spectrum choice Bonus product Highlights

Spectrum Choice Bonus Product Highlights
The Spectrum Choice Bonus flexible premium deferred fixed indexed annuity issued by OM Financial Life Insurance Company
features an impressive variety of options designed to meet your clients’ retirement needs. Plus your client is rewarded with a bonus
of 6%* interest in the first year, regardless of which option they choose!
Type
Flexible Premium Deferred Fixed Indexed Annuity
INTEREST CREDITING
Options
u
u
u
u
u
u
Minimum Premium
$10,000 ($2,000 per option)
Maximum Premium
Home office approval is required for premiums in excess of $1,000,000.
Issue Ages
0-85 Non-Qualified; 18-85 Qualified
SIZZLE
Large Premium Limits
Liquidity Riders
u Death of Owner
u Nursing Home
u Terminal Illness
u Unemployment
u Free surrender partial withdrawal after the first policy year of 10% of account value less
prior withdrawals.
MGSV
87.5% of premium, plus daily interest accruing at the MGSV accumulation interest rate, less any
amounts previously surrendered and adjusted for any MGSV reallocation. The interest rate is set at
issue and is fixed for the life of the contract between 1% and 3%, depending on the state of issue.
Withdrawal Charges
Annuity Year
Surrender Charge
(For issue ages 0-80 yrs)
Annuity Year
Surrender Charge
(For issue ages 81-85 yrs)
1-Year, S&P 500®
2-Y­ear, S&P 500®
3-Year, S&P 500®
1-Year, S&P 500®
1-Year, S&P 500®
Fixed Interest
1
2
3
1
2
3
monthly point-to-Point
monthly point-to-Point
monthly point-to-Point
Annual point-to-Point
monthly Average
4
5
6
7
8
9
17.5% 16.5% 15.5% 14.5% 13.5% 12.5% 11.5% 10.5% 9.5%
13.25% 13.25% 13%
4
12%
5
11%
6
10%
7
9%
8
8%
9
7%
10
8.5%
10
6%
11
7.5%
11
5%
12
6.5%
12
4%
13
14
5.5% 4.5%
13
3%
14
2%
Annuitization
u
u
u
u
u
u
u
u
Death Benefit
No surrender charges will be deducted if the owner dies. The surrender value will equal the
sum of the account value of each option surrendered. For indexed options, if the minimum
guaranteed surrender value is greater than the account value, the minimum guaranteed surrender
value will be paid.
Income for a fixed period
Life Income with a Guaranteed Period
Life Income
Joint and Contingent Life Income
Joint and Survivor Life Income with a Guaranteed Period
Joint and Survivor Life Income
Life Income with a Lump Sum Refund at Death
Account value is payable beginning in the 6th year; surrender value is payable in years 1-5.
* Subject to change
For Producer Use Only. ADLF 5287 (03-2005)
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Rev. 05-2007
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Spectrum Choice Bonus Product Highlights
The Advantages Clients Want:
Large Premium Limits - Commission Guidelines
u
Choice of six interest-crediting options.
4 1 Year, S&P 500 monthly point-to-Point
4 2 Year, S&P 500 monthly point-to-Point
4 3 Year, S&P 500 monthly point-to-Point
– Annual, Biennial or Triennial interest crediting with compounding; account value vests according to index crediting option selected.
–Monthly cap is declared and guaranteed for the
index crediting period (subject to a 1% minimum
cap per month).
– Annual, Biennial, or Triennial index credit is never less than zero.
4 1 Year, S&P 500 Annual point-to-Point
4 1 Year, S&P 500 Monthly Average
– Minimum cap for Monthly Average and Annual
Point-to-Point is 3% per year.
– Annual Index Credit is never less than zero.
4 One Fixed Interest Option
– Fixed interest option guarantees a competitive
interest rate for consecutive one-year periods.
•100% participation rate applies to all indexed options.
•Cap rates are determined at the end of the annual, biennial
and, triennial period, depending on the interest crediting
method chosen.
Please refer to the following chart for commission guidelines:
Premium Bonus
All premiums received in the first policy year will receive
additional interest of 6%*, immediately credited to the client’s
account value on the day the premium is received. This
premium bonus applies to all premiums received in the first year
of the policy, regardless of the account value option to which it
is applied. If placed in an indexed option, the additional interest
has the potential to earn index credits.
The Advantages You Want
–
–
–
–
Competitive commissions
Potential to qualify for the Conference of Champions
Full illustration support
Knowledgeable and experienced sales representatives just
a phone call away
– The financial strength and integrity of OM Financial Life
– Large Premium Limits
How Does Spectrum Choice Bonus Work?
Your clients select whether they want interest credited to their
annuity in the form of a fixed interest rate declared annually or
based on a formula linked to changes in the S&P 500®.
If your clients make a full surrender, they will receive the
account value (less surrender charges during the first 14 years) or
the minimum guaranteed surrender value – whichever is greater.
