Presidential Life Insurance Company

Transcription

1 Presidential Life Insurance Cmpany INCOME & LEGACY ANNUITY (Agent Guide) SINGLE PREMIUM IMMEDIATE ANNUITY (SPIA) Jint Survivr Limited Payment Incme Cntract

2 The Presidential Life Stry Presidential Life Insurance Cmpany f Nyack, New Yrk was funded in 1965 as a small reginal carrier and has since grwn int a natinal leader f niche annuity cntract and life insurance plicy issuers, perating in 49 States and the District f Clumbia. All ur prducts, bth annuity and life, are simple and straight frward. With apprximately $3.6 billin f assets we are financially strng and ne f, if nt the nly, debt free life insurance cmpany in the United States. Table f Cntents Intrductin Our Design (cncept) Nrmally tw annuitants reduce SPIA payment pricing but When Primary Annuitant Dies Secndary Annuitant Pre-Deceases the Primary Annuitant Advantages Target Markets Annuitant Age Limitatins Annuitant May Nt Be Changed After Cntract Issue Date Indicate Annuitant Relatinship t One Anther Secndary Annuitant Payment Perid Duratins Payment Mdes Maximum Premium Nn-Qualified and Qualified Premium Cmmissin Sample Immediate Annuity Applicatin frm Sample Acknwledgement f Annuity Purchase frm Sample f Annuity Purchase Suitability frm Sample f Custmer Identificatin Prgram (CIP) frm Sample f JT 100% Survivr Qute

3 Incme & Legacy Annuity Jint Survivr Limited Payment Incme Cntract A Whle New Single Premium Immediate Annuity (SPIA) Cncept Intrductin Presidential Life, the innvatr in SPIA design, intrduces anther nvel fixed immediate annuity incme cntract. Retirees crushed by equity markets are facing staggering financial lsses. Smart SPIA designs are needed t help retirees recver their incmes while simultaneusly helping them t maintain sme legacy bequests t individuals they want t benefit frm their remaining estates. Many agents are familiar with the mst cmmn and ppular frms f SPIAs; perid certain and single life and installment refund cntracts. These cntracts prvide a single lifetime incme with a chance that sme incme might be paid t the cntract Beneficiary shuld the Annuitant die within the perid certain duratin. Hwever, since n ne knws when the Annuitant might die, yu can never knw what if anything; their Beneficiary is ging t receive. In an attempt t deal with the Annuitants unknwn date f death, and t prvide a legacy benefit ptential, agents tend t recmmend annuity cntracts featuring lng perid certain duratins with the hpe that, the Beneficiary will cllect sme amunt. Hwever, the elngatin f the perid certain duratin reduces the cntract s incme. Our Design Tw Annuitants (Primary & Secndary) rather than ne Annuitant and a Beneficiary. This arrangement better assures the Annuitant needed incme while simultaneusly managing fr a better legacy expectatin fr the Secndary Annuitant. The payments t the Secndary Annuitant start after the Primary Annuitant dies, whenever that might be. Nrmally tw annuitants reduce SPIA payment pricing. But instead Unreduced payments t the Primary Annuitant s surviving Secndary annuitant are limited t a pre-selected number f years (5-20), at the time f applicatin. Increased verall annuity payments t bth Annuitants versus traditinal JT & Survivr cntracts and fixes an expected benefit t the Primary Annuitant s surviving Secndary Annuitant. By changing the frmer Beneficiary int a Secndary Annuitant, we effectively underwrite the Beneficiary fr SPIA pricing purpses. When the Primary Annuitant Dies The secndary Annuitant (the frmer Beneficiary f a perid certain and single life r installment refund annuity) begins t receive an equal payment amunt fr a pre-determined number f years (5 20) elected n the applicatin. The Secndary Annuitant cntinues t cllect the incme ver these years until the cmpletin f the elected duratin years r until his/her death whichever ccurs first. Secndary Annuitant Dies Befre the Primary Annuitant The Primary Annuitant cntinues t receive a lifetime incme amunt fr his/her entire life. 3

