RateTrack Annuity offers innovative concept for clients to take advantage of rising rates within a fixed annuity
TOPEKA, Kan., March 28, 2016 — Security Benefit Life Insurance Company today announced the launch of its new RateTrack Annuity designed specifically to allow clients the opportunity to participate automatically in a rising interest rate environment versus being locked into a long-term, uncompetitive rate.
RateTrack is the industry’s first floating rate annuity, a new category of fixed annuities designed to add a component to a client’s portfolio that automatically responds to a rising interest rate environment. The RateTrack Annuity features a unique interest crediting method that, unlike a typical multi-year guarantee annuity, offers an initial competitive interest rate and then the opportunity for higher interest rates over the life of the contract.
“Security Benefit is making good on our commitment to provide financial advisors and their clients with innovative retirement solutions,” said Mike Kiley, CEO of Security Benefit. “The result is our new RateTrack Annuity, an ideal vehicle for many retirement savers. RateTrack offers a competitive fixed rate of interest today, along with the opportunity to receive a higher rate in future years without the risk to principal that consumers face with other fixed income investments.”
Three Key Concepts
RateTrack is built on three key concepts. First, its design offers a competitive first year rate similar to many other fixed investments and other multi-year guarantee annuities. Second, unlike most other fixed annuities, if interest rates increase in subsequent years, RateTrack rates automatically adjust higher. And third, it offers a guaranteed minimum rate, which protects principal value as interest rates rise, unlike fixed income investments that often have an inverse relationship to rising interest rates.
RateTrack Annuity is a single premium deferred fixed annuity that offers policyholders a guaranteed fixed interest rate in combination with a floating rate pegged to the 3 Month ICE LIBOR USD Rate that may increase during the term of the contract. Contract owners receive a guaranteed base rate of interest that is set for the contract’s Guarantee Period, plus the 3 Month ICE LIBOR USD Rate (subject to a cap), which resets annually on the contract anniversary date.
Over the past 30 years, U.S. interest rates have been on a steady decline and have remained at all-time lows, close to zero, since 2009. In December, the Federal Reserve made its first rate hike for short-term rates in nearly 10 years.
“Low interest rates have had the greatest impact on savers and retirees,” said Dave Byrnes, Vice President and National Sales Director for Security Benefit. “We’ve pioneered a new category of fixed annuities to help clients move off the sidelines and receive a competitive rate today without sacrificing the opportunity to benefit in the likelihood rates continue to rise over the next few years.”
Security Benefit continues to anticipate the needs of advisors and their clients by developing an innovative new class of fixed annuities designed for the investment uncertainty that is likely to accompany rising rates. Bringing RateTrack Annuity to the market is the next step in the evolution of the company’s product set and builds on its successes in the annuity market with the Total Value Annuity and Secure Income Annuity, as well as in the investment-oriented variable annuity space with its EliteDesigns product suite.
Advisors can visit www.securitybenefit.com to learn more about the RateTrack Annuity, the industry’s first floating rate annuity.
About Security Benefit
Security Benefit Life Insurance Company, a 124-year-old, Kansas-based insurance company with more than $30 billion in assets under management, is a leading retirement savings and income solutions provider. Through a combination of innovative products, exceptional investment management and a unique distribution strategy, Security Benefit is a leader in a full range of retirement markets and wealth segments. To learn more about Security Benefit, visit www.securitybenefit.com.