* Subject to change
O m
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Premium
Amount
Commissions
Comp.
Duration
Up to
$1 Million
Full Comp.
N/A
> $1 Million
- $2.5 Million
Choice of 2 Comp. Options:
Reduced Upfront/Trail
or
Level Commission
8 Years
> $2.5 Million
- $5 Million
Level Commission
8 Years
For cases > $1 million to $2.5 million, you have a choice of two
comp. options: 1) Reduced Upfront/Trail, where you will receive
a reduced upfront comp., and the remaining comp. will be
trailed over the comp. duration; 2) Level Commission, where the
comp. will be paid out at the same percentage rate for all years.
For both options, comp. will be paid for the first eight years
ONLY, and all cases over $1 million MUST receive home office
approval. PLEASE NOTE: With the Level Commission option,
the following applies:
• Level commission will be paid based on account value on a
quarterly basis with the 1st payout beginning at the end of the
first quarter after the 1st policy anniversary.
• Level commission will be offered for only a stated period of
time (not for the life of the contract).
• Level commission will only be offered on issue ages
below 80.
• Level commission is only paid to the writing agent.
For cases > $2.5 million to $5 million, only the level
commission option is available.
How the Account Value is Determined Using
Monthly Point-to-Point with a Cap
1. The index value at the end of any given policy month will be
compared to the index value at the beginning of that policy
month to determine the point-to-point index change for
that month.
2. The monthly point-to-point index change is determined by
subtracting the prior month’s index value from the current
month’s index value and dividing it by the prior month’s
index value.
3. If this results in a positive index change and is not more than
the declared cap, it is used as the capped index change for
that month. If the index change is greater than the declared
cap, the cap rate is used as the capped index change for
that month. If the index change is negative, a negative index
change is used for that month. A negative monthly
point-to-point index change is not subject to a cap.
For Producer Use Only.
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Spectrum Choice Bonus Product Highlights
4. At the end of the annual, biennial, or triennial index crediting
period, the positive capped and negative index changes for
each month during the period will be added together.
The sum will be the index credit rate on the index crediting
date. That rate will be multiplied by the option’s account
value to determine the total index credit. If the sum of the
index changes results in a negative value, the index credit
applied will be zero. There will never be a negative index credit.
How the Account Value is Determined Using
Annual Point-to-Point with a Cap
1. The index value on the current year’s anniversary is
compared to the index value on the prior year’s anniversary.
2. The index change is determined by subtracting the prior
anniversary’s index value from the current anniversary’s
index value and dividing it by the prior anniversary’s index
value.
3. If this results in a positive index change and is not more than
the declared cap, it is applied as the index credit rate on the
index crediting date.
4. If the index change is negative, a zero percent credit is
applied. If the index change is greater than the declared cap,
the declared cap rate is used as the index change. The cap is
set at the beginning of each contract year and is guaranteed
for one year.
How the Account Value is Determined Using
Monthly Averaging with a Cap
1. The index average, calculated at the end of the current year,
is determined by averaging the index values, on a monthly
basis, over the current year.
2. The index average for the current year is compared to the
index value on the prior anniversary.
3. The index change is determined by subtracting the prior
anniversary’s index value from the index average and then
dividing it by the prior anniversary’s index value.
4. If this results in a positive index change and is not more than
the declared cap, it is applied as the index credit rate on the
index crediting date.
5. If the index change is negative, a zero percent credit is
applied. If the index change is greater than the declared
cap, the declared cap rate is credited to the account value.
The cap is set at the beginning of each contract year and is
guaranteed for one year.
How the Minimum Guaranteed
Surrender Value is Determined
The Minimum Guaranteed Surrender Value for a full surrender
is 87.5% of premium, plus daily interest accruing at the
MGSV accumulation interest rate, less any amounts previously
surrendered, adjusted for any MGSV reallocation.
The minimum interest rate is set at issue, fixed for the life of the
contract between 1% and 3%, depending on the state of issue.
Fixed Option
For the fixed interest option, interest is credited daily, is declared
in advance, and is guaranteed for one year and will not be less
than the guaranteed minimum effective annual interest rate.
The guaranteed minimum effective annual interest rate is a rate
set at issue and is fixed for the life of the contract between 1%
and 3%, depending on what is approved in the state of issue.
Account Value Reallocation
Money may be moved from one account value option to any
other option as soon as its associated interest crediting period is
complete. In other words, money in the one-year monthly
point-to-point option may be reallocated at the end of the
one-year crediting period, and so on. Money in the fixed
account value option may be be reallocated annually. The
opportunity for account value reallocation always occurs on the
annuity’s anniversary date. If money is moved to a multi-year
option, it must remain there for the duration of the associated
interest crediting period before being reallocated again.
Premiums paid after issue will be placed in the fixed interest
option. Such premium may be reallocated to other options on
the annuity anniversary.
