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As Of Filer Filing For·On·As Docs:Size Issuer Filing Agent 4/23/21 Sep Acct A of Pacific Life Ins Co 485BPOS 5/01/21 3:14M Toppan Merrill/FA → Separate Account A of Pacific Life Insurance Co. (811-08946) ⇒ Pacific Choice Income |
Document/Exhibit Description Pages Size 1: 485BPOS Post-Effective Amendment Filed Pursuant to HTML 8.33M Securities Act Rule 485(B) 2: EX-99.(10) Miscellaneous Exhibit HTML 11K 3: EX-99.(13) Miscellaneous Exhibit HTML 40K
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As filed with the Securities and Exchange Commission on April 23, 2021.
Registration Nos. 333-236927
811-08946
SECURITIES AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM N-4
REGISTRATION STATEMENT | X | |
Pre-Effective Amendment No. | O | |
Post-Effective Amendment No. 1 | X | |
and/or
REGISTRATION STATEMENT | X |
Amendment No. 719 (Check appropriate box or boxes) | X | |
SEPARATE ACCOUNT A
(Exact Name of Registrant)
PACIFIC LIFE INSURANCE COMPANY
(Name of Depositor)
700 Newport Center Drive
Newport
Beach, California 92660
(Address of Depositor’s
Principal Executive Offices) (Zip Code)
(949) 219-3943
(Depository’s Telephone
Number, including Area Code)
Brandon
J. Cage
Assistant
Vice President
Pacific
Life Insurance Company
700 Newport Center Drive
Newport Beach, California 92660
(Name and Address of Agent for Service)
Approximate Date of Proposed Public Offering:
It is proposed that this filing will become effective (check appropriate box)
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O
immediately upon filing pursuant to paragraph (b) of Rule 485
X on May 1, 2021 pursuant to paragraph
(b) of Rule 485
O 60 days after filing pursuant to paragraph (a)(1) of Rule 485
O on ________
pursuant to paragraph (a)(1) of Rule 485
If appropriate, check the following box:
O This post-effective amendment designates a new effective date for a previously filed post-effective amendment.
Title of Securities Being Registered: Interests in the Separate Account under Pacific Choice Income individual flexible premium deferred variable annuity contracts.
Filing Fee: None
Supplement dated May 1, 2021 to the Prospectus dated May 1, 2021 for the
Pacific Choice Income, Pacific Journey Select (offered on or after October 1, 2013) and Pacific Odyssey (offered on or after October 1, 2013) individual flexible premium deferred variable annuity contracts issued by Pacific Life Insurance Company
Capitalized terms used in this supplement are defined in the Pacific Journey Select, Pacific Odyssey and Pacific Choice Income variable annuity contract prospectuses (“Prospectus”) unless otherwise defined herein. ‘‘We,’’ ‘‘us,’’ or ‘‘our’’ refer to Pacific Life Insurance Company; ‘‘you’’ or ‘‘your’’ refer to the Contract Owner.
This Rate Sheet Prospectus Supplement (“Supplement”) should be read, retained, and used in conjunction with the effective Prospectus and replaces and supersedes any previously issued Rate Sheet Prospectus Supplement. If you would like another copy of the current prospectus, you may obtain one by visiting www.PacificLife.com or by calling us at (800) 722-4448 to request a free copy. All Rate Sheet Prospectus Supplements are also available on the EDGAR system at www.sec.gov by typing in the variable annuity product name “Pacific Choice Income,” “Pacific Journey Select,” or “Pacific Odyssey” as applicable under EDGAR Search Tools - Variable Insurance Products.
We are issuing this Supplement to provide current rate information for the Annual Charge, Annual Credit, and Withdrawal Percentages for the Future Income Generator (Single) or (Joint) and the Annual Charge, Annual Credit, Enhanced Income and Guaranteed Lifetime Income percentages for the Enhanced Income Select 2 (Single) or (Joint) optional riders in effect on or after the date below. For complete information about the Future Income Generator (Single) or (Joint) or the Enhanced Income Select 2 (Single) or (Joint), see the Prospectus.
The percentages below apply for applications signed on or after May 1, 2021
This Supplement has no specified end date and can be superseded at any time subject to certain notice requirements. The rate information in this Supplement may not be superseded or changed until a new Supplement is filed at least 10 business days before the effective date of the new Supplement. Please work with your financial professional, visit www.PacificLife.com or call us at (800) 722-4448 to confirm the most current percentages.
The current Annual Charge and Annual Credit are the following:
Rider Name |
Annual Charge Percentage |
Annual Credit Percentage |
Future Income Generator (Single) |
1.35% |
5.0% |
Future Income Generator (Joint) |
1.45% |
5.0% |
Enhanced Income Select 2 (Single) |
1.35% |
5.0% |
Enhanced Income Select 2 (Joint) |
1.55% |
5.0% |
The current Withdrawal Percentages/Enhanced Income Percentages are the following:
Age* |
Future Income |
Future Income |
Enhanced Income Select 2 (Single) |
Enhanced Income Select 2 (Joint) |
Before 59½ |
0% |
0% |
0% |
0% |
59½ |
4.0% |
3.5% |
4.5% |
4.0% |
60 |
4.0% |
3.5% |
4.5% |
4.0% |
61 |
4.0% |
3.5% |
4.5% |
4.0% |
62 |
4.0% |
3.5% |
4.5% |
4.0% |
63 |
4.0% |
3.5% |
4.5% |
4.0% |
64 |
4.0% |
3.5% |
4.5% |
4.0% |
65 |
4.75% |
4.25% |
7.0% |
6.5% |
66 |
4.75% |
4.25% |
7.0% |
6.5% |
67 |
4.75% |
4.25% |
7.0% |
6.5% |
68 |
4.75% |
4.25% |
7.0% |
6.5% |
69 |
4.75% |
4.25% |
7.0% |
6.5% |
70 |
4.75% |
4.25% |
7.5% |
7.0% |
Age* |
Future Income |
Future Income |
Enhanced Income Select 2 (Single) |
Enhanced Income Select 2 (Joint) |
71 |
4.75% |
4.25% |
7.5% |
7.0% |
72 |
4.75% |
4.25% |
7.5% |
7.0% |
73 |
4.75% |
4.25% |
7.5% |
7.0% |
74 |
4.75% |
4.25% |
7.5% |
7.0% |
75 |
5.0% |
4.5% |
7.5% |
7.0% |
76 |
5.0% |
4.5% |
7.5% |
7.0% |
77 |
5.0% |
4.5% |
7.5% |
7.0% |
78 |
5.0% |
4.5% |
7.5% |
7.0% |
79 |
5.0% |
4.5% |
7.5% |
7.0% |
80 |
5.0% |
4.5% |
7.5% |
7.0% |
81 |
5.0% |
4.5% |
7.5% |
7.0% |
82 |
5.0% |
4.5% |
7.5% |
7.0% |
83 |
5.0% |
4.5% |
7.5% |
7.0% |
84 |
5.0% |
4.5% |
7.5% |
7.0% |
85 and older |
5.0% |
4.5% |
7.5% |
7.0% |
* The Age range that applies is based on the age of the Designated Life (Single) or the youngest Designated Life (Joint) at the time of the first withdrawal after age 59½ or the first withdrawal after an Automatic or Owner-Elected Reset occurs.
The current Guaranteed Lifetime Income Percentage is:
Age** |
Enhanced Income Select 2 (Single) |
Enhanced Income Select 2 (Joint) |
Before 59½ |
0% |
0% |
59½ and older |
3.0% |
3.0% |
** The Age range that applies based on the age of the Designated Life (Single) or the youngest Designated Life (Joint) at the time the Contract Value is reduced to zero.
In order for you to receive the percentages reflected above, your application must be signed on or after the date referenced above, your application must be received, In Proper Form, within 14 calendar days after the application sign date, and we must receive, In Proper Form, the initial Purchase Payment within 60 calendar days after the application sign date. Once the Rider is issued, your percentages will not change as long as you own the Rider (even if an Automatic Reset or Owner-Elected Reset occurs as described in the Reset of Protected Payment Base subsection within each Rider).
Subject to meeting the timelines referenced above, on the issue date, if during the 60 calendar day period current percentage rates have changed since the date you signed your application, the following will apply:
· If the Annual Credit Percentage increased, you will receive the higher percentage in effect on the issue date.
· If any Withdrawal Percentage or Enhanced Income Percentage increased, you will receive the higher percentages in effect on the issue date.
· If the Guaranteed Lifetime Income Percentage increased, you will receive the higher percentage in effect on the issue date.
· If the Annual Charge Percentage decreased, you will receive the lower percentage in effect on your issue date.
However, for the Future Income Generator, if the Annual Credit and/or any Withdrawal Percentage decreased, or the Annual Charge Percentage increased, you will receive the Annual Credit, Withdrawal and Annual Charge Percentages in effect on the date you signed your application. For the Enhanced Income Select 2, if the Annual Credit, any Enhanced Income Percentage and/or Guaranteed
Lifetime Income Percentage decreased, or the Annual Charge Percentage increased, you will receive the Annual Credit, Enhanced Income, Guaranteed Lifetime Income and Annual Charge Percentages in effect on the date you signed your application.
If the necessary paperwork and initial Purchase Payment are not received within the timeframes stated above, you will receive the applicable percentages in effect as of the Contract issue date.
If you purchased a Rider, review the Rate Sheet Prospectus Supplement provided to you at Contract issue, review the Rider specifications page you receive for your Contract, speak with your financial professional, or call us to confirm the percentages applicable to you.
Please work with your financial professional or call us at (800) 722-4448 prior to submitting your paperwork if you have any questions.
Form No. VARS0521B
PACIFIC CHOICE® INCOME PROSPECTUS MAY 1, 2021
Pacific Choice Income describes individual flexible premium deferred variable annuity contracts issued by Pacific Life Insurance Company (“Pacific Life”) through Separate Account A of Pacific Life. This variable annuity requires that you purchase one of the guaranteed minimum withdrawal benefit riders, at an additional cost, at the time you purchase this variable annuity. See the OVERVIEW – Living Benefit Riders section for a list of the guaranteed minimum withdrawal benefit riders currently available for purchase and OVERVIEW – Fees and Expenses for the maximum charge percentage associated with each rider. Work with your financial professional and together you can decide which guaranteed minimum withdrawal benefit rider you should select.
In this Prospectus, you and your mean the Contract Owner or Policyholder. Pacific Life, we, us and our refer to Pacific Life Insurance Company. Contract means a Pacific Choice Income variable annuity contract, unless we state otherwise.
This Prospectus provides information you should know before buying a Contract. Please read the Prospectus carefully, and keep it for future reference.
Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the shareholder reports for portfolio companies available under your Contract, will no longer be sent by mail, unless you specifically request copies of the reports from Pacific Life. Instead, the reports will be made available on a website, and you will be notified by mail each time a report is posted and provided with a website link to access the report.
If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications from Pacific Life electronically by indicating so on the application, at www.PacificLife.com, or by sending us instructions in writing in a form acceptable to us to receive such documents electronically.
You may elect to receive all future reports in paper free of charge. You can inform Pacific Life that you wish to continue receiving paper copies of your shareholder reports by calling (833) 455-0901 or visit www.PacificLife.com/PrintedShareholderReports. Your election to receive reports in paper will apply to all portfolio companies available under your Contract.
The Variable Investment Options available under this Contract invest in portfolios of the following portfolio companies (“Funds”):
AIM Variable Insurance Funds | Ivy Variable Insurance Portfolios Janus Aspen Series |
American Funds Insurance Series® | MFS® Variable Insurance Trust |
BlackRock® Variable Series Funds, Inc | Pacific Select Fund |
Fidelity® Variable Insurance Products Funds | State Street Variable Insurance Series Funds, Inc. |
First Trust Variable Insurance Trust | |
Franklin Templeton Variable Insurance Products Trust |
You will find a complete list of each Variable Investment Option on the next page. This Contract also offers the following:
FIXED OPTION
DCA Plus Fixed Option
You will find more information about the Contract and Separate Account A in the Statement of Additional Information (SAI) dated May 1, 2021. The SAI has been filed with the Securities and Exchange Commission (SEC) and is considered to be part of this Prospectus because it’s incorporated by reference. The contents of the SAI are described in this Prospectus after The General Account section – see the Table of Contents. You can get a copy of the SAI without charge by calling or writing to Pacific Life or you can visit our website at www.pacificlife.com. You can also visit the SEC’s website at www.sec.gov, which contains the SAI, material incorporated into this Prospectus by reference, and other information about registrants that file electronically with the SEC.
You should be aware that the SEC has not approved or disapproved of the securities or passed upon the accuracy or adequacy of the disclosure in this Prospectus. Any representation to the contrary is a criminal offense.
This Contract is not available in all states. This Prospectus is not an offer in any state or jurisdiction where we are not legally permitted to offer the Contract. This Contract is subject to availability, is offered at our discretion, and may be discontinued for purchase at any time. The Contract is described in detail in this Prospectus and its SAI. A Fund is described in its Prospectus and its SAI. No one has the right to describe the Contract or a Fund any differently than they have been described in these documents.
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This material is not intended to be used, nor can it be used by any taxpayer, for the purpose of avoiding U.S. federal, state or local tax penalties. Pacific Life, its distributors and their 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.
This Contract is not a deposit or obligation of, or guaranteed or endorsed by, any bank. It’s not federally insured by the Federal Deposit Insurance Corporation (FDIC), the Federal Reserve Board, or any other government agency. Investment in a Contract involves risk, including possible loss of principal.
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VARIABLE INVESTMENT OPTIONS
All available Variable Investment Options are allowable Investment Options for rider purposes. However, the Fidelity VIP Government Money Market is only available for investment by California applicants age 60 or older during the Right to Cancel “Free Look” period. The Fidelity VIP Government Money Market can also be used in the event an allowable Investment Option is liquidated by a Fund
AIM VARIABLE INSURANCE FUNDS (INVESCO VARIABLE INSURANCE FUNDS)
Invesco V.I. Balanced-Risk Allocation Fund Series II
AMERICAN FUNDS INSURANCE SERIES
American Funds IS Asset Allocation Fund Class 4
American Funds IS Managed Risk Asset Allocation Fund Class P2
BLACKROCK VARIABLE SERIES FUNDS, INC
BlackRock Global Allocation V.I. Fund Class III
FIDELITY® VARIABLE INSURANCE PRODUCTS FUNDS
Fidelity® VIP FundsManager® 60% Portfolio Service Class 2
Fidelity® VIP Government Money Market Portfolio Service Class
FIRST TRUST VARIABLE INSURANCE TRUST
First Trust/Dow Jones Dividend & Income Allocation Portfolio Class I
FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST
Franklin Allocation VIP Fund Class 4
IVY VARIABLE INSURANCE PORTFOLIOS
Ivy VIP Asset Strategy Class II
JANUS ASPEN SERIES
Janus Henderson Balanced Portfolio Service Shares
MFS VARIABLE INSURANCE TRUST
MFS® Total Return Series – Service Class
PACIFIC SELECT FUND
ESG Diversified Portfolio Class I
Hedged Equity Portfolio Class I
PSF DFA Balanced Allocation Portfolio Class D
Pacific Dynamix – Conservative Growth Portfolio Class I
Pacific Dynamix – Moderate Growth Portfolio Class I
Portfolio Optimization Conservative Portfolio Class I
Portfolio Optimization Moderate Portfolio Class I
Portfolio Optimization Moderate-Conservative Portfolio Class I
STATE STREET VARIABLE INSURANCE SERIES FUNDS, INC.
State Street Total Return V.I.S. Fund Class 3
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YOUR GUIDE TO THIS PROSPECTUS
Where To Go For More Information Back Cover
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Some of the terms we’ve used in this Prospectus may be new to you. We’ve identified them in the Prospectus by capitalizing the first letter of each word. You will find an explanation of what they mean below.
If you have any questions, please ask your financial professional or call us at (800) 722-4448. Financial professionals may call us at (800) 722-2333.
Account Value – The amount of your Contract Value allocated to a specified Variable Investment Option or any fixed option.
Annual Fee – A $50.00 fee charged each year on your Contract Anniversary and at the time of a full withdrawal (on a pro rated basis for that Contract year), if your Contract Value is less than $50,000 on that date.
Annuitant – A person on whose life annuity payments may be determined. An Annuitant’s life may also be used to determine death benefits, in the case of a Non-Natural Owner, and to determine the Annuity Date. A Contract may name a single (“sole”) Annuitant or two (“Joint”) Annuitants. You may choose a Contingent Annuitant only if you have a sole Annuitant (cannot have Joint Annuitants and a Contingent Annuitant at the same time). If you name Joint Annuitants or a Contingent Annuitant, “the Annuitant” means the sole surviving Annuitant, unless otherwise stated. See ADDITIONAL INFORMATION – State Considerations for Contracts issued in California.
Annuity Date – The date specified in your Contract, or the date you later elect, if any, for the start of annuity payments if the Annuitant (or Joint Annuitants) is (or are) still living and your Contract is in force; or if earlier, the date that annuity payments actually begin. The maximum Annuity Date is stated in your Contract and is the latest date on which we will begin paying you an annuity income.
Annuity Option – Any one of the income options available for a series of payments after your Annuity Date.
Beneficiary – A person who may have a right to receive any death benefit proceeds before the Annuity Date or any remaining annuity payments after the Annuity Date, if any Owner (or Annuitant in the case of a Non-Natural Owner) dies. See ADDITIONAL INFORMATION – State Considerations for Contracts issued in California.
Business Day – Any day on which the value of an amount invested in a Variable Investment Option is required to be determined, which currently includes each day that the New York Stock Exchange is open for trading, an applicable underlying Fund Portfolio is open for trading, and our administrative offices are open. The New York Stock Exchange and our administrative offices are closed on weekends and on the following holidays: New Year’s Day, Martin Luther King Jr. Day, President’s Day, Good Friday, Memorial Day, July Fourth, Labor Day, Thanksgiving Day and Christmas Day, and the Friday before New Year’s Day, July Fourth or Christmas Day if that holiday falls on a Saturday, the Monday following New Year’s Day, July Fourth or Christmas Day if that holiday falls on a Sunday, unless unusual business conditions exist, such as the ending of a monthly or yearly accounting period. An underlying Fund Portfolio may be closed when other federal holidays are observed such as Columbus Day and Veterans Day. See the underlying Fund Portfolio prospectus. In this Prospectus, “day” or “date” means Business Day unless otherwise specified. If any transaction or event called for under a Contract is scheduled to occur on a day that is not a Business Day, such transaction or event will be deemed to occur on the next following Business Day unless otherwise specified. Any systematic pre-authorized transaction scheduled to occur on December 30 or December 31 where that day is not a Business Day will be deemed an order for the last Business Day of the calendar year and will be calculated using the applicable Subaccount Unit Value at the close of that Business Day. Special circumstances such as leap years and months with fewer than 31 days are discussed in the SAI.
Code – The Internal Revenue Code of 1986, as amended.
Contingent Annuitant – A person, if named in your Contract, who will become your sole surviving Annuitant if your existing sole Annuitant should die before your Annuity Date. See ADDITIONAL INFORMATION – State Considerations for Contracts issued in California.
Contingent Beneficiary – A person, if any, you select to become the Beneficiary if the Beneficiary predeceases the Owner (or Annuitant in the case of a Non-Natural Owner).
Contract Anniversary – The same date, in each subsequent year, as your Contract Date.
Contract Date – The date we issue your Contract. Contract Years, Contract Anniversaries, Contract Semi-Annual Periods, Contract Quarters and Contract Months are measured from this date.
Contract Owner, Owner, Policyholder, you, or your – Generally, a person who purchases a Contract and makes the Investments. A Contract Owner has all rights in the Contract, including the right to make withdrawals, designate and change beneficiaries, transfer amounts among Investment Options, and designate an Annuity Option. If your Contract names Joint Owners, both Joint Owners are Contract Owners and share all such rights. Except in the case of a Non-Natural Owner, the Owner’s life is used to determine death benefits. See ADDITIONAL INFORMATION – State Considerations for Contracts issued in California.
Contract Value – As of the end of any Business Day, the sum of your Variable Account Value, any fixed option value, the value of any other Investment Option added to the Contract by Rider or Endorsement.
Contract Year – A year that starts on the Contract Date or on a Contract Anniversary.
DCA Plus Fixed Option – If you allocate all or part of your Purchase Payments to the DCA Plus Fixed Option, such amounts are held in our General Account and receive interest at rates declared periodically (the “Guaranteed Interest Rate”), but not less than the minimum guaranteed interest rate specified in your Contract. Currently, this fixed option may be used for dollar cost averaging of up to 24 months, depending on what Guarantee Terms we offer. Please contact us for the Guarantee Terms currently available.
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DCA Plus Fixed Option Value – The aggregate amount of your Contract Value allocated to the DCA Plus Fixed Option.
Earnings – As of the end of any Business Day, your Earnings equal your Contract Value less your aggregate Purchase Payments, which are reduced by withdrawals of prior Investments.
Fund – A registered open-end management investment company; collectively refers to AIM Variable Insurance Funds (Invesco Variable Insurance Funds), American Funds Insurance Series, BlackRock Variable Series Funds, Inc., Fidelity® Variable Insurance Products Fund, First Trust Variable Insurance Trust, Franklin Templeton Variable Insurance Products Trust, Ivy Variable Insurance Portfolios, Janus Aspen Series, MFS Variable Insurance Trust, Pacific Select Fund, and/or State Street Variable Insurance Series Funds, Inc.
General Account – Our General Account consists of all of our assets other than those assets allocated to Separate Account A or to any of our other separate accounts.
Guarantee Term – The period during which an amount you allocate to any available fixed option earns interest at a Guaranteed Interest Rate.
Guaranteed Interest Rate – The interest rate guaranteed at the time of allocation (or rollover) for the Guarantee Term on amounts allocated to a fixed option. All Guaranteed Interest Rates are expressed as annual rates and interest is accrued daily. The rate will not be less than the minimum guaranteed interest rate specified in your Contract.
In Proper Form – This is the standard we apply when we determine whether an instruction is satisfactory to us. An instruction (in writing or by other means that we accept (e.g. via telephone or electronic submission)) is considered to be in proper form if it is received at our Service Center in a manner that is satisfactory to us, such that is sufficiently complete and clear so that we do not have to exercise any discretion to follow the instruction, including any information and supporting legal documentation necessary to effect the transaction. Any forms that we provide will identify any necessary supporting documentation. We may, in our sole discretion, determine whether any particular transaction request is in proper form, and we reserve the right to change or waive any in proper form requirements at any time.
Investment (“Purchase Payment”) – An amount paid to us by or on behalf of a Contract Owner as consideration for the benefits provided under the Contract.
Investment Option – A Subaccount, any fixed option or any other Investment Option added to the Contract by Rider or Endorsement.
Joint Annuitant – If your Contract is a Non-Qualified Contract, you may name two Annuitants, called “Joint Annuitants,” in your application for your Contract. Special restrictions may apply for Qualified Contracts.
Non-Natural Owner – A corporation, trust or other entity that is not a (natural) person.
Non-Qualified Contract – A Contract other than a Qualified Contract.
Policyholder – The Contract Owner.
Portfolio – A separate portfolio of a Fund in which a Subaccount invests its assets.
Primary Annuitant – The individual that is named in your Contract, the events in the life of whom are of primary importance in affecting the timing or amount of the payout under the Contract.
Purchase Payment (“Investment”) – An amount paid to us by or on behalf of a Contract Owner as consideration for the benefits provided under the Contract.
Qualified Contract – A Contract that qualifies under the Code as an individual retirement annuity or account (IRA), or form thereof, or a Contract purchased by a Qualified Plan, qualifying for special tax treatment under the Code.
Qualified Plan – A retirement plan that receives favorable tax treatment under Section 401, 408, 408A or 457 of the Code.
SEC – Securities and Exchange Commission.
Separate Account A (the “Separate Account”) – A separate account of ours registered as a unit investment trust under the Investment Company Act of 1940, as amended (the “1940 Act”).
Subaccount – An investment division of the Separate Account. Each Subaccount invests its assets in shares of a corresponding Portfolio.
Subaccount Annuity Unit – Subaccount Annuity Units (or “Annuity Units”) are used to measure variation in variable annuity payments. To the extent you elect to convert all or some of your Contract Value into variable annuity payments, the amount of each annuity payment (after the first payment) will vary with the value and number of Annuity Units in each Subaccount attributed to any variable annuity payments. At annuitization (after any applicable premium taxes and/or other taxes are paid), the amount annuitized to a variable annuity determines the amount of your first variable annuity payment and the number of Annuity Units credited to your annuity in each Subaccount. The value of Subaccount Annuity Units, like the value of Subaccount Units, is expected to fluctuate daily, as described in the definition of Unit Value.
Subaccount Unit – Before your Annuity Date, each time you allocate an amount to a Subaccount, your Contract is credited with a number of Subaccount Units in that Subaccount. These Units are used for accounting purposes to measure your Account Value in that Subaccount. The value of Subaccount Units is expected to fluctuate daily, as described in the definition of Unit Value.
Unit Value – The value of a Subaccount Unit (“Subaccount Unit Value”) or Subaccount Annuity Unit (“Subaccount Annuity Unit Value”). Unit Value of any Subaccount is subject to change on any Business Day in much the same way that the value of a mutual fund share changes each day. The fluctuations in value reflect the investment results, expenses of and charges against the Portfolio in which the Subaccount invests its assets. Fluctuations also reflect charges against the Separate Account. Changes in Subaccount Annuity Unit Values also reflect an additional factor that adjusts Subaccount Annuity Unit Values to offset our Annuity Option Table’s implicit assumption of an annual
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investment return of 4%. The effect of this assumed investment return is explained in detail in the SAI. Unit Value of a Subaccount Unit or Subaccount Annuity Unit on any Business Day is measured as of the close of the New York Stock Exchange on that Business Day, which usually closes at 4:00 p.m., Eastern time, although it occasionally closes earlier.
Variable Account Value – The aggregate amount of your Contract Value allocated to all Subaccounts.
Variable Investment Option – A Subaccount (also called a Variable Account).
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This overview tells you some key things you should know about your Contract. It’s designed as a summary only – please read this Prospectus, your Contract and the Statement of Additional Information (SAI) for more detailed information.
Certain Contract features described in this Prospectus may vary or may not be available in your state. The state in which your Contract is issued governs whether or not certain features, Riders, charges or fees are allowed or will vary under your Contract. These variations are reflected in your Contract and in Riders or Endorsements to your Contract. See your financial professional or contact us for specific information that may be applicable to your state. You can find a description of all material state variations in the ADDITIONAL INFORMATION - State Considerations section. This prospectus provides a description of the material rights and obligations under the Contract. Any guarantees provided for under your Contract or through living benefit riders or optional death benefit riders are backed by Pacific Life’s financial strength and claims-paying ability. You must look to the strength of the insurance company with regard to such guarantees. Your financial professional or financial professional’s firm is not responsible for any Contract guarantees.
Some of the Terms used in this Prospectus may be new to you. You will find a glossary of certain terms in the TERMS USED IN THIS PROSPECTUS section.
Pacific Life is a variable annuity provider. It is not a fiduciary and therefore does not give advice or make recommendations regarding insurance or investment products.
Please be aware that the sale or liquidation of any stock, bond, IRA, certificate of deposit, mutual fund, annuity or other asset to fund the purchase of this product may have tax consequences, early withdrawal penalties or other costs or penalties as a result of the sale or liquidation. You may want to consult independent legal or financial advice before selling or liquidating any assets prior to the purchase of any life or annuity products.
Contract Basics
An annuity contract may be appropriate if you are looking for retirement income or you want to meet other long-term financial objectives. Discuss with your financial professional whether a variable annuity, a living benefit rider, an optional death benefit rider and which underlying Investment Options are appropriate for you, taking into consideration your age, income, net worth, tax status, insurance needs, financial objectives, investment goals, liquidity needs, time horizon, risk tolerance and other relevant information. Together you can decide if a variable annuity is right for you.
This Contract may not be the right one for you if you need to withdraw money for short-term needs, because withdrawal charges and tax penalties for early withdrawal may apply.
Additionally, since the benefits associated with the living benefit riders are not available until the Designated Life is 59½ years of age or older, early withdrawals may reduce or terminate the benefits associated with the riders.
You should consider the Contract’s investment and income benefits, as well as its costs.
This Contract is an annuity contract between you and Pacific Life. Annuity contracts have two phases, the accumulation phase and the annuitization phase. The two phases are discussed below.
This Contract is designed for long-term financial planning. It allows you to invest money on a tax-deferred basis for retirement or other goals, and/or to receive income in a variety of ways, including a series of income payments for life or for a specified period of years.
Non-Qualified and Qualified Contracts are available. You buy a Qualified Contract under a qualified retirement or pension plan, or some form of an individual retirement annuity or account (IRA). It is important to know that IRAs and qualified plans are already tax-deferred which means the tax deferral feature of a variable annuity does not provide a benefit in addition to that already offered by an IRA or qualified plan. An annuity contract should only be used to fund an IRA or qualified plan to benefit from the annuity’s features other than tax deferral.
This Contract is a variable annuity, which means that your Contract Value fluctuates depending on the performance of the Investment Options you choose. The Contract allows you to choose how often you make Investments (“Purchase Payments”) and how much you add each time, subject to certain limitations.
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You must purchase a guaranteed minimum withdrawal benefit rider at the time you purchase this Contract. The guaranteed minimum withdrawal benefit riders focus on providing an income stream for life through withdrawals during the accumulation phase, if certain conditions are met. See the OVERVIEW – Living Benefit Riders section for a list of the guaranteed minimum withdrawal benefit riders currently available for purchase with this Contract.
Your Right to Cancel (“Free Look”)
During the Free Look period, you have the right to cancel your Contract and return it with instructions to us or to your financial professional for a refund. Your Free Look period is usually the 10-calendar day period beginning on the calendar day you receive your Contract, but may vary if required by state law or if you are replacing another annuity contract or life insurance policy The amount refunded may be more or less than the Purchase Payments you have made. In most states, you will receive a refund of the Contract Value, plus any amounts deducted as fees or charges. If the Contract is issued in a state requiring a refund of Purchase Payments, or was issued as an IRA and is returned within 7 calendar days, you will receive the greater value of the Purchase Payments (less any withdrawals) or the Contract Value. You will find a complete description of the Free Look period that applies to your Contract on the Contract’s cover sheet. For more information about the Right to Cancel (“Free Look”) period see WITHDRAWALS – Right to Cancel (“Free Look”).
The Accumulation Phase
The Investment Options you choose and how they perform will affect your Contract Value during the accumulation phase, as well as the amount available to annuitize on the Annuity Date.
The accumulation phase begins on your Contract Date and continues until your Annuity Date. During the accumulation phase, you can put money in your Contract by making Purchase Payments subject to certain limitations, and choose Investment Options in which to allocate them. You can also take money out of your Contract by making a withdrawal.
Investments (“Purchase Payments”)
Your initial Purchase Payment must be at least $10,000 for a Non-Qualified Contract and at least $2,000 for a Qualified Contract. Additional Purchase Payments must be at least $250 for a Non-Qualified Contract and $50 for a Qualified Contract. Currently, we are not enforcing the minimum initial Purchase Payment on Qualified Contracts or the minimum additional Purchase Payment amounts on Qualified and Non-Qualified Contracts, but we reserve the right to enforce such minimums in the future. We will provide at least a 30 calendar day prior notice before we enforce the minimum initial Purchase Payment or the minimum additional Purchase Payment amounts.
We reserve the right to reject or restrict, at our discretion, any additional Purchase Payments for a rider. If we decide to no longer accept Purchase Payments for any rider, we will not accept subsequent Purchase Payments for your Contract, and you will not be able to increase your Contract Value or increase any protected amounts under your living benefit rider by making additional Purchase Payments into your Contract. We may reject or restrict additional Purchase Payments to help protect our ability to provide the guarantees under these riders (for example, changes in current economic factors or general market conditions). If we decide to no longer accept Purchase Payments, we will provide at least 30 calendar days advance written notice.
For more information about Making Your Investments (“Purchase Payments”) see PURCHASING YOUR CONTRACT – Making Your Investments (“Purchase Payments”).
Investment Options
Ask your financial professional to help you choose the right Investment Options for your goals and risk tolerance. Any financial firm or financial professional you engage to provide advice and/or make transfers for you is not acting on our behalf. We are not responsible for any investment decisions or allocations you make, recommendations such financial professionals make or any allocations or specific transfers they choose to make on your behalf. Some broker-dealers may not allow or may limit the amount you may allocate to certain Investment Options.
You can choose from a selection of Variable Investment Options (also called Subaccounts), each of which invests in a corresponding Fund Portfolio. The value of each Portfolio will fluctuate with the value of the investments it holds, and returns are not guaranteed.
You can also choose any available fixed option that earns a guaranteed rate of interest that will never be less than the minimum guaranteed interest rate specified in your Contract.
We allocate your Purchase Payments to the Investment Options you choose. Your Contract Value will fluctuate during the accumulation phase depending on the Investment Options you have chosen. You bear the investment risk of any Variable Investment Options you choose.
For more information about the Investment Options and the corresponding Investment Adviser see YOUR INVESTMENT OPTIONS – Your Variable Investment Options.
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Transferring Among Investment Options
You can transfer among Investment Options any time, subject to certain limitations, until your Annuity Date without paying any current income tax.
· Transfers are limited to 25 for each calendar year.
· Only 2 transfers in any calendar month may involve any of the following Investment Options:
BlackRock Global Allocation V.I. Fund | Fidelity® VIP FundsManager 60% Portfolio | First Trust/Dow Jones Dividend & Income Allocation Portfolio | Invesco V.I. Balanced-Risk Allocation Fund |
MFS Total Return Series | State Street Total Return V.I.S. Fund |
This restriction limits the total number of transfers involving any of the Investment Options in the group. For example, if you transfer from the MFS Total Return Series to the State Street Total Return V.I.S. Fund, that counts as one transfer for the calendar month. If you later transfer from the BlackRock Global Allocation V.I. Fund to the Invesco V.I. Balanced-Risk Allocation Fund, that would be the second transfer for the calendar month and no more transfers will be allowed for any of the Investment Options listed above for the remainder of the calendar month.
· Only 2 transfers into or out of each of the following Investment Options may occur in any calendar month:
American Funds IS Asset Allocation Fund | American Funds IS Managed Risk Allocation Fund |
This restriction limits the number of transfers involving any single Investment Option. For example, if you transfer from the American Funds IS Asset Allocation Fund to the American Funds IS Managed Risk Allocation Fund, that counts as one transfer for each Investment Option. Only one more transfer involving those two Investment Options can occur during the calendar month. If you later transfer from the Invesco V.I. Balanced-Risk Allocation Fund to the American Funds IS Asset Allocation Fund, that would be the second transfer in the calendar month involving the American Funds IS Asset Allocation Fund and that Investment Option is no longer available for the remainder of the calendar month. All other Investment Options listed above would still be available to transfer into or out of for the remainder of the calendar month.
· Transfers to or from a Variable Investment Option cannot be made before the seventh calendar day following the last transfer to or from the same Variable Investment Option. If the seventh calendar day is not a Business Day, then a transfer may not occur until the next Business Day. The day of the last transfer is not considered a calendar day for purposes of meeting this requirement.
You can also make systematic transfers by enrolling in our dollar cost averaging or portfolio rebalancing programs. Transfers made under these systematic transfer programs are excluded from these limitations. Some restrictions may apply to transfers to and from any fixed option.
For more information about transfers and transfer limitations see HOW YOUR PURCHASE PAYMENTS ARE ALLOCATED – Transfers and Market-timing Restrictions.
Withdrawals
You can make full and partial withdrawals to supplement your income or for other purposes. You can withdraw a certain amount each year without paying a withdrawal charge, but any amount withdrawn in excess of this amount may incur a withdrawal charge on Purchase Payments that are less than 8 years old. Some restrictions may apply to making partial withdrawals from any fixed option.
In general, you may have to pay income taxes on withdrawals or other distributions from your Contract. If you are under age 59½, a 10% federal tax penalty may also apply to taxable withdrawals.
For more information about withdrawals and withdrawal minimums see WITHDRAWALS – Optional Withdrawals.
The Annuitization Phase
The annuitization phase of your Contract begins on your Annuity Date. Generally, you can choose to surrender your Contract and receive a single payment or you can annuitize your Contract and receive a series of income payments over a fixed period or for life.
You can choose fixed or variable annuity payments, or a combination of both. You can choose monthly, quarterly, semi-annual or annual payments. We will make the income payments to you or your designated payee. The Owner is responsible for any tax consequences of any annuity payments.
If you choose variable annuity payments, the amount of the payments will fluctuate depending on the performance of the Variable Investment Options you choose. After your Annuity Date, if you choose variable annuity payments, you can exchange your Subaccount Annuity Units among the Variable Investment Options up to 4 times in any 12-month period.
For more information about annuitization see ANNUITIZATION and for annuity options available under the Contract see ANNUITIZATION – Choosing Your Annuity Option – Annuity Options.
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The Death Benefit
Generally, the Contract provides a death payout upon death of any Owner (or any Annuitant in the case of a Non-Natural Owner) during the accumulation phase. Death benefit proceeds are payable when we receive proof of death and payment instructions In Proper Form.
For more information about the death benefit see DEATH BENEFITS AND OPTIONAL DEATH BENEFIT RIDERS - Death Benefits. See ADDITIONAL INFORMATION – State Considerations for Contracts issued in California.
Riders
You must purchase a guaranteed minimum withdrawal benefit rider with this Contract. Riders are subject to availability (including state availability) and may be discontinued for purchase at any time. If we decide to discontinue offering a rider, we will amend this Prospectus. Before purchasing any Rider, make sure you understand all of the terms and conditions and consult with your financial professional for advice on whether a Rider is appropriate for you. You may elect the optional Return of Purchase Payments Death Benefit Rider (Return of Purchase Payments Death Benefit Rider II for Contracts issued in California) at the time your Contract is issued. No riders may be purchased after the Contract Date.
We reserve the right to reject or restrict, at our discretion, any additional Purchase Payments for a rider. If we decide to no longer accept Purchase Payments for any rider, we will not accept subsequent Purchase Payments for your Contract and you will not be able to increase your Contract Value or increase any protected amounts under your living benefit rider by making additional Purchase Payments into your Contract. We may reject or restrict additional Purchase Payments to help protect our ability to provide the guarantees under these riders (for example, changes in current economic factors or general market conditions). If we decide to no longer accept Purchase Payments, we will provide at least 30 calendar days advance written notice. See the Subsequent Purchase Payments subsection for any of the living benefit riders in the LIVING BENEFIT RIDERS section for additional information.
Optional Death Benefit Riders
Death benefit riders available through this Contract, for an additional cost, may be purchased at Contract Issue. The following is a list of riders currently available:
Return of Purchase Payments Death Benefit
This rider is not available for Contracts issued in California. See Return of Purchase Payments Death Benefit II below for Contracts issued in California.
This optional rider offers you the ability to have your Death Benefit Amount be the greater of the Contract Value or the Total Adjusted Purchase Payments as of the Notice Date. The Notice Date is the Business Day on which we receive, In Proper Form, proof of death and instructions regarding payment of any death benefit proceeds. There is a reset to the benefits provided under the rider when certain owner changes are made (see the Owner Change subsection of the rider for more information). You may not purchase this rider after the Contract Date.
For more information about the Return of Purchase Payments Death Benefit see DEATH BENEFITS AND OPTIONAL DEATH BENEFIT RIDERS – Return of Purchase Payments Death Benefit.
Return of Purchase Payments Death Benefit II
For Contracts issued in California, this optional rider offers you the ability to have your Death Benefit Amount be the greater of the Contract Value or the Total Adjusted Purchase Payments as of the Notice Date. The Notice Date is the Business Day on which we receive, In Proper Form, proof of death and instructions regarding payment of any death benefit proceeds. You may not purchase this rider after the Contract Date.
For more information about the Return of Purchase Payments Death Benefit II see DEATH BENEFITS AND OPTIONAL DEATH BENEFIT RIDERS – Return of Purchase Payments Death Benefit II.
Living Benefit Riders
You must purchase a living benefit rider at the time you submit your application. Living benefit riders available through this Contract, for an additional cost, are categorized as guaranteed minimum withdrawal benefit riders. The following is a list of riders currently available:
Guaranteed Minimum Withdrawal Benefit
· Future Income Generator (Single or Joint)
· Enhanced Income Select 2 (Single or Joint)
The guaranteed minimum withdrawal benefit riders focus on providing an income stream for life through withdrawals during the accumulation phase, if certain conditions are met. The riders vary in the percentage that may be withdrawn each year, how long the withdrawals may last (for example, for a single life or for joint lives), or if you can carry over any allowed withdrawal amounts not withdrawn in a prior Contract Year. The riders also offer the potential to lock in market gains on each Contract Anniversary which are
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used to calculate annual rider withdrawal limits. Such “locked-in” market gains are not added to the Contract Value, withdrawable as a lump sum, payable as a death benefit, or used in calculating any annuity option under the Contract before the maximum Annuity Date but may increase the annual amount you may withdraw each year under the rider. If the Designated Life (or youngest Designated Life for joint versions) is at or above age 59½, the riders provide an income stream regardless of market performance, even if your Contract Value is reduced to zero (such as through withdrawals (except Excess Withdrawals), fees, or market performance). If the Designated Life (youngest Designated Life for joint versions) is below age 59½ and your Contract Value goes to zero (such as through withdrawals, fees, or market performance), the rider will terminate without value and no further withdrawal may be made under the rider. Only one guaranteed minimum withdrawal benefit rider may be owned or in effect at the same time. See LIVING BENEFIT RIDERS – Guaranteed Minimum Withdrawal Benefit section for a comparison chart of some of the features for each rider.
Withdrawals made under the riders are from the Contract Owner’s Contract Value until the Contract Value goes to zero. We are only required to make lifetime income payments to the Contract Owner once the Contract Value is reduced to zero after the Designated Life reaches the age of 59 ½ (except due to Excess Withdrawals), which may never occur.
Additional Information Applicable to Living Benefit Riders
You can find more information about the costs associated with the living benefit riders within the next few pages and in the CHARGES, FEES AND DEDUCTIONS – Living Benefit Rider Charges section. You can find complete information about each rider and its key features and benefits in the LIVING BENEFIT RIDERS section.
You must purchase a living benefit rider at the time you submit your application. You can find complete purchasing and eligibility information about each living benefit rider in the Purchasing Your Rider subsection of each rider. See the LIVING BENFIT RIDERS section.
At initial purchase and during the entire time that you own a living benefit rider, you must invest your entire Contract Value in the Investment Options we make available for these riders. See LIVING BENEFIT RIDERS – General Information – Investment Allocation Requirements. Currently, there is no asset allocation model or program offered. We reserve the right to add an asset allocation model or program as an additional optional Investment Option in the future and add, remove or change Investment Options we make available for these riders at any time. We may make such a change due to a fund reorganization, fund substitution, to help protect our ability to provide the guarantees under these riders (for example, changes in an underlying portfolio’s investment objective and principal investment strategies, or changes in general market conditions), or otherwise. Generally, a change to an existing allowable Investment Option will not require you to reallocate or transfer the total amount of Contract Value allocated to an affected Investment Option, except when an underlying portfolio is liquidated by a determination of its Board of Directors or by a fund substitution. If a change is required that will result in a reallocation or transfer of an existing Investment Option, we will provide you with reasonable notice (generally 90 calendar days) prior to the effective date of such change to allow you to reallocate your Contract Value.
Distributions made due to a request for partial annuitization, divorce instructions or under Code Section 72(t)/72(q) (substantially equal periodic payments) are treated as withdrawals for Contract purposes and may adversely affect Rider benefits.
Taking a withdrawal before 59 ½, during the term which an annual credit may be applied, or a withdrawal that is greater than the annual withdrawal amount (“excess withdrawal”) under a particular rider may result in adverse consequences such as a permanent reduction in rider benefits, the failure to receive lifetime withdrawals under a Rider, or termination of the rider. If you would like to make an excess withdrawal and are uncertain how an excess withdrawal will reduce your future guaranteed withdrawal amounts, then you may contact us prior to requesting the withdrawal to obtain a personalized, transaction specific calculation showing the effect of the excess withdrawal.
The living benefit riders allow for owner elected Resets. If you elect to Reset, your election must be received, In Proper Form, within 60 calendar days after the Contract Anniversary (“60 calendar day period”) on which the Reset is effective. We may, at our sole discretion, allow Resets after the 60 calendar day period. We reserve the right to refuse a Reset request after the 60 calendar day period regardless of whether we may have allowed you or others to Reset in the past. Each Contract Anniversary starts a new 60 calendar day period in which a Reset may be elected.
Work with your financial professional to review the different riders available for purchase, how they function, how the riders differ from one another, and to understand all of the terms and conditions of a rider prior to purchase.
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Fees and Expenses
This section of the overview explains the fees and expenses that you will pay when buying, owning and surrendering your Contract.
Contract Transaction Expenses
The following describes the transaction fees and expenses that you may pay when you make withdrawals or surrender your Contract. Expenses are fixed under the terms of your Contract. Premium taxes and/or other taxes may also apply to your Contract. We generally charge state premium taxes and/or other taxes when you annuitize your Contract, but there are other times when we charge them to your Contract instead. For more information about these taxes, please see the CHARGES , FEES AND DEDUCTIONS—Premium Taxes section.
· Maximum Withdrawal Charge (as a percentage of Purchase Payments withdrawn)1
“Age” of Payment in Years: | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 or more |
Withdrawal Charge Percentage: | 9% | 8% | 7% | 6% | 5% | 4% | 3% | 0% |
Periodic Expenses
The following describes the fees and expenses that you will pay periodically during the time you own your Contract not including Portfolio fees and expenses.
· Annual Fee2 | $50.00 |
Separate Account A Annual Expenses (as a percentage of the average daily Variable Account Value3):
Without any | With Return of | ||
· Mortality and Expense Risk Charge4 | 0.90% | 0.90% | |
· Administrative Fee4 | 0.25% | 0.25% | |
· Death Benefit Rider Charge4, 5 | N/A | 0.15% | |
· Total Separate Account A Annual Expenses | 1.15% | 1.30% |
The Mortality and Expense Risk Charge and the Administrative Fee will not continue after the Annuity Date if fixed annuity payments are elected. If variable annuity payments are elected, both charges will continue after the Annuity Date. If you purchased an optional Death Benefit Rider, the charge will not continue after the Annuity Date, regardless of whether fixed or variable annuity payments are elected. For more information about these charges, please see the CHARGES, FEES AND DEDUCTIONS - Mortality and Expense Risk Charge and Optional Death Benefit Rider Charge and Administrative Fee sections.
Living Benefit Rider6 Annual Expenses:
Maximum Charge Percentage | |
Guaranteed Minimum Withdrawal Benefit7 Charge (as a percentage of the Protected Payment Base) | |
Future Income Generator Charge (Single) | 2.50% |
Future Income Generator Charge (Joint) | 2.75% |
Enhanced Income Select 2 Charge (Single) | 2.50% |
Enhanced Income Select 2 Charge (Joint) | 2.75% |
1 The withdrawal charge may or may not apply or may be reduced under certain circumstances. The age is measured from the date of each Purchase Payment. For situations where a withdrawal charge may not apply, see CHARGES, FEES AND DEDUCTIONS and see WITHDRAWALS – Withdrawals Free of a Withdrawal Charge for situations where the withdrawal charge amount may be reduced.
2 We deduct an Annual Fee on each Contract Anniversary up to your Annuity Date and when you make a full withdrawal if the Contract Value on these days is less than $50,000. See CHARGES, FEES AND DEDUCTIONS.
3 The Variable Account Value is the value of your Variable Investment Options on any Business Day.
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4 This is an annual rate and is assessed on a daily basis. The daily rate is calculated by dividing the annual rate by 365.
5 If you buy an optional death benefit rider, we will add this charge to the Mortality and Expense Risk Charge until, and including, your Annuity Date. Only one death benefit rider may be owned or in effect at the same time.
6 Only one guaranteed minimum withdrawal benefit rider may be owned or in effect at the same time.
7 The guaranteed minimum withdrawal benefit rider annual charge is deducted from your Contract Value on a quarterly basis. The quarterly charge is the charge percentage in effect for you (divided by 4) multiplied by the Protected Payment Base. The initial Protected Payment Base is equal to the initial Purchase Payment. For a complete explanation of the Protected Payment Base, see LIVING BENEFIT RIDERS and the applicable rider subsection. The quarterly amount deducted may increase or decrease due to changes in your Protected Payment Base. Your Protected Payment Base may increase due to additional Purchase Payments, increase due to Annual Credits, decrease due to withdrawals or also change due to Resets. We deduct the charge proportionately from your Investment Options (excluding the DCA Plus Fixed Option) every quarter following the Rider Effective Date, during the term of the rider and while the rider is in effect, and the date the rider is terminated. The charge may be waived under certain circumstances. See CHARGES, FEES, AND DEDUCTIONS – Living Benefit Rider Charges.
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Total Annual Fund Operating Expenses
For more about the underlying Funds see YOUR INVESTMENT OPTIONS – Your Variable Investment Options, and see each underlying Fund Prospectus.
This table shows the minimum and maximum total annual operating expenses incurred by the Portfolios that you indirectly pay during the time you own the Contract. This table shows the range (minimum and maximum) of fees and expenses (including management fees, shareholder servicing and/or distribution (12b-1) fees, and other expenses) charged by any of the Portfolios, expressed as an annual percentage of average daily net assets. The amounts are based on expenses paid in the year ended December 31, 2020, adjusted to reflect anticipated changes in fees and expenses, or, for new Portfolios, are based on estimates for the current fiscal year.
Each Variable Account of the Separate Account purchases shares of the corresponding Fund Portfolio at net asset value. The net asset value reflects the investment advisory fees and other expenses that are deducted from the assets of the Portfolio. The advisory fees and other expenses are not fixed or specified under the terms of the Contract, and they may vary from year to year. These fees and expenses are described in each Fund Prospectus.
Minimum | Maximum | |
Range of total annual portfolio operating expenses before any waivers or expense reimbursements | 0.62% | 1.69% |
Range of total annual portfolio operating expenses after any waivers or expense reimbursements | 0.59% | 1.20% |
To help limit Fund expenses, Fund advisers have contractually agreed to reduce investment advisory fees or otherwise reimburse certain Portfolios of their respective Funds which may reduce the Portfolio’s expenses. The range of expenses in the first row above does not include the effect of any waiver and/or expense reimbursement arrangement. The range of expenses in the second row above includes the effect of Fund waiver and/or expense reimbursement arrangements that are in effect. The waiver and/or reimbursement arrangements vary in length. There can be no assurance that Fund expense waivers or reimbursements will be extended beyond their current terms as outlined in each Fund prospectus, and they may not cover certain expenses such as extraordinary expenses. See each Fund prospectus for complete information regarding annual operating expenses and any waivers or reimbursements in effect for a particular Fund.
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Examples
The following examples are intended to help you compare the cost of investing in your Contract with the cost of investing in other variable annuity contracts. The maximum amounts reflected below include the maximum periodic Contract expenses, Contract Transaction Expenses, Separate Account annual expenses and the Portfolio with the highest fees and expenses for the year ended December 31, 2020. The maximum amounts also include the combination of living benefit and death benefit riders whose cumulative maximum charge expenses totaled more than any other rider combination. The Riders included are Return of Purchase Payments Death Benefit and the Future Income Generator (Joint). The minimum amounts reflected below include the minimum periodic Contract expenses, Separate Account annual expenses and the Portfolio with the lowest fees and expenses for the year ended December 31, 2020. The minimum amounts also include the charge for the least expensive living benefit rider, but do not include the optional death benefit rider.
The examples assume that you invest $10,000 in the Contract for the time periods indicated. They also assume that your Purchase Payment has a 5% return each year and assumes the maximum and minimum fees and expenses of all of the Investment Options available. Although your actual costs may be higher or lower, based on these assumptions, your maximum and minimum costs would be:
· If you surrendered your Contract:
1 Year | 3 Years | 5 Years | 10 Years | |
Maximum | $1,427 | $2,512 | $3,635 | $6,581 |
Minimum | $1,273 | $2,057 | $2,893 | $5,196 |
· If you annuitized your Contract:
1 Year | 3 Years | 5 Years | 10 Years | |
Maximum | $1,427 | $1,882 | $3,185 | $6,581 |
Minimum | $1,273 | $1,427 | $2,443 | $5,196 |
· If you did not surrender, annuitize, but left your money in your Contract:
1 Year | 3 Years | 5 Years | 10 Years | |
Maximum | $617 | $1,882 | $3,185 | $6,581 |
Minimum | $463 | $1,427 | $2,443 | $5,196 |
In calculating the examples above, we used the maximum and minimum total operating expenses of all the Portfolios as shown in the Fees And Expenses section of each Fund Prospectus. For more information on Contract fees and expenses, see CHARGES, FEES AND DEDUCTIONS in this Prospectus, and see each Fund Prospectus. See the FINANCIAL HIGHLIGHTS (Condensed Financial Information) appendix in this Prospectus for condensed financial information about the Subaccounts.
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Some broker-dealers may not allow or may limit the amount you may allocate to certain Investment Options. Work with your financial professional to help you choose the right Investment Options for your investment goals and risk tolerance.
You may choose among the different Variable Investment Options and the DCA Plus Fixed Option.
Your Variable Investment Options
We consider various factors when determining the Fund portfolios offered under this Contract. Such fund factors include some or all of the following: Fund reputation, asset class, investment objective, investment performance, manager and sub-adviser experience, brand recognition, portfolio share class, and portfolio expenses. We may also consider whether the underlying Fund makes fee payments for distribution and/or service fees (12b-1 fees), if a Fund affiliate makes fee payments for certain administrative support, or if the Fund is affiliated with us. See ADDITIONAL INFORMATION – Service Arrangements in this Prospectus and the underlying Fund prospectus for additional information.
We do not recommend or endorse any particular Fund and we do not provide investment advice.
Each Variable Investment Option invests in a separate Fund Portfolio. For your convenience, the following chart summarizes some basic data about each Portfolio. This chart is only a summary. For more complete information on each Portfolio, including a discussion of the Portfolio’s investment techniques and the risks associated with its investments, see the applicable Fund Prospectus. No assurance can be given that a Portfolio will achieve its investment objective. YOU SHOULD READ EACH FUND PROSPECTUS CAREFULLY BEFORE INVESTING. You can obtain a Fund prospectus by contacting your financial professional or by visiting www.PacificLife.com.
All available Variable Investment Options are allowable Investment Options for rider purposes. However, the Fidelity VIP Government Money Market is only available for investment by California applicants age 60 or older during the Right to Cancel “Free Look” period. The Fidelity VIP Government Money Market can also be used in the event an allowable Investment Option is liquidated by a Fund
AIM VARIABLE INSURANCE FUNDS (INVESCO VARIABLE INSURANCE FUNDS) | INVESTMENT GOAL | MANAGER/INVESTMENT ADVISER |
Invesco V.I. Balanced-Risk Allocation Fund Series II | Total return with a low to moderate correlation to traditional financial market indices. | Invesco Advisers, Inc. |
AMERICAN FUNDS INSURANCE SERIES | INVESTMENT GOAL | MANAGER/INVESTMENT ADVISER |
American Funds IS Asset Allocation Fund Class 4 | Provide high total return (including income and capital gains) consistent with preservation of capital over the long term. | Capital Research and Management CompanySM |
American Funds IS Managed Risk Asset Allocation Fund Class P2 | Provide high total return (including income and capital gains) consistent with preservation of capital over the long term while seeking to manage volatility and provide downside protection. | Capital Research and Management CompanySM |
BLACKROCK VARIABLE SERIES FUNDS, INC | INVESTMENT GOAL | MANAGER/INVESTMENT ADVISER |
BlackRock Global Allocation V.I. Fund Class III | Seeks high total investment return. | BlackRock Advisors, LLC |
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FIDELITY® VARIABLE INSURANCE PRODUCTS FUNDS | INVESTMENT GOAL | MANAGER/INVESTMENT ADVISER |
Fidelity® VIP FundsManager® 60% Portfolio Service Class 2 | Seeks high total return. | Fidelity Management & Research Co. LLC. |
Fidelity® VIP Government Money Market Portfolio Service Class* | Seeks as high a level of current income as is consistent with preservation of capital and liquidity. | Fidelity Management & Research Co. LLC |
* The Fidelity VIP Government Money Market is only available for investment by California applicants age 60 or older during the Right to Cancel “Free Look” period. The Fidelity VIP Government Money Market can also be used in the event an allowable Investment Option is liquidated by a Fund. | ||
FIRST TRUST VARIABLE INSURANCE TRUST | INVESTMENT GOAL | MANAGER/INVESTMENT ADVISER |
First Trust/Dow Jones Dividend & Income Allocation Portfolio Class I | Seeks to provide total return by allocating among dividend-paying stocks and investment grade bonds. | First Trust Advisors L.P. |
FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST | INVESTMENT GOAL | MANAGER/INVESTMENT ADVISER |
Franklin Allocation VIP Fund Class 4 | Seeks capital appreciation, with income as a secondary goal. | Franklin Advisers, Inc. |
IVY VARIABLE INSURANCE PORTFOLIOS | INVESTMENT GOAL | MANAGER/INVESTMENT ADVISER |
Ivy VIP Asset Strategy Class II | Seeks to provide total return. | Ivy Investment Management Company; on or about May 3, 2021, the investment adviser will change to Delaware Management Company |
JANUS ASPEN SERIES | INVESTMENT GOAL | MANAGER/INVESTMENT ADVISER |
Janus Henderson Balanced Portfolio Service Shares | Long-term capital growth, consistent with preservation of capital and balanced by current income. | Janus Capital Management LLC |
MFS VARIABLE INSURANCE TRUST | INVESTMENT GOAL | MANAGER/INVESTMENT ADVISER |
MFS® Total Return Series – Service Class | Seeks total return. | Massachusetts Financial Services Company |
PACIFIC SELECT FUND* | INVESTMENT GOAL | MANAGER/INVESTMENT ADVISER |
ESG Diversified Portfolio Class I | Seeks long-term growth of capital and low to moderate income, while giving consideration to certain environmental, social and governance (“ESG”) criteria. | Pacific Life Fund Advisors LLC |
Hedged Equity Portfolio Class I | Seeks to provide capital appreciation. | Pacific Life Fund Advisors LLC |
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PSF DFA Balanced Allocation Portfolio Class D | Seeks long-term growth of capital and low to moderate income | Pacific Life Fund Advisors LLC |
Pacific Dynamix – Conservative Growth Portfolio Class I | Seeks current income and moderate growth of capital. | Pacific Life Fund Advisors LLC |
Pacific Dynamix – Moderate Growth Portfolio Class I | Seeks long-term growth of capital and low to moderate income. | Pacific Life Fund Advisors LLC |
Portfolio Optimization Conservative Portfolio Class I | Seeks current income and preservation of capital. | Pacific Life Fund Advisors LLC |
Portfolio Optimization Moderate Portfolio Class I | Seeks long-term growth of capital and low to moderate income. | Pacific Life Fund Advisors LLC |
Portfolio Optimization Moderate-Conservative Portfolio Class I | Seeks current income and moderate growth of capital. | Pacific Life Fund Advisors LLC |
STATE STREET VARIABLE INSURANCE SERIES FUNDS, INC. | INVESTMENT GOAL | MANAGER/INVESTMENT ADVISER |
State Street Total Return V.I.S. Fund Class 3 | Highest total return, composed of current income and capital appreciation, as is consistent with prudent investment risk. | SSGA Funds Management, Inc. |
Your Fixed Option
The DCA Plus Fixed Option offers you a guaranteed minimum interest rate on amounts that you allocate to this option. You may only allocate Purchase Payments to the DCA Plus Fixed Option (you cannot make transfers from other Investment Options to the DCA Plus Fixed Option) and you may choose a Guarantee Term of up to 24 months, depending on what Guarantee Terms we offer. Please contact us for the Guarantee Terms currently available. Any amount allocated to this option will be transferred monthly (over the Guarantee Term) to one or more of the Variable Investment Option(s) you selected. You may also use the DCA Plus program, which invests in the DCA Plus Fixed Option, to transfer amounts to the allowable Investment Options to qualify for certain living benefit riders offered under your Contract. See LIVING BENEFIT RIDERS – Allowable Investment Options subsection and THE GENERAL ACCOUNT. Amounts you allocate to this option, and your earnings credited are held in our General Account. For more detailed information about this option, see THE GENERAL ACCOUNT.
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How to Apply for Your Contract
To purchase a Contract, you must purchase a living benefit rider and work with your financial professional to fill out an application and submit it along with your initial Purchase Payment to Pacific Life Insurance Company at P.O. Box 2290, Omaha, Nebraska 68103-2290. In those instances when we receive electronic transmission of the information on the application from your financial professional’s broker-dealer firm and our administrative procedures with your broker-dealer so provide, we consider the application to be received on the Business Day we receive the transmission. If your application and Purchase Payment are complete when received, or once they have become complete, we will issue your Contract within 2 Business Days. If some information is missing from your application, we may delay issuing your Contract while we obtain the missing information. However, we will not hold your initial Purchase Payment for more than 5 Business Days without your permission. In any case, we will not hold your initial Purchase Payment after 20 Business Days.
You may also purchase a Contract by exchanging your existing annuity. Some financial professionals may have a financial incentive to offer you this Contract in place of the one you already own. You should only exchange your existing contract for this Contract if you determine, after comparing the features, fees, and risks of both contracts, that it is preferable for you to purchase this Contract rather than continue your existing contract. Call your financial professional or call us at (800) 722-4448 if you are interested in this option. Financial professionals may call us at (800) 722-2333.
We reserve the right to reject any application or Purchase Payment for any reason, subject to any applicable nondiscrimination laws and to our own standards and guidelines. On your application, you must provide us with a valid U.S. tax identification number for federal, state, and local tax reporting purposes.
The maximum age of a Contract Owner/Annuitant, including Joint Owners, Joint Annuitants, and Contingent Annuitants, for which a Contract will be issued is 85. The Contract Owner’s age is calculated as of his or her last birthday. If any Contract Owner (or any Annuitant in the case of a Non-Natural Owner) named in the application for a Contract dies and we are notified of the death before we issue the Contract, then we will return the amount we received. If we issue the Contract and are subsequently notified after issuance that the death occurred prior to issue, then the application for the Contract and/or any Contract issued will be deemed cancelled and a refund will be issued. The refund amount will be the Contract Value based upon the next determined Accumulated Unit Value (AUV) after we receive proof of death, In Proper Form, of the Contract Owner (or Annuitant in the case of a Non-Natural Owner), plus a refund of any amount used to pay premium taxes and/or any other taxes. Any refunded assets may be subject to probate. See ADDITIONAL INFORMATION – State Considerations for Contracts issued in California.
Making Your Investments (“Purchase Payments”)
Making Your Initial Purchase Payment
Your initial Purchase Payment must be at least $10,000 for a Non-Qualified Contract and at least $2,000 for a Qualified Contract. Currently, we are not enforcing the minimum initial Purchase Payment on Qualified Contracts but we reserve the right to enforce the minimum initial Purchase Payment on Qualified Contracts in the future. We will provide at least a 30 calendar day prior notice before we enforce the minimum initial Purchase Payment on Qualified Contracts. For Non-Qualified Contracts, if the entire minimum initial Purchase Payment is not included when you submit your application, you must establish a pre-authorized investment program. A pre-authorized investment program allows you to pay the remainder of the required initial Purchase Payment in equal installments over the first Contract Year. Further requirements for the pre-authorized investment program are discussed in the Pre-Authorized Investment Request form.
We reserve the right to reject additional Purchase Payments. You must obtain our consent before making an initial or additional Purchase Payment that will bring your aggregate Purchase Payments over $1,000,000. For purposes of this limit, the aggregate purchase payments are based on all contracts for which you are either owner and/or annuitant.
Making Additional Purchase Payments
If your Contract is Non-Qualified, you may choose to invest additional amounts in your Contract at any time. If your Contract is Qualified, the method of contribution and contribution limits may be restricted by the Qualified Plan or the Internal Revenue Code (“the Code”). Each additional Purchase Payment must be at least $250 for a Non-Qualified Contract and $50 for a Qualified Contract. Currently, we are not enforcing the minimum additional Purchase Payment amounts but we reserve the right to enforce the minimum additional Purchase Payment amounts in the future. We will provide at least a 30 calendar day prior notice before we enforce the minimum additional Purchase Payment amounts. Additional Purchase Payments will be allocated according to the instructions we have on file unless we receive specific allocation instructions.
We reserve the right to reject or restrict, at our discretion, any additional Purchase Payments for a rider. If we decide to no longer accept Purchase Payments for any rider, we will not accept subsequent Purchase Payments for your Contract and you will not be able to increase your Contract Value or increase any protected amounts under your living benefit rider by making additional Purchase Payments into your Contract. We may reject or restrict additional Purchase Payments to help protect our ability to provide the guarantees under these riders (for example, changes in current economic factors or general market conditions). If we decide to no longer accept Purchase Payments, we will provide at least 30 calendar days advance written notice.
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Forms of Purchase Payment
Your initial and additional Purchase Payments may be sent by personal or bank check or by wire transfer. Purchase Payments must be made in a form acceptable to us before we can process it. Acceptable forms of Purchase Payments are:
· personal checks or cashier’s checks drawn on a U.S. bank,
· money orders and traveler’s checks in single denominations of more than $10,000 if they originate in a U.S. bank,
· third party payments when there is a clear connection of the third party to the underlying transaction, and
· wire transfers that originate in U.S. banks.
We will not accept Purchase Payments in the following forms:
· cash,
· credit cards or checks drawn against a credit card account,
· money orders or traveler’s checks in single denominations of $10,000 or less,
· starter checks,
· home equity checks,
· eChecks,
· cashier’s checks, money orders, traveler’s checks or personal checks drawn on non-U.S. banks, even if the payment may be effected through a U.S. bank,
· third party payments if there is not a clear connection of the third party to the underlying transaction, and
· wire transfers that originate from foreign bank accounts.
All unacceptable forms of Purchase Payments will be returned to the payor along with a letter of explanation. We reserve the right to reject or accept any form of payment. Any unacceptable Purchase Payment inadvertently invested may be returned and the amount returned may be more or less than the amount submitted. If a Purchase Payment is made by check other than a cashier’s check, we may hold the check and the payment of any withdrawal proceeds and any refund during the “Right to Cancel” period may be delayed until we receive confirmation in our Service Center that your check has cleared. In general, a delay of the payment of withdrawal proceeds or any refund during the check hold period will not exceed ten Business Days after we receive your withdrawal or “Right to Cancel” request In Proper Form. We will calculate the value of your proceeds as of the end of the Business Day we received your withdrawal or “Right to Cancel” request In Proper Form.
HOW YOUR PURCHASE PAYMENTS ARE ALLOCATED
Choosing Your Investment Options
You may allocate your Purchase Payments among any of the available Investment Options we make available for the living benefit riders. Allocations of your initial Purchase Payment to the Investment Options you selected will be effective on your Contract Date. Each additional Purchase Payment will be allocated to the Investment Options according to your allocation instructions in your application, or most recent instructions, if any, subject to the terms described in WITHDRAWALS – Right to Cancel (“Free Look”). If you purchased an optional living benefit rider, you must allocate your entire Contract Value to the allowable Investment Options made available for these riders. You may also use the DCA Plus program to transfer amounts to Allowable Investment Options. We reserve the right to require that your allocation to any particular Investment Option must be at least $500. We also reserve the right, with prior written notice, to transfer any remaining Account Value that is not at least $500 to your other Investment Options on a pro rata basis relative to your most recent allocation instructions.
If your Contract is issued in exchange for another annuity contract or a life insurance policy, our administrative procedures may vary depending on the state in which your Contract is delivered.
Investing in Variable Investment Options
Each time you allocate your Purchase Payment to a Variable Investment Option, your Contract is credited with a number of “Subaccount Units” in that Subaccount. The number of Subaccount Units credited is equal to the amount you have allocated to that Subaccount, divided by the “Unit Value” of one Unit of that Subaccount.
Example: You allocate $600 to Subaccount A. At the end of the Business Day on which your allocation is effective, the value of one Unit in Subaccount A is $15. As a result, 40 Subaccount Units are credited to your Contract for your $600 ($600 / $15 = 40).
Your Variable Account Value Will Change
After we credit your Contract with Subaccount Units, the value of those Units will usually fluctuate. This means that, from time to time, your Purchase Payments allocated to the Variable Investment Options may be worth more or less than the original Purchase
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Payments to which those amounts can be attributed. Fluctuations in Subaccount Unit Value will not change the number of Units credited to your Contract.
Subaccount Unit Values will vary in accordance with the investment performance of the corresponding Portfolio. For example, the value of Units in Subaccount A will change to reflect the performance of the corresponding Portfolio (including that Portfolio’s investment income, its capital gains and losses, and its expenses). Subaccount Unit Values are also adjusted to reflect the Administrative Fee and applicable Risk Charge imposed on the Separate Account.
We calculate the value of all Subaccount Units on each Business Day.
Calculating Subaccount Unit Values
We calculate the Unit Value of the Subaccount Units in each Variable Investment Option at the close of the New York Stock Exchange which usually closes at 4:00 p.m. Eastern Time on each Business Day. At the end of each Business Day, the Unit Value for a Subaccount is equal to:
Y × Z
where (Y) = the Unit Value for that Subaccount as of the end of the preceding Business Day; and
(Z) = the Net Investment Factor for that Subaccount for the period (a “valuation period”) between that Business Day and the immediately preceding Business Day.
