AB All Market Index℠ Capitalizes on Dynamically Allocated, Momentum-Driven Approach to Help Deliver Stable Growth in the Power Select Index Annuities
NEW YORK, January 22, 2020 — AIG Life & Retirement, a division of American International Group, Inc. (NYSE: AIG) and a leading provider of annuities[i], today announced the launch of the new AB All Market Index. This multi-asset index has been developed exclusively for AIG’s Power Select Index Annuities by AllianceBernstein (AB) and will be distributed primarily through Market Synergy Group (MSG).
The AB All Market Index may help consumers in changing markets by balancing growth equity and defensive fixed income assets. Like all indexes in an index annuity, the AB All Market Index is not available for direct investment, but its performance is used to help determine the interest earned in the annuity.
The AB All Market Index seeks to stabilize returns through a systematic allocation process based on risk and momentum. First, a strategic allocation is constructed, balancing risk equally among the Index’s growth and defensive assets worldwide. The Index then uses a proprietary momentum strategy to dynamically adjust exposures, overweighting assets that are trending up and underweighting those with poor performance. The Index’s unique approach blends three different momentum signals to better capture the movement of assets.
Asset classes not commonly found in most index strategies
“We are excited to offer consumers a new index that combines AllianceBernstein’s global asset management expertise with our tradition of annuity innovation and design,” said Bryan Pinsky, Senior Vice President of Individual Retirement Pricing and Product Development at AIG. “By using asset classes not commonly found in most index strategies, such as currency-hedged global bonds, and combining them with a dynamic allocation across ten U.S. equity sectors, this new index has the potential to generate solid risk-adjusted performance.”
“With the AB All Market Index, consumers have an opportunity to increase their portfolio diversification, while also benefitting from a dynamic momentum strategy that can adapt to changing market conditions,” said Stuart Davies, CFA, Co-Head of the AB Custom Alternative Solutions team for AllianceBernstein. “The Index is constructed using tools and processes that are robust and well-tested. Additionally, the design and mechanics of the Index give it the flexibility needed to help deliver results in all types of markets.”
Expands the breadth of asset classes
“Market Synergy Group looks forward to offering the AB All Market Index exclusively through the Power Select Index Annuities,” said Lance Sparks, President, Market Synergy Group. “The Index expands the breadth of asset classes available to our clients and offers more choice and flexibility in building a portfolio that can help meet their changing needs.”
In addition to the AB All Market Index, AIG has introduced a new enhanced income benefit in its Power Select Plus Income® Index Annuity. Also known as a confinement rider, this enhancement allows consumers to receive up to 200% of their maximum annual withdrawal amount if they are confined to a qualified facility, such as a nursing home, for at least 90 days. The new confinement rider is automatically included with all guaranteed living benefit riders for no additional fee and can last for five years or until the depletion of the contract value, if sooner. The enhanced income has no negative impact on the riders’ benefits; however, other restrictions and limitations apply.
The AB All Market Index is available exclusively in the Power Select Index Annuities issued by American General Life Insurance Company, a member company of AIG. The Power Select Index Annuities combine tax deferral, principal protection against down markets, growth potential through a diverse range of index interest accounts, and guaranteed lifetime income options to help consumers prepare for retirement. Guarantees are backed by the claim-paying ability of the issuing insurer.