The Ultimate Guide to US Insurance: Symetra Accumulator IUL 2 Indexed Universal Life Insurance

Ⅰ.Introduction to Symetra

Symetra was founded in 1957 and is a diversified financial services company headquartered in Bellevue, Washington. Although it has only been around for just over 60 years, it has become one of the most popular insurance companies in the US, despite its relative youth compared to other century-old US insurance companies.

Symetra is a New York Stock Exchange-listed insurance company and its financial strength is beyond doubt. In the 2019 Bayes ranking of the top 200 insurance companies in the US based on managed assets, Symetra’s managed assets amounted to $39.9 billion, ranking 36th. Symetra’s parent company is Sumitomo Life, one of Japan’s largest life insurance companies, with a history of over 100 years, and it is a Fortune 500 insurance company.

Symetra’s financial services include life insurance, annuities, retirement plans, and group medical plans. Since 2013, Symetra has consistently ranked among the top three in fixed indexed annuity sales by banks. In 2017, Symetra launched its first indexed insurance product and entered the foreign insurance market in 2019.

Company History:

In 1957, Safeco Insurance Company, a subsidiary of Liberty Mutual Insurance, established Safeco Life & Investments.

In 2004, a consortium led by Warren Buffett, Berkshire Hathaway, and White Mountains Insurance Group acquired Safeco Life & Investments and renamed it Symetra Financial Corporation, which began operating independently.

In 2010, Symetra was listed on the New York Stock Exchange under the ticker symbol SYA.

In 2016, Sumitomo Life Insurance Company acquired Symetra for $3.8 billion.

In 2018, Symetra was named one of the Top 50 Life and Health Insurance Companies by Ward Group.

Credit Ratings:

Symetra’s Comdex score has steadily increased, reflecting its continuously strengthening financial position. As of October 21, 2019.

Financial Strength:

In 2019, A.M. Best, a leading insurance rating agency, selected the top 200 US life and health insurance companies based on total assets under management, and Symetra’s managed assets amounted to $39.9 billion, ranking 36th, up two places from 2017.

Ranking of US Indexed Universal Life Insurance Companies

1. Pacific Life
2. National Life Group
3. TransAmerica Life
4. Minnesota Life
5. Nationwide
6. Zurich
7. Lincoln National Life
8. Prudential (not to be confused with UK-based Prudential)
9. Allianz
10. AXA
11. Voya

The above rankings are from the 2018 Wink® Top Indexed Universal Life Insurance Brands.

Ⅱ.Symetra Product Introduction

The Symetra Accumulator IUL 2 Index Universal Life Insurance is one of the most advanced products in the current U.S. life insurance market, focusing on accumulating policy cash value while providing high death benefit protection. Its profit account is mainly linked to mainstream stock indexes, ensuring that clients’ account funds are not affected by market downturns through structured operations. It provides considerable growth potential when the stock market surges, and its overall rate of return far exceeds that of other types of insurance. The policy value of clients is not directly invested in the market, so they do not have to be investment experts to benefit from market growth. Clients can purchase this insurance product for various needs, such as children’s education, retirement planning, and wealth inheritance.

1. Product Architecture
2. Product Elements
3. Product Features

Flexible Premium Payment

The Index Universal Life Insurance has flexible premium payment options, including monthly, quarterly, semi-annual, and annual payments, and the amount of premium payments is also flexible.

This product is designed for middle-to-high-income groups. If the full premium is paid for the first 10 years, it can guarantee the continuous generation of ideal cash value accumulation in the absence of any premium income in the future. Clients can also pay premiums flexibly, with higher leverage and higher death benefit, but this payment method results in slower cash value accumulation and potential policy risk in the future.

Therefore, tailoring a policy design for each client is particularly important!

Guaranteed Persistency Bonus

Starting from the 11th year of the policy, a bonus of 15% is guaranteed for the continuous account earnings.

Applicable to interest in the index account, the holding account, and the fixed account, but not applicable to the standard loan account.

For example, if the current settlement rate of the fixed account is 5%, the interest rate including the bonus settlement to the policy value will be 5.75%. If the value of the index part is $1,000, the index settlement including the bonus will be $1,150.