The “Net Investment Factor” for a Subaccount for any valuation period is equal to:
(A ÷ B) - C
where (A) = the “per share value of the assets” of that Subaccount as of the end of that valuation period, which is equal to: a + b + c
(a) = the net asset value per share of the corresponding Portfolio shares held by that Subaccount as of the end of that valuation period;
(b) = the per share amount of any dividend or capital gain distributions made by each Fund for that Portfolio during that valuation period; and
(c) = any per share charge (a negative number) or credit (a positive number) for any income taxes and/or any other taxes or other amounts set aside during that valuation period as a reserve for any income and/or any other taxes which we determine to have resulted from the operations of the Subaccount or Contract, and/or any taxes attributable, directly or indirectly, to Purchase Payments;
(B) = the net asset value per share of the corresponding Portfolio shares held by the Subaccount as of the end of the preceding valuation period; and
(C) = a factor that assesses against the Subaccount net assets for each calendar day in the valuation period the Risk Charge plus the Administrative Fee and any applicable increase in the Risk Charge (see CHARGES, FEES AND DEDUCTIONS).
The Subaccount Unit Value may increase or decrease from one valuation period to another. For Subaccount Unit Values please go to www.PacificLife.com.
When Your Purchase Payment is Effective
Your initial Purchase Payment is effective on the Business Day we issue your Contract. Any additional Purchase Payment is effective on the Business Day we receive it In Proper Form. See ADDITIONAL INFORMATION – Inquiries and Submitting Forms and Requests.
The day your Purchase Payment is effective determines the Unit Value at which Subaccount Units are attributed to your Contract. In the case of transfers or withdrawals, the effective day determines the Unit Value at which affected Subaccount Units are debited and/or credited under your Contract. That Unit Value is the value of the Subaccount Units next calculated after your transaction is effective. Your Variable Account Value begins to reflect the investment performance results of your new allocations on the day after your transaction is effective.
Transfers and Market-timing Restrictions
Transfers
Transfers are allowed 30 calendar days after the Contract Date. Currently, we are not enforcing this restriction but we reserve the right to enforce it in the future. We will provide at least a 30 calendar day prior notice before we enforce the 30 calendar day waiting period after the Contract Date. Once your Purchase Payments are allocated to the Investment Options you selected, you may transfer your Account Value from any Investment Option to any other Investment Option, except the DCA Plus Fixed Option. If you purchased an optional living benefit rider, you may only transfer your Account Value to an allowable Investment Option made available for the riders or your rider will terminate. See the LIVING BENEFIT RIDERS – Investment Allocation Requirements subsection.
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· Transfers are limited to 25 for each calendar year. If you have used all 25 transfers available to you in a calendar year, you may no longer make transfers between the Investment Options until the start of the next calendar year.
· Only 2 transfers in any calendar month may involve any of the following Investment Options:
BlackRock Global Allocation V.I. Fund | Fidelity® VIP FundsManager 60% Portfolio | First Trust/Dow Jones Dividend & Income Allocation Portfolio | Invesco V.I. Balanced-Risk Allocation Fund |
MFS Total Return Series | State Street Total Return V.I.S. Fund |
This restriction limits the total number of transfers involving any of the Investment Options in the group. For example, if you transfer from the MFS Total Return Series to the State Street Total Return V.I.S. Fund, that counts as one transfer for the calendar month. If you later transfer from the BlackRock Global Allocation V.I. Fund to the Invesco V.I. Balanced-Risk Allocation Fund, that would be the second transfer for the calendar month and no more transfers will be allowed for any of the Investment Options listed above for the remainder of the calendar month.
· Only 2 transfers into or out of each of the following Investment Options may occur in any calendar month:
American Funds IS Asset Allocation Fund | American Funds IS Managed Risk Allocation Fund |
This restriction limits the number of transfers involving any single Investment Option. For example, if you transfer from the American Funds IS Asset Allocation Fund to the American Funds IS Managed Risk Allocation Fund, that counts as one transfer for each Investment Option. Only one more transfer involving those two Investment Options can occur during the calendar month. If you later transfer from the Invesco V.I. Balanced-Risk Allocation Fund to the American Funds IS Asset Allocation Fund, that would be the second transfer in the calendar month involving the American Funds IS Asset Allocation Fund and that Investment Option is no longer available for the remainder of the calendar month. All other Investment Options listed above would still be available to transfer into or out of for the remainder of the calendar month.
· Transfers to or from a Variable Investment Option cannot be made before the seventh calendar day following the last transfer to or from the same Variable Investment Option. If the seventh calendar day is not a Business Day, then a transfer may not occur until the next Business Day. The day of the last transfer is not considered a calendar day for purposes of meeting this requirement. For example, if you make a transfer into the Janus Henderson Balanced Portfolio Investment Option on Monday, you may not make any transfers to or from that Variable Investment Option before the following Monday.
For the purpose of applying the limitations, multiple transfers that occur on the same calendar day are considered 1 transfer. Transfers that occur as a result of the DCA Plus program, the dollar cost averaging program, the portfolio rebalancing program, or approved corporate owned life insurance policy rebalancing programs are excluded from these limitations. Also, allocations of Purchase Payments are not subject to these limitations.
There are no exceptions to the above transfer limitations in the absence of an error, a substitution of Investment Options, reorganization of underlying Portfolios, or other extraordinary circumstances.
If we deny a transfer request, we will notify you or your financial professional immediately.
Certain restrictions apply to any available fixed option. See THE GENERAL ACCOUNT. Transfer requests are generally effective on the Business Day we receive them In Proper Form, unless you request a systematic transfer program with a future date.
We have the right, at our option (unless otherwise required by law), to require certain minimums in the future in connection with transfers. These may include a minimum transfer amount and a minimum Account Value, if any, for the Investment Option from which the transfer is made or to which the transfer is made. If your transfer request results in your having a remaining Account Value in an Investment Option that is less than $500 immediately after such transfer, we may (with prior written notice)transfer that Account Value to your other Investment Options on a pro rata basis, relative to your most recent allocation instructions.
We reserve the right (unless otherwise required by law) to limit the size of transfers, to restrict transfers, to require that you submit any transfer requests in writing, to suspend transfers, and to impose further limits on the number and frequency of transfers you can make. We also reserve the right to reject any transfer request. Any policy we may establish with regard to the exercise of any of these rights will be applied uniformly to all Contract Owners.
Market-timing Restrictions
The Contract is not designed to serve as a vehicle for frequent trading in response to short-term fluctuations in the market. Accordingly, organizations or individuals that use market-timing investment strategies and make frequent transfers should not purchase the Contract. Such frequent trading can disrupt management of the underlying Portfolios and raise expenses. The transfer limitations set forth above are intended to reduce frequent trading. As required by SEC regulation (Rule 22c-2 of the 1940 Act), we entered into written agreements with each Fund or its principal underwriter that require us to provide to a Fund, upon Fund request, certain information about the trading activity of individual Contract Owners. The agreement requires us to execute any Fund instructions we receive that restrict or prohibit further purchases or transfers by specific Contract Owners who violate the frequent
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trading or market timing policies established by a Fund. The policies of a Fund may be more restrictive than our policies or the policies of other Funds. See the Fund prospectuses for additional information.
In addition, we monitor certain large transaction activity in an attempt to detect trading that may be disruptive to the Portfolios. In the event transfer activity is found to be disruptive, certain future transactions by such Contract Owners, or by a financial professional or other party acting on behalf of one or more Contract Owners, will require preclearance. Frequent trading and large transactions that are disruptive to Portfolio management can have an adverse effect on Portfolio performance and therefore your Contract’s performance. Such trading may also cause dilution in the value of the Investment Options held by long-term Contract Owners. While these issues can occur in connection with any of the underlying Portfolios, Portfolios holding securities that are subject to market pricing inefficiencies are more susceptible to abuse. For example, Portfolios holding international securities may be more susceptible to time-zone arbitrage which seeks to take advantage of pricing discrepancies occurring between the time of the closing of the market on which the security is traded and the time of pricing of the Portfolios.
Our policies and procedures which limit the number and frequency of transfers and which may impose preclearance requirements on certain large transactions are applied uniformly to all Contract Owners. However, there is a risk that these policies and procedures will not detect all potentially disruptive activity or will otherwise prove ineffective in whole or in part. Further, we and our affiliates make available to our variable annuity and variable life insurance Contract Owners underlying funds not affiliated with us. We are unable to monitor or restrict the trading activity with respect to shares of such funds not sold in connection with our Contracts. In the event the Board of Trustees/Directors of any underlying fund imposes a redemption fee or trading (transfer) limitations, we will pass them on to you.
We reserve the right to restrict, in our sole discretion, transfers initiated by a market timing organization or individual or other party authorized to give transfer instructions on behalf of multiple Contract Owners. Such restrictions could include:
· not accepting transfer instructions from a financial professional acting on behalf of more than one Contract Owner, and
· not accepting preauthorized transfer forms from market timers or other entities acting on behalf of more than one Contract Owner at a time.
We further reserve the right to impose, with 30 calendar days advance written notice, restrictions on transfers that we determine, in our sole discretion, will disadvantage or potentially hurt the rights or interests of other Contract Owners; or to comply with any applicable federal and state laws, rules and regulations.
Exchanges of Annuity Units
Exchanges of Annuity Units in any Subaccount(s) to any other Subaccount(s) after the Annuity Date are limited to 4 in any 12-month period. For purposes of applying the limitations, multiple exchanges that occur on the same calendar day are considered 1 exchange. See THE GENERAL ACCOUNT section in this Prospectus and THE CONTRACTS AND THE SEPARATE ACCOUNT section in the SAI.
We offer 3 systematic transfer options: dollar cost averaging, DCA Plus, and portfolio rebalancing. There is no charge for these options and transfers under these options are not counted towards your total transfers in a calendar year. You can have only one DCA Plus or dollar cost averaging program in effect at one time.
Dollar Cost Averaging
Dollar cost averaging is a method in which you buy securities in a series of regular purchases instead of in a single purchase. This allows you to average the securities’ prices over time, and may permit a “smoothing” of abrupt peaks and drops in price. Prior to your Annuity Date, you may use dollar cost averaging to transfer amounts, over time, from any Investment Option with an Account Value of at least $5,000 to one or more Variable Investment Options. Each transfer must be for at least $250. Currently, we are not enforcing the minimum Account Value and/or transfer amounts but we reserve the right to enforce such minimum amounts in the future. Detailed information appears in the SAI. We will provide you at least 30 calendar days prior notice before we enforce the minimum Account Value and/or transfer amounts on dollar cost averaging purchases.
DCA Plus
DCA Plus provides a way to transfer amounts monthly from the DCA Plus Fixed Option to one or more Variable Investment Option(s) currently over a period of up to 24 months, depending on what Guarantee Terms we offer. Please contact us for the Guarantee Terms currently available. The initial minimum amount that you may allocate to the DCA Plus Fixed Option is $5,000. The minimum amount for subsequent Purchase Payments is $250. Currently, we are not enforcing the initial or subsequent Purchase Payment minimum amounts but we reserve the right to enforce such minimum amounts in the future. We will provide at least a 30 calendar day prior notice before we enforce the initial or subsequent Purchase Payment minimum amounts. Amounts allocated to the DCA Plus Fixed Option are held in our General Account and receive interest at rates declared periodically by us, but not less than the minimum guaranteed interest rate specified in your Contract (the “Guaranteed Interest Rate”). The DCA Plus program can also be used with allowable Investment Options to qualify for certain living benefit riders offered under your Contract. See THE GENERAL ACCOUNT.
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Portfolio Rebalancing
You may instruct us to maintain a specific balance of Variable Investment Options under your Contract (e.g. 30% in Subaccount A, 40% in Subaccount B, and 30% in Subaccount C). Periodically, we will “rebalance” your values in the elected Subaccounts to the percentages you have specified. Rebalancing may result in transferring amounts from a Subaccount earning a relatively higher return to one earning a relatively lower return. You may choose to have rebalances made quarterly, semi-annually or annually until your Annuity Date. Only Variable Investment Options are available for rebalancing. Detailed information appears in the SAI.
No front-end sales charge is imposed on any Purchase Payment which means the entire amount of your Purchase Payment is allocated to the Investment Options you selected. Your Purchase Payments may, however, be subject to a withdrawal charge. This charge may apply to amounts you withdraw under your Contract prior to the Annuity Date, depending on the length of time each Purchase Payment has been invested and on the amount you withdraw. This amount is deducted proportionately among all Investment Options from which the withdrawal occurs. See the Choosing Your Annuity Option – Annuity Options section for withdrawal charges that may apply to redemptions after the Annuity Date. No withdrawal charge is imposed on:
· the free withdrawal amount (see WITHDRAWALS – Withdrawals Free of a Withdrawal Charge),
· the maximum annual withdrawal amount allowed under a living benefit rider (see LIVING BENEFIT RIDERS),
· death benefit proceeds, except as provided under the DEATH BENEFITS AND OPTIONAL DEATH BENEFIT RIDERS – Non- Natural Owner section for certain Non-Natural Owners,
· amounts converted after the 1st Contract Anniversary to an Annuity Option (see ANNUITIZATION – Choosing Your Annuity Option), unless guaranteed variable annuity payments under Annuity Option 2 or 4 are subsequently redeemed (see ANNUITIZATION – Choosing Your Annuity Option),
· withdrawals by Owners to meet the minimum distribution rules for Qualified Contracts as they apply to amounts held under the Contract,
· withdrawals after the 1st Contract Anniversary, if the Owner (or Annuitant in the case of a Non-Natural Owner) has been diagnosed on or after the Contract Date with a medically determinable condition that results in a life expectancy of 12 months or less and we are provided with medical evidence In Proper Form, or
· subject to medical evidence provided In Proper Form, after 90 calendar days from the Contract Date, full or partial withdrawals while the Owner (or Annuitant in the case of a Non-Natural Owner) has been confined to an accredited nursing home for 30 calendar days or longer and was not confined to the nursing home on the Contract Date. See ADDITIONAL INFORMATION – State Considerations.
The nursing home waiver applies only to withdrawals made while the Owner (or Annuitant in the case of a Non-Natural Owner) is in a nursing home or within 90 calendar days after the Owner (or Annuitant in the case of a Non-Natural Owner) leaves the nursing home. In addition, the nursing home confinement period for which you seek the waiver must begin after the Contract Date. In order to use this waiver, you must submit with your withdrawal request the following documents:
· an admittance form which shows the type of facility the Owner (or Annuitant in the case of a Non-Natural Owner) entered, and
· a bill from the nursing home which shows that the Owner (or Annuitant in the case of a Non-Natural Owner) met the 30 calendar day nursing home confinement requirement.
An accredited nursing home is defined as a home or facility that:
· is operating in accordance with the law of jurisdiction in which it is located,
· is primarily engaged in providing, in addition to room and board, skilled nursing care under the supervision of a duly licensed physician, and
· provides continuous 24 hour a day nursing service by or under the supervision of a registered nurse, and maintains a daily record of the patient.
Transfers of all or part of your Account Value from one Investment Option to another are not considered a withdrawal of an amount from your Contract, so no withdrawal charge is imposed at the time of transfer. See HOW YOUR INVESTMENTS ARE ALLOCATED – Transfers and Market-timing Restrictions and THE GENERAL ACCOUNT.
How the Withdrawal Charge is Determined
The amount of the withdrawal charge depends on how long each Purchase Payment was held under your Contract. Each Purchase Payment you make is considered to have a certain “age,” depending on the length of time since that Purchase Payment was effective. A Purchase Payment is “one year old” or has an “age of one” from the day it is effective until the day preceding your next Contract
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Anniversary. Beginning on the day preceding your next Contract Anniversary, your Purchase Payment will have an “age of two” and increases in age on the day preceding each Contract Anniversary. When you withdraw an amount subject to the withdrawal charge, the “age” of the Purchase Payment you withdraw determines the level of withdrawal charge as follows:
“Age” of Payment in Years: | Withdrawal Charge as a Percentage of the Purchase Payment Withdrawn | ||
1 | 9% | ||
2 | 8% | ||
3 | 7% | ||
4 | 6% | ||
5 | 5% | ||
6 | 4% | ||
7 | 3% | ||
8 or more | 0% |
We calculate your withdrawal charge by assuming that your Earnings are withdrawn first, followed by amounts attributed to Purchase Payments with the “oldest” Purchase Payment withdrawn first and before any deduction for other charges due or taxes are made. We also account for any eligible Purchase Payments that are still in the surrender charge period—the period in which a Purchase Payment is still subject to a Withdrawal Charge—that may be withdrawn without incurring a withdrawal charge (e.g. free 10%). See WITHDRAWALS – Optional Withdrawals – Withdrawals Free of a Withdrawal Charge. The withdrawal charge will be deducted proportionately among all Investment Options from which your withdrawal occurs. Unless you specify otherwise, a partial withdrawal amount requested will be processed as a “gross” amount, which means that applicable charges and taxes will be deducted from the requested amount. If a partial withdrawal amount is requested to be a “net” amount, applicable charges and taxes will be added to the requested amount and the withdrawal charges and taxes will be calculated on the grossed up amount.
For example: You make an initial Purchase Payment of $10,000 in Contract Year 1 and make an additional Purchase Payment of $7,000 in Contract Year 2. With Earnings, your Contract Value in Contract Year 3 is $19,000. In Contract Year 3 you make a withdrawal of $9,000. At this point, total Purchase Payments equal $17,000, Earnings equal $2,000, and the “age” of the applicable Purchase Payments withdrawn is 3 Years. Earnings ($2,000) and 10% of all remaining Purchase Payments made ($1,700) may be withdrawn free of a withdrawal charge per Contract year. The amount of the withdrawal charge applied would be $371 ($9,000 - $2,000 - $1,700 = $5,300; $5,300 x 7% = $371).
The withdrawal charge is designed to reimburse us for sales commissions and other expenses associated with the promotion and solicitation of offers for the Contracts, although our actual expenses may be greater or less than the withdrawal charge amount. See ADDITIONAL INFORMATION – Distribution Arrangements for information regarding commissions and other amounts paid to broker-dealers in connection with Contract distribution.
Mortality and Expense Risk Charge and Optional Death Benefit Rider Charge
We assess a charge against the assets of each Subaccount to compensate for certain mortality and expense risks that we assume under the Contract (the “Risk Charge”). The risk that an Annuitant will live longer (and therefore receive more annuity payments) than we predict through our actuarial calculations at the time the Contract is issued is “mortality risk.” The risk that the expense charges and fees under the Contract and Separate Account are less than our actual administrative and operating expenses is called “expense risk.”
This Risk Charge is assessed daily at an annual rate equal to 0.90% of each Subaccount’s assets.
The Risk Charge will stop at the Annuity Date (the Risk Charge will be assessed on the Annuity Date then discontinue thereafter) if you select fixed annuity payments. The Risk Charge (excluding any increase for optional benefits) will continue after the Annuity Date if you choose variable annuity payments, even though we do not bear mortality risk if your Annuity Option is Period Certain Only.
We will realize a gain if the Risk Charge exceeds our actual cost of expenses and benefits, and will suffer a loss if such actual costs exceed the Risk Charge. Any gain will become part of our General Account. We may use it for any reason, including covering sales expenses on the Contracts.
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Increase in Risk Charge if an Optional Death Benefit Rider is Purchased
We increase your Risk Charge by an annual rate equal to 0.15% of each Subaccount’s assets if you purchase the Return of Purchase Payments Death Benefit (Return of Purchase Payments Death Benefit II for Contracts issued in California). The total Risk Charge annual rate will be 1.05%. Any increase in your Risk Charge will not continue after the Annuity Date.
See DEATH BENEFITS AND OPTIONAL DEATH BENEFIT RIDERS – Death Benefits.
We charge an Administrative Fee as compensation for costs we incur in operating the Separate Account, issuing and administering the Contracts, including processing applications and payments, and issuing reports to you and to regulatory authorities.
The Administrative Fee is assessed daily at an annual rate equal to 0.25% of the assets of each Subaccount. This rate is guaranteed not to increase for the life of your Contract. A correlation will not necessarily exist between the actual administrative expenses attributable to a particular Contract and the Administrative Fee paid in respect of that particular Contract. The Administrative Fee will continue after the Annuity Date if you choose any variable payout option. We do not intend to realize a profit from this fee.
We will charge you an Annual Fee of $50.00 on each Contract Anniversary prior to the Annuity Date, and at the time you withdraw your entire Contract Value (on a pro rated basis for that Contract Year) if your Contract Value is less than $50,000 on that date. The fee is not imposed on amounts you annuitize or on payment of death benefit proceeds. The fee reimburses certain costs in administering the Contracts and the Separate Account. We do not intend to realize a profit from this fee. This fee is guaranteed not to increase for the life of your Contract.
Your Annual Fee will be charged proportionately against your Investment Options. Assessments against your Variable Investment Options are made by debiting some of the Subaccount Units previously credited to your Contract. That is, assessment of the Annual Fee does not change the Unit Value for those Subaccounts. Any portion of the Annual Fee we deduct from any of our fixed options (if available under the Contract) will not be greater than the annual interest credited in excess of that fixed option’s minimum guaranteed interest rate.
The following disclosure applies to the Future Income Generator and Enhanced Income Select 2 (Single) or (Joint) Riders.
A living benefit rider must be selected at the time this Contract is purchased. We will deduct an annual rider charge from your Investment Options on a proportionate basis. Deductions against your Variable Investment Options are made by debiting some of the Subaccount Units previously credited to your Contract.
The charge is deducted every 3 months following the Rider Effective Date (“Quarterly Rider Anniversary”). The rider charge will be deducted while the rider remains in effect and when the rider terminates. The charge is deducted in arrears each Quarterly Rider Anniversary.
If your rider terminates on a Quarterly Rider Anniversary, the entire charge for the prior quarter will be deducted on that anniversary. If the rider terminates prior to a Quarterly Rider Anniversary, a prorated charge will be deducted on the earlier of the day the Contract terminates or on the Quarterly Rider Anniversary immediately following the day your rider terminates. The charge will be determined as of the day your rider terminates.
If your rider terminates as a result of the death of the Designated Life (all Designated Lives for a Joint Life Rider) or when the death benefit becomes payable under the Contract, any annual charge deducted between the date of death and the Notice Date will be prorated as applicable to the date of death and added to the Contract Value on the Notice Date.
If you make a full withdrawal of the amount available for withdrawal during a Contract Year, we will deduct the charge from the final payment made to you.
Once your Contract Value is zero, the rider annual charge will no longer be deducted beginning the quarter after the Contract Value is zero. In addition, we will waive the rider charge for the quarter in which full annuitization of the Contract occurs and the rider annual charge will no longer be deducted.
The rider annual charge percentage in effect on the Rider Effective Date is guaranteed not to change once a rider is issued - even if an Automatic Reset or Owner-Elected Reset under the rider occurs. You will find the current annual charge percentage in the Rate Sheet Prospectus Supplement applicable to your Contract. You can find more information about Protected Payment Base and an Automatic Reset or Owner-Elected Reset for each applicable rider in the LIVING BENEFIT RIDERS section.
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Annual Charge Percentage Table
Living Benefit Rider | Maximum Annual Charge Percentage Under the Rider | To determine the amount to be deducted, the Annual Charge Percentage1 is multiplied by the: | The Charge is deducted on each: |
Future Income Generator (Single) | 2.50% | Protected Payment Base2 | Quarterly Rider Anniversary |
Future Income Generator (Joint) | 2.75% | Protected Payment Base2 | Quarterly Rider Anniversary |
Enhanced Income Select 2 (Single) | 2.50% | Protected Payment Base2 | Quarterly Rider Anniversary |
Enhanced Income Select 2 (Joint) | 2.75% | Protected Payment Base2 | Quarterly Rider Anniversary |
1 The quarterly charge is ¼ of the annual charge percentage multiplied by the Protected Payment Base.
2 The Protected Payment Base is defined in the Rider Terms subsection for each rider referenced above. See the LIVING BENEFIT RIDERS section for each rider.
See Mortality and Expense Risk Charge and Optional Death Benefit Rider Charge for the Return of Purchase Payment Death Benefit charge information.
Depending on your state of residence (among other factors), a tax may be imposed on your Purchase Payments (“premium tax”) at the time your Investment is made, at the time of a partial or full withdrawal, at the time any death benefit proceeds are paid, at annuitization or at such other time as taxes may be imposed. Tax rates ranging from 0% to 3.5% are currently in effect, but may change in the future. Premium tax is charged according to the rate determined by your state of residence at the time of annuitization. Premium tax is subject to state requirements. Some local jurisdictions also impose a tax.
If we pay any premium taxes attributable to Purchase Payments, we will impose a similar charge against your Contract Value. We normally will charge you when you annuitize some or all of your Contract Value. We reserve the right to impose this charge for applicable premium taxes and/or other taxes when you make a full or partial withdrawal, at the time any death benefit proceeds are paid, or when those taxes are incurred. For these purposes, “premium taxes” include any state or local premium or retaliatory taxes and any federal, state or local income, excise, business or any other type of tax (or component thereof) measured by or based upon, directly or indirectly, the amount of Purchase Payments we have received. We currently base this charge on your Contract Value, but we reserve the right to base this charge on the transaction amount, the aggregate amount of Purchase Payments we receive under your Contract, or any other amount, that in our sole discretion we deem appropriately reimburses us for premium taxes paid on this Contract.
We may also charge the Separate Account or your Contract Value for taxes attributable to the Separate Account or the Contract, including income taxes attributable to the Separate Account or to our operations with respect to the Contract, or taxes attributable, directly or indirectly, to Purchase Payments. Any such charge deducted from the Contract Value will be deducted on a proportionate basis. See HOW YOUR PURCHASE PAYMENTS ARE ALLOCATED – Investing in Variable Investment Options – Calculating Subaccount Unit Values to see how such charges are deducted from the Separate Account. Currently, we do not impose any such charges.
We may agree to waive or reduce charges under our Contracts, in situations where selling and/or maintenance costs associated with the Contracts are reduced, such as the sale of several Contracts to the same Contract Owner(s), sales of large Contracts, sales of Contracts in connection with a group or sponsored arrangement or mass transactions over multiple Contracts.
We will only waive or reduce such charges on any Contract where expenses associated with the sale or distribution of the Contract and/or costs associated with administering and maintaining the Contract are reduced. We reserve the right to terminate waiver and reduced charge programs at any time, including for issued Contracts.
Your Variable Account Value reflects advisory fees, any service and distribution (12b-1) fees, and other expenses incurred by the various Fund Portfolios, net of any applicable reductions and/or reimbursements. These fees and expenses may vary. Each Fund is governed by its own Board of Trustees, and your Contract does not fix or specify the level of expenses of any Portfolio. A Fund’s fees and expenses are described in detail in the applicable Fund Prospectus and SAI.
Some Investment Options available to you are “fund of funds”. A fund of funds portfolio is a fund that invests in other funds in addition to other investments that the portfolio may make. Expenses of fund of funds Investment Options may be higher than non fund of funds Investment Options due to the two tiered level of expenses involving both the fund-of-fund portfolio’s fees and expenses as well as the proportional share of the fees and expenses of the underlying funds in which the fund-of-fund portfolio invests. See the Fund prospectuses for detailed portfolio expenses and other information before investing.
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See ADDITIONAL INFORMATION – State Considerations for Contracts issued in California.
When you submit your Contract application, you must choose a sole Annuitant or Joint Annuitants. You must make your choices based on the following:
· If you are buying a Non-Qualified Contract, you may choose yourself as the Annuitant, another person as the Annuitant, or you may choose Joint Annuitants. If you do not choose Joint Annuitants when your Contract is issued, you may only add a Joint Annuitant on the Annuity Date. You may choose a Contingent Annuitant only if you have a sole Annuitant (cannot have Joint Annuitants and a Contingent Annuitant at the same time). You may add or change the Contingent Annuitant prior to the Annuity Date, provided the Contingent Annuitant is not the sole surviving Annuitant. If the Contract is owned by a Non-Natural Owner, you may not designate a Contingent Annuitant.
· If you are buying a Qualified Contract, you must be the sole Annuitant. You may only add a Joint Annuitant on the Annuity Date and no Contingent Annuitant can be chosen.
No Annuitant (sole, Joint or Contingent) may be named upon or after reaching his or her 86th birthday. We reserve the right to require proof of age or survival of the Annuitant(s).
If the sole surviving Annuitant predeceases the Owner, the Owner (or youngest Owner if there are Joint Owners) becomes the Annuitant.
Annuitization occurs on the Annuity Date when you convert your Contract from the accumulation phase to the annuitization (income) phase. You may choose both your Annuity Date and your Annuity Option. At the Annuity Date, you may elect to annuitize some or all of your Contract Value, less any applicable charge for premium taxes and/or other taxes, (the “Conversion Amount”), as long as such Conversion Amount annuitized is at least $10,000. We will send the annuity payments to the payee that you designate.
If you annuitize only a portion of this available Contract Value, you may have the remainder distributed, less any applicable charge for premium taxes and/or other taxes, any applicable withdrawal charge, any Annual Fee, and any applicable rider charge. This option of distribution may or may not be available, or may be available only for certain types of contracts. Any such distribution will be made to you in a single sum if the remaining Conversion Amount is less than $10,000 on your Annuity Date. Distributions under your Contract may have tax consequences. You should consult a qualified tax advisor for information on full or partial annuitization.
If you annuitize only a portion of your Contract Value on your Annuity Date, you may, at that time, have the option to elect not to have the remainder of your Contract Value distributed, but instead to continue your Contract with that remaining Contract Value (a “continuing Contract”). If this option is available, you would then choose a second Annuity Date for your continuing Contract, and all references in this Prospectus to your “Annuity Date” would, in connection with your continuing Contract, be deemed to refer to that second Annuity Date. The second Annuity Date may not be later than the date specified in the Choosing Your Annuity Date section of this Prospectus. This option may not be available, or may be available only for certain types of Contracts. You should be aware that some or all of the payments received before the second Annuity Date may be fully taxable. If you annuitize a portion of your Contract Value for a period certain of at least 10 years or for the life or life expectancy of the annuitant(s), the annuitized portion will be treated as a separate Contract for the purpose of determining the taxable amount of the payments. We recommend that you contact a qualified tax advisor for more information if you are interested in this option.
Distributions made due to a request for partial annuitization are treated as withdrawals for Contract purposes and may adversely affect living benefit and optional death benefit rider benefits. Work with your financial professional prior to requesting partial annuitization.
You should choose your Annuity Date when you submit your application or we will apply a default Annuity Date to your Contract. You may change your Annuity Date by notifying us, In Proper Form, at least 10 Business Days prior to the earlier of your current Annuity Date or your new Annuity Date. Your Annuity Date cannot be earlier than your first Contract Anniversary. Adverse federal tax consequences may result if you choose an Annuity Date that is prior to an Owner’s attained age 59½. See FEDERAL TAX ISSUES.
If you have a sole Annuitant, your Annuity Date cannot be later than the sole Annuitant’s 95th birthday. If you have Joint Annuitants, your Annuity Date cannot be later than your younger Joint Annuitant’s 95th birthday. Different requirements may apply as required by any applicable state law or the Code. We may, at our sole discretion, allow you to extend your Annuity Date. We reserve the right, at any time, to not offer any extension to your Annuity Date regardless of whether we may have granted any extensions to you or to any others in the past. Some Broker/Dealers may not allow their clients to extend the Annuity Date beyond age 95.
If your Contract is a Qualified Contract, you may also be subject to additional restrictions. In order to meet the Code minimum distribution rules, your Required Minimum Distributions (RMDs) may begin earlier than your Annuity Date. For instance, under Section 401 of the Code (for Qualified Plans) and Section 408 of the Code (for IRAs), the entire interest under the Contract must be
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distributed to the Owner/Annuitant not later than the Owner/Annuitant’s Required Beginning Date (“RBD”), or distributions over the life of the Owner/Annuitant (or the Owner/Annuitant and his or her Beneficiary) must begin no later than the RBD. For more information see FEDERAL TAX ISSUES.
Default Annuity Date and Options
If you have a Non-Qualified Contract and you do not choose an Annuity Date when you submit your application, your Annuity Date will be your Annuitant’s 95th birthday or your younger Joint Annuitant’s 95th birthday, whichever applies. If you have a Qualified Contract and you do not choose an Annuity Date when you submit your application, your Annuity Date will be your Annuitant’s 95th birthday. However, some states’ laws may require a different Annuity Date. Certain Qualified Contracts may require distributions to occur at an earlier age.
If you have not specified an Annuity Option or do not instruct us otherwise, at your Annuity Date your Contract Value, less any charges for premium taxes and/or other taxes, will be annuitized (if this net amount is at least $10,000) and the net amount from your Variable Account Value will be converted into a variable-dollar annuity directed to the Subaccount proportionate to your Account Value in each.
Additionally:
· If you have a Non-Qualified Contract, your default Annuity Option will be Life with a ten year Period Certain.
· If you have a Qualified Contract, your default Annuity Option will be Life with a five year Period Certain or a shorter period certain as may be required by federal regulation. If you are married, different requirements may apply. Please contact your plan administrator for further information, if applicable.
· If the net amount is less than $10,000, the entire amount will be distributed in one lump sum.
You should carefully review the Annuity Options with a qualified tax advisor, and, for Qualified Contracts, reference should be made to the terms of the particular plan and the requirements of the Code for pertinent limitations regarding annuity payments, Required Minimum Distributions (“RMDs”), and other matters.
You may make 3 basic decisions about your annuity payments. First, you may choose whether you want those payments to be a fixed- dollar amount and/or a variable-dollar amount. Second, you may choose the form of annuity payments (see Annuity Options below). Third, you may decide how often you want annuity payments to be made (the “frequency” of the payments). You may not change these selections after the Annuity Date.
Fixed and Variable Payment Options
You may choose fixed annuity payments based on a fixed rate and the 2012 Individual Annuity Mortality Period Life Table with the ages set back 10 years, variable annuity payments that vary with the investment results of the Subaccounts you select, or you may choose both, converting one portion of the net amount you annuitize into fixed annuity payments and another portion into variable annuity payments.
If you select fixed annuity payments, each periodic annuity payment received will be equal to the initial annuity payment, unless you select a Joint and Survivor Life annuity with reduced survivor payments when the Primary Annuitant dies. Any net amount you convert to fixed annuity payments will be held in our General Account (but not under any fixed option).
If you select variable annuity payments, you may choose as many Variable Investment Options as you wish. The amount of the periodic annuity payments will vary with the investment results of the Variable Investment Options selected and may be more or less than a fixed payment option. After the Annuity Date, Annuity Units may be exchanged among available Variable Investment Options up to 4 times in any 12 month period. How your Contract converts into variable annuity payments is explained in more detail in THE CONTRACTS AND THE SEPARATE ACCOUNT section in the SAI. We reserve the right to limit the Subaccounts available, to change the number and frequency of exchanges and to change the number of Subaccounts you may choose.
Annuity Options
Four Annuity Options are currently available under the Contract, although additional options may become available in the future. You may select either fixed or variable payment options. For other Annuity Options available through living benefit riders, see the LIVING BENEFIT RIDERS section and also see the Other Annuity Options section below.
1. Life Only. Periodic payments are made to the designated payee during the Annuitant’s lifetime. Payments stop when the Annuitant dies. Annuitization becomes effective when the first payment is processed. If the Annuitant dies prior to the first payment the death benefit would be calculated as described under the DEATH BENEFITS AND OPTIONAL DEATH BENEFIT RIDERS section of the Prospectus and no annuity payment would be made. If the Annuitant passes away after the first payment has processed, payments will cease and there would be no death benefit
2. Life with Period Certain. Periodic payments are made to the designated payee during the Annuitant’s lifetime, with payments guaranteed for a specified period. You may choose to have payments guaranteed from 5 through 30 years (in full years only). The guaranteed period may be limited on Qualified Contracts based on your life expectancy and/or to a period certain not to exceed 10
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years and this option may be restricted for certain Qualified Contracts or Qualified Plans. Annuitization becomes effective when the first payment is processed. If the Annuitant dies prior to the first payment the death benefit would be calculated as described under the DEATH BENEFITS AND OPTIONAL DEATH BENEFIT RIDERS section of the Prospectus and no annuity payments would be made. If the Annuitant dies after the first payment has processed, payments will continue for any remainder of the Period Certain time frame.
3. Joint and Survivor Life. Periodic payments are made to the designated payee during the lifetime of the Primary Annuitant. After the death of the Primary Annuitant, periodic payments will continue to be made during the lifetime of the secondary Annuitant named in the election. You may choose to have the payments during the lifetime of the surviving secondary Annuitant equal 50%, 66 2/3% or 100% of the original amount payable during the lifetime of the Primary Annuitant (you must make this election when you choose your Annuity Option). If you elect a reduced payment based on the life of the secondary Annuitant, fixed annuity payments will be equal to 50% or 66 2/3% of the original fixed payment payable during the lifetime of the Primary Annuitant; variable annuity payments will be determined using 50% or 66 2/3%, as applicable, of the number of Annuity Units for each Subaccount credited to the Contract as of the date of death of the Primary Annuitant. Payments stop when both Annuitants have died. Annuitization becomes effective when the first payment is processed. If one or both Annuitants die prior to the first payment the death benefit would be calculated as described under the DEATH BENEFITS AND OPTIONAL DEATH BENEFIT RIDERS section of the Prospectus and no annuity payment would be made. If both Annuitants pass away after the first payment has processed, payments will cease and there would be no death benefit.
4. Period Certain Only. Periodic payments are made to the designated payee, guaranteed for a specified period. You may choose to have payments guaranteed from 5 through 30 years (in full years only). Additional guaranteed time periods may become available in the future. Before you annuitize your Contract, please contact us for additional guaranteed time period options that may be available. The guaranteed period may be limited on Qualified Contracts based on your life expectancy and/or to a period certain not to exceed 10 years and this option may be restricted for certain Qualified Contracts or Qualified Plans. Annuitization becomes effective when the first payment is processed. If the Annuitant dies prior to the first payment the death benefit would be calculated as described under the DEATH BENEFITS AND OPTIONAL DEATH BENEFIT RIDERS section of the Prospectus and no annuity payments would be made. If the Annuitant dies after the first payment has processed, payments will continue for any remainder of the Period Certain time frame.
Periodic payment amounts will differ based on the Annuity Option selected. Generally, the longer the possible payment period, the lower the payment amount.
Additionally, if variable payments are elected under Annuity Options 2 and 4 (Life with Period Certain and Period Certain Only, respectively), or Joint Life with Period Certain (see the Other Annuity Options subsection below), you may redeem all remaining guaranteed variable payments after the Annuity Date. Also, under Option 4, partial redemptions of remaining guaranteed variable payments after the Annuity Date are available. If you elect to redeem all remaining guaranteed variable payments in a single sum, we will not make any additional annuity payments during the remaining guaranteed period after the redemption. If Annuity Option 2 or Joint Life with Period Certain was elected and the Annuitant is alive at the end of the guaranteed period, annuity payments will resume until the Annuitant’s death. The amount available upon full redemption would be the present value of any remaining guaranteed payments at the assumed investment return. Any applicable withdrawal charge will be deducted from the present value as if you made a full withdrawal, or if applicable, a partial withdrawal. For purposes of calculating the withdrawal charge and free withdrawal amount, it will be assumed that the Contract was never converted to provide annuity payments and any prior annuity payments in that Contract Year will be treated as if they were partial withdrawals from the Contract (see CHARGES, FEES AND DEDUCTIONS – Withdrawal Charge). If you have a Qualified Contract, there may be adverse tax implications if you elect to redeem any remaining variable payments in a single sum. Work with your tax advisor before making such an election.
For example, assume that a Contract was issued with a single investment of $10,000 and in Contract Year 4 the Owner elects to receive variable annuity payments under Annuity Option 4. In Contract Year 5, the Owner elects to make a partial redemption of $5,000. The withdrawal charge as a percentage of the Purchase Payments with an age of 5 years is 5%. Assuming the free withdrawal amount immediately prior to the partial redemption is $300, the withdrawal charge for the partial redemption will be $235 (($5,000 - $300) x 5% = $235). No withdrawal charge will be imposed on a redemption if:
· the Annuity Option is elected as the form of payments of death benefit proceeds, or
· the Annuitant dies before the period certain has ended and the Beneficiary requests a redemption of the variable annuity payments.
Full or partial redemptions of remaining guaranteed variable payments are explained in more detail in the SAI under THE CONTRACTS AND THE SEPARATE ACCOUNT.
If the Annuitant dies before the guaranteed payments under Annuity Options 2 and 4 are completed, we will pay the remainder of the guaranteed payments to the first person among the following who is (1) living; or (2) an entity or corporation entitled to receive the remainder of the guaranteed payments:
· the Owner;
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· the Joint Owner;
· the Beneficiary; or
· the Contingent Beneficiary.
If none are living (or if there is no entity or corporation entitled to receive the remainder of the guaranteed payments), we will pay the remainder of the guaranteed payments to the Owner’s estate.
If any Owner dies on or after the Annuity Date, but payments have not yet been completed, then distributions of the remaining amounts payable under the Contract must be made at least as rapidly as the method of distribution that was being used at the date of the Owner’s death. All of the Owner’s rights granted by the Contract will be assumed by the first among the following who is (1) living; or (2) an entity or corporation entitled to assume the Owner’s rights granted by the Contract:
· the Joint Owner;
· the Beneficiary; or
· the Contingent Beneficiary.
If none are living (or if there is no entity or corporation entitled to assume the Owner’s rights granted by the Contract), all of the Owner’s rights granted by the Contract will be assumed by the Owner’s estate.
For Qualified Contracts, please refer to the Choosing Your Annuity Date section in this Prospectus. If your Contract was issued in connection with a Qualified Plan subject to Title I of the Employee Retirement Income Security Act of 1974 (“ERISA”), your spouse’s consent may be required when you seek any distribution under your Contract, unless your Annuity Option is Joint and Survivor Life with survivor payments of at least 50%, and your spouse is your Joint Annuitant.
Other Annuity Options
Additional annuity payment options we currently offer are:
· Life with Cash Refund (fixed only). Periodic payments are made to the designated payee during the Annuitant’s lifetime. Annuitization becomes effective when the first payment is processed. If the Annuitant dies prior to the first payment the death benefit would be calculated as described under the DEATH BENEFITS AND OPTIONAL DEATH BENEFIT RIDERS section of the Prospectus and no annuity payment would be made. If the Annuitant dies after the Annuity Date and the total of all annuity payments received is less than the amount annuitized, an amount equal to the amount annuitized less the total annuity payments made, will be made in a single sum.
· Life with Installment Refund (fixed only). Periodic payments are made to the designated payee during the Annuitant’s lifetime. If the Annuitant dies after the Annuity Date but before the total of all annuity payments made equals or exceeds the amount annuitized, annuity payments will continue to be made until the total amount of annuity payments made equals the amount annuitized; the final annuity payment may be less than the periodic annuity payment. Annuitization becomes effective when the first payment is processed. If the Annuitant dies prior to the first payment the death benefit would be calculated as described under the DEATH BENEFITS AND OPTIONAL DEATH BENEFIT RIDERS section of the Prospectus and no annuity payment would be made. If the Annuitant dies and the total amount of annuity payments made is equal to or exceeds the amount annuitized, then no additional annuity payments will be made. This annuity option is not available for Qualified Contracts.
· Joint Life with Cash Refund (fixed only). Periodic payments are made to the designated payee during the lifetimes of the Primary Annuitant and Joint Annuitant. If both Annuitants die before the total of all annuity payments made equal the amount annuitized, an amount equal to the amount annuitized, less total annuity payments made under the Contract, will be made in a single sum. Annuitization becomes effective when the first payment is processed. If one or both Annuitants die prior to the first payment the death benefit would be calculated as described under the DEATH BENEFITS AND OPTIONAL DEATH BENEFIT RIDERS section of the Prospectus and no annuity payment would be made. If both Annuitants die and the total amount of annuity payments made under the Contract is equal to or exceeds the amount annuitized, then no additional lump sum or annuity payments will be paid. This option may be restricted for certain Qualified Contracts or Qualified Plans.
· Joint Life with Installment Refund (fixed only). Periodic Payments are made to the designate payee during the lifetimes of the Primary Annuitant and Joint Annuitant. If both Annuitants die before the total of all annuity payments made equals or exceeds the amount annuitized, annuity payments will continue to be made until the total amount of annuity payments made equals the amount annuitized; the final annuity payment may be less than the periodic annuity payment. Annuitization becomes effective when the first payment is processed. If one or both Annuitants die prior to the first payment the death benefit would be calculated as described under the DEATH BENEFITS AND OPTIONAL DEATH BENEFIT RIDERS section of the Prospectus and no annuity payment would be made. If both Annuitants die and the total amount of annuity payments made under the Contract is equal to or exceeds the amount annuitized, then no additional annuity payments will be paid. This annuity option is not available for Qualified Contracts.
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· Joint Life with Period Certain (fixed or variable). Periodic payments are made to the designated payee during the Primary Annuitant’s lifetime, with payments guaranteed for a specified period. After the death of the Primary Annuitant, periodic payments will continue to be made during the lifetime of the secondary Annuitant named in the election or until the end of the period certain period, whichever is later. You may choose to have payments guaranteed from 5 through 30 years (in full years only). The guaranteed period may be limited on Qualified Contracts based on your life expectancy and/or to a period certain not to exceed 10 years and this option may be restricted for certain Qualified Contracts and Qualified Plans. Annuitization becomes effective when the first payment is processed. If one or both Annuitants die prior to the first payment the death benefit would be calculated as described under the DEATH BENEFITS AND OPTIONAL DEATH BENEFIT RIDERS section of the Prospectus and no annuity payment would be made. If both Annuitants die after the first payment has been processed, payments will continue for any remainder of the Period Certain time frame.
We may discontinue offering any of the additional annuity options referenced above or add additional annuity options in the future. If we discontinue offering or add additional annuity options, we will amend this Prospectus to reflect any changes.
Frequency of Payments
You may choose to have annuity payments made monthly, quarterly, semi-annually, or annually. The variable payment amount will be determined in each period on the date corresponding to your Annuity Date, and payment will be made on the next Business Day.
Your initial annuity payment must be at least $240. Depending on the amount you annuitize, this requirement may limit your options regarding the period and/or frequency of annuity payments.
Amount of the First Payment
Your Contract contains tables that we use to determine the amount of the first annuity payment under your Contract, taking into consideration the annuitized portion of your Contract Value at the Annuity Date. This amount will vary, depending on the annuity period and payment frequency you select. This amount will be larger in the case of shorter Period Certain annuities and smaller for longer Period Certain annuities. Similarly, this amount will be greater for a Life Only annuity than for a Joint and Survivor Life annuity, because we will expect to make payments for a shorter period of time on a Life Only annuity. If you do not choose the Period Certain Only annuity, this amount will also vary depending on the age of the Annuitant(s) on the Annuity Date and, for some Contracts in some states, the sex of the Annuitant(s).
For fixed annuity payments, the guaranteed income factors in our tables are based on an annual interest rate of 1.0% and the 2012 Individual Annuity Mortality Period Life Table with the ages set back 10 years. If you elect a fixed annuity, fixed annuity payments will be based on the periodic income factors in effect for your Contract on the Annuity Date which are at least the guaranteed income factors under the Contract.
For variable annuity payments, the tables are based on an assumed annual investment return of 4% and the 2012 Individual Annuity Mortality Period Life Table with the ages set back 10 years. If you elect a variable annuity, your initial variable annuity payment will be based on the applicable variable annuity income factors in effect for your Contract on the Annuity Date which are at least the variable annuity income factors under the Contract. You may choose any other annuity option we may offer on the option’s effective date. A higher assumed investment return would mean a larger first variable annuity payment and a lower assumed investment return would mean a lower first variable annuity payment. However, subsequent payments would increase only when actual net investment performance exceeds the assumed rate and would fall when actual net investment performance is less than the assumed rate. If the actual net investment performance is a constant 4% annually, annuity payments will be level. The assumed investment return is explained in more detail in the SAI under THE CONTRACTS AND THE SEPARATE ACCOUNT.
DEATH BENEFITS AND OPTIONAL DEATH BENEFIT RIDERS
See the Death Benefits section and applicable subsections in ADDITIONAL INFORMATION – State Considerations for Contracts issued in California.
Death benefit proceeds may be payable before the Annuity Date upon the death of the first Owner or any Annuitant in the case of a Non-Natural Owner, while the Contract is active. Any death benefit payable will be calculated on the “Notice Date”, which is the Business Day on which we receive, In Proper Form, proof of death and instructions regarding payment of death benefit proceeds. If a Contract has multiple Beneficiaries, death benefit proceeds will be calculated when we first receive proof of death and instructions, In Proper Form, from any Beneficiary. The death benefit proceeds still remaining to be paid to other Beneficiaries will fluctuate with the performance of the underlying Investment Options.
Death Benefit Proceeds
Death benefit proceeds will be payable on the Notice Date. Such proceeds will be reduced by any charges for premium taxes and/or other taxes, if proceeds are used to purchase an Annuity Option from us. The death benefit proceeds may be payable in a single sum, as an Annuity Option available under the Contract, towards the purchase of any other Annuity Option we then offer, or in any other manner permitted by the IRS and approved by us. The Owner’s spouse may continue the Contract (see Death Benefits – Spousal
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Continuation). In addition, there may be legal requirements that limit the recipient’s Annuity Options and the timing of any payments. State unclaimed property regulations may shorten the amount of time a recipient has to make a death benefit election. A recipient should consult a qualified tax advisor before making a death benefit election.
The death benefit proceeds will be paid to the first among the following who is (1) living; or (2) an entity entitled to receive the death benefit proceeds, in the following order:
· Owner,
· Joint Owner,
· Beneficiary, or
· Contingent Beneficiary.
If a contract has Joint Owners, and the surviving Joint Owner dies before the Notice Date, the death benefit proceeds will be paid to the Beneficiary or Contingent Beneficiary. If none of the above are living (or if there is no entity entitled to receive the death benefit proceeds) on the date of death, the proceeds will be payable to the Owner’s estate.
Death Benefit Amount
The Death Benefit Amount as of any Business Day, before the Annuity Date, is equal to the Contract Value as of that Business Day. We calculate the Death Benefit Amount as of the Notice Date and the death benefit will be paid in accordance with the Death Benefit Proceeds section above.
Spousal Continuation
Generally, a sole surviving Beneficiary or sole surviving Joint Owner who is the deceased Owner’s spouse may elect to become the Owner (and sole Annuitant if the deceased Owner had been the Annuitant) and continue the Contract until the earliest of the spouse’s death, or the Annuity Date. The spousal continuation election must be made by the fifth anniversary of the death of the Contract Owner for Non-Qualified Contracts, or by December 31 of the calendar year in which the fifth anniversary of the Contract Owner’s death falls for Qualified Contracts. On the Notice Date, if the surviving spouse is deemed to have continued the Contract, we will set the Contract Value equal to the death benefit proceeds that would have been payable to the spouse as the deemed Beneficiary/designated recipient of the death benefit proceeds.
If the optional Return of Purchase Payments Death Benefit is purchased. An Add-In Amount may be added to the death benefit proceeds if the surviving spouse continues the Contract. This “Add-In Amount” is the difference between the Contract Value and the death benefit proceeds that would have been payable to the spouse as the designated recipient of the death benefit. The Add-In Amount will be added to the Contract Value on the Notice Date. There will not be an adjustment to the Contract Value if the Contract Value is equal to or greater than the death benefit proceeds as of the Notice Date. The Add-In Amount will be allocated among Investment Options in accordance with the current allocation instructions for the Contract and may be, under certain circumstances, considered earnings. The Add-In Amount is not treated as a new Purchase Payment.
Example: On the Notice Date, the Owner’s surviving spouse elects to continue the Contract. On that date, the death benefit proceeds were $100,000 and the Contract Value was $85,000. Since the surviving spouse elected to continue the Contract in lieu of receiving the death benefit proceeds, we will increase the Contract Value by an Add-In Amount of $15,000 ($100,000 - $85,000 = $15,000). If the Contract Value on the Notice Date was $100,000 or higher, then nothing would be added to the Contract Value.
The continuing spouse is subject to the same fees, charges and expenses applicable to the deceased Owner of the Contract.
A Joint Owner who is the designated recipient, but not the Owner’s spouse, may not continue the Contract. Under IRS Guidelines, once a surviving spouse continues the Contract, the Contract may not be continued again in the event the surviving spouse remarries. Please refer to the living benefit rider attached to your Contract to determine how any guaranteed amounts may be affected when a surviving spouse continues the Contract.
Death of Annuitant
If an Annuitant (who is not an Owner) dies and there is a surviving Joint Annuitant, the surviving Joint Annuitant becomes the Annuitant. If there is no surviving Joint Annuitant but there is a Contingent Annuitant, the Contingent Annuitant becomes the Annuitant. If there is no surviving Joint Annuitant or Contingent Annuitant, the youngest Owner becomes the Annuitant, provided that the Owner is not a Non-Natural Owner. No death benefit will be paid, except as otherwise provided under the Death Benefit Proceeds section.
Death of Owner
If any Owner dies before the Annuity Date, the amount of the death benefit will be equal to the Death Benefit Amount under the Contract as of the Notice Date and will be paid in accordance with the Death Benefit Proceeds section and in accordance with the federal income tax distribution at death rules discussed in the FEDERAL TAX ISSUES section.
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Non-Natural Owner
If you are a Non-Natural Owner of a Contract other than a Contract issued under a Qualified Plan as defined in Section 401 of the Code, the Annuitant (either Annuitant if there are Joint Annuitants) will be treated as the Owner of the Contract for purposes of the Non-Qualified Contract Distribution Rules. If there are Joint or Contingent Annuitants, the death benefit proceeds will be payable on proof of death of the first annuitant. If there is a change in the Primary Annuitant prior to the Annuity Date, such change will be treated as the death of the Owner (however, under the terms of your Contract, you cannot change the Primary Annuitant). The Death Benefit Amount will be: (a) the Contract Value, if the Non-Natural Owner elects to maintain the Contract and reinvest the Contract Value into the contract in the same amount as immediately prior to the distribution; or (b) the Contract Value, less any Annual Fee, withdrawal charge and charges for premium taxes and/or other taxes, if the Non-Natural Owner elects a cash distribution and will be paid in accordance with the Death Benefits Proceeds section and in accordance with the federal income tax distribution at death rules discussed in the FEDERAL TAX ISSUES section.
Non-Qualified Contract Distribution Rules
The Contract is intended to comply with all applicable provisions of Code Section 72(s) and any successor provision, as deemed necessary by us to qualify the Contract as an annuity contract for federal income tax purposes. If an Owner of a Non-Qualified Contract dies before the Annuity Date, distribution of the death benefit proceeds must begin within 1 year after the Owner’s death or complete distribution within 5 years after the Owner’s death. In order to satisfy this requirement, the designated recipient must receive a final lump sum payment by the 5th anniversary of the Contract Owner’s death, or elect to receive an annuity for life or over a period that does not exceed the life expectancy of the designated recipient with annuity payments that start within 1 year after the Owner’s death or, if permitted by the IRS, elect to receive a systematic distribution over a period not exceeding the beneficiary’s life expectancy using a method that would be acceptable for purposes of calculating the minimum distribution required under section 401(a)(9) of the Code. If an election to receive an annuity is not made within 60 calendar days of our receipt of proof, In Proper Form, of the Owner’s death or, if earlier, 60 calendar days (or shorter period as we permit) prior to the 1st anniversary of the Owner’s death, the option to receive annuity payments is no longer available. If a Non-Qualified Contract has Joint Owners, this requirement applies to the first Contract Owner to die.
The Owner may designate that the Beneficiary will receive death benefit proceeds in a lump sum, or through annuity payments for Life, Life with Period Certain, Period Certain or a Scheduled Payout Option. Any Life with Period Certain or Period Certain payout period is 5 through 30 years, but cannot exceed the life expectancy of the Beneficiary. The Owner must designate the payment method in writing in a form acceptable to us. The Owner may revoke the designation only in writing and only in a form acceptable to us. Once the Owner dies, the Beneficiary cannot change or revoke the Owner’s instructions regarding the payment of death benefit proceeds.
Qualified Contract Distribution Rules
Under Treasury regulations and our administrative procedures, if the Contract is owned under a Qualified Plan as defined in Sections 401, 457(b), 408, or 408A of the Code distributions to the Beneficiary must satisfy the Required Minimum Distribution (RMD) rules of Code Section 401(a)(9). For Owner/Annuitants who die after December 31, 2019, the RMD rules for Beneficiaries who inherit an account or IRA are different depending on whether the Beneficiary is an “Eligible Designated Beneficiary” (EDB) or not. An EDB includes a surviving spouse, a disabled individual, a chronically ill individual, a minor child, or an individual who is not more than 10 years younger than the Owner/Annuitant. Certain trusts created for the exclusive benefit of disabled or chronically ill Beneficiaries are included. These EDBs may take their distributions over the Beneficiary's life expectancy and those distributions must commence by December 31st of the year following the death of the Owner/Annuitant. However, minor children must still take remaining distributions within 10 years of reaching age 18. Additionally, a surviving spouse Beneficiary may delay commencement of distributions until the later of the end of the year that the Owner/Annuitant would have attained age 72, or when the surviving spouse turns 72.
Designated Beneficiaries, who are not an EDB, must withdraw the entire account by the 10th calendar year following the death of the Owner/Annuitant.
Non-designated Beneficiaries must withdraw the entire account within 5 years of the Owner/Annuitant’s death if distributions have not begun prior to death unless the owner dies after commencing his or her RMD payments.
If the Owner/Annuitant dies after the commencement of RMDs (except in the case of a Roth IRA when RMDs do not apply) but before the Annuitant’s entire interest in the Contract (other than a Roth IRA) has been distributed, the remaining interest in the Contract must be distributed to the non-designated Beneficiary at least as rapidly as under the distribution method in effect at the time of the Annuitant’s death.
You are responsible for monitoring distributions that must be taken to meet IRS guidelines.
The Owner may designate that the Beneficiary will receive death benefit proceeds in a lump sum, or through annuity payments for a Period Certain of 5 through 9 years. The Owner must designate the payment method in writing in a form acceptable to us. The Owner may revoke the designation only in writing and only in a form acceptable to us. Once the Owner dies, the Beneficiary cannot change or revoke the Owner’s instructions regarding the payment of death benefit proceeds.
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Return of Purchase Payments Death Benefit
This Rider is not available for Contracts issued in California, See Return of Purchase Payments Death Benefit II below for Contracts issued in California.
This optional Rider allows you to have your Death Benefit Amount, as of the Notice Date, be the greater of the Contract Value or the Total Adjusted Purchase Payments. The Notice Date is the day on which we receive, In Proper Form, proof of death and instructions regarding payment of any death benefit proceeds. An Owner change may only be elected if the age of any new Owner is 85 years or younger on the effective date of the Owner change (see the Owner Change subsection below).
Purchasing the Rider
You may purchase this optional Rider at the time your application is completed and before your Contract is issued. You may not purchase this Rider after the Contract Date. This Rider may only be purchased if the age of each Owner and Annuitant is 85 or younger on the Contract Date.
Rider Terms
Total Adjusted Purchase Payments – The sum of all Purchase Payments made to the Contract, reduced by a Pro Rata Reduction for each prior withdrawal, including withdrawals under a withdrawal benefit rider or RMDs. This amount may be adjusted if there is an Owner change.
Pro Rata Reduction – The reduction percentage that is calculated at the time of the withdrawal by dividing the amount of each withdrawal by the Contract Value immediately prior to the withdrawal. The reduction made, when the Contract Value is less than the Total Adjusted Purchase Payments made into the Contract, may be greater than the actual amount withdrawn.
How the Rider Works
Upon the death of the first Owner (any Annuitant for Non-Natural Owners), before the Annuity Date, the Death Benefit Amount under this rider will be equal to the greater of (a) or (b) below:
(a) the Contract Value as of the Notice Date.
(b) Total Adjusted Purchase Payments as of the Notice Date.
Owner Change
If there is an Owner change to someone other than the previous Owner’s spouse, to a Trust or non-natural entity where the Owner and Annuitant are not the same person prior to the Owner change, or if an Owner is added that is not the Owner’s spouse, the Total Adjusted Purchase Payments will be reset to equal the lesser of:
· the Contract Value as of the effective date of the Owner change (“Change Date”), or
· Total Adjusted Purchase Payments as of the Change Date.
After the Change Date, the Total Adjusted Purchase Payments will be increased by any Purchase Payments made after the Change Date and will be reduced by any Pro Rata Reduction for any withdrawals made after the Change Date. An Owner change to a Trust or non-natural entity where the Owner and the Annuitant are the same person prior to the Owner change will not trigger a reset.
Any death benefit paid under this Rider will be paid in accordance with the Death Benefit Proceeds subsection.
See the RETURN OF PURCHASE PAYMENTS DEATH BENEFIT SAMPLE CALCULATIONS APPENDIX.
Termination
The Rider will remain in effect until the earlier of:
· the date you reduce your Contract Value to zero (0) through a withdrawal,
· when death benefit proceeds become payable under the Contract (except where the spouse of the deceased Owner continues the Contract, see DEATH BENEFITS AND OPTIONAL DEATH BENEFIT RIDERS – Spousal Continuation),
· the Contract is terminated in accordance with the provisions of the Contract, or
· the Annuity Date.
The Rider may not otherwise be cancelled.
Return of Purchase Payments Death Benefit II
This Rider is only available for Contracts issued in California.
This optional Rider allows you to have your Death Benefit Amount, as of the Notice Date, be the greater of the Contract Value or the Total Adjusted Purchase Payments. The Notice Date is the day on which we receive, In Proper Form, proof of death and instructions regarding payment of any death benefit proceeds.
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Purchasing the Rider
You may purchase this optional Rider at the time your application is completed and before your Contract is issued. You may not purchase this Rider after the Contract Date. This Rider may only be purchased if the age of each Owner and Annuitant is 85 or younger on the Contract Date.
Rider Terms
Total Adjusted Purchase Payments – The sum of all Purchase Payments made to the Contract, reduced by a Pro Rata Reduction for each prior withdrawal, including withdrawals under a withdrawal benefit rider or RMDs.
Pro Rata Reduction – The reduction percentage that is calculated at the time of the withdrawal by dividing the amount of each withdrawal by the Contract Value immediately prior to the withdrawal. The reduction made, when the Contract Value is less than the Total Adjusted Purchase Payments made into the Contract, may be greater than the actual amount withdrawn.
How the Rider Works
Upon the death of the first Annuitant, before the Annuity Date, the Death Benefit Amount under this rider will be equal to the greater of (a) or (b) below:
(a) the Contract Value as of the Notice Date.
(b) Total Adjusted Purchase Payments as of the Notice Date.
Any death benefit paid under this Rider will be paid in accordance with the Death Benefit Proceeds subsection.
See the RETURN OF PURCHASE PAYMENTS DEATH BENEFIT SAMPLE CALCULATIONS APPENDIX.
Termination
The Rider will remain in effect until the earlier of:
· the date you reduce your Contract Value to zero (0) through a withdrawal,
· when death benefit proceeds become payable under the Contract (except where the spouse of the deceased Owner continues the Contract, see DEATH BENEFITS AND OPTIONAL DEATH BENEFIT RIDERS – Spousal Continuation),
· the Contract is terminated in accordance with the provisions of the Contract, or
· the Annuity Date.
The Rider may not otherwise be cancelled.
You may, on or prior to your Annuity Date, withdraw all or a portion of the amount available under your Contract while the Owner (or Annuitant in the case of a Non-Natural Owner) is living and your Contract is in force. You may surrender your Contract and make a full withdrawal at any time. If you surrender your Contract it will be terminated as of the Effective Date of the withdrawal. You may request to withdraw a specific dollar amount or a specific percentage of an Account Value or your Contract Value. You may choose to make your withdrawal from specified Investment Options. If you do not specify Investment Options, your withdrawal will be made from all of your Investment Options proportionately. However, partial withdrawals from any fixed option in any Contract Year may be subject to restrictions. See HOW YOUR PURCHASE PAYMENTS ARE ALLOCATED – Transfers and Market-timing Restrictions and THE GENERAL ACCOUNT.
Each partial withdrawal must be for $500 or more. Pre-authorized partial withdrawals must be at least $250, except for pre-authorized withdrawals distributed by Electronic Funds Transfer (EFT), which must be at least $100. If your partial withdrawal from an Investment Option would leave a remaining Account Value in that Investment Option of less than $500, we also reserve the right, at our option and with prior written notice, to transfer that remaining amount to your other Investment Options on a proportionate basis relative to your most recent allocation instructions.
See HOW YOUR PURCHASE PAYMENTS ARE ALLOCATED – Transfers and Market-timing Restrictions.
Distributions made due to divorce instructions or under Code Section 72(t)/72(q) (substantially equal periodic payments) are treated as withdrawals for Contract purposes and may result in a withdrawal charge assessment.
Amount Available for Withdrawal
The amount available for withdrawal is your Contract Value at the end of the Business Day on which your withdrawal request is effective, less any applicable Annual Fee, rider Charges, withdrawal charge, and any charge for premium taxes and/or other taxes. The amount we send to you (your “withdrawal proceeds”) will also reflect any required or requested federal and state income tax withholding. See FEDERAL TAX ISSUES and THE GENERAL ACCOUNT. If you own living benefit riders, taking a withdrawal
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before a certain age or a withdrawal that is greater than the allowed annual withdrawal amount under a rider, may result in adverse consequences such as a reduction in rider benefits, failure to receive lifetime withdrawals under the rider, or termination of the rider.
You assume investment risk on Purchase Payments in the Subaccounts. As a result, the amount available to you for withdrawal from any Subaccount may be more or less than the total Purchase Payments you have allocated to that Subaccount.
Withdrawals Free of a Withdrawal Charge
Subject to the amount available for withdrawal provisions described above, during a Contract Year you may withdraw your Earnings plus your “eligible Purchase Payments” without incurring a withdrawal charge. Eligible Purchase Payments include 10% of all remaining Purchase Payments at the beginning of a Contract Year that have an “age” of less than 8 years, plus 10% of any Purchase Payments received during the Contract Year plus 100% of any remaining Purchase Payments that have an age of 8 years or more. Our calculations of the withdrawal charge deduct this “free 10%” from your “oldest” Purchase Payment that is still subject to the withdrawal charge. Withdrawals of mandatory required minimums from certain Qualified Plans and the maximum annual withdrawal amount allowed under a living benefit rider count towards the calculation of the free withdrawal amount for a Contract Year. Any portion of your eligible Purchase Payments not withdrawn during a Contract Year may not be carried over to the next Contract Year.
For example:: You make an initial Purchase Payment of $10,000 in Contract Year 1, and make additional Purchase Payments of $1,000 and $6,000 in Contract Year 2. With Earnings, your Contract Value in Contract Year 3 is $19,000. In Contract Year 3, you may withdraw $3,700 free of the withdrawal charge (your remaining Purchase Payments were $17,000, so 10% of that total equals $1,700, plus you had $2,000 of Earnings). After this withdrawal, your Contract Value is $15,300. In Contract Year 4, your Contract Value falls to $12,500; you may withdraw $1,530 (10% of $15,300; $15,300 represents the remaining Purchase Payments) free of any withdrawal charges.
The free 10% may also apply to redemptions made after the Annuity Date. See ANNUITIZATION – Choosing Your Annuity Option – Annuity Options for Free Withdrawal amounts that apply to redemptions after the Annuity Date.
Qualified Contracts have special restrictions on withdrawals. For purposes of determining the free withdrawal amounts, withdrawal of mandatory required distributions from certain Qualified Contracts are included within the calculations. For additional information, see Special Restrictions Under Qualified Plans below.
Pre-Authorized Withdrawals
If your Contract Value is at least $5,000, you may select the pre-authorized withdrawal option, and you may choose monthly, quarterly, semi-annual or annual withdrawals. Currently, we are not enforcing the minimum Contract Value amount but we reserve the right to enforce the minimum amount in the future. We will provide at least a 30 calendar day prior notice before we enforce the minimum Contract Value amount. Each withdrawal must be for at least $250, except for withdrawals distributed by Electronic Funds Transfer (EFT), which must be at least $100. Each pre-authorized withdrawal is subject to federal income tax on its taxable portion and may be subject to a tax penalty of 10% if you have not reached age 59½. Pre-authorized withdrawals cannot be used to continue the Contract beyond the Annuity Date. See FEDERAL TAX ISSUES and THE GENERAL ACCOUNT. Additional information and options are set forth in the SAI. If you have a guaranteed minimum withdrawal benefit rider in effect, pre-authorized withdrawals cannot take place on your Contract Anniversary.
Special Requirements for Withdrawals and Payments to Third Party Payees
Withdrawals may not be directed to individual third-party payees. If you wish to have a full or partial withdrawal check made payable to a third-party payee that is a financial institution, trust, or charity, you must provide complete instructions and the request may require an original signature and/or signature guarantee.
Special Restrictions Under Qualified Plans
Qualified Plans may have additional rules regarding withdrawals from a Contract purchased under such a Plan. In general, if your Contract was issued under certain Qualified Plans, you may not withdraw amounts attributable to contributions made pursuant to a salary reduction agreement (as defined in Section 402(g)(3)(A) of the Code) except in cases of your:
· severance from employment,
· death,
· disability as defined in Section 72(m)(7) of the Code,
· distributions upon termination of a Qualified Plan,
· reaching age 59½, or
· hardship as defined for purposes of Section 401 of the Code.
These limitations do not affect certain rollovers or exchanges between Qualified Plans, and do not apply to rollovers from these Qualified Plans to an individual retirement account or individual retirement annuity.
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Hardship withdrawals under the exception provided above are restricted to amounts attributable to salary reduction contributions, and do not include investment results. This additional restriction does not apply to salary reduction contributions made, or investment results earned, prior to dates specified in the Code.
Certain distributions, including rollovers, may be subject to mandatory withholding of 20% for federal income tax and to a tax penalty of 10% if the distribution is not transferred directly to the trustee of another Qualified Plan, or to the custodian of an individual retirement account or issuer of an individual retirement annuity. See FEDERAL TAX ISSUES. Distributions may also trigger withholding for state income taxes. The tax and ERISA rules relating to withdrawals from Contracts issued to Qualified Plans are complex. We are not the administrator of any Qualified Plan. You should consult your qualified tax advisor and/or your Plan Administrator before you withdraw any portion of your Contract Value.
