Pacific Index Edge

A Deferred, Fixed Indexed Annuity

Pacific Index Edge is not available in New York.

Pacific Index Edge was designed for higher growth potential through:

  • A variety of diverse interest-crediting options.
  • Well-known indexes with established histories.
  • No annual contract, mortality and expense, or administrative fees.

You also can provide higher income opportunities to your clients through the optional Interest Enhanced Income Benefit for an additional cost.  


Client Profiles

Consider Pacific Index Edge for:

  • Conservative pre-retirees and retirees.
  • Savers interested in growth potential without market risk.
  • Clients who will need retirement income within 10 years.

Key Features

Choice of Withdrawal Charge Periods

  • 7 years
  • 10 years (not available in California)

Only one withdrawal charge period may be selected per contract. Rates (including interest rates, participation rates, caps, and spreads) are guaranteed for the length of the initial one- or two-year index term or one-year term for the fixed account option.

A Choice of Indexes. Simple, Flexible Interest-Crediting Options

Pacific Index Edge offers a variety of Interest-Crediting Options.

  • S&P 500® Index: 1-Year Point-to-Point with Cap
  • S&P 500® Index: 1-Year Participation Rate with Spread
  • BlackRock® EnduraTM Index: 2-Year Point-to-Point with Spread
  • Fixed Account Option

Clients have the flexibility to allocate to one or any combination of options, and can choose to reallocate their options at the end of each index term or Fixed Account Option term.

The BlackRock iBLD Endura VC 5.5 ER Index is referred to as the BlackRock Endura Index for ease of reference.


Optional Benefits

Pacific Index Edge offers an optional guaranteed minimum withdrawal benefit that can provide guaranteed lifetime income beginning at age 59½, or an optional death benefit that can help protect and enhance the legacy your clients leave to their beneficiaries.

Interest Enhanced Income Benefit

Interest Enhanced Income Benefit provides guaranteed withdrawals for life, regardless of the amount of interest that is earned on the contract. It also provides opportunities to increase retirement income through an Annual Credit, which allows your client's Protected Payment Base to grow by the amount of interest credited to the contract plus a 5% roll-up for up to 10 years. This credit is not added to the contract value and is not a rate of return.

Fee: 0.75% (maximum charge of 1.50%) of the Protected Payment Base deducted annually for both the Single Life and Joint Life options.

 

Interest Enhanced Death Benefit

Interest Enhanced Death Benefit can enhance the legacy your clients leave to loved ones by providing guaranteed growth of the Death Benefit Base, no matter how the market performs. The Death Benefit Base is guaranteed to grow by the amount of interest credited to the contract, plus an additional 2% roll-up, compounded annually, for either 20 years, until age 85, or in some states, up to a maximum roll-up amount of 250% of total purchase payments (adjusted proportionately for withdrawals), whichever is earlier.

Fee: 0.40% of the Death Benefit Base deducted from the contract value annually.


Additional Information

Withdrawal Charges and Fees

Withdrawal charges apply only during the withdrawal charge period when the amounts taken are more than those discussed in the "Withdrawals without Charge" section below.

The following withdrawal charge schedules will apply as indicated in all states (except California).


7 Years

Contract Year 1 2 3 4 5 6 7
Charge per Withdrawal
7% 7% 7% 7% 6% 5% 4%


10 Years

Contract Year 1 2 3 4 5 6 7 8 9 10
Charge per Withdrawal
9% 9% 8% 7% 6% 5% 4% 3% 2% 1%


In California, the withdrawal charge schedule is as follows:


7 Years

Contract Year 1 2 3 4 5 6 7
Charge per Withdrawal
9% 8% 7% 6% 5% 4% 3%


Market Value Adjustments (MVAs)

If either of the following occur during the withdrawal charge period, an MVA may apply (in addition to any applicable withdrawal charge fees):

  • Withdrawals in excess of 10% of the prior anniversary’s contract value (10% of purchase payments in the first year).
  • Annuitization of the contract value.

For more information about the MVA formula, please refer to the MVA endorsement that accompanies the contract. View daily index yields for the J.P. Morgan 10-Year U.S. Liquid Index here.

There is no MVA assessed on withdrawals made after the withdrawal charge period has expired. Please note, the MVA does not apply in CA.


Withdrawals without Charge

Withdrawals are permitted 30 days after contract issue. In the first contract year, the maximum is 10% of the total purchase payments. For each subsequent contract year, the maximum is 10% of the contract value as of the prior contract anniversary.

