OREANDA-NEWS. To help address the changing financial challenges of retirement, Prudential Annuities, the domestic annuity business of Prudential Financial, Inc. (NYSE:PRU), today announced the launch of its new Prudential Defined Income® variable annuity and Prudential Highest Daily Lifetime Income® v2.1, the latest version of its innovative Highest Daily variable annuity optional benefit.

Prudential Defined Income is a long-term retirement investment that provides clients with the security of knowing exactly what their guaranteed lifetime income will be, whether they take income immediately or in the future.

Prudential’s new defined income product, available to investors as young as age 45, invests 100 percent of the premiums in the AST Long Duration Bond Portfolio, where returns accumulate on a tax deferred basis.

Prudential Defined Income offers:
Guaranteed lifetime income growth: The income withdrawal amount is guaranteed to grow every day until lifetime income begins, while maintaining the flexibility of access to the investment.
Defined lifetime income: The amount of income guaranteed for life and the level of deferred income growth is known at issue.
Flexibility and Control: Investors decide when to take income, how much income to take, and continue to have access to their account value if they need it. Provides investors with control of their assets for legacy planning.
Bond portfolio: Designed to create higher yield through investment primarily in a diversified mix of longer-duration investment grade bonds.

Prudential Defined Income provides investors in The Retirement Red Zone ® access to a higher level of guaranteed minimum income than generally found with other variable annuities. For example, at launch, PDI offers clients aged 65 a 5% annual lifetime withdrawal rate based on their premiums and the opportunity to grow their guaranteed income amount by 5.5% annually for as long as they defer taking lifetime income. The product is also designed so that these rates can be dynamically adjusted for new contracts based on prevailing interest rates as well as other factors.

“Now more than ever, Americans need product alternatives that help them transition from accumulation to retirement income. Prudential Defined Income is our latest innovation: a bond-driven strategy that offers income certainty, the benefit of the potential for higher expected yields of the AST Long Duration Bond Fund, and age-based guaranteed income rates,” says Bruce Ferris, head of Sales and Distribution for Prudential Annuities. “Prudential Defined Income provides the income certainty that many clients are seeking, while helping to alleviate their concerns with equity market volatility. The addition of Prudential Defined Income allows us to provide guaranteed income options for investors that are both equity and bond based.”

Prudential Annuities also announced today the launch of Highest Daily Lifetime® Income v2.1 and Spousal Highest Daily Lifetime Income v2.1, which replaces Highest Daily Lifetime Income v2.0 and Spousal Highest Daily Lifetime Income v2.0 benefits.

Prudential’s Highest Daily Lifetime Income benefits, available for an additional fee with a variable annuity from Prudential issuing companies, allow investors the opportunity to ‘lock in’ the highest daily value of their annuity contract, for income purposes, each day the market is open. The benefits offer a Protected Withdrawal Value (the basis for guaranteed lifetime income) based on the Highest Daily account value plus an immediate 5% annual compounded growth until the 10th benefit anniversary or until lifetime withdrawals begin, whichever is sooner.

Depending on age at the first withdrawal of lifetime income, individuals will receive between 3% - 6% of their protected withdrawal value annually. Spousal versions are .50% lower for all age bands.

“Our Highest Daily benefits provide investors with a strong minimum income guarantee, the benefits of daily lock-in of account value highs, and the potential to benefit from rising equity markets,” said Ferris. “Reflecting the current interest rate environment, we have continued to adjust our Highest Daily benefit to ensure that it provides a compelling value proposition both for clients and Prudential.”

Launched in 2006, Prudential Annuities’ Highest Daily suite of living benefits offer daily lock-ins for retirement income purposes — and immediately grow them until the first lifetime withdrawal or 10 years from election. Key features include:
Daily step-ups: 100% certainty in capturing portfolio gains for income purposes, until first lifetime withdrawal.
Daily benefit base growth: Benefit base grows every day regardless of market conditions due to immediate credit of the growth rate, until 10th benefit anniversary or the first lifetime withdrawal, whichever is sooner.
Innovative investment platform: Offering 19 actively managed asset allocation portfolios that help to drive daily step-ups.
Proprietary Risk Management: A proprietary mathematical formula that monitors an investor’s account daily and automatically transfers amounts between the chosen variable investment portfolios and the AST Investment Grade Bond Portfolio.
Highest Daily Death Benefit: Offers legacy protection through an optional integrated death benefit that locks in account highs daily, for an additional fee.