Effective Date of Withdrawal Requests
Withdrawal requests we receive before the close of the New York Stock Exchange, which usually closes at 4:00 p.m. Eastern time, will be effective at the end of the same Business Day that we receive them In Proper Form unless the transaction or event is scheduled to occur on another Business Day. We will normally send the proceeds within 7 calendar days after your request is effective. See ADDITIONAL INFORMATION - Timing of Payments and Transactions. If a Purchase Payment is made by check and you submit a withdrawal request immediately afterwards, we may hold the check and the payment of any withdrawal proceeds may be delayed until we receive confirmation in our Service Center that your check has cleared. In general, a delay of the payment of withdrawal proceeds during the check hold period will not exceed ten Business Days after we receive your withdrawal request In Proper Form. If we delay the payment of withdrawal proceeds during the check hold period, we will calculate the value of your withdrawal proceeds as of the end of the Business Day we received your withdrawal request In Proper Form.
Tax Consequences of Withdrawals
All withdrawals, including pre-authorized withdrawals, will generally have federal income tax consequences, which could include tax penalties. You should consult with a qualified tax advisor before making any withdrawal or selecting the pre-authorized withdrawal option. See FEDERAL TAX ISSUES.
You may return your Contract for cancellation and a refund during your Free Look period. Your Free Look period is usually the 10-calendar day period beginning on the calendar day you receive your Contract, but may vary if required by state law or if you are replacing another annuity contract or life insurance policy. The amount of your refund may be more or less than the Purchase Payments you have made. If a Purchase Payment is made by check other than a cashier’s check, we may hold the check and the payment of any refund during the “Right to Cancel” period may be delayed until we receive confirmation in our Service Center that your check has cleared. If you return your Contract and provide cancellation instructions and it is post-marked during the Free Look period, it will be cancelled as of the date we receive your Contract and cancellation instructions In Proper Form. In most states, you will then receive a refund of your Contract Value, based upon the next determined Accumulated Unit Value (AUV) after we receive your Contract for cancellation, plus a refund of any amount that may have been deducted as Contract fees and charges. Your refund amount may be subject to income tax consequences, which include tax penalties. You should consult with a qualified tax advisor before cancelling your Contract for a refund.
In some states we are required to refund your Purchase Payments. If your Contract was issued in such a state and you cancel your Contract during the Free Look period, we will return the greater of your Purchase Payments (less any withdrawals made) or the Contract Value. In addition, if your Contract was issued as an IRA and you return your Contract within 7 calendar days after you receive it, we will return the greater of your Purchase Payments (less any withdrawals made) or the Contract Value, plus any amount that may have been deducted as Contract fees and charges.
Your Purchase Payments are allocated to the Investment Options you indicated on your application, unless otherwise required by state law. If state law requires that your Purchase Payments must be allocated to Investment Options different than you requested (for example, California requires that the initial purchase payment be held in a money market fund if the purchaser is over the age of 60 and chose the return of Purchase Payments option at Contract purchase during the Free Look period), we will comply with state requirements and your Purchase Payments will be held in the Fidelity VIP Government Money Market. At the end of the Free Look period, we will allocate your Purchase Payments based on your allocation instructions.
See ADDITIONAL INFORMATION – State Considerations.
For replacement business, the Free Look period may be extended and the amount returned (Purchase Payment versus Contract Value) may be different than for non-replacement business. Please consult with your financial professional if you have any questions regarding your state’s Free Look period and the amount of any refund.
You will find a complete description of the Free Look period and amount to be refunded that applies to your Contract on the Contract’s cover page. See ADDITIONAL INFORMATION – State Considerations.
If your Contract is issued in exchange for another annuity contract or a life insurance policy, our administrative procedures may vary, depending on the state in which your Contract is issued.
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You must purchase a guaranteed minimum withdrawal benefit rider with this Contract. Riders are subject to availability (including state availability) and may be discontinued for purchase at any time. If we decide to discontinue offering an optional rider, we will amend this Prospectus. Before purchasing any rider, make sure you understand all of the terms and conditions and consult with your financial professional for advice on whether a rider is appropriate for you. Your election to purchase a living benefit rider must be received In Proper Form.
We reserve the right to reject or restrict, at our discretion, any additional Purchase Payments for a rider. If we decide to no longer accept Purchase Payments for any rider, we will not accept subsequent Purchase Payments for your Contract and you will not be able to increase your Contract Value or increase any protected amounts under your living benefit rider by making additional Purchase Payments into your Contract. We may reject or restrict additional Purchase Payments to help protect our ability to provide the guarantees under these riders (for example, changes in current economic factors or general market conditions). If we decide to no longer accept Purchase Payments, we will provide at least 30 calendar days advance written notice. See the Subsequent Purchase Payments subsection of the riders for additional information.
Living benefit riders available through this Contract, for an additional cost, are categorized as guaranteed minimum withdrawal benefit riders. The following is a list of riders currently available:
Guaranteed Minimum Withdrawal Benefit
· Future Income Generator (Single or Joint)
· Enhanced Income Select 2 (Single or Joint)
The guaranteed minimum withdrawal benefit riders focus on providing an income stream for life through withdrawals during the accumulation phase, if certain conditions are met. The riders vary in the percentage that may be withdrawn each year, how long the withdrawals may last (for example, for a single life or for joint lives), or if you can carry over any allowed withdrawal amounts not withdrawn in a prior Contract Year. The riders also offer the potential to lock in market gains on each Contract Anniversary, which are used to calculate annual rider withdrawal limits. Such “locked-in” market gains are not added to the Contract Value, withdrawable as a lump sum, payable as a death benefit, or used in calculating any annuity option under the Contract before the maximum Annuity Date but may increase the annual amount you may withdraw each year under the rider. If the Designated Life (or youngest Designated Life for joint versions) is at or above age 59½, the riders provide an income stream regardless of market performance, even if your Contract Value is reduced to zero (such as through withdrawals (except Excess Withdrawals), fees, or market performance). If the Designated Life (youngest Designated Life for joint versions) is below age 59½ and your Contract Value goes to zero (such as through withdrawals, fees, or market performance) the rider will terminate.
Withdrawals made under the riders are from the Contract Owner’s Contract Value until the Contract Value goes to zero. We are only required to make lifetime income payments to the Contract Owner once the Contract Value is reduced to zero (except due to Early and Excess Withdrawals), which may not occur.
Below is a comparison of some of the guaranteed minimum withdrawal benefit rider features. Working with your financial professional, see the individual rider descriptions after this section for complete information about each rider and its features and benefits.
Future Income Generator (Single or Joint) | Enhanced Income Select 2 (Single or Joint) | |
Purchase | At Contract issue | At Contract issue |
Investment Option Limitations | YES – Contract Value must be allocated according to the Investment Allocation Requirements described below. | YES – Contract Value must be allocated according to the Investment Allocation Requirements described below. |
Maximum Issue Age | 85 or younger | 85 or younger |
Lifetime Withdrawals | YES | YES |
Age Lifetime | 59½ (the youngest | 59½ (the youngest |
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Future Income Generator (Single or Joint) | Enhanced Income Select 2 (Single or Joint) | |
Withdrawals Begin | Designated Life for Joint rider) | Designated Life for Joint rider) |
Annual Credit | YES | YES |
Income Rollover Amount | NO | YES |
Guaranteed Withdrawal Percentage | Before Age 59½ 0% See Rate Sheet Supplement applicable to your Contract | Before Age 59½ 0% See Rate Sheet Supplement applicable to your Contract |
Resets | YES – Automatic or Owner-Elected | YES – Automatic or Owner-Elected |
Exchanges Between Single and Joint Riders | NO | NO |
Spousal Continuation of Single Rider | NO | NO – But may repurchase rider on any subsequent Contract Anniversary |
Loans | NO | NO |
Termination by Request | NO | NO |
You can find complete information about each rider and its key features and benefits below.
You must purchase a living benefit rider on the Contract Date. Your purchase of a living benefit rider must be received In Proper Form. You can find complete purchasing and eligibility information about each living benefit rider in the Purchasing Your Rider subsection of each rider.
Distributions made due to a request for partial annuitization, divorce instructions or under Code Section 72(t)/72(q) (substantially equal periodic payments) are treated as withdrawals for Contract purposes and may adversely affect rider benefits.
Taking a withdrawal before 59 ½ , during the term which an annual credit may be applied, or a withdrawal that is greater than the annual withdrawal amount (“excess withdrawal”) under a particular rider may result in adverse consequences such as a permanent reduction in rider benefits, the failure to receive lifetime withdrawals under a rider, or termination of the rider. If you would like to make an excess withdrawal and are uncertain how an excess withdrawal will reduce your future guaranteed withdrawal amounts, then you may contact us prior to requesting the withdrawal to obtain a personalized, transaction specific calculation showing the effect of the excess withdrawal.
The living benefit riders allow for owner elected Resets. If you elect to Reset, your election must be received, In Proper Form, within 60 calendar days after the Contract Anniversary (“60 day period”) on which the Reset is effective. We may, at our sole discretion, allow Resets after the 60 calendar day period. We reserve the right to refuse a Reset request after the 60 calendar day period regardless of whether we may have allowed you or others to Reset in the past. Each Contract Anniversary starts a new 60 calendar day period in which a Reset may be elected.
Some broker/dealers may limit their clients from purchasing some living benefit riders based upon the client’s age or other factors. You should work with your financial professional to decide whether a living benefit rider is appropriate for you.
Work with your financial professional to review the different riders available for purchase, how they function, how the riders differ from one another, and to understand all of the terms and conditions of a living benefit rider prior to purchase.
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Investment Allocation Requirements
You must allocate your entire Contract Value to Investment Options we make available for these Riders. You may allocate your Contract Value 100% among the allowable Investment Options. You may also use the DCA Plus program to transfer amounts to Investment Options listed below.
Allowable Investment Options |
All available Investment Options are allowable Investment Options for rider purposes. However, the Fidelity VIP Government Money Market is only available for investment by California applicants age 60 or older during the Right to cancel “Free Look” period. The money market can also be used in the event an allowable Investment Option is liquidated by a Fund.
You may transfer your entire Contract Value between an allowable Investment Options, subject to certain transfer limitations and availability. See HOW YOUR PURCHASE PAYMENTS ARE ALLOCATED – Transfers and Market-timing Restrictions.
We currently do not offer any asset allocation programs or models. We reserve the right to add an asset allocation model or program as an additional optional Investment Option in the future and add, remove or change allowable Investment Options at any time. We may make such a change due to a fund reorganization, fund substitution, to help protect our ability to provide the guarantees under these riders (for example, changes in an underlying portfolio’s investment objective and principal investment strategies, or changes in general market conditions), or otherwise. Generally, a change to an existing allowable Investment Option will not require you to reallocate or transfer the total amount of Contract Value allocated to an affected Investment Option, except when an underlying portfolio is liquidated by a determination of its Board of Directors or by a fund substitution. If a change is required that will result in a reallocation or transfer of an existing Investment Option, we will provide you with reasonable notice (generally 90 calendar days) prior to the effective date of such change to allow you to reallocate your Contract Value.
Certain of the asset allocation portfolios that are allowable Investment Options, including the Pacific Select Fund asset allocation portfolios, may use futures and options to reduce the portfolios’ equity exposure during periods when market indicators suggest high market volatility. This strategy is designed to reduce the risk of market losses from investing in equity securities. However, this strategy may result in periods of underperformance, including periods when specified benchmark indexes are appreciating but market volatility is high. As a result, your Contract Value may increase less than it would have without these defensive actions.
Multiple Rider Ownership
Only one guaranteed minimum withdrawal benefit rider may be owned or in effect at the same time.
Withdrawal Benefit Rider Exchanges
Currently, no withdrawal benefit rider exchanges between riders are available, including between (Single) or (Joint) versions of the same withdrawal benefit rider.
Rate Sheet Prospectus Supplement
A Rate Sheet Prospectus Supplement is currently used for the Future Income Generator and Enhanced Income Select 2 (Single) and (Joint) Riders. This supplement is a periodic supplement to the prospectus that discloses the Annual Charge Percentage, Annual Credit Percentage, and Withdrawal Percentages for the Future Income Generator (Single) or (Joint) and the Annual Charge Percentage, Annual Credit Percentage, Enhanced Income Percentages and the Guaranteed Lifetime Income Percentage for the Enhanced Income Select 2 (Single) or (Joint) riders. You can obtain current percentage rates by calling your financial professional, visiting www.PacificLife.com, or by calling us at (800) 722-4448.
To receive the applicable percentages in a supplement, your application must be signed on or after the date referenced in the supplement, your application must be received, In Proper Form, within 14-calendar days after the date you sign your application, and we must receive, In Proper Form, the initial Purchase Payment within 60-calendar days after the date you sign your application. Once the Rider is issued, your percentages will not change as long as you own the Rider (even if an automatic reset or owner-elected reset occurs as described in the Reset of Protected Payment Base subsection of each Rider).
We will periodically issue new supplements that may reflect percentages that may be higher or lower than the percentages in a previous supplement.
Subject to meeting the timelines referenced in the applicable supplement, on the issue date, if the rates we are currently offering have changed since the date you signed your application, the following will apply:
· If the Annual Credit Percentage increased, you will receive the higher percentage in effect on the issue date.
· If any Withdrawal Percentage or Enhanced Income Percentage increased, you will receive the higher percentages in effect on the issue date.
· If the Guaranteed Lifetime Income Percentage increased, you will receive the higher percentage in effect on the issue date.
· If the Annual Charge Percentage decreased, you will receive the lower percentage in effect on your issue date.
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However, for the Future Income Generator, if the Annual Credit and/or any Withdrawal Percentage decreased, or the Annual Charge Percentage increased, you will receive the Annual Credit, Withdrawal and Annual Charge Percentages in effect on the date you signed your application. For the Enhanced Income Select 2, if the Annual Credit, any Enhanced Income Percentage and/or Guaranteed Lifetime Income Percentage decreased, or the Annual Charge Percentage increased, you will receive the Annual Credit, Enhanced Income, Guaranteed Lifetime Income and Annual Charge Percentages in effect on the date you signed your application.
If the necessary paperwork and initial Purchase Payment are not received within the timeframes stated in the applicable supplement, you will receive the applicable percentages in effect as of the Contract issue date.
If you purchased a Rider, review the Rate Sheet Prospectus Supplement provided to you at Contract issue, review the rider specifications page you receive for your Contract, speak with your financial professional, or call us at (800) 722-4448 to confirm the percentages applicable to you.
Rate Sheet Prospectus Supplements (for periods on and after May 1, 2021) may be found in the front of this prospectus.
Future Income Generator (Single)
(This Rider is called the Guaranteed Withdrawal Benefit XXII Rider – Single Life in the Contract’s Rider.)
Purchasing the Rider
Prior to purchase, you must obtain our approval if your initial Protected Payment Base is $1,000,000 or greater.
You may purchase this Rider only on the Contract Date, provided that on the Rider Effective Date:
· the Designated Life is 85 years of age or younger, and
· the Owner and Annuitant is the same person (except for Non-Natural Owners),
· the Contract is not issued as an Inherited IRA, Inherited Roth IRA, Inherited TSA or Non-Qualified Life Expectancy (Stretch), and
· you allocate your entire Contract Value according to the Investment Allocation Requirements.
Joint Owners may not purchase this Rider.
Rider Terms
Annual Credit – An amount added to the Protected Payment Base. The Annual Credit Percentage is disclosed in the Rate Sheet Prospectus Supplement applicable to your Contract.
Annual RMD Amount – The amount required to be distributed each Calendar Year for purposes of satisfying the minimum distribution requirements of Code Section 401(a)(9) (“Section 401(a)(9)”) and related Treasury Regulations.
Designated Life – The person upon whose life the benefits of this Rider are based. The Owner/Annuitant (the Annuitant in the case of a Non-Natural Owner) will be the Designated Life. The Designated Life cannot be changed.
Early Withdrawal – Any withdrawal that occurs before the Designated Life is 59½ years of age.
Excess Withdrawal – Any withdrawal (except an RMD Withdrawal) that occurs after the Designated Life is age 59½ or older and exceeds the Protected Payment Amount.
Protected Payment Amount – The maximum amount that can be withdrawn in a Contract Year under this Rider without reducing the Protected Payment Base. The initial Protected Payment Amount will depend on the age of the Designated Life. If the Designated Life is younger than 59½ years of age, the Protected Payment Amount is equal to zero (0); however, once the Designated Life reaches age 59½, the Protected Payment Amount will be determined using the age at the time of the first withdrawal or the first withdrawal after an Automatic or Owner-Elected Reset. If the Designated Life is 59½ years of age or older, the Protected Payment Amount is the Withdrawal Percentage multiplied by the Protected Payment Base, less Withdrawals made during the Contract Year. In any event, the Protected Payment Amount will never be less than zero (0). The Withdrawal Percentages are disclosed in the Rate Sheet Prospectus Supplement applicable to your Contract.
Protected Payment Base – An amount used to determine the Protected Payment Amount. The Protected Payment Base will remain unchanged except as otherwise described under the provisions of this Rider. The initial Protected Payment Base is equal to the initial Purchase Payment. See Example 1 in the FUTURE INCOME GENERATOR (SINGLE & JOINT) SAMPLE CALCULATIONS APPENDIX for a numerical example of initial values. The Protected Payment Base will never be less than zero (0).
Reset Date – Any Contract Anniversary after the Rider Effective Date on which an Automatic Reset or an Owner-Elected Reset occurs.
Rider Effective Date – The date the guarantees and charges for the Rider become effective; the Contract Date.
Withdrawal Percentage – This percentage is used to determine the Protected Payment Amount. The applicable Withdrawal Percentage is based on the age of the Designated Life at the time the first withdrawal, or the first withdrawal after an Automatic Reset
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or Owner-elected reset occurs. The Withdrawal Percentages are disclosed in the Rate Sheet Prospectus Supplement applicable to your Contract.
Annual Credit
On each Contract Anniversary after the Rider Effective Date, an Annual Credit will be applied to the Protected Payment Base until the earlier of:
· the first withdrawal since the Rider Effective Date, or
· 10 Contract Anniversaries from the Rider Effective Date.
Prior to an Automatic or Owner-Elected Reset, the Annual Credit amount is equal to the Annual Credit Percentage multiplied by the total Purchase Payments received. Once an Automatic or Owner-Elected Reset takes place, the Annual Credit amount is equal to the reset Protected Payment Base plus any subsequent Purchase Payments multiplied by the Annual Credit Percentage. See Example 2 in the FUTURE INCOME GENERATOR (SINGLE & JOINT) SAMPLE CALCULATIONS APPENDIX for a numerical example of the Annual Credit calculation. Once a withdrawal (including an RMD withdrawal) or 10 Contract Anniversaries has occurred, as measured from the Rider Effective Date, no Annual Credit will be added to the Protected Payment Base. In addition, Annual Credit eligibility cannot be reinstated/restarted by any Automatic or Owner-Elected Reset. Any Annual Credit added during any Contract Year before Annual Credit eligibility is lost will continue to be counted in the Protected Payment Base. The Annual Credit Percentage is disclosed in the Rate Sheet Prospectus Supplement applicable to your Contract.
You will find information about an RMD Withdrawal in the Required Minimum Distributions subsection and information about Automatic Resets and Owner-Elected Resets in the Reset of Protected Payment Base subsection below.
How the Rider Works
Beginning at age 59½, this Rider guarantees you can withdraw up to the Protected Payment Amount, regardless of market performance, until the Rider terminates. This Rider provides for an amount (an “Annual Credit”) to be added to the Protected Payment Base. The Rider provides for Automatic Resets of the Protected Payment Base to an amount equal to 100% of the Contract Value (if the Protected Payment Base is at least $1.00 less than the Contract Value on that Contract Anniversary). If there is an Annual Credit Amount applied, it is added to the Protected Payment Base before any reset determination is made. Once the Rider is purchased, you cannot request a termination of the Rider (see the Termination subsection of this Rider for more information).
If the Designated Life is 59½ years of age or older, the Protected Payment Amount is the applicable Withdrawal Percentage (as disclosed in the Rate Sheet Prospectus Supplement applicable to your Contract) multiplied by the Protected Payment Base, less any withdrawals made during the current Contract Year. If the Designated Life is younger than 59½ years of age, the Protected Payment Amount is zero (0). Any allowable Protected Payment Amount remaining at the end of a Contract Year cannot be withdrawn during any following Contract Year.
If applicable, an Annual Credit is added to the Protected Payment Base prior to any Automatic Reset. If the Contract Value as of that Contract Anniversary is greater than the Protected Payment Base (which includes the Annual Credit amount), then the Protected Payment Base will be automatically reset to equal the Contract Value.
The Protected Payment Base may change over time. The Protected Payment Base can be changed by subsequent Purchase Payments, the Annual Credit, Automatic or Owner-Elected Resets or by certain withdrawals. Here are ways the Protected Payment Base may change:
· The Protected Payment Base is increased by the full amount of any subsequent Purchase Payments made during the Contract Year.
· For the first 10 years from the Rider Effective Date, the Protected Payment Base will be increased by the Annual Credit amount, as long as no withdrawals are made. If you take any type of withdrawal within the first 10 years from the Rider Effective Date, the Annual Credit will no longer affect the Protected Payment Base. Any Annual Credit added during the Contract Years before the withdrawal will remain in the Protected Payment Base.
· An Automatic Reset (if the Protected Payment base is at least $1.00 less than the Contract Value on that Contract Anniversary) will increase the Protected Payment Base. An Owner-Elected Reset will increase or decrease the Protected Payment Base depending on the Contract Value on the Reset Date. See Reset of Protected Payment Base subsection.
· A withdrawal that is less than or equal to the amount allowed each Contract Year (the Protected Payment Amount) will not change the Protected Payment Base. However, if a withdrawal is greater than the Protected Payment Amount and the Contract Value (less the Protected Payment Amount) is lower than the Protected Payment Base at the time of withdrawal, the Protected Payment Base will be reduced by an amount that is greater than the excess amount withdrawn. For withdrawals that are greater than the Protected Payment Amount, see the Withdrawal of Protected Payment Amount subsection. See Examples 3 and 4 of the FUTURE INCOME GENERATOR (SINGLE & JOINT) SAMPLE CALCULATIONS APPENDIX for numerical examples of withdrawals and the effect on the Protected Payment Base.
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The Protected Payment Base cannot be withdrawn as a lump sum, is not payable as a death benefit, and is not used in calculating any annuity option available under the Contract before the maximum Annuity Date. See Annuitization subsection.
For purposes of this Rider, the term "withdrawal" includes any applicable withdrawal charges and taxes (there is no charge for the Protected Payment Amount allowed under the rider). Amounts withdrawn under this Rider will reduce the Contract Value by the amount withdrawn and will be subject to the same conditions, limitations, restrictions and all other fees, charges and deductions, if applicable, as withdrawals otherwise made under the provisions of the Contract. If the withdrawal amount is requested on a net basis, the Contract Owner must account for any charges and taxes to ensure that the gross withdrawal amount does not exceed the Protected Payment Amount. Unless you specify otherwise, a partial withdrawal amount requested will be processed as a gross amount. Withdrawals under this Rider are not annuity payouts. Annuity payouts generally receive a more favorable tax treatment than other withdrawals.
If your Contract is a Qualified Contract, including an IRA Contract, you are subject to restrictions on withdrawals you may take prior to a triggering event (e.g. reaching age 59½, separation from service, disability) and you should consult your tax or legal advisor prior to purchasing this Contract and optional rider, the primary benefit of which is guaranteeing withdrawals. For additional information regarding withdrawals and triggering events, see FEDERAL TAX ISSUES – IRAs and Qualified Plans.
Withdrawal of Protected Payment Amount
When the Designated Life is 59½ years of age or older, you may withdraw up to the Protected Payment Amount each Contract Year, regardless of market performance, until the Rider terminates. The Protected Payment Amount will be reduced by the amount withdrawn during the Contract Year, inclusive of any applicable charges and taxes, and will be reset each Contract Anniversary. Any portion of the Protected Payment Amount not withdrawn during a Contract Year may not be carried over to the next Contract Year. If a withdrawal does not exceed the Protected Payment Amount immediately prior to that withdrawal, the Protected Payment Base will remain unchanged.
Withdrawals Exceeding the Protected Payment Amount. If a withdrawal (except an RMD Withdrawal) exceeds the Protected Payment Amount immediately prior to that withdrawal, we will (immediately following the withdrawal) reduce the Protected Payment Base on a proportionate basis for the amount in excess of the Protected Payment Amount. Withdrawals that exceed the Protected Payment Amount may have the effect of reducing future benefits by more than the dollar amount of the withdrawal. (See Example 4 in the FUTURE INCOME GENERATOR (SINGLE & JOINT) SAMPLE CALCULATIONS APPENDIX for a numerical example of the adjustments to the Protected Payment Base as a result of an Excess Withdrawal.) If a withdrawal is greater than the Protected Payment Amount and the Contract Value (less the Protected Payment Amount) is lower than the Protected Payment Base, the Protected Payment Base will be reduced by an amount that is greater than the excess amount withdrawn.
If you request a withdrawal that is greater than the Protected Payment Amount, you must have Contract Value that is equal to or greater than the withdrawal amount requested or your Rider will terminate (see the Depletion of Contract Value subsection below).
For information regarding taxation of withdrawals, see FEDERAL TAX ISSUES.
Early Withdrawal
If an Early Withdrawal occurs, we will (immediately following the Early Withdrawal) reduce the Protected Payment Base either on a proportionate basis or by the total withdrawal amount, whichever results in a lower Protected Payment Base. Early Withdrawals may have the effect of reducing future benefits by more than the dollar amount of the withdrawal. See Example 5 in the FUTURE INCOME GENERATOR (SINGLE & JOINT) SAMPLE CALCULATIONS APPENDIX for a numerical example of the adjustments to the Protected Payment Base as a result of an Early Withdrawal.
Required Minimum Distributions
No adjustment will be made to the Protected Payment Base as a result of a withdrawal that exceeds the Protected Payment Amount immediately prior to the withdrawal, provided:
· such withdrawal (an “RMD Withdrawal”) is for purposes of satisfying the minimum distribution requirements of Section 401(a)(9) and related Treasury Regulations,
· you have authorized us to calculate and make periodic distribution of the Annual RMD Amount for the Calendar Year required based on the payment frequency you have chosen,
· the Annual RMD Amount is based on the previous year-end fair market value of this Contract only, and
· only RMD withdrawals are made from the Contract during the Contract Year.
Once a withdrawal occurs, including an RMD Withdrawal, no Annual Credit will be added to the Protected Payment Base. In addition, Annual Credit eligibility cannot be reinstated/restarted by any Automatic or Owner-Elected Reset. Any Annual Credit added during any Contract Year before Annual Credit eligibility is lost will continue to be counted in the Protected Payment Base.
We reserve the right to modify or eliminate the treatment of RMD Withdrawals under this Rider if there is any change to the Internal Revenue Code or Treasury Regulations relating to required minimum distributions, including the issuance of relevant IRS guidance. If we exercise this right, we will provide 30 days advance notice to the Owner.
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See Example 6 in the FUTURE INCOME GENERATOR (SINGLE & JOINT) SAMPLE CALCULATIONS APPENDIX for numerical examples that describe what occurs when only withdrawals of the Annual RMD Amount are made during a Contract Year and when withdrawals of the Annual RMD Amount plus other non-RMD Withdrawals are made during a Contract Year.
Also see FEDERAL TAX ISSUES – Qualified Contracts – Required Minimum Distributions.
Depletion of Contract Value
If the Designated Life is younger than age 59½ when the Contract Value is zero (such as through withdrawals, fees, or market performance), the Rider will terminate.
If the Designated Life is age 59½ or older and the Contract Value was reduced to zero by a withdrawal that exceeds the Protected Payment Amount (excluding an RMD withdrawal), the Rider will terminate.
If the Designated Life is age 59½ or older and the Contract Value was reduced to zero by a withdrawal that did not exceed the Protected Payment Amount (except that an RMD Withdrawal may exceed the Protected Payment Amount), fees, or market performance, the following will apply:
· the allowable withdrawal amount from the Contract beginning in the Contract Year that the Contract Value is reduced to zero will be limited to the Protected Payment Amount which will be paid automatically each year until the date of death of the Designated Life,
· the Protected Payment Amount will be paid under a series of pre-authorized withdrawals under a payment frequency as elected by the Owner, but no less frequently than annually, until the rider is terminated (see the Termination subsection),
· no additional Purchase Payments will be accepted under the Contract, and
· the Contract will cease to provide any death benefit (amount will be zero).
Reset of Protected Payment Base
On and after each Reset Date, the provisions of this Rider shall apply in the same manner as they applied when the Rider was originally issued except that an Automatic Reset or an Owner-Elected Reset will not reinstate eligibility for the Annual Credit as described above. The limitations and restrictions on Purchase Payments and withdrawals, the deduction of Rider charges and any future reset options available on and after the Reset Date, will again apply and will be measured from that Reset Date. A reset occurs when the Protected Payment Base is changed to an amount equal to the Contract Value as of the Reset Date.
Automatic Reset. On each Contract Anniversary, while this Rider is in effect and before the Annuity Date, we will automatically reset the Protected Payment Base to an amount equal to 100% of the Contract Value, if the Protected Payment Base, after any Annual Credit is applied, is at least $1.00 less than the Contract Value on that Contract Anniversary. See Example 7 in the FUTURE INCOME GENERATOR (SINGLE & JOINT) SAMPLE CALCULATIONS APPENDIX for a numerical example of an Automatic Reset.
Owner-Elected Resets (Non-Automatic). You may, on any Contract Anniversary, elect to reset the Protected Payment Base to an amount equal to 100% of the Contract Value. An Owner-Elected Reset may be elected while Automatic Resets are in effect.
If you elect this option, your election must be received, In Proper Form, within 60 calendar days after the Contract Anniversary on which the reset is effective. The reset will be based on the Contract Value as of that Contract Anniversary. Your election of this option may result in a reduction in the Protected Payment Base, Protected Payment Amount and any Annual Credit that may be applied. Generally, the reduction will occur when your Contract Value is less than the Protected Payment Base as of the Contract Anniversary you elected the reset. There may be situations where you may want to elect an Owner-Elected Reset. For example, one scenario where an Owner-Elected Reset may be used is when no Automatic Resets have occurred and the Designated Life has reached a higher age band (e.g. was 64 years of age and turned 65). The attainment of a higher age band may provide for a higher Withdrawal Percentage which could provide a higher annual withdrawal amount. See Example 8 in the FUTURE INCOME GENERATOR (SINGLE & JOINT) SAMPLE CALCULATIONS APPENDIX for a numerical example how an Owner-Elected Reset may be used in this situation. You are strongly advised to work with your financial professional prior to electing an Owner-Elected Reset. We will provide you written confirmation of your election.
Subsequent Purchase Payments
If we accept additional Purchase Payments after the Rider Effective Date, we will increase the Protected Payment Base by the amount of the Purchase Payments. See Example 2 in the FUTURE INCOME GENERATOR (SINGLE & JOINT) SAMPLE CALCULATIONS APPENDIX for a numerical example of adjustments to the Protected Payment Base when an additional Purchase Payment is made. We reserve the right to reject or restrict, at our discretion, any additional Purchase Payments. If we exercise our right to reject or restrict any future Purchase Payments, we will provide 30 days advance notice to the Owner. If we decide to no longer accept Purchase Payments, we will not accept subsequent Purchase Payments for your Contract and any limitations will be applied uniformly to all Contract Owners.
Annuitization
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If you annuitize the Contract at the maximum Annuity Date specified in your Contract and this Rider is still in effect at the time of your election and a Life Only fixed annuity option is chosen, the annuity payments will be equal to the greater of:
· the Life Only fixed annual payment amount based on the terms of your Contract, or
· the Protected Payment Amount in effect at the maximum Annuity Date.
If you annuitize the Contract at any time prior to the maximum Annuity Date specified in your Contract, your annuity payments will be determined in accordance with the terms of your Contract. The Protected Payment Base and Protected Payment Amount under this Rider will not be used in determining any annuity payments and your annuity payments received may be less than the Protected Payment Amount you are entitled to receive for life under the Rider. Work with your financial professional to determine if you should annuitize your Contract before the maximum Annuity Date or stay in the accumulation phase and continue to take withdrawals under the Rider.
Continuation of Rider if Surviving Spouse Continues Contract
This Rider terminates upon the death of the Designated Life or when a death benefit becomes payable under the Contract, whichever occurs first. If the surviving spouse continues the Contract, the surviving spouse may not re-purchase this Rider, any payments under the Rider will cease, and the Rider will terminate The surviving spouse may elect to receive any death benefit proceeds instead of continuing the Contract (see DEATH BENEFITS AND OPTIONAL DEATH BENEFIT RIDERS - Death Benefits).
Termination
You cannot request a termination of the Rider. Except as otherwise provided below, the Rider will automatically terminate on the earliest of:
· the date of the death of the Designated Life or when a death benefit becomes payable under the Contract,
· the day the Contract is terminated in accordance with the provisions of the Contract,
· the day we are notified of an ownership change of a Non-Qualified Contract (excluding ownership changes: to or from certain trusts, adding or removing the Owner's spouse, or for Riders issued in California),
· the Annuity Date (see the Annuitization subsection for additional information),
· the day the Contract Value is reduced to zero (0) as a result of an Excess Withdrawal (see Rider Terms), or
· the day the Contract Value is reduced to zero (0) (such as through withdrawals, fees, or market performance) if the Designated Life is younger than age 59½.
See the Depletion of Contract Value subsection for situations where the Rider will not terminate when the Contract Value is reduced to zero.
Sample Calculations
Hypothetical sample calculations are in the attached FUTURE INCOME GENERATOR (SINGLE & JOINT) SAMPLE CALCULATIONS APPENDIX. The examples are based on certain hypothetical assumptions and are for example purposes only. These examples are not intended to serve as projections of future investment returns.
Future Income Generator (Joint)
(This Rider is called the Guaranteed Withdrawal Benefit XXII Rider – Joint Life in the Contract’s Rider.)
Purchasing the Rider
Prior to purchase, you must obtain our approval if your initial Protected Payment Base is $1,000,000 or greater.
You may purchase this Rider only on the Contract Date, if you meet the following eligibility requirements:
· the Contract is issued as:
· Non-Qualified Contract (this Rider is not available if this is a post-death Non-Qualified Contract, the Owner is a trust or other entity), or
· Qualified Contract under Code Section 408(a), 408(k), 408A, 408(p), except for Inherited IRAs, Inherited Roth IRAs, or Inherited TSAs, 401(a), 401(k), Individual(k), Keogh, or 457 plan.
· both Designated Lives are 85 years or younger,
· the Contract must be structured so that upon the death of one Designated Life, the surviving Designated Life may retain or assume ownership of the Contract, and
· any Owner/Annuitant is a Designated Life (except for custodial owned IRA).
For purposes of meeting the eligibility requirements, Designated Lives must be any one of the following:
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· a sole Owner with the Owner’s Spouse designated as the sole primary Beneficiary,
· Joint Owners, where the Owners are each other’s Spouses, or
· if the Contract is issued as a custodial owned IRA, the beneficial owner must be the Annuitant and the Annuitant’s Spouse must be designated as the sole primary Beneficiary under the Contract. The custodian, under a custodial owned IRA, for the benefit of the beneficial owner, may be designated as sole primary Beneficiary provided that the Spouse of the beneficial owner is the sole primary Beneficiary of the custodial account.
Naming your Spouse as the Beneficiary to meet eligibility requirements will not be considered a change of Annuitant on the Contract.
Rider Terms
Annual Credit – An amount added to the Protected Payment Base. The Annual Credit Percentage is disclosed in the Rate Sheet Prospectus Supplement applicable to your Contract.
Annual RMD Amount – The amount required to be distributed each Calendar Year for purposes of satisfying the minimum distribution requirements of Code Section 401(a)(9) (“Section 401(a)(9)”) and related Treasury Regulations.
Designated Lives (each a “Designated Life”) – Designated Lives must be natural persons who are each other’s spouses on the Rider Effective Date. Designated Lives will remain unchanged while this Rider is in effect.
To be eligible for lifetime benefits, the Designated Life must:
· be the Owner (or Annuitant, in the case of a custodial owned IRA), or
· remain the Spouse of the other Designated Life and be the first in line of succession, as determined under the Contract, for payment of any death benefit.
Early Withdrawal – Any withdrawal that occurs before the youngest Designated Life is 59½ years of age.
Excess Withdrawal – Any withdrawal (except an RMD Withdrawal) that occurs after the youngest Designated Life is age 59½ or older and exceeds the Protected Payment Amount.
Protected Payment Amount – The maximum amount that can be withdrawn in a Contract Year under this Rider without reducing the Protected Payment Base. The initial Protected Payment Amount will depend on the age of the youngest Designated Life. If the youngest Designated Life is younger than 59½ years of age, the Protected Payment Amount is equal to zero (0); however, once the youngest Designated Life reaches age 59½, the Protected Payment Amount will be determined using the age at the time of the first withdrawal or the first withdrawal after an Automatic or Owner-Elected Reset. If the youngest Designated Life is 59½ years of age or older, the Protected Payment Amount is the Withdrawal Percentage multiplied by the Protected Payment Base less Withdrawals made during the Contract Year. In any event, the Protected Payment Amount will never be less than zero (0). The Withdrawal Percentages are disclosed in the Rate Sheet Prospectus Supplement applicable to your Contract.
Protected Payment Base – An amount used to determine the Protected Payment Amount. The Protected Payment Base will remain unchanged except as otherwise described under the provisions of this Rider. The initial Protected Payment Base is equal to the initial Purchase Payment. See Example 1 in the FUTURE INCOME GENERATOR (SINGLE & JOINT) SAMPLE CALCULATIONS APPENDIX for a numerical example of initial values. The Protected Payment Base will never be less than zero (0).
Reset Date – Any Contract Anniversary after the Rider Effective Date on which an Automatic Reset or an Owner-Elected Reset occurs.
Rider Effective Date – The date the guarantees and charges for the Rider become effective; the Contract Date.
Spouse – The Owner’s spouse who is treated as the Owner’s spouse pursuant to federal law. If the Contract is a custodial owned IRA, the Annuitant’s spouse who is treated as the Annuitant’s spouse pursuant to federal law.
Surviving Spouse – The surviving spouse of a deceased Owner (or Annuitant in the case of a custodial owned IRA).
Withdrawal Percentage – This percentage is used to determine the Protected Payment Amount. The applicable Withdrawal Percentage is based on the age of the youngest Designated Life at the time the first withdrawal, or the first withdrawal after an Automatic Reset or Owner-elected reset occurs. The Withdrawal Percentage is disclosed in the Rate Sheet Prospectus Supplement applicable to your Contract.
Annual Credit
On each Contract Anniversary after the Rider Effective Date, an Annual Credit will be applied to the Protected Payment Base until the earlier of:
· the first withdrawal since the Rider Effective Date, or
· 10 Contract Anniversaries from the Rider Effective Date.
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Prior to an Automatic or Owner-Elected Reset, the Annual Credit amount is equal to the Annual Credit percentage multiplied by the total Purchase Payments received. Once an Automatic or Owner-Elected Reset takes place, the Annual Credit amount is equal to the reset Protected Payment Base plus any subsequent Purchase Payments multiplied by the Annual Credit Percentage. See Example 2 in the FUTURE INCOME GENERATOR (SINGLE & JOINT) SAMPLE CALCULATIONS APPENDIX for a numerical example of the Annual Credit calculation. Once a withdrawal (including an RMD withdrawal) or 10 Contract Anniversaries has occurred, as measured from the Rider Effective Date, no Annual Credit will be added to the Protected Payment Base. In addition, Annual Credit eligibility cannot be reinstated/restarted by any Automatic or Owner-Elected Reset. Any Annual Credit added during any Contract Year before Annual Credit eligibility is lost will continue to be counted in the Protected Payment Base. The Annual Credit Percentage is disclosed in the Rate Sheet Prospectus Supplement applicable to your Contract.
You will find information about an RMD Withdrawal in the Required Minimum Distributions subsection and information about Automatic Resets and Owner-Elected Resets in the Reset of Protected Payment Base subsection below.
How the Rider Works
Beginning at age 59½, this Rider guarantees you can withdraw up to the Protected Payment Amount, regardless of market performance, until the Rider terminates. This Rider provides for an amount (an “Annual Credit”) to be added to the Protected Payment Base. The Rider provides for Automatic Resets of the Protected Payment Base to an amount equal to 100% of the Contract Value (if the Protected Payment Base is at least $1.00 less than the Contract Value on that Contract Anniversary). If there is an Annual Credit amount applied, it is added to the Protected Payment Base before any reset determination is made. Once the Rider is purchased, you cannot request a termination of the Rider (see the Termination subsection of this Rider for more information).
If the youngest Designated Life is 59½ years of age or older, the Protected Payment Amount is the applicable Withdrawal Percentage (as disclosed in the Rate Sheet Prospectus Supplement applicable to your Contract) multiplied by the Protected Payment Base less any withdrawals made during the current Contract Year. If the youngest Designated Life is younger than 59½ years of age, the Protected Payment Amount is zero (0). Any allowable Protected Payment Amount remaining at the end of a Contract Year cannot be withdrawn during any following Contract Year.
If applicable, an Annual Credit is added to the Protected Payment Base prior to any Automatic Reset. If the Contract Value as of that Contract Anniversary is greater than the Protected Payment Base (which includes the Annual Credit amount), then the Protected Payment Base will be automatically reset to equal the Contract Value.
The Protected Payment Base may change over time. The Protected Payment Base can be changed by subsequent Purchase Payments, the Annual Credit, Automatic or Owner-Elected Resets or by certain withdrawals. Here are ways the Protected Payment Base may change:
· The Protected Payment Base is increased by the full amount of any subsequent Purchase Payments made during the Contract year.
· For the first 10 years from the Rider Effective Date, the Protected Payment Base will be increased by the Annual Credit amount, as long as no withdrawals are made. If you take any type of withdrawal within the first 10 years from the Rider Effective Date, the Annual Credit will no longer affect the Protected Payment Base. Any Annual Credit added during the Contract Years before the withdrawal will remain in the Protected Payment Base.
· An Automatic Reset (if the Protected Payment base is at least $1.00 less than the Contract Value on that Contract Anniversary) will increase the Protected Payment Base. An Owner-Elected Reset will increase or decrease the Protected Payment Base depending on the Contract Value on the Reset Date. See the Reset of Protected Payment Base subsection.
· A withdrawal that is less than or equal to the amount allowed each Contract Year (the Protected Payment Amount) will not change the Protected Payment Base. However, if a withdrawal is greater than the Protected Payment Amount and the Contract Value (less the Protected Payment Amount) is lower than the Protected Payment Base at the time of withdrawal, the Protected Payment Base will be reduced by an amount that is greater than the excess amount withdrawn. For withdrawals that are greater than the Protected Payment Amount, see the Withdrawal of Protected Payment Amount subsection. See examples 3 and 4 of the FUTURE INCOME GENERATOR (SINGLE & JOINT) SAMPLE CALCULATIONS APPENDIX for numerical examples of withdrawals and the effect on the Protected Payment Base.
The Protected Payment Base cannot be withdrawn as a lump sum, is not payable as a death benefit, and is not used in calculating any annuity option available under the Contract before the maximum Annuity Date. See the Annuitization subsection.
For purposes of this Rider, the term "withdrawal" includes any applicable withdrawal charges and taxes (there is no charge for the Protected Payment Amount allowed under the rider). Amounts withdrawn under this Rider will reduce the Contract Value by the amount withdrawn and will be subject to the same conditions, limitations, restrictions and all other fees, charges and deductions, if applicable, as withdrawals otherwise made under the provisions of the Contract. If the withdrawal amount is requested on a net basis, the Contract Owner must account for any charges and taxes to ensure that the gross withdrawal amount does not exceed the Protected Payment Amount. Unless you specify otherwise, a partial withdrawal amount requested will be processed as a gross amount. Withdrawals under this Rider are not annuity payouts. Annuity payouts generally receive a more favorable tax treatment than other withdrawals.
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If your Contract is a Qualified Contract, including an IRA Contract, you are subject to restrictions on withdrawals you may take prior to a triggering event (e.g. reaching age 59½, separation from service, disability) and you should consult your tax or legal advisor prior to purchasing this Contract and optional rider, the primary benefit of which is guaranteeing withdrawals. For additional information regarding withdrawals and triggering events, see FEDERAL TAX ISSUES – IRAs and Qualified Plans.
Withdrawal of Protected Payment Amount
When the youngest Designated Life is 59½ years of age or older, you may withdraw up to the Protected Payment Amount each Contract Year, regardless of market performance, until the Rider terminates. The Protected Payment Amount will be reduced by the amount withdrawn during the Contract Year, inclusive of any applicable charges and taxes, and will be reset each Contract Anniversary. Any portion of the Protected Payment Amount not withdrawn during a Contract Year may not be carried over to the next Contract Year. If a withdrawal does not exceed the Protected Payment Amount immediately prior to that withdrawal, the Protected Payment Base will remain unchanged.
Withdrawals Exceeding the Protected Payment Amount. If a withdrawal (except an RMD Withdrawal) exceeds the Protected Payment Amount immediately prior to that withdrawal, we will (immediately following the withdrawal) reduce the Protected Payment Base on a proportionate basis for the amount in excess of the Protected Payment Amount. Withdrawals that exceed the Protected Payment Amount may have the effect of reducing future benefits by more than the dollar amount of the withdrawal. (See Example 4 in the FUTURE INCOME GENERATOR (SINGLE & JOINT) SAMPLE CALCULATIONS APPENDIX for a numerical example of the adjustments to the Protected Payment Base as a result of an Excess Withdrawal.) If a withdrawal is greater than the Protected Payment Amount and the Contract Value (less the Protected Payment Amount) is lower than the Protected Payment Base, the Protected Payment Base will be reduced by an amount that is greater than the excess amount withdrawn.
If you request a withdrawal that is greater than the Protected Payment Amount, you must have Contract Value that is equal to or greater than the withdrawal amount requested or your Rider will terminate (see the Depletion of Contract Value subsection below).
For information regarding taxation of withdrawals, see FEDERAL TAX ISSUES.
Early Withdrawal
If an Early Withdrawal occurs, we will (immediately following the Early Withdrawal) reduce the Protected Payment Base either on a proportionate basis or by the total withdrawal amount, whichever results in a lower Protected Payment Base. Early Withdrawals may have the effect of reducing future benefits by more than the dollar amount of the withdrawal. See Example 5 in the FUTURE INCOME GENERATOR (SINGLE & JOINT) SAMPLE CALCULATIONS APPENDIX for a numerical example of the adjustments to the Protected Payment Base as a result of an Early Withdrawal.
Required Minimum Distributions
No adjustment will be made to the Protected Payment Base as a result of a withdrawal that exceeds the Protected Payment Amount immediately prior to the withdrawal, provided:
· such withdrawal (an “RMD Withdrawal”) is for purposes of satisfying the minimum distribution requirements of Section 401(a)(9) and related Treasury Regulations,
· you have authorized us to calculate and make periodic distribution of the Annual RMD Amount for the Calendar Year required based on the payment frequency you have chosen,
· the Annual RMD Amount is based on the previous year-end fair market value of this Contract only,
· only RMD withdrawals are made from the Contract during the Contract Year, and
· the youngest Designated Life is age 59½ or older.
Once a withdrawal occurs, including an RMD withdrawal, no Annual Credit will be added to the Protected Payment Base. In addition, Annual Credit eligibility cannot be reinstated/restarted by any Automatic or Owner-Elected Reset. Any Annual Credit added during any Contract Year before Annual Credit eligibility is lost will continue to be counted in the Protected Payment Base.
We reserve the right to modify or eliminate the treatment of RMD Withdrawals under this Rider if there is any change to the Internal Revenue Code or Treasury Regulations relating to required minimum distributions, including the issuance of relevant IRS guidance. If we exercise this right, we will provide 30 days advance notice to the Owner.
See Example 6 in the FUTURE INCOME GENERATOR (SINGLE & JOINT) SAMPLE CALCULATIONS APPENDIX for numerical examples that describe what occurs when only withdrawals of the Annual RMD Amount are made during a Contract Year and when withdrawals of the Annual RMD Amount plus other non-RMD Withdrawals are made during a Contract Year.
Also see FEDERAL TAX ISSUES – Qualified Contracts – Required Minimum Distributions.
Depletion of Contract Value
If the youngest Designated Life is younger than age 59½ when the Contract Value is zero (such as through withdrawals, fees, or market performance), the Rider will terminate.
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If the youngest Designated Life is age 59½ or older and the Contract Value was reduced to zero by a withdrawal that exceeds the Protected Payment Amount (excluding an RMD withdrawal), the Rider will terminate.
If the youngest Designated Life is age 59½ or older and the Contract Value was reduced to zero by a withdrawal that did not exceed the Protected Payment Amount, (except that an RMD Withdrawal may exceed the Protected Payment Amount), fees, or market performance, the following will apply:
· the allowable withdrawal amount from the Contract beginning in the Contract Year that the Contract Value is reduced to zero will be limited to the Protected Payment Amount which will be paid automatically each year until the death of all Designated Lives eligible for lifetime benefits,
· the Protected Payment Amount will be paid under a series of pre-authorized withdrawals under a payment frequency as elected by the Owner, but no less frequently than annually, until the rider is terminated (see the Termination subsection),
· no additional Purchase Payments will be accepted under the Contract, and
· the Contract will cease to provide any death benefit (amount will be zero).
Reset of Protected Payment Base
On and after each Reset Date, the provisions of this Rider shall apply in the same manner as they applied when the Rider was originally issued except that an Automatic Reset or an Owner-Elected Reset will not reinstate eligibility for the Annual Credit as described above. The limitations and restrictions on Purchase Payments and withdrawals, the deduction of Rider charges and any future reset options available on and after the Reset Date, will again apply and will be measured from that Reset Date. A reset occurs when the Protected Payment Base is changed to an amount equal to the Contract Value as of the Reset Date.
Automatic Reset. On each Contract Anniversary, while this Rider is in effect and before the Annuity Date, we will automatically reset the Protected Payment Base to an amount equal to 100% of the Contract Value, if the Protected Payment Base, after any Annual Credit is applied, is at least $1.00 less than the Contract Value on that Contract Anniversary. See Example 7 in the FUTURE INCOME GENERATOR (SINGLE & JOINT) SAMPLE CALCULATIONS APPENDIX for a numerical example of an Automatic Reset.
Owner-Elected Resets (Non-Automatic). You may, on any Contract Anniversary, elect to reset the Protected Payment Base to an amount equal to 100% of the Contract Value. An Owner-Elected Reset may be elected while Automatic Resets are in effect.
If you elect this option, your election must be received, In Proper Form, within 60 calendar days after the Contract Anniversary on which the reset is effective. The reset will be based on the Contract Value as of that Contract Anniversary. Your election of this option may result in a reduction in the Protected Payment Base, Protected Payment Amount and any Annual Credit that may be applied. Generally, the reduction will occur when your Contract Value is less than the Protected Payment Base as of the Contract Anniversary you elected the reset. There may be situations where you may want to elect an Owner-Elected Reset. For example, one scenario where an Owner-Elected Reset may be used is when no Automatic Resets have occurred and the youngest Designated Life has reached a higher age band (e.g. was 64 years of age and turned 65). The attainment of a higher age band may provide for a higher Withdrawal Percentage which could provide a higher annual withdrawal amount. See Example 8 in the FUTURE INCOME GENERATOR (SINGLE & JOINT) SAMPLE CALCULATIONS APPENDIX for a numerical example how an Owner-Elected Reset may be used in this situation. You are strongly advised to work with your financial professional prior to electing an Owner-Elected Reset. We will provide you written confirmation of your election.
Subsequent Purchase Payments
If we accept additional Purchase Payments after the Rider Effective Date, we will increase the Protected Payment Base by the amount of the Purchase Payments. See Example 2 in the FUTURE INCOME GENERATOR (SINGLE & JOINT) SAMPLE CALCULATIONS APPENDIX for a numerical example of adjustments to the Protected Payment Base when an additional Purchase Payment is made. We reserve the right to reject or restrict, at our discretion, any additional Purchase Payments. If we exercise our right to reject or restrict any future Purchase Payments, we will provide 30 days advance notice to the Owner If we decide to no longer accept Purchase Payments, we will not accept subsequent Purchase Payments for your Contract and any limitations will be applied uniformly to all Contract Owners.
Annuitization
If you annuitize the Contract at the maximum Annuity Date specified in your Contract and this Rider is still in effect at the time of your election and a Life Only or Joint and Survivor Life Only fixed annuity option is chosen, the annuity payments will be equal to the greater of:
· the Life Only or Joint and Survivor Life Only fixed annual payment amount based on the terms of your Contract, or
· the Protected Payment Amount in effect at the maximum Annuity Date.
If you annuitize the Contract at any time prior to the maximum Annuity Date specified in your Contract, your annuity payments will be determined in accordance with the terms of your Contract. The Protected Payment Base and Protected Payment Amount under this Rider will not be used in determining any annuity payments and your annuity payments received may be less than the Protected
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Payment Amount, you are entitled to receive for life under the Rider. Work with your financial professional to determine if you should annuitize your Contract before the maximum Annuity Date or stay in the accumulation phase and continue to take withdrawals under the Rider.
Continuation of Rider if Surviving Spouse Continues Contract
If the Owner dies and the Surviving Spouse (who is also a Designated Life eligible for lifetime benefits) elects to continue the Contract in accordance with its terms, the Surviving Spouse may continue to take withdrawals of the Protected Payment Amount under this Rider, until the Rider terminates. See Termination subsection below. If no withdrawals have occurred after the youngest Designated Life reached age 59½, then the Withdrawal Percentage and corresponding Protected Payment Amount will be based on the age when the Surviving Spouse first takes a withdrawal. The Surviving Spouse may elect any of the reset options available under this Rider for subsequent Contract Anniversaries.
The Surviving Spouse may elect to receive any death benefit proceeds instead of continuing the Contract (see DEATH BENEFITS AND OPTIONAL DEATH BENEFIT RIDERS – Death Benefits).
Ownership and Beneficiary Changes
Changes to the Contract Owner, Annuitant and/or Beneficiary designations and changes in marital status, including a dissolution of marriage, may adversely affect the benefits of this Rider. A particular change may make a Designated Life ineligible to receive lifetime income benefits under this Rider. As a result, the Rider may remain in effect and you may pay for benefits that you will not receive. You are strongly advised to work with your financial professional and consider your options prior to making any Owner, Annuitant and/or Beneficiary changes to your Contract. See Rider Terms – Designated Lives above and ADDITIONAL INFORMATION – Changes to Your Contract in the Prospectus.
Termination
You cannot request a termination of the Rider. Except as otherwise provided below, the Rider will automatically terminate on the earliest of:
· the date of the death of all Designated Lives eligible for lifetime benefits,
· upon the death of the first Designated Life, if a death benefit is payable and a Surviving Spouse who chooses to continue the Contract is not a Designated Life eligible for lifetime benefits,
· upon the death of the first Designated Life, if a death benefit is payable and the Contract is not continued by a Surviving Spouse who is a Designated Life eligible for lifetime benefits,
· if both Designated Lives are Joint Owners and there is a change in marital status, the Rider will terminate upon the death of the first Designated Life who is a Contract Owner,
· the day the Contract is terminated in accordance with the provisions of the Contract,
· the day that we are notified of an ownership change and neither Designated Life is an Owner (or Annuitant, in the case of a custodial owned IRA) (this bullet does not apply if this Rider is issued in California),
· in California, if neither Designated Life is an Owner (or Annuitant in the case of a custodial owned IRA), upon the earlier of the death of the first Designated Life or when a death benefit becomes payable under the Contract,
· the Annuity Date (see the Annuitization subsection for additional information),
· the day the Contract Value is reduced to zero (0) as a result of an Excess Withdrawal (see Rider Terms), or
· the day the Contract Value is reduced to zero (0) (such as through withdrawals, fees, or market performance) if the youngest Designated Life is younger than age 59½.
See the Depletion of Contract Value subsection for situations where the Rider will not terminate when the Contract Value is reduced to zero.
Sample Calculations
Hypothetical sample calculations are in the attached FUTURE INCOME GENERATOR (SINGLE & JOINT) SAMPLE CALCULATIONS APPENDIX The examples are based on certain hypothetical assumptions and are for example purposes only. These examples are not intended to serve as projections of future investment returns.
Enhanced Income Select 2 (Single)
(This Rider is called the Guaranteed Withdrawal Benefit XXIII Rider – Single Life in the Contract’s Rider.)
Purchasing the Rider
Prior to purchase, you must obtain our approval if your initial Protected Payment Base is $1,000,000 or greater.
You may purchase this Rider only on the Contract Date provided that on the Rider Effective Date:
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· the Designated Life is 85 years of age or younger, and
· the Owner and Annuitant is the same person (except for Non-Natural Owners),
· the Contract is not issued as an Inherited IRA, Inherited Roth IRA, Inherited TSA or Non-Qualified Life Expectancy (Stretch), and
· you allocate your entire Contract Value according to the Investment Allocation Requirements.
Joint Owners may not purchase this Rider.
Rider Terms
Annual Credit – An amount added to the Protected Payment Base. The Annual Credit Percentage is disclosed in the Rate Sheet Prospectus Supplement applicable to your Contract.
Annual RMD Amount – The amount required to be distributed each Calendar Year for purposes of satisfying the minimum distribution requirements of Code Section 401(a)(9) (“Section 401(a)(9)”) and related Treasury Regulations.
Designated Life – The person upon whose life the benefits of this Rider are based. The Owner/Annuitant (or youngest Annuitant in the case of a Non-Natural Owner) will be the Designated Life. The Designated Life cannot be changed.
Early Withdrawal – Any withdrawal that occurs before the Designated Life is 59½ years of age.
Enhanced Income Amount – When the Contract Value is greater than zero (0), this is the maximum amount that can be withdrawn in a Contract Year under this Rider without reducing the Protected Payment Base. The initial Enhanced Income Amount will depend on the age of the Designated Life. If the Designated Life is younger than 59½ years of age, the Enhanced Income Amount is equal to zero (0); however, once the Designated Life reaches age 59½, the Enhanced Income Amount will be determined using the age at the time of the first withdrawal or the first withdrawal after an Automatic or Owner-Elected Reset, and is equal to the Enhanced Income Percentage multiplied by the Protected Payment Base, less withdrawals made during the current Contract Year. This amount will never be less than zero (0). Any allowable Enhanced Income Amount not withdrawn during a Contract Year can be withdrawn the following Contract Year. This amount is referred to as the Income Rollover Amount as defined further below.
Enhanced Income Percentage – When the Contract Value is greater than zero (0), this percentage is used to determine the Enhanced Income Amount. The applicable Enhanced Income Percentage is based on the age of the Designated Life at the time of the first withdrawal, or the first withdrawal after an Automatic Reset or Owner-Elected Reset occurs. The Enhanced Income Percentages table is disclosed in the Rate Sheet Prospectus Supplement applicable to your Contract.
Excess Withdrawal – Any withdrawal (except an RMD Withdrawal) that occurs after the Designated Life is age 59½ or older and exceeds the Enhanced Income Amount plus any Income Rollover Amount.
Guaranteed Lifetime Income Amount – Once the Contract Value is reduced to zero (0) by a withdrawal that did not exceed the Enhanced Income Amount plus any Income Rollover Amount (except an RMD Withdrawal), this is the amount that will be paid each Contract Year. See Depletion of Contract Value subsection. The Guaranteed Lifetime Income Amount is equal to the Guaranteed Lifetime Income Percentage multiplied by the Protected Payment Base at the time the Contract Value is reduced to zero (0). This amount will never be less than zero (0).
Guaranteed Lifetime Income Percentage – Once the Contract Value is reduced to zero (0), the Guaranteed Lifetime Income Percentage is used to determine the Guaranteed Lifetime Income Amount. The Guaranteed Lifetime Income Percentage is disclosed in the Rate Sheet Prospectus Supplement applicable to your Contract.
Income Rollover Amount – Any unused Enhanced Income Amount from the prior Contract Year that is available for withdrawal without reducing the Protected Payment Base. The Income Rollover Amount will not be carried over more than one Contract Year and is not cumulative. This amount is not adjusted for any subsequent Purchase Payments or resets (Automatic or Owner-Elected). The Income Rollover Amount is only available the year after the Designated Life reaches age 59½ and a withdrawal is taken. The Income Rollover Amount will not apply in a Contract Year if the Income Rollover Amount is greater than the Contract Value on any Contract Anniversary.
Protected Payment Base – An amount used to determine the Enhanced Income Amount and the Guaranteed Lifetime Income Amount. The Protected Payment Base will remain unchanged except as otherwise described under the provisions of this Rider. The initial Protected Payment Base is equal to the initial Purchase Payment. See Example 1 in the ENHANCED INCOME SELECT 2 (SINGLE & JOINT) SAMPLE CALCULATIONS APPENDIX for a numerical example of initial values. The Protected Payment Base will never be less than zero (0).
Reset Date – Any Contract Anniversary after the Rider Effective Date on which an Automatic Reset or Owner-Elected Reset occurs.
Rider Effective Date – The date the guarantees and charges for the Rider become effective; the Contract Date.
Annual Credit
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On each Contract Anniversary after the Rider Effective Date, an Annual Credit will be applied to the Protected Payment Base until the earlier of:
· the first withdrawal since the Rider Effective Date, or
· 10 Contract Anniversaries from the Rider Effective Date.
Prior to an Automatic or Owner-Elected Reset, the Annual Credit amount is equal to the Annual Credit Percentage multiplied by the total Purchase Payments received. Once an Automatic or Owner-Elected Reset takes place, the Annual Credit amount is equal to the reset Protected Payment Base plus any subsequent Purchase Payments multiplied by the Annual Credit Percentage. See Example 2 in the ENHANCED INCOME SELECT 2 (SINGLE & JOINT) APPENDIX for a numerical example of the Annual Credit calculation. Once a withdrawal (including an RMD withdrawal) or 10 Contract Anniversaries has occurred, as measured from the Rider Effective Date, no Annual Credit will be added to the Protected Payment Base. In addition, Annual Credit eligibility cannot be reinstated/restarted by any Automatic or Owner-Elected Reset. Any Annual Credit added during any Contract Year before Annual Credit eligibility is lost will continue to be counted in the Protected Payment Base. The Annual Credit Percentage is disclosed in the Rate Sheet Prospectus Supplement applicable to your Contract.
You will find information about an RMD Withdrawal in the Required Minimum Distributions subsection and information about Automatic Resets and Owner-Elected Resets in the Reset of Protected Payment Base subsection below.
How the Rider Works
Beginning at age 59½, this Rider guarantees you can withdraw up to the Enhanced Income Amount plus any Income Rollover Amount, regardless of market performance, until the Contract Value equals zero (0). This Rider provides for an amount (an “Annual Credit”) to be added to the Protected Payment Base. The Rider provides for Automatic Resets of the Protected Payment Base to an amount equal to 100% of the Contract Value (if the Protected Payment Base is at least $1.00 less than the Contract Value on that Contract Anniversary). If there is an Annual Credit amount applied, it is added to the Protected Payment Base before any reset determination is made. Once the Contract Value equals zero (0) through a withdrawal that did not exceed the Enhanced Income Amount plus any Income Rollover Amount (except an RMD Withdrawal), you will receive the Guaranteed Lifetime Income Amount until the death of the Designated Life or when a death benefit becomes payable under the Contract. See Depletion of Contract Value below. Once the Rider is purchased, you cannot request a termination of the Rider (see the Termination subsection of this Rider for more information).
If applicable, an Annual Credit is added to the Protected Payment Base prior to any Automatic Reset. If the Contract Value as of that Contract Anniversary is greater than the Protected Payment Base (which includes the Annual Credit Amount), then the Protected Payment Base will be automatically reset to equal the Contract Value.
If the Designated Life is 59½ years of age or older, the Enhanced Income Amount is the applicable Enhanced Income Percentage (as disclosed in the Rate Sheet Prospectus Supplement applicable to your Contract) multiplied by the Protected Payment Base less any withdrawals made during the current Contract Year. If the Designated Life is younger than 59½ years of age, the Enhanced Income Amount is zero (0). The Enhanced Income Percentage that will apply will be based on the Designated Life’s age at the time of the first withdrawal or the first withdrawal after an Automatic or Owner-Elected Reset occurs. (See Examples 7 and 8 in the ENHANCED INCOME SELECT 2 (SINGLE & JOINT) APPENDIX for a numerical example of how a different Enhanced Income Percentage may be reached through a reset).
The Protected Payment Base may change over time. The Protected Payment Base can be changed by subsequent Purchase Payments, the Annual Credit, Automatic or Owner-Elected Resets or by certain withdrawals. Here are ways the Protected Payment Base may change:
· The Protected Payment Base is increased by the full amount of any subsequent Purchase Payments made during the Contract Year.
· For the first 10 years from the Rider Effective Date, the Protected Payment Base will be increased by the Annual Credit amount, as long as no withdrawals are made. If you take any type of withdrawal within the first 10 years from the Rider Effective Date, the Annual Credit will no longer affect the Protected Payment Base. Any Annual Credit added during the Contract Years before the withdrawal will remain in the Protected Payment Base.
· An Automatic Reset (if the Protected Payment Base plus any applicable Annual Credit is at least $1.00 less than the Contract Value on that Contract Anniversary) will increase the Protected Payment Base. An Owner-Elected Reset will increase or decrease the Protected Payment Base depending on the Contract Value on the Reset Date. See Reset of Protected Payment Base subsection.
· A withdrawal that is less than or equal to the amount allowed each Contract Year (the Enhanced Income Amount plus any Income Rollover Amount) will not change the Protected Payment Base. However, if a withdrawal is greater than the Enhanced Income Amount plus any applicable Income Rollover Amount and the Contract Value (less the Enhanced Income Amount and any Income Rollover Amount) is lower than the Protected Payment Base at the time of withdrawal, the Protected Payment Base will be reduced by an amount that is greater than the excess amount withdrawn. For withdrawals that are greater than the
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Enhanced Income Amount plus any applicable Income Rollover Amount, see the Withdrawal of Enhanced Income Amount subsection. See Examples 3 and 4 of the ENHANCED INCOME SELECT 2 (SINGLE & JOINT) APPENDIX for numerical examples of withdrawals and the effect on the Protected Payment Base.
The Protected Payment Base cannot be withdrawn as a lump sum, is not payable as a death benefit, and is not used in calculating any annuity option available under the Contract before the maximum Annuity Date. See Annuitization subsection.
For purposes of this Rider, the term "withdrawal" includes any applicable withdrawal charges and taxes (there is no charge for the maximum annual withdrawal amount allowed under the rider).Amounts withdrawn under this Rider will reduce the Contract Value by the amount withdrawn and will be subject to the same conditions, limitations, restrictions and all other fees, charges and deductions, if applicable, as withdrawals otherwise made under the provisions of the Contract. If the withdrawal is requested on a net basis, the Contract Owner must account for any charges and taxes to ensure that the gross withdrawal amount does not exceed the Enhanced Income Amount plus any applicable Income Rollover Amount. Unless you specify otherwise, a partial withdrawal amount requested will be processed as a gross amount. Withdrawals under this Rider are not annuity payouts. Annuity payouts generally receive a more favorable tax treatment than other withdrawals.
If your Contract is a Qualified Contract, including an IRA Contract, you are subject to restrictions on withdrawals you may take prior to a triggering event (e.g. reaching age 59½, separation from service, disability) and you should consult your tax or legal advisor prior to purchasing this Contract and rider, the primary benefit of which is guaranteeing withdrawals. For additional information regarding withdrawals and triggering events, see FEDERAL TAX ISSUES – IRAs and Qualified Plans.
Withdrawal of Enhanced Income Amount
When the Designated Life is 59½ years of age or older, you may withdraw up to the Enhanced Income Amount plus any Income Rollover Amount each Contract Year, until the Contract Value is zero (0). The Enhanced Income Amount will be reduced by the amount withdrawn during the Contract Year, inclusive of any applicable charges and taxes, and will be reset each Contract Anniversary. Any portion of the Enhanced Income Amount not withdrawn during a Contract Year (the “Income Rollover Amount”) may be carried over to the next Contract Year and is available for withdrawal during that Contract Year only. Income Rollover Amounts are not cumulative. If a withdrawal does not exceed the Enhanced Income Amount plus any Income Rollover Amount immediately prior to that withdrawal, the Protected Payment Base will remain unchanged.
Withdrawals during a Contract Year will first be taken from any available Income Rollover Amount then from the current year’s Enhanced Income Amount. Any Income Rollover Amount is not adjusted by subsequent Purchase Payments.
Withdrawals Exceeding the Enhanced Income Amount. If a withdrawal (except an RMD Withdrawal) exceeds the Enhanced Income Amount plus any Income Rollover Amount immediately prior to that withdrawal, we will (immediately following the withdrawal) reduce the Protected Payment Base on a proportionate basis for the amount in excess of the Enhanced Income Amount plus any Income Rollover Amount. Withdrawals that exceed the Enhanced Income Amount plus any Income Rollover Amount may have the effect of reducing future benefits by more than the dollar amount of the withdrawal. (See Example 4 in the ENHANCED INCOME SELECT 2 (SINGLE & JOINT) APPENDIX for a numerical example of the adjustments to the Protected Payment Base as a result of an Excess Withdrawal.) If a withdrawal is greater than the Enhanced Income Amount plus any Income Rollover Amount and the Contract Value (less the Enhanced Income Amount and any Income Rollover Amount) is lower than the Protected Payment Base, the Protected Payment Base will be reduced by an amount that is greater than the excess amount withdrawn.
The amount available for withdrawal under the Contract must be sufficient to support any withdrawal that would otherwise exceed the Enhanced Income Amount plus any Income Rollover Amount or your Rider will terminate (see the Depletion of Contract Value subsection below).
For information regarding taxation of withdrawals, see FEDERAL TAX ISSUES.
