Products January 6, 2010

AXA Launches Variable Annuity with Downside Protection

AXA Equitable Life Insurance Company has rolled out the Retirement Cornerstone, a variable annuity that aims for both accumulation and preservation of wealth.
Reported by

The new product is a tax-deferred investment platform supporting two accounts: one focused on the opportunity to maximize investment performance and the other focused on providing retirement protection, according to AXA.

The firm said the objective of the long-term accumulation account is to access the growth potential of more than 90 investment portfolio choices across a broad spectrum of asset classes and investment styles.

The objective of the downside-protection account is to provide a guaranteed income benefit option that invests in asset allocation and index portfolios.

The Retirement Cornerstone has a “roll-up” rate declared annually at one point above an average of the 10-year Treasury rate (the initial rate is 5% and can adjust to a maximum of 8% and never below 4%). The rate is the annual percentage increase to the benefit base, which is used to calculate a guaranteed minimum income (or withdrawal amount).

AXA said the dual-account platform gives investors the opportunity to pursue more aggressive investment recovery strategies, while retaining the option of when to optimize guarantee features.

“The extreme volatility of the recent past drove many investors into overly conservative positions at the worst possible moment,” said Christopher M. “Kip” Condron, chairman and chief executive officer of AXA Equitable, in an announcement. “The unique value of Retirement Cornerstone is the simple way it can give people the confidence they need to once again invest for growth, but without giving up the comfort of having a reliable guarantee—all on one platform.”

More information is available at www.axa-equitable.com.

For more stories like this, sign up for the PLANADVISERdash daily newsletter.

Compliance January 5, 2010

New IRS Document Updates Determination Letter Procedures

The Internal Revenue Service (IRS) has updated its procedures for requesting determination letters on the qualified status of pension, profit-sharing, stock bonus, annuity, and employee stock ownership plans.
Reported by

The tax agency said Revenue Procedure 2010-6 covers plans under tax codes 401(a), 403(a), 409, and 4975, and replaces Revenue Procedure 2009-6 issued in January 2009. The new procedures are effective February 1.

The revamped document outlines general procedures for requesting determination letters and specific procedures for master and prototype and volume submitter plans, including information on employer reliance on master and prototype and volume submitter plans.

The tax agency also laid out determination letter application procedures for multiple employer plans, group trusts, and affiliated service groups.

Specific changes in the procedures include:

  • a revision to Section 7.03 to include a reference to the first submission period for Cycle E individually designed plans and Section 414(d) governmental plans, and to indicate that applications will be returned with user fees if an off-cycle submission is not reviewed before the end of the on-cycle submission period;
  • a revision to Section 12.02(6) to clarify that Form 8905, Certification of Intent to Adopt a Pre-Approved Plan, must be executed before the end of an employer’s five-year remedial amendment cycle; and
  • a revision to Section 12.07 to clarify that a terminating plan generally does not have to be restated.

The new document is available here.

Never miss a story — sign up for PLANADVISER newsletters to keep up on the latest retirement plan adviser news.

«