Spectrum Choice Bonus Features-At-A-Glance
Issue Ages
0-85 Non-Qualified; 18-85 Qualified
Ideal Retirement Savings Time Horizon
14 years
Minimum Initial Premium - Qualified or Non-qualified
$10,000 single premium ($2,000 per option)
$2,000 subsequent premium
Maximum Single Premium
Home office approval is required for premiums in excess
of $1,000,000.
Issue Dates
Issue dates: 1st, 8th, 15th, and 22nd of each month.
Applications and premium checks will be held without interest,
until the next available issue date. Annuities issued on each date
include all applications received no later than 5:00 p.m. (Eastern
time) two business days prior to the issue date.
If the applicable issue date falls on a weekend or OM Financial
Life designated holiday, premiums will be accepted up to 5:00
p.m. (Eastern time) on the OM Financial Life business day two
days prior to the weekend or holiday. For example, if the issue
date is a Sunday, we will accept premiums through the previous
Thursday for that issue date. Premiums received after this
time will be deemed received on the next OM Financial Life
business day (i.e. will be deemed received after the weekend/
holiday issue date).
The index value that will be used when the issue date falls on a
weekend/holiday, will be the index value from the next business
day the index is published, after the weekend or holiday.
For Producer Use Only.
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Spectrum Choice Bonus Product Highlights
Partial Surrenders
Each policy year, after the end of the first policy year, clients
may elect to take a free partial surrender of 10% of the
account value, less any prior free withdrawals taken during
the current year.
Surrender Charges are Waived:
sUpon surrender of 10% or less of the account value as of the
prior policy anniversary.
sUpon annuitization of the policy after the 5th anniversary.
Systematic Withdrawal Option
The client may elect an automatic payment of either a specific
amount or interest only on a recurring basis.
Surrender charges may apply. Minimum payment per mode
is $100. Frequency can be monthly, quarterly, semi-annual
or annual.
Waivers
Nursing Home Waiver
If the owner is confined to a licensed nursing home for more
than 60 days beginning after the first year of the annuity, OM
Financial Life will not deduct a surrender charge from the
account value upon a full or partial surrender.
Terminal Illness Waiver
If, after the first year of the annuity, the owner is diagnosed by a
licensed physician as having an illness or condition resulting in a
life expectancy of less than one year, OM Financial Life will not
deduct a surrender charge from the account value upon a full or
partial surrender.
Unemployment Waiver
If the owner is under age 65 and becomes unemployed after the
annuity is issued, and remains unemployed for at least 30 days,
OM Financial Life will not deduct a surrender charge from the
account value upon a full or partial surrender while the owner
is unemployed.
Minimum Required Distributions
Calculation and payment support available.
Annuity Payment Options
sIncome for a Fixed Period
sLife Income with a Guaranteed Period
sLife Income
sJoint and Contingent Life Income
sJoint and Survivor Life Income with a Guaranteed Period
sJoint and Survivor Life Income
sLife Income with a Lump Sum Refund at Death
Death Benefit
Surrender charges will not be deducted from the account value
if the owner dies. If the minimum guaranteed surrender value
is greater than the account value, the minimum guaranteed
surrender value will be paid. Surrender charges are applied if
the spouse of the first owner to die elects to continue or succeed
to ownership of the annuity and subsequently surrenders the
policy.
Qualified Plans
Rollovers from IRAs, or to serve as a rollover IRA for corporate
401(k), TSAs, pension or profit sharing plans.
Free Look
10 Days or longer as required by state law.
Rate Protection on Section 1035 Exchanges
60 Days
Call your Master General Agent, or our Sales Support Center for
details at 800-445-6758 or email us at sales-support@omfn.com.
Notes
Interest rates are subject to change. Index rates are subject to a cap.*“Standard & Poor’s®”, “S&P®”, “S&P500®”, “Standard & Poor’s 500” and “500” are trademarks of
The McGraw-Hill Companies, Inc. and have been licensed for use by OM Financial Life Insurance Company. The Product is not sponsored, endorsed, sold, or promoted
by Standard & Poor’s and Standard & Poor’s makes no representation regarding the advisability of purchasing the Product. Form numbers: FGL FPDA-EIA-14 (02-05)
[17.5-14A], FGL FPDA-EIA-14 (02-05) [13.25-14B] et al. Subject to state availability. Certain restrictions may apply. Annuities issued by OM Financial Life Insurance
Company, Baltimore, MD.
About Old Mutual Financial Network
Old Mutual Financial Network (OMFN) is the marketing name for the U.S. life insurance and annuity operations of Old Mutual plc,
including OM Financial Life Insurance Company. Each OMFN company is solely responsible for its contractual commitments.
No bank guarantee. • Not FDIC/NCUA/NCUSIF insured. • May lose value if surrendered early.
For Producer Use Only.
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