Early Withdrawal
If an Early Withdrawal occurs, we will (immediately following the Early Withdrawal) reduce the Protected Payment Base either on a proportionate basis or by the total withdrawal amount, whichever results in a lower Protected Payment Base. Early Withdrawals may have the effect of reducing future benefits by more than the dollar amount of the withdrawal. See Example 5 in the ENHANCED INCOME SELECT 2 (SINGLE & JOINT) APPENDIX for a numerical example of the adjustments to the Protected Payment Base as a result of an Early Withdrawal.
Required Minimum Distributions
No adjustment will be made to the Protected Payment Base as a result of a withdrawal that exceeds the Enhanced Income Amount plus any Income Rollover Amount immediately prior to the withdrawal, provided:
· such withdrawal (an “RMD Withdrawal”) is for purposes of satisfying the minimum distribution requirements of Section 401(a)(9) and related Treasury Regulations,
· you have authorized us to calculate and make periodic distribution of the Annual RMD Amount for the Calendar Year required based on the payment frequency you have chosen,
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· the Annual RMD Amount is based on the previous year-end fair market value of this Contract only, and
· only RMD withdrawals are made from the Contract during the Contract Year.
Once a withdrawal occurs, including an RMD Withdrawal, no Annual Credit will be added to the Protected Payment Base. In addition, Annual Credit eligibility cannot be reinstated or restarted by any Automatic or Owner Elected Reset. Any Annual Credit added during any Contract Year before Annual Credit eligibility is lost will continue to be counted in the Protected Payment Base.
We reserve the right to modify or eliminate the treatment of RMD Withdrawals under this Rider if there is any change to the Internal Revenue Code or Treasury Regulations relating to required minimum distributions, including the issuance of relevant IRS guidance. If we exercise this right, we will provide 30 days advance notice to the Owner.
See Example 6 in ENHANCED INCOME SELECT 2 (SINGLE & JOINT) APPENDIX for numerical examples that describe what occurs when only withdrawals of the Annual RMD Amount are made during a Contract Year and when withdrawals of the Annual RMD Amount plus other non-RMD Withdrawals are made during a Contract Year.
See FEDERAL TAX ISSUES – Qualified Contracts – Required Minimum Distributions.
Depletion of Contract Value
If the Designated Life is younger than age 59½ when the Contract Value is zero (0) (such as through withdrawals, fees, or market performance), the Rider will terminate.
If the Designated Life is age 59½ or older and the Contract Value was reduced to zero (0) by a withdrawal that exceeds the Enhanced Income Amount plus any Income Rollover Amount (excluding an RMD Withdrawal), the Rider will terminate and you will not receive payments of the Guaranteed Lifetime Income Amount.
If the Designated Life is age 59½ or older and the Contract Value was reduced to zero (0) by a withdrawal that did not exceed the Enhanced Income Amount plus any Income Rollover Amount, (except that an RMD Withdrawal may exceed the Enhanced Income Amount plus any Income Rollover Amount), the following will apply:
· the remaining Enhanced Income Amount will be paid automatically for that Contract Year. The Income Rollover Amount will no longer apply going forward. Starting on the next Contract Anniversary, the Guaranteed Lifetime Income Amount will be paid each year until the date of death of the Designated Life,
· the Guaranteed Lifetime Income Amount will be paid under a series of pre-authorized withdrawals under a payment frequency as elected by the Owner, but no less frequently than annually, until the date of death of the Designated Life,
· no additional Purchase Payments will be accepted under the Contract, and
· the Contract will cease to provide any death benefit (amount will be zero (0)).
The Guaranteed Lifetime Income Amount will be calculated by multiplying the Protected Payment Base, at the time the Contract Value equals zero (0), by the Guaranteed Lifetime Income Percentage.
Reset of Protected Payment Base
Regardless of which reset option is used, on and after each Reset Date, the provisions of this Rider shall apply in the same manner as they applied when the Rider was originally issued, except that an Automatic Reset or an Owner-Elected Reset will not reinstate eligibility for the Annual Credit as described above. The limitations and restrictions on Purchase Payments and withdrawals, the deduction of Rider charges and any future reset options available on and after the Reset Date, will again apply and will be measured from that Reset Date. A reset occurs when the Protected Payment Base is changed to an amount equal to the Contract Value as of the Reset Date.
Automatic Reset. On each Contract Anniversary while this Rider is in effect and before the Annuity Date, we will automatically reset the Protected Payment Base to an amount equal to 100% of the Contract Value, if the Protected Payment Base, after any Annual Credits are applied, is at least $1.00 less than the Contract Value on that Contract Anniversary. See Example 7 in the ENHANCED INCOME SELECT 2 (SINGLE & JOINT) SAMPLE CALCULATIONS APPENDIX for a numerical example of an Automatic Reset.
Owner-Elected Resets (Non-Automatic). You may, on any Contract Anniversary, elect to reset the Protected Payment Base to an amount equal to 100% of the Contract Value. An Owner-Elected Reset may be elected while Automatic Resets are in effect.
If you elect this option, your election must be received, In Proper Form, within sixty (60) calendar days after the Contract Anniversary on which the reset is effective. The reset will be based on the Contract Value as of that Contract Anniversary. Your election of this option may result in a reduction in the Protected Payment Base and Enhanced Income Amount. Generally, the reduction will occur when your Contract Value is less than the Protected Payment Base as of the Contract Anniversary you elected the reset. There may be situations where you may want to elect an Owner-Elected Reset. For example, one scenario where an Owner-Elected Reset may be used is when no Automatic Resets have occurred and the Designated Life has reached a higher age band (e.g. was 64 years of age and turned 65). The attainment of a higher age band may provide for a higher Enhanced Income Percentage which could provide a higher annual withdrawal amount. See Example 8 in the ENHANCED INCOME SELECT 2 (SINGLE & JOINT) SAMPLE
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CALCULATIONS APPENDIX for a numerical example how an Owner-Elected Reset may be used in this situation. You are strongly advised to work with your financial professional prior to electing an Owner-Elected Reset. We will provide you with written confirmation of your election.
Subsequent Purchase Payments
If we accept additional Purchase Payments after the Rider Effective Date, we will increase the Protected Payment Base by the amount of the Purchase Payments. See Example 2 in the ENHANCED INCOME SELECT 2 (SINGLE & JOINT) SAMPLE CALCULATIONS APPENDIX for a numerical example of adjustments to the Protected Payment Base when an additional Purchase Payment is made. We reserve the right to reject or restrict, at our discretion, any additional Purchase Payments. If we exercise our right to reject or restrict any future Purchase Payments, we will provide 30 days advance notice to the Owner.If we decide to no longer accept Purchase Payments, we will not accept subsequent Purchase Payments for your Contract and any limitations will be applied uniformly to all Contract Owners.
Annuitization
If you annuitize the Contract at the maximum Annuity Date specified in your Contract, this Rider is still in effect at the time of your election, and a Life Only fixed annuity option is chosen, the annuity payments will be equal to the greater of:
· the Life Only fixed annual payment amount based on the terms of your Contract, or
· the Guaranteed Lifetime Income Amount in effect at the maximum Annuity Date.
The Guaranteed Lifetime Income Amount will be less than the amount you may have received under the Enhanced Income Amount prior to annuitizing your Contract.
If you annuitize the Contract at any time prior to the maximum Annuity Date specified in your Contract, your annuity payments will be determined in accordance with the terms of your Contract. The Protected Payment Base, Enhanced Income Amount, and Guaranteed Lifetime Income Amount under this Rider will not be used in determining any annuity payments and your annuity payments received may be less than the Enhanced Income Amount or Guaranteed Lifetime Income Amount you are entitled to receive under the Rider. Work with your financial professional to determine if you should annuitize your Contract before the maximum Annuity Date or stay in the accumulation phase and continue to take withdrawals under the Rider.
Continuation of Rider if Surviving Spouse Continues Contract
This Rider terminates upon the death of the Designated Life or when a death benefit becomes payable under the Contract, whichever occurs first. If the surviving spouse continues the Contract, the surviving spouse may not re-purchase this Rider, any payments under the Rider will cease, and the Rider will terminate.
The surviving spouse may elect to receive any death benefit proceeds instead of continuing the Contract (see DEATH BENEFITS AND OPTIONAL DEATH BENEFIT RIDERS - Death Benefits).
Termination
You cannot request a termination of the Rider. Except as otherwise provided below, the Rider will automatically terminate on the earliest of:
· the date of the death of the Designated Life or when a death benefit becomes payable under the Contract,
· the day the Contract is terminated in accordance with the provisions of the Contract,
· the day we are notified of an ownership change of a Non-Qualified Contract (excluding ownership changes: to or from certain trusts, adding or removing the Owner’s spouse, or for Riders issued in California),
· the Annuity Date (see the Annuitization subsection for additional information),
· the day the Contract Value is reduced to zero (0) as a result of an Excess Withdrawal (see Rider Terms), or
· the day the Contract Value is reduced to zero (0) (such as through withdrawals, fees, or market performance) if the Designated Life is younger than age 59½.
See the Depletion of Contract Value subsection for situations where the Rider will not terminate when the Contract Value is reduced to zero (0).
Sample Calculations
Hypothetical sample calculations are in the attached ENHANCED INCOME SELECT 2 (SINGLE & JOINT) APPENDIX. The examples are based on certain hypothetical assumptions and are for example purposes only. These examples are not intended to serve as projections of future investment returns.
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Enhanced Income Select 2 (Joint)
(This Rider is called the Guaranteed Withdrawal Benefit XXIII Rider– Joint Life in the Contract’s Rider.)
Purchasing the Rider
Prior to purchase, you must obtain our approval if your initial Protected Payment Base is $1,000,000 or greater.
You may purchase this Rider only on the Contract Date if you meet the following eligibility requirements:
· the Contract is issued as:
· Non-Qualified Contract (this Rider is not available if this is a post-death Non-Qualified Contract, the Owner is a trust or other entity), or
· Qualified Contract under Code Section 408(a), 408(k), 408A, 408(p), except for Inherited IRAs, Inherited Roth IRAs, or Inherited TSAs, 401(a), 401(k), Individual(k), Keogh, or 457 plan.
· both Designated Lives are 85 years or younger,
· the Contract must be structured so that upon the death of one Designated Life, the surviving Designated Life may retain or assume ownership of the Contract, and
· any Owner/Annuitant is a Designated Life (except for custodial owned IRA Contracts).
For purposes of meeting the eligibility requirements, Designated Lives must be any one of the following:
· a sole Owner with the Owner’s Spouse designated as the sole primary Beneficiary,
· Joint Owners, where the Owners are each other’s Spouses, or
· if the Contract is issued as a custodial owned IRA, the beneficial owner must be the Annuitant and the Annuitant’s Spouse must be designated as the sole primary Beneficiary under the Contract. The custodian, under a custodial owned IRA, for the benefit of the beneficial owner, may be designated as sole primary Beneficiary provided that the Spouse of the beneficial owner is the sole primary Beneficiary of the custodial account.
Naming your Spouse as the Beneficiary to meet eligibility requirements will not be considered a change of Annuitant on the Contract.
Rider Terms
Annual Credit – An amount added to the Protected Payment Base. The Annual Credit Percentage is disclosed in the Rate Sheet Prospectus Supplement applicable to your Contract.
Annual RMD Amount – The amount required to be distributed each Calendar Year for purposes of satisfying the minimum distribution requirements of Code Section 401(a)(9) (“Section 401(a)(9)”) and related Treasury Regulations.
Designated Lives (each a “Designated Life”) – Designated Lives must be natural persons who are each other’s spouses on the Rider Effective Date. Designated Lives will remain unchanged while this Rider is in effect.
To be eligible for lifetime benefits, the Designated Life must:
· be the Owner (or Annuitant, in the case of a custodial owned IRA), or
· remain the Spouse of the other Designated Life and be the first in line of succession, as determined under the Contract, for payment of any death benefit.
Early Withdrawal – Any withdrawal that occurs before the youngest Designated Life is 59½ years of age.
Enhanced Income Amount – When the Contract Value is greater than zero (0), this is the maximum amount that can be withdrawn in a Contract Year under this Rider without reducing the Protected Payment Base. The initial Enhanced Income Amount will depend on the age of the youngest Designated Life. If the youngest Designated Life is younger than 59½ years of age, the Enhanced Income Amount is equal to zero (0); however, once the youngest Designated Life reaches age 59½, the Enhanced Income Amount will be determined using the age at the time of the first withdrawal or the first withdrawal after an Automatic or Owner-Elected Reset, and is equal to the Enhanced Income Percentage multiplied by the Protected Payment Base, less withdrawals made during the current Contract Year. This amount will never be less than zero (0). Any allowable Enhanced Income Amount not withdrawn during a Contract Year can be withdrawn the following Contract Year. This amount is referred to as the Income Rollover Amount as defined further below.
Enhanced Income Percentage - When the Contract Value is greater than zero (0), this percentage is used to determine the Enhanced Income Amount. The applicable Enhanced Income Percentage is based on the age of the youngest Designated Life at the time of the first withdrawal, or the first withdrawal after an Automatic Reset or Owner-Elected Reset occurs. The Enhanced Income Percentages table is disclosed in the Rate Sheet Prospectus Supplement applicable to your Contract.
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Excess Withdrawal – Any withdrawal (except an RMD Withdrawal) that occurs after the youngest Designated Life is age 59½ or older and exceeds the Enhanced Income Amount plus any Income Rollover Amount.
Guaranteed Lifetime Income Amount – Once the Contract Value is reduced to zero (0) by a withdrawal that did not exceed the Enhanced Income Amount plus any Income Rollover Amount (except an RMD Withdrawal), this is the amount that will be paid each Contract Year. See Depletion of Contract Value below. The Guaranteed Lifetime Income Amount is equal to the Guaranteed Lifetime Income Percentage multiplied by the Protected Payment Base at the time the Contract Value is reduced to zero (0). This amount will never be less than zero (0).
Guaranteed Lifetime Income Percentage – Once the Contract Value is reduced to zero (0), the Guaranteed Lifetime Income Percentage is used to determine the Guaranteed Lifetime Income Amount. The Guaranteed Lifetime Income Percentage is disclosed in the Rate Sheet Prospectus Supplement applicable to your Contract.
Income Rollover Amount – Any unused Enhanced Income Amount from the prior Contract Year that is available for withdrawal without reducing the Protected Payment Base. The Income Rollover Amount will not be carried over more than one Contract Year and is not cumulative. This amount is not adjusted for any subsequent Purchase Payments or resets (Automatic or Owner-Elected). The Income Rollover Amount is only available the year after the youngest Designated Life reaches age 59½ and a withdrawal is taken. The Income Rollover Amount will not apply in a Contract Year if the Income Rollover Amount is greater than the Contract Value on any Contract Anniversary.
Protected Payment Base – An amount used to determine the Enhanced Income Amount and the Guaranteed Lifetime Income Amount. The Protected Payment Base will remain unchanged except as otherwise described under the provisions of this Rider. The initial Protected Payment Base is equal to the initial Purchase Payment. See Example 1 in the ENHANCED INCOME SELECT 2 (SINGLE & JOINT) SAMPLE CALCULATIONS APPENDIX for a numerical example of initial values. The Protected Payment Base will never be less than zero (0).
Reset Date – Any Contract Anniversary after the Rider Effective Date on which an Automatic Reset or Owner-Elected Reset occurs.
Rider Effective Date – The date the guarantees and charges for the Rider become effective; the Contract Date.
Spouse – The Owner’s spouse who is treated as the Owner’s spouse pursuant to federal law. If the Contract is a custodial owned IRA, the Annuitant’s spouse who is treated as the Annuitant’s spouse pursuant to federal law.
Surviving Spouse – The surviving spouse of a deceased Owner (or Annuitant in the case of a custodial owned IRA).
Annual Credit
On each Contract Anniversary after the Rider Effective Date, an Annual Credit will be applied to the Protected Payment Base until the earlier of:
· the first withdrawal since the Rider Effective Date, or
· 10 Contract Anniversaries from the Rider Effective Date.
Prior to an Automatic or Owner-Elected Reset, the Annual Credit amount is equal to the Annual Credit Percentage multiplied by the total Purchase Payments received. Once an Automatic or Owner-Elected Reset takes place, the Annual Credit amount is equal to the reset Protected Payment Base plus any subsequent Purchase Payments multiplied by the Annual Credit Percentage. See Example 2 in the ENHANCED INCOME SELECT 2 (SINGLE & JOINT) APPENDIX for a numerical example of the Annual Credit calculation. Once a withdrawal (including an RMD withdrawal) or 10 Contract Anniversaries has occurred, as measured from the Rider Effective Date, no Annual Credit will be added to the Protected Payment Base. In addition, Annual Credit eligibility cannot be reinstated/restarted by any Automatic or Owner-Elected Reset. Any Annual Credit added during any Contract Year before Annual Credit eligibility is lost will continue to be counted in the Protected Payment Base. The Annual Credit Percentage is disclosed in the Rate Sheet Prospectus Supplement applicable to your Contract.
You will find information about an RMD Withdrawal in the Required Minimum Distributions subsection and information about Automatic Resets and Owner-Elected Resets in the Reset of Protected Payment Base subsection below.
How the Rider Works
Beginning at age 59½, this Rider guarantees you can withdraw up to the Enhanced Income Amount plus any Income Rollover Amount, regardless of market performance, until the Contract Value equals zero (0). This Rider provides for an amount (an “Annual Credit”) to be added to the Protected Payment Base. The Rider provides for Automatic Resets of the Protected Payment Base to an amount equal to 100% of the Contract Value (if the Protected Payment Base is at least $1.00 less than the Contract Value on that Contract Anniversary). If there is an Annual Credit Amount applied, it is added to the Protected Payment Base before any reset determination is made. Once the Contract Value equals zero (0) through a withdrawal that did not exceed the Enhanced Income Amount plus any Income Rollover Amount (except an RMD Withdrawal), you will receive the Guaranteed Lifetime Income Amount until the death of all Designated Lives eligible for lifetime benefits. See Depletion of Contract Value below. Once the Rider is purchased, you cannot request a termination of the Rider (see the Termination subsection of this Rider for more information).
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If applicable, an Annual Credit is added to the Protected Payment Base prior to any Automatic Reset. If the Contract Value as of that Contract Anniversary is at least $1.00 greater than the Protected Payment Base (which includes the Annual Credit amount), then the Protected Payment Base will be automatically reset to equal the Contract Value.
If the youngest Designated Life is 59½ years of age or older, the Enhanced Income Amount is the applicable Enhanced Income Percentage (as disclosed in the Rate Sheet Prospectus Supplement applicable to your Contract) multiplied by the Protected Payment Base less any withdrawals made during the current Contract Year. If the youngest Designated Life is younger than 59½ years of age, the Enhanced Income Amount is zero (0). The Enhanced Income Percentage that will apply will be based on the youngest Designated Life’s age at the time of the first withdrawal or the first withdrawal after an Automatic or Owner-Elected Reset occurs. (See Examples 7 and 8 in the ENHANCED INCOME SELECT 2 (SINGLE & JOINT) APPENDIX for a numerical example of how a different Enhanced Income Percentage may be reached through a reset).
The Protected Payment Base may change over time. The Protected Payment Base can be changed by subsequent Purchase Payments, the Annual Credit, Automatic or Owner-Elected Resets or by certain withdrawals. Here are ways the Protected Payment Base may change:
· The Protected Payment Base is increased by the full amount of any subsequent Purchase Payments made during the Contract Year.
· For the first 10 years from the Rider Effective Date, the Protected Payment Base will be increased by the Annual Credit amount, as long as no withdrawals are made. If you take any type of withdrawal within the first 10 years from the Rider Effective Date, the Annual Credit will no longer affect the Protected Payment Base. Any Annual Credit added during the Contract Years before the withdrawal will remain in the Protected Payment Base.
· An Automatic Reset (if the Protected Payment Base plus any applicable Annual Credit is at least $1.00 less than the Contract Value on that Contract Anniversary) will increase the Protected Payment Base. An Owner-Elected Reset will increase or decrease the Protected Payment Base depending on the Contract Value on the Reset Date. See the Reset of Protected Payment Base subsection.
· A withdrawal that is less than or equal to the amount allowed each Contract Year (the Enhanced Income Amount plus any Income Rollover Amount) will not change the Protected Payment Base. However, if a withdrawal is greater than the Enhanced Income Amount plus any Income Rollover Amount and the Contract Value (less the Enhanced Income Amount and any Income Rollover Amount) is lower than the Protected Payment Base at the time of withdrawal, the Protected Payment Base will be reduced by an amount that is greater than the excess amount withdrawn. For withdrawals that are greater than the Enhanced Income Amount plus any applicable Income Rollover Amount, see the Withdrawal of Enhanced Income Amount subsection. See Examples 3 and 4 of the ENHANCED INCOME SELECT 2 (SINGLE & JOINT) APPENDIX for numerical examples of withdrawals and the effect on the Protected Payment Base.
The Protected Payment Base cannot be withdrawn as a lump sum, is not payable as a death benefit, and is not used in calculating any annuity option available under the Contract before the maximum Annuity Date. See the Annuitization subsection below.
For purposes of this Rider, the term "withdrawal" includes any applicable withdrawal charges and taxes (there is no charge for the maximum annual withdrawal amount allowed under the rider).Amounts withdrawn under this Rider will reduce the Contract Value by the amount withdrawn and will be subject to the same conditions, limitations, restrictions and all other fees, charges and deductions, if applicable, as withdrawals otherwise made under the provisions of the Contract. If the withdrawal amount is requested on a net basis, the Contract Owner must account for any charges and taxes to ensure that the gross withdrawal amount does not exceed the Enhanced Income Amount plus any applicable Income Rollover Amount. Unless you specify otherwise, a partial withdrawal amount requested will be processed as a gross amount. Withdrawals under this Rider are not annuity payouts. Annuity payouts generally receive a more favorable tax treatment than other withdrawals.
If your Contract is a Qualified Contract, including an IRA Contract, you are subject to restrictions on withdrawals you may take prior to a triggering event (e.g. reaching age 59½, separation from service, or disability) and you should consult your tax or legal advisor prior to purchasing this Contract and rider, the primary benefit of which is guaranteeing withdrawals. For additional information regarding withdrawals and triggering events, see FEDERAL TAX ISSUES – IRAs and Qualified Plans.
Withdrawal of Enhanced Income Amount
When the youngest Designated Life is 59½ years of age or older, you may withdraw up to the Enhanced Income Amount plus any Income Rollover Amount each Contract Year, until the Contract Value is zero (0). The Enhanced Income Amount will be reduced by the amount withdrawn during the Contract Year, inclusive of any applicable charges and taxes, and will be reset each Contract Anniversary. Any portion of the Enhanced Income Amount not withdrawn during a Contract Year (the “Income Rollover Amount”) may be carried over to the next Contract Year and is available for withdrawal during that Contract Year only. Income Rollover Amounts are not cumulative. If a withdrawal does not exceed the Enhanced Income Amount plus any Income Rollover Amount immediately prior to that withdrawal, the Protected Payment Base will remain unchanged.
Withdrawals during a Contract Year will first be taken from any available Income Rollover Amount then from the current year’s Enhanced Income Amount. Any Income Rollover Amount is not adjusted by subsequent Purchase Payments.
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Withdrawals Exceeding the Enhanced Income Amount. If a withdrawal (except an RMD Withdrawal) exceeds the Enhanced Income Amount plus any Income Rollover Amount immediately prior to that withdrawal, we will (immediately following the withdrawal) reduce the Protected Payment Base on a proportionate basis for the amount in excess of the Enhanced Income Amount plus any Income Rollover Amount. Withdrawals that exceed the Enhanced Income Amount plus any Income Rollover Amount may have the effect of reducing future benefits by more than the dollar amount of the withdrawal. (See Example 4 in the ENHANCED INCOME SELECT 2 (SINGLE & JOINT) APPENDIX for a numerical example of the adjustments to the Protected Payment Base as a result of an Excess Withdrawal.) If a withdrawal is greater than the Enhanced Income Amount plus any Income Rollover Amount and the Contract Value (less the Enhanced Income Amount and any Income Rollover Amount) is lower than the Protected Payment Base, the Protected Payment Base will be reduced by an amount that is greater than the excess amount withdrawn.
The amount available for withdrawal under the Contract must be sufficient to support any withdrawal that would otherwise exceed the Enhanced Income Amount plus any Income Rollover Amount or your Rider will terminate (see the Depletion of Contract Value subsection below).
For information regarding taxation of withdrawals, see FEDERAL TAX ISSUES.
Early Withdrawal
If an Early Withdrawal occurs, we will (immediately following the Early Withdrawal) reduce the Protected Payment Base either on a proportionate basis or by the total withdrawal amount, whichever results in a lower Protected Payment Base. Early Withdrawals may have the effect of reducing future benefits by more than the dollar amount of the withdrawal. See Example 5 in the ENHANCED INCOME SELECT 2 (SINGLE & JOINT) APPENDIX for a numerical example of the adjustments to the Protected Payment Base as a result of an Early Withdrawal.
Required Minimum Distributions
No adjustment will be made to the Protected Payment Base as a result of a withdrawal that exceeds the Enhanced Income Amount plus any Income Rollover Amount immediately prior to the withdrawal, provided:
· such withdrawal (an “RMD Withdrawal”) is for purposes of satisfying the minimum distribution requirements of Section 401(a)(9) and related Treasury Regulations,
· you have authorized us to calculate and make periodic distribution of the Annual RMD Amount for the Calendar Year required based on the payment frequency you have chosen,
· the Annual RMD Amount is based on the previous year-end fair market value of this Contract only,
· only RMD withdrawals are made from the Contract during the Contract Year, and
· the youngest Designated Life is age 59½ or older.
Once a withdrawal occurs, including an RMD Withdrawal, no Annual Credit will be added to the Protected Payment Base. In addition, Annual Credit eligibility cannot be reinstated or restarted by any Automatic or Owner-Elected Reset. Any Annual Credit added during any Contract Year before Annual Credit eligibility is lost will continue to be counted in the Protected Payment Base.
We reserve the right to modify or eliminate the treatment of RMD Withdrawals under this Rider if there is any change to the Internal Revenue Code or Treasury Regulations relating to required minimum distributions, including the issuance of relevant IRS guidance. If we exercise this right, we will provide 30 days advance notice to the Owner.
See Example 6 in the ENHANCED INCOME SELECT 2 (SINGLE & JOINT) APPENDIX for numerical examples that describe what occurs when only withdrawals of the Annual RMD Amount are made during a Contract Year and when withdrawals of the Annual RMD Amount plus other non-RMD Withdrawals are made during a Contract Year.
See FEDERAL TAX ISSUES – Qualified Contracts – Required Minimum Distributions.
Depletion of Contract Value
If the youngest Designated Life is younger than age 59½ when the Contract Value is zero (0) (such as through withdrawals, fees, or market performance), the Rider will terminate.
If the youngest Designated Life is age 59½ or older and the Contract Value was reduced to zero (0) by a withdrawal that exceeds the Enhanced Income Amount plus any Income Rollover Amount (excluding an RMD withdrawal), the Rider will terminate and you will not receive payments of the Guaranteed Lifetime Income Amount.
If the youngest Designated Life is age 59½ or older and the Contract Value was reduced to zero (0) by a withdrawal that did not exceed the Enhanced Income Amount plus any Income Rollover Amount, (except that an RMD Withdrawal may exceed the Enhanced Income Amount plus any Income Rollover Amount), the following will apply:
· the remaining Enhanced Income Amount will be automatically paid for that Contract Year. The Income Rollover Amount will no longer apply going forward. Starting on the next Contract Anniversary, the Guaranteed Lifetime Income Amount will be paid each year until the death of all Designated Lives eligible for lifetime benefits,
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· the Guaranteed Lifetime Income Amount will be paid under a series of pre-authorized withdrawals under a payment frequency as elected by the Owner, but no less frequently than annually, until the date of death of all Designated Lives,
· no additional Purchase Payments will be accepted under the Contract, and
· the Contract will cease to provide any death benefit (amount will be zero (0)).
The Guaranteed Lifetime Income Amount will be calculated by multiplying the Protected Payment Base, at the time the Contract Value equals zero (0), by the Guaranteed Lifetime Income Percentage.
Reset of Protected Payment Base
Regardless of which reset option is used, on and after each Reset Date, the provisions of this Rider shall apply in the same manner as they applied when the Rider was originally issued, except that an Automatic Reset or an Owner-Elected Reset will not reinstate eligibility for the Annual Credit as described above. The limitations and restrictions on Purchase Payments and withdrawals, the deduction of Rider charges and any future reset options available on and after the Reset Date, will again apply and will be measured from that Reset Date. A reset occurs when the Protected Payment Base is changed to an amount equal to the Contract Value as of the Reset Date.
Automatic Reset. On each Contract Anniversary while this Rider is in effect and before the Annuity Date, we will automatically reset the Protected Payment Base to an amount equal to 100% of the Contract Value, if the Protected Payment Base, after any Annual Credits are applied, is at least $1.00 less than the Contract Value on that Contract Anniversary. See Example 7 in the ENHANCED INCOME SELECT 2 (SINGLE & JOINT) SAMPLE CALCULATIONS APPENDIX for a numerical example of an Automatic Reset.
Owner-Elected Resets (Non-Automatic). You may, on any Contract Anniversary, elect to reset the Protected Payment Base to an amount equal to 100% of the Contract Value. An Owner-Elected Reset may be elected while Automatic Resets are in effect. See Example 7 in the Sample Calculations for a numerical example of an Automatic Reset
If you elect this option, your election must be received, In Proper Form, within sixty (60) calendar days after the Contract Anniversary on which the reset is effective. The reset will be based on the Contract Value as of that Contract Anniversary. Your election of this option may result in a reduction in the Protected Payment Base and Enhanced Income Amount. Generally, the reduction will occur when your Contract Value is less than the Protected Payment Base as of the Contract Anniversary you elected the reset. There may be situations where you may want to elect an Owner-Elected Reset. For example, one scenario where an Owner-Elected Reset may be used is when no Automatic Resets have occurred and the youngest Designated Life has reached a higher age band (e.g. was 64 years of age and turned 65). The attainment of a higher age band may provide for a higher Enhanced Income Percentage which could provide a higher annual withdrawal amount. See Example 8 in the ENHANCED INCOME SELECT 2 (SINGLE & JOINT) SAMPLE CALCULATIONS APPENDIX for a numerical example how an Owner-Elected Reset may be used in this situation. You are strongly advised to work with your financial professional prior to electing an Owner-Elected Reset. We will provide you with written confirmation of your election.
Subsequent Purchase Payments
If we accept additional Purchase Payments after the Rider Effective Date, we will increase the Protected Payment Base by the amount of the Purchase Payments. See Example 2 in the ENHANCED INCOME SELECT 2 (SINGLE & JOINT) SAMPLE CALCULATIONS APPENDIX for a numerical example of adjustments to the Protected Payment Base when an additional Purchase Payment is made. We reserve the right to reject or restrict, at our discretion, any additional Purchase Payments. If we exercise our right to reject or restrict any future Purchase Payments, we will provide 30 days advance notice to the Owner. If we decide to no longer accept Purchase Payments, we will not accept subsequent Purchase Payments for your Contract and any limitations will be applied uniformly to all Contract Owners.
Annuitization
If you annuitize the Contract at the maximum Annuity Date specified in your Contract, this Rider is still in effect at the time of your election, and a Life Only or Joint and Survivor Life Only fixed annuity option is chosen, the annuity payments will be equal to the greater of:
· the Life Only or Joint and Survivor Life Only fixed annual payment amount based on the terms of your Contract, or
· the Guaranteed Lifetime Income Amount in effect at the maximum Annuity Date.
The Guaranteed Lifetime Income Amount will be less than the amount you may have received under the Enhanced Income Amount prior to annuitizing your Contract.
If you annuitize the Contract at any time prior to the maximum Annuity Date specified in your Contract, your annuity payments will be determined in accordance with the terms of your Contract. The Protected Payment Base, Enhanced Income Amount, and Guaranteed Lifetime Income Amount under this Rider will not be used in determining any annuity payments. and your annuity payments received may be less than the Enhanced Income Amount or Guaranteed Lifetime Income Amount you are entitled to receive
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under the Rider. Work with your financial professional to determine if you should annuitize your Contract before the maximum Annuity Date or stay in the accumulation phase and continue to take withdrawals under the Rider.
Continuation of Rider if Surviving Spouse Continues Contract
If the Owner dies and the Surviving Spouse (who is also a Designated Life eligible for lifetime benefits) elects to continue the Contract in accordance with its terms, the Surviving Spouse may continue to take withdrawals of the Enhanced Income Amount plus any Income Rollover Amount until the Contract Value is reduced to zero (0) and then receive the Guaranteed Lifetime Income Amount under this Rider, until the day of death of the Surviving Spouse or until the rider terminates. See Termination subsection below. If the Contract Value is equal to zero (0) when the Owner dies, the Surviving Spouse will receive the Guaranteed Lifetime Income Amount under this Rider, until the day of death of the Surviving Spouse. If no withdrawals have occurred after the youngest Designated Life reached 59½ and the Contract Value is greater than zero (0), the Enhanced Income Percentage and corresponding Enhanced Income Amount will be based on the age when the Surviving Spouse first takes a withdrawal. If the youngest Designated Life reached 59½ or older and the Contract Value is depleted to zero (0) by a withdrawal that did not exceed the Enhanced Income Amount plus any Income Rollover Amount, the Surviving Spouse will receive the Guaranteed Lifetime Income Percentage and corresponding Guaranteed Lifetime Income Amount applicable to their Contract regardless of when the first withdrawal occurred. The Surviving Spouse may elect any of the reset options available under this Rider for subsequent Contract Anniversaries.
The surviving spouse may elect to receive any death benefit proceeds instead of continuing the Contract (see DEATH BENEFITS AND OPTIONAL DEATH BENEFIT RIDERS – Death Benefits).
Ownership and Beneficiary Changes
Changes to the Contract Owner, Annuitant and/or Beneficiary designations and changes in marital status, including a dissolution of marriage, may adversely affect the benefits of this Rider. A particular change may make a Designated Life ineligible to receive lifetime income benefits under this Rider. As a result, the Rider may remain in effect and you may pay for benefits that you will not receive. You are strongly advised to work with your financial professional and consider your options prior to making any Owner, Annuitant and/or Beneficiary changes to your Contract. See Rider Terms – Designated Lives above and ADDITIONAL INFORMATION – Changes to Your Contract.
Termination
You cannot request a termination of the Rider. Except as otherwise provided below, the Rider will automatically terminate on the earliest of:
· the date of the death of all Designated Lives eligible for lifetime benefits,
· upon the death of the first Designated Life, if a death benefit is payable and a Surviving Spouse who chooses to continue the Contract is not a Designated Life eligible for lifetime benefits,
· upon the death of the first Designated Life, if a death benefit is payable and the Contract is not continued by a Surviving Spouse who is a Designated Life eligible for lifetime benefits,
· the date of death of the first Designated Life eligible for lifetime benefits, if both Designated Lives are Joint Owners and there is a change in marital status, the Rider will terminate upon the death of the first Designated Life who is a Contract Owner,
· the day the Contract is terminated in accordance with the provisions of the Contract,
· the day that neither Designated Life is an Owner (or Annuitant, in the case of a custodial owned IRA) (this bullet does not apply if this Rider is issued in California),
· in California, if neither Designated Life is an Owner (or Annuitant in the case of a custodial owned IRA), upon the earlier of the death of the first Designated Life or when a death benefit becomes payable under the Contract,
· the Annuity Date (see the Annuitization subsection for additional information),
· the day the Contract Value is reduced to zero (0) as a result of an Excess Withdrawal (see Rider Terms), or
· the day the Contract Value is reduced to zero (0) (such as through withdrawals, fees, or market performance) if the youngest Designated Life is younger than age 59½.
See the Depletion of Contract Value subsection for situations where the Rider will not terminate when the Contract Value is reduced to zero (0).
Sample Calculations
Hypothetical sample calculations are in the attached ENHANCED INCOME SELECT 2 (SINGLE & JOINT) APPENDIX. The examples are based on certain hypothetical assumptions and are for example purposes only. These examples are not intended to serve as projections of future investment returns.
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PACIFIC LIFE AND THE SEPARATE ACCOUNT
Pacific Life
Pacific Life Insurance Company is a life insurance company domiciled in Nebraska. Along with our subsidiaries and affiliates, our operations include life insurance, annuity, mutual funds, broker-dealer operations, and investment advisory services. At the end of 2020, we had $509.9 billion of individual life insurance in force and total admitted assets of approximately $146 billion.
We are authorized to conduct our life insurance and annuity business in the District of Columbia and in all states except New York. Our executive office is located at 700 Newport Center Drive, Newport Beach, California 92660.
We were originally organized on January 2, 1868, under the name “Pacific Mutual Life Insurance Company of California” and reincorporated as “Pacific Mutual Life Insurance Company” on July 22, 1936. On September 1, 1997, we converted from a mutual life insurance company to a stock life insurance company ultimately controlled by a mutual holding company and were authorized by California regulatory authorities to change our name to Pacific Life Insurance Company. On September 1, 2005, Pacific Life changed from a California corporation to a Nebraska corporation. Pacific Life is a subsidiary of Pacific LifeCorp, a holding company, which, in turn, is a subsidiary of Pacific Mutual Holding Company, a mutual holding company. Under their respective charters, Pacific Mutual Holding Company must always hold at least 51% of the outstanding voting stock of Pacific LifeCorp, and Pacific LifeCorp must always own 100% of the voting stock of Pacific Life. Owners of Pacific Life’s annuity contracts and life insurance policies have certain membership interests in Pacific Mutual Holding Company, consisting principally of the right to vote on the election of the Board of Directors of the mutual holding company and on other matters, and certain rights upon liquidation or dissolutions of the mutual holding company.
Our subsidiary, Pacific Select Distributors, LLC (PSD) serves as the principal underwriter (distributor) for the Contracts. PSD is located at 700 Newport Center Drive, Newport Beach, California 92660. We and PSD enter into selling agreements with broker-dealers whose financial professionals are authorized by state insurance departments to sell the Contracts.
We may provide you with reports of our ratings both as an insurance company and as to our claims-paying ability with respect to our General Account assets.
Separate Account A
Separate Account A was established on September 7, 1994 as a separate account of ours, and is registered with the SEC under the Investment Company Act of 1940 (the “1940 Act”), as a type of investment company called a “unit investment trust.” We established the Separate Account under the laws of the state of California. The Separate Account is maintained under the laws of the state of Nebraska.
Obligations arising under your Contract are our general corporate obligations. We are also the legal owner of the assets in the Separate Account. Assets of the Separate Account attributed to the reserves and other liabilities under the Contract and other contracts issued by us that are supported by the Separate Account may not be charged with liabilities arising from any of our other business; any income, gain or loss (whether or not realized) from the assets of the Separate Account are credited to or charged against the Separate Account without regard to our other income, gain or loss. We must keep assets in the Separate Account equal to the reserves and contract liabilities (i.e. amounts at least equal to the aggregate variable account value) sufficient to pay obligations under the contracts funded by the Separate Account.
We may invest money in the Separate Account in order to commence its operations and for other purposes, but not to support contracts other than variable annuity contracts. A portion of the Separate Account’s assets may include accumulations of charges we make against the Separate Account and investment results of assets so accumulated. These additional assets are ours and we may transfer them to our General Account at any time; however, before making any such transfer, we will consider any possible adverse impact the transfer might have on the Separate Account. Subject to applicable law, we reserve the right to transfer our assets in the Separate Account to our General Account.
The Separate Account may not be the sole investor in the Funds. Investment in a Fund by other separate accounts in connection with variable annuity and variable life insurance contracts may create conflicts. See the Prospectus and SAI for the Funds for more information.
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The following summary of federal income tax issues is based on our understanding of current tax laws and regulations, which may be changed by legislative, judicial or administrative action. The summary is general in nature and is not intended as tax advice. Moreover, it does not consider any applicable foreign, state or local tax laws. We do not make any guarantee regarding the tax status, federal, foreign, state or local, of any Contract or any transaction involving the Contracts. Accordingly, you should consult a qualified tax advisor for complete information and advice before purchasing a Contract. Additional tax information is included in the SAI. We reserve the right to amend this Contract without the Owner’s consent to reflect any clarifications that may be needed or are appropriate to maintain its tax qualification or to conform this Contract to any applicable changes in the tax qualification requirements.
Diversification Requirements and Investor Control
Section 817(h) of the Code provides that the investments underlying a variable annuity must satisfy certain diversification requirements in order for the contract to be treated as an annuity contract and qualify for tax deferral. We believe the underlying Variable Investment Options for the contract meet these requirements. Details on these diversification requirements appear in the Fund SAIs.
In addition, for a variable annuity contract to qualify for tax deferral, assets in the separate accounts supporting the contract must be considered to be owned by the insurance company and not by the contract owner. Under current U.S. tax law, if a contract owner has excessive control over the investments made by a separate account, or the underlying fund, the contract owner will be taxed currently on income and gains from the account or fund. In other words, in such a case of investor control the contract owner would not derive the tax benefits normally associated with variable annuities. For more information regarding investor control, please refer to the contract SAI.
Taxation of Annuities – General Provisions
Section 72 of the Code governs the taxation of annuities in general, and we designed the Contracts to meet the requirements of Section 72 of the Code. We believe that, under current law, the Contract will be treated as an annuity for federal income tax purposes if the Contract Owner is a natural person or an agent for a natural person, and that we (as the issuing insurance company), and not the Contract Owner(s), will be treated as the owner of the investments underlying the Contract. Accordingly, no tax should be payable by you as a Contract Owner as a result of any increase in Contract Value until you receive money under your Contract. You should, however, consider how amounts will be taxed when you do receive them. The following discussion assumes that your Contract will be treated as an annuity for federal income tax purposes.
Non-Qualified Contracts – General Rules
These general rules apply to Non-Qualified Contracts. As discussed below, however, tax rules may differ for Qualified Contracts and you should consult a qualified tax advisor if you are purchasing a Qualified Contract.
Taxes Payable
A Contract Owner is not taxed on the increases in the value of a Contract until an amount is received or deemed to be received. An amount could be received or deemed to be received, for example, if there is a partial distribution, a lump sum distribution, an Annuity payment or a material change in the Contract or if any portion of the Contract is transferred, pledged or assigned. See the Addition of Optional Rider or Material Change to Contract section below. Increases in Contract Value that are received or deemed to be received are taxable to the Contract Owner as ordinary income. Distributions of net investment income or capital gains that each Subaccount receives from its corresponding Portfolio are automatically reinvested in such Portfolio unless we, on behalf of the Separate Account, elect otherwise. As noted above, you will be subject to federal income taxes on the investment income from your Contract only when it is distributed to you.
Any taxable distribution of the investment income from your Contract may also be subject to a net investment income tax of 3.8%. This tax applies to various investment income such as interest, dividends, royalties, payments from annuities, and the disposition of property, but only to the extent a taxpayer’s modified adjusted gross income exceeds certain thresholds ($200,000 for individuals/$250,000 if married filing jointly). Please speak to your tax advisor about this tax.
Non-Natural Persons as Owners
If a contract is not owned or held by a natural person or as agent for a natural person, the contract generally will not be treated as an “annuity” for tax purposes, meaning that the contract owner will be subject to current tax on annual increases in Contract Value at ordinary income rates unless some other exception applies. Certain entities, such as some trusts, may be deemed to be acting as agents for natural persons. Corporations, including S corps, C corps, LLCs, partnerships and FLPs, and tax-exempt entities are non-natural persons that will not be deemed to be acting as agents for natural persons.
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Addition of Optional Rider or Material Change to Contract
The addition of a rider to the Contract, or a material change in the Contract’s provisions, such as a change in Contract ownership or an assignment of the Contract, could cause it to be considered newly issued or entered into for tax purposes, and thus could cause a taxable event or the Contract to lose certain grandfathered tax status. Please contact your tax advisor for more information.
Taxes Payable on Withdrawals Prior to the Annuity Date
Amounts you withdraw before annuitization, including amounts withdrawn from your Contract Value in connection with partial withdrawals for payment of any charges and fees, will be treated first as taxable income to the extent that your Contract Value exceeds the aggregate of your Purchase Payments reduced by non-taxable amounts previously received (investment in the Contract), and then as nontaxable recovery of your Purchase Payments. Therefore, you include in your gross income the smaller of: a) the amount of the partial withdrawal, or b) the amount by which your Contract Value immediately before you receive the distribution exceeds your investment in the Contract at that time.
Exceptions to this rule are distributions in full discharge of your Contract (a full surrender) or distributions from contracts issued and investments made before August 14, 1982.
If at the time of a partial withdrawal your Contract Value does not exceed your investment in the Contract, then the withdrawal will not be includable in gross income and will simply reduce your investment in the Contract.
The assignment or pledge of (or agreement to assign or pledge) the value of the Contract for a loan will be treated as a withdrawal subject to these rules. You should consult your tax advisor for additional information regarding taking a partial or a full distribution from your Contract.
Multiple Contracts (Aggregation Rule)
Multiple Non-Qualified Contracts that are issued after October 21, 1988, by us or our affiliates to the same Owner during the same calendar year are treated as one Contract for purposes of determining the taxation of distributions (the amount includable in gross income under Code Section 72(e)) prior to the Annuity Date from any of the Contracts. A Contract received in a tax-free exchange under Code Section 1035 may be treated as a new Contract for this purpose. For Contracts subject to the Aggregation Rule, the values of the Contracts and the investments in the Contracts should be added together to determine the taxation under Code Section 72(e). Withdrawals will be treated first as withdrawals of income until all of the income from all such Contracts is withdrawn. The Treasury Department has specific authority under Code Section 72(e)(11) to issue regulations to prevent the avoidance of the income-out-first rules for withdrawals prior to the Annuity Date through the serial purchase of Contracts or otherwise. As of the date of this Prospectus there are no regulations interpreting these aggregation provisions.
10% Tax Penalty Applicable to Certain Withdrawals and Annuity Payments
The Code provides that the taxable portion of a withdrawal or other distribution may be subject to a tax penalty equal to 10% of that taxable portion unless the withdrawal is:
· made on or after the date you reach age 59½,
· made by a Beneficiary after your death,
· attributable to your becoming disabled,
· any payments annuitized using a life contingent annuity option,
· attributable to an investment in the Contract made prior to August 14, 1982, or
· any distribution that is a part of a series of substantially equal periodic payments (Code Section 72(q) payments) made (at least annually) over your life (or life expectancy) or the joint lives (or life expectancies) of you and your designated beneficiary.
Additional exceptions may apply to certain Qualified Contracts (see Taxes Payable on Annuity Payments and the applicable Qualified Contracts).
Taxes Payable on Optional Rider Charges
It is our understanding that the charges relating to any optional rider are not subject to current taxation and we will not report them as such. However, Treasury or the IRS may determine that these charges should be treated as partial withdrawals subject to current taxation to the extent of any gain and, if applicable, the 10% tax penalty. We reserve the right to report any optional rider charges as partial withdrawals if we believe that we would be expected to report them in accordance with Treasury Regulations or IRS guidance.
Distributions After the Annuity Date
After you annuitize, a portion of each annuity payment you receive under a Contract generally will be treated as a partial recovery of Investments (as used here, “Investments” means the aggregate Purchase Payments less any amounts that were previously received under the Contract but not included in income) and will not be taxable. (In certain circumstances, subsequent modifications to an initially-established payment pattern may result in the imposition of a tax penalty.) The remainder of each annuity payment will be taxed as ordinary income. However, after the full amount of aggregate Investments has been recovered, the full amount of each annuity payment will be taxed as ordinary income. Exactly how an annuity payment is divided into taxable and non-taxable portions
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depends on the period over which annuity payments are expected to be received, which in turn is governed by the form of annuity selected and, where a lifetime annuity is chosen, by the life expectancy of the Annuitant(s) or payee(s). Such a payment may also be subject to a tax penalty if taken prior to age 59½.
For periodic (annuity) payments, we will default your state tax withholding (as applicable) based upon the marital status and allowance(s) provided for your federal taxes or, if no withholding instructions are provided, we will default to your resident state’s prescribed withholding default (if applicable). Please consult with a tax advisor for additional information, including whether your resident state has a specific version of the W-4P form that should be submitted to us with state-specific income tax information.
Distributions to Beneficiary After Contract Owner’s Death
Generally, the same tax rules apply to amounts received by the Beneficiary as those that apply to the Contract Owner, except that the early withdrawal tax penalty does not apply. Thus, any annuity payments or lump sum withdrawal will be divided into taxable and non-taxable portions.
If death occurs after the Annuity Date, but before the expiration of a period certain option, the Beneficiary will recover the balance of the Investments as payments are made and may be allowed a deduction on the final tax return for the unrecovered Investments. A lump sum payment taken by the Beneficiary in lieu of remaining monthly annuity payments is not considered an annuity payment for tax purposes. The portion of any lump sum payment to a Beneficiary in excess of aggregate unrecovered Investments would be subject to income tax.
Contract Owner’s Estate
Generally, any amount payable to a Beneficiary after the Contract Owner’s death, whether before or after the Annuity Date, will be included in the estate of the Contract Owner for federal estate tax purposes. If the inclusion of the value of the Contract triggers a federal estate tax to be paid, the Beneficiary may be able to use a deduction called Income in Respect of Decedent (IRD) in calculating the income taxes payable upon receipt of the death benefit proceeds. In addition, designation of a non-spouse Beneficiary who either is 37½ or more years younger than a Contract Owner or is a grandchild of a Contract Owner may have Generation Skipping Transfer Tax (GSTT) consequences under section 2601 of the Code. You should consult with a qualified tax advisor if you have questions about federal estate tax, IRD, or GSTT.
Gifts of Annuity Contracts
Generally, gifts of Non-Qualified Contracts prior to the annuity start date will trigger tax reporting to the donor on the gain on the Contract, with the donee getting a stepped-up basis for the amount included in the donor’s income. The 10% early withdrawal tax penalty and gift tax also may be applicable. This provision does not apply to transfers between spouses or incident to a divorce, or transfers to and from a trust acting as agent for the Owner or the Owner’s spouse.
Tax Withholding for Non-Qualified Contracts
Unless you elect to the contrary, any amounts you receive under your Contract that are attributable to investment income will be subject to withholding to meet federal income tax obligations. For nonperiodic distributions, you will have the option to provide us with withholding information at the time of your withdrawal request. If you do not provide us with withholding information, we will generally withhold 10% of the taxable distribution amount and remit it to the IRS. For periodic (annuity) payments, the rate of withholding will be determined on the basis of the withholding information you provide to us. If you do not provide us with withholding information, we are required to determine the Federal income tax withholding according to the then current defaults for marital status and number of exemptions. State and local withholding may apply different defaults and will be determined by applicable law.
Certain states have indicated that pension and annuity withholding will apply to payments made to residents.
Please call (800) 722-4448 with any questions about the required withholding information. financial professional may call us at (800) 722-2333.
Tax Withholding for Non-resident Aliens or Non U.S. Persons
Taxable distributions to Contract Owners who are non-resident aliens or other non U.S. persons are generally subject to U.S. federal income tax withholding at a 30% rate, unless a lower treaty rate applies. Prospective foreign owners are advised to consult with a tax advisor regarding the U.S., state and foreign tax treatment of a Contract. Currently, we require all Contract Owners to be a U.S. person (citizen) or a U.S. resident alien.
Exchanges of Non-Qualified Contracts (1035 Exchanges)
You may make your initial or an additional Purchase Payment through an exchange of an existing annuity contract or endowment life insurance contract pursuant to Section 1035 of the Code (a 1035 exchange). The exchange can be affected by completing the Transfer/ Exchange form, indicating in the appropriate section of the form that you are making a 1035 exchange and submitting any applicable state replacement form. The form is available by calling your financial professional, by calling our Contract Owner number at (800) 722-4448, or on our website at www.PacificLife.com. Financial professionals can call (800) 722-2333. Once completed, the form should be mailed to us. If you are making an initial Purchase Payment, a completed Contract application should also be attached.
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In general terms, Section 1035 of the Code provides that no gain or loss is recognized when you exchange one annuity or life insurance contract for another annuity contract. Transactions under Section 1035, however, may be subject to special rules and may require special procedures and record keeping, particularly if the exchanged annuity contract was issued prior to August 14, 1982. You should consult your tax advisor prior to affecting a 1035 exchange.
Partial 1035 Exchanges and Annuitization
A partial exchange is the direct transfer of only a portion of an existing annuity’s Contract Value to a new annuity contract. Under Rev. Proc. 2011-38 a partial exchange will be treated as tax-free under Code Section 1035 if there are no distributions, from either annuity, within 180 calendar days after the partial 1035 exchange. Any distribution taken during the 180 calendar days may jeopardize the tax-free treatment of the partial exchange. Such determination will be made by the IRS, using general tax principals, to determine the substance, and thus the treatment of the transaction. In addition, annuity payments that are based on one or more lives or for a period of 10 or more years (as described in Code Section 72(a)(2)) will not be treated as a distribution from either the old or new contract when determining whether the tax treatment described in Rev. Proc. 2011-38 will apply. Rev. Proc. 2011-38 applies to partial exchanges and partial annuitizations on or after October 24, 2011.
You should consult your tax advisor prior to affecting a partial 1035 exchange or a partial annuitization.
Impact of Federal Income Taxes
In general, in the case of Non-Qualified Contracts, if you are an individual and expect to accumulate your Contract Value over a relatively long period of time without making significant withdrawals, there may be federal income tax advantages in purchasing such a Contract. This is because any increase in Contract Value is not subject to current taxation. Income taxes are deferred until the money is withdrawn, at which point taxation occurs only on the gain from the investment in the Contract. With income taxes deferred, you may accumulate more money over the long term through a variable annuity than you may through non-tax-deferred investments. The advantage may be greater if you decide to liquidate your Contract Value in the form of monthly annuity payments after your retirement, or if your tax rate is lower at that time than during the period that you held the Contract, or both.
When withdrawals or distributions are taken from the variable annuity, the gain is taxed as ordinary income. This may be a potential disadvantage because money that had been invested in other types of assets may qualify for a more favorable federal tax rate. For example, the tax rate applicable both to the sale of capital gain assets held more than 1 year and to the receipt of qualifying dividends by individuals is a maximum of 20% (as low as 0% for lower-income individuals). In contrast, an ordinary income tax rate of up to 37% applies to taxable withdrawals on distributions from a variable annuity. Also, withdrawals or distributions taken from a variable annuity prior to attaining age 59½ may be subject to a tax penalty equal to 10% of the taxable portion, although exceptions to the tax penalty may apply.
An owner of a variable annuity cannot deduct or offset losses on transfers to or from Subaccounts, or at the time of any partial withdrawals. Additionally, if you surrender your Contract and your Contract Value is less than the aggregate of your investments in the Contract (reduced by any previous non-taxable distributions), you cannot deduct the ordinary income loss as a miscellaneous itemized deduction subject to the 2% floor of AGI. This provision of the 2017 Tax Cuts and Jobs Act is effective for taxable years beginning after December 31, 2017 and sunsets after 2025. Consult with your tax advisor regarding the impact of federal income taxes on your specific situation.
Although the Separate Account is registered as an investment company, it is not a separate taxpayer for purposes of the Code. The earnings of the Separate Account are taxed as part of our operations. No charge is made against the Separate Account for our federal income taxes (excluding the charge for premium taxes), but we will review, periodically, the question of charges to the Separate Account or your Contract for such taxes. Such a charge may be made in future years for any federal income taxes that would be attributable to the Separate Account or to our operations with respect to your Contract, or attributable, directly or indirectly, to investments in your Contract.
Under current law, we may incur state and local taxes (in addition to premium taxes) in several states. At present, these taxes are not significant and they are not charged against the Contract or the Separate Account. If there is a material change in applicable state or local tax laws, the imposition of any such taxes upon us that are attributable to the Separate Account or to our operations with respect to your Contract may result in a corresponding charge against the Separate Account or your Contract.
Given the uncertainty of future changes in applicable federal, state or local tax laws, we cannot appropriately describe the effect a tax law change may have on taxes that would be attributable to the Separate Account or your Contract.
Qualified Contracts – General Rules
The Contracts are available to a variety of Qualified Plans and IRAs. Tax restrictions and consequences for Contracts under each type of Qualified Plan and IRAs differ from each other and from those for Non-Qualified Contracts. No attempt is made herein to provide more than general information about the use of the Contract with the various types of Qualified Plans and IRAs. Participants under such Qualified Plans, as well as Contract Owners, Annuitants and Beneficiaries, are cautioned that the rights of any person to any benefits under such Qualified Plans may be subject to the terms and conditions of the Plans themselves or limited by applicable law, regardless of the terms and conditions of the Contract issued in connection therewith.
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Tax Deferral
It is important to know that Qualified Plans such as 401(k)s, as well as IRAs, are already tax-deferred. Therefore, an annuity contract should be used to fund an IRA or Qualified Plan to benefit from the annuity’s features other than tax deferral. Other benefits of using a variable annuity to fund a Qualified Plan or an IRA include the lifetime income options, guaranteed death benefit options and the ability to transfer among Investment Options without sales or withdrawal charges. You should consider if the Contract is a suitable investment if you are investing through a Qualified Plan or IRA.
Taxes Payable
Generally, amounts received from Qualified Contracts are taxed as ordinary income under Section 72, to the extent that they are not treated as a tax free recovery of after-tax contributions (if any). Amounts you withdraw before annuitization, including amounts withdrawn from your Contract Value in connection with partial withdrawals for payment of any charges and fees, will be treated as ordinary income. Different rules apply for Roth IRAs. Consult your tax advisor before requesting a distribution from a Qualified Contract.
10% Tax Penalty for Early Withdrawals
Generally, distributions from IRAs and Qualified Plans that occur before you attain age 59½ are subject to a 10% tax penalty imposed on the amount of the distribution that is includable in gross income, with certain exceptions. These exceptions include distributions:
· made to a beneficiary after the owner’s/participant’s death,
· attributable to the owner/participant becoming disabled under Section 72(m)(7),
· that are part of a series of substantially equal periodic payments (also referred to as SEPPs or 72(t) payments) made (at least annually) over your life (or life expectancy) or the joint lives (or joint life expectancies) of you and your designated beneficiary, and after you have separated from service (if payments are made from a qualified retirement plan),
· for certain higher education expenses (IRAs only),
· used to pay for certain health insurance premiums or medical expenses (IRAs only),
· for costs related to the purchase of your first home (IRAs only), and
· (except for IRAs) made to an employee after separation from service if the employee separates from service during or after the calendar year in which he or she attains age 55 (or age 50 in the case of a qualified public safety employee).
Tax Withholding for Qualified Contracts
Distributions from a Contract under a Qualified Plan (not including an individual retirement annuity subject to Code Section 408 or Code Section 408A) to an employee, surviving spouse, or former spouse who is an alternate payee under a qualified domestic relations order, in the form of a lump sum settlement or periodic annuity payments for a fixed period of fewer than 10 years are subject to mandatory income tax withholding of 20% of the taxable amount of the distribution, unless:
· the distributee directs the transfer of such amounts in cash to another Qualified Plan or a traditional IRA, or
· the payment is a minimum distribution required under the Code.
The taxable amount is the amount of the distribution less the amount allocable to after-tax contributions. All other types of taxable distributions are subject to 10% federal withholding unless the distributee elects not to have withholding apply.
For periodic (annuity) payments, the rate of withholding will be determined on the basis of the withholding information you provide to us. If you do not provide us with withholding information, we are required to determine the Federal income tax withholding according to the then current defaults for marital status and number of exemptions. State and local withholding may apply different defaults and will be determined by applicable law.
Certain states have indicated that pension and annuity withholding will apply to payments made to residents.
IRAs and Other Qualified Contracts with Optional Benefit Riders
As of the date of this Prospectus, there are special considerations for purchases of any optional living or death benefit riders. Treasury Regulations state that Individual Retirement Accounts (IRAs) may generally not invest in life insurance contracts. We believe that these Regulations do not prohibit the living or death benefit riders from being added to your Contract if it is issued as a Traditional IRA, Roth IRA, SEP IRA or SIMPLE IRA. However, the law is unclear and it is possible that a Contract that has living or death benefit riders and is issued as a Traditional IRA, Roth IRA, SEP IRA or SIMPLE IRA could be disqualified and may result in increased taxes to the Owner.
Similarly, section 401 plans, 457(b) annuities and IRAs (but not Roth IRAs) can only offer incidental death benefits. The IRS could take the position that the enhanced death benefits provided by optional benefit riders are not incidental. In addition, to the extent that the optional benefit riders alter the timing or the amount of the payment of distributions under a Qualified Contract, the riders cannot be paid out in violation of the minimum distribution rules of the Code.
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It is our understanding that the charges relating to the optional benefit riders are not subject to current taxation and we will not report them as such. However, Treasury or the IRS may determine that these charges should be treated as partial withdrawals subject to current income taxation to the extent of any gain and, if applicable, the 10% tax penalty. We reserve the right to report the rider charges as partial withdrawals if we believe that we would be expected to report them in accordance with Treasury Regulations or IRS guidance.
Required Minimum Distributions
Treasury Regulations provide that you cannot keep assets in Qualified Plans or IRAs indefinitely. Eventually they are required to be distributed; at that time (the Required Beginning Date (RBD)), Required Minimum Distributions (RMDs) are the amount that must be distributed each year. The information below is for Qualified Contracts held in either a Qualified Plan, or IRA, prior to the annuity start date.
Under Section 401 of the Code (for Qualified Plans) and Section 408 of the Code (for IRAs), the entire interest under the Contract must be distributed to the Owner/Annuitant no later than the Owner/Annuitant’s RBD, or distributions over the life of the Owner/Annuitant (or the Owner/Annuitant and his beneficiary) must begin no later than the RBD.
The RBD for distributions from a Qualified Contract maintained for an IRA under Section 408 of the Code is generally April 1 of the calendar year following the year in which the Owner/Annuitant reaches age 72 (or 70½ if born prior to July 1, 1949). The RBD for a Qualified Contract maintained for a qualified retirement or pension plan under Section 401 of the Code is April 1 of the calendar year following the later of the year in which the Owner/Annuitant reaches age 72 (or 70½ if born prior to July 1, 1949), or, if the plan so provides, the year in which the Owner/Annuitant retires. There is no RBD for a Roth IRA maintained pursuant to Section 408A of the Code.
The Treasury Regulations require that all IRA holders and Qualified Plan Participants (with one exception discussed below) use the Uniform Lifetime Table to calculate their RMDs.
The Uniform Lifetime Table is based on a joint life expectancy and uses the IRA owner’s actual age and assumes that the beneficiary is 10 years younger than the IRA owner. Note that under these Regulations, the IRA owner does not need to actually have a named beneficiary when they reach the RBD.
The exception noted above is for an IRA owner who has a spouse, who is more than 10 years younger, as the sole beneficiary on the IRA. In that situation, the spouse’s actual age (and life expectancy) will be used in the joint life calculation.
Required Minimum Distributions for Beneficiaries
For Owner/Annuitants who died prior to January 1, 2020, their designated beneficiaries calculate RMDs using the Single Life Table (Table I, Appendix B, Publication 590-B, Distributions from Individual Retirement Arrangements (IRAs)). The table provides a life expectancy factor based on the beneficiary’s age. The account balance is divided by this life expectancy factor to determine the first RMD. The life expectancy is reduced by one for each subsequent year.
For Owner/Annuitants who die after December 31, 2019, the RMD rules for beneficiaries who inherit an account or IRA are different depending on whether the beneficiary is an “eligible designated beneficiary” or not. An eligible designated beneficiary includes a surviving spouse, a disabled individual, a chronically ill individual, a minor child, or an individual who is not more than 10 years younger than the account owner. Certain trusts created for the exclusive benefit of disabled or chronically ill beneficiaries are included. These eligible designated beneficiaries may take their distributions over the beneficiary's life expectancy. However, minor children must still take remaining distributions within 10 years of reaching age 18. Additionally, a surviving spouse beneficiary may delay commencement of distributions until the later of the end of the year that the Owner/Annuitant would have attained age 72, or the surviving spouse’s RBD.
Designated beneficiaries, who are not an eligible designated beneficiary, must withdraw the entire account by the 10th calendar year following the death of the Owner/Annuitant.
Non-designated beneficiaries must withdraw the entire account within 5 years of the Owner/Annuitant’s death if distributions have not begun prior to death. For IRA distributions, see Publication 590-B, Distribution from Individual Retirement Arrangements (IRAs).
The CARES Act waived RMDs for 2020. This waiver applies to the Owner/Annuitant, as well as to the Beneficiary of an Inherited
IRA. If a Beneficiary was subject to the 5 year rule, he or she can now waive the distribution for 2020, effectively taking distributions
over a 6-year period rather than a 5-year period.
Actuarial Value
In accordance with Treasury Regulations, RMDs and Roth IRA conversions may be calculated based on the sum of the contract value and the actuarial value of any additional death benefits and benefits from riders that you have purchased under the Contract. As a result, RMDs and taxes due on Roth IRA Conversions may be larger than if the calculation were based on the contract value only, which may in turn result in an earlier (but not before the required beginning date) distribution under the Contract and an increased amount of taxable income distributed to the contract owner, and a reduction of death benefits and the benefits of any riders.
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RMDs and Annuity Options
For retirement plans that qualify under Section 401 or 408 of the Code, the period elected for receipt of RMDs as annuity payments under Annuity Options 2 and 4 generally may be:
· no longer than the joint life expectancy of the Annuitant and Beneficiary in the year that the Annuitant reaches age 72 (or 70½ if born prior to July 1, 1949),
· must be shorter than such joint life expectancy if the Beneficiary is not the Annuitant’s spouse and is more than 10 years younger than the Annuitant, and
· may be further limited to comply with the RMD requirements for beneficiaries (i.e. the 10-year rule).
Under Annuity Option 3, if the Beneficiary is not the Annuitant’s spouse and is more than 10 years younger than the Annuitant, the 66 2/3% and 100% elections specified below may not be available.
Annuity payments made on or after January 1st of the year the Owner/Annuity turns 72 (or 70½ if born prior to July 1, 1949) are considered RMDs and are therefore not eligible rollover distributions. The Owner/Annuitant may not request a direct or indirect rollover of any annuity payment made on or after this date.
In order to comply with RMD regulations, some riders or benefits may not be available for your Contract.
The following is only a general discussion about types of IRAs and Qualified Plans for which the Contracts may be available. We are not the administrator of any Qualified Plan. The plan administrator and/or custodian, whichever is applicable, (but not us) is responsible for all Plan administrative duties including, but not limited to, notification of distribution options, disbursement of Plan benefits, compliance regulatory requirements and federal and state tax reporting of income/distributions from the Plan to Plan participants and, if applicable, Beneficiaries of Plan participants and IRA contributions from Plan participants. Our administrative duties are limited to administration of the Contract and any disbursements of any Contract benefits to the Owner, Annuitant, or Beneficiary of the Contract, as applicable. Our tax reporting responsibility is limited to federal and state tax reporting of income/distributions to the applicable payee and IRA contributions from the Owner of a Contract, as recorded on our books and records. The Qualified Plan (the plan administrator or the custodian) is required to provide us with information regarding individuals with signatory authority on the Contract(s) owned. If you are purchasing a Qualified Contract, you should consult with your plan administrator and/or a qualified tax advisor. You should also consult with a qualified tax advisor and/or plan administrator before you withdraw any portion of your Contract Value.
Individual Retirement Annuities (“IRAs”)
In addition to “traditional” IRAs established under Code Section 408, there are SEP IRAs under Code Section 408(k), Roth IRAs governed by Code Section 408A and SIMPLE IRAs established under Code Section 408(p). Also, Qualified Plans under Section 401 or 457(b) of the Code that include after-tax employee contributions may be treated as deemed IRAs subject to the same rules and limitations as traditional IRAs. Contributions to each of these types of IRAs are subject to differing limitations. The following is a very general description of each type of IRA and other Qualified Plans.
Traditional IRAs
Traditional IRAs are subject to limitations on the amount that may be contributed each year, the persons who may be eligible to contribute, when rollovers are available and when distributions must commence. Depending upon the circumstances of the individual, contributions to a traditional IRA may be made on a deductible or non-deductible basis.
Annual contributions are generally allowed for persons who have compensation (as defined by the Code) of at least the contribution amount. Distributions of minimum amounts specified by the Code and Treasury Regulations must commence by April 1 of the calendar year following the calendar year in which you attain age 72 (or 70½ if born prior to July 1, 1949). Failure to make mandatory minimum distributions may result in imposition of a 50% tax penalty on any difference between the required distribution amount and the amount actually distributed. Additional distribution rules apply after your death.
You (or your surviving spouse if you die) may rollover funds (such as proceeds from existing insurance policies, annuity contracts or securities) from certain existing Qualified Plans into your traditional IRA if those funds are in cash. This will require you to liquidate any value accumulated under the existing Qualified Plan. Mandatory withholding of 20% may apply to any rollover distribution from your existing Qualified Plan if the distribution is not transferred directly to your traditional IRA. To avoid this withholding you may wish to have cash transferred directly from the insurance company or plan trustee to your traditional IRA.
SIMPLE IRAs
The Savings Incentive Match Plan for Employees of Small Employers (“SIMPLE Plan”) is a type of IRA established under Code Section 408(p)(2). Depending upon the SIMPLE Plan, employers may make plan contributions into a SIMPLE IRA established by each participant of the SIMPLE Plan. Like other IRAs, a 10% tax penalty is imposed on certain distributions that occur before an employee attains age 59½. In addition, the tax penalty is increased to 25% for amounts received or rolled to another IRA or Qualified Plan during the 2-year period beginning on the date an employee first participated in a qualified salary reduction arrangement pursuant
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to a SIMPLE Plan maintained by their employer. Contributions to a SIMPLE IRA will generally include employee salary deferral contributions and employer contributions. Distributions from a SIMPLE IRA may be transferred to another SIMPLE IRA tax free or may be eligible for tax free rollover to a traditional IRA, a 457(b) or other Qualified Plan after the required 2-year period.
