Allianz Life Introduces New Excess Return Indexes
September 19, 2018 by Allianz Life Insurance Company of North America
MINNEAPOLIS, Minnesota, Sept. 18 — Allianz Life, a provider of retirement solutions, including fixed and variable annuities and life insurance for individuals, issued the following news release:
To help offer clients the opportunity for a level of stability in rates and flexibility amid market volatility and changing short-term interest rates, Allianz Life Insurance Company of North America (Allianz Life(R)) has announced three new index allocation options for select life insurance and fixed index annuity (FIA) products: Bloomberg US Dynamic Balance II ER Index and PIMCO Tactical Balanced ER Index, and for select FIA products BlackRock iBLD Claria ER Index.
The new index allocation options will track the price of futures, which reflect the expected future value of an index and account for expected dividends. This will help financial professionals better address the effects of changing short-term interest rates for the associated crediting methods and can help foster more consistent renewal rates throughout the life of a policy or contract.
“Given the current economic environment, clients want solutions that can offer growth potential while mitigating the impact of rising short-term interest rates,” said Tom Burns, chief distribution officer, Allianz Life. “This opportunity for a level of stability in renewal rates may be what many clients need and are looking for right now.”
The new indexes are available through annual point-to-point with a participation rate crediting method. The annual point-to-point with a cap and annual point-to-point with a spread crediting methods will continue to be available on current indexes (spread only on FIA products). With three familiar index names, the fundamental goal of each new index remains the same:
Bloomberg US Dynamic Balance II ER Index is designed to dynamically manage volatility and is available for select life insurance and FIA products.
PIMCO Tactical Balanced ER Index is designed to manage volatility with protection against rising rates and is available for select life insurance and FIA products.
BlackRock iBLD Claria ER Index is designed to manage volatility with a forward-looking annual adjustment and is available for select FIA products.
Although an external index may affect interest credited, the contract/policy does not directly participate in any equity or fixed income investments. A client is not buying shares in an index.
All three of these indexes can be added to select new FIA contracts; the Bloomberg US Dynamic Balance II ER Index can be added as an option to select inforce FIA contracts later this year for clients who currently have Bloomberg US Dynamic Balance Index or Bloomberg US Dynamic Balance II Index as an allocation option on their contract. For life insurance products, the Bloomberg US Dynamic Balance II ER Index and PIMCO Tactical Balanced ER Index can be added as an option to select new policies and to inforce policies on the first policy anniversary.
For important product information and index disclosure, please click here (https://www.allianzlife.com/annuities/fixed-index-annuities) for fixed index annuities, and here (https://www.allianzlife.com/life-insurance/fixed-index-universal-life) for fixed index universal life insurance.
The indexes available within the insurance product are constructed to keep track of diverse segments of the U.S. or international markets, or specific market sectors. These indexes are benchmarks only. Indexes can have different constituents and weighting methodologies. Some indexes have multiple versions that can weight components or may track the impact of dividends differently. Although an index may affect your interest credited, you cannot buy, directly participate in or receive dividend payments from any of them through the insurance product.
Guarantees are backed by the financial strength and claims-paying ability of the issuing company.
Products are issued by Allianz Life Insurance Company of North America.
Product and feature availability may vary by state and broker/dealer.
Allianz Life Insurance Company of North America offers insurance and annuities in all states except New York, where it is not authorized to do so. In New York, products are issued by Allianz Life Insurance Company of New York.