Fort Dearborn Life Targets Conservative Investors with Classic Fortifier Annuity |
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Written by U.S. Insurance News
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Sunday, 10 February 2008 |
Conservative investors with a minimum of $4,000 to invest have another annuity option.
Chicago-based Fort Dearborn Life Insurance Company has created the Classic FortifierTM, a flexible, premium-deferred fixed annuity.
According to Ken DiFrancesca, vice president for retirement and individual products with Fort Dearborn Life, the new annuity provides consumers with two key advantages- liquidity and control.
"It is ideal for conservative investors who would like to consolidate their assets into one tax-deferred vehicle and still exercise the right to withdraw their funds if the interest rate drops," DiFrancesca explained.
Investors who choose the Classic Fortifier must make an initial deposit of at least $4,000. They can make additional deposits during the first 12 months of the contract, and a first-year interest rate bonus is applied to all premiums received during the initial 12 months. All deposits during the first year of the contract are subject to the same five-year surrender charge schedule. However, the annuity allows an annual partial surrender of up to 10 percent of the account value after the first year of the contract without incurring surrender charges.
The "bail-out" feature of the Classic Fortifier provides the investor with liquidity. If the renewal rate falls below the initial base credited rate, the owner may make a full or partial withdrawal of the account funds within 30 days after the contract anniversary without incurring any surrender charges. In addition, the contract allows a 100 percent waiver on nursing home and terminal illness.
The Classic Fortifier product is not yet approved in all states.
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