SEP-IRAs
A Simplified Employee Pension (SEP) is an employer sponsored retirement plan under which employers are allowed to make contributions toward their employees’ retirement, as well as their own retirement (if the employer is self-employed). A SEP is a type of IRA established under Code Section 408(k). Under a SEP, a separate IRA account called a SEP-IRA is set up by or for each eligible employee and the employer makes the contribution to the account. Like other IRAs, a 10% tax penalty is imposed on certain distributions that occur before an employee attains age 59½.
Roth IRAs
Section 408A of the Code permits eligible individuals to establish a Roth IRA. Contributions to a Roth IRA are not deductible, but withdrawals of amounts contributed and the earnings thereon that meet certain requirements are not subject to federal income tax. In general, Roth IRAs are subject to limitations on the amount that may be contributed and the persons who may be eligible to contribute and are subject to certain required distribution rules on the death of the Contract Owner. Unlike a traditional IRA, Roth IRAs are not subject to minimum required distribution rules during the Contract Owner’s lifetime. Generally, however, the amount remaining in a Roth IRA must be distributed by the end of the fifth year after the death of the Contract Owner/Annuitant or distributed over the life expectancy of the Designated Beneficiary. The owner of a traditional IRA may convert a traditional IRA into a Roth IRA under certain circumstances. The conversion of a traditional IRA to a Roth IRA will subject the amount of the converted traditional IRA to federal income tax. Anyone considering the purchase of a Qualified Contract as a Roth IRA or a “conversion” Roth IRA should consult with a qualified tax advisor.
In accordance with recent changes in laws and regulations, at the time of either a full or partial conversion from a Traditional IRA annuity to a Roth IRA annuity, the determination of the amount to be reported as income will be based on the annuity contract’s “fair market value”, which will include all front-end loads and other non-recurring charges assessed in the 12 months immediately preceding the conversion, and the actuarial present value of any additional contract benefits.
One IRA Rollover Per Year
Effective January 1, 2015, the IRS will only permit a taxpayer to complete one 60-day indirect IRA-to-IRA rollover per 12 month period. This means that a taxpayer could not make a 60-day indirect IRA-to-IRA rollover if he or she had made such a rollover involving any of the taxpayer's IRAs in the preceding 1-year period. The limit will apply by aggregating all of the individual’s IRAs, including SEP and SIMPLE IRAs as well as traditional and Roth IRAs, effectively treating them as one IRA for purposes of the limit. This rule does not affect the ability of an IRA owner to transfer funds from one IRA trustee directly to another, because such a transfer is not a rollover (but rather a direct transfer) and therefore, is not subject to the one-rollover-per-year limitation of Code Section 408(d)(3)(B). For additional information, see IRS Announcements 2014-15 and 2014-32. Always confirm with your own tax advisor whether this rule impacts your circumstances.
401(k) Plans; Pension and Profit-Sharing Plans
Qualified Plans may be established by an employer for certain eligible employees under Section 401 of the Code. These plans may be 401(k) plans, profit-sharing plans, or other pension or retirement plans. Contributions to these plans are subject to limitations. Rollover to other eligible plans may be available. Please consult your Qualified Plans Summary Plan description for more information.
Section 457(b) Non-Qualified Deferred Compensation Plans
Certain employees of governmental entities or tax-exempt employers may defer compensation through an eligible plan under Code Section 457(b). Contributions to a Contract of an eligible plan are subject to limitations. Subject to plan provisions and a qualifying triggering event, assets in a 457(b) plan established by a governmental entity may be transferred or rolled into an IRA or another Qualified Plan, if the Qualified Plan allows the transfer or rollover. If a rollover to an IRA is completed, the assets become subject to IRA rules, including the 10% penalty on distributions prior to age 59½. Assets from other plans may be rolled into a governmental 457(b) plan if the 457(b) plan allows the rollover and if the investment provider is able to segregate the assets for tax reporting purposes. Consult both the distributing plan and the receiving plan prior to making this election. Assets in a 457(b) plan set up by a tax exempt employer may not be rolled to a different type of Qualified Plan or IRA at any time.
We are the legal owner of the shares of the Portfolios held by the Subaccounts. We may vote on any matter voted on at shareholders’ meetings of the Funds. However, our current interpretation of applicable law requires us to vote the number of shares attributable to your Variable Account Value (your “voting interest”) in accordance with your directions.
We will pass proxy materials on to you so that you have an opportunity to give us voting instructions for your voting interest. You may provide your instructions by proxy or in person at the shareholders’ meeting. If there are shares of a Portfolio held by a Subaccount for which we do not receive timely voting instructions, we will vote those shares in the same proportion as all other shares
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of that Portfolio held by that Subaccount for which we have received timely voting instructions. If we do not receive any voting instructions for the shares in a Separate Account, we will vote the shares in that Separate Account in the same proportion as the total votes for all of our separate accounts for which we’ve received timely instructions. If we hold shares of a Portfolio in our General Account, we will vote such shares in the same proportion as the total votes cast for all of our separate accounts, including Separate Account A. We will vote shares of any Portfolio held by our non-insurance affiliates in the same proportion as the total votes for all separate accounts of ours and our insurance affiliates. As a result of proportional voting, the votes cast by a small number of Contract Owners may determine the outcome of a vote.
We may elect, in the future, to vote shares of the Portfolios held in Separate Account A in our own right if we are permitted to do so through a change in applicable federal securities laws or regulations, or in their interpretation.
The number of Portfolio shares that form the basis for your voting interest is determined as of the record date set by the Board of Trustees of the Fund. It is equal to:
· your Contract Value allocated to the Subaccount corresponding to that Portfolio, divided by
· the net asset value per share of that Portfolio.
Fractional votes will be counted. We reserve the right, if required or permitted by a change in federal regulations or their interpretation, to amend how we calculate your voting interest.
After your Annuity Date, if you have selected a variable annuity, the voting rights under your Contract will continue during the payout period of your annuity, but the number of shares that form the basis for your voting interest, as described above, will decrease throughout the payout period.
Contract Owner(s)
Transfer of Contract ownership may involve federal income tax and/or gift tax consequences; you should consult a qualified tax advisor before effecting such a transfer. A change to or from joint Contract ownership is considered a transfer of ownership. If your Contract is Non-Qualified, you may change Contract ownership at any time prior to your Annuity Date. You may name a different Owner or add or remove a Joint Owner. A Contract cannot name more than two Contract Owners at any time. Any newly-named Contract Owners must be under the age of 86 at the time of change or addition. Additionally, further age limitations may apply if the Contract was issued with an optional death benefit rider. The Contract Owner(s) may make all decisions regarding the Contract, including making allocation decisions and exercising voting rights. Transactions under a Contract with Joint Owners require approval from both Owners. Contract ownership changes may change the Return of Purchase Payments Death Benefit calculations. See DEATH BENEFITS AND OPTIONAL DEATH BENEFIT RIDERS - Death Benefits. In addition, Contract ownership changes may terminate certain living benefit riders. See the Termination subsection for a particular living benefit rider in the LIVING BENEFIT RIDERS section. Work with your financial professional prior to making any ownership changes.
If your Contract is Qualified under Code Sections 401 or 457(b), the Qualified Plan must be the sole Owner of the Contract and the ownership cannot be changed unless and until a triggering event has been met under the terms of the Qualified Plan. Upon such event, the ownership can only be changed to the Annuitant. If your Contract is Qualified under Code Section 408, you must be the sole Owner of the Contract and no changes can be made.
Annuitant and Contingent or Joint Annuitant
See ADDITIONAL INFORMATION – State Considerations for Contracts issued in California.
Once your Contract is issued, your sole Annuitant or Joint Annuitants cannot be changed. For certain Contracts, you may only add a Joint Annuitant on the Annuity Date. Certain changes may be permitted in connection with Contingent Annuitants. See ANNUITIZATION – Selecting Your Annuitant. There may be limited exceptions for certain Qualified Contracts.
Beneficiaries
See ADDITIONAL INFORMATION – State Considerations for Contracts issued in California.
Your Beneficiary is the person(s) or entity who may receive death benefit proceeds under your Contract before the Annuity Date or any remaining annuity payments after the Annuity Date if any Owner (or Annuitant in the case of a Non-Natural Owner) dies. See the DEATH BENEFITS AND OPTIONAL DEATH BENEFIT RIDERS section for additional information regarding death benefit payouts. You may change or remove your Beneficiary or add Beneficiaries at any time prior to the death of any Owner (or Annuitant in the case of a Non-Natural Owner), as applicable. Any change or addition will generally take effect only when we receive all necessary documents, In Proper Form, and we record the change or addition. Any change or addition will not affect any payment made or any other action taken by us before the change or addition was received and recorded. Under our administrative procedures, a signature guarantee and/or other verification of identity or authenticity may be required when processing a claim payable to a Beneficiary.
Spousal consent may be required to change an IRA Beneficiary. If you are considering removing a spouse as a Beneficiary, it is recommended that you consult your legal or tax advisor regarding any applicable state or federal laws prior to requesting the change.
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Qualified Contracts may have additional restrictions on naming and changing Beneficiaries. If your Contract was issued in connection with a Qualified Plan subject to Title I of ERISA, contact your Plan Administrator for details. We require that Contracts issued under Code Sections 401 and 457(b) name the Plan as Beneficiary. If the Plan is unable to set up a trust account for Beneficiary payouts, we will pay the designated Plan Beneficiary under certain conditions. If you leave no surviving Beneficiary or Contingent Beneficiary, your estate will receive any death benefit proceeds under your Contract.
If, in the judgment of our management, continued investment by Separate Account A in one or more of the Portfolios becomes unsuitable or unavailable, we may seek to alter the Variable Investment Options available under the Contracts. We do not expect that a Portfolio will become unsuitable, but unsuitability issues could arise due to changes in investment policies, market conditions, tax laws, or due to marketing or other reasons.
Alterations of Variable Investment Options may take differing forms. We reserve the right to substitute shares of any Portfolio that were already purchased under any Contract (or shares that were to be purchased in the future under a Contract) with shares of another Portfolio, shares of another investment company or series of another investment company, or another investment vehicle. Required approvals of the SEC and applicable state insurance regulators will be obtained before any such substitutions are effected, and you will be notified of any planned substitution.
We may add new Subaccounts to Separate Account A and any new Subaccounts may invest in Portfolios of a Fund or in other investment vehicles. Availability of any new Subaccounts to existing Contract Owners will be determined at our discretion. We will notify you, and will comply with the filing or other procedures established by applicable state insurance regulators, to the extent required by applicable law. We also reserve the right, after receiving any required regulatory approvals, to do any of the following:
· cease offering any Subaccount;
· add or change designated investment companies or their portfolios, or other investment vehicles;
· add, delete or make substitutions for the securities and other assets that are held or purchased by the Separate Account or any Variable Account;
· permit conversion or exchanges between portfolios and/or classes of contracts based on the Owners’ requests;
· add, remove or combine Variable Accounts;
· combine the assets of any Variable Account with any other of our separate accounts or of any of our affiliates;
· register or deregister Separate Account A or any Variable Account under the 1940 Act;
· operate any Variable Account as a managed investment company under the 1940 Act, or any other form permitted by law;
· run any Variable Account under the direction of a committee, board, or other group;
· restrict or eliminate any voting rights of Owners with respect to any Variable Account or other persons who have voting rights as to any Variable Account;
· make any changes required by the 1940 Act or other federal securities laws;
· make any changes necessary to maintain the status of the Contracts as annuities under the Code;
· make other changes required under federal or state law relating to annuities;
· suspend or discontinue sale of the Contracts; and
· comply with applicable law.
Inquiries and Submitting Forms and Requests
You may reach our service representatives at (800) 722-4448 between the hours of 6:00 a.m. and 5:00 p.m., Pacific time on any Business Day. Financial professionals may call us at (800) 722-2333.
Please send your forms and written requests or questions to our Service Center:
Pacific Life Insurance Company
P.O. Box 2378
If you are submitting a Purchase Payment or other payment by mail, please send it, along with your application if you are submitting one, to our Service Center at the following address:
Pacific Life Insurance Company
P.O. Box 2290
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If you are using an overnight delivery service to send payments, please send them to our Service Center at the following address:
Pacific Life Insurance Company
6750 Mercy Road, RSD
The effective date of certain notices or of instructions is determined by the date and time on which we receive the notice or instructions In Proper Form. In those instances when we receive electronic transmission of the information on the application from your financial professional’s broker-dealer firm and our administrative procedures with your broker-dealer so provide, we consider the application to be received on the Business Day we receive the transmission. In those instances when information regarding your Purchase Payment is electronically transmitted to us by the broker-dealer, we will consider the Purchase Payment to be received by us on the Business Day we receive the transmission of the information. Please call us if you or your financial professional have any questions regarding which address you should use.
We reserve the right to process any Purchase Payment received at an incorrect address when it is received at either the address indicated in your Contract specification pages or the appropriate address indicated in the Prospectus.
Purchase Payments after your initial Purchase Payment, transfer requests, and withdrawal requests we receive before the close of the New York Stock Exchange, which usually closes at 4:00 p.m. Eastern time, will be effective at the end of the same Business Day that we receive them In Proper Form unless the transaction or event is scheduled to occur on another Business Day. Generally, whenever you submit any other form, notice or request, your instructions will be effective on the next Business Day after we receive them In Proper Form unless the transaction or event is scheduled to occur on another Business Day. We may also require, among other things, a signature guarantee or other verification of authenticity. We do not generally require a signature guarantee unless it appears that your signature may have changed over time or the signature does not appear to be yours; or an executed application or confirmation of application, as applicable, In Proper Form is not received by us; or, to protect you or us. Requests regarding death benefit proceeds must be accompanied by both proof of death and instructions regarding payment In Proper Form. You should call your financial professional or us if you have questions regarding the required form of a request.
Telephone and Electronic Transactions
You are automatically entitled to make certain transactions by telephone or, to the extent available, electronically. You may also authorize other people to make certain transaction requests by telephone or, to the extent available, electronically by so indicating on the application or by sending us instructions in writing in a form acceptable to us. We cannot guarantee that you or any other person you authorize will always be able to reach us to complete a telephone or electronic transaction; for example, all telephone lines may be busy or access to our website may be unavailable during certain periods, such as periods of substantial market fluctuations or other drastic economic or market change, or telephones or the Internet may be out of service or unavailable during severe weather conditions or other emergencies. Under these circumstances, you should submit your request in writing (or other form acceptable to us). Transaction instructions we receive by telephone or electronically before the close of the New York Stock Exchange, which usually closes at 4:00 p.m. Eastern time, on any Business Day will usually be effective at the end of that day, and we will provide you confirmation of each telephone or electronic transaction.
We have established procedures reasonably designed to confirm that instructions communicated by telephone or electronically are genuine. These procedures may require any person requesting a telephone or electronic transaction to provide certain personal identification upon our request. We may also record all or part of any telephone conversation with respect to transaction instructions. We reserve the right to deny any transaction request made by telephone or electronically. You are authorizing us to accept and to act upon instructions received by telephone or electronically with respect to your Contract, and you agree that, so long as we comply with our procedures, neither we, any of our affiliates, nor any Fund, or any of their directors, trustees, officers, employees or agents will be liable for any loss, liability, cost or expense (including attorneys’ fees) in connection with requests that we believe to be genuine. This policy means that so long as we comply with our procedures, you will bear the risk of loss arising out of the telephone or electronic transaction privileges of your Contract. If a Contract has Joint Owners, each Owner may individually make telephone and/or electronic transaction requests.
The authorization to make transactions by telephone or, to the extent available, electronically, will terminate when we receive notification of your death, and telephone or electronic transactions will no longer be accepted.
Electronic Information Consent
Subject to availability, you may authorize us to provide prospectuses, prospectus supplements, reports, annual statements, statements and immediate confirmations, tax forms, proxy solicitations, privacy notice and other notices and documentation in electronic format when available instead of receiving paper copies of these documents by U.S. mail. You may enroll in this service by so indicating on the application, via our Internet website, or by sending us instructions in writing in a form acceptable to us to receive such documents electronically. Not all contract documentation and notifications may be currently available in electronic format. You will continue to receive paper copies of any documents and notifications not available in electronic format by U.S. mail. For jointly owned contracts, both owners are consenting to receive information electronically. Documents will be available on our Internet website. As documents become available, we will notify you of this by sending you an e-mail message that will include instructions on how to retrieve the
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document. You must have ready access to a computer with Internet access, an active e-mail account to receive this information electronically, and the ability to read and retain it. You may access and print all documents provided through this service.
If you plan on enrolling in this service, or are currently enrolled, please note that:
· There is no charge for electronic delivery, although your Internet provider may charge for Internet access.
· You should provide a current e-mail address and notify us promptly when your e-mail address changes.
· You should update any e-mail filters that may prevent you from receiving e-mail notifications from us.
· You may request a paper copy of the information at any time for no charge, even though you consented to electronic delivery, or if you decide to revoke your consent.
· For jointly owned contracts, all information will be provided to the e-mail address that is provided to us.
· Electronic delivery will be cancelled if e-mails are returned undeliverable.
· This consent will remain in effect until you revoke it.
If you are currently enrolled in this service, please call (800) 722-4448 if you would like to revoke your consent, wish to receive a paper copy of the information above, or need to update your e-mail address. You may opt out of electronic delivery at any time.
Timing of Payments and Transactions
For withdrawals, including exchanges under Code Section 1035 and other Qualified transfers, from the Variable Investment Options or for death benefit payments attributable to your Variable Account Value, we will normally send the proceeds within 7 calendar days after your request is effective or after the Notice Date, as the case may be. We will normally effect periodic annuity payments on the day that corresponds to the Annuity Date and will make payment on the following Business Day. Payments or transfers may be suspended for a longer period under certain extraordinary circumstances. These include: a closing of the New York Stock Exchange other than on a regular holiday or weekend; a trading restriction imposed by the SEC; or an emergency declared by the SEC. Payments (including fixed annuity payments), withdrawals or transfers from the General Account (including any fixed-rate General Account Investment Option) may be delayed for up to six months after the request is effective. See THE GENERAL ACCOUNT for more details.
Confirmations, Statements and Other Reports to Contract Owners
Confirmations will be sent out for unscheduled Purchase Payments and transfers, unscheduled partial withdrawals, a full withdrawal and living benefit rider Automatic or Owner Elected Resets. Periodically, we will send you a statement that provides certain information pertinent to your Contract. These statements disclose Contract Value, Subaccount values, any fixed option values, fees and charges applied to your Contract Value, transactions made and specific Contract data that apply to your Contract. Confirmations of your transactions under the pre-authorized investment program, dollar cost averaging, portfolio rebalancing, and pre-authorized withdrawal options will appear on your quarterly account statements. Your fourth-quarter statement will contain annual information about your Contract Value and transactions. You may also access these statements online.
If you suspect an error on a confirmation or quarterly statement, you must notify us in writing as soon as possible, preferably within 30 calendar days from receiving the transaction confirmation or if the transaction is first confirmed on the quarterly statement, within 30 calendar days of receiving the quarterly statement.
You will also be sent an annual and semi-annual report (shareholder reports) for the Funds and a list of the securities held in each Portfolio of the Funds, as required by the 1940 Act; or more frequently if required by law.
Contract Owner Mailings. To help reduce expenses, environmental waste and the volume of mail you receive, only one copy of Contract Owner documents (such as the prospectus, supplements, announcements, and each annual and semi-annual report) may be mailed to Contract Owners who share the same household address (Householding). If you are already participating, you may opt out by contacting us. Please allow 30 calendar days for regular delivery to resume. You may also elect to participate in Householding by writing or calling us. The current documents are available on our website any time or an individual copy of any of these documents may be requested – see the last page of this Prospectus for more information.
Cybersecurity and Business Continuity Risks
Our business is highly dependent upon the effective operation of our computer systems and those of our business partners. As a result, our business is potentially susceptible to operational and information security risks associated with the technologies, processes and practices designed to protect networks, systems, computers, programs and data from attack, damage or unauthorized access. These risks include, among other things, the theft, loss, misuse, corruption and destruction of data maintained online or digitally, denial of service on websites and other operational disruption, and unauthorized release of confidential customer information. Cyber-attacks affecting us, any third-party administrator, the underlying Funds, intermediaries, and other affiliated or third-party service providers may adversely affect us and your Contract Value. For instance, cyber-attacks may interfere with contract transaction processing, including the processing of orders from our website or with the underlying Funds; impact our ability to calculate Accumulated Unit Values, Subaccount Unit Values or an underlying Fund to calculate a net asset value; cause the release and possible destruction of
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confidential customer or business information; impede order processing; subject us and/or our service providers and intermediaries to regulatory fines and financial losses; and/or cause reputational damage. Cybersecurity risks may also impact the issuers of securities in which the underlying Funds invest, which may cause the Funds underlying your Contract to lose value. The constant change in technologies and increased sophistication and activities of hackers and others, continue to pose new and significant cybersecurity threats. While measures have been developed that are designed to reduce cybersecurity risks, there can be no guarantee or assurance that we, the underlying Funds, or our service providers will not suffer losses affecting your Contract due to cyber-attacks or information security breaches in the future.
We are also exposed to risks related to natural and man-made disasters or other events, including (but not limited to) earthquakes, fires, floods, storms, epidemics and pandemics (such as COVID-19), terrorist acts, civil unrest, malicious acts and/or other events that could adversely affect our ability to conduct business. The risks from such events are common to all insurers. To mitigate such risks, we have business continuity plans in place that include remote workforces, remote system and telecommunication accessibility, and other plans to ensure availability of critical resources and business continuity during an event. Such events can also have an adverse impact on financial markets, U.S. and global economies, service providers, and Fund performance for the portfolios available through your Contract. There can be no assurance that we, the Funds, or our service providers will avoid such adverse impacts due to such events and some events may be beyond control and cannot be fully mitigated or foreseen.
PSD, a broker-dealer and our subsidiary, pays various forms of sales compensation to broker-dealers (including other affiliates) that solicit applications for the Contracts. PSD also may reimburse other expenses associated with the promotion and solicitation of applications for the Contracts.
We offer the Contracts for sale through broker-dealers that have entered into selling agreements with PSD. Broker-dealers sell the Contracts through their financial professionals. PSD pays compensation to broker-dealers for the promotion and sale of the Contracts. The individual financial professional who sells you a Contract typically will receive a portion of the compensation, under the financial professional’s own arrangement with his or her broker-dealer. Broker-dealers may generally receive aggregate commissions of up to 8.00% of your aggregate Purchase Payments. Under certain circumstances where PSD pays lower initial commissions, certain broker dealers that solicit applications for Contracts may be paid an ongoing persistency trail commission (sometimes called a residual) which will take into account, among other things, the Account Value and the length of time Purchase Payments have been held under a Contract. A trail commission is not anticipated to exceed 1.50%, on an annual basis, of the Account Value considered in connection with the trail commission.
We may also provide compensation to broker-dealers for providing ongoing service in relation to Contracts that have already been purchased.
Additional Compensation and Revenue Sharing
To the extent permitted by SEC and FINRA rules and other applicable laws and regulations, selling broker-dealers may receive additional payments in the form of cash, other special compensation or reimbursement of expenses, sometimes called “revenue sharing”. These additional compensation or reimbursement arrangements may include, for example, payments in connection with the firm’s “due diligence” examination of the contracts, payments for providing conferences or seminars, sales or training programs for invited financial professionals and other employees, payments for travel expenses, including lodging, incurred by financial professionals and other employees for such seminars or training programs, seminars for the public, advertising and sales campaigns regarding the Contracts, and payments to assist a firm in connection with its administrative systems, operations and marketing expenses and/or other events or activities sponsored by the firms. Subject to applicable FINRA rules and other applicable laws and regulations, PSD and its affiliates may contribute to, as well as sponsor, various educational programs or promotions in which participating firms and their salespersons may receive prizes such as merchandise, cash, or other awards. Such additional compensation may give us greater access to financial professionals of the broker-dealers that receive such compensation or may otherwise influence the way that a broker-dealer and financial professional market the Contracts.
These arrangements may not be applicable to all firms, and the terms of such arrangements may differ between firms. We provide additional information on special compensation or reimbursement arrangements involving selling firms and other financial institutions in the Statement of Additional Information, which is available upon request. Any such compensation will not result in any additional direct charge to you by us.
The compensation and other benefits provided by PSD or its affiliates may be more or less than the overall compensation on similar or other products. This may influence your financial professional or broker-dealer to present this Contract over other investment vehicles available in the marketplace. You may ask your financial professional about these differing and divergent interests, how he/she is personally compensated and how his/her broker-dealer is compensated for soliciting applications for the Contract.
We have entered into services agreements with certain Funds, or Fund affiliates, which pay us for administrative and other services, including, but not limited to, certain communications and support services. The fees are based on an annual percentage of average daily net assets of certain Fund portfolios purchased by us at Contract Owner’s instructions. Currently, the fees received do not exceed an annual percentage of 0.25% and each Fund (or Fund affiliate) may not pay the same annual percentage (some may pay significantly
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less). Because we receive such fees, we may be subject to competing interests in making these Funds available as Investment Options under the Contracts.
American Funds Insurance Series pays us for each American Fund Insurance Series portfolio (Class 4 and Class P2) held by our separate accounts. BlackRock Distributors, Inc. pays us for each BlackRock Variable Series Funds, Inc. portfolio (Class III) held by our separate accounts. Fidelity Distributors Corporation pays us for each Fidelity® Variable Insurance Products Fund portfolio (Service Class and Service Class 2) held by our separate accounts. First Trust Variable Insurance Trust and First Trust Advisors L.P. pay us for each First Trust Variable Insurance Trust portfolio (Class I) held by our separate accounts. Franklin Templeton Services, LLC pays us for each Franklin Templeton Variable Insurance Products Trust portfolio (Class 4) held by our separate accounts. Invesco Advisers, Inc. and its affiliates pay us for each AIM Variable Insurance Funds (Invesco Variable Insurance Funds) portfolio (Series II) held by our separate accounts. Ivy Distributors, Inc. pays us for each Ivy Variable Insurance Portfolio (Class II) held by our separate accounts. Janus Capital Management LLC, pays us for each Janus Aspen Series portfolio (Service Shares) held by our separate accounts. Massachusetts Financial Services Company pays us for each MFS Variable Insurance Trust portfolio (Service Class) held by our separate accounts. State Street Global Advisors Funds Distributors, LLC, pays us for each State Street Variable Insurance Series Funds, Inc. portfolio (Class 3) held by our separate accounts.
Replacement of Life Insurance or Annuities
The term “replacement” has a special meaning in the life insurance industry and is described more fully below. Before you make your purchase decision, we want you to understand how a replacement may impact your existing plan of insurance.
A policy “replacement” occurs when a new policy or contract is purchased and, in connection with the sale, an existing policy or contract is surrendered, lapsed, forfeited, assigned to the replacing insurer, otherwise terminated, or used in a financed purchase. A “financed purchase” occurs when the purchase of a new life insurance policy or annuity contract involves the use of funds obtained from the values of an existing life insurance policy or annuity contract through withdrawal, surrender or loan.
There are circumstances in which replacing your existing life insurance policy or annuity contract can benefit you. As a general rule, however, replacement is not in your best interest. Accordingly, you should make a careful comparison of the costs and benefits of your existing policy or contract and the proposed policy or contract to determine whether replacement is in your best interest.
Certain Contract features described in this Prospectus may vary or may not be available in your state. The state in which your Contract is issued governs whether or not certain features, Riders, charges or fees are available or will vary under your Contract. These variations are reflected in your Contract and in Riders or Endorsements to your Contract. See your financial professional or contact us for specific information that may be applicable to your state.
Arizona. For Owners 65 years of age or older on the application date, the Free Look period is 30 calendar days.
Florida. The Free Look period is 21 calendar days.
Idaho, North Dakota, Rhode Island, and Texas. The Free Look period is 20 calendar days.
California. Variations for California are set forth below:
TERMS USED IN THIS PROSPECTUS
Annuitant – A person on whose life annuity payments may be determined. An Annuitant’s life will also be used to determine death benefits and to determine the Annuity Date. A Contract may name a single (“sole”) Annuitant or two (“Joint”) Annuitants. If you name Joint Annuitants, “the Annuitant” means the sole surviving Annuitant, unless otherwise stated. If the Contract is a Non-Qualified Contract, you cannot change the Annuitant. You may add a Joint Annuitant only on the Annuity Date.
Beneficiary – A person who may have a right to receive any death benefit proceeds before the Annuity Date or any remaining annuity payments after the Annuity Date, if any owner or Annuitant dies.
Contingent Annuitant – A Contingent Annuitant is not available for California issued Contracts. Any references to a Contingent Annuitant do not apply to California issued Contracts.
Contract Owner, Owner, Policyholder, you, or your – Generally, a person who purchases a Contract and makes the Investments. A Contract Owner has all rights in the Contract, including the right to make withdrawals, designate and change beneficiaries, transfer amounts among Investment Options, and designate an Annuity Option. If your Contract names Joint Owners, both Joint Owners are Contract Owners and share all such rights.
OVERVIEW
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The Death Benefit
Generally, the Contract provides a death payout upon the first death of an Owner or the death of the sole surviving Annuitant, whichever occurs first, during the accumulation phase. Death benefit proceeds are payable when we receive proof of death and payment instructions. To whom we pay a death benefit, and how we calculate the death benefit amount depends on who dies first and the type of Contract you own. For more information about the death benefit see DEATH BENEFITS AND OPTIONAL DEATH BENEFIT RIDERS - Death Benefits.
PURCHASING YOUR CONTRACT
The maximum age of a Contract Owner/Annuitant, including Joint Owners and Joint Annuitants, for which a Contract will be issued is 85. The Contract Owner’s age is calculated as of his or her last birthday. If any Contract Owner or Annuitant named in the application for a Contract dies and we are notified of the death before we issue the Contract, then we will return the amount we received. If we issue the Contract and are subsequently notified after issuance that the death occurred prior to issue, then the application for the Contract and/or any Contract issued will be deemed cancelled and a refund will be issued. The refund amount will be the Contract Value based upon the next determined Accumulated Unit Value (AUV) after we receive proof of death of the Contract Owner or Annuitant, plus a refund of any amount used to pay premium taxes and/or any other taxes. Any refunded assets may be subject to probate.
CHARGES, FEES AND DEDUCTIONS
Withdrawal Charge
No front-end sales charge is imposed on any Purchase Payment which means the entire amount of your Purchase Payment is allocated to the Investment Options you selected. Your Purchase Payments may, however, be subject to a withdrawal charge. This charge may apply to amounts you withdraw under your Contract prior to the Annuity Date, depending on the length of time each Purchase Payment has been invested and on the amount you withdraw. This amount is deducted proportionately among all Investment Options from which the withdrawal occurs. See the Choosing Your Annuity Option – Annuity Options section for withdrawal charges that may apply to redemptions after the Annuity Date. No withdrawal charge is imposed on:
· the free withdrawal amount (see WITHDRAWALS – Withdrawals Free of a Withdrawal Charge),
· the maximum annual withdrawal amount allowed under a living benefit rider (See LIVING BENEFIT RIDERS),
· death benefit proceeds, except as provided under the DEATH BENEFITS AND OPTIONAL DEATH BENEFIT RIDERS – Non- Natural Owner section in this State Considerations section for certain Non-Natural Owners,
· amounts converted after the 1st Contract Anniversary to an Annuity Option (see ANNUITIZATION – Choosing Your Annuity Option), unless guaranteed variable annuity payments under Annuity Option 2 or 4 are subsequently redeemed (see ANNUITIZATION – Choosing Your Annuity Option), or
· withdrawals by Owners to meet the minimum distribution rules for Qualified Contracts as they apply to amounts held under the Contract.
Transfers of all or part of your Account Value from one Investment Option to another are not considered a withdrawal of an amount from your Contract, so no withdrawal charge is imposed at the time of transfer. See HOW YOUR INVESTMENTS ARE ALLOCATED – Transfers and Market-timing Restrictions and THE GENERAL ACCOUNT.
ANNUITIZATION
Selecting Your Annuitant
When you submit your Contract application, you must choose a sole Annuitant or Joint Annuitants. You must make your choices based on the following:
· If you are buying a Non-Qualified Contract, you may choose yourself as the Annuitant, another person as the Annuitant, or you may choose Joint Annuitants. If you do not choose Joint Annuitants when your Contract is issued, you may only add a Joint Annuitant on the Annuity Date.
· If you are buying a Qualified Contract, you must be the sole Annuitant. You may only add a Joint Annuitant on the Annuity Date.
No Annuitant (sole or Joint) may be named upon or after reaching his or her 86th birthday. We reserve the right to require proof of age or survival of the Annuitant(s).
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DEATH BENEFITS AND OPTIONAL DEATH BENEFIT RIDERS
Death Benefits
Death benefit proceeds may be payable before the Annuity Date upon the death of the first Annuitant or of any Contract Owner while the Contract is in force. Any death benefit payable will be calculated on the “Notice Date”, which is the day on which we receive proof of death and instructions regarding payment of death benefit proceeds. If a Contract has multiple Beneficiaries, death benefit proceeds will be calculated when we first receive proof of death and instructions from any Beneficiary. The death benefit proceeds still remaining to be paid to other Beneficiaries will fluctuate with the performance of the underlying Investment Options. See the Death of First Annuitant and Death of Owner subsection below for payout amount information.
Death Benefit Proceeds
Death benefit proceeds will be payable on the Notice Date. If proceeds are used to purchase an Annuity Option from us, such proceeds will be reduced by any charge for premium taxes and/or other taxes. The death benefit proceeds may be payable in a single sum, as an Annuity Option available under the Contract, towards the purchase of any other Annuity Option we then offer, or in any other manner permitted by the IRS and approved by us. The sole surviving Annuitant’s spouse may continue the Contract (see Death Benefits – Spousal Continuation). In addition, there may be legal requirements that limit the recipient’s Annuity Options and the timing of any payments. A recipient should consult a qualified tax advisor before making a death benefit election.
The death benefit proceeds will be paid to the first among the following who is (1) living; or (2) an entity or corporation entitled to receive the death benefit proceeds, in the following order:
· Owner,
· Joint Owner,
· Beneficiary, or
· Contingent Beneficiary.
If none are living (or if there is no entity or corporation entitled to receive the death benefit proceeds), the proceeds will be payable to the Owner’s Estate.
Death of First Annuitant
If the first Annuitant dies before the Annuity Date, the amount of the death benefit will be equal to the Death Benefit Amount as of the Notice Date and will be paid in accordance with the Death Benefit Proceeds section.
Death of Owner
If the Owner (who is not also an Annuitant) dies before the Annuity Date and prior to the death of an Annuitant, the death benefit amount paid will be the Contract Value as of the Notice Date and will be paid in accordance with the Death Benefit Proceeds section above and in accordance with the federal income tax distribution at death rules discussed in the FEDERAL TAX ISSUES section.
Spousal Continuation
Generally, a sole designated recipient who is the spouse of the deceased Annuitant or Owner may elect to become the Owner (and sole Annuitant if the deceased Owner had been the Annuitant) rather than receive the proceeds in a lump sum and continue the Contract until the earliest of the spouse’s death, or the Annuity Date. The spousal continuation election must be made by the fifth anniversary of the death of the Contract Owner for Non-Qualified Contracts, or by December 31 of the calendar year in which the fifth anniversary of the Contract Owner’s death falls for Qualified Contracts. On the Notice Date, if the surviving spouse is deemed to have continued the Contract, we will set the Contract Value equal to the death benefit proceeds that would have been payable to the spouse as the deemed Beneficiary/designated recipient of the death benefit proceeds.
This “Add-In Amount” is the difference between the Contract Value and the death benefit proceeds that would have been payable. The Add-In Amount will be added to the Contract Value on the Notice Date. There will not be an adjustment to the Contract Value if the Contract Value is equal to or greater than the death benefit proceeds as of the Notice Date. The Add-In Amount will be allocated among Investment Options in accordance with the current allocation instructions for the Contract and may be, under certain circumstances, considered earnings. The Add-In Amount is not treated as a new Purchase Payment.
A Joint Owner who is the designated recipient, but not the Owner’s spouse, may not continue the Contract. Under IRS Guidelines, once a surviving spouse continues the Contract, the Contract may not be continued again in the event the surviving spouse remarries. Please refer to the living benefit rider attached to your Contract to determine how any guaranteed amounts may be affected when a surviving spouse continues the Contract.
Example: On the Notice Date, the Annuitant’s surviving spouse elects to continue the Contract. On that date, the death benefit proceeds were $100,000 and the Contract Value was $85,000. Since the surviving spouse elected to continue the Contract in lieu of receiving the death benefit proceeds, we will increase the Contract Value by an Add-In Amount of $15,000 ($100,000 - $85,000 = $15,000). If the Contract Value on the Notice Date was $100,000 or higher, then nothing would be added to the Contract Value.
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The continuing spouse is subject to the same fees, charges and expenses applicable to the deceased Owner of the Contract.
Non-Natural Owner
If you are a Non-Natural Owner of a Contract other than a Contract issued under a Qualified Plan as defined in Section 401 of the Code, the Annuitant (either Annuitant if there are Joint Annuitants) will be treated as the Owner of the Contract for purposes of the Non-Qualified Contract Distribution Rules. If there are Joint Annuitants, the death benefit proceeds will be payable on proof of death of the first annuitant. The Death Benefit Amount will apply if the Non-Natural Owner elects to maintain the Contract and reinvest the Contract Value into the contract in the same amount as immediately prior to the distribution; or (b) the Death Benefit Amount less any Annual Fee, withdrawal charge and charges for premium taxes and/or other taxes, if the Non-Natural Owner elects a cash distribution and will be paid in accordance with the Death Benefits Proceeds section and in accordance with the federal income tax distribution at death rules discussed in the FEDERAL TAX ISSUES section.
Non-Qualified Contract Distribution Rules
The Contract is intended to comply with all applicable provisions of Code Section 72(s) and any successor provision, as deemed necessary by us to qualify the Contract as an annuity contract for federal income tax purposes. If an Owner of a Non-Qualified Contract dies before the Annuity Date, distribution of the death benefit proceeds must begin within 1 year after the Owner’s death or complete distribution within 5 years after the Owner’s death. In order to satisfy this requirement, the designated recipient must receive a final lump sum payment by the 5th anniversary of the Contract Owner’s death, or elect to receive an annuity for life or over a period that does not exceed the life expectancy of the designated recipient with annuity payments that start within 1 year after the Owner’s death or, if permitted by the IRS, elect to receive a systematic distribution over a period not exceeding the beneficiary’s life expectancy using a method that would be acceptable for purposes of calculating the minimum distribution required under section 401(a)(9) of the Code. If an election to receive an annuity is not made within 60 calendar days of our receipt of proof of the Owner’s death or, if earlier, 60 calendar days (or shorter period as we permit) prior to the 1st anniversary of the Owner’s death, the option to receive annuity payments is no longer available. If a Non-Qualified Contract has Joint Owners, this requirement applies to the first Contract Owner to die.
The Owner may designate that the Beneficiary will receive death benefit proceeds in a lump sum, or through annuity payments for Life, Life with Period Certain, Period Certain or a Scheduled Payout Option. Any Life with Period Certain or Period Certain payout period is 5 through 30 years, but cannot exceed the life expectancy of the Beneficiary. The Owner must designate the payment method in writing in a form acceptable to us. The Owner may revoke the designation only in writing and only in a form acceptable to us. Once the Owner dies, the Beneficiary cannot change or revoke the Owner’s instructions regarding the payment of death benefit proceeds.
Qualified Contract Distribution Rules
Under Treasury regulations and our administrative procedures, if the Contract is owned under a Qualified Plan as defined in Sections 401, 457(b), 408, or 408A of the Code distributions to the Beneficiary must satisfy the Required Minimum Distribution (RMD) rules of Code Section 401(a)(9). For Owner/Annuitants who die after December 31, 2019, the RMD rules for Beneficiaries who inherit an account or IRA are different depending on whether the Beneficiary is an “Eligible Designated Beneficiary” (EDB) or not. An EDB includes a surviving spouse, a disabled individual, a chronically ill individual, a minor child, or an individual who is not more than 10 years younger than the Owner/Annuitant. Certain trusts created for the exclusive benefit of disabled or chronically ill Beneficiaries are included. These EDBs may take their distributions over the Beneficiary's life expectancy and those distributions must commence by December 31st of the year following the death of the Owner/Annuitant. However, minor children must still take remaining distributions within 10 years of reaching age 18. Additionally, a surviving spouse Beneficiary may delay commencement of distributions until the later of the end of the year that the Owner/Annuitant would have attained age 72, or when the surviving spouse turns 72.
Designated Beneficiaries, who are not an EDB, must withdraw the entire account by the 10th calendar year following the death of the Owner/Annuitant.
Non-designated Beneficiaries must withdraw the entire account within 5 years of the Owner/Annuitant’s death if distributions have not begun prior to death unless the owner dies after commencing his or her RMD payments. If the Annuitant dies after the commencement of RMDs (except in the case of a Roth IRA when RMDs do not apply) but before the Annuitant’s entire interest in the Contract (other than a Roth IRA) has been distributed, the remaining interest in the Contract must be distributed to the designated recipient at least as rapidly as under the distribution method in effect at the time of the Annuitant’s death.
If the Owner/Annuitant dies after the commencement of RMDs (except in the case of a Roth IRA when RMDs do not apply) but before the Annuitant’s entire interest in the Contract (other than a Roth IRA) has been distributed, the remaining interest in the Contract must be distributed to the non-designated Beneficiary at least as rapidly as under the distribution method in effect at the time of the Annuitant’s death.
You are responsible for monitoring distributions that must be taken to meet IRS guidelines.
The Owner may designate that the Beneficiary will receive death benefit proceeds in a lump sum, or through annuity payments for a Period Certain of 5 through 9 years. The Owner must designate the payment method in writing in a form acceptable to us. The Owner may revoke the designation only in writing and only in a form acceptable to us. Once the Owner dies, the Beneficiary cannot change or revoke the Owner’s instructions regarding the payment of death benefit proceeds.
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WITHDRAWALS
The Right to Cancel (“Free Look”) section is amended to include the following:
California Applicants Age 60 or Older
For residents of the state of California 60 years of age or older, the Free Look period is a 30-day period beginning on the calendar day you receive your Contract. If you are a California applicant age 60 or older you must elect, at the time you apply for your Contract, to receive a return of either your Purchase Payments or your Contract Value proceeds if you exercise your Right to Cancel and return your Contract to us.
If you elect to receive the return of Purchase Payments option, the following will apply:
· We will allocate all or any portion of any Purchase Payment we receive to any available fixed option if you instruct us to do so. We will allocate all or any portion of any Purchase Payment designated for any Variable Investment Option to the Fidelity® VIP Government Money Market Subaccount until the Free Look Transfer Date. The Free Look Transfer Date is 30 calendar days from the Contract Date. On the Free Look Transfer Date, we will automatically transfer your Fidelity® VIP Government Money Market Subaccount Value according to the instructions on your application, or your most recent instruction, if any. This automatic transfer to the Variable Investment Options according to your initial allocation instruction is excluded from the Transfer limitations. See HOW YOUR PURCHASE PAYMENTS ARE ALLOCATED – Transfers and Market-timing Restrictions.
· If you specifically instruct us to allocate all or any portion of any additional Purchase Payment we receive to any Variable Investment Option other than the Fidelity® VIP Government Money Market Subaccount before the Free Look Transfer Date, you will automatically change your election to the return of your Contract Value proceeds option. This will automatically cancel your election of the “return of Purchase Payments” option for the entire Contract.
· If you request a transfer of all or any portion of your Contract Value from the Fidelity® VIP Government Money Market Subaccount to any other Variable Investment Option before the Free Look Transfer Date, you will automatically change your election to the return of your Contract Value proceeds option. This will automatically cancel your election of the “return of Purchase Payments” option for the entire Contract.
· If you exercise your Right to Cancel, we will send you your Purchase Payments.
If you elect the return of Contract Value proceeds option, the following will apply:
· We will immediately allocate any Purchase Payments we receive to the Investment Options you select on your application or your most recent instructions, if any.
· If you exercise your Right to Cancel, we will send you your Contract Value proceeds described in the Right to Cancel (“Free Look”) section of this prospectus.
· Once you elect this option, it may not be changed.
ADDITIONAL INFORMATION
Annuitant or Joint Annuitant
Once your Contract is issued, your sole Annuitant or Joint Annuitants cannot be changed. You may only add a Joint Annuitant on the Annuity Date. See ANNUITIZATION – Selecting Your Annuitant. There may be limited exceptions for certain Qualified Contracts.
Beneficiaries
Your Beneficiary is the person(s) or entity who may receive death benefit proceeds under your Contract before the Annuity Date or any remaining annuity payments after the Annuity Date if any Owner or Annuitant dies. See the DEATH BENEFITS AND OPTIONAL DEATH BENEFIT RIDERS section for additional information regarding death benefit payouts. You may change or remove your Beneficiary or add Beneficiaries at any time prior to the death of any Owner or Annuitant, as applicable. Any change or addition will generally take effect only when we receive all necessary documents and we record the change or addition. Any change or addition will not affect any payment made or any other action taken by us before the change or addition was received and recorded. Under our administrative procedures, a signature guarantee and/or other verification of identity or authenticity may be required when processing a claim payable to a Beneficiary.
District of Columbia. Free Look – Purchase Payments are returned in the event the Contract is cancelled within the Free Look period.
Florida. For Owners 64 years of age or younger on the application date, the Free Look period is 14 calendar days. For Owners 65 years of age or older on the application date, the Free Look period is 21 calendar days.
North Dakota. The Free Look period is 20 calendar days.
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End of State Considerations subsection.
Pacific Life’s financial statements and the financial statements of Separate Account A are contained in the Statement of Additional Information.
Rule 12h-7 Representation
In reliance on the exemption provided by Rule 12h-7 of the Securities Exchange Act of 1934 (“34 Act”), we do not intend to file periodic reports as required under the 34 Act.
All amounts allocated to a fixed option become part of our General Account. Subject to applicable law, we exercise sole discretion over the investment of General Account assets, and bear the associated investment risk. You will not share in the investment experience of General Account assets. Unlike the Separate Account, the General Account is subject to liabilities arising from any of our other business. Any guarantees provided for under the contract or through living benefit or optional death benefit riders are backed by our financial strength and claims-paying ability. You must look to the strength of the insurance company with regard to such guarantees. Payments (including fixed annuity payments), withdrawals or transfers from the General Account (including any fixed-rate General Account Investment Option) may be delayed for up to six months after the request is effective.
Because of exemptive and exclusionary provisions, interests in the General Account under the Contract are not registered under the Securities Act of 1933, as amended, and the General Account has not been registered as an investment company under the 1940 Act. Any interest you have in a fixed option is not subject to these Acts. This disclosure is, however, subject to certain provisions of federal securities laws relating to the accuracy and completeness of statements made in prospectuses.
Guarantee Terms
When you allocate any portion of your Purchase Payments or Contract Value to any fixed option, we guarantee you an interest rate (a “Guaranteed Interest Rate”) for a specified period of time (a “Guarantee Term”). Guarantee Terms will be offered at our discretion.
Guaranteed Interest Rates for any fixed option may be changed periodically for new allocations. Your allocation will receive the Guaranteed Interest Rate in effect for that fixed option on the effective date of your allocation. All Guaranteed Interest Rates will credit interest daily at a rate that compounds over one year to equal the annual effective rate. The Guaranteed Interest Rate on your fixed option will remain in effect for the Guarantee Term and will never be less than the minimum guaranteed interest rate specified in your Contract.
Withdrawals and Transfers
Prior to the Annuity Date, you may withdraw or transfer amounts from any fixed option to one or more of the other Variable Investment Options.
Amounts transferred or withdrawn from any fixed option may be delayed, as described under ADDITIONAL INFORMATION – Timing of Payments and Transactions. Any amount delayed, so long as it is held under any fixed option, will continue to earn interest at the Guaranteed Interest Rate then in effect until that Guarantee Term has ended, and the minimum guaranteed interest rate specified in your Contract thereafter, unless state law requires a greater rate be paid.
Before your Annuity Date, you can allocate all or some of your Purchase Payments to the DCA Plus Fixed Option. The initial minimum amount that you may allocate to the DCA Plus Fixed Option is $5,000. Currently, we are not enforcing the minimum amount you may allocate to the DCA Plus Fixed Option but we reserve the right to enforce the minimum amount in the future. We will provide at least a 30 calendar day prior notice before we enforce the minimum amount you may allocate to the DCA Plus Fixed Option. You may not transfer any amount to the DCA Plus Fixed Option from any other Investment Option. All Purchase Payments allocated to the DCA Plus Fixed Option will earn interest at the then current Guaranteed Interest Rate declared by us.
The DCA Plus Fixed Option Value on any Business Day is the DCA Plus Fixed Option Value on the prior Business Day, increased by any additions to the DCA Plus Fixed Option on that Business Day as a result of any:
· interest, plus
· Purchase Payments allocated to the DCA Plus Fixed Option, plus
· any additional amounts allocated to the DCA Plus Fixed Option,
and decreased by any deductions from the DCA Plus Fixed Option on that Business Day as a result of any;
· transfers,
· withdrawals, including any applicable withdrawal charges,
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· amounts applied to provide an annuity,
· annual fees, and
· charges for premium taxes and/or other taxes.
The DCA Plus program will automatically terminate at the end of your DCA Plus Guarantee Term, or upon the earliest of:
· the date death benefit proceeds become payable under the Contract,
· the date you transfer the entire amount from the DCA Plus Fixed Option to another Investment Option,
· the date the Contract is terminated, or
· the Annuity Date.
At the end of the DCA Plus program, upon receipt of an additional Purchase Payment that satisfies our minimum allocation requirements, you may request, In Proper Form, a new DCA Plus program.
We reserve the right to change the terms and conditions of the DCA Plus program, but not a DCA Plus program you already have in effect.
Guarantee Terms
Currently, you can choose a Guarantee Term of up to 24 months, depending on what Guarantee Terms we offer. Please contact us for the Guarantee Terms currently available. The Business Day that the first Purchase Payment allocation is made to the DCA Plus Fixed Option will begin your Guarantee Term. Monthly transfers will occur on the same Business Day of each month thereafter to the Variable Investment Options that you selected. The amount transferred each month is equal to your DCA Plus Fixed Option Value on that Business Day divided by the remaining number of monthly transfers in the Guarantee Term.
Example: On May 1, you submit a $10,000 Purchase Payment entirely to the DCA Plus Fixed Option at a then current Guaranteed Interest Rate of 5.00% with a Guarantee Term of 6 months. On June 1, the value of the DCA Plus Fixed Option is $10,041.52. On June 1, a transfer equal to $1,673.59 ($10,041.52 / 6) will be made according to your DCA Plus transfer instructions. Your remaining DCA Plus Fixed Option Value after the transfer is $8,367.94. On July 1, your DCA Plus Fixed Option has now increased to $8,401.56. We will transfer $1,680.31 ($8,401.56 / 5) to the Variable Investment Options, leaving a remaining value of $6,721.25 in the DCA Plus Fixed Option.
During the Guarantee Term, you can allocate all or a part of any additional Purchase Payments to the DCA Plus Fixed Option. Additional allocations must be at least $250. Each additional allocation will be transferred to the Variable Investment Options you select over the remaining Guarantee Term. Transfers will be made from the DCA Plus Fixed Option Value attributed to the oldest Investment allocation and each subsequent Purchase Payment in the order received.
Example: (using the previous example): On July 15, an additional $5,000 Purchase Payment is allocated to the DCA Plus Option at a Guaranteed Interest Rate of 4.00%. On August 1, your DCA Plus Fixed Option Value has increased to $11,758.30. An amount equal to $2,939.58 ($11,758.30 / 4) is transferred from the DCA Plus Fixed Option to the Variable Investment Options. The remaining DCA Plus Fixed Option Value is $8,818.72.
Transfers
DCA Plus transfers must be made on a monthly basis to the Variable Investment Options. No transfers to the DCA Plus Fixed Option may be made at any time. You cannot choose to transfer other than monthly. Unless otherwise instructed, any additional Purchase Payment we receive during a Guarantee Term will be allocated to the Investment Options, including the DCA Plus Fixed Option if so indicated, according to your most recent allocation instructions.
If the Owner dies while transfers are being made from the DCA Plus Fixed Option and the surviving spouse of the deceased Owner elects to continue the Contract in accordance with its terms, transfers will continue to be made from the DCA Plus Fixed Option to the selected Variable Investment Options, until the Guarantee Term ends.
DCA Plus Fixed Option interest is compounded annually and credited to your Contract daily. The Guaranteed Interest Rate is credited on a declining balance as money is transferred from the DCA Plus Fixed Option to the selected Variable Investment Options. The equivalent annual rate reflects the amount of interest that will be transferred to selected Variable Investment Options over the entire Guarantee Term divided by the amount originally invested in the DCA Plus Fixed Option.
Example: On May 1, you submit a $10,000 Purchase Payment entirely to the DCA Plus Fixed Option at a then current Guaranteed Interest Rate of 4.00% with a Guarantee Term of 12 months. Over the entire Guarantee Term, $216.33 of interest is transferred to the selected Variable Investment Options. The equivalent annual rate will equal 2.16% during the Guarantee Term.
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CONTENTS OF THE STATEMENT OF ADDITIONAL INFORMATION
PERFORMANCE
Total Returns
Yields
Performance Comparisons and Benchmarks
Power of Tax Deferral
DISTRIBUTION OF THE CONTRACTS
Pacific Select Distributors, LLC (PSD)
THE CONTRACTS AND THE SEPARATE ACCOUNT
Calculating Subaccount Unit Values
Variable Annuity Payment Amounts
Redemptions of Remaining Guaranteed Variable Payments Under Options 2, 4 and Joint Life with Period Certain
Corresponding Dates
Age and Sex of Owner and Annuitant
Systematic Transfer Programs
Pre-Authorized Withdrawals
More on Federal Tax Issues
Safekeeping of Assets
FINANCIAL STATEMENTS
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM AND INDEPENDENT AUDITORS
You can receive a copy of the Pacific Choice Income SAI without charge by calling us at (800) 722-4448 or you can visit our website at www.pacificlife.com to download a copy. financial professional may call us at (800) 722-2333.
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FUTURE INCOME GENERATOR (SINGLE AND JOINT)
SAMPLE CALCULATIONS APPENDIX
The examples provided are based on certain hypothetical assumptions and are for example purposes only. Where Contract Value is reflected, the examples do not assume any specific return percentage. The examples have been provided to assist in understanding the benefits provided by this Rider and to demonstrate how Purchase Payments received and withdrawals made from the Contract prior to the Annuity Date affect the values and benefits under this Rider over an extended period of time. There may be minor differences in the calculations due to rounding. These examples are not intended to serve as projections of future investment returns nor are they a reflection of how your Contract will actually perform.
The examples may not reflect the current Annual Credit Percentage or the current Withdrawal Percentages. The Annual Credit Percentage and Withdrawal Percentages are disclosed in a Rate Sheet Prospectus Supplement applicable to your Contract.
The examples apply to Future Income Generator (Single) and (Joint) unless otherwise noted below.
Example #1 – Setting of Initial Values.
The values shown below are based on the following assumptions:
· Initial Purchase Payment = $100,000
· Rider Effective Date = Contract Date
· Every Designated Life is 65 years old.
Purchase Payment | Withdrawal | Contract Value | Annual Credit | Protected Payment Base | Protected
| |
Rider Effective Date | $100,000 | $100,000 | $0 | $100,000 | $5,000 |
On the Rider Effective Date, the initial values are set as follows:
· Annual Credit = $0
· Protected Payment Base = Initial Purchase Payment = $100,000
· Protected Payment Amount = 5% of Protected Payment Base = $5,000
Example #2 – Subsequent Purchase Payment.
The values shown below are based on the following assumptions:
· Initial Purchase Payment = $100,000
· Rider Effective Date = Contract Date
· Every Designated Life is 65 years old.
· A subsequent Purchase Payment of $25,000 is received during Contract Year 1.
· No withdrawals taken.
· Annual Credit Percentage of 7%
· Protected Payment Amount = 5% of Protected Payment Base.
· Each Contract Anniversary referenced in the table represents the first calendar day of the applicable Contract Year.
Purchase Payment | Withdrawal | Contract Value | Annual Credit | Protected Payment Base | Protected Payment Amount | |
Rider Effective Date | $100,000 | $100,000 | $0 | $100,000 | $5,000 | |
Activity | $25,000 | $125,000 | $0 | $125,000 | $6,250 | |
Year 2 Contract Anniversary | $130,000 | $8,750 | $133,750 | $6,688 |
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Immediately after the $25,000 subsequent Purchase Payment during Contract Year 1, the Protected Payment Base, is increased by the Purchase Payment amount to $125,000 ($100,000 + $25,000). The Protected Payment Amount after the Purchase Payment is equal to $6,250 (5% of the Protected Payment Base after the Purchase Payment).
Since no withdrawal occurred prior to Year 2 Contract Anniversary, an annual credit of $8,750 (7% of total Purchase Payments) is applied to the Protected Payment Base, increasing it to $133,750. On Year 2 Contract Anniversary, the Protected Payment Base (after the Annual Credit) is higher than the Contract Value, so no automatic reset occurs. The Protected Payment Amount on that Contract Anniversary is equal to $6,688 (5% of the Protected Payment Base on that Contract Anniversary).
In addition to Purchase Payments, the Contract Value is further subject to increases and/or decreases during each Contract Year as a result of charges, fees and other deductions, and increases and/or decreases in the investment performance of the Variable Account.
Example #3 – Withdrawal Not Exceeding Protected Payment Amount.
The values shown below are based on the following assumptions:
· Initial Purchase Payment = $100,000
· Rider Effective Date = Contract Date
· Every Designated Life is 65 years old.
· A subsequent Purchase Payment of $25,000 is received during Contract Year 1.
· A withdrawal equal to or less than the Protected Payment Amount is taken during Contract Year 2.
· Annual Credit Percentage of 7%.
· Protected Payment Amount = 5% of Protected Payment Base.
· Automatic Resets at Beginning of Contract Years 4 and 5.
· Each Contract Anniversary referenced in the table represents the first calendar day of the applicable Contract Year.
Purchase | Withdrawal | Contract Value | Annual Credit | Protected Payment Base | Protected Payment Amount | |
Rider Effective Date | $100,000 | $100,000 | $0 | $100,000 | $5,000 | |
Activity | $25,000 | $125,000 | $0 | $125,000 | $6,250 | |
Year 2 Contract Anniversary | $130,000 | $8,750 | $133,750 | $6,688 | ||
Activity | $4,000 | $128,000 | $133,750 | $2,688 | ||
Year 3 Contract Anniversary | $130,000 | NA | $133,750 | $6,688 | ||
Year 4 Contract Anniversary | (Prior to Automatic Reset) | $145,000 | NA | $133,750 | $6,688 | |
Year 4 Contract Anniversary | (After Automatic Reset) | $145,000 | NA | $145,000 | $7,250 | |
Activity | $7,250 | $142,000 | $145,000 | $0 | ||
Year 5 Contract Anniversary | (Prior to Automatic Reset) | $150,000 | NA | $145,000 | $7,250 | |
Year 5 Contract Anniversary | (After Automatic Reset) | $150,000 | NA | $150,000 | $7,500 |
For an explanation of the values and activities at the start of and during Contract Year 1, refer to Examples #1 and #2.
As the withdrawal during Contract Year 2 did not exceed the Protected Payment Amount immediately prior to the withdrawal ($6,688):
· the Protected Payment Base remains unchanged; and
· since a withdrawal occurred, the Annual Credit will no longer apply.
At Year 3 Contract Anniversary, since the Contract Value ($130,000) is less than the Protected Payment Base ($133,750), no Automatic Reset occurs. The Protected Payment Amount will be $6,688 (5% of the Protected Payment Base).
At Year 4 Contract Anniversary, the Protected Payment Base ($133,750) was less than the Contract Value ($145,000) on that Contract Anniversary (see balances at Year 4 Contract Anniversary – Prior to Automatic Reset), an Automatic Reset occurred which resets
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the Protected Payment Base to an amount equal to 100% of the Contract Value (see balances at Year 4 Contract Anniversary – After Automatic Reset). The Protected Payment Amount is equal to $7,250 (5% of the reset Protected Payment Base).
As the withdrawal during Contract Year 4 did not exceed the Protected Payment Amount immediately prior to the withdrawal ($7,250) the Protected Payment Base remains unchanged.
At Year 5 Contract Anniversary, the Protected Payment Base was less than the Contract Value on that Contract Anniversary (see balances at Year 5 Contract Anniversary – Prior to Automatic Reset), an Automatic Reset occurred which resets the Protected Payment Base to an amount equal to 100% of the Contract Value (see balances at Year 5 Contract Anniversary – After Automatic Reset). The Protected Payment Amount is equal to $7,500 (5% of the reset Protected Payment Base).
Example #4 – Withdrawal Exceeding Protected Payment Amount (Including any applicable withdrawal charges or taxes).
The values shown below are based on the following assumptions:
· Initial Purchase Payment = $100,000
· Rider Effective Date = Contract Date
· Every Designated Life is 65 years old.
· A subsequent Purchase Payment of $25,000 is received during Contract Year 1.
· A withdrawal greater than the Protected Payment Amount is taken during Contract Year 2.
· Annual Credit Percentage of 7%.
· Protected Payment Amount = 5% of Protected Payment Base.
· Contract Value immediately before withdrawal = $130,000.
· Automatic Reset at Beginning of Contract Year 4.
· Each Contract Anniversary referenced in the table represents the first calendar day of the applicable Contract Year.
Purchase Payment | Withdrawal | Contract Value | Annual Credit | Protected Payment Base | Protected Payment Amount | |
Rider Effective Date | $100,000 | $100,000 | $0 | $100,000 | $5,000 | |
Activity | $25,000 | $125,000 | $0 | $125,000 | $6,250 | |
Year 2 Contract Anniversary | $130,000 | $8,750 | $133,750 | $6,688 | ||
Activity | $10,000 | $120,000 (after $10,000 withdrawal) | N/A | $130,152 | $0 | |
Year 3 Contract Anniversary | $115,000 | N/A | $130,152 | $6,508 | ||
Year 4 Contract Anniversary | (Prior to Automatic Reset) | $135,000 | N/A | $130,152 | $6,508 | |
Year 4 Contract Anniversary | (After Automatic Reset) | $135,000 | N/A | $135,000 | $6,750 |
For an explanation of the values and activities at the start of and during Contract Year 1, refer to Examples #1 and #2.
A withdrawal of $10,000 as the gross amount is requested during Contract Year 2. Withdrawal charges do not apply as this amount was within the free withdrawal amount. The gross amount of a withdrawal is used to determine compliance with the rider. If a withdrawal is requested as a net amount, taxes, and any applicable withdrawal charges would be calculated in excess of the net amount and therefore could further reduce the guarantees under the rider. To determine the gross amount in the described scenario the net amount can be divided by (1 – tax percentage withheld).
• $6,500 ÷ (1 - .35) = $10,000 (Gross Amount)
Because the $10,000 withdrawal during Contract Year 2 exceeds the Protected Payment Amount immediately prior to the withdrawal ($10,000 > $6,688), the Protected Payment Base immediately after the withdrawal is reduced. Since a withdrawal occurred, the Annual Credit is no longer applicable.
The Values shown below are based on the following assumptions immediately before the excess withdrawal:
· Contract Value = $130,000
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· Protected Payment Base = $133,750
· Protected Payment Amount = $6,688 (5% × Protected Payment Base; 5% × $133,750 = $6,688)
· No withdrawals were taken prior to the excess withdrawal
A withdrawal of $10,000 was taken, which exceeds the Protected Payment Amount of $6,688 for the Contract Year. The Protected Payment Base will be reduced based on the following calculation:
First, determine the excess withdrawal amount. The excess withdrawal amount is the total withdrawal amount less the Protected Payment Amount. Numerically, the excess withdrawal amount is $3,312 (total withdrawal amount – Protected Payment Amount; $10,000 – $6,688 = $3,312).
Second, determine the ratio for the proportionate reduction. The ratio is the excess withdrawal amount determined above divided by (Contract Value – Protected Payment Amount). The Contract Value prior to the withdrawal was $130,000, which equals the $120,000 after the withdrawal plus the $10,000 withdrawal amount. Numerically, the ratio is 2.69% ($3,312 ÷ ($130,000 – $6,688); $3,312 ÷ $123,312 = 0.0269 or 2.69%).
Third, determine the new Protected Payment Base. The Protected Payment Base will be reduced on a proportionate basis. The Protected Payment Base is multiplied by 1 less the ratio determined above. Numerically, the new Protected Payment Base is $130,152 (Protected Payment Base × (1 – ratio); $133,750 × (1 – 2.69%); $133,750 × 97.31% = $130,152).
The Protected Payment Amount immediately after the withdrawal is equal to $0 (5% of the Protected Payment Base after the withdrawal (5% of $130,152 = $6,508), less cumulative withdrawals during that Contract Year ($10,000), but not less than zero). Since a withdrawal occurred, the Annual Credit will no longer apply.
At Year 3 Contract Anniversary, since the Contract Value ($115,000) is less than the Protected Payment Base ($130,152), no Automatic Reset occurs.
At Year 4 Contract Anniversary, the Protected Payment Base ($130,152) was less than the Contract Value ($135,000) on that Contract Anniversary (see balances at Year 4 Contract Anniversary – Prior to Automatic Reset), an automatic reset occurred which resets the Protected Payment Base to an amount equal to 100% of the Contract Value (see balances at Year 4 Contract Anniversary – After Automatic Reset). The Protected Payment Amount is equal to $6,750 (5% of the reset Protected Payment Base).
Example #5 – Early Withdrawal (Including any applicable withdrawal charges or taxes).
The values shown below are based on the following assumptions:
· Initial Purchase Payment = $100,000
· Rider Effective Date = Contract Date
· Every Designated Life is 56 years old.
· A subsequent Purchase Payment of $25,000 is received during Contract Year 1.
· Annual Credit Percentage of 7%.
· A withdrawal greater than the Protected Payment Amount is taken during Contract Year 3.
· Contract Value immediately before withdrawal = $115,000.
· Automatic Reset at Beginning of Contract Year 6.
· Each Contract Anniversary referenced in the table represents the first calendar day of the applicable Contract Year.
Purchase Payment | Withdrawal | Contract Value | Annual Credit | Protected Payment Base | Protected Payment Amount | |
Rider Effective Date | $100,000 | $100,000 | $0 | $100,000 | $0 | |
Activity | $25,000 | $125,000 | $0 | $125,000 | $0 | |
Year 2 Contract Anniversary | $130,000 | $8,750 | $133,750 | $0 | ||
Year 3 Contract Anniversary | $115,000 | $8,750 | $142,500 | $0 | ||
Activity | $10,000 | $105,000 (after $10,000 withdrawal) | N/A | $130,103 | $0 | |
Year 4 Contract Anniversary | $101,000 | N/A | $130,103 | $0 |
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Purchase Payment | Withdrawal | Contract Value | Annual Credit | Protected Payment Base | Protected Payment Amount | |
Activity (Designated Life reaches age 59½) | $98,000 | N/A | $130,103 | $6,505 | ||
Year 5 Contract Anniversary | $114,000 | N/A | $130,103 | $6,505 | ||
Year 6 Contract Anniversary | (Prior to Automatic Reset) | $132,000 | N/A | $130,103 | $6,505 | |
Year 6 Contract Anniversary | (After to Automatic Reset) | $132,000 | N/A | $132,000 | $6,600 |
For an explanation of the values and activities at the start of and during Contract Year 1 and 2, refer to Examples #1 and #2.
At Year 3 Contract Anniversary, since the Contract Value ($115,000) is less than the Protected Payment Base ($133,750) plus the Annual Credit ($8,750), no Automatic Reset occurs. The Protected Payment Amount is $0 (0% of the Protected Payment Base) since the Designated Life has not reached 59½ years of age.
Because the $10,000 withdrawal during Contract Year 3 exceeds the Protected Payment Amount ($0) immediately prior to the withdrawal, the Protected Payment Base immediately after the withdrawal will be reduced based on the following calculation:
First, determine the early withdrawal amount. The early withdrawal amount is the total withdrawal amount of $10,000.
Second, determine the reduction percentage by dividing the early withdrawal amount by the Contract Value prior to the withdrawal: $10,000 ÷ $115,000 = 0.0870 or 8.70%.
Third, determine the new Protected Payment Base by reducing the Protected Payment Base immediately prior to the withdrawal by the lesser of (a) the total withdrawal amount ($10,000) ($142,500 - $10,000 = $132,500) or (b) the reduction percentage ($142,500 × 8.70%) = $12,397; $142,500 - $12,397 = $130,103. Since $130,103 is less than $132,500, the new Protected Payment Base is $130,103.
At Year 4 Contract Anniversary, since the Contract Value ($101,000) is less than the Protected Payment Base ($130,103), no Automatic Reset occurs. During Year 4, the Designated Life reaches age 59½ and a new Protected Payment Amount will be calculated. The Protected Payment Amount is 5% of the Protected Payment Base ($130,103) which results in a Protected Payment Amount of $6,505.
At Year 5 Contract Anniversary, since the Contract Value ($114,000) is less than the Protected Payment Base ($130,103), no Automatic Reset occurs.
At Year 6 Contract Anniversary, since the Contract Value ($132,000) is greater than the Protected Payment Base ($130,103) on that Contract Anniversary, an Automatic Reset occurs which increases the Protected Payment Base to an amount equal to 100% of the Contract Value (compare balances at Year 4 Contract Anniversary – Prior to and After Automatic Reset). The Protected Payment Amount is set to $6,600 (5% × $132,000).
Example #6 – RMD Withdrawals.
This is an example of the effect of cumulative RMD Withdrawals during the Contract Year that exceed the Protected Payment Amount established for that Contract Year and its effect on the Protected Payment Base. The Annual RMD Amount is based on the entire interest of your Contract as of the previous year-end. There are no calculations for the Annual Credit since the example has withdrawals occurring immediately.