4 Advantages Remves The Guess Wrk Regarding Hw Much Will Be Paid When The Primary Annuitant Dies. The Secndary Annuitant starts t receive a payment when the Primary Annuitant dies, n matter when the Primary Annuitant dies. Return f Premium at Primary Annuitant Death. Example: Fr $100,000 premium, the mnthly payment is $600*, the Secndary Annuitant receives the same payment fr the perid elected n the applicatin. If that perid was 10 years, the ttal payment amunt is $600 x 120 mnths = $72,000, r 72% f the premium cst. Secndary Annuitant needs t survive during this 10 year perid t cllect the entire $72,000. *Hypthetical annuity pricing fr discussin purpses nly. Actual pricing based n Annuitants age, gender, and duratin f Secndary Annuitant payments, alng with annuity rates at the time f cntract purchase. The Primary Annuitant may wish instead t prvide a return f premium cst fr the benefit f his/her Secndary Annuitant. In this case, the number f years (up t a maximum f 20 years) is selected in rder t accmmdate this request. Using the same $100,000 example, the mnthly payment may be reduced t $416.67* but the number f years is extended t 20. The ttal payment amunt is $100,000 ($ x 240 mnths) and equals 100% f the premium cst. Secndary Annuitant needs t survive during this 20 year perid t cllect the entire $100,000. The Primary Annuitant can determine mre clearly, at the time the cntract is purchased, just what amunt f his r her premium cst will be paid, ver the selected duratin, t the Secndary Annuitant. Life cntingent payments ffer superir safety ver perid certain annuity payments and ther financial prducts. Bth the Annuitants benefit frm the superir safety f life cntingent, annuity payments versus perid certain annuity payments. Life cntingent payments, unlike perid certain payments, help assure Annuitants receive the payments that they bargained fr because life cntingent payments have little r n value t third parties. This cntract is irrevcable, payments are nn-cmmutable, and it has n cash surrender value, further prtecting Annuitants incme, unlike ther financial prducts. Target Markets All perid Certain and Single Life r installment refund cases when Annuitant incme and legacy benefits are f equal imprtance in the incme equatin Spuses (ages 80+) Father/Mther Adult Children Grandfather/Grandmther Adult Grandchildren (minimum age 21) Siblings Significant thers (must have insurable interest) Annuitants Age Limitatins (age nearest birthday) Maximum Issue Age 90 Minimum Issue Age 21 4

5 Annuitants May Nt Be Changed After Cntract Issue Date Indicate Annuitant Relatinship t One Anther Spusal Parent/Child Siblings Other (must have insurable interest) Secndary Annuitant Payment Perid Duratins 5 20 years (May nt be changed after cntract issue date) Payment Mdes Mnthly, Quarterly, Semi-annual, Annual (Mdes may nt be changed after issue date) (Payment must start within 1 mde f annuity issue date) Cmmissins Full Nrmal SPIA cmmissins (see yur General Agent) Unreduced fr age N Cmmissin Charge Backs n Any Annuitant Death This cntract is irrevcable, payments are nn-cmmutable, and it has n cash surrender value. Cntract Frm SPIA(90) Nt FDIC insured. Any tax suggestins are merely ur understanding f the IRS cde. Presidential Life Insurance Cmpany is nt a tax and/r legal advisr. Infrmatin in this brchure is nt intended as tax and/r legal advice. Please cnsult yur tax and/r legal cunsel fr prfessinal guidance regarding all Federal and State laws befre making any financial decisins. Maximum Premium $1 millin (withut Hme Office prir apprval) Nn-Qualified Premium Qualified Premium Must pass the IRS Required Minimum Distributin (RMD) test fr annuity cntracts May require a reductin f the number f years in the duratin f the Secndary Annuitant Payment Phne Hme Office fr details An Illustratin Must Accmpany Applicatin t Issue Cntract Suitability On the suitability frm. I elect t cmplete the annuity suitability questinaire Must be checked ff n the frm fr the JT Survivr Limited Pay prduct. 5

6 Sample: Hw t cmplete a JT Applicatin, page Use state apprpriate frm 1. Primary Annuitant Name and Their Relatinship t The Secndary Annuitant. 2. Secndary Jint Annuitant Name and Their Relatinship t The Primary Annuitant. 3. (Years) Payable t The Secndary Annuitant (Temprary Life). 4. Primary Annuitant/Owner Indicates Reasn fr Purchase and Initials. 6

7 Sample: Sample: Hw t cmplete a JT Applicatin, page JT 100% Survivr Limited Payment, 10-years temprary life N Beneficiary Must Be Written Here. 6. JT 100% Survivr Limited Payment, 10-Years Temprary Life - Write in The Remarks Sectin. 7. Primary Annuitant/Owner Signs Here. 7

8 Sample: Acknwledgement f Annuity Purchase Jhn & Mary De (Bth f the Annuitants). 9. Years Payable t the Secndary Annuitant (Temprary Life). 10. Primary Reasn t Purchase Cntract. 8

9 Sample: Annuity Purchase Suitability I elect t cmplete the annuity suitability questinaire MUST be checked ff n this frm. 12. General Rule: The Premium Cst Shuld Nt Exceed 50% f the Liquid Net Wrth Amunt. Cntact Hme Office if Yur Case is Different. 13. General Rule: The Annual Annuity Incme Purchased Shuld Nt Exceed 50% f the Ttal Annual Incme. Cntact Hme Office if Yur Case is Different. 14. Objectives Must be Cmpleted. 9

10 Sample: Custmer Identificatin Prgram (CIP) Primary Annuitant/Owner Name Here. 16. Cmplete in Detail (see example). 17. Cmplete fr Bth Annuitants. 18. Agent Only Signs Frm. 10

11 Sample: JT Survivr Limited Pay Qute 11

12 JTSurvLtdPay-Agent_ Presidential Life Insurance Cmpany In Texas ding business as Rckland Life Insurance Cmpany Nyack, New Yrk r PRES LIF