How Interest is Credited

Interest is earned in two ways:

Fixed Account – The owner may allocate a percentage of their initial premium into the Fixed account. The interest rate for the Fixed account could change on each policy anniversary date, however, it is guaranteed to never fall below 1% for as long at the policy is in force. The rate in the Fixed Account is expressed as an annual effective yield and is compounded and credited daily for as long as the policy is in force.

Indexed Account – In addition to, or instead of the Fixed account, the owner my allocate a percentage of their initial premium into to any or all of the Indexed Accounts. There are currently 4 indexed strategies available based on the S&P 500© and the Nasdaq-100®. These options are selected by the owner on the policy application and may be changed or reallocated at each anniversary date. Interest is credited into the Indexed Account(s) on the Contract Anniversary Date according to the performance of each external index. Summit FIAs do not participate directly in these or any indexes. As such, any dividends paid on stocks on which these indexes are based do not increase annuity interest earnings.

Interest earnings credited into the Indexed Account can never be less than zero, even if the Index return is negative.

Reallocation Strategy

If the policyowner wishes to change their allocation strategy, they must notify the company in writing at least 7 days prior to the Contract Anniversary Date. Automatic rebalancing is not available.

If the owner adds additional premium during the year, those funds will be been placed into the Fixed Account. On the Contract Anniversary Date, those funds may be reallocated based on the selected Indexed strategy.