This table assumes quarterly withdrawals of only the Annual RMD Amount during the Contract Year. The calculated Annual RMD amount for the Calendar Year is $7,500 and the Contract Anniversary is December 20 of each year. The assumed withdrawal rate is 5%.
Activity | RMD | Non-RMD | Annual | Protected | Protected |
12/20/2020 | $100,000 | $5,000 | |||
01/01/2021 | $7,500 | ||||
03/15/2021 | $1,875 | $100,000 | $3,125 | ||
6/15/2021 | $1,875 | $100,000 | $1,250 |
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Activity | RMD | Non-RMD | Annual | Protected | Protected |
9/15/2021 | $1,875 | $100,000 | $0 | ||
12/15/2021 | $1,875 | $100,000 | $0 | ||
12/20/2021 Contract Anniversary | $100,000 | $5,000 | |||
01/01/2022 | $8,000 | ||||
03/15/2022 | $2,000 | $100,000 | $3,000 |
Because all withdrawals during the Contract Year (12/20/20 through 12/19/21) were RMD Withdrawals, there is no adjustment to the Protected Payment Base for exceeding the Protected Payment Amount. In addition, each contract year the Protected Payment Amount is reduced by the amount of each withdrawal until the Protected Payment Amount is zero. Since the RMD Amount for 2022 increases to $8,000, the quarterly withdrawals of the RMD Amount increase to $2,000, as shown by the RMD Withdrawal on March 15, 2022.
This chart assumes quarterly withdrawals of the Annual RMD Amount and other non-RMD Withdrawals during the Contract Year. The calculated Annual RMD Amount and Contract Anniversary are the same as above. The assumed withdrawal rate is 5%.
Activity | RMD | Non-RMD | Annual | Protected | Protected |
12/20/2020 Contract Anniversary | $100,000 | $5,000 | |||
01/01/2021 | $7,500 | ||||
03/15/2021 | $1,875 | $100,000 | $3,125 | ||
06/15/2021 | $1,875 | $100,000 | $1,250 | ||
08/01/2021 | $4,000 | $96,900 | $0 |
On 3/15/21 and 6/15/21 there were RMD Withdrawals of $1,875 that reduced the Protected Payment Amount by the amount of the withdrawals. On 8/1/21 a non-RMD Withdrawal of $4,000 caused the cumulative withdrawals during the Contract Year ($7,750) to exceed the Protected Payment Amount ($5,000). As the withdrawal exceeded the Protected Payment Amount immediately prior to the withdrawal ($1,250), and assuming the Contract Value was $90,000 immediately prior to the withdrawal, the Protected Payment Base is reduced to $96,900.
The Values shown below are based on the following assumptions immediately before the excess withdrawal:
· Contract Value = $90,000
· Protected Payment Base = $100,000
· Protected Payment Amount = $1,250
A withdrawal of $4,000 was taken, which exceeds the Protected Payment Amount of $1,250. The Protected Payment Base will be reduced based on the following calculation:
First, determine the excess withdrawal amount. The excess withdrawal amount is the total withdrawal amount less the Protected Payment Amount. Numerically, the excess withdrawal amount is $2,750 (total withdrawal amount – Protected Payment Amount; $4,000 – $1,250 = $2,750).
Second, determine the ratio for the proportionate reduction. The ratio is the excess withdrawal amount determined above divided by (Contract Value – Protected Payment Amount); the calculation is based on the Contract Value and the Protected Payment Amount values immediately before the excess withdrawal. Numerically, the ratio is 3.10% ($2,750 ÷ ($90,000 – $1,250); $2,750 ÷ $88,750 = 0.0310 or 3.10%).
Third, determine the new Protected Payment Base. The Protected Payment Base will be reduced on a proportionate basis. The Protected Payment Base is multiplied by 1 less the ratio determined above. Numerically, the new Protected Payment Base is $96,900 (Protected Payment Base × (1 – ratio); $100,000 × (1 – 3.10%); $100,000 × 96.90% = $96,900).
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Example #7 – Higher Age Band Reached Due to an Automatic Reset.
The values shown below are based on the following assumptions:
· Initial Purchase Payment = $100,000
· Rider Effective Date = Contract Date
· Every Designated Life is 64 years old.
· No subsequent Purchase Payments are received.
· Automatic Resets at Contract Years 2 and 7.
· Withdrawals, are taken each Contract Year:
· Equal 4% of the Protected Payment Base in Contract Year 1 (age 64)
· Equal 5% of the Protected Payment Base in Contract Years 2-6 (age 65-69)
· Equal 6% of the Protected Payment Base in Contract Years 7-22 (age 70-85)
Contract | Withdrawal | End
of Year | Protected | Protected |
1 | $4,000 | $99,000 | $100,000 | $4,000 |
Year 2 Contract Anniversary | (Before Automatic Reset) | $102,000 | $100,000 | $4,000 |
Year 2 Contract Anniversary | (After Automatic Reset) | $102,000 | $102,000 | $5,100 |
3 | $5,100 | $96,909 | $102,000 | $5,100 |
4 | $5,100 | $97,816 | $102,000 | $5,100 |
5 | $5,100 | $99,691 | $102,000 | $5,100 |
6 | $5,100 | $98,648 | $102,000 | $5,100 |
Year 7 Contract Anniversary | (Before Automatic Reset) | $105,000 | $102,000 | $5,100 |
Year 7 Contract Anniversary | (After Automatic Reset) | $105,000 | $105,000 | $6,300 |
8 | $6,300 | $97,650 | $105,000 | $6,300 |
9 | $6,300 | $96,875 | $105,000 | $6,300 |
10 | $6,300 | $94,078 | $105,000 | $6,300 |
11 | $6,300 | $98,805 | $105,000 | $6,300 |
12 | $6,300 | $95,478 | $105,000 | $6,300 |
13 | $6,300 | $92,096 | $105,000 | $6,300 |
14 | $6,300 | $88,660 | $105,000 | $6,300 |
15 | $6,300 | $89,168 | $105,000 | $6,300 |
16 | $6,300 | $91,619 | $105,000 | $6,300 |
17 | $6,300 | $92,013 | $105,000 | $6,300 |
18 | $6,300 | $91,349 | $105,000 | $6,300 |
19 | $6,300 | $89,626 | $105,000 | $6,300 |
20 | $6,300 | $86,844 | $105,000 | $6,300 |
21 | $6,300 | $82,002 | $105,000 | $6,300 |
22 | $6,300 | $80,099 | $105,000 | $6,300 |
On the Rider Effective Date, the initial values are set as follows:
· Protected Payment Base = Initial Purchase Payment = $100,000
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· Protected Payment Amount = 4% of Protected Payment Base = $4,000
At Year 2 Contract Anniversary, since the Protected Payment Base was less than the Contract Value on that Contract Anniversary (see balances at Year 2 Contract Anniversary – Before Automatic Reset), an Automatic Reset occurred which increased the Protected Payment Base to an amount equal to 100% of the Contract Value (see balances at Year 2 Contract Anniversary – After Automatic Reset). Since the Designated Life is 65 years of age when the Automatic Reset occurred, the Protected Payment Amount equals $5,100 (5% of the Protected Payment Base).
At Year 7 Contract Anniversary, since the Protected Payment Base was less than the Contract Value on that Contract Anniversary (see balances at Year 7 Contract Anniversary – Before Automatic Reset), an Automatic Reset occurred which increased the Protected Payment Base to an amount equal to 100% of the Contract Value (see balances at Year 7 Contract Anniversary – After Automatic Reset). Since the Designated Life is now 70 years of age when the Automatic Reset occurred, the Protected Payment Amount equals $6,300 (6% of the Protected Payment Base).
Example #8 – Higher Age Band Reached Due to an Owner-Elected Reset.
The values shown below are based on the following assumptions:
· Initial Purchase Payment = $100,000
· Rider Effective Date = Contract Date
· Every Designated Life is 64 years old.
· No subsequent Purchase Payments are received.
· Owner-Elected Resets at Contract Years 2 and 7.
· Withdrawals, are taken each Contract Year:
· Equal 4% of the Protected Payment Base in Contract Year 1 (age 64)
· Equal 5% of the Protected Payment Base in Contract Years 2-6 (age 65-69)
· Equal 6% of the Protected Payment Base in Contract Years 7-22 (age 70-85)
Contract | Withdrawal | End of Year | Protected | Protected |
1 | $4,000 | $98,000 | $100,000 | $4,000 |
Year 2 Contract Anniversary | (Before Owner-Elected Reset) | $99,000 | $100,000 | $4,000 |
Year 2 Contract Anniversary | (After Owner-Elected Reset) | $99,000 | $99,000 | $4,950 |
3 | $4,950 | $96,909 | $99,000 | $4,950 |
4 | $4,950 | $97,816 | $99,000 | $4,950 |
5 | $4,950 | $98,512 | $99,000 | $4,950 |
6 | $4,950 | $98,648 | $99,000 | $4,950 |
Year 7 Contract Anniversary | (Before Owner-Elected Reset) | $98,000 | $99,000 | $4,950 |
Year 7 Contract Anniversary | (After Owner-Elected Reset) | $98,000 | $98,000 | $5,880 |
8 | $5,880 | $97,650 | $98,000 | $5,880 |
9 | $5,880 | $96,875 | $98,000 | $5,880 |
10 | $5,880 | $94,078 | $98,000 | $5,880 |
11 | $5,880 | $97,528 | $98,000 | $5,880 |
12 | $5,880 | $95,478 | $98,000 | $5,880 |
13 | $5,880 | $92,096 | $98,000 | $5,880 |
14 | $5,880 | $88,660 | $98,000 | $5,880 |
15 | $5,880 | $89,168 | $98,000 | $5,880 |
16 | $5,880 | $91,619 | $98,000 | $5,880 |
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Contract | Withdrawal | End of Year | Protected | Protected |
17 | $5,880 | $92,013 | $98,000 | $5,880 |
18 | $5,880 | $91,349 | $98,000 | $5,880 |
19 | $5,880 | $89,626 | $98,000 | $5,880 |
20 | $5,880 | $86,844 | $98,000 | $5,880 |
21 | $5,880 | $82,002 | $98,000 | $5,880 |
22 | $5,880 | $80,099 | $98,000 | $5,880 |
On the Rider Effective Date, the initial values are set as follows:
· Protected Payment Base = Initial Purchase Payment = $100,000
· Protected Payment Amount = 4% of Protected Payment Base = $4,000
At Year 2 Contract Anniversary, since the Protected Payment Base was greater than the Contract Value on that Contract Anniversary (see balances at Year 2 Contract Anniversary – Before Owner-Elected Reset), an Automatic Reset did not occur. The Designated Life is 65 years of age and elects an Owner-Elected Reset which decreased the Protected Payment Base to an amount equal to 100% of the Contract Value (see balances at Year 2 Contract Anniversary – After Owner-Elected Reset). Since the Designated Life is 65 years of age when the Owner-Elected Reset occurred, the Protected Payment Amount equals $4,950 (5% of the Protected Payment Base).
At Year 7 Contract Anniversary, since the Protected Payment Base was greater than the Contract Value on that Contract Anniversary (see balances at Year 7 Contract Anniversary – Before Owner-Elected Reset), an Automatic Reset did not occur. The Designated Life is 70 years of age and elects an Owner-Elected Reset which decreased the Protected Payment Base to an amount equal to 100% of the Contract Value (see balances at Year 7 Contract Anniversary – After Owner-Elected Reset). Since the Designated Life is now 70 years of age when the Owner-Elected Reset occurred, the Protected Payment Amount equals $5,880 (6% of the Protected Payment Base).
Example #9 – Lifetime Income.
This example applies to the Future Income Generator (Single) only.
The values shown below are based on the following assumptions:
· Initial Purchase Payment = $100,000
· Rider Effective Date = Contract Date
· Every Designated Life is 65 years old.
· No subsequent Purchase Payments are received.
· Withdrawals of 5% of the Protected Payment Base are taken each Contract Year.
· No Automatic Reset is assumed during the life of the Rider.
· Annual Credit does not apply.
· Contract Value goes to zero during Contract Year 21.
· Death occurs during Contract Year 27 after the $5,000 withdrawal was made.
Contract | Withdrawal | End of Year | Protected | Protected |
1 | $5,000 | $95,900 | $100,000 | $5,000 |
2 | $5,000 | $91,739 | $100,000 | $5,000 |
3 | $5,000 | $87,515 | $100,000 | $5,000 |
4 | $5,000 | $83,227 | $100,000 | $5,000 |
5 | $5,000 | $78,876 | $100,000 | $5,000 |
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Contract | Withdrawal | End of Year | Protected | Protected |
6 | $5,000 | $74,459 | $100,000 | $5,000 |
7 | $5,000 | $69,976 | $100,000 | $5,000 |
8 | $5,000 | $65,425 | $100,000 | $5,000 |
9 | $5,000 | $60,807 | $100,000 | $5,000 |
10 | $5,000 | $56,119 | $100,000 | $5,000 |
11 | $5,000 | $51,361 | $100,000 | $5,000 |
12 | $5,000 | $46,531 | $100,000 | $5,000 |
13 | $5,000 | $41,629 | $100,000 | $5,000 |
14 | $5,000 | $36,653 | $100,000 | $5,000 |
15 | $5,000 | $31,603 | $100,000 | $5,000 |
16 | $5,000 | $26,477 | $100,000 | $5,000 |
17 | $5,000 | $21,274 | $100,000 | $5,000 |
18 | $5,000 | $15,994 | $100,000 | $5,000 |
19 | $5,000 | $10,633 | $100,000 | $5,000 |
20 | $5,000 | $5,193 | $100,000 | $5,000 |
21 | $5,000 | $0 | $100,000 | $5,000 |
22 | $5,000 | $0 | $100,000 | $5,000 |
23 | $5,000 | $0 | $100,000 | $5,000 |
24 | $5,000 | $0 | $100,000 | $5,000 |
25 | $5,000 | $0 | $100,000 | $5,000 |
26 | $5,000 | $0 | $100,000 | $5,000 |
27 | $5,000 | $0 | $100,000 | $5,000 |
On the Rider Effective Date, the initial values are set as follows:
· Protected Payment Base = Initial Purchase Payment = $100,000
· Protected Payment Amount = 5% of Protected Payment Base = $5,000
Because the amount of each withdrawal does not exceed the Protected Payment Amount immediately prior to the withdrawal ($5,000), the Protected Payment Base remains unchanged.
During Contract Year 21, the Contract Value is reduced to zero after the Protected Payment Amount of $5,000 is withdrawn. Withdrawals of the Protected Payment Amount ($5,000) will continue to be paid each year (even if Contract Value is zero) until the date of death of the Designated Life or when a death benefit becomes payable under the Contract.
Example #10 – Lifetime Income.
This example applies to the Future Income Generator (Joint) only.
The values shown below are based on the following assumptions:
· Initial Purchase Payment = $100,000
· Rider Effective Date = Contract Date
· Every Designated Life is 65 years old.
· No subsequent Purchase Payments are received.
· Withdrawals of 5% of the Protected Payment Base are taken each Contract Year.
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· No Automatic Reset is assumed during the life of the Rider.
· Annual Credit does not apply.
· All Designated Lives remain eligible for lifetime income benefits while the Rider is in effect.
· Surviving Spouse continued Contract upon death of the first Designated Life.
· Contract Value goes to zero during Contract Year 21.
· Surviving Spouse dies during Contract Year 27 after the $5,000 withdrawal was made.
Contract | Withdrawal | End
of Year | Protected | Protected |
1 | $5,000 | $95,900 | $100,000 | $5,000 |
2 | $5,000 | $91,739 | $100,000 | $5,000 |
3 | $5,000 | $87,515 | $100,000 | $5,000 |
4 | $5,000 | $83,227 | $100,000 | $5,000 |
5 | $5,000 | $78,876 | $100,000 | $5,000 |
6 | $5,000 | $74,459 | $100,000 | $5,000 |
7 | $5,000 | $69,976 | $100,000 | $5,000 |
8 | $5,000 | $65,425 | $100,000 | $5,000 |
9 | $5,000 | $60,807 | $100,000 | $5,000 |
10 | $5,000 | $56,119 | $100,000 | $5,000 |
11 | $5,000 | $51,361 | $100,000 | $5,000 |
12 | $5,000 | $46,531 | $100,000 | $5,000 |
13 | $5,000 | $41,629 | $100,000 | $5,000 |
Activity (Death of first
Designated Life) | $5,000 | $36,653 | $100,000 | $5,000 |
15 | $5,000 | $31,603 | $100,000 | $5,000 |
16 | $5,000 | $26,477 | $100,000 | $5,000 |
17 | $5,000 | $21,274 | $100,000 | $5,000 |
18 | $5,000 | $15,994 | $100,000 | $5,000 |
19 | $5,000 | $10,633 | $100,000 | $5,000 |
20 | $5,000 | $5,193 | $100,000 | $5,000 |
21 | $5,000 | $0 | $100,000 | $5,000 |
22 | $5,000 | $0 | $100,000 | $5,000 |
23 | $5,000 | $0 | $100,000 | $5,000 |
24 | $5,000 | $0 | $100,000 | $5,000 |
25 | $5,000 | $0 | $100,000 | $5,000 |
26 | $5,000 | $0 | $100,000 | $5,000 |
27 | $5,000 | $0 | $100,000 | $5,000 |
On the Rider Effective Date, the initial values are set as follows:
· Protected Payment Base = Initial Purchase Payment = $100,000
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· Protected Payment Amount = 5% of Protected Payment Base = $5,000
Because the amount of each withdrawal does not exceed the Protected Payment Amount immediately prior to the withdrawal ($5,000), the Protected Payment Base remains unchanged.
During Contract Year 14, the death of the first Designated Life occurred. Withdrawals of the Protected Payment Amount (5% of the Protected Payment Base) will continue to be paid each year.
If there was a change in Owner, Beneficiary or marital status prior to the death of the first Designated Life that results in the surviving Designated Life (spouse) to become ineligible for lifetime income benefits, then the lifetime income benefits under the Rider would not continue for the surviving Designated Life and the Rider would termination upon the death of the first Designated Life.
During Contract Year 21, the Contract Value is reduced to zero after the Protected Payment Amount of $5,000 is withdrawn. Withdrawals of the Protected Payment Amount ($5,000) will continue to be paid each year (even if Contract Value is zero) until the date of death of the surviving Designated Life or when a death benefit becomes payable under the Contract.
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ENHANCED INCOME SELECT 2 (SINGLE AND JOINT)
SAMPLE CALCULATIONS APPENDIX
The examples provided are based on certain hypothetical assumptions and are for example purposes only. Where Contract Value is reflected, the examples do not assume any specific return percentage. The examples have been provided to assist in understanding the benefits provided by this Rider and to demonstrate how Purchase Payments received and withdrawals made from the Contract prior to the Annuity Date affect the values and benefits under this Rider over an extended period of time. There may be minor differences in the calculations due to rounding. These examples are not intended to serve as projections of future investment returns nor are they a reflection of how your Contract will actually perform.
The examples may not reflect the current Annual Credit Percentage, Enhanced Income Percentages or the current Guaranteed Lifetime Income Percentage. The Annual Credit Percentage Enhanced Income Percentages, and Guaranteed Lifetime Income Percentage are disclosed in a Rate Sheet Prospectus Supplement applicable to your Contract.
The examples apply to Enhanced Income Select 2 (Single) and (Joint) unless otherwise noted below.
Example #1 – Setting of Initial Values.
The values shown below are based on the following assumptions:
· Initial Purchase Payment = $100,000
· Rider Effective Date = Contract Date
· Every Designated Life is 65 years old.
Purchase | Withdrawal | Contract | Annual Credit | Protected | Enhanced | |
Rider Effective Date | $100,000 | $100,000 | $0 | $100,000 | $5,000 |
On the Rider Effective Date, the initial values are set as follows:
· Annual Credit = $0
· Protected Payment Base = Initial Purchase Payment = $100,000
· Enhanced Income Amount = 5% of Protected Payment Base = $5,000
Example #2 – Subsequent Purchase Payment.
The values shown below are based on the following assumptions:
· Initial Purchase Payment = $100,000
· Rider Effective Date = Contract Date
· Every Designated Life is 65 years old.
· A subsequent Purchase Payment of $100,000 is received during Contract Year 1.
· No withdrawals taken.
· Annual Credit Percentage of 6%
· Enhanced Income Amount = 5% of Protected Payment Base
· Automatic Reset at Beginning of Contract Year 2.
· Each Contract Anniversary referenced in the table represents the first calendar day of the applicable Contract Year.
Purchase | Withdrawal | Contract | Annual Credit | Protected | Enhanced | |
Rider Effective Date | $100,000 | $100,000 | $0 | $100,000 | $5,000 | |
Activity | $100,000 | $200,000 | $0 | $200,000 | $10,000 | |
Year 2 Contract Anniversary | (Prior to Automatic Reset) | $220,000 | $12,000 | $212,000 | $10,600 | |
Year 2 Contract Anniversary | (After Automatic Reset) | $220,000 | $220,000 | $11,000 |
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Immediately after the $100,000 subsequent Purchase Payment during Contract Year 1, the Protected Payment Base is increased by the Purchase Payment amount to $200,000 ($100,000 + $100,000). The Enhanced Income Amount after the Purchase Payment is equal to $10,000 (5% of the Protected Payment Base after the Purchase Payment).
Since no withdrawal occurred prior to Year 2 Contract Anniversary, an annual credit of $12,000 (6% of total Purchase Payments) is applied to the Protected Payment Base, increasing it to $212,000 (see balances at Year 2 Contract Anniversary – Prior to Automatic Reset). An automatic reset takes place at Year 2 Contract Anniversary, since the Contract Value is higher than the Protected Payment Base (after the Annual Credit) (see balances at Year 2 Contract Anniversary – After Automatic Reset). The Enhanced Income Amount on that Contract Anniversary is equal to $11,000 (5% of the Protected Payment Base on that Contract Anniversary).
In addition to Purchase Payments, the Contract Value is further subject to increases and/or decreases during each Contract Year as a result of charges, fees and other deductions, and increases and/or decreases in the investment performance of the Variable Account.
Example #3 – Withdrawal Not Exceeding Enhanced Income Amount & Income Rollover Feature (Including any applicable taxes).
The values shown below are based on the following assumptions:
· Initial Purchase Payment = $100,000
· Rider Effective Date = Contract Date
· Every Designated Life is 65 years old.
· A subsequent Purchase Payment of $100,000 is received during Contract Year 1.
· Annual Credit Percentage of 6%.
· A withdrawal equal to or less than the Enhanced Income Amount is taken during Contract Year 2.
· Enhanced Income Amount = 5% of Protected Payment Base.
· Automatic Resets at Beginning of Contract Years 2 and 3.
· Each Contract Anniversary referenced in the table represents the first calendar day of the applicable Contract Year.
Purchase | Withdrawal | Contract | Annual | Protected | Enhanced | Income Rollover Amount | |
Rider Effective Date | $100,000 | $100,000 | $0 | $100,000 | $5,000 | ||
Activity | $100,000 | $200,000 | $0 | $200,000 | $10,000 | ||
Year 2 Contract Anniversary | (Prior to Automatic Reset) | $220,000 | $12,000 | $212,000 | $10,600 | ||
Year 2 Contract Anniversary | (After Automatic Reset) | $220,000 | $220,000 | $11,000 | |||
Activity | $5,000 | $221,490 | $220,000 | $6,000 | |||
Year 3 Contract Anniversary | (Prior to Automatic Reset) | $221,490 | N/A | $220,000 | $11,000 | $6,000 | |
Year 3 Contract Anniversary | (After Automatic Reset) | $221,490 | N/A | $221,490 | $11,075 | $6,000 | |
Activity | $15,000 | $210,000 (after $15,000 withdrawal) | $221,490 | $2,075 | $0 | ||
Year 4 Contract Anniversary | $210,000 | N/A | $221,490 | $11,075 | $2,075 |
For an explanation of the values and activities at the start of and during Contract Year 1, refer to Examples #1 and #2.
As the withdrawal during Contract Year 2 did not exceed the Enhanced Income Amount immediately prior to the withdrawal ($11,000):
• the Protected Payment Base remains unchanged; and
• since a withdrawal occurred, the Annual Credit will no longer apply.
At Year 3 Contract Anniversary, since the Protected Payment Base was less than the Contract Value on that Contract Anniversary (see balances at Year 3 Contract Anniversary – Prior to Automatic Reset), an automatic reset occurs which increases the Protected Payment Base to an amount equal to 100% of the Contract Value (see balances at Year 3 Contract Anniversary – After Automatic Reset). As a result, the Enhanced Income Amount after the automatic reset at the Year 3 Contract Anniversary is equal to $11,075
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(5% of the reset Protected Payment Base). Additionally, since there was $6,000 of unused Enhanced Income Amount at the end of Year 2 that amount becomes the Income Rollover Amount at the start of Year 3.
Because the $15,000 withdrawal during Contract Year 3 did not exceed the sum of the $6,000 Income Rollover Amount and the $11,075 Enhanced Income Amount immediately prior to the withdrawal, the Protected Payment Base remains unchanged. The $6,000 Income Rollover Amount is withdrawn first and the remaining $9,000 reduces the Enhanced Income Amount to $2,075.
At Year 4, since the Contract Value is less than the Protected Payment Base no reset occurs. The $2,075 of unused Enhanced Income Amount from Year 3 becomes the Income Rollover Amount at the start of Year 4.
Example #4 – Withdrawal Exceeding Enhanced Income Amount (Including any applicable withdrawal charges or taxes).
The values shown below are based on the following assumptions:
· Initial Purchase Payment = $100,000
· Rider Effective Date = Contract Date
· Every Designated Life is 65 years old.
· A subsequent Purchase Payment of $100,000 is received during Contract Year 1.
· Annual Credit Percentage of 6%.
· Enhanced Income Amount = 5% of Protected Payment Base.
· A withdrawal greater than the Enhanced Income Amount is taken during Contract Year 2.
· Contract Value immediately before withdrawal = $195,000.
· Automatic Resets at Beginning of Contract Years 2 and 3.
· Each Contract Anniversary referenced in the table represents the first calendar day of the applicable Contract Year.
Purchase | Withdrawal | Contract | Annual | Protected | Enhanced | |
Rider Effective Date | $100,000 | $100,000 | $0 | $100,000 | $5,000 | |
Activity | $100,000 | $200,000 | $0 | $200,000 | $10,000 | |
Year 2 Contract Anniversary | (Prior to Automatic Reset) | $220,000 | $12,000 | $212,000 | $10,600 | |
Year 2 Contract Anniversary | (After Automatic Reset) | $220,000 | $220,000 | $11,000 | ||
Activity | $30,000 | $165,000 | $197,274 | $0 | ||
Year 3 Contract Anniversary | (Prior to Automatic Reset) | $198,000 | N/A | $197,274 | $9,864 | |
Year 3 Contract Anniversary | (After Automatic Reset) | $198,000 | N/A | $198,000 | $9,900 |
For an explanation of the values and activities at the start of and during Contract Year 1, refer to Examples #1 and #2.
A withdrawal of $30,000 as the gross amount is requested during Contract Year 2. The gross amount of a withdrawal is used to determine compliance with the rider. Withdrawal charges apply because the amount withdrawn exceeds the free withdrawal amount. If a withdrawal is requested as a net amount, taxes and any applicable withdrawal charges would be calculated in excess of the net amount and therefore could further reduce the guarantees under the rider. To determine the gross amount in the described scenario the net amount can be divided by (1- tax percentage withheld).
· Free amount prior to withdrawal = $20,000
· Withdrawal charges = $30,000-$20,000 = $10,000 x 8% = $800
· $18,980 (Net Amount) ÷ (1 - .35) = $29,200 + $800 = $30,000 (Gross Amount)
Because the $30,000 withdrawal during Contract Year 2 exceeds the $11,000 Enhanced Income Amount immediately prior to the withdrawal ($30,000 > $11,000), the Protected Payment Base immediately after the withdrawal is reduced. Since a withdrawal occurred, the Annual Credit is no longer applicable.
The Values shown below are based on the following assumptions immediately before the excess withdrawal:
• Contract Value = $195,000
• Protected Payment Base = $220,000
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• Enhanced Income Amount = $11,000 (5% × Protected Payment Base; 5% × $220,000 = $11,000)
• No withdrawals were taken prior to the excess withdrawal
• A withdrawal of $30,000 was taken, which exceeds the Enhanced Income Amount of $11,000 for the Contract Year. The Protected Payment Base will be reduced based on the following calculation:
First, determine the excess withdrawal amount, which is the total withdrawal amount less the Enhanced Income Amount: $30,000 – $11,000 = $19,000.
Second, determine the reduction percentage by dividing the excess withdrawal amount computed above by the difference between the Contract Value and the Enhanced Income Amount immediately before the withdrawal: $19,000 ÷ ($195,000 - $11,000) = 0.1033 or 10.33%.
Third, determine the new Protected Payment Base by reducing the Protected Payment Base immediately prior to the withdrawal by the percentage computed above: $220,000 – ($220,000 × 10.33%) = $197,274.
The Enhanced Income Amount immediately after the withdrawal is equal to $0. This amount
is determined by multiplying the Protected Payment Base before the withdrawal by 5% and then subtracting
all of the withdrawals made during that Contract Year:
(5% × $220,000) – $30,000 = -$19,000 or
$0, since the Enhanced Income Amount can’t be less than zero. Since a withdrawal occurred, the Annual
Credit will no longer apply.
At Year 3 Contract Anniversary, since the Protected Payment Base was less than the Contract Value on that Contract Anniversary, an automatic reset occurs that increases the Protected Payment Base to an amount equal to 100% of the Contract Value on that date. (Compare the balances at Year 3 Contract Anniversary Prior to and After Automatic Reset).
Example #5 – Early Withdrawal (Including any applicable withdrawal charges or taxes).
The values shown below are based on the following assumptions:
· Initial Purchase Payment = $100,000
· Rider Effective Date = Contract Date
· Every Designated Life is 56½ years old.
· A subsequent Purchase Payment of $100,000 is received during Contract Year 1.
· Annual Credit Percentage of 6%.
· A withdrawal greater than the Enhanced Income Amount is taken during Contract Year 2.
· Contract Value immediately before withdrawal = $221,490.
· Automatic Resets at Beginning of Contract Years 2, 3 and 4.
· Each Contract Anniversary referenced in the table represents the first calendar day of the applicable Contract Year.
Purchase | Withdrawal | Contract | Annual | Protected | Enhanced | |
Rider Effective Date | $100,000 | $100,000 | $0 | $100,000 | $0 | |
Activity | $100,000 | $100,000 | $0 | $200,000 | $0 | |
Year 2 Contract Anniversary | (Prior to Automatic Reset) | $220,000 | $12,000 | $212,000 | $0 | |
Year 2 Contract Anniversary | (After Automatic Reset) | $220,000 | $220,000 | $0 | ||
Activity | $25,000 | $196,490 | $195,000 | $0 | ||
Year 3 Contract Anniversary | (Prior to Automatic Reset) | $196,490 | N/A | $195,000 | $0 | |
Year 3 Contract Anniversary | (After Automatic Reset) | $196,490 | N/A | $196,490 | $0 | |
Year 4 Contract Anniversary | (Prior to Automatic Reset) | $205,000 | N/A | $196,490 | $0 | |
Year 4 Contract Anniversary | (After Automatic Reset) | $205,000 | N/A | $205,000 | $10,250 |
For an explanation of the values and activities at the start of and during Contract Year 1, refer to Examples #1 and #2.
Because the $25,000 withdrawal during Contract Year 2 exceeds the $0 Enhanced Income Amount immediately prior to the withdrawal, the Protected Payment Base immediately after the withdrawal will be reduced based on the following calculation:
First, determine the early withdrawal amount. The early withdrawal amount is the total withdrawal amount of $25,000.
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Second, determine the reduction percentage by dividing the early withdrawal amount determined by the Contract Value prior to the withdrawal: $25,000 ÷ $221,490 = 0.1129 or 11.29%.
Third, determine the new Protected Payment Base by reducing the Protected Payment Base immediately prior to the withdrawal by the greater of (a) the total withdrawal amount ($25,000) and (b) the reduction percentage ($220,000 × 11.29%) = $24,838. Since $25,000 is greater than $24,838, the new Protected Payment Base is computed by subtracting $25,000 from the prior Protected Payment Base: $220,000 – $25,000 = $195,000.
At Year 3 Contract Anniversary, since the Protected Payment Base was less than the Contract Value on that Contract Anniversary, an Automatic Reset occurs which increases the Protected Payment Base to an amount equal to 100% of the Contract Value (compare balances at Year 3 Contract Anniversary – Prior to and After Automatic Reset). The Enhanced Income Amount remains at $0 since the Designated Life has not reached age 59½.
At Year 4 Contract Anniversary, since the Protected Payment Base was less than the Contract Value on that Contract Anniversary, an Automatic Reset occurs which increases the Protected Payment Base to an amount equal to 100% of the Contract Value (compare balances at Year 4 Contract Anniversary – Prior to and After Automatic Reset). The Enhanced Income Amount is set to $10,250 (5% × $205,000) since the Designated Life reached age 59½.
Example #6 – RMD Withdrawals.
This is an example of the effect of cumulative RMD Withdrawals during the Contract Year that exceed the Enhanced Income Amount established for that Contract Year and its effect on the Protected Payment Base. The Annual RMD Amount is based on the entire interest of your Contract as of the previous year-end. There are no calculations for the Annual Credit since the example has withdrawals occurring immediately.
This table assumes quarterly withdrawals of only the Annual RMD Amount during the Contract Year. The calculated Annual RMD amount for the Calendar Year is $7,500 and the Contract Anniversary is December 20 of each year. The assumed Enhanced Income Percentage is 5%.
Activity | RMD | Non-RMD | Annual | Protected | Enhanced |
12/20/2020 | $100,000 | $5,000 | |||
01/01/2021 | $7,500 | ||||
03/15/2021 | $1,875 | $100,000 | $3,125 | ||
06/15/2021 | $1,875 | $100,000 | $1,250 | ||
09/15/2021 | $1,875 | $100,000 | $0 | ||
12/15/2021 | $1,875 | $100,000 | $0 | ||
12/20/2021 Contract Anniversary | $100,000 | $5,000 | |||
01/01/2022 | $8,000 | ||||
03/15/2022 | $2,000 | $100,000 | $3,000 |
Because all withdrawals during the Contract Year (12/20/20 through 12/19/21) were RMD Withdrawals, there is no adjustment to the Protected Payment Base for exceeding the Enhanced Income Amount. In addition, each contract year the Enhanced Income Amount is reduced by the amount of each withdrawal until the Enhanced Income Amount is zero. Since the RMD Amount for 2022 increases to $8,000, the quarterly withdrawals of the RMD Amount increase to $2,000, as shown by the RMD Withdrawal on March 15, 2022.
This chart assumes quarterly withdrawals of the Annual RMD Amount and other non-RMD Withdrawals during the Contract Year. The calculated Annual RMD amount and Contract Anniversary are the same as above. The assumed Enhanced Income Percentage is 5%.
Activity | RMD | Non-RMD | Annual | Protected | Enhanced |
12/20/2020 Contract Anniversary | $100,000 | $5,000 | |||
01/01/2021 | $7,500 | ||||
03/15/2021 | $1,875 | $100,000 | $3,125 |
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Activity | RMD | Non-RMD | Annual | Protected | Enhanced |
06/15/2021 | $1,875 | $100,000 | $1,250 | ||
08/01/2021 | $4,000 | $96,900 | $0 |
On 3/15/21 and 6/15/21 there were RMD Withdrawals of $1,875 that reduced the Enhanced Income Amount by the amount of the withdrawals. On 8/1/21 a non-RMD Withdrawal of $4,000 caused the cumulative withdrawals during the Contract Year ($7,750) to exceed the Enhanced Income Amount ($5,000). As the withdrawal exceeded the Enhanced Income Amount immediately prior to the withdrawal ($1,250), and assuming the Contract Value was $90,000 immediately prior to the withdrawal, the Protected Payment Base is reduced to $96,900.
The Values shown below are based on the following assumptions immediately before the excess withdrawal:
· Contract Value = $90,000
· Protected Payment Base = $100,000
· Enhanced Income Amount = $1,250
A withdrawal of $4,000 was taken, which exceeds the Enhanced Income Amount of $1,250. The Protected Payment Base will be reduced based on the following calculation:
First, determine the excess withdrawal amount. The excess withdrawal amount is the total withdrawal amount less the Enhanced Income Amount. Numerically, the excess withdrawal amount is $2,750 (total withdrawal amount – Enhanced Income Amount; $4,000 – $1,250 = $2,750).
Second, determine the ratio for the proportionate reduction. The ratio is the excess withdrawal amount determined above divided by (Contract Value – Enhanced Income Amount); the calculation is based on the Contract Value and the Enhanced Income Amount values immediately before the excess withdrawal. Numerically, the ratio is 3.10% ($2,750 ÷ ($90,000 – $1,250); $2,750 ÷ $88,750 = 0.0310 or 3.10%).
Third, determine the new Protected Payment Base. The Protected Payment Base will be reduced on a proportionate basis. The Protected Payment Base is multiplied by 1 less the ratio determined above. Numerically, the new Protected Payment Base is $96,900 (Protected Payment Base × (1 – ratio); $100,000 × (1 – 3.10%); $100,000 × 96.90% = $96,900).
Example #7 – Higher Age Band Reached Due to an Automatic Reset.
The values shown below are based on the following assumptions:
· Initial Purchase Payment = $100,000
· Rider Effective Date = Contract Date
· Every Designated Life is 64 years old.
· No subsequent Purchase Payments are received.
· Automatic Resets at Contract Years 2 and 7.
· Withdrawals, are taken each Contract Year:
· Equal 4% of the Protected Payment Base in Contract Year 1 (age 64)
· Equal 5% of the Protected Payment Base in Contract Years 2-6 (age 65-69)
· Equal 6% of the Protected Payment Base in Contract Years 7-22 (age 70-85)
Contract | Withdrawal | End
of Year | Protected | Protected |
1 | $4,000 | $99,000 | $100,000 | $4,000 |
Year 2 Contract Anniversary | (Before Automatic Reset) | $102,000 | $100,000 | $4,000 |
Year 2 Contract Anniversary | (After Automatic Reset) | $102,000 | $102,000 | $5,100 |
3 | $5,100 | $96,909 | $102,000 | $5,100 |
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Contract | Withdrawal | End of Year | Protected | Protected |
4 | $5,100 | $97,816 | $102,000 | $5,100 |
5 | $5,100 | $99,691 | $102,000 | $5,100 |
6 | $5,100 | $98,648 | $102,000 | $5,100 |
Year 7 Contract Anniversary | (Before Automatic Reset) | $105,000 | $102,000 | $5,100 |
Year 7 Contract Anniversary | (After Automatic Reset) | $105,000 | $105,000 | $6,300 |
8 | $6,300 | $97,650 | $105,000 | $6,300 |
9 | $6,300 | $96,875 | $105,000 | $6,300 |
10 | $6,300 | $94,078 | $105,000 | $6,300 |
11 | $6,300 | $98,805 | $105,000 | $6,300 |
12 | $6,300 | $95,478 | $105,000 | $6,300 |
13 | $6,300 | $92,096 | $105,000 | $6,300 |
14 | $6,300 | $88,660 | $105,000 | $6,300 |
15 | $6,300 | $89,168 | $105,000 | $6,300 |
16 | $6,300 | $91,619 | $105,000 | $6,300 |
17 | $6,300 | $92,013 | $105,000 | $6,300 |
18 | $6,300 | $91,349 | $105,000 | $6,300 |
19 | $6,300 | $89,626 | $105,000 | $6,300 |
20 | $6,300 | $86,844 | $105,000 | $6,300 |
21 | $6,300 | $82,002 | $105,000 | $6,300 |
22 | $6,300 | $80,099 | $105,000 | $6,300 |
On the Rider Effective Date, the initial values are set as follows:
· Protected Payment Base = Initial Purchase Payment = $100,000
· Enhanced Income Amount = 4% of Protected Payment Base = $4,000
At Year 2 Contract Anniversary, since the Protected Payment Base was less than the Contract Value on that Contract Anniversary (see balances at Year 2 Contract Anniversary – Before Automatic Reset), an Automatic Reset occurred which increased the Protected Payment Base to an amount equal to 100% of the Contract Value (see balances at Year 2 Contract Anniversary – After Automatic Reset). Since the Designated Life is 65 years of age when the Automatic Reset occurred, the Enhanced Income Amount equals $5,100 (5% of the Protected Payment Base).
At Year 7 Contract Anniversary, since the Protected Payment Base was less than the Contract Value on that Contract Anniversary (see balances at Year 7 Contract Anniversary – Before Automatic Reset), an Automatic Reset occurred which increased the Protected Payment Base to an amount equal to 100% of the Contract Value (see balances at Year 7 Contract Anniversary – After Automatic Reset). Since the Designated Life is now 70 years of age when the Automatic Reset occurred, the Enhanced Income Amount equals $6,300 (6% of the Protected Payment Base).
Example #8 – Higher Age Band Reached Due to an Owner-Elected Reset.
The values shown below are based on the following assumptions:
· Initial Purchase Payment = $100,000
· Rider Effective Date = Contract Date
· Every Designated Life is 64 years old.
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· No subsequent Purchase Payments are received.
· Owner-Elected Resets at Contract Years 2 and 7.
· Withdrawals, are taken each Contract Year:
· Equal 4% of the Protected Payment Base in Contract Year 1 (age 64)
· Equal 5% of the Protected Payment Base in Contract Years 2-6 (age 65-69)
· Equal 6% of the Protected Payment Base in Contract Years 7-22 (age 70-85)
Contract | Withdrawal | End
of Year | Protected | Enhanced Income |
1 | $4,000 | $98,000 | $100,000 | $4,000 |
Year 2 Contract Anniversary | (Before Owner-Elected Reset) | $99,000 | $100,000 | $4,000 |
Year 2 Contract Anniversary | (After Owner-Elected Reset) | $99,000 | $99,000 | $4,950 |
3 | $4,950 | $96,909 | $99,000 | $4,950 |
4 | $4,950 | $97,816 | $99,000 | $4,950 |
5 | $4,950 | $98,512 | $99,000 | $4,950 |
6 | $4,950 | $98,648 | $99,000 | $4,950 |
Year 7 Contract Anniversary | (Before Owner-Elected Reset) | $98,000 | $99,000 | $4,950 |
Year 7 Contract Anniversary | (After Owner-Elected Reset) | $98,000 | $98,000 | $5,880 |
8 | $5,880 | $97,650 | $98,000 | $5,880 |
9 | $5,880 | $96,875 | $98,000 | $5,880 |
10 | $5,880 | $94,078 | $98,000 | $5,880 |
11 | $5,880 | $97,528 | $98,000 | $5,880 |
12 | $5,880 | $95,478 | $98,000 | $5,880 |
13 | $5,880 | $92,096 | $98,000 | $5,880 |
14 | $5,880 | $88,660 | $98,000 | $5,880 |
15 | $5,880 | $89,168 | $98,000 | $5,880 |
16 | $5,880 | $91,619 | $98,000 | $5,880 |
17 | $5,880 | $92,013 | $98,000 | $5,880 |
18 | $5,880 | $91,349 | $98,000 | $5,880 |
19 | $5,880 | $89,626 | $98,000 | $5,880 |
20 | $5,880 | $86,844 | $98,000 | $5,880 |
21 | $5,880 | $82,002 | $98,000 | $5,880 |
22 | $5,880 | $80,099 | $98,000 | $5,880 |
On the Rider Effective Date, the initial values are set as follows:
· Protected Payment Base = Initial Purchase Payment = $100,000
· Enhanced Income Amount = 4% of Protected Payment Base = $4,000
At Year 2 Contract Anniversary, since the Protected Payment Base was greater than the Contract Value on that Contract Anniversary (see balances at Year 2 Contract Anniversary – Before Owner-Elected Reset), an Automatic Reset did not occur. The Designated Life is 65 years of age and elects an Owner-Elected Reset which decreased the Protected Payment Base to an amount equal to 100% of the Contract Value (see balances at Year 2 Contract Anniversary – After Owner-Elected Reset). Since the Designated Life is
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65 years of age when the Owner-Elected Reset occurred, the Enhanced Income Amount equals $4,950 (5% of the Protected Payment Base).
At Year 7 Contract Anniversary, since the Protected Payment Base was greater than the Contract Value on that Contract Anniversary (see balances at Year 7 Contract Anniversary – Before Owner-Elected Reset), an Automatic Reset did not occur. The Designated Life is 70 years of age and elects an Owner-Elected Reset which decreased the Protected Payment Base to an amount equal to 100% of the Contract Value (see balances at Year 7 Contract Anniversary – After Owner-Elected Reset). Since the Designated Life is now 70 years of age when the Owner-Elected Reset occurred, the Enhanced Income Amount equals $5,880 (6% of the Protected Payment Base).
Example #9 – Lifetime Income.
This example applies to Enhanced Income Select 2 (Single) only.
The values shown below are based on the following assumptions:
· Initial Purchase Payment = $100,000
· Rider Effective Date = Contract Date
· Every Designated Life is 65 years old.
· No subsequent Purchase Payments are received.
· Withdrawals of 5% of the Protected Payment Base are taken each Contract Year.
· No Automatic Reset or Owner-Elected Reset is assumed during the life of the Rider.
· Contract Value goes to zero during Contract Year 22.
· Guaranteed Lifetime Income Percentage is 3%.
· Death occurs during Contract Year 27 after the $3,000 withdrawal was made.
Contract | Withdrawal | End
of Year | Protected | Enhanced | Guaranteed |
1 | $5,000 | $96,489 | $100,000 | $5,000 | N/A |
2 | $5,000 | $92,410 | $100,000 | $5,000 | N/A |
3 | $5,000 | $88,543 | $100,000 | $5,000 | N/A |
4 | $5,000 | $84,627 | $100,000 | $5,000 | N/A |
5 | $5,000 | $80,662 | $100,000 | $5,000 | N/A |
6 | $5,000 | $76,648 | $100,000 | $5,000 | N/A |
7 | $5,000 | $72,583 | $100,000 | $5,000 | N/A |
8 | $5,000 | $68,467 | $100,000 | $5,000 | N/A |
9 | $5,000 | $64,299 | $100,000 | $5,000 | N/A |
10 | $5,000 | $60,078 | $100,000 | $5,000 | N/A |
11 | $5,000 | $55,805 | $100,000 | $5,000 | N/A |
12 | $5,000 | $51,478 | $100,000 | $5,000 | N/A |
13 | $5,000 | $47,096 | $100,000 | $5,000 | N/A |
14 | $5,000 | $42,660 | $100,000 | $5,000 | N/A |
15 | $5,000 | $38,168 | $100,000 | $5,000 | N/A |
16 | $5,000 | $33,619 | $100,000 | $5,000 | N/A |
17 | $5,000 | $29,013 | $100,000 | $5,000 | N/A |
18 | $5,000 | $24,349 | $100,000 | $5,000 | N/A |
19 | $5,000 | $19,626 | $100,000 | $5,000 | N/A |
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Contract | Withdrawal | End
of Year | Protected | Enhanced | Guaranteed |
20 | $5,000 | $14,844 | $100,000 | $5,000 | N/A |
21 | $5,000 | $10,002 | $100,000 | $5,000 | N/A |
22 | $5,000 | $0 | $100,000 | $5,000 | N/A |
23 | $3,000 | $0 | $100,000 | N/A | $3,000 |
24 | $3,000 | $0 | $100,000 | N/A | $3,000 |
25 | $3,000 | $0 | $100,000 | N/A | $3,000 |
26 | $3,000 | $0 | $100,000 | N/A | $3,000 |
27 | $3,000 | $0 | $100,000 | N/A | $3,000 |
On the Rider Effective Date, the initial values are set as follows:
· Protected Payment Base = Initial Purchase Payment = $100,000
· Enhanced Income Amount = 5% of Protected Payment Base = $5,000
Because the amount of each withdrawal does not exceed the Enhanced Income Amount immediately prior to the withdrawal ($5,000), the Protected Payment Base remains unchanged.
Withdrawals of the Enhanced Income Amount (5% of the Protected Payment Base) will continue to be paid until the Contract Value reaches zero.
During Contract Year 22, the Contract Value is reduced to zero after the Enhanced Income Amount of $5,000 is withdrawn. In the Contract Year that the Contract Value is reduced to zero, any remaining Enhanced Income Amount for that Contract Year can be withdrawn before the start of the next Contract Anniversary.
At the beginning of Contract Year 23, there is no Contract Value and the Enhanced Income Amount will no longer apply. From this point forward, the amount that must be withdrawn annually is the Guaranteed Lifetime Income Amount. The Guaranteed Lifetime Income Amount is determined by multiplying the Guaranteed Lifetime Income Percentage by the Protected Payment Base. The Guaranteed Lifetime Income Amount is $3,000 (3% x $100,000 = $3,000). This amount will be paid at least annually until the death of the Designated Life.
Example #10 – Lifetime Income.
This example applies to Enhanced Income Select (Joint) only.
The values shown below are based on the following assumptions:
· Initial Purchase Payment = $100,000
· Rider Effective Date = Contract Date
· All Designated Lives are 65 years old.
· No subsequent Purchase Payments are received.
· Withdrawals, each equal to 5% of the Protected Payment Base are taken each Contract Year.
· No Automatic Reset is assumed during the life of the Rider.
· All Designated Lives remain eligible for lifetime income benefits while the Rider is in effect.
· Surviving Spouse continues Contract upon the death of the first Designated Life.
· Contract Value goes to zero during Contract Year 22.
· Guaranteed Lifetime Income Percentage is 3%.
· Surviving Spouse dies during Contract Year 26 after the $3,000 withdrawal was made.
Contract | Withdrawal | End
of Year | Protected | Enhanced | Guaranteed |
1 | $5,000 | $96,489 | $100,000 | $5,000 | N/A |
2 | $5,000 | $92,410 | $100,000 | $5,000 | N/A |
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Contract | Withdrawal | End
of Year | Protected | Enhanced | Guaranteed |
3 | $5,000 | $88,543 | $100,000 | $5,000 | N/A |
4 | $5,000 | $84,627 | $100,000 | $5,000 | N/A |
5 | $5,000 | $80,662 | $100,000 | $5,000 | N/A |
6 | $5,000 | $76,648 | $100,000 | $5,000 | N/A |
7 | $5,000 | $72,583 | $100,000 | $5,000 | N/A |
8 | $5,000 | $68,467 | $100,000 | $5,000 | N/A |
9 | $5,000 | $64,299 | $100,000 | $5,000 | N/A |
10 | $5,000 | $60,078 | $100,000 | $5,000 | N/A |
11 | $5,000 | $55,805 | $100,000 | $5,000 | N/A |
12 | $5,000 | $51,478 | $100,000 | $5,000 | N/A |
13 | $5,000 | $47,096 | $100,000 | $5,000 | N/A |
Activity
(Death of first Designated Life) | $5,000 | $42,660 | $100,000 | $5,000 | N/A |
15 | $5,000 | $38,168 | $100,000 | $5,000 | N/A |
16 | $5,000 | $33,619 | $100,000 | $5,000 | N/A |
17 | $5,000 | $29,013 | $100,000 | $5,000 | N/A |
18 | $5,000 | $24,349 | $100,000 | $5,000 | N/A |
19 | $5,000 | $19,626 | $100,000 | $5,000 | N/A |
20 | $5,000 | $14,844 | $100,000 | $5,000 | N/A |
21 | $5,000 | $10,002 | $100,000 | $5,000 | N/A |
22 | $5,000 | $0 | $100,000 | $5,000 | N/A |
23 | $3,000 | $0 | $100,000 | N/A | $3,000 |
24 | $3,000 | $0 | $100,000 | N/A | $3,000 |
25 | $3,000 | $0 | $100,000 | N/A | $3,000 |
26 | $3,000 | $0 | $100,000 | N/A | $3,000 |
On the Rider Effective Date, the initial values are set as follows:
· Protected Payment Base = Initial Purchase Payment = $100,000
· Enhanced Income Amount = 5% of Protected Payment Base = $5,000
Because the amount of each withdrawal does not exceed the Enhanced Income Amount immediately prior to the withdrawal ($5,000), the Protected Payment Base remains unchanged.
Withdrawals of the Enhanced Income Amount (5% of the Protected Payment Base) will continue to be paid until the Contract Value reaches zero.
During Contract Year 14, the death of the first Designated Life occurred. Withdrawals of the Enhanced Income Amount (5% of the Protected Payment Base) will continue to be paid each year.
If there was a change in Owner, Beneficiary or marital status prior to the death of the first Designated Life that resulted in the surviving Designated Life (spouse) to become ineligible for lifetime income benefits, then the lifetime income benefits under the Rider would not continue for the surviving Designated Life and the Rider would terminate upon the death of the first Designated Life.
During Contract Year 22, the Contract Value is reduced to zero after the Enhanced Income Amount of $5,000 is withdrawn. In the Contract Year that the Contract Value is reduced to zero, any remaining Enhanced Income Amount for that Contract Year can be withdrawn before the start of the next Contract Anniversary.
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At the beginning of Contract Year 23, there is no Contract Value and the Enhanced Income Amount will no longer apply. From this point forward, the amount that must be withdrawn annually is the Guaranteed Lifetime Income Amount. The Guaranteed Lifetime Income Amount is determined by multiplying the Guaranteed Lifetime Income Percentage by the Protected Payment Base. The Guaranteed Lifetime Income Amount is $3,000 (3% x $100,000 = $3,000). This amount will be paid at least annually until the death of the surviving Designated Life.
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RETURN OF PURCHASE PAYMENTS DEATH BENEFIT
SAMPLE CALCULATIONS APPENDIX
The examples provided are based on certain hypothetical assumptions and are for example purposes only. Where Contract Value is reflected, the examples do not assume any specific return percentage. They have been provided to assist in understanding the death benefit amount provided under the optional Return of Purchase Payments Death Benefit (Return of Purchase Payments Death Benefit II for Contracts issued in California) and to demonstrate how Purchase Payments and withdrawals made from the Contract may affect the values and benefits. There may be minor differences in the calculations due to rounding. These examples are not intended to reflect what your actual death benefit proceeds will be or serve as projections of future investment returns nor are they a reflection of how your Contract will actually perform.
Under the base Contract (no optional death benefit riders selected), the Death Benefit Amount is equal to the Contract Value.
THE EXAMPLES BELOW ASSUME NO OWNER CHANGE OR AN OWNER CHANGE TO THE PREVIOUS OWNER’S SPOUSE; THESE EXAMPLES APPLY TO CONTRACTS ISSUED IN CALIFORNIA.
Return of Purchase Payments Death Benefit (Return of Purchase Payments Death Benefit II for Contracts issued in California)
The values shown below are based on the following assumptions:
· Initial Purchase Payment = $100,000
· Rider Effective Date = Contract Date
· A subsequent Purchase Payment of $25,000 is received in Contract Year 3.
· A withdrawal of $35,000 is taken during Contract Year 6.
· A withdrawal of $10,000 is taken during Contract Year 11.
Beginning | Purchase | Withdrawal | Contract | Total
Adjusted |
1 | $100,000 | $100,000 | $100,000 | |
2 | $103,000 | $100,000 | ||
3 | $106,090 | $100,000 | ||
Activity | $25,000 | $133,468 | $125,000 | |
4 | $134,458 | $125,000 | ||
5 | $138,492 | $125,000 | ||
6 | $142,647 | $125,000 | ||
Activity | $35,000 | $110,844 | $95,000 | |
7 | $111,666 | $95,000 | ||
8 | $103,850 | $95,000 | ||
9 | $96,580 | $95,000 | ||
10 | $89,820 | $95,000 | ||
11 | $83,530 | $95,000 | ||
Activity | $10,000 | $73,530 | $83,629 | |
12 | $68,383 | $83,629 | ||
13 | $63,596 | $83,629 | ||
14 | $59,144 | $83,629 |
1The greater of the Contract Value or the Total Adjusted Purchase Payments represents the Death Benefit Amount.
On the Rider Effective Date, the initial values are set as follows:
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· Total Adjusted Purchase Payment = Initial Purchase Payment = $100,000
· Contract Value = Initial Purchase Payment = $100,000
During Contract Year 3, an additional Purchase Payment of $25,000 was made. The Total Adjusted Purchase Payment amount increased to $125,000. The Contract Value increased to $133,468.
During Contract Year 6, a withdrawal of $35,000 was made. This withdrawal reduced the Total Adjusted Purchase Payment amount on a pro rata basis to $95,000 and decreased the Contract Value to $110,844. Numerically, the new Total Adjusted Purchase Payment amount is calculated as follows:
First, determine the Pro Rata Reduction. The percentage is the withdrawal amount divided by the Contract Value prior to the withdrawal ($145,844, which equals the $110,844 Contract Value after the withdrawal plus the $35,000 withdrawal amount). Numerically, the percentage is 24.00% ($35,000 ÷ $145,844 = 0.2400 or 24.00%).
Second, determine the new Total Adjusted Purchase Payment amount. The Total Adjusted Purchase Payment amount prior to the withdrawal is multiplied by 1 less the Pro Rata Reduction determined above. Numerically, the new Total Adjusted Purchase Payment amount is $95,000 (Total Adjusted Purchase Payment amount prior to the withdrawal × (1 − Pro Rata Reduction); $125,000 × (1 − 24.00%); $125,000 × 76.00% = $95,000).
During Contract Year 11, a withdrawal of $10,000 was made. This withdrawal reduced the Total Adjusted Purchase Payment amount on a pro rata basis to $83,629 and decreased the Contract Value to $73,530. Numerically, the new Total Adjusted Purchase Payment amount is calculated as follows:
First, determine the Pro Rata Reduction. The percentage is the withdrawal amount divided by the Contract Value prior to the withdrawal ($83,530, which equals the $73,530 Contract Value after the withdrawal plus the $10,000 withdrawal amount). Numerically, the percentage is 11.97% ($10,000 ÷ $83,530 = 0.1197 or 11.97%).
Second, determine the new Total Adjusted Purchase Payment amount. The Total Adjusted Purchase Payment amount prior to the withdrawal is multiplied by 1 less the Pro Rata Reduction determined above. Numerically, the new Total Adjusted Purchase Payment amount is $83,629 (Total Adjusted Purchase Payment prior to the withdrawal × (1 − Pro Rata Reduction); $95,000 × (1 − 11.97%); $95,000 × 88.03% = $83,629). Since the Total Adjusted Purchase Payments were greater than the Contract Value at the time of the withdrawal, the Pro Rata Reduction resulted in the Total Purchase Payments being reduced by a greater amount than the withdrawal amount.
During Contract Year 14, death occurs. The Death Benefit Amount under the Return of Purchase Payments Death Benefit will be the Total Adjusted Purchase Payments ($83,629) because that amount is greater than the Contract Value ($59,144).
Using the table above, if death occurred in Contract Year 7, the Death Benefit Amount under the Return of Purchase Payments Death Benefit would be the Contract Value ($111,666) because that amount is greater than the Total Adjusted Purchase Payment of $95,000.
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THE EXAMPLES BELOW ASSUME OWNER CHANGE TO SOMEONE OTHER THAN PREVIOUS OWNER’S SPOUSE, TO A TRUST OR NON-NATURAL ENTITY WHERE THE OWNER AND ANNUITANT ARE NOT THE SAME PERSON PRIOR TO THE CHANGE OR IF AN OWNER IS ADDED THAT IS NOT A SPOUSE OF THE OWNER. THESE EXAMPLES DO NOT APPLY TO CONTRACTS ISSUED IN CALIFORNIA.
Return of Purchase Payments Death Benefit
The values shown below are based on the following assumptions:
· Initial Purchase Payment = $100,000
· Rider Effective Date = Contract Date
· A subsequent Purchase Payment of $25,000 is received in Contract Year 3.
· A withdrawal of $35,000 is taken during Contract Year 6.
· Owner change to someone other than previous Owner’s Spouse during Contract Year 8.
· A withdrawal of $10,000 is taken during Contract Year 11.
Beginning | Purchase | Withdrawal | Contract | Total
Adjusted |
1 | $100,000 | $100,000 | $100,000 | |
2 | $103,000 | $100,000 | ||
3 | $106,090 | $100,000 | ||
Activity | $25,000 | $133,468 | $125,000 | |
4 | $134,458 | $125,000 | ||
5 | $138,492 | $125,000 | ||
6 | $142,647 | $125,000 | ||
Activity | $35,000 | $110,844 | $95,000 | |
7 | $111,666 | $95,000 | ||
8 | $103,850 | $95,000 | ||
Owner Change | $100,735 | $95,000 | ||
9 | $96,580 | $95,000 | ||
10 | $89,820 | $95,000 | ||
11 | $83,530 | $95,000 | ||
Activity | $10,000 | $73,530 | $83,629 | |
12 | $68,383 | $83,629 | ||
13 | $63,596 | $83,629 | ||
14 | $59,144 | $83,629 |
1The greater of the Contract Value or the Total Adjusted Purchase Payments represents the Death Benefit Amount.
On the Rider Effective Date, the initial values are set as follows:
· Total Adjusted Purchase Payment = Initial Purchase Payment = $100,000
· Contract Value = Initial Purchase Payment = $100,000
During Contract Year 3, an additional Purchase Payment of $25,000 was made. The Total Adjusted Purchase Payment amount increased to $125,000. The Contract Value increased to $133,468.
During Contract Year 6, a withdrawal of $35,000 was made. This withdrawal reduced the Total Adjusted Purchase Payment amount on a pro rata basis to $95,000 and decreased the Contract Value to $110,844. Numerically, the new Total Adjusted Purchase Payment amount is calculated as follows:
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First, determine the Pro Rata Reduction. The percentage is the withdrawal amount divided by the Contract Value prior to the withdrawal ($145,844, which equals the $110,844 Contract Value after the withdrawal plus the $35,000 withdrawal amount). Numerically, the percentage is 24.00% ($35,000 ÷ $145,844 = 0.2400 or 24.00%).
Second, determine the new Total Adjusted Purchase Payment amount. The Total Adjusted Purchase Payment amount prior to the withdrawal is multiplied by 1 less the Pro Rata Reduction determined above. Numerically, the new Total Adjusted Purchase Payment amount is $95,000 (Total Adjusted Purchase Payment amount prior to the withdrawal × (1 − Pro Rata Reduction); $125,000 × (1 − 24.00%); $125,000 × 76.00% = $95,000).
During Contract Year 8, an Owner change to someone other than the previous Owner’s spouse occurred. The Total Adjusted Purchase Payments on the effective date of the Owner change (the “Change Date”) will be reset to equal the lesser of the Contract Value as of the Change Date or the Total Adjusted Purchase Payments as of the Change Date. Numerically, the Total Adjusted Purchase Payments amount will be $95,000 since the Total Adjusted Purchase Payments as of the Change Date ($95,000) is less than the Contract Value as of the Change Date ($100,735).
After the Change Date, the Total Adjusted Purchase Payments will be increased by any Purchase Payments made after the Change Date and will be reduced by any Pro Rata Reduction for withdrawals made after the Change Date.
During Contract Year 11, a withdrawal of $10,000 was made. This withdrawal reduced the Total Adjusted Purchase Payments amount on a pro rata basis to $83,629 and decreased the Contract Value to $73,530. Numerically, the new Total Adjusted Purchase Payments amount is calculated as follows:
First, determine the Pro Rata Reduction. The percentage is the withdrawal amount divided by the Contract Value prior to the withdrawal ($83,530, which equals the $73,530 Contract Value after the withdrawal plus the $10,000 withdrawal amount). Numerically, the percentage is 11.97% ($10,000 ÷ $83,530 = 0.1197 or 11.97%).
Second, determine the new Total Adjusted Purchase Payments amount. The Total Adjusted Purchase Payments amount prior to the withdrawal is multiplied by 1 less the Pro Rata Reduction determined above. Numerically, the new Total Adjusted Purchase Payments amount is $83,629 (Total Adjusted Purchase Payments amount prior to the withdrawal x (1 - Pro Rata Reduction); $95,000 x (1 - 11.97%); $95,000 x 88.03% = $83,629). Since the Total Adjusted Purchase Payments were greater than the Contract Value at the time of the withdrawal, the Pro Rata Reduction resulted in the Total Purchase Payments being reduced by a greater amount than the withdrawal amount.
During Contract Year 14, death occurs. The Death Benefit Amount under the Return of Purchase Payments Death Benefit will be the Total Adjusted Purchase Payments ($83,629) because that amount is greater than the Contract Value ($59,144).
Using the table above, if death occurred in Contract Year 7, the Death Benefit Amount under the Return of Purchase Payments Death Benefit would be the Contract Value ($111,666) because that amount is greater than the Total Adjusted Purchase Payment of $95,000.
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APPENDIX
This appendix provides historical rider percentages for the Enhanced Income Select 2 (Single) and Enhanced Income Select 2 (Joint).
The percentages below apply for applications signed between January 19, 2021 and April 30, 2021, that met the requirements in effect at the time the application was submitted.
Rider Name | Annual Charge Percentage | Annual Credit Percentage |
Enhanced Income Select 2 (Single) | 1.35% | 5.0% |
Enhanced Income Select 2 (Joint) | 1.55% | 5.0% |
The percentages below apply for applications signed between January 19, 2021 and April 30, 2021, that met the requirements in effect at the time the application was submitted.
Age* | Enhanced Income Select 2 (Single) | Enhanced Income Select 2 (Joint) |
Before 59½ | 0% | 0% |
59½ | 4.5% | 4.0% |
60 | 4.5% | 4.0% |
61 | 4.5% | 4.0% |
62 | 4.5% | 4.0% |
63 | 4.5% | 4.0% |
64 | 4.5% | 4.0% |
65 | 7.0% | 6.5% |
66 | 7.0% | 6.5% |
67 | 7.0% | 6.5% |
68 | 7.0% | 6.5% |
69 | 7.0% | 6.5% |
70 | 7.5% | 7.0% |
71 | 7.5% | 7.0% |
72 | 7.5% | 7.0% |
73 | 7.5% | 7.0% |
74 | 7.5% | 7.0% |
75 | 7.5% | 7.0% |
76 | 7.5% | 7.0% |
77 | 7.5% | 7.0% |
78 | 7.5% | 7.0% |
79 | 7.5% | 7.0% |
80 | 7.5% | 7.0% |
81 | 7.5% | 7.0% |
82 | 7.5% | 7.0% |
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Age* | Enhanced Income Select 2 (Single) | Enhanced Income Select 2 (Joint) |
83 | 7.5% | 7.0% |
84 | 7.5% | 7.0% |
85 and older | 7.5% | 7.0% |
* The Age range that applies is based on the age of the Designated Life (Single) or the youngest Designated Life (Joint) at the time of the first withdrawal after age 59½ or the first withdrawal after an Automatic or Owner-Elected Reset occurs.
The Guaranteed Lifetime Income Percentage for applications signed between January 19, 2021 and April 30, 2021, that met requirements in effect at the time the application was submitted.
Age** | Enhanced Income Select 2 (Single) | Enhanced Income Select 2 (Joint) |
Before 59½ | 0% | 0% |
59½ and older | 3.0% | 3.0% |
This appendix provides historical rider percentages for the Future Income Generator (Single) and Future Income Generator (Joint) Riders.
The percentages below apply for applications signed between January 19, 2021 and April 30, 2021, that met the requirements in effect at the time the application was submitted.
Rider Name | Annual Charge Percentage | Annual Credit Percentage |
Future Income Generator (Single) | 1.35% | 5.0% |
Future Income Generator (Joint) | 1.45% | 5.0% |
The percentages below apply for applications signed between January 19, 2021 and April 30, 2021, that met the requirements in effect at the time the application was submitted.
Age* | Future
Income | Future Income |
Before 59½ | 0% | 0% |
59½ | 4.0% | 3.5% |
60 | 4.0% | 3.5% |
61 | 4.0% | 3.5% |
62 | 4.0% | 3.5% |
63 | 4.0% | 3.5% |
64 | 4.0% | 3.5% |
65 | 4.75% | 4.25% |
66 | 4.75% | 4.25% |
67 | 4.75% | 4.25% |
68 | 4.75% | 4.25% |
69 | 4.75% | 4.25% |
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Age* | Future
Income | Future Income |
70 | 4.75% | 4.25% |
71 | 4.75% | 4.25% |
72 | 4.75% | 4.25% |
73 | 4.75% | 4.25% |
74 | 4.75% | 4.25% |
75 | 5.0% | 4.5% |
76 | 5.0% | 4.5% |
77 | 5.0% | 4.5% |
78 | 5.0% | 4.5% |
79 | 5.0% | 4.5% |
80 | 5.0% | 4.5% |
81 | 5.0% | 4.5% |
82 | 5.0% | 4.5% |
83 | 5.0% | 4.5% |
84 | 5.0% | 4.5% |
85 and older | 5.0% | 4.5% |
* The Age range that applies is based on the age of the Designated Life (Single) or the youngest Designated Life (Joint) at the time of the first withdrawal after age 59½ or the first withdrawal after an Automatic or Owner-Elected Reset occurs.
The Guaranteed Lifetime Income Percentage for applications signed between January 19, 2021 and April 30, 2021, that met requirements in effect at the time the application was submitted.
Age** | Enhanced Income Select 2 (Single) | Enhanced Income Select 2 (Joint) |
Before 59½ | 0% | 0% |
59½ and older | 3.0% | 3.0% |
If you purchased a Rider, review the Rider specifications page you received for your Contract, speak with your financial professional, or call us to confirm the percentages applicable to you.
For applications signed May 1, 2021 or after, rider percentages are disclosed in a Rate Sheet Prospectus Supplement in the front of this prospectus.
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FINANCIAL HIGHLIGHTS (CONDENSED FINANCIAL INFORMATION)
As of December 31, 2020, no contracts were issued. As a result, no condensed financial information is included in this Prospectus.
