Terminal Funding Group Annuity Contracts

Under a Terminal Funding contract, annuity purchases can be made for participants retiring under the contract on an as needed or on going basis as they retire. In effect, it can be a series of single premium purchases under one Group Annuity Contract. The Terminal Funding Contract is suitable for an active plan.

The need for these group annuity contracts can result from a plan sponsor’s desire to alleviate administrative costs or as an added benefit option for departing employees who desire a reliable immediate fixed annuity option upon retirement.

Applications

PENSION PLAN TERMINATION

• Replacement with 401(k) program
• Mergers and acquisitions
• Bankruptcy and financial hardship
• Frozen plans

SETTLEMENTS

• Accounting gains (FAS 87 / 88)
• Expense savings for terminated vested or retired participants
• Risk transfer

New York Life

NYLIM Guaranteed Products offers a broad range of traditional and customized products to institutional investors with low risk characteristics that seek to provide stable returns.

New York Life’s Terminal Funding Group Annuity Contract is a non-participating group annuity contract designed to provide guaranteed fixed annuity benefits payable under either Qualified Defined Benefit or Defined Contribution plans.

David D'Auria,
Second Vice President
Phone: 973-394-3264
david_d’auria@nylim.com

John Hancock

Kevin Farquhar - 617-663-4740

AIG

A Terminal Funding or Annuity Buyout contract is a Single Premium Group Annuity (SPGA) product that can guarantee benefits of a pension plan's retired, active or deferred vested participants. The insurer determines the present value, or premium, needed to purchase a group contract through which the employer or plan sponsor can transfer selected plan liabilities in the form of fixed or variable annuities for each plan member. Buyouts are typically used in cases of plan termination or settlements, often in conjunction with corporate restructuring.

For more details about Annuity Buyouts, please contact us at 212-770-2334 or email us at pensionannuitybuyouts@aig.com.

Non-Carrier Expertise

ALIRT Research’s Termination Annuity Issuer Analysis service provides for a thorough and impartial financial analysis of insurers bidding for termination annuity business and ensures a robust procedure supported by independent expertise.