No-Lapse Guarantee

If the total insurance premium minus any withdrawals or loans is greater than the cumulative minimum monthly premium, the policy provides a guarantee of no lapse for up to 20 years based on the insured person’s age. During this period, regardless of how the policy’s cash value account changes, even if the policy’s cash value drops to 0, the policy is guaranteed not to lapse.

Lookback Guarantee

Every 8 years, if the average annual return within the period is less than 2%, the minimum guaranteed return of 2% is ensured by offsetting. The first 8-year period starts when the policy is effective, and every 8 years thereafter, a new calculation is made after the previous lookback period ends.

Guaranteed Policy Value on Surrender

The guaranteed minimum surrender account earnings is 2%.

Dollar Cost Averaging (DCA)

Allows a one-time payment (whether or not it is 1035) to be distributed over several months to the indexed interest account of your choice, so that the entire payment is not solely based on the market performance of a single date. Using this additional guarantee will affect the amount of interest earned by your policy, which may increase or decrease depending on the index performance. It is up to you whether to use it or not.

Rider

Accelerated Death Benefit for Chronic Illness Rider

Accelerated Death Benefit for Terminal Illness Rider

Overloan Lapse Protection Rider

4. Yield Account

Symetra Accumulator IUL 2 offers 9 indexed strategies and a fixed account. The indexed strategies allow you to experience a portion of the potential market growth without taking on the risk of market declines. The indexed strategies lock in any interest gains and help protect against losses from market declines.

Fixed Account

The fixed account settles based on the company’s published fixed interest rate:

Guaranteed Interest Rate: 1%

Indexed Account

The indexed account includes the S&P 500 index, the J.P. Morgan ETF Efficiente® 5 index (which is an exclusive volatility control option licensed to Symetra), and a blended index of the J.P. Morgan ETF (50%) and the S&P 500 (50%).

Base Options

The Base Options offers a lower indexed cap and participation rate compared to other indexed strategies but guarantees additional indexed interest credits. This strategy is suitable for the account value at the end of the indexing segment.

The 1-year term indexed strategy offers an additional interest credit of 0.5%.

The 2-year term indexed strategy offers an additional interest credit of 1.0%.

Core Options

The Core Options offers a higher indexed cap and participation rate than the Base strategy.

Select Options

The Select Options requires an additional cost but offers the opportunity to achieve higher indexed caps and participation rates than the Core and Base strategies.

The 1-year term indexed strategy incurs an additional cost of 0.5%.

The 2-year term indexed strategy incurs an additional cost of 1.0%.

Indexed Strategy Overview

Historical Performance over 25 Years

Base Options

Core Options

Select Options

Illustration Rates

The maximum illustration rates for each strategy are calculated based on the actual indexed performance of the past 20 and 25 years starting from January 1, 1994, using the current indexing caps, floors, and participation rates. The maximum illustration rates and historical average rates do not represent future rates of return.

Historical Performance

Starting from the current calendar year, using the current participation rate, indexing cap, and floor, the average rates of return for all 25-year periods are calculated by reviewing the past 66 years of the S&P 500 index performance (excluding dividends), resulting in the minimum and maximum rates of return:

Maximum rate of return 8.90%

Minimum rate of return 4.46%

How to Calculate Yield

5. Withdrawals and Policy Loans

Withdrawals

Minimum withdrawal: $250;

Maximum allowed withdrawal based on the net surrender value of the policy and other factors;

Can be made after the first policy year;

Fee: currently $0, maximum $25.

Policy Loans

Ⅲ.Symetra Case Study

1. Client Profile (for example only)
2. Policy Proposal Demonstration (excerpt)
3. CVIRR

Ⅳ.Symetra Comprehensive Evaluation

Symetra Insurance Company has not been in the life insurance field for very long, but young insurance companies often have highly competitive aspects that can help certain specific policyholders. Especially for policyholders who have quit smoking for more than 12 months, Symetra can provide a standard health rating that far exceeds industry standards, resulting in significantly reduced premiums for the policyholder.