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WHERE TO GO FOR MORE INFORMATION
You will find more information about this variable annuity contract and Separate Account A in the Statement of Additional Information (SAI) dated May 1, 2021.
The SAI has been filed with the SEC and is considered to be part of this Prospectus because it is incorporated by reference. The contents of the SAI are described in this Prospectus – see the Table of Contents.
You can get a copy of the SAI at no charge by visiting our website, calling or writing to us, or by contacting the SEC. The SEC may charge you a fee for this information.
The Pacific Choice Income Contract is offered by Pacific Life Insurance Company, 700 Newport Center Drive. P.O. Box 9000, Newport Beach, California 92660.
If you have any questions about the Contract, please ask your financial professional or contact us.
How to Contact Us
Call or write our Service Center at:
Pacific
Life Insurance Company
P.O. Box 2378
Omaha, Nebraska 68103-2378
Contract Owners: (800) 722-4448
Financial
Professionals: (800) 722-2333
6 a.m. through 5 p.m. Pacific time
Send Purchase Payments, other payments and application forms to our Service Center at the following address:
By mail
Pacific Life Insurance Company
P.O. Box
2290
Omaha, Nebraska 68103-2290
By
overnight delivery service
Pacific Life Insurance Company
6750 Mercy Road, RSD
Omaha,
Nebraska 68106
How to Contact the SEC
Commission’s Public Reference Section
100 F Street, NE
Washington, D.C. 20549
(202) 551-8090
Website: www.sec.gov
e-mail: publicinfo@sec.gov
FINRA Public Disclosure Program
The Financial Industry Regulatory Authority (FINRA) provides investor protection education through its website and printed materials. The FINRA regulation website address is www.finra.org. An investor brochure that includes information describing the BrokerCheck program may be obtained from FINRA. The FINRA BrokerCheck hotline number is (800) 289-9999. FINRA does not charge a fee for the BrokerCheck program services.
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STATEMENT OF ADDITIONAL INFORMATION
PACIFIC CHOICE INCOME® VARIABLE ANNUITY
SEPARATE ACCOUNT A
Pacific Choice Income (the “Contract”) is a variable annuity contract offered by Pacific Life Insurance Company (“Pacific Life”).
This Statement of Additional Information (“SAI”) is not a Prospectus and should be read in conjunction with the Contract’s Prospectus, dated May 1, 2021, and any supplement thereto, which is available without charge upon written or telephone request to Pacific Life or by visiting our website at www.pacificlife.com. Terms used in this SAI have the same meanings as in the Prospectus, and some additional terms are defined particularly for this SAI. This SAI is incorporated by reference into the Contract’s Prospectus.
Pacific Life Insurance Company
Mailing address: P.O. Box 2378
(800) 722-4448 - Contract Owners
(800) 722-2333 - Financial Professionals
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TABLE OF CONTENTS
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM AND INDEPENDENT AUDITORS |
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From time to time, our reports or other communications to current or prospective Contract Owners or our advertising or other promotional material may quote the performance (yield and total return) of a Subaccount. Quoted results are based on past performance and reflect the performance of all assets held in that Subaccount for the stated time period. Quoted results are neither an estimate nor a guarantee of future investment performance, and do not represent the actual experience of amounts invested by any particular Contract Owner.
A Subaccount may advertise its “average annual total return” over various periods of time. “Total return” represents the average percentage change in value of an investment in the Subaccount from the beginning of a measuring period to the end of that measuring period. “Annualized” total return assumes that the total return achieved for the measuring period is achieved for each full year period. “Average annual” total return is computed in accordance with a standard method prescribed by the SEC, and is also referred to as “standardized return.”
Average Annual Total Return
To calculate a Subaccount’s average annual total return for a specific measuring period, we first take a hypothetical $1,000 investment in that Subaccount, at its applicable Subaccount Unit Value (the “initial payment”) and we compute the ending redeemable value of that initial payment at the end of the measuring period based on the investment experience of that Subaccount (“full withdrawal value”). The full withdrawal value reflects the effect of all recurring fees and charges applicable to a Contract Owner under the Contract, including the Risk Charge, the asset-based Administrative Fee and the deduction of the applicable withdrawal charge, but does not reflect any charges for applicable premium taxes and/or any other taxes, any living benefit rider charge, any non-recurring fees or charges, or any increase in the Risk Charge for an optional Death Benefit Rider. The Annual Fee is also taken into account, assuming an average Contract Value of $100,000. The redeemable value is then divided by the initial payment and this quotient is raised to the 365/N power (N represents the number of days in the measuring period), and 1 is subtracted from this result. Average annual total return is expressed as a percentage.
T = (ERV/P)(365/N) – 1
where T = average annual total return
ERV = ending redeemable value
P = hypothetical initial payment of $1,000
N = number of days
Average annual total return figures will be given for recent 1-, 3-, 5- and 10-year periods (if applicable), and may be given for other periods as well (such as from commencement of the Subaccount’s operations, or on a year-by-year basis).
When considering “average” total return figures for periods longer than one year, it is important to note that the relevant Subaccount’s annual total return for any one year in the period might have been greater or less than the average for the entire period.
Aggregate Total Return
A Subaccount may use “aggregate” total return figures along with its “average annual” total return figures for various periods; these figures represent the cumulative change in value of an investment in the Subaccount for a specific period. Aggregate total returns may be shown by means of schedules, charts or graphs and may indicate subtotals of the various components of total return. The SEC has not prescribed standard formulas for calculating aggregate total return.
Total returns may also be shown for the same periods that do not take into account the withdrawal charge or the Annual Fee.
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Non-Standardized Total Returns
We may also calculate non-standardized total returns which may or may not reflect any Annual Fee, withdrawal charges, increases in Risk Charge for an optional Death Benefit Rider, charges for premium taxes and/or any other taxes, any living benefit rider charge, or any non-recurring fees or charges.
Standardized return figures will always accompany any non-standardized returns shown.
Fidelity® VIP Government Money Market Subaccount
The “yield” (also called “current yield”) of the Fidelity® VIP Government Money Market Subaccount is computed in accordance with a standard method prescribed by the SEC. The net change in the Subaccount’s Unit Value during a seven-day period is divided by the Unit Value at the beginning of the period to obtain a base rate of return. The current yield is generated when the base rate is “annualized” by multiplying it by the fraction 365/7; that is, the base rate of return is assumed to be generated each week over a 365-day period and is shown as a percentage of the investment. The “effective yield” of the Fidelity® VIP Government Money Market Subaccount is calculated similarly but, when annualized, the base rate of return is assumed to be reinvested. The effective yield will be slightly higher than the current yield because of the compounding effect of this assumed reinvestment.
The formula for effective yield is: [(Base Period Return + 1) (To the power of 365/7)] - 1.
Realized capital gains or losses and unrealized appreciation or depreciation of the assets of the underlying Fidelity® VIP Government Money Market Portfolio are not included in the yield calculation. Current yield and effective yield do not reflect the deduction of charges for any applicable premium taxes and/or any other taxes, any increase in the Risk Charge for an optional Death Benefit Rider, any living benefit rider charge or any non-recurring fees or charges, but do reflect a deduction for the Annual Fee, the Risk Charge and the asset-based Administrative Fee and assume an average Contract Value of $100,000.
Other Subaccounts
“Yield” of the other Subaccounts is computed in accordance with a different standard method prescribed by the SEC. The net investment income (investment income less expenses) per Subaccount Unit earned during a specified one-month or 30-day period is divided by the Subaccount Unit Value on the last day of the specified period. This result is then annualized (that is, the yield is assumed to be generated each month or each 30-day period for a year), according to the following formula, which assumes semi-annual compounding:
YIELD = 2*[ ( | a–b | + 1)6-1] |
c*d |
where: a = net investment income earned during the period by the Portfolio attributable to the Subaccount.
b = expenses accrued for the period (net of reimbursements).
c = the average daily number of Subaccount Units outstanding during the period that were entitled to receive dividends.
d = the Unit Value of the Subaccount Units on the last day of the period.
The yield of each Subaccount reflects the deduction of all recurring fees and charges applicable to the Subaccount, such as the Risk Charge, and the asset-based Administrative Fee and the Annual Fee (assuming an average Contract Value of $100,000), but does not reflect any withdrawal charge, charge for applicable premium taxes and/or any other taxes, increase in the Risk Charge for an optional Death Benefit Rider, any living benefit rider charge, or any non-recurring fees or charges.
The Subaccounts’ yields will vary from time to time depending upon market conditions, the composition of each Portfolio and operating expenses of the Fund allocated to each Portfolio. Consequently, any given performance quotation should not be considered representative of the Subaccount’s performance in the future. Yield should also be considered relative to changes in Subaccount Unit Values and to the relative risks associated with the investment policies and objectives of the various Portfolios. In addition, because performance will fluctuate, it may not provide
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a basis for comparing the yield of a Subaccount with certain bank deposits or other investments that pay a fixed yield or return for a stated period of time.
Performance Comparisons and Benchmarks
In advertisements and sales literature, we may compare the performance of some or all of the Subaccounts to the performance of other variable annuity issuers in general and to the performance of particular types of variable annuities investing in mutual funds, or series of mutual funds, with investment objectives similar to each of the Subaccounts. This performance may be presented as averages or rankings compiled by Lipper Analytical Services, Inc. (“Lipper”), or Morningstar, Inc. (“Morningstar”), which are independent services that monitor and rank the performance of variable annuity issuers and mutual funds in each of the major categories of investment objectives on an industry-wide basis. Lipper’s rankings include variable life issuers as well as variable annuity issuers. The performance analyses prepared by Lipper and Morningstar rank such issuers on the basis of total return, assuming reinvestment of dividends and distributions, but do not take sales charges, redemption fees or certain expense deductions at the separate account level into consideration. In addition, Morningstar prepares risk adjusted rankings, which consider the effects of market risk on total return performance. We may also compare the performance of the Subaccounts with performance information included in other publications and services that monitor the performance of insurance company separate accounts or other investment vehicles. These other services or publications may be general interest business publications such as The Wall Street Journal, Barron’s, Business Week, Forbes, Fortune, and Money.
In addition, our reports and communications to Contract Owners, advertisements, or sales literature may compare a Subaccount’s performance to various benchmarks that measure the performance of a pertinent group of securities widely regarded by investors as being representative of the securities markets in general or as being representative of a particular type of security. We may also compare the performance of the Subaccounts with that of other appropriate indices of investment securities and averages for peer universes of funds or data developed by us derived from such indices or averages. Unmanaged indices generally assume the reinvestment of dividends or interest but do not generally reflect deductions for investment management or administrative costs and expenses.
Tax Deferred Accumulation
In reports or other communications to you or in advertising or sales materials, we may also describe the effects of tax-deferred compounding on the Separate Account’s investment returns or upon returns in general. These effects may be illustrated in charts or graphs and may include comparisons at various points in time of returns under the Contract or in general on a tax-deferred basis with the returns on a taxable basis. Different tax rates may be assumed.
In general, individuals who own annuity contracts are not taxed on increases in the value under the annuity contract until some form of distribution is made from the contract (Non-Natural Persons as Owners may not receive tax deferred accumulation). Thus, the annuity contract will benefit from tax deferral during the accumulation period, which generally will have the effect of permitting an investment in an annuity contract to grow more rapidly than a comparable investment under which increases in value are taxed on a current basis. The following chart illustrates this benefit by comparing accumulation under a variable annuity contract with accumulations from an investment on which gains are taxed on a current ordinary income basis.
The chart shows a single Purchase Payment of $10,000, assuming hypothetical annual returns of 0%, 4% and 8%, compounded annually, and a tax rate of 32%. The values shown for the taxable investment do not include any deduction for management fees or other expenses but assume that taxes are deducted annually from investment returns. The values shown for the variable annuity do not reflect the Risk Charge, and the asset-based Administrative Fee and the Annual Fee (assuming an average Contract Value of $100,000), any withdrawal charge, charge for applicable premium taxes and/or any other taxes, increase in the Risk Charge for an optional Death Benefit Rider, any living benefit rider charge, or any underlying Fund expenses.
If above expenses and fees were taken into account, they would reduce the investment return shown for both the taxable investment and the hypothetical variable annuity contract. In addition, these values assume that you do not surrender the Contract or make any withdrawals until the end of the period shown. The chart assumes a full withdrawal, at the end of the period shown, of all Contract Value and the payment of taxes at the 32% rate on the amount in excess of the Purchase Payment.
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The rates of return illustrated are hypothetical and are not an estimate or guarantee of performance. Actual tax rates may vary for different assets (e.g. capital gains and qualifying dividend income) and taxpayers from that illustrated. Withdrawals by and distributions to Contract Owners who have not reached age 59½ may be subject to a tax penalty of 10%.
$10,000 investment at annual rates of return of 0%, 4% and 8%, taxed @ 32%
Pacific Select Distributors, LLC (PSD)
Pacific Select Distributors, LLC, our subsidiary, acts as the distributor of the Contracts and offers the Contracts on a continuous basis. PSD is located at 700 Newport Center Drive, Newport Beach, California 92660. PSD is registered as a broker-dealer with the SEC and is a member of FINRA. We pay PSD for acting as distributor under a Distribution Agreement. We and PSD enter into selling agreements with broker-dealers whose financial professionals are authorized by state insurance departments to solicit applications for the Contracts. Because this Contract was not offered before 2021, PSD was not paid any underwriting commissions with regard to this Contract.
PSD or an affiliate pays various sales compensation to broker-dealers that solicit applications for the Contracts. PSD or an affiliate also may provide reimbursement for other expenses associated with the promotion and solicitation of applications for the Contracts. Your financial professional typically receives a portion of the compensation that is payable to his or her broker-dealer in connection with the Contract, depending on the agreement between your financial professional and his or her firm. Pacific Life is not involved in determining that compensation arrangement, which may present its own incentives or conflicts. You may ask your financial professional how he/she will personally be compensated for the transaction.
Under certain circumstances where PSD pays lower initial commissions, certain broker-dealers that solicit applications for Contracts may be paid an ongoing persistency trail commission (sometimes called a residual). The mix of Purchase Payment-based versus trail commissions varies depending upon our agreement with the selling broker-dealer and the commission option selected by your financial professional or broker-dealer.
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In addition to the Purchase Payment-based and trail commissions described above, we and/or an affiliate may pay additional cash compensation from our own resources in connection with the promotion and solicitation of applications for the Contracts by some, but not all, broker-dealers. The range of additional cash compensation based on Purchase Payments generally does not exceed 0.40% and trailing compensation based on Account Value generally does not exceed 0.15% on an annual basis. Such additional compensation may give Pacific Life greater access to financial professionals of the broker-dealers that receive such compensation. While this greater access provides the opportunity for training and other educational programs so that your financial professional may serve you better, this additional compensation also may afford Pacific Life a “preferred” status at the recipient broker-dealer and provide some other marketing benefit such as website placement, access to financial professional lists, extra marketing assistance or other heightened visibility and access to the broker-dealer’s sales force that otherwise influences the way that the broker-dealer and the financial professional market the Contracts.
As of December 31, 2020, the following firms have arrangements in effect with the Distributor pursuant to which the firm is entitled to receive a revenue sharing payment:
American Portfolios Financial Services Inc., Ameriprise Financial Services Inc., Bancwest Investment Services Inc., B B V A Securities Inc., Bok Financial Securities Inc, Cadaret, Grant & Co., Cambridge Investment Research Inc, Citizens Securities Inc, C U N A Brokerage Services Inc., C U S O Financial Services LP, Capital One Investing, Cetera Advisors LLC, Cetera Advisors Network LLC, Cetera Financial Institutions, Cetera Financial Specialists, Citigroup Global Markets Inc., CMS Investment Resources LLC, Commonwealth Financial Network, Edward D. Jones & Co., LP, Ensemble Financial Services Inc., The Enterprise Securities Co., Essex Financial Services Inc., F S C Securities Corporation, Fifth Third Securities Inc., Financial Advisors, First Allied Securities Inc., First Heartland Capital Inc., FTB Advisors Inc., Geneos Wealth Management Inc., Hancock Investment Services, H.Beck Inc., Horan Securities Inc., Independent Financial Group, Infinex Investments Inc., Investacorp Inc., Investment Professionals Inc., J J B Hilliard, Jacques Financial LLC, Janney Montgomery Scott Inc., Key Investment Services LLC, Kestra Investment Services, KMS Financial Service, L P L Financial LLC, Lincoln Financial Advisors Corp., Lincoln Financial Securities Corp., M Holdings Securities Inc., M M L Investors Services Inc., Meridian Financial Group Inc., Morgan Stanley & Co. Incorporated, Mutual Of Omaha Investor Services Inc., Navy Federal Brokerage, NEXT Financial Group Inc., Oppenheimer & CO. Inc, Park Avenue Securities LLC., PNC Investments Inc., ProEquities Inc., Questar Capital Corporation, R B C Capital Markets Corporation, Raymond James & Associates Inc., Raymond James Financial Services Inc., Robert W Baird & Company Inc., Royal Alliance Associates Inc., Sagepoint Financial Inc., Santander Securities LLC, Securian Financial Services Inc., Securities America Inc., Securities Service Network, Signator Investors Inc., Sorrento Pacific Financial LLC, Stephens Inc., Stifel Nicolaus & Company Inc., Summit Brokerage Services Inc., The Huntington Bank, The Huntington Investment, Transamerica Financial Advisors Inc., Triad Advisors Inc., U B S Financial Services Inc., U S Bancorp Investments Inc., Unionbanc Investment Services LLC, United Planners’ Financial Services of America, VOYA Financial Advisors, W L Lyons Inc., Wells Fargo Advisors LLC, Wells Fargo Investments LLC, Wescom Financial Services LLC, Woodbury Financial Services Inc.
We or our affiliates may also pay override payments, expense allowances and reimbursements, bonuses, wholesaler fees, and training and marketing allowances. Such payments may offset the broker-dealer’s expenses in connection with activities that it is required to perform, such as educating personnel and maintaining records. Financial professionals may also receive non-cash compensation, such as expense-paid educational or training seminars involving travel within and outside the U.S. or promotional merchandise.
All of the compensation described in this section, and other compensation or benefits provided by us or our affiliates, may be more or less than the overall compensation on similar or other products and may influence your financial professional or broker-dealer to present this Contract over other investment options. You may ask your financial professional about these potential conflicts of interest and how he/she and his/her broker-dealer are compensated for selling the Contract.
Portfolio Managers of the underlying Portfolios available under this Contract may from time to time bear all or a portion of the expenses of conferences or meetings sponsored by Pacific Life or PSD that are attended by, among others, representatives of PSD, who would receive information and/or training regarding the Fund’s Portfolios and their management by the Portfolio Managers in addition to information regarding the variable annuity and/or life insurance products issued by Pacific Life and its affiliates. Other persons may also attend all or a portion of any such conferences or meetings, including directors, officers and employees of Pacific Life, officers and trustees of Pacific Select Fund, and spouses/guests of the foregoing. The Pacific Select Fund Board of Trustees may hold meetings
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concurrently with such a conference or meeting. The Pacific Select Fund pays for the expenses of the meetings of its Board of Trustees, including the pro rata share of expenses for attendance by the Trustees at the concurrent conferences or meetings sponsored by Pacific Life or PSD. Additional expenses and promotional items may be paid for by Pacific Life and/or Portfolio Managers. PSD serves as the Pacific Select Fund Distributor.
THE CONTRACTS AND THE SEPARATE ACCOUNT
Pursuant to Commodity Futures Trading Commission Rule 4.5, Pacific Life has claimed an exclusion from the definition of the term “commodity pool operator” under the Commodity Exchange Act. Therefore, it is not subject to registration or regulation as a commodity pool operator under the Commodity Exchange Act.
Calculating Subaccount Unit Values
The Unit Value of the Subaccount Units in each Variable Investment Option is computed at the close of the New York Stock Exchange, which is usually 4:00 p.m. Eastern time on each Business Day. The initial Unit Value of each Subaccount was $10 on the Business Day the Subaccount began operations. At the end of each Business Day, the Unit Value for a Subaccount is equal to:
Y × Z
where (Y) = the Unit Value for that Subaccount as of the end of the preceding Business Day; and
(Z) = the Net Investment Factor for that Subaccount for the period (a “valuation period”) between that Business Day and the immediately preceding Business Day.
The “Net Investment Factor” for a Subaccount for any valuation period is equal to:
(A ÷ B) - C
where (A) = the “per share value of the assets” of that Subaccount as of the end of that valuation period, which is equal to: a+b+c
where (a) = the net asset value per share of the corresponding Portfolio shares held by that Subaccount as of the end of that valuation period;
(b) = the per share amount of any dividend or capital gain distributions made by the Fund for that Portfolio during that valuation period; and
(c) = any per share charge (a negative number) or credit (a positive number) for any income taxes or other amounts set aside during that valuation period as a reserve for any income and/or any other taxes which we determine to have resulted from the operations of the Subaccount or Contract, and/or any taxes attributable, directly or indirectly, to Investments;
(B) = the net asset value per share of the corresponding Portfolio shares held by the Subaccount as of the end of the preceding valuation period; and
(C) = a factor that assesses against the Subaccount net assets for each calendar day in the valuation period, the basic Risk Charge plus the Administrative Fee and any applicable increase in the Risk Charge (see the CHARGES, FEES AND DEDUCTIONS section in the Prospectus).
As explained in the Prospectus, the Annual Fee, if applicable, will be charged proportionately against your Investment Options. Assessments against your Variable Investment Options are assessed against your Variable Account Value through the automatic debit of Subaccount Units; the Annual Fee decreases the number of Subaccount Units attributed to your Contract but does not alter the Unit Value for any Subaccount.
Variable Annuity Payment Amounts
The following steps show how we determine the amount of each variable annuity payment under your Contract.
First: Pay Applicable Premium Taxes
When you convert any portion of your Contract Value into annuity payments, you must pay any applicable charge for premium taxes and/or other taxes on your Contract Value (unless applicable law requires those taxes to be paid
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at a later time). We assess this charge by reducing your Account Value proportionately, relative to your Account Value in each Subaccount and in any fixed option, in an amount equal to the aggregate amount of the charges. The remaining amount of your available Contract Value may be used to provide variable annuity payments. Alternatively, your remaining available Contract Value may be used to provide fixed annuity payments, or it may be divided to provide both fixed and variable annuity payments. You may also choose to withdraw some or all of your remaining Contract Value, less any applicable Annual Fees, any living benefit rider charge, and/or withdrawal charge, and any charges for premium taxes and/or other taxes without converting this amount into annuity payments.
Second: The First Variable Payment
We begin by referring to your Contract’s Option Table for your Annuity Option (the “Annuity Option Table”). The Annuity Option Table allows us to calculate the dollar amount of the first variable annuity payment under your Contract, based on the amount applied toward the variable annuity. The number that the Annuity Option Table yields will be based on the Annuitant’s age (and, in certain cases, sex) and assumes a 4% rate of return, as described in more detail below.
Example: Assume a man is 65 years of age at his Annuity Date and has selected a lifetime annuity with monthly payments guaranteed for 10 years. According to the Annuity Option Table, this man should receive an initial monthly payment of $4.99 for every $1,000 of his Contract Value (reduced by applicable charges) that he will be using to provide variable payments. Therefore, if his Contract Value after deducting applicable fees and charges is $100,000 on his Annuity Date and he applies this entire amount toward his variable annuity, his first monthly payment will be $499.00.
You may choose any other Annuity Option Table that assumes a different rate of return which we offer at the time your Annuity Option is effective.
Third: Subaccount Annuity Units
For each Subaccount, we use the amount of the first variable annuity payment under your Contract attributed to each Subaccount to determine the number of Subaccount Annuity Units that will form the basis of subsequent payment amounts. First, we use the Annuity Option Table to determine the amount of that first variable payment for each Subaccount. Then, for each Subaccount, we divide that amount of the first variable annuity payment by the value of one Subaccount Annuity Unit (the “Subaccount Annuity Unit Value”) as of the end of the Annuity Date to obtain the number of Subaccount Annuity Units for that particular Subaccount. The number of Subaccount Annuity Units used to calculate subsequent payments under your Contract will not change unless exchanges of Annuity Units are made, (or if the Joint and Survivor Annuity Option is elected and the Primary Annuitant dies first) but the value of those Annuity Units will change daily, as described below.
Fourth: The Subsequent Variable Payments
The amount of each subsequent variable annuity payment will be the sum of the amounts payable based on each Subaccount. The amount payable based on each Subaccount is equal to the number of Subaccount Annuity Units for that Subaccount multiplied by their Subaccount Annuity Unit Value at the end of the Business Day in each payment period you elected that corresponds to the Annuity Date.
Each Subaccount’s Subaccount Annuity Unit Value, like its Subaccount Unit Value, changes each day to reflect the net investment results of the underlying investment vehicle, as well as the assessment of the Risk Charge at an annual rate of 0.70% and the Administrative Fee at an annual rate of 0.25%. In addition, the calculation of Subaccount Annuity Unit Value incorporates an additional factor; as discussed in more detail below, this additional factor adjusts Subaccount Annuity Unit Values to correct for the Option Table’s implicit assumed annual investment return on amounts applied but not yet used to furnish annuity benefits. Any increase in your Risk Charge for an optional death benefit rider is not charged after the Annuity Date.
Different Subaccounts may be selected for your Contract before and after your Annuity Date, subject to any restrictions we may establish. Currently, you may exchange Subaccount Annuity Units in any Subaccount for Subaccount Annuity Units in any other Subaccount(s) up to four times in any twelve month period after your Annuity Date. The number of Subaccount Annuity Units in any Subaccount may change due to such exchanges. Exchanges following your Annuity Date will be made by exchanging Subaccount Annuity Units of equivalent aggregate value, based on their relative Subaccount Annuity Unit Values.
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Understanding the “Assumed Investment Return” Factors
The Annuity Option Table incorporates a number of implicit assumptions in determining the amount of your first variable annuity payment. As noted above, the numbers in the Annuity Option Table reflect certain actuarial assumptions based on the Annuitant’s age, and, in some cases, the Annuitant’s sex. In addition, these numbers assume that the amount of your Contract Value that you convert to a variable annuity will have a positive net investment return of 4% each year during the payout of your annuity; thus 4% is referred to as an “assumed investment return.”
The Subaccount Annuity Unit Value for a Subaccount will increase only to the extent that the investment performance of that Subaccount exceeds the Risk Charge, the Administrative Fee, and the assumed investment return. The Subaccount Annuity Unit Value for any Subaccount will generally be less than the Subaccount Unit Value for that same Subaccount, and the difference will be the amount of the assumed investment return factor.
Assume the net investment performance of a Subaccount is at a rate of 4.00% per year (after deduction of the 0.70% Risk Charge and the 0.25% Administrative Fee). The Subaccount Unit Value for that Subaccount would increase at a rate of 4.00% per year, but the Subaccount Annuity Unit Value would not increase (or decrease) at all. The net investment factor for that 4% return [1.04] is then divided by the factor for the 4% assumed investment return [1.04] and 1 is subtracted from the result to determine the adjusted rate of change in Subaccount Annuity Unit Value:
1.04 | = 1; 1 - 1 = 0; 0 x 100% = 0%. |
1.04 |
If the net investment performance of a Subaccount’s assets is at a rate less than 4.00% per year, the Subaccount Annuity Unit Value will decrease, even if the Subaccount Unit Value is increasing.
Assume the net investment performance of a Subaccount is at a rate of 2.60% per year (after deduction of the 0.70% Risk Charge and the 0.25% Administrative Fee). The Subaccount Unit Value for that Subaccount would increase at a rate of 2.60% per year, but the Subaccount Annuity Unit Value would decrease at a rate of 1.35% per year. The net investment factor for that 2.6% return [1.026] is then divided by the factor for the 4% assumed investment return [1.04] and 1 is subtracted from the result to determine the adjusted rate of change in Subaccount Annuity Unit Value:
1.026 | = 0.9865; 0.9865 – 1 = -0.0135; -0.0135 × 100% = -1.35%. |
1.04 |
The assumed investment return will always cause increases in Subaccount Annuity Unit Values to be somewhat less than if the assumption had not been made, will cause decreases in Subaccount Annuity Unit Values to be somewhat greater than if the assumption had not been made, and will (as shown in the example above) sometimes cause a decrease in Subaccount Annuity Unit Values to take place when an increase would have occurred if the assumption had not been made. If we had assumed a higher investment return in our Annuity Option tables, it would produce annuities with larger first payments, but the increases in subaccount annuity payments would be smaller and the decreases in subsequent annuity payments would be greater; a lower assumed investment return would produce annuities with smaller first payments, and the increases in subsequent annuity payments would be greater and the decreases in subsequent annuity payments would be smaller.
Redemptions of Remaining Guaranteed Variable Payments Under Options 2, 4, and Joint Life with Period Certain
If variable payments are elected under Annuity Options 2 and 4 (Life with Period Certain and Period Certain Only, respectively), or Joint Life with Period Certain, you may redeem all remaining guaranteed variable payments after the Annuity Date. Also, under Option 4, partial redemptions of remaining guaranteed variable payments after the Annuity Date are available. If you elect to redeem all remaining guaranteed variable payments in a single sum, we will not make any additional variable annuity payments during the remaining guaranteed period after the redemption. If Annuity Option 2 or Joint Life with Period Certain was elected and the Annuitant is alive at the end
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of the guaranteed period, annuity payments will resume until the Annuitant’s death. The amount available upon full redemption would be the present value of any remaining guaranteed variable payments at the assumed investment return. Any applicable withdrawal charge will be deducted from the present value as if you made a full withdrawal, or if applicable, a partial withdrawal. For purposes of calculating the withdrawal charge and Free Withdrawal amount, it will be assumed that the Contract was never converted to provide annuity payments and any prior variable annuity payments in that Contract Year will be treated as if they were partial withdrawals from the Contract (see the CHARGES, FEES AND DEDUCTIONS—Withdrawal Charge section in the Prospectus). If you have a Qualified Contract, there may be adverse tax implications if you elect to redeem any remaining variable payments in a single sum. Work with your tax advisor before making such an election. For example, assume that a Contract was issued with a single investment of $10,000 and in Contract Year 4 the Owner elects to receive variable annuity payments under Annuity Option 4. In Contract Year 5, the Owner elects to make a partial redemption of $5,000. The withdrawal charge as a percentage of the Purchase Payments with an age of 5 years is 5%. Assuming the Free Withdrawal amount immediately prior to the partial redemption is $300, the withdrawal charge for the partial redemption will be $235 (($5,000 - $300) * 5%). No withdrawal charge will be imposed on a redemption if:
· the Annuity Option is elected as the form of payments of death benefit proceeds, or
· the Annuitant dies before the period certain has ended and the Beneficiary requests a redemption of the variable annuity payments.
The variable payment amount we use in calculating the present value is determined by summing an amount for each Subaccount, which we calculate by multiplying your Subaccount Annuity Units by the Annuity Unit Value next computed after we receive your redemption request. This variable payment amount is then discounted at the assumed investment return from each future Annuity Payment date that falls within the payment guaranteed period. The sum of these discounted remaining variable payment amounts is the present value of remaining guaranteed variable payments.
If you elect to redeem all remaining guaranteed variable payments in a single sum, we will not make any additional variable annuity payments during the remaining guaranteed period after the redemption.
If you elect to redeem a portion of the remaining guaranteed variable payments in a single sum, we will reduce the number of Annuity Units for each Subaccount by the same percentage as the partial redemption value bears to the amount available upon a full redemption.
Redemption of remaining guaranteed variable payments will not affect the amount of any fixed annuity payments.
If any transaction or event under your Contract is scheduled to occur on a “corresponding date” that does not exist in a given calendar period, the transaction or event will be deemed to occur on the following Business Day. In addition, as stated in the Prospectus, any event scheduled to occur on a day that is not a Business Day will occur on the next succeeding Business Day.
Example: If your Contract is issued on February 29 in year 1 (a leap year), your Contract Anniversary in years 2, 3 and 4 will be on March 1.
Example: If your Annuity Date is July 31, and you select monthly annuity payments, the payments received will be based on valuations made on July 31, August 31, October 1 (for September), October 31, December 1 (for November), December 31, January 31, March 1 (for February), March 31, May 1 (for April), May 31 and July 1 (for June).
Age and Sex of Owner and Annuitant
The Contracts generally provide for sex-distinct annuity income factors in the case of life annuities. Statistically, females tend to have longer life expectancies than males; consequently, if the amount of annuity payments is based on life expectancy, they will ordinarily be higher if an annuitant is male than if an annuitant is female. Certain states’ regulations prohibit sex-distinct annuity income factors, and Contracts issued in those states will use unisex factors. In addition, Contracts issued in connection with certain Qualified Plans are required to use unisex factors.
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We may require proof of your Annuitant’s age and/or sex before or after commencing annuity payments. If the age or sex (or both) of your Annuitant are incorrectly stated in your Contract, we will correct the amount payable to equal the amount that the annuitized portion of the Contract Value under that Contract would have purchased for your Annuitant’s correct age and sex. If we make the correction after annuity payments have started, and we have made overpayments based on the incorrect information, we will deduct the amount of the overpayment, with interest as stated in your Contract, from any payments due then or later; if we have made underpayments, we will add the amount, with interest as stated in your Contract, of the underpayments to the next payment we make after we receive proof of the correct age and/or sex.
Additionally, we may require proof of the Annuitant’s or Owner’s age and/or sex before any payments associated with the Death Benefit provisions of your Contract are made. If the age or sex is incorrectly stated in your Contract, we will base any payment associated with the Death Benefit provisions on your Contract on the Annuitant’s or Owner’s correct age or sex.
The fixed option(s) are not available in connection with portfolio rebalancing. You may not use dollar cost averaging, or DCA Plus at the same time. In addition, no fixed option(s) may be used as the target Investment Option under any systematic transfer program.
Dollar Cost Averaging
When you request dollar cost averaging, you are authorizing us to make periodic reallocations of your Contract Value without waiting for any further instruction from you. You may request to begin or stop dollar cost averaging at any time prior to your Annuity Date; the effective date of your request will be the day we receive notice from you In Proper Form. Your request may specify the date on which you want your first transfer to be made. Your first transfer may not be made until 30 days after your Contract Date, and if you specify an earlier date, your first transfer will be delayed until one calendar month after the date you specify. If you request dollar cost averaging on your application for your Contract and you fail to specify a date for your first transfer, your first transfer will be made one period after your Contract Date (that is, if you specify monthly transfers, the first transfer will occur 30 days after your Contract Date; quarterly transfers, 90 days after your Contract Date; semi-annual transfers, 180 days after your Contract Date; and if you specify annual transfers, the first transfer will occur on your Contract Anniversary). If you stop dollar cost averaging, you must wait 30 days before you may begin this option again. Currently, we are not enforcing the 30 day waiting periods but we reserve the right to enforce such waiting periods in the future. We will provide at least a 30 day prior notice before we enforce the 30 day waiting periods.
Your request to begin dollar cost averaging must specify the Investment Option you wish to transfer money from (your “source account”). You may choose any one Investment Option as your source account. The Account Value of your source account must be at least $5,000 for you to begin dollar cost averaging. Currently, we are not enforcing the minimum Account Value but we reserve the right to enforce such minimum amounts in the future. We will provide at least a 30 day prior notice before we enforce the minimum Account Value requirement.
Your request to begin dollar cost averaging must also specify the amount and frequency of your transfers. You may choose monthly, quarterly, semiannual or annual transfers. The amount of your transfers may be specified as a dollar amount or a percentage of your source Account Value; however, each transfer must be at least $250. Currently, we are not enforcing the minimum transfer amount but we reserve the right to enforce such minimum amounts in the future. We will provide at least a 30 day prior notice before we enforce the minimum transfer amount. Dollar cost averaging transfers are not subject to the same requirements and limitations as other transfers.
Finally, your request must specify the Variable Investment Option(s) you wish to transfer amounts to (your “target account(s)”). If you select more than one target account, your dollar cost averaging request must specify how transferred amounts should be allocated among the target accounts. Your source account may not also be a target account.
Your dollar cost averaging transfers will continue until the earlier of:
· your request to stop dollar cost averaging is effective,
· your source Account Value is zero,
· your transfer amount is greater than the source Account Value, or
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· your Annuity Date.
If, as a result of a dollar cost averaging transfer, your source Account Value falls below any minimum Account Value we may establish, we have the right, at our option, to transfer that remaining Account Value to your target account(s) on a proportionate basis relative to your most recent allocation instructions. We may change, terminate or suspend the dollar cost averaging option at any time.
Portfolio Rebalancing
Portfolio rebalancing allows you to maintain the percentage of your Contract Value allocated to each Variable Investment Option at a pre-set level prior to annuitization.
For example, you could specify that 30% of your Contract Value should be in Subaccount A, 40% in Subaccount B, and 30% in Subaccount C.
Over time, the variations in each Subaccount’s investment results will shift this balance of these Subaccount Value allocations. If you elect the portfolio rebalancing feature, we will automatically transfer your Subaccount Value back to the percentages you specify.
You may choose to have rebalances made quarterly, semi-annually or annually. Any Investment Options not selected for portfolio rebalancing will not be rebalanced.
Procedures for selecting portfolio rebalancing are generally the same as those discussed in detail above for selecting dollar cost averaging: You may make your request at any time prior to your Annuity Date and it will be effective when we receive it In Proper Form. If you stop portfolio rebalancing, you must wait 30 days to begin again. Currently, we are not enforcing the 30-day waiting period but we reserve the right to enforce such waiting period in the future. If you request rebalancing on your application but do not specify a date for the first rebalance, it will occur one period after your Contract Date, as described above under Dollar Cost Averaging. We may change, terminate or suspend the portfolio rebalancing feature at any time. Portfolio rebalancing will stop on the Annuity Date.
You may specify a dollar amount for your pre-authorized withdrawals, or you may specify a percentage of your Contract Value or living benefit rider, if applicable. You may direct us to make your pre-authorized withdrawals from one or more specific Investment Options. If you do not give us these specific instructions, amounts will be deducted proportionately from your Account Value in each Investment Option.
Procedures for selecting pre-authorized withdrawals are generally the same as those discussed in detail above for selecting dollar cost averaging and portfolio rebalancing: You may make your request at any time and it will be effective when we receive it In Proper Form. If you stop the pre-authorized withdrawals, you must wait 30 days to begin again. Currently, we are not enforcing the 30-day waiting period but we reserve the right to enforce such waiting period in the future. We will provide at least a 30 day prior notice before we enforce the 30-day waiting period.
Pre-authorized withdrawals are subject to the same withdrawal charges as are other withdrawals and each withdrawal is subject to any applicable charge for premium taxes and/or other taxes, to federal income tax on its taxable portion, and, if you have not reached age 59½, may be subject to a 10% federal tax penalty.
Section 817(h) of the Code provides that the investments underlying a variable annuity must satisfy certain diversification requirements. Details on these diversification requirements generally appear in the Fund SAIs. We believe the underlying Variable Investment Options for the Contract meet these requirements. On March 7, 2008, the Treasury Department issued Final Regulations under Section 817(h). These Final Regulations do not provide guidance concerning the extent to which you may direct your investments to particular divisions of a separate account. Such guidance may be included in regulations or revenue rulings under Section 817(d) relating to the definition of a variable contract. We reserve the right to make such changes as we deem necessary or appropriate to ensure that your Contract continues to qualify as an annuity for tax purposes. Any such changes will apply uniformly to affected Contract Owners and will be made with such notice to affected Contract Owners as is feasible under the circumstances.
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For a variable life insurance contract or a variable annuity contract to qualify for tax deferral, assets in the separate accounts supporting the contract must be considered to be owned by the insurance company and not by the contract owner. Under current U.S. tax law, if a contract owner has excessive control over the investments made by a separate account, or the underlying fund, the contract owner will be taxed currently on income and gains from the account or fund. In other words, in such a case of “investor control” the contract owner would not derive the tax benefits normally associated with variable life insurance or variable annuities.
Generally, according to the IRS, there are two ways that impermissible investor control may exist. The first relates to the design of the contract or the relationship between the contract and a separate account or underlying fund. For example, at various times, the IRS has focused on, among other factors, the number and type of investment choices available pursuant to a given variable contract, whether the contract offers access to funds that are available to the general public, the number of transfers that a contract owner may make from one investment option to another, and the degree to which a contract owner may select or control particular investments.
With respect to this first aspect of investor control, we believe that the design of our contracts and the relationship between our contracts and the Portfolios satisfy the current view of the IRS on this subject, such that the investor control doctrine should not apply. However, because of some uncertainty with respect to this subject and because the IRS may issue further guidance on this subject, we reserve the right to make such changes as we deem necessary or appropriate to reduce the risk that your contract might not qualify as a life insurance contract or as an annuity for tax purposes.
The second way that impermissible investor control might exist concerns your actions. Under case law and IRS guidance, you may not select or control particular investments, other than choosing among broad investment choices such as selecting a particular Portfolio. You may not select or direct the purchase or sale of a particular investment of a Separate Account, a Subaccount (or Variable Investment Option), or a Portfolio. All investment decisions concerning the Separate Accounts and the Subaccounts must be made by us, and all investment decisions concerning the underlying Portfolios must be made by the portfolio manager for such Portfolio in his or her sole and absolute discretion, and not by the contract owner. Furthermore, you may not enter into an agreement or arrangement with a portfolio manager of a Portfolio or communicate directly or indirectly with such a portfolio manager or any related investment officers concerning the selection, quality, or rate of return of any specific investment or group of investments held by a Portfolio, and you may not enter into any such agreement or arrangement or have any such communication with us or the portfolio manager of a Portfolio.
Finally, the IRS may issue additional guidance on the investor control doctrine, which might further restrict your actions or features of the variable contract. Such guidance could be applied retroactively. If any of the rules outlined above are not complied with, the IRS may seek to tax you currently on income and gains from a Portfolio such that you would not derive the tax benefits normally associated with variable life insurance or variable annuities. Although highly unlikely, such an event may have an adverse impact on the fund and other variable contracts. We urge you to consult your own tax advisor with respect to the application of the investor control doctrine.
We are responsible for the safekeeping of the assets of the Separate Account. These assets are held separate and apart from the assets of our General Account and our other separate accounts.
The financial statements of Separate Account A of Pacific Life as of December 31, 2020 and for each of the periods presented are included in this SAI. Pacific Life’s consolidated financial statements as of December 31, 2020 and 2019 and for each of the three years in the period ended December 31, 2020 are included in this SAI. These financial statements should be considered only as bearing on the ability of Pacific Life to meet its obligations under the Contracts and not as bearing on the investment performance of the assets held in the Separate Account.
INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM
AND INDEPENDENT AUDITORS
The financial statements of Separate Account A of Pacific Life Insurance Company as of December 31, 2020 and for each of the periods presented have been audited by Deloitte & Touche LLP, independent registered public
12
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accounting firm, as stated in their report appearing herein, and is included in reliance upon the report of such firm given upon their authority as experts in accounting and auditing.
The consolidated financial statements of Pacific Life Insurance Company and Subsidiaries as of December 31, 2020 and 2019 and for each of the three years in the period ended December 31, 2020 have been audited by Deloitte & Touche LLP, independent auditors, as stated in their report appearing herein, and is included in reliance upon the report of such firm given upon their authority as experts in accounting and auditing.
The business address of Deloitte & Touche LLP is 695 Town Center Drive, Costa Mesa, CA 92626.
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Form No. PCISAI-0521
SEPARATE ACCOUNT A
Investments |
SA-1 |
Financial Statements: |
|
Statements of Assets and Liabilities |
SA-3 |
Statements of Operations |
SA-12 |
Statements of Changes in Net Assets |
SA-18 |
Financial Highlights |
SA-36 |
Notes to Financial Statements |
SA-48 |
Report of Independent Registered Public Accounting Firm |
SA-55 |
SEPARATE ACCOUNT A
INVESTMENTS
Each variable account invests in shares of the corresponding portfolio or fund (with the same name). The shares owned and value of investments as of December 31, 2020; and the cost of purchases and proceeds from sales of investments for the year or period ended December 31, 2020, were as follows:
|
|
|
|
|
|
Cost of |
|
Proceeds |
| |||
Variable Accounts |
|
Shares Owned |
|
Value |
|
Purchases |
|
from Sales |
| |||
Core Income Class I * |
|
3,013,931 |
|
$ |
38,331,761 |
|
$ |
36,957,487 |
|
$ |
25,070,728 |
|
Diversified Bond Class I * |
|
18,524,455 |
|
225,525,843 |
|
60,752,426 |
|
36,488,770 |
| |||
Floating Rate Income Class I * |
|
10,149,272 |
|
133,791,351 |
|
17,677,294 |
|
53,503,098 |
| |||
High Yield Bond Class I * |
|
18,114,815 |
|
169,937,437 |
|
54,055,416 |
|
72,491,144 |
| |||
Inflation Managed Class I * |
|
14,531,759 |
|
181,599,783 |
|
26,431,430 |
|
32,938,225 |
| |||
Managed Bond Class I * |
|
27,033,697 |
|
403,574,498 |
|
69,946,928 |
|
78,063,538 |
| |||
Short Duration Bond Class I * |
|
33,427,363 |
|
359,491,596 |
|
114,965,105 |
|
109,259,772 |
| |||
Emerging Markets Debt Class I * |
|
1,397,805 |
|
18,135,519 |
|
4,880,235 |
|
6,994,130 |
| |||
Dividend Growth Class I * |
|
13,390,269 |
|
392,587,744 |
|
44,362,166 |
|
57,656,128 |
| |||
Equity Index Class I * |
|
13,016,127 |
|
1,207,544,808 |
|
131,083,946 |
|
151,613,529 |
| |||
Focused Growth Class I * |
|
4,168,129 |
|
219,366,676 |
|
43,152,632 |
|
60,807,780 |
| |||
Growth Class I * |
|
7,344,759 |
|
386,226,270 |
|
62,312,582 |
|
84,783,240 |
| |||
Large-Cap Growth Class I * |
|
14,281,492 |
|
292,562,123 |
|
68,027,033 |
|
68,345,052 |
| |||
Large-Cap Value Class I * |
|
7,353,220 |
|
200,556,647 |
|
20,615,614 |
|
36,060,725 |
| |||
Main Street® Core Class I * |
|
5,275,474 |
|
283,529,275 |
|
9,555,226 |
|
53,575,174 |
| |||
Mid-Cap Equity Class I * |
|
7,998,571 |
|
234,856,073 |
|
13,678,119 |
|
39,223,548 |
| |||
Mid-Cap Growth Class I * |
|
12,443,194 |
|
341,822,790 |
|
41,608,146 |
|
74,895,229 |
| |||
Mid-Cap Value Class I * |
|
3,957,747 |
|
85,400,568 |
|
12,506,909 |
|
27,366,975 |
| |||
Small-Cap Equity Class I * |
|
2,293,511 |
|
54,784,426 |
|
7,690,988 |
|
10,363,351 |
| |||
Small-Cap Growth Class I * |
|
4,718,225 |
|
155,142,029 |
|
24,351,353 |
|
41,599,372 |
| |||
Small-Cap Index Class I * |
|
8,619,530 |
|
265,840,145 |
|
31,140,108 |
|
42,835,748 |
| |||
Small-Cap Value Class I * |
|
4,756,795 |
|
108,115,842 |
|
14,312,918 |
|
23,230,693 |
| |||
Value Class I * |
|
10,971,296 |
|
176,476,171 |
|
21,579,590 |
|
31,770,925 |
| |||
Value Advantage Class I * |
|
2,459,950 |
|
46,723,715 |
|
13,440,849 |
|
8,316,915 |
| |||
Emerging Markets Class I * |
|
8,479,360 |
|
204,652,805 |
|
15,859,665 |
|
40,058,264 |
| |||
International Large-Cap Class I * |
|
22,521,081 |
|
270,335,105 |
|
19,058,162 |
|
39,270,879 |
| |||
International Small-Cap Class I * |
|
3,544,550 |
|
41,342,157 |
|
4,639,052 |
|
8,700,482 |
| |||
International Value Class I * |
|
8,809,550 |
|
104,399,243 |
|
13,039,643 |
|
16,331,267 |
| |||
Health Sciences Class I * |
|
5,543,277 |
|
319,282,109 |
|
38,952,707 |
|
70,351,234 |
| |||
Real Estate Class I * |
|
4,385,958 |
|
124,838,005 |
|
13,214,405 |
|
26,871,332 |
| |||
Technology Class I * |
|
14,377,231 |
|
208,730,778 |
|
65,130,862 |
|
65,706,282 |
| |||
PSF DFA Balanced Allocation Class D * |
|
19,132,967 |
|
287,805,519 |
|
50,933,676 |
|
18,262,278 |
| |||
Pacific Dynamix - Conservative Growth Class I * |
|
29,048,197 |
|
566,127,021 |
|
81,583,668 |
|
81,661,864 |
| |||
Pacific Dynamix - Moderate Growth Class I * |
|
98,899,557 |
|
2,492,893,673 |
|
115,106,181 |
|
248,731,331 |
| |||
Pacific Dynamix - Growth Class I * |
|
37,976,610 |
|
1,095,441,951 |
|
291,842,513 |
|
98,801,028 |
| |||
Portfolio Optimization Conservative Class I * |
|
102,406,618 |
|
1,534,709,404 |
|
389,112,033 |
|
395,131,050 |
| |||
Portfolio Optimization Moderate-Conservative Class I * |
|
127,525,591 |
|
2,134,134,639 |
|
65,699,604 |
|
327,520,239 |
| |||
Portfolio Optimization Moderate Class I * |
|
487,164,149 |
|
8,961,798,616 |
|
116,208,652 |
|
1,220,729,058 |
| |||
Portfolio Optimization Growth Class I * |
|
387,649,215 |
|
7,748,066,200 |
|
96,741,197 |
|
1,023,534,585 |
| |||
Portfolio Optimization Aggressive-Growth Class I * |
|
78,778,398 |
|
1,627,060,680 |
|
28,813,566 |
|
236,222,086 |
| |||
Invesco Oppenheimer V.I. Global Series II |
|
442,893 |
|
22,746,969 |
|
2,565,951 |
|
5,224,188 |
| |||
Invesco Oppenheimer V.I. International Growth Series II |
|
6,130,623 |
|
18,637,093 |
|
3,303,767 |
|
2,274,908 |
| |||
Invesco V.I. Balanced-Risk Allocation Series II |
|
30,602,896 |
|
314,903,796 |
|
56,582,005 |
|
51,690,439 |
| |||
Invesco V.I. Equity and Income Series II |
|
3,099,409 |
|
55,231,471 |
|
9,093,697 |
|
7,216,728 |
| |||
Invesco V.I. Global Real Estate Series II |
|
554,126 |
|
7,940,626 |
|
3,212,626 |
|
2,986,422 |
| |||
American Century VP Mid Cap Value Class II |
|
4,084,809 |
|
84,024,515 |
|
12,521,886 |
|
15,972,053 |
| |||
American Funds IS Asset Allocation Class 4 |
|
137,621,960 |
|
3,586,428,287 |
|
283,310,312 |
|
331,334,429 |
| |||
American Funds IS Blue Chip Income and Growth Class 4 |
|
10,311,202 |
|
144,975,493 |
|
30,268,247 |
|
19,305,895 |
| |||
American Funds IS Bond Class 4 |
|
10,191,026 |
|
119,133,092 |
|
62,717,857 |
|
20,417,749 |
| |||
American Funds IS Capital Income Builder® Class 4 |
|
10,038,941 |
|
108,922,508 |
|
16,072,611 |
|
18,341,773 |
| |||
American Funds IS Capital World Bond Class 4 |
|
1,586,672 |
|
20,166,607 |
|
5,703,169 |
|
2,724,344 |
| |||
American Funds IS Global Balanced Class 4 |
|
4,948,543 |
|
69,378,568 |
|
12,144,466 |
|
9,022,557 |
| |||
American Funds IS Global Growth and Income Class 4 |
|
3,308,559 |
|
54,094,946 |
|
11,066,599 |
|
4,896,130 |
| |||
See Notes to Financial Statements |
See explanation of symbol on page SA-2 |
SEPARATE ACCOUNT A
INVESTMENTS (Continued)
|
|
|
|
|
|
Cost of |
|
Proceeds |
| |||
Variable Accounts |
|
Shares Owned |
|
Value |
|
Purchases |
|
from Sales |
| |||
American Funds IS Global Growth Class 4 |
|
3,714,693 |
|
$ |
150,259,325 |
|
$ |
27,426,610 |
|
$ |
22,775,507 |
|
American Funds IS Global Small Capitalization Class 4 |
|
1,141,427 |
|
36,148,993 |
|
7,396,289 |
|
3,890,385 |
| |||
American Funds IS Growth Class 4 |
|
5,535,110 |
|
648,936,352 |
|
95,551,210 |
|
103,447,219 |
| |||
American Funds IS Growth-Income Class 4 |
|
7,528,810 |
|
406,480,454 |
|
48,050,668 |
|
62,206,964 |
| |||
American Funds IS High-Income Bond Class 4 |
|
3,353,807 |
|
35,349,126 |
|
15,011,326 |
|
11,591,392 |
| |||
American Funds IS International Class 4 |
|
4,355,840 |
|
101,273,286 |
|
12,698,874 |
|
14,937,196 |
| |||
American Funds IS International Growth and Income Class 4 |
|
3,112,217 |
|
58,571,925 |
|
8,411,018 |
|
7,852,430 |
| |||
American Funds IS Managed Risk Asset Allocation Class P2 |
|
12,053,083 |
|
162,113,969 |
|
37,044,446 |
|
20,413,069 |
| |||
American Funds IS New World Fund® Class 4 |
|
2,195,578 |
|
68,150,757 |
|
10,007,565 |
|
11,353,110 |
| |||
American Funds IS U.S. Government/AAA-Rated Securities Class 4 |
|
9,005,024 |
|
115,984,711 |
|
154,620,835 |
|
93,108,671 |
| |||
BlackRock® 60/40 Target Allocation ETF V.I. Class I |
|
8,079,691 |
|
110,853,359 |
|
45,323,855 |
|
7,000,809 |
| |||
BlackRock® Capital Appreciation V.I. Class III |
|
4,087,896 |
|
41,083,359 |
|
5,181,617 |
|
11,180,957 |
| |||
BlackRock® Global Allocation V.I. Class III |
|
98,754,655 |
|
1,608,713,335 |
|
142,813,513 |
|
242,060,790 |
| |||
Fidelity® VIP Contrafund® Service Class 2 |
|
6,279,341 |
|
293,433,606 |
|
43,420,717 |
|
55,391,815 |
| |||
Fidelity® VIP FundsManager® 60% Service Class 2 |
|
32,265,786 |
|
364,926,040 |
|
56,300,515 |
|
37,054,487 |
| |||
Fidelity® VIP Government Money Market Service Class |
|
482,684,674 |
|
482,684,674 |
|
598,826,883 |
|
428,254,425 |
| |||
Fidelity® VIP Strategic Income Service Class 2 |
|
7,455,405 |
|
87,079,133 |
|
23,305,990 |
|
17,522,578 |
| |||
First Trust Dorsey Wright Tactical Core Class I |
|
2,658,162 |
|
36,363,655 |
|
5,781,630 |
|
9,652,930 |
| |||
First Trust Multi Income Allocation Class I |
|
1,518,136 |
|
17,367,476 |
|
3,330,539 |
|
2,130,561 |
| |||
First Trust/Dow Jones Dividend & Income Allocation Class I |
|
43,994,104 |
|
662,991,144 |
|
87,589,243 |
|
87,776,069 |
| |||
Franklin Allocation VIP Class 2 |
|
4,764,420 |
|
25,870,800 |
|
8,454,605 |
|
2,413,038 |
| |||
Franklin Allocation VIP Class 4 |
|
47,868,833 |
|
269,022,839 |
|
83,432,674 |
|
40,645,299 |
| |||
Franklin Income VIP Class 2 |
|
3,588,550 |
|
53,971,796 |
|
12,214,995 |
|
11,191,043 |
| |||
Franklin Mutual Global Discovery VIP Class 2 |
|
11,151,809 |
|
188,577,098 |
|
28,557,121 |
|
31,259,652 |
| |||
Franklin Rising Dividends VIP Class 2 |
|
7,302,159 |
|
212,784,926 |
|
32,517,953 |
|
39,390,863 |
| |||
Templeton Global Bond VIP Class 2 |
|
5,602,199 |
|
77,422,394 |
|
19,327,683 |
|
22,151,607 |
| |||
Ivy VIP Asset Strategy Class II |
|
1,387,120 |
|
14,484,865 |
|
1,247,550 |
|
3,028,793 |
| |||
Ivy VIP Energy Class II |
|
7,712,366 |
|
19,133,608 |
|
22,077,908 |
|
15,536,352 |
| |||
Janus Henderson Balanced Service Shares |
|
92,023,183 |
|
4,242,268,733 |
|
883,043,383 |
|
212,534,350 |
| |||
Janus Henderson Flexible Bond Service Shares |
|
2,826,476 |
|
39,514,129 |
|
17,328,637 |
|
10,258,106 |
| |||
JPMorgan Insurance Trust Core Bond Class 1 |
|
14,722 |
|
174,893 |
|
3,827 |
|
25,025 |
| |||
JPMorgan Insurance Trust Global Allocation Class 2 |
|
662,615 |
|
13,073,398 |
|
1,244,584 |
|
1,557,428 |
| |||
JPMorgan Insurance Trust Income Builder Class 2 |
|
1,259,199 |
|
14,216,356 |
|
3,151,158 |
|
1,843,662 |
| |||
JPMorgan Insurance Trust Mid Cap Value Class 1 |
|
8,865 |
|
96,540 |
|
6,321 |
|
3,782 |
| |||
JPMorgan Insurance Trust U.S. Equity Class 1 |
|
632 |
|
23,635 |
|
1,378 |
|
1,026 |
| |||
ClearBridge Variable Aggressive Growth - Class II |
|
486,185 |
|
14,337,598 |
|
5,432,260 |
|
2,856,987 |
| |||
Lord Abbett Bond Debenture Class VC |
|
10,535,045 |
|
131,582,709 |
|
31,463,538 |
|
24,389,138 |
| |||
Lord Abbett Total Return Class VC |
|
17,471,193 |
|
303,125,202 |
|
50,007,510 |
|
50,507,958 |
| |||
MFS® Massachusetts Investors Growth Stock - Service Class |
|
3,293,975 |
|
81,262,367 |
|
9,919,175 |
|
16,656,213 |
| |||
MFS® Total Return Series - Service Class |
|
17,219,888 |
|
439,107,146 |
|
53,304,040 |
|
60,394,714 |
| |||
MFS® Utilities Series - Service Class |
|
1,568,926 |
|
54,426,040 |
|
13,620,676 |
|
18,279,165 |
| |||
MFS® Value Series - Service Class |
|
4,188,228 |
|
83,597,024 |
|
9,969,553 |
|
9,225,048 |
| |||
Neuberger Berman U.S. Equity Index PutWrite Strategy Class S |
|
159,937 |
|
1,648,955 |
|
562,897 |
|
363,436 |
| |||
PIMCO All Asset - Advisor Class |
|
220,745 |
|
2,474,547 |
|
2,488,730 |
|
310,578 |
| |||
PIMCO CommodityRealReturn® Strategy - Advisor Class |
|
1,408,225 |
|
8,632,420 |
|
2,376,315 |
|
1,155,076 |
| |||
PIMCO Income - Advisor Class |
|
475,787 |
|
5,238,410 |
|
6,956,197 |
|
1,887,275 |
| |||
Jennison Class II * |
|
1,007 |
|
122,126 |
|
— |
|
1,968 |
| |||
SP International Growth Class II * |
|
5,586 |
|
65,636 |
|
— |
|
3,978 |
| |||
SP Prudential U.S. Emerging Growth Class II * |
|
1,016 |
|
26,212 |
|
20 |
|
68,045 |
| |||
Value Class II * |
|
2,339 |
|
85,049 |
|
— |
|
3,759 |
| |||
Schwab VIT Balanced |
|
5,139,239 |
|
72,154,910 |
|
11,811,248 |
|
8,843,126 |
| |||
Schwab VIT Balanced with Growth |
|
9,410,053 |
|
147,549,629 |
|
4,544,480 |
|
12,973,643 |
| |||
Schwab VIT Growth |
|
8,933,164 |
|
156,509,040 |
|
8,731,507 |
|
15,740,335 |
| |||
State Street Total Return V.I.S. Class 3 |
|
23,124,796 |
|
383,177,863 |
|
24,861,122 |
|
62,452,523 |
| |||
VanEck VIP Global Hard Assets Class S |
|
831,911 |
|
17,927,685 |
|
9,875,332 |
|
9,518,776 |
| |||
* The variable account did not receive any dividend or capital gain distributions from its underlying portfolio/fund during the reporting period.
