically assess market value adjustment (MVA) on withdrawals, and formula may be highly complex; renewal rate history may be volatile
May or may not have explicit fees
1Asset 1

Look closer at the power of risk control

Index-Linked Annuity with Floor

VALUE IN UP MARKETS
CLARITY
PROS AND CONS
Cap rate concept is easy to explain, and interest-crediting follows straightforward annual “point-to-point” approach
Higher caps than traditional index annuities can offer stronger growth potential, and returns are locked in annually
VALUE IN DOWN MARKETS
CLARITY
PROS AND CONS
Chosen floor provides confidence of clear downside protection
Floor can be customized to desired level of protection, and reset annually based on changing needs
OTHER
CONSIDERATIONS
TYPICAL COST
Contracts typically assess market value adjustment (MVA) on withdrawals, and formula may be highly complex; renewal rate history may be volatile
May or may not have explicit fees
1Asset 1

Look closer at the power of risk control

Variable Annuity

VALUE IN UP MARKETS
CLARITY
PROS AND CONS
No guarantees related to upside potential
Selected investment options receive full market participation
VALUE IN DOWN MARKETS
CLARITY
PROS AND CONS
No guarantees related to downside protection
Selected investment options receive full exposure to market loss
OTHER
CONSIDERATIONS
TYPICAL COST
Range of variable accounts may add complexity, but also adds flexibility and customization
Contract fee plus average fund fees typically runs between 2.20% and 2.50%

Annuities with Living Benefits

VALUE IN UP MARKETS
CLARITY
PROS AND CONS
No account value upside guarantees; rules for excess withdrawals and step-up and roll-up rates add complexity and can cause confusion between benefit base and account value
Index and variable accounts participate in market growth, but living benefit rider may restrict available options and many variable funds include volatility controls which can further limit growth potential
VALUE IN DOWN MARKETS
CLARITY
PROS AND CONS
May or may not have account value downside guarantees; ability to turn on lifetime withdrawals is simple to explain as protection against “worst-case scenario,” but rules for interest-crediting, excess withdrawals and step-up and roll-up rates add complexity and can cause confusion between benefit base and account value
Variable accounts receive full exposure to market loss; comfort of lifetime withdrawals can be powerful, but may end up delivering less value for those seeking accumulation rather than income guarantees
OTHER
CONSIDERATIONS
TYPICAL COST
Living benefit payout rates for new sales can vary based on market conditions
Living benefit riders average 1.05% – 1.20% annually depending on the type of annuity; may also have other fees associated with the contract or variable funds

FOR REPRESENTATIVE USE ONLY; NOT TO BE SHOWN TO THE GENERAL PUBLIC

CMGA-4462524.1-0322-0424