Important Updates Regarding Cap and Illustrated Rates

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Important Updates Regarding Cap and Illustrated Rates

If you follow the markets, you already know there’s been significant volatility, which is seemingly par for the course in 2020! As you may recall, market volatility affects our investment experience and increases hedging costs. As a result, Global Atlantic, like many carriers, must review its anticipated experience and adjust its cap rates to appropriately manage the business. We do this to ensure our continued financial strength that you and your clients have come to know and rely upon.

 

In light of the continued low, long-term interest rate environment and recent increases in hedging costs, we will be adjusting cap and illustrated rates on currently available IUL products and on in force IUL products, effective February 1, 2021. Premiums and or applications received AFTER January 22, 2021, will be subject to new cap rates that will take effect February 1, 2021. Applications received after January 22, 2021, will require an illustration that reflects the new cap and illustrated rates prior to issuing the policy. In addition:

  • Business that is issued and paid on or before January 22, 2021 — nothing additional is needed.
  • Business issued on or after January 22, 2021, with current cap rates reflected on the illustration attached to the policy but paid after January 22, 2021 — a notice/disclosure will be sent to the agent informing them that the new cap rate was applied to the premium/policy.
  • If an application and illustration is received prior to January 22, 2021, but not issued and paid until after January 22, 2021, — New Business will send an illustration with the policy at issuance to the agent reflecting the new cap rate. The updated illustration will need to be signed and returned on delivery of the policy.
  • All business received after January 22, 2021 will receive the new cap and illustrated rates.

The illustration system will be updated with new rates on December 31, 2020.

Cap and illustrated rates for currently available IUL products are below:

Lifetime Foundation ELITE Current/Prior New
Rate/
Cap
Illustrated
Rate
Rate/
Cap
Illustrated
Rate
Basic Interest 3.45% 3.45% 3.45% 3.45%
1 Yr Fixed 3.45% 3.45% 3.45% 3.45%
1 Yr PTP 10.00% 6.17% 9.75% 6.08%
2 Yr PTP 24.00% 6.17% 23.00% 6.08%
Monthly Cap 3.10% 5.25% 3.00% 5.08%
International HS 11.75% 6.17% 11.25% 6.08%
Increased Par 9.00% 6.13% 8.75% 6.00%
Elevated Cap 12.50% 6.17% 12.00% 6.08%
Lifetime Builder ELITE 2020 Current/Prior New
Rate/
Cap
Illustrated
Rate
Rate/
Cap
Illustrated
Rate
Basic Interest 3.75% 3.75% 3.75% 3.75%
1 Yr Fixed 3.75% 3.75% 3.75% 3.75%
1 Yr PTP 12.00% 7.05% 10.50% 6.44%
2 Yr PTP 28.00% 7.05% 24.50% 6.44%
Monthly Cap 4.00% 6.94% 3.40% 5.91%
Increased Par 9.50% 6.44% 8.00% 5.52%
Elevated Cap 16.50% 7.05% 14.75% 6.44%
Global Accumulator Current/Prior New
Rate/
Cap
Illustrated 
Rate
Buy-Up Charge Par Rate Rate/
Cap
Illustrated
Rate
Buy-Up
Charge
Basic Interest 3.55% 3.55% n/a 3.55% 3.55%
1 Yr Fixed 3.55% 3.55% n/a 3.55% 3.55%
1 Yr PTP 10.50% 6.40% 100% 9.25% 5.84%
Increased Par 8.00% 5.49% 200% 7.00% 4.87%
BlackRock Diversa 13.50% 6.10% 200% 12.75% 5.59%
Buy-Up Secure 10.50% 6.40% 1.25% 25% (unchanged) 9.25% 5.84% 1.25%
Buy-Up Performance 10.50% 6.40% 5.25% 110% (unchanged) 9.25% 5.84% 5.25%
Benefit Builder Xtra Current/Prior New
Rate/
Cap
Illustrated 
Rate
Buy-Up Charge Par Rate Rate/
Cap
Illustrated
Rate
Buy-Up
Charge
Basic Interest 4.00% 4.00% n/a 4.00% 4.00%
1 Yr Fixed 4.00% 4.00% n/a 4.00% 4.00%
1% Floor 9.50% 6.21% n/a 8.50% 5.74%
International EA 12.00% 6.40% n/a 10.75% 5.89%
1 Yr PTP 10.50% 6.40% 100% 9.50% 5.96%
Increased Par 9.00% 6.13% 200% 8.00% 5.52%
BlackRock Diversa 14.00% 6.21% 200% 13.50% 5.74%
Performance Buy-Up 14.50% 7.95% 3.00% 25% 13.50% 5.96% 3.00%
Performance Buy-Up Xtra 15.50% 8.30% 5.00% 50% 14.50% 5.96% 5.00%
To view new cap and illustrated rates for in force products, click HERE.

 

 

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