In addition, the withdrawal charge and the MVA will be waived for:

  • Required minimum distribution (RMD) withdrawals (only if calculated by Pacific Life).
  • Withdrawals after the first contract year if the owner or annuitant has been diagnosed with a terminal illness (life expectancy of 12 months or fewer; 24 months in KS). Not available in CA.
  • Withdrawals after 90 days of contract issue if the owner or annuitant has been confined to an accredited nursing home for 30 days or more, as long as the nursing home confinement began after the contract was issued. Not available in CA or MA.
  • Withdrawals after 90 days of contract issue if the owner or annuitant has been confined to an accredited facility that provides skilled nursing care and/or long-term care services for 30 days or more, and the confinement began after the contract was issued. Not available in CA or MA.
  • Death benefit proceeds.
  • Annuity income payments (available after first contract year; an MVA may apply).
  • Withdrawals up to the Lifetime Annual Withdrawal Amount under the optional Interest Enhanced Income Benefit.

Note: For Index-Linked Options, no interest is earned or credited on amounts withdrawn prior to the end of an index term.

 

Guaranteed Minimum Surrender Value

  • The Guaranteed Minimum Surrender Value is equal to 87.5% (91% in IA, MN, MO, NH, NJ, PA, UT, and WA) of purchase payments minus prior withdrawals and applicable optional benefit fees1, accumulated at a fixed interest rate, which is set at contract issue.
  • Calculated at full withdrawal, death, or annuitization.
  • Clients are guaranteed to receive the greater of the contract value (minus applicable optional benefit charges, a market value adjustment (MVA), and/or withdrawal charges) or the Guaranteed Minimum Surrender Value.
  • Guaranteed for the life of the contract.

1Optional benefit fees are not deducted from the Guaranteed Minimum Surrender Value in AL, IA, MN, MO, NC, NH, NJ, OH, PA, UT, and WA.

Fixed Account Option

  • Each Fixed Account Option term is one contract year.
  • Interest credited daily.
  • The initial rate is guaranteed for the first term.
  • Renewal rates are declared annually and will never be lower than the minimum guaranteed interest rate stated in the contract.
     

Index-Linked Options
Interest may be credited at the end of each one- or two-year index term depending on the amount of change in an index price.

View daily values and additional information about the BlackRock Endura Index.

 

Interest Breakpoints

Breakpoints apply for all Interest-Crediting Options and are based on the initial purchase payment.

  • Less than $100,000
  • $100,000 and more

If a subsequent purchase payment results in the total payments (minus withdrawals and applicable withdrawal charges) exceeding $100,000, the higher breakpoint will be used in determining the interest credited at the end of the initial term. Once a higher breakpoint is reached, subsequent withdrawals during the initial term will not reduce the breakpoint used to determine interest credited at the end of the initial term. After the initial term, a higher breakpoint will be used to determine interest credited for renewal terms if the contract anniversary value exceeds $100,000.
 

Transfers

  • Effective on contract anniversary, but can be requested up to 30 days after the contract anniversary.
  • Clients may transfer their Fixed Account Option value and expired index terms to any available Index-Linked Option or the Fixed Account Option.
  • Transfer cannot be made to or out of an active 2-year index term.

Clients may convert the contract to annuity income payments one year after contract issue. An MVA may apply.

  • Payments are based on the greater of the contract value or the Guaranteed Minimum Surrender Value.
  • Pro rata index-linked interest is credited to the contract value upon annuitization.

Annuity Income Options Available

  • Life Only
  • Life with Period Certain (5–30 years1)
  • Joint and Survivor Life
  • Period Certain Only (up to 30 years1)

Type
Fixed annuitization only
Partial annuitization is not available

Frequency
Monthly, quarterly, semiannually, annually

Minimum Annuity Income Payment Amount
$250

For no additional cost, if death occurs before annuity income payments begin, a death benefit equal to the greater of the contract value or the Guaranteed Minimum Surrender Value is paid upon the death of the first owner or the last annuitant. Pro rata index-linked interest is credited to the contract value on the Notice Date (the date Pacific Life receives the death benefit claim in good order). 

Premium: Limited premium. 1035 exchange/transfer requests must be submitted with the application and the funds received within 60 days after contract issue.

Please note: Additional cash purchase payments up to $100,000 are permitted within the first 60 days of contract issue. Interest will be credited proportionately based on the date the additional purchase payment is received and the index return from the date the additional purchase payment is received to the end of the index term. This period may be less than the time frames listed above.

Minimum Purchase Payment: $25,000 (qualified and nonqualified).

Maximum: $1 million; total purchase payments greater than $1 million require Pacific Life home-office approval in advance. 

