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How Interest is Credited (Continued)

Indexing Method

The Annual Point-to-Point method and the Annual Monthly Averaging method have different approaches to measure changes in the index over time.

Annual Point-to-Point – In this method, we compare the closing value of the Index on the contract anniversary to its closing value on the previous contract anniversary.

Annual Monthly Averaging – In this method, we calculate an average value for the Index during the year by taking the average of the 12 closing Index values on each contract monthiversary, and then compare this average value to the closing value on the previous contract anniversary.

Once these index changes are calculated, we apply the Cap or Participation Rate associated with the selected Index Crediting Strategy to determine the annual interest rate to be credited.

In the case of a negative result, the interest rate credited will be zero. In no scenario will the policy ever have a negative interest rate or decline in value.

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