Maximum Annuitant/Owner Issue Age: 85

Maximum Annuitization Age: 95


Guarantees are subject to the claims-paying ability and financial strength of the issuing insurance company.

1For qualified contracts, the maximum length of time for the Period Certain options may be less than 30 years, if necessary, to comply with RMD regulations for annuities.

Broker/dealer and state variations may apply. Contact your broker/dealer for availability.

Fixed indexed annuities are not securities and do not participate directly in the stock market or any index, so they are not investments. 

Annuity withdrawals are taxable as ordinary income when distributed and may be subject to a 10% additional tax if withdrawn before age 59½.For nonqualified contracts, an additional 3.8% federal tax may apply on net investment income. Withdrawals will reduce the contract value and the value of the death benefits, and also may reduce the value of any optional benefit.

Guaranteed rates and caps will never be set below the minimum or above the maximum stated in the contract. Pacific Life determines, at its discretion, guaranteed rates and caps in excess of the minimum or below the maximum guaranteed in the contract.

The S&P 500® index is a product of S&P Dow Jones Indices LLC (“SPDJI”), and has been licensed for use by Pacific Life Insurance Company. Standard & Poor’s®, S&P®, and S&P 500® are registered trademarks of Standard & Poor’s Financial Services LLC (“S&P”); Dow Jones® is a registered trademark of Dow Jones Trademark Holdings LLC (“Dow Jones”); and these trademarks have been licensed for use by SPDJI and sublicensed for certain purposes by Pacific Life. Pacific Life’s product is not sponsored, endorsed, sold, or promoted by SPDJI, Dow Jones, S&P, their respective affiliates, and none of such parties make any representation regarding the advisability of investing in such product(s), nor do they have any liability for any errors, omissions, or interruptions of the S&P 500® index.

BlackRock, Inc. and its affiliates (“BlackRock”) is not the issuer or producer of any annuity product associated with Pacific Life Insurance Company and BlackRock has no responsibilities, obligations or duties to investors in such products. The BlackRock iBLD Endura VC 5.5 ER (hereinafter, the “BlackRock Endura Index”) Index is a product of BlackRock Index Services, LLC and has been licensed for use by Pacific Life Insurance Company. BLACKROCK, BlackRock Endura Index, and the corresponding logos are registered and unregistered trademarks of BlackRock. While Pacific Life Insurance Company may for itself execute transactions with BlackRock in or relating to the BlackRock Endura Index in connection with its annuity products, investors acquire all such annuity products from Pacific Life Insurance Company and neither acquire any interest in the BlackRock Endura Index nor enter into any relationship of any kind with BlackRock upon investing in such products. Pacific Life Insurance Company annuity products are not sponsored, endorsed, sold or promoted by BlackRock. BlackRock makes no representation or warranty, express or implied, to the owners of any Pacific Life Insurance Company annuity product or any member of the public regarding the advisability of investing in such products nor does it have any liability for any errors, omissions or interruptions of the BlackRock Endura Index. BlackRock shall not be liable in any way to the issuer, investors, or any other party in respect of the use or accuracy of the BlackRock Endura Index or any data included therein.

The indexes are not available for direct investment. The S&P 500® index performance does not include the reinvestment of dividends.

Pacific Index Edge (30-1503), including optional riders and endorsements (20-1404, 20-1406, 20-1504, 20-1505, 20-1506, 20-1500, ICC16:15-1403), are issued by Pacific Life. Contract form series, rider series, and endorsements may vary by state.

For Use With Clients
 
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Pacific Life, its distributors, and respective representatives do not provide tax, accounting, or legal advice. Any taxpayer should seek advice based on the taxpayer's particular circumstances from an independent tax advisor or attorney.

Pacific Life is a product provider. It is not a fiduciary and therefore does not give advice or make recommendations regarding insurance or investment products.

Pacific Life refers to Pacific Life Insurance Company and its affiliates, including Pacific Life & Annuity Company. Insurance products are issued by Pacific Life Insurance Company in all states except New York and in New York by Pacific Life & Annuity Company. Product availability and features may vary by state. Each insurance company is solely responsible for the financial obligations accruing under the products it issues. 

Variable insurance products are distributed by Pacific Select Distributors, LLC (member FINRA & SIPC), a subsidiary of Pacific Life Insurance Company (Newport Beach, CA) and an affiliate of Pacific Life & Annuity Company. Variable and fixed annuity products are available through licensed third parties.

No bank guarantee • Not a deposit • Not FDIC/NCUA insured • May lose value • Not insured by any federal government agency