See Notes to Financial Statements |
|
SEPARATE ACCOUNT A
STATEMENTS OF ASSETS AND LIABILITIES
|
|
Variable Accounts |
| ||||||||||||||||
|
|
Core |
|
Diversified |
|
Floating |
|
High Yield |
|
Inflation |
|
Managed |
| ||||||
|
|
Income |
|
Bond |
|
Rate Income |
|
Bond |
|
Managed |
|
Bond |
| ||||||
|
|
Class I |
|
Class I |
|
Class I |
|
Class I |
|
Class I |
|
Class I |
| ||||||
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Investments in mutual funds, at value |
|
$ |
38,331,761 |
|
$ |
225,525,843 |
|
$ |
133,791,351 |
|
$ |
169,937,437 |
|
$ |
181,599,783 |
|
$ |
403,574,498 |
|
Receivables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Due from Pacific Life Insurance Company |
|
89,117 |
|
102,083 |
|
30,745 |
|
60,792 |
|
223,507 |
|
585,076 |
| ||||||
Investments sold |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
| ||||||
Total Assets |
|
38,420,878 |
|
225,627,926 |
|
133,822,096 |
|
169,998,229 |
|
181,823,290 |
|
404,159,574 |
| ||||||
LIABILITIES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
| |||||||
Investments purchased |
|
91,001 |
|
103,214 |
|
35,733 |
|
57,662 |
|
218,715 |
|
581,733 |
| ||||||
Total Liabilities |
|
91,001 |
|
103,214 |
|
35,733 |
|
57,662 |
|
218,715 |
|
581,733 |
| ||||||
NET ASSETS |
|
$ |
38,329,877 |
|
$ |
225,524,712 |
|
$ |
133,786,363 |
|
$ |
169,940,567 |
|
$ |
181,604,575 |
|
$ |
403,577,841 |
|
NET ASSETS CONSIST OF: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Accumulation units |
|
38,259,912 |
|
225,474,915 |
|
133,779,629 |
|
169,747,878 |
|
181,375,195 |
|
402,763,140 |
| ||||||
Contracts in payout (annuitization) period |
|
69,965 |
|
49,797 |
|
6,734 |
|
192,689 |
|
229,380 |
|
814,701 |
| ||||||
NET ASSETS |
|
$ |
38,329,877 |
|
$ |
225,524,712 |
|
$ |
133,786,363 |
|
$ |
169,940,567 |
|
$ |
181,604,575 |
|
$ |
403,577,841 |
|
Units Outstanding |
|
3,189,553 |
|
15,489,503 |
|
11,256,440 |
|
9,125,009 |
|
10,364,592 |
|
22,834,095 |
| ||||||
Accumulation Unit Value |
|
$11.46 - $12.51 |
|
$12.14 - $19.49 |
|
$10.97 - $12.78 |
|
$11.64 - $29.64 |
|
$10.12 - $26.35 |
|
$11.07 - $28.90 |
| ||||||
Cost of Investments |
|
$ |
33,442,171 |
|
$ |
165,411,413 |
|
$ |
115,509,785 |
|
$ |
89,082,157 |
|
$ |
144,576,443 |
|
$ |
281,909,398 |
|
|
|
Short Duration |
|
Emerging |
|
Dividend |
|
Equity |
|
Focused |
|
|
| ||||||
|
|
Bond |
|
Markets Debt |
|
Growth |
|
Index |
|
Growth |
|
Growth |
| ||||||
|
|
Class I |
|
Class I |
|
Class I |
|
Class I |
|
Class I |
|
Class I |
| ||||||
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Investments in mutual funds, at value |
|
$ |
359,491,596 |
|
$ |
18,135,519 |
|
$ |
392,587,744 |
|
$ |
1,207,544,808 |
|
$ |
219,366,676 |
|
$ |
386,226,270 |
|
Receivables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Due from Pacific Life Insurance Company |
|
— |
|
8,819 |
|
— |
|
117,844 |
|
— |
|
— |
| ||||||
Investments sold |
|
460,126 |
|
— |
|
343,953 |
|
— |
|
72,914 |
|
119,606 |
| ||||||
Total Assets |
|
359,951,722 |
|
18,144,338 |
|
392,931,697 |
|
1,207,662,652 |
|
219,439,590 |
|
386,345,876 |
| ||||||
LIABILITIES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
459,942 |
|
— |
|
340,665 |
|
— |
|
71,796 |
|
121,080 |
| |||||||
Investments purchased |
|
— |
|
9,510 |
|
— |
|
117,755 |
|
— |
|
— |
| ||||||
Total Liabilities |
|
459,942 |
|
9,510 |
|
340,665 |
|
117,755 |
|
71,796 |
|
121,080 |
| ||||||
NET ASSETS |
|
$ |
359,491,780 |
|
$ |
18,134,828 |
|
$ |
392,591,032 |
|
$ |
1,207,544,897 |
|
$ |
219,367,794 |
|
$ |
386,224,796 |
|
NET ASSETS CONSIST OF: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Accumulation units |
|
359,340,472 |
|
18,114,110 |
|
392,238,109 |
|
1,207,115,232 |
|
219,278,255 |
|
385,647,990 |
| ||||||
Contracts in payout (annuitization) period |
|
151,308 |
|
20,718 |
|
352,923 |
|
429,665 |
|
89,539 |
|
576,806 |
| ||||||
NET ASSETS |
|
$ |
359,491,780 |
|
$ |
18,134,828 |
|
$ |
392,591,032 |
|
$ |
1,207,544,897 |
|
$ |
219,367,794 |
|
$ |
386,224,796 |
|
Units Outstanding |
|
33,138,939 |
|
1,580,511 |
|
14,379,140 |
|
42,907,290 |
|
5,161,793 |
|
7,677,598 |
| ||||||
Accumulation Unit Value |
|
$9.90 - $13.35 |
|
$10.36 - $12.81 |
|
$15.73 - $36.88 |
|
$16.13 - $63.79 |
|
$22.24 - $87.16 |
|
$21.12 - $90.01 |
| ||||||
Cost of Investments |
|
$ |
311,095,285 |
|
$ |
13,846,076 |
|
$ |
103,236,554 |
|
$ |
413,493,880 |
|
$ |
25,273,875 |
|
$ |
90,229,512 |
|
See Notes to Financial Statements |
|
SEPARATE ACCOUNT A
STATEMENTS OF ASSETS AND LIABILITIES (Continued)
|
|
Variable Accounts |
| ||||||||||||||||
|
|
Large-Cap |
|
Large-Cap |
|
Main Street |
|
Mid-Cap |
|
Mid-Cap |
|
Mid-Cap |
| ||||||
|
|
Growth |
|
Value |
|
Core |
|
Equity |
|
Growth |
|
Value |
| ||||||
|
|
Class I |
|
Class I |
|
Class I |
|
Class I |
|
Class I |
|
Class I |
| ||||||
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Investments in mutual funds, at value |
|
$ |
292,562,123 |
|
$ |
200,556,647 |
|
$ |
283,529,275 |
|
$ |
234,856,073 |
|
$ |
341,822,790 |
|
$ |
85,400,568 |
|
Receivables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Due from Pacific Life Insurance Company |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
| ||||||
Investments sold |
|
203,090 |
|
306,851 |
|
226,207 |
|
114,393 |
|
419,123 |
|
18,493 |
| ||||||
Total Assets |
|
292,765,213 |
|
200,863,498 |
|
283,755,482 |
|
234,970,466 |
|
342,241,913 |
|
85,419,061 |
| ||||||
LIABILITIES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
199,425 |
|
303,096 |
|
223,481 |
|
112,409 |
|
416,106 |
|
17,118 |
| |||||||
Investments purchased |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
| ||||||
Total Liabilities |
|
199,425 |
|
303,096 |
|
223,481 |
|
112,409 |
|
416,106 |
|
17,118 |
| ||||||
NET ASSETS |
|
$ |
292,565,788 |
|
$ |
200,560,402 |
|
$ |
283,532,001 |
|
$ |
234,858,057 |
|
$ |
341,825,807 |
|
$ |
85,401,943 |
|
NET ASSETS CONSIST OF: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Accumulation units |
|
292,301,532 |
|
200,290,901 |
|
283,010,550 |
|
234,344,137 |
|
341,598,405 |
|
85,301,521 |
| ||||||
Contracts in payout (annuitization) period |
|
264,256 |
|
269,501 |
|
521,451 |
|
513,920 |
|
227,402 |
|
100,422 |
| ||||||
NET ASSETS |
|
$ |
292,565,788 |
|
$ |
200,560,402 |
|
$ |
283,532,001 |
|
$ |
234,858,057 |
|
$ |
341,825,807 |
|
$ |
85,401,943 |
|
Units Outstanding |
|
9,264,727 |
|
8,251,342 |
|
8,154,980 |
|
6,443,675 |
|
9,767,687 |
|
3,812,231 |
| ||||||
Accumulation Unit Value |
|
$21.42 - $49.94 |
|
$12.91 - $31.65 |
|
$16.30 - $48.17 |
|
$15.60 - $58.40 |
|
$23.82 - $46.10 |
|
$13.39 - $36.52 |
| ||||||
Cost of Investments |
|
$62,223,206 |
|
$57,116,808 |
|
$65,101,395 |
|
$63,459,288 |
|
$54,586,147 |
|
$37,734,454 |
|
|
|
Small-Cap |
|
Small-Cap |
|
Small-Cap |
|
Small-Cap |
|
|
|
Value |
| ||||||
|
|
Equity |
|
Growth |
|
Index |
|
Value |
|
Value |
|
Advantage |
| ||||||
|
|
Class I |
|
Class I |
|
Class I |
|
Class I |
|
Class I |
|
Class I |
| ||||||
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Investments in mutual funds, at value |
|
$ |
54,784,426 |
|
$ |
155,142,029 |
|
$ |
265,840,145 |
|
$ |
108,115,842 |
|
$ |
176,476,171 |
|
$ |
46,723,715 |
|
Receivables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Due from Pacific Life Insurance Company |
|
— |
|
— |
|
— |
|
— |
|
— |
|
25,523 |
| ||||||
Investments sold |
|
7,220 |
|
308,466 |
|
128,548 |
|
151,443 |
|
43,188 |
|
— |
| ||||||
Total Assets |
|
54,791,646 |
|
155,450,495 |
|
265,968,693 |
|
108,267,285 |
|
176,519,359 |
|
46,749,238 |
| ||||||
LIABILITIES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
7,395 |
|
305,189 |
|
124,951 |
|
149,010 |
|
39,129 |
|
— |
| |||||||
Investments purchased |
|
— |
|
— |
|
— |
|
— |
|
— |
|
26,965 |
| ||||||
Total Liabilities |
|
7,395 |
|
305,189 |
|
124,951 |
|
149,010 |
|
39,129 |
|
26,965 |
| ||||||
NET ASSETS |
|
$ |
54,784,251 |
|
$ |
155,145,306 |
|
$ |
265,843,742 |
|
$ |
108,118,275 |
|
$ |
176,480,230 |
|
$ |
46,722,273 |
|
NET ASSETS CONSIST OF: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Accumulation units |
|
54,772,299 |
|
154,874,089 |
|
265,601,416 |
|
108,005,564 |
|
176,404,841 |
|
46,688,839 |
| ||||||
Contracts in payout (annuitization) period |
|
11,952 |
|
271,217 |
|
242,326 |
|
112,711 |
|
75,389 |
|
33,434 |
| ||||||
NET ASSETS |
|
$ |
54,784,251 |
|
$ |
155,145,306 |
|
$ |
265,843,742 |
|
$ |
108,118,275 |
|
$ |
176,480,230 |
|
$ |
46,722,273 |
|
Units Outstanding |
|
2,628,838 |
|
4,452,222 |
|
10,160,705 |
|
4,325,214 |
|
8,856,167 |
|
2,729,163 |
| ||||||
Accumulation Unit Value |
|
$12.53 - $36.14 |
|
$24.95 - $45.17 |
|
$14.02 - $43.41 |
|
$11.08 - $53.74 |
|
$11.16 - $25.66 |
|
$12.84 - $18.42 |
| ||||||
Cost of Investments |
|
$ |
20,804,627 |
|
$ |
28,589,902 |
|
$ |
65,972,948 |
|
$ |
40,559,226 |
|
$ |
61,314,576 |
|
$ |
34,024,672 |
|
See Notes to Financial Statements |
|
SEPARATE ACCOUNT A
STATEMENTS OF ASSETS AND LIABILITIES (Continued)
|
|
Variable Accounts |
| ||||||||||||||||
|
|
Emerging |
|
International |
|
International |
|
International |
|
Health |
|
Real |
| ||||||
|
|
Markets |
|
Large-Cap |
|
Small-Cap |
|
Value |
|
Sciences |
|
Estate |
| ||||||
|
|
Class I |
|
Class I |
|
Class I |
|
Class I |
|
Class I |
|
Class I |
| ||||||
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Investments in mutual funds, at value |
|
$ |
204,652,805 |
|
$ |
270,335,105 |
|
$ |
41,342,157 |
|
$ |
104,399,243 |
|
$ |
319,282,109 |
|
$ |
124,838,005 |
|
Receivables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Due from Pacific Life Insurance Company |
|
— |
|
— |
|
5,519 |
|
14,974 |
|
— |
|
— |
| ||||||
Investments sold |
|
15,917 |
|
95,100 |
|
— |
|
— |
|
87,423 |
|
20,535 |
| ||||||
Total Assets |
|
204,668,722 |
|
270,430,205 |
|
41,347,676 |
|
104,414,217 |
|
319,369,532 |
|
124,858,540 |
| ||||||
LIABILITIES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
13,196 |
|
92,368 |
|
— |
|
— |
|
84,958 |
|
17,144 |
| |||||||
Investments purchased |
|
— |
|
— |
|
3,873 |
|
12,979 |
|
— |
|
— |
| ||||||
Total Liabilities |
|
13,196 |
|
92,368 |
|
3,873 |
|
12,979 |
|
84,958 |
|
17,144 |
| ||||||
NET ASSETS |
|
$ |
204,655,526 |
|
$ |
270,337,837 |
|
$ |
41,343,803 |
|
$ |
104,401,238 |
|
$ |
319,284,574 |
|
$ |
124,841,396 |
|
NET ASSETS CONSIST OF: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Accumulation units |
|
204,403,522 |
|
270,069,456 |
|
41,296,736 |
|
104,311,078 |
|
319,125,171 |
|
124,598,966 |
| ||||||
Contracts in payout (annuitization) period |
|
252,004 |
|
268,381 |
|
47,067 |
|
90,160 |
|
159,403 |
|
242,430 |
| ||||||
NET ASSETS |
|
$ |
204,655,526 |
|
$ |
270,337,837 |
|
$ |
41,343,803 |
|
$ |
104,401,238 |
|
$ |
319,284,574 |
|
$ |
124,841,396 |
|
Units Outstanding |
|
8,202,236 |
|
14,339,332 |
|
2,805,711 |
|
9,146,865 |
|
7,254,306 |
|
4,888,497 |
| ||||||
Accumulation Unit Value |
|
$14.16 - $92.71 |
|
$13.97 - $32.23 |
|
$11.71 - $21.47 |
|
$6.88 - $13.55 |
|
$17.10 - $89.57 |
|
$12.54 - $60.20 |
| ||||||
Cost of Investments |
|
$ |
47,284,694 |
|
$ |
96,092,534 |
|
$ |
16,436,993 |
|
$ |
63,949,951 |
|
$ |
40,935,765 |
|
$ |
30,837,602 |
|
|
|
|
|
|
|
Pacific |
|
Pacific |
|
|
|
|
| ||||||
|
|
|
|
PSF DFA |
|
Dynamix - |
|
Dynamix - |
|
Pacific |
|
Portfolio |
| ||||||
|
|
|
|
Balanced |
|
Conservative |
|
Moderate |
|
Dynamix - |
|
Optimization |
| ||||||
|
|
Technology |
|
Allocation |
|
Growth |
|
Growth |
|
Growth |
|
Conservative |
| ||||||
|
|
Class I |
|
Class D |
|
Class I |
|
Class I |
|
Class I |
|
Class I |
| ||||||
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Investments in mutual funds, at value |
|
$ |
208,730,778 |
|
$ |
287,805,519 |
|
$ |
566,127,021 |
|
$ |
2,492,893,673 |
|
$ |
1,095,441,951 |
|
$ |
1,534,709,404 |
|
Receivables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Due from Pacific Life Insurance Company |
|
207,135 |
|
— |
|
— |
|
84,996 |
|
— |
|
— |
| ||||||
Investments sold |
|
— |
|
68,733 |
|
6,210 |
|
— |
|
192,257 |
|
445,992 |
| ||||||
Total Assets |
|
208,937,913 |
|
287,874,252 |
|
566,133,231 |
|
2,492,978,669 |
|
1,095,634,208 |
|
1,535,155,396 |
| ||||||
LIABILITIES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
— |
|
73,631 |
|
6,282 |
|
— |
|
192,952 |
|
439,056 |
| |||||||
Investments purchased |
|
206,635 |
|
— |
|
— |
|
80,398 |
|
— |
|
— |
| ||||||
Total Liabilities |
|
206,635 |
|
73,631 |
|
6,282 |
|
80,398 |
|
192,952 |
|
439,056 |
| ||||||
NET ASSETS |
|
$ |
208,731,278 |
|
$ |
287,800,621 |
|
$ |
566,126,949 |
|
$ |
2,492,898,271 |
|
$ |
1,095,441,256 |
|
$ |
1,534,716,340 |
|
NET ASSETS CONSIST OF: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Accumulation units |
|
208,710,120 |
|
287,741,122 |
|
566,042,073 |
|
2,492,679,481 |
|
1,095,219,370 |
|
1,534,117,419 |
| ||||||
Contracts in payout (annuitization) period |
|
21,158 |
|
59,499 |
|
84,876 |
|
218,790 |
|
221,886 |
|
598,921 |
| ||||||
NET ASSETS |
|
$ |
208,731,278 |
|
$ |
287,800,621 |
|
$ |
566,126,949 |
|
$ |
2,492,898,271 |
|
$ |
1,095,441,256 |
|
$ |
1,534,716,340 |
|
Units Outstanding |
|
7,706,962 |
|
20,364,483 |
|
34,235,499 |
|
136,145,159 |
|
52,279,480 |
|
115,277,984 |
| ||||||
Accumulation Unit Value |
|
$17.05 - $35.18 |
|
$12.90 - $14.72 |
|
$12.68 - $22.62 |
|
$13.22 - $27.13 |
|
$14.01 - $32.07 |
|
$11.66 - $14.92 |
| ||||||
Cost of Investments |
|
$ |
53,848,879 |
|
$ |
223,766,659 |
|
$ |
345,620,379 |
|
$ |
1,380,767,379 |
|
$ |
611,085,944 |
|
$ |
1,011,220,889 |
|
See Notes to Financial Statements |
|
SEPARATE ACCOUNT A
STATEMENTS OF ASSETS AND LIABILITIES (Continued)
|
|
Variable Accounts |
| ||||||||||||||||
|
|
Portfolio |
|
|
|
|
|
Portfolio |
|
|
|
Invesco |
| ||||||
|
|
Optimization |
|
Portfolio |
|
Portfolio |
|
Optimization |
|
Invesco |
|
Oppenheimer |
| ||||||
|
|
Moderate- |
|
Optimization |
|
Optimization |
|
Aggressive- |
|
Oppenheimer |
|
V.I. International |
| ||||||
|
|
Conservative |
|
Moderate |
|
Growth |
|
Growth |
|
V.I. Global |
|
Growth |
| ||||||
|
|
Class I |
|
Class I |
|
Class I |
|
Class I |
|
Series II |
|
Series II |
| ||||||
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Investments in mutual funds, at value |
|
$ |
2,134,134,639 |
|
$ |
8,961,798,616 |
|
$ |
7,748,066,200 |
|
$ |
1,627,060,680 |
|
$ |
22,746,969 |
|
$ |
18,637,093 |
|
Receivables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Due from Pacific Life Insurance Company |
|
— |
|
— |
|
— |
|
— |
|
1,507 |
|
4,567 |
| ||||||
Investments sold |
|
465,374 |
|
1,855,559 |
|
3,428,790 |
|
1,674,987 |
|
— |
|
— |
| ||||||
Total Assets |
|
2,134,600,013 |
|
8,963,654,175 |
|
7,751,494,990 |
|
1,628,735,667 |
|
22,748,476 |
|
18,641,660 |
| ||||||
LIABILITIES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
457,010 |
|
1,842,337 |
|
3,421,443 |
|
1,670,104 |
|
— |
|
— |
| |||||||
Investments purchased |
|
— |
|
— |
|
— |
|
— |
|
2,407 |
|
5,353 |
| ||||||
Total Liabilities |
|
457,010 |
|
1,842,337 |
|
3,421,443 |
|
1,670,104 |
|
2,407 |
|
5,353 |
| ||||||
NET ASSETS |
|
$ |
2,134,143,003 |
|
$ |
8,961,811,838 |
|
$ |
7,748,073,547 |
|
$ |
1,627,065,563 |
|
$ |
22,746,069 |
|
$ |
18,636,307 |
|
NET ASSETS CONSIST OF: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Accumulation units |
|
2,132,682,877 |
|
8,956,002,116 |
|
7,744,280,575 |
|
1,625,992,174 |
|
22,724,550 |
|
18,636,307 |
| ||||||
Contracts in payout (annuitization) period |
|
1,460,126 |
|
5,809,722 |
|
3,792,972 |
|
1,073,389 |
|
21,519 |
|
— |
| ||||||
NET ASSETS |
|
$ |
2,134,143,003 |
|
$ |
8,961,811,838 |
|
$ |
7,748,073,547 |
|
$ |
1,627,065,563 |
|
$ |
22,746,069 |
|
$ |
18,636,307 |
|
Units Outstanding |
|
143,065,548 |
|
548,864,454 |
|
439,483,300 |
|
89,683,364 |
|
1,257,546 |
|
1,294,995 |
| ||||||
Accumulation Unit Value |
|
$12.29 - $16.60 |
|
$ 12.62 - $18.57 |
|
$14.62 - $20.63 |
|
$13.47 - $21.86 |
|
$17.12 - $19.72 |
|
$13.64 - $16.01 |
| ||||||
Cost of Investments |
|
$ |
1,238,832,473 |
|
$ |
4,670,534,374 |
|
$ |
3,666,772,603 |
|
$ |
735,276,744 |
|
$ |
16,908,985 |
|
$ |
14,400,286 |
|
|
|
Invesco V.I. |
|
Invesco V.I. |
|
Invesco V.I. |
|
American |
|
|
|
American Funds |
| ||||||
|
|
Balanced-Risk |
|
Equity and |
|
Global |
|
Century |
|
American Funds |
|
IS Blue Chip |
| ||||||
|
|
Allocation |
|
Income |
|
Real Estate |
|
VP Mid Cap Value |
|
IS Asset Allocation |
|
Income and Growth |
| ||||||
|
|
Series II |
|
Series II |
|
Series II |
|
Class II |
|
Class 4 |
|
Class 4 |
| ||||||
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Investments in mutual funds, at value |
|
$ |
314,903,796 |
|
$ |
55,231,471 |
|
$ |
7,940,626 |
|
$ |
84,024,515 |
|
$ |
3,586,428,287 |
|
$ |
144,975,493 |
|
Receivables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Due from Pacific Life Insurance Company |
|
172,549 |
|
— |
|
11,335 |
|
12,405 |
|
193,583 |
|
83,455 |
| ||||||
Investments sold |
|
— |
|
34,053 |
|
— |
|
— |
|
— |
|
— |
| ||||||
Total Assets |
|
315,076,345 |
|
55,265,524 |
|
7,951,961 |
|
84,036,920 |
|
3,586,621,870 |
|
145,058,948 |
| ||||||
LIABILITIES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
— |
|
36,856 |
|
— |
|
— |
|
— |
|
— |
| |||||||
Investments purchased |
|
166,487 |
|
— |
|
11,778 |
|
13,114 |
|
196,264 |
|
88,069 |
| ||||||
Total Liabilities |
|
166,487 |
|
36,856 |
|
11,778 |
|
13,114 |
|
196,264 |
|
88,069 |
| ||||||
NET ASSETS |
|
$ |
314,909,858 |
|
$ |
55,228,668 |
|
$ |
7,940,183 |
|
$ |
84,023,806 |
|
$ |
3,586,425,606 |
|
$ |
144,970,879 |
|
NET ASSETS CONSIST OF: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Accumulation units |
|
314,895,045 |
|
55,217,878 |
|
7,940,183 |
|
83,984,842 |
|
3,585,775,165 |
|
144,797,955 |
| ||||||
Contracts in payout (annuitization) period |
|
14,813 |
|
10,790 |
|
— |
|
38,964 |
|
650,441 |
|
172,924 |
| ||||||
NET ASSETS |
|
$ |
314,909,858 |
|
$ |
55,228,668 |
|
$ |
7,940,183 |
|
$ |
84,023,806 |
|
$ |
3,586,425,606 |
|
$ |
144,970,879 |
|
Units Outstanding |
|
18,600,508 |
|
3,865,857 |
|
776,994 |
|
4,475,406 |
|
237,956,490 |
|
9,569,016 |
| ||||||
Accumulation Unit Value |
|
$12.03 - $24.11 |
|
$12.18 - $15.24 |
|
$9.73 - $11.59 |
|
$11.63 - $21.90 |
|
$13.42 - $16.37 |
|
$12.69 - $15.85 |
| ||||||
Cost of Investments |
|
$ |
311,838,689 |
|
$ |
51,912,273 |
|
$ |
8,492,428 |
|
$ |
73,818,169 |
|
$ |
2,911,871,665 |
|
$ |
131,009,288 |
|
See Notes to Financial Statements |
|
SEPARATE ACCOUNT A
STATEMENTS OF ASSETS AND LIABILITIES (Continued)
|
|
Variable Accounts |
| ||||||||||||||||
|
|
|
|
American Funds |
|
American Funds |
|
|
|
American Funds |
|
|
| ||||||
|
|
American Funds |
|
IS Capital |
|
IS Capital |
|
American Funds |
|
IS Global Growth |
|
American Funds |
| ||||||
|
|
IS Bond |
|
Income Builder |
|
World Bond |
|
IS Global Balanced |
|
and Income |
|
IS Global Growth |
| ||||||
|
|
Class 4 |
|
Class 4 |
|
Class 4 |
|
Class 4 |
|
Class 4 |
|
Class 4 |
| ||||||
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Investments in mutual funds, at value |
|
$ |
119,133,092 |
|
$ |
108,922,508 |
|
$ |
20,166,607 |
|
$ |
69,378,568 |
|
$ |
54,094,946 |
|
$ |
150,259,325 |
|
Receivables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Due from Pacific Life Insurance Company |
|
— |
|
— |
|
8,609 |
|
37,539 |
|
9,324 |
|
— |
| ||||||
Investments sold |
|
525,261 |
|
1,168,049 |
|
— |
|
— |
|
— |
|
69,719 |
| ||||||
Total Assets |
|
119,658,353 |
|
110,090,557 |
|
20,175,216 |
|
69,416,107 |
|
54,104,270 |
|
150,329,044 |
| ||||||
LIABILITIES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
528,673 |
|
1,170,684 |
|
— |
|
— |
|
— |
|
72,790 |
| |||||||
Investments purchased |
|
— |
|
— |
|
9,466 |
|
39,115 |
|
11,398 |
|
— |
| ||||||
Total Liabilities |
|
528,673 |
|
1,170,684 |
|
9,466 |
|
39,115 |
|
11,398 |
|
72,790 |
| ||||||
NET ASSETS |
|
$ |
119,129,680 |
|
$ |
108,919,873 |
|
$ |
20,165,750 |
|
$ |
69,376,992 |
|
$ |
54,092,872 |
|
$ |
150,256,254 |
|
NET ASSETS CONSIST OF: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Accumulation units |
|
119,122,869 |
|
108,907,952 |
|
20,156,799 |
|
69,363,239 |
|
54,029,612 |
|
150,064,528 |
| ||||||
Contracts in payout (annuitization) period |
|
6,811 |
|
11,921 |
|
8,951 |
|
13,753 |
|
63,260 |
|
191,726 |
| ||||||
NET ASSETS |
|
$ |
119,129,680 |
|
$ |
108,919,873 |
|
$ |
20,165,750 |
|
$ |
69,376,992 |
|
$ |
54,092,872 |
|
$ |
150,256,254 |
|
Units Outstanding |
|
10,104,867 |
|
8,994,388 |
|
1,710,525 |
|
4,845,740 |
|
3,388,396 |
|
6,822,409 |
| ||||||
Accumulation Unit Value |
|
|
$11.23 - $12.20 |
|
|
$11.39 - $12.90 |
|
|
$11.22 - $12.24 |
|
|
$13.67 - $14.85 |
|
|
$14.20 - $16.54 |
|
|
$18.04 - $23.54 |
|
Cost of Investments |
|
$ |
111,939,406 |
|
$ |
97,377,908 |
|
$ |
18,356,007 |
|
$ |
60,452,437 |
|
$ |
46,023,444 |
|
$ |
101,157,554 |
|
|
|
American Funds |
|
|
|
|
|
American Funds |
|
|
|
American Funds |
| ||||||
|
|
IS Global Small |
|
American Funds |
|
American Funds |
|
IS High-Income |
|
American Funds |
|
IS International |
| ||||||
|
|
Capitalization |
|
IS Growth |
|
IS Growth-Income |
|
Bond |
|
IS International |
|
Growth and Income |
| ||||||
|
|
Class 4 |
|
Class 4 |
|
Class 4 |
|
Class 4 |
|
Class 4 |
|
Class 4 |
| ||||||
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Investments in mutual funds, at value |
|
$ |
36,148,993 |
|
$ |
648,936,352 |
|
$ |
406,480,454 |
|
$ |
35,349,126 |
|
$ |
101,273,286 |
|
$ |
58,571,925 |
|
Receivables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Due from Pacific Life Insurance Company |
|
— |
|
— |
|
168,270 |
|
— |
|
40,732 |
|
64,112 |
| ||||||
Investments sold |
|
134,882 |
|
7,164 |
|
— |
|
248,219 |
|
— |
|
— |
| ||||||
Total Assets |
|
36,283,875 |
|
648,943,516 |
|
406,648,724 |
|
35,597,345 |
|
101,314,018 |
|
58,636,037 |
| ||||||
LIABILITIES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
136,342 |
|
10,343 |
|
— |
|
249,873 |
|
— |
|
— |
| |||||||
Investments purchased |
|
— |
|
— |
|
169,503 |
|
— |
|
43,404 |
|
66,560 |
| ||||||
Total Liabilities |
|
136,342 |
|
10,343 |
|
169,503 |
|
249,873 |
|
43,404 |
|
66,560 |
| ||||||
NET ASSETS |
|
$ |
36,147,533 |
|
$ |
648,933,173 |
|
$ |
406,479,221 |
|
$ |
35,347,472 |
|
$ |
101,270,614 |
|
$ |
58,569,477 |
|
NET ASSETS CONSIST OF: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Accumulation units |
|
36,147,533 |
|
648,778,609 |
|
406,168,621 |
|
35,347,472 |
|
101,270,614 |
|
58,566,420 |
| ||||||
Contracts in payout (annuitization) period |
|
— |
|
154,564 |
|
310,600 |
|
— |
|
— |
|
3,057 |
| ||||||
NET ASSETS |
|
$ |
36,147,533 |
|
$ |
648,933,173 |
|
$ |
406,479,221 |
|
$ |
35,347,472 |
|
$ |
101,270,614 |
|
$ |
58,569,477 |
|
Units Outstanding |
|
1,990,423 |
|
24,975,444 |
|
22,979,190 |
|
2,696,891 |
|
7,177,101 |
|
4,731,166 |
| ||||||
Accumulation Unit Value |
|
|
$16.72 - $18.88 |
|
|
$21.83 - $30.31 |
|
|
$15.15 - $19.82 |
|
|
$11.65 - $13.69 |
|
|
$13.21 - $15.77 |
|
|
$11.54 - $14.45 |
|
Cost of Investments |
|
$ |
26,680,799 |
|
$ |
377,137,188 |
|
$ |
338,435,080 |
|
$ |
34,709,984 |
|
$ |
81,419,552 |
|
$ |
49,213,279 |
|
See Notes to Financial Statements |
|
SEPARATE ACCOUNT A
STATEMENTS OF ASSETS AND LIABILITIES (Continued)
|
|
Variable Accounts |
| ||||||||||||||||
|
|
|
|
|
|
American Funds IS |
|
|
|
|
|
|
| ||||||
|
|
American Funds |
|
|
|
U.S. Government/ |
|
BlackRock |
|
BlackRock |
|
BlackRock |
| ||||||
|
|
IS Managed Risk |
|
American Funds IS |
|
AAA-Rated |
|
60/40 Target |
|
Capital |
|
Global |
| ||||||
|
|
Asset Allocation |
|
New World Fund |
|
Securities |
|
Allocation |
|
Appreciation |
|
Allocation |
| ||||||
|
|
Class P2 |
|
Class 4 |
|
Class 4 |
|
ETF V.I. Class I |
|
V.I. Class III |
|
V.I. Class III |
| ||||||
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Investments in mutual funds, at value |
|
$ |
162,113,969 |
|
$ |
68,150,757 |
|
$ |
115,984,711 |
|
$ |
110,853,359 |
|
$ |
41,083,359 |
|
$ |
1,608,713,335 |
|
Receivables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Due from Pacific Life Insurance Company |
|
— |
|
23,159 |
|
— |
|
511,673 |
|
— |
|
— |
| ||||||
Investments sold |
|
6,645 |
|
— |
|
388,486 |
|
— |
|
27,228 |
|
676,754 |
| ||||||
Total Assets |
|
162,120,614 |
|
68,173,916 |
|
116,373,197 |
|
111,365,032 |
|
41,110,587 |
|
1,609,390,089 |
| ||||||
LIABILITIES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
10,776 |
|
— |
|
392,598 |
|
— |
|
26,701 |
|
669,065 |
| |||||||
Investments purchased |
|
— |
|
25,667 |
|
— |
|
513,717 |
|
— |
|
— |
| ||||||
Total Liabilities |
|
10,776 |
|
25,667 |
|
392,598 |
|
513,717 |
|
26,701 |
|
669,065 |
| ||||||
NET ASSETS |
|
$ |
162,109,838 |
|
$ |
68,148,249 |
|
$ |
115,980,599 |
|
$ |
110,851,315 |
|
$ |
41,083,886 |
|
$ |
1,608,721,024 |
|
NET ASSETS CONSIST OF: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Accumulation units |
|
162,085,834 |
|
68,119,739 |
|
115,932,274 |
|
110,851,315 |
|
41,037,610 |
|
1,608,556,191 |
| ||||||
Contracts in payout (annuitization) period |
|
24,004 |
|
28,510 |
|
48,325 |
|
— |
|
46,276 |
|
164,833 |
| ||||||
NET ASSETS |
|
$ |
162,109,838 |
|
$ |
68,148,249 |
|
$ |
115,980,599 |
|
$ |
110,851,315 |
|
$ |
41,083,886 |
|
$ |
1,608,721,024 |
|
Units Outstanding |
|
11,596,589 |
|
4,414,153 |
|
10,237,716 |
|
7,597,641 |
|
1,006,731 |
|
98,050,229 |
| ||||||
Accumulation Unit Value |
|
$12.27 - $14.93 |
|
$14.47 - $17.59 |
|
$10.75 - $12.05 |
|
$13.81 - $15.36 |
|
$33.90 - $46.14 |
|
$13.51 - $19.09 |
| ||||||
Cost of Investments |
|
$ |
145,886,380 |
|
$ |
46,354,360 |
|
$ |
111,760,919 |
|
$ |
93,379,504 |
|
$ |
31,676,180 |
|
$ |
1,190,290,355 |
|
|
|
|
|
|
|
Fidelity VIP |
|
|
|
First Trust |
|
First Trust |
| ||||||
|
|
Fidelity VIP |
|
Fidelity VIP |
|
Government |
|
Fidelity VIP |
|
Dorsey Wright |
|
Multi Income |
| ||||||
|
|
Contrafund |
|
FundsManager 60% |
|
Money Market |
|
Strategic Income |
|
Tactical Core |
|
Allocation |
| ||||||
|
|
Service Class 2 |
|
Service Class 2 |
|
Service Class |
|
Service Class 2 |
|
Class I |
|
Class I |
| ||||||
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Investments in mutual funds, at value |
|
$ |
293,433,606 |
|
$ |
364,926,040 |
|
$ |
482,684,674 |
|
$ |
87,079,133 |
|
$ |
36,363,655 |
|
$ |
17,367,476 |
|
Receivables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Due from Pacific Life Insurance Company |
|
— |
|
— |
|
606,639 |
|
74,745 |
|
— |
|
— |
| ||||||
Investments sold |
|
156,178 |
|
369,557 |
|
— |
|
— |
|
6,154 |
|
32 |
| ||||||
Total Assets |
|
293,589,784 |
|
365,295,597 |
|
483,291,313 |
|
87,153,878 |
|
36,369,809 |
|
17,367,508 |
| ||||||
LIABILITIES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
158,851 |
|
368,822 |
|
— |
|
— |
|
7,788 |
|
827 |
| |||||||
Investments purchased |
|
— |
|
— |
|
615,397 |
|
76,859 |
|
— |
|
— |
| ||||||
Total Liabilities |
|
158,851 |
|
368,822 |
|
615,397 |
|
76,859 |
|
7,788 |
|
827 |
| ||||||
NET ASSETS |
|
$ |
293,430,933 |
|
$ |
364,926,775 |
|
$ |
482,675,916 |
|
$ |
87,077,019 |
|
$ |
36,362,021 |
|
$ |
17,366,681 |
|
NET ASSETS CONSIST OF: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Accumulation units |
|
293,423,681 |
|
364,769,780 |
|
482,220,142 |
|
87,077,019 |
|
36,362,021 |
|
17,350,603 |
| ||||||
Contracts in payout (annuitization) period |
|
7,252 |
|
156,995 |
|
455,774 |
|
— |
|
— |
|
16,078 |
| ||||||
NET ASSETS |
|
$ |
293,430,933 |
|
$ |
364,926,775 |
|
$ |
482,675,916 |
|
$ |
87,077,019 |
|
$ |
36,362,021 |
|
$ |
17,366,681 |
|
Units Outstanding |
|
11,335,278 |
|
21,137,865 |
|
50,158,206 |
|
7,026,620 |
|
2,656,872 |
|
1,416,254 |
| ||||||
Accumulation Unit Value |
|
$17.09 - $28.96 |
|
$13.69 - $19.65 |
|
$9.15 - $10.31 |
|
$11.52 - $13.17 |
|
$13.09 - $14.61 |
|
$11.05 - $13.02 |
| ||||||
Cost of Investments |
|
$ |
199,297,636 |
|
$ |
333,250,621 |
|
$ |
482,684,674 |
|
$ |
83,182,783 |
|
$ |
28,555,022 |
|
$ |
15,846,745 |
|
See Notes to Financial Statements |
|
SEPARATE ACCOUNT A
STATEMENTS OF ASSETS AND LIABILITIES (Continued)
|
|
Variable Accounts |
| ||||||||||||||||
|
|
First Trust/Dow |
|
|
|
|
|
|
|
Franklin |
|
Franklin |
| ||||||
|
|
Jones Dividend & |
|
Franklin |
|
Franklin |
|
Franklin |
|
Mutual Global |
|
Rising |
| ||||||
|
|
Income Allocation |
|
Allocation |
|
Allocation |
|
Income |
|
Discovery |
|
Dividends |
| ||||||
|
|
Class I |
|
VIP Class 2 |
|
VIP Class 4 |
|
VIP Class 2 |
|
VIP Class 2 |
|
VIP Class 2 |
| ||||||
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Investments in mutual funds, at value |
|
$ |
662,991,144 |
|
$ |
25,870,800 |
|
$ |
269,022,839 |
|
$ |
53,971,796 |
|
$ |
188,577,098 |
|
$ |
212,784,926 |
|
Receivables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Due from Pacific Life Insurance Company |
|
— |
|
501 |
|
— |
|
— |
|
— |
|
19,792 |
| ||||||
Investments sold |
|
212,024 |
|
— |
|
148,723 |
|
— |
|
216,857 |
|
— |
| ||||||
Total Assets |
|
663,203,168 |
|
25,871,301 |
|
269,171,562 |
|
53,971,796 |
|
188,793,955 |
|
212,804,718 |
| ||||||
LIABILITIES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
211,773 |
|
— |
|
146,906 |
|
1,620 |
|
217,300 |
|
— |
| |||||||
Investments purchased |
|
— |
|
1,065 |
|
— |
|
1,032 |
|
— |
|
18,989 |
| ||||||
Total Liabilities |
|
211,773 |
|
1,065 |
|
146,906 |
|
2,652 |
|
217,300 |
|
18,989 |
| ||||||
NET ASSETS |
|
$ |
662,991,395 |
|
$ |
25,870,236 |
|
$ |
269,024,656 |
|
$ |
53,969,144 |
|
$ |
188,576,655 |
|
$ |
212,785,729 |
|
NET ASSETS CONSIST OF: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Accumulation units |
|
662,741,384 |
|
25,866,490 |
|
268,962,009 |
|
53,969,144 |
|
188,512,109 |
|
212,749,057 |
| ||||||
Contracts in payout (annuitization) period |
|
250,011 |
|
3,746 |
|
62,647 |
|
— |
|
64,546 |
|
36,672 |
| ||||||
NET ASSETS |
|
$ |
662,991,395 |
|
$ |
25,870,236 |
|
$ |
269,024,656 |
|
$ |
53,969,144 |
|
$ |
188,576,655 |
|
$ |
212,785,729 |
|
Units Outstanding |
|
38,413,073 |
|
1,319,963 |
|
16,724,233 |
|
4,573,894 |
|
11,609,935 |
|
9,362,137 |
| ||||||
Accumulation Unit Value |
|
|
$12.81 - $19.65 |
|
$17.72 - $20.80 |
|
|
$13.59 - $19.06 |
|
|
$11.29 - $12.45 |
|
|
$11.56 - $19.30 |
|
|
$15.52 - $25.63 |
| |
Cost of Investments |
|
$ |
535,034,629 |
|
$ |
29,107,720 |
|
$ |
269,619,468 |
|
$ |
52,723,925 |
|
$ |
201,051,530 |
|
$ |
178,471,981 |
|
|
|
|
|
Ivy |
|
|
|
Janus |
|
Janus |
|
JPMorgan |
| ||||||
|
|
Templeton |
|
VIP Asset |
|
Ivy |
|
Henderson |
|
Henderson |
|
Insurance Trust |
| ||||||
|
|
Global Bond |
|
Strategy |
|
VIP Energy |
|
Balanced |
|
Flexible Bond |
|
Core Bond |
| ||||||
|
|
VIP Class 2 |
|
Class II |
|
Class II |
|
Service Shares |
|
Service Shares |
|
Class 1 |
| ||||||
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Investments in mutual funds, at value |
|
$ |
77,422,394 |
|
$ |
14,484,865 |
|
$ |
19,133,608 |
|
$ |
4,242,268,733 |
|
$ |
39,514,129 |
|
$ |
174,893 |
|
Receivables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Due from Pacific Life Insurance Company |
|
55,439 |
|
57,072 |
|
93,101 |
|
3,552,021 |
|
38,995 |
|
14 |
| ||||||
Investments sold |
|
— |
|
— |
|
— |
|
— |
|
— |
|
7 |
| ||||||
Total Assets |
|
77,477,833 |
|
14,541,937 |
|
19,226,709 |
|
4,245,820,754 |
|
39,553,124 |
|
174,914 |
| ||||||
LIABILITIES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
| |||||||
Investments purchased |
|
56,585 |
|
57,367 |
|
94,054 |
|
3,556,449 |
|
40,679 |
|
— |
| ||||||
Total Liabilities |
|
56,585 |
|
57,367 |
|
94,054 |
|
3,556,449 |
|
40,679 |
|
— |
| ||||||
NET ASSETS |
|
$ |
77,421,248 |
|
$ |
14,484,570 |
|
$ |
19,132,655 |
|
$ |
4,242,264,305 |
|
$ |
39,512,445 |
|
$ |
174,914 |
|
NET ASSETS CONSIST OF: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Accumulation units |
|
77,406,248 |
|
14,484,570 |
|
19,132,655 |
|
4,241,872,621 |
|
39,499,801 |
|
174,762 |
| ||||||
Contracts in payout (annuitization) period |
|
15,000 |
|
— |
|
— |
|
391,684 |
|
12,644 |
|
152 |
| ||||||
NET ASSETS |
|
$ |
77,421,248 |
|
$ |
14,484,570 |
|
$ |
19,132,655 |
|
$ |
4,242,264,305 |
|
$ |
39,512,445 |
|
$ |
174,914 |
|
Units Outstanding |
|
8,259,570 |
|
1,158,794 |
|
5,774,234 |
|
221,575,730 |
|
3,367,311 |
|
10,472 |
| ||||||
Accumulation Unit Value |
|
|
$8.63 - $11.92 |
|
$11.87 - $15.51 |
|
|
$3.18 - $3.87 |
|
|
$14.95 - $21.48 |
|
|
$11.18 - $12.44 |
|
|
$16.17 - $16.72 |
| |
Cost of Investments |
|
$ |
87,132,358 |
|
$ |
11,868,777 |
|
$ |
14,607,219 |
|
$ |
3,274,790,197 |
|
$ |
36,470,979 |
|
$ |
153,370 |
|
See Notes to Financial Statements
SEPARATE ACCOUNT A
STATEMENTS OF ASSETS AND LIABILITIES (Continued)
|
|
Variable Accounts |
| ||||||||||||||||
|
|
JPMorgan |
|
JPMorgan |
|
JPMorgan |
|
JPMorgan |
|
ClearBridge |
|
Lord Abbett |
| ||||||
|
|
Insurance Trust |
|
Insurance Trust |
|
Insurance Trust |
|
Insurance Trust |
|
Variable |
|
Bond |
| ||||||
|
|
Global Allocation |
|
Income Builder |
|
Mid Cap Value |
|
U.S. Equity |
|
Aggressive |
|
Debenture |
| ||||||
|
|
Class 2 |
|
Class 2 |
|
Class 1 |
|
Class 1 |
|
Growth - Class II |
|
Class VC |
| ||||||
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Investments in mutual funds, at value |
|
$ |
13,073,398 |
|
$ |
14,216,356 |
|
$ |
96,540 |
|
$ |
23,635 |
|
$ |
14,337,598 |
|
$ |
131,582,709 |
|
Receivables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Due from Pacific Life Insurance Company |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
| ||||||
Investments sold |
|
272 |
|
4,366 |
|
4 |
|
1 |
|
4,011 |
|
235,223 |
| ||||||
Total Assets |
|
13,073,670 |
|
14,220,722 |
|
96,544 |
|
23,636 |
|
14,341,609 |
|
131,817,932 |
| ||||||
LIABILITIES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
863 |
|
5,157 |
|
1 |
|
1 |
|
4,585 |
|
237,524 |
| |||||||
Investments purchased |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
| ||||||
Total Liabilities |
|
863 |
|
5,157 |
|
1 |
|
1 |
|
4,585 |
|
237,524 |
| ||||||
NET ASSETS |
|
$ |
13,072,807 |
|
$ |
14,215,565 |
|
$ |
96,543 |
|
$ |
23,635 |
|
$ |
14,337,024 |
|
$ |
131,580,408 |
|
NET ASSETS CONSIST OF: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Accumulation units |
|
13,072,807 |
|
14,215,565 |
|
96,543 |
|
23,635 |
|
14,337,024 |
|
131,547,204 |
| ||||||
Contracts in payout (annuitization) period |
|
— |
|
— |
|
— |
|
— |
|
— |
|
33,204 |
| ||||||
NET ASSETS |
|
$ |
13,072,807 |
|
$ |
14,215,565 |
|
$ |
96,543 |
|
$ |
23,635 |
|
$ |
14,337,024 |
|
$ |
131,580,408 |
|
Units Outstanding |
|
941,553 |
|
1,169,287 |
|
3,139 |
|
561 |
|
980,629 |
|
9,342,834 |
| ||||||
Accumulation Unit Value |
|
|
$13.32 - $14.81 |
|
|
$11.63 - $12.86 |
|
|
$29.95 - $30.96 |
|
|
$42.12 - $42.12 |
|
|
$13.74 - $15.50 |
|
|
$11.74 - $15.33 |
|
Cost of Investments |
|
$ |
10,335,435 |
|
$ |
12,716,017 |
|
$ |
62,973 |
|
$ |
7,302 |
|
$ |
12,511,946 |
|
$ |
125,275,731 |
|
|
|
|
|
MFS |
|
|
|
|
|
|
|
|
| ||||||
|
|
|
|
Massachusetts |
|
MFS |
|
MFS |
|
MFS |
|
Neuberger Berman |
| ||||||
|
|
Lord Abbett |
|
Investors |
|
Total Return |
|
Utilities |
|
Value |
|
U.S. Equity Index |
| ||||||
|
|
Total Return |
|
Growth Stock - |
|
Series - |
|
Series - |
|
Series - |
|
PutWrite Strategy |
| ||||||
|
|
Class VC |
|
Service Class |
|
Service Class |
|
Service Class |
|
Service Class |
|
Class S |
| ||||||
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Investments in mutual funds, at value |
|
$ |
303,125,202 |
|
$ |
81,262,367 |
|
$ |
439,107,146 |
|
$ |
54,426,040 |
|
$ |
83,597,024 |
|
$ |
1,648,955 |
|
Receivables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Due from Pacific Life Insurance Company |
|
462,140 |
|
— |
|
142,436 |
|
— |
|
— |
|
— |
| ||||||
Investments sold |
|
— |
|
44,406 |
|
— |
|
3,770 |
|
35,711 |
|
52 |
| ||||||
Total Assets |
|
303,587,342 |
|
81,306,773 |
|
439,249,582 |
|
54,429,810 |
|
83,632,735 |
|
1,649,007 |
| ||||||
LIABILITIES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
— |
|
43,502 |
|
— |
|
4,974 |
|
35,128 |
|
121 |
| |||||||
Investments purchased |
|
463,778 |
|
— |
|
142,297 |
|
— |
|
— |
|
— |
| ||||||
Total Liabilities |
|
463,778 |
|
43,502 |
|
142,297 |
|
4,974 |
|
35,128 |
|
121 |
| ||||||
NET ASSETS |
|
$ |
303,123,564 |
|
$ |
81,263,271 |
|
$ |
439,107,285 |
|
$ |
54,424,836 |
|
$ |
83,597,607 |
|
$ |
1,648,886 |
|
NET ASSETS CONSIST OF: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Accumulation units |
|
302,972,892 |
|
81,210,339 |
|
438,988,420 |
|
54,413,614 |
|
83,593,915 |
|
1,648,886 |
| ||||||
Contracts in payout (annuitization) period |
|
150,672 |
|
52,932 |
|
118,865 |
|
11,222 |
|
3,692 |
|
— |
| ||||||
NET ASSETS |
|
$ |
303,123,564 |
|
$ |
81,263,271 |
|
$ |
439,107,285 |
|
$ |
54,424,836 |
|
$ |
83,597,607 |
|
$ |
1,648,886 |
|
Units Outstanding |
|
23,597,269 |
|
3,719,603 |
|
25,334,270 |
|
3,359,918 |
|
3,263,118 |
|
144,364 |
| ||||||
Accumulation Unit Value |
|
|
$11.13 - $14.51 |
|
|
$20.99 - $21.91 |
|
|
$12.70 - $19.80 |
|
|
$14.95 - $18.56 |
|
|
$23.29 - $29.35 |
|
|
$11.01 - $12.28 |
|
Cost of Investments |
|
$ |
289,060,226 |
|
$ |
55,972,739 |
|
$ |
374,804,346 |
|
$ |
42,258,577 |
|
$ |
66,728,111 |
|
$ |
1,513,964 |
|
See Notes to Financial Statements
SEPARATE ACCOUNT A
STATEMENTS OF ASSETS AND LIABILITIES (Continued)
|
|
Variable Accounts |
| ||||||||||||||||
|
|
|
|
PIMCO |
|
|
|
|
|
|
|
|
| ||||||
|
|
|
|
Commodity- |
|
|
|
|
|
|
|
SP Prudential |
| ||||||
|
|
|
|
RealReturn |
|
|
|
|
|
SP International |
|
U.S. Emerging |
| ||||||
|
|
PIMCO All Asset - |
|
Strategy - |
|
PIMCO Income - |
|
Jennison |
|
Growth |
|
Growth |
| ||||||
|
|
Advisor Class |
|
Advisor Class |
|
Advisor Class |
|
Class II |
|
Class II |
|
Class II |
| ||||||
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Investments in mutual funds, at value |
|
$ |
2,474,547 |
|
$ |
8,632,420 |
|
$ |
5,238,410 |
|
$ |
122,126 |
|
$ |
65,636 |
|
$ |
26,212 |
|
Receivables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Due from Pacific Life Insurance Company |
|
— |
|
733 |
|
29,733 |
|
— |
|
— |
|
— |
| ||||||
Investments sold |
|
918 |
|
— |
|
— |
|
39 |
|
3 |
|
23 |
| ||||||
Total Assets |
|
2,475,465 |
|
8,633,153 |
|
5,268,143 |
|
122,165 |
|
65,639 |
|
26,235 |
| ||||||
LIABILITIES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
1,009 |
|
— |
|
— |
|
82 |
|
46 |
|
25 |
| |||||||
Investments purchased |
|
— |
|
1,249 |
|
30,043 |
|
— |
|
— |
|
— |
| ||||||
Total Liabilities |
|
1,009 |
|
1,249 |
|
30,043 |
|
82 |
|
46 |
|
25 |
| ||||||
NET ASSETS |
|
$ |
2,474,456 |
|
$ |
8,631,904 |
|
$ |
5,238,100 |
|
$ |
122,083 |
|
$ |
65,593 |
|
$ |
26,210 |
|
NET ASSETS CONSIST OF: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Accumulation units |
|
2,474,456 |
|
8,631,904 |
|
5,238,100 |
|
122,083 |
|
65,593 |
|
26,210 |
| ||||||
Contracts in payout (annuitization) period |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
| ||||||
NET ASSETS |
|
$ |
2,474,456 |
|
$ |
8,631,904 |
|
$ |
5,238,100 |
|
$ |
122,083 |
|
$ |
65,593 |
|
$ |
26,210 |
|
Units Outstanding |
|
202,159 |
|
1,545,855 |
|
470,049 |
|
2,253 |
|
2,402 |
|
478 |
| ||||||
Accumulation Unit Value |
|
|
$12.19 - $12.31 |
|
|
$4.97 - $9.82 |
|
|
$11.09 - $11.20 |
|
|
$52.76 - $54.83 |
|
|
$26.47 - $28.39 |
|
|
$53.87 - $57.64 |
|
Cost of Investments |
|
$ |
2,185,112 |
|
$ |
8,825,665 |
|
$ |
5,059,564 |
|
$ |
12,131 |
|
$ |
19,688 |
|
$ |
4,933 |
|
|
|
|
|
|
|
Schwab |
|
|
|
State Street |
|
VanEck VIP |
| ||||||
|
|
Value |
|
Schwab |
|
VIT Balanced |
|
Schwab |
|
Total Return |
|
Global Hard Assets |
| ||||||
|
|
Class II |
|
VIT Balanced |
|
with Growth |
|
VIT Growth |
|
V.I.S. Class 3 |
|
Class S |
| ||||||
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Investments in mutual funds, at value |
|
$ |
85,049 |
|
$ |
72,154,910 |
|
$ |
147,549,629 |
|
$ |
156,509,040 |
|
$ |
383,177,863 |
|
$ |
17,927,685 |
|
Receivables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Due from Pacific Life Insurance Company |
|
— |
|
— |
|
— |
|
— |
|
— |
|
2,003 |
| ||||||
Investments sold |
|
3 |
|
— |
|
13,007 |
|
15,222 |
|
115,158 |
|
— |
| ||||||
Total Assets |
|
85,052 |
|
72,154,910 |
|
147,562,636 |
|
156,524,262 |
|
383,293,021 |
|
17,929,688 |
| ||||||
LIABILITIES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payables: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
116 |
|
215 |
|
13,538 |
|
15,040 |
|
113,629 |
|
— |
| |||||||
Investments purchased |
|
— |
|
142 |
|
— |
|
— |
|
— |
|
2,641 |
| ||||||
Total Liabilities |
|
116 |
|
357 |
|
13,538 |
|
15,040 |
|
113,629 |
|
2,641 |
| ||||||
NET ASSETS |
|
$ |
84,936 |
|
$ |
72,154,553 |
|
$ |
147,549,098 |
|
$ |
156,509,222 |
|
$ |
383,179,392 |
|
$ |
17,927,047 |
|
NET ASSETS CONSIST OF: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Accumulation units |
|
84,936 |
|
72,154,553 |
|
147,549,098 |
|
156,509,222 |
|
383,108,908 |
|
17,913,554 |
| ||||||
Contracts in payout (annuitization) period |
|
— |
|
— |
|
— |
|
— |
|
70,484 |
|
13,493 |
| ||||||
NET ASSETS |
|
$ |
84,936 |
|
$ |
72,154,553 |
|
$ |
147,549,098 |
|
$ |
156,509,222 |
|
$ |
383,179,392 |
|
$ |
17,927,047 |
|
Units Outstanding |
|
3,391 |
|
4,960,747 |
|
9,090,166 |
|
8,553,128 |
|
21,256,530 |
|
2,482,148 |
| ||||||
Accumulation Unit Value |
|
|
$23.96 - $25.64 |
|
|
$12.74 - $14.60 |
|
|
$13.74 - $16.47 |
|
|
$14.61 - $18.44 |
|
|
$11.97 - $23.92 |
|
|
$6.55 - $8.93 |
|
Cost of Investments |
|
$ |
29,073 |
|
$ |
57,708,627 |
|
$ |
108,717,035 |
|
$ |
108,542,835 |
|
$ |
344,358,836 |
|
$ |
12,845,068 |
|
See Notes to Financial Statements
STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 2020
|
|
Variable Accounts |
| ||||||||||||||||
|
|
Core |
|
Diversified |
|
Floating |
|
High Yield |
|
Inflation |
|
Managed |
| ||||||
|
|
Income |
|
Bond |
|
Rate Income |
|
Bond |
|
Managed |
|
Bond |
| ||||||
|
|
Class I |
|
Class I |
|
Class I |
|
Class I |
|
Class I |
|
Class I |
| ||||||
INVESTMENT INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Dividends |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
EXPENSES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Mortality and expense risk |
|
274,348 |
|
2,008,363 |
|
1,523,298 |
|
1,896,280 |
|
2,128,907 |
|
4,471,978 |
| ||||||
Administrative fees |
|
64,927 |
|
409,413 |
|
298,830 |
|
319,923 |
|
330,898 |
|
740,146 |
| ||||||
Total Expenses |
|
339,275 |
|
2,417,776 |
|
1,822,128 |
|
2,216,203 |
|
2,459,805 |
|
5,212,124 |
| ||||||
Net Investment Income (Loss) |
|
(339,275 |
) |
(2,417,776 |
) |
(1,822,128 |
) |
(2,216,203 |
) |
(2,459,805 |
) |
(5,212,124 |
) | ||||||
REALIZED GAIN (LOSS) ON INVESTMENTS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Realized gain (loss) on sale of investments |
|
(355,123 |
) |
(632,715 |
) |
(317,105 |
) |
8,627,075 |
|
988,522 |
|
3,190,105 |
| ||||||
Capital gain distributions |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
| ||||||
Realized Gain (Loss) on Investments |
|
(355,123 |
) |
(632,715 |
) |
(317,105 |
) |
8,627,075 |
|
988,522 |
|
3,190,105 |
| ||||||
CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS |
|
3,003,212 |
|
19,618,028 |
|
4,707,540 |
|
(968,824 |
) |
17,503,980 |
|
27,499,097 |
| ||||||
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS |
|
$ |
2,308,814 |
|
$ |
16,567,537 |
|
$ |
2,568,307 |
|
$ |
5,442,048 |
|
$ |
16,032,697 |
|
$ |
25,477,078 |
|
|
|
Short Duration |
|
Emerging |
|
Dividend |
|
Equity |
|
Focused |
|
|
| ||||||
|
|
Bond |
|
Markets Debt |
|
Growth |
|
Index |
|
Growth |
|
Growth |
| ||||||
|
|
Class I |
|
Class I |
|
Class I |
|
Class I |
|
Class I |
|
Class I |
| ||||||
INVESTMENT INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Dividends |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
EXPENSES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Mortality and expense risk |
|
2,896,820 |
|
176,989 |
|
3,456,309 |
|
10,484,488 |
|
2,128,306 |
|
3,877,221 |
| ||||||
Administrative fees |
|
617,266 |
|
35,858 |
|
660,309 |
|
2,154,474 |
|
376,542 |
|
610,508 |
| ||||||
Total Expenses |
|
3,514,086 |
|
212,847 |
|
4,116,618 |
|
12,638,962 |
|
2,504,848 |
|
4,487,729 |
| ||||||
Net Investment Income (Loss) |
|
(3,514,086 |
) |
(212,847 |
) |
(4,116,618 |
) |
(12,638,962 |
) |
(2,504,848 |
) |
(4,487,729 |
) | ||||||
REALIZED GAIN (LOSS) ON INVESTMENTS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Realized gain (loss) on sale of investments |
|
143,734 |
|
(98,313 |
) |
2,471,101 |
|
2,431,796 |
|
15,662,731 |
|
15,326,873 |
| ||||||
Capital gain distributions |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
| ||||||
Realized Gain (Loss) on Investments |
|
143,734 |
|
(98,313 |
) |
2,471,101 |
|
2,431,796 |
|
15,662,731 |
|
15,326,873 |
| ||||||
CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS |
|
11,658,511 |
|
97,481 |
|
42,781,256 |
|
181,269,923 |
|
44,850,386 |
|
80,246,561 |
| ||||||
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS |
|
$ |
8,288,159 |
|
$ |
(213,679 |
) |
$ |
41,135,739 |
|
$ |
171,062,757 |
|
$ |
58,008,269 |
|
$ |
91,085,705 |
|
|
|
Large-Cap |
|
Large-Cap |
|
Main Street |
|
Mid-Cap |
|
Mid-Cap |
|
Mid-Cap |
| ||||||
|
|
Growth |
|
Value |
|
Core |
|
Equity |
|
Growth |
|
Value |
| ||||||
|
|
Class I |
|
Class I |
|
Class I |
|
Class I |
|
Class I |
|
Class I |
| ||||||
INVESTMENT INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Dividends |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
EXPENSES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Mortality and expense risk |
|
2,736,469 |
|
2,126,204 |
|
3,210,537 |
|
2,326,879 |
|
2,883,019 |
|
815,607 |
| ||||||
Administrative fees |
|
492,470 |
|
353,523 |
|
469,966 |
|
372,451 |
|
522,120 |
|
156,489 |
| ||||||
Total Expenses |
|
3,228,939 |
|
2,479,727 |
|
3,680,503 |
|
2,699,330 |
|
3,405,139 |
|
972,096 |
| ||||||
Net Investment Income (Loss) |
|
(3,228,939 |
) |
(2,479,727 |
) |
(3,680,503 |
) |
(2,699,330 |
) |
(3,405,139 |
) |
(972,096 |
) | ||||||
REALIZED GAIN (LOSS) ON INVESTMENTS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Realized gain (loss) on sale of investments |
|
3,459,189 |
|
10,222,123 |
|
31,711,499 |
|
16,449,180 |
|
25,600,264 |
|
5,644,514 |
| ||||||
Capital gain distributions |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
| ||||||
Realized Gain (Loss) on Investments |
|
3,459,189 |
|
10,222,123 |
|
31,711,499 |
|
16,449,180 |
|
25,600,264 |
|
5,644,514 |
| ||||||
CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS |
|
76,159,983 |
|
122,931 |
|
2,382,300 |
|
34,815,939 |
|
91,255,564 |
|
(2,750,116 |
) | ||||||
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS |
|
$ |
76,390,233 |
|
$ |
7,865,327 |
|
$ |
30,413,296 |
|
$ |
48,565,789 |
|
$ |
113,450,689 |
|
$ |
1,922,302 |
|
See Notes to Financial Statements
SEPARATE ACCOUNT A
STATEMENTS OF OPERATIONS (Continued)
FOR THE YEAR ENDED DECEMBER 31, 2020
|
|
Variable Accounts |
| ||||||||||||||||
|
|
Small-Cap |
|
Small-Cap |
|
Small-Cap |
|
Small-Cap |
|
|
|
Value |
| ||||||
|
|
Equity |
|
Growth |
|
Index |
|
Value |
|
Value |
|
Advantage |
| ||||||
|
|
Class I |
|
Class I |
|
Class I |
|
Class I |
|
Class I |
|
Class I |
| ||||||
INVESTMENT INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Dividends |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
EXPENSES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Mortality and expense risk |
|
483,799 |
|
1,238,999 |
|
2,309,031 |
|
1,027,383 |
|
1,481,621 |
|
342,839 |
| ||||||
Administrative fees |
|
93,894 |
|
218,814 |
|
418,879 |
|
180,496 |
|
284,899 |
|
76,488 |
| ||||||
Total Expenses |
|
577,693 |
|
1,457,813 |
|
2,727,910 |
|
1,207,879 |
|
1,766,520 |
|
419,327 |
| ||||||
Net Investment Income (Loss) |
|
(577,693 |
) |
(1,457,813 |
) |
(2,727,910 |
) |
(1,207,879 |
) |
(1,766,520 |
) |
(419,327 |
) | ||||||
REALIZED GAIN (LOSS) ON INVESTMENTS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Realized gain (loss) on sale of investments |
|
786,137 |
|
12,895,889 |
|
5,054,124 |
|
4,917,769 |
|
6,315,968 |
|
(1,071,360 |
) | ||||||
Capital gain distributions |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
| ||||||
Realized Gain (Loss) on Investments |
|
786,137 |
|
12,895,889 |
|
5,054,124 |
|
4,917,769 |
|
6,315,968 |
|
(1,071,360 |
) | ||||||
CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS |
|
2,239,736 |
|
43,331,345 |
|
39,293,645 |
|
(2,362,374 |
) |
(17,471,635 |
) |
(156,195 |
) | ||||||
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS |
|
$ |
2,448,180 |
|
$ |
54,769,421 |
|
$ |
41,619,859 |
|
$ |
1,347,516 |
|
$ |
(12,922,187 |
) |
$ |
(1,646,882 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Emerging |
|
International |
|
International |
|
International |
|
Health |
|
Real |
| ||||||
|
|
Markets |
|
Large-Cap |
|
Small-Cap |
|
Value |
|
Sciences |
|
Estate |
| ||||||
|
|
Class I |
|
Class I |
|
Class I |
|
Class I |
|
Class I |
|
Class I |
| ||||||
INVESTMENT INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Dividends |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
EXPENSES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Mortality and expense risk |
|
1,957,087 |
|
2,433,338 |
|
403,185 |
|
1,066,878 |
|
3,432,989 |
|
1,453,033 |
| ||||||
Administrative fees |
|
345,002 |
|
436,414 |
|
76,695 |
|
175,099 |
|
601,530 |
|
237,524 |
| ||||||
Total Expenses |
|
2,302,089 |
|
2,869,752 |
|
479,880 |
|
1,241,977 |
|
4,034,519 |
|
1,690,557 |
| ||||||
Net Investment Income (Loss) |
|
(2,302,089 |
) |
(2,869,752 |
) |
(479,880 |
) |
(1,241,977 |
) |
(4,034,519 |
) |
(1,690,557 |
) | ||||||
REALIZED GAIN (LOSS) ON INVESTMENTS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Realized gain (loss) on sale of investments |
|
17,227,354 |
|
11,737,640 |
|
2,151,523 |
|
1,879,749 |
|
26,190,175 |
|
9,720,560 |
| ||||||
Capital gain distributions |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
| ||||||
Realized Gain (Loss) on Investments |
|
17,227,354 |
|
11,737,640 |
|
2,151,523 |
|
1,879,749 |
|
26,190,175 |
|
9,720,560 |
| ||||||
CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS |
|
11,987,853 |
|
14,716,462 |
|
1,281,460 |
|
(8,783,466 |
) |
23,121,519 |
|
(15,202,283 |
) | ||||||
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS |
|
$ |
26,913,118 |
|
$ |
23,584,350 |
|
$ |
2,953,103 |
|
$ |
(8,145,694 |
) |
$ |
45,277,175 |
|
$ |
(7,172,280 |
) |
|
|
|
|
|
|
Pacific |
|
Pacific |
|
|
|
|
| ||||||
|
|
|
|
PSF DFA |
|
Dynamix - |
|
Dynamix - |
|
Pacific |
|
Portfolio |
| ||||||
|
|
|
|
Balanced |
|
Conservative |
|
Moderate |
|
Dynamix - |
|
Optimization |
| ||||||
|
|
Technology |
|
Allocation |
|
Growth |
|
Growth |
|
Growth |
|
Conservative |
| ||||||
|
|
Class I |
|
Class D |
|
Class I |
|
Class I |
|
Class I |
|
Class I |
| ||||||
INVESTMENT INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Dividends |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
EXPENSES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Mortality and expense risk |
|
1,973,585 |
|
2,382,638 |
|
5,277,654 |
|
22,837,484 |
|
8,895,947 |
|
18,670,617 |
| ||||||
Administrative fees |
|
356,970 |
|
559,801 |
|
1,046,042 |
|
4,768,132 |
|
1,793,925 |
|
2,929,407 |
| ||||||
Total Expenses |
|
2,330,555 |
|
2,942,439 |
|
6,323,696 |
|
27,605,616 |
|
10,689,872 |
|
21,600,024 |
| ||||||
Net Investment Income (Loss) |
|
(2,330,555 |
) |
(2,942,439 |
) |
(6,323,696 |
) |
(27,605,616 |
) |
(10,689,872 |
) |
(21,600,024 |
) | ||||||
REALIZED GAIN (LOSS) ON INVESTMENTS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Realized gain (loss) on sale of investments |
|
596,052 |
|
(971,568 |
) |
556,255 |
|
34,523,430 |
|
(4,233,295 |
) |
18,364,494 |
| ||||||
Capital gain distributions |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
| ||||||
Realized Gain (Loss) on Investments |
|
596,052 |
|
(971,568 |
) |
556,255 |
|
34,523,430 |
|
(4,233,295 |
) |
18,364,494 |
| ||||||
CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS |
|
66,474,733 |
|
32,472,672 |
|
60,767,724 |
|
282,106,534 |
|
161,747,483 |
|
106,413,033 |
| ||||||
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS |
|
$ |
64,740,230 |
|
$ |
28,558,665 |
|
$ |
55,000,283 |
|
$ |
289,024,348 |
|
$ |
146,824,316 |
|
$ |
103,177,503 |
|
See Notes to Financial Statements
SEPARATE ACCOUNT A
STATEMENTS OF OPERATIONS (Continued)
FOR THE YEAR ENDED DECEMBER 31, 2020
|
|
Variable Accounts |
| ||||||||||||||||
|
|
Portfolio |
|
|
|
|
|
Portfolio |
|
|
|
Invesco |
| ||||||
|
|
Optimization |
|
Portfolio |
|
Portfolio |
|
Optimization |
|
Invesco |
|
Oppenheimer |
| ||||||
|
|
Moderate- |
|
Optimization |
|
Optimization |
|
Aggressive- |
|
Oppenheimer |
|
V.I. International |
| ||||||
|
|
Conservative |
|
Moderate |
|
Growth |
|
Growth |
|
V.I. Global |
|
Growth |
| ||||||
|
|
Class I |
|
Class I |
|
Class I |
|
Class I |
|
Series II |
|
Series II |
| ||||||
INVESTMENT INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Dividends |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
83,699 |
|
$ |
97,955 |
|
EXPENSES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Mortality and expense risk |
|
25,579,579 |
|
107,481,192 |
|
94,551,850 |
|
19,800,280 |
|
197,333 |
|
141,216 |
| ||||||
Administrative fees |
|
3,948,430 |
|
16,453,305 |
|
14,007,201 |
|
2,950,918 |
|
44,310 |
|
32,330 |
| ||||||
Total Expenses |
|
29,528,009 |
|
123,934,497 |
|
108,559,051 |
|
22,751,198 |
|
241,643 |
|
173,546 |
| ||||||
Net Investment Income (Loss) |
|
(29,528,009 |
) |
(123,934,497 |
) |
(108,559,051 |
) |
(22,751,198 |
) |
(157,944 |
) |
(75,591 |
) | ||||||
REALIZED GAIN (LOSS) ON INVESTMENTS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Realized gain (loss) on sale of investments |
|
94,230,169 |
|
455,239,144 |
|
421,269,970 |
|
98,913,707 |
|
(301,789 |
) |
(105,155 |
) | ||||||
Capital gain distributions |
|
— |
|
— |
|
— |
|
— |
|
694,091 |
|
205,821 |
| ||||||
Realized Gain (Loss) on Investments |
|
94,230,169 |
|
455,239,144 |
|
421,269,970 |
|
98,913,707 |
|
392,302 |
|
100,666 |
| ||||||
CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS |
|
99,453,290 |
|
485,699,500 |
|
434,746,926 |
|
75,816,071 |
|
4,314,440 |
|
3,014,412 |
| ||||||
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS |
|
$ |
164,155,450 |
|
$ |
817,004,147 |
|
$ |
747,457,845 |
|
$ |
151,978,580 |
|
$ |
4,548,798 |
|
$ |
3,039,487 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
|
Invesco V.I. |
|
Invesco V.I. |
|
Invesco V.I. |
|
American |
|
|
|
American Funds |
| ||||||
|
|
Balanced-Risk |
|
Equity and |
|
Global |
|
Century |
|
American Funds |
|
IS Blue Chip |
| ||||||
|
|
Allocation |
|
Income |
|
Real Estate |
|
VP Mid Cap Value |
|
IS Asset Allocation |
|
Income and Growth |
| ||||||
|
|
Series II |
|
Series II |
|
Series II |
|
Class II |
|
Class 4 |
|
Class 4 |
| ||||||
INVESTMENT INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Dividends |
|
$ |
22,741,071 |
|
$ |
1,064,922 |
|
$ |
369,993 |
|
$ |
1,257,097 |
|
$ |
47,888,107 |
|
$ |
1,997,522 |
|
EXPENSES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Mortality and expense risk |
|
3,449,024 |
|
418,921 |
|
77,489 |
|
754,005 |
|
35,060,523 |
|
1,104,825 |
| ||||||
Administrative fees |
|
621,100 |
|
90,963 |
|
16,829 |
|
160,217 |
|
6,988,761 |
|
251,181 |
| ||||||
Total Expenses |
|
4,070,124 |
|
509,884 |
|
94,318 |
|
914,222 |
|
42,049,284 |
|
1,356,006 |
| ||||||
Net Investment Income (Loss) |
|
18,670,947 |
|
555,038 |
|
275,675 |
|
342,875 |
|
5,838,823 |
|
641,516 |
| ||||||
REALIZED GAIN (LOSS) ON INVESTMENTS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Realized gain (loss) on sale of investments |
|
(3,166,613 |
) |
(930,110 |
) |
(477,984 |
) |
(1,826,307 |
) |
(1,603,025 |
) |
(2,865,225 |
) | ||||||
Capital gain distributions |
|
15,191,547 |
|
2,201,485 |
|
225,435 |
|
— |
|
15,288,969 |
|
1,488,514 |
| ||||||
Realized Gain (Loss) on Investments |
|
12,024,934 |
|
1,271,375 |
|
(252,549 |
) |
(1,826,307 |
) |
13,685,944 |
|
(1,376,711 |
) | ||||||
CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS |
|
(7,262,740 |
) |
2,298,206 |
|
(1,370,050 |
) |
826,479 |
|
326,844,534 |
|
10,456,217 |
| ||||||
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS |
|
$ |
23,433,141 |
|
$ |
4,124,619 |
|
$ |
(1,346,924 |
) |
$ |
(656,953 |
) |
$ |
346,369,301 |
|
$ |
9,721,022 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
|
|
|
American Funds |
|
American Funds |
|
|
|
American Funds |
|
|
| ||||||
|
|
American Funds |
|
IS Capital |
|
IS Capital |
|
American Funds |
|
IS Global Growth |
|
American Funds |
| ||||||
|
|
IS Bond |
|
Income Builder |
|
World Bond |
|
IS Global Balanced |
|
and Income |
|
IS Global Growth |
| ||||||
|
|
Class 4 |
|
Class 4 |
|
Class 4 |
|
Class 4 |
|
Class 4 |
|
Class 4 |
| ||||||
INVESTMENT INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Dividends |
|
$ |
2,110,059 |
|
$ |
2,713,581 |
|
$ |
193,817 |
|
$ |
561,586 |
|
$ |
506,115 |
|
$ |
192,784 |
|
EXPENSES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Mortality and expense risk |
|
817,772 |
|
917,429 |
|
146,108 |
|
558,980 |
|
371,481 |
|
1,115,856 |
| ||||||
Administrative fees |
|
182,244 |
|
196,700 |
|
33,746 |
|
128,432 |
|
87,264 |
|
254,063 |
| ||||||
Total Expenses |
|
1,000,016 |
|
1,114,129 |
|
179,854 |
|
687,412 |
|
458,745 |
|
1,369,919 |
| ||||||
Net Investment Income (Loss) |
|
1,110,043 |
|
1,599,452 |
|
13,963 |
|
(125,826 |
) |
47,370 |
|
(1,177,135 |
) | ||||||
REALIZED GAIN (LOSS) ON INVESTMENTS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Realized gain (loss) on sale of investments |
|
(172,288 |
) |
(511,174 |
) |
(42,341 |
) |
(168,624 |
) |
(473,907 |
) |
(528,931 |
) | ||||||
Capital gain distributions |
|
858,330 |
|
— |
|
290,595 |
|
2,538,714 |
|
1,135,352 |
|
3,417,715 |
| ||||||
Realized Gain (Loss) on Investments |
|
686,042 |
|
(511,174 |
) |
248,254 |
|
2,370,090 |
|
661,445 |
|
2,888,784 |
| ||||||
CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS |
|
5,145,199 |
|
1,688,851 |
|
1,183,963 |
|
3,279,355 |
|
3,498,430 |
|
31,045,962 |
| ||||||
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS |
|
$ |
6,941,284 |
|
$ |
2,777,129 |
|
$ |
1,446,180 |
|
$ |
5,523,619 |
|
$ |
4,207,245 |
|
$ |
32,757,611 |
|
See Notes to Financial Statements
SEPARATE ACCOUNT A
STATEMENTS OF OPERATIONS (Continued)
FOR THE YEAR ENDED DECEMBER 31, 2020
|
|
Variable Accounts |
| ||||||||||||||||
|
|
American Funds |
|
|
|
|
|
American Funds |
|
|
|
American Funds |
| ||||||
|
|
IS Global Small |
|
American Funds |
|
American Funds |
|
IS High-Income |
|
American Funds |
|
IS International |
| ||||||
|
|
Capitalization |
|
IS Growth |
|
IS Growth-Income |
|
Bond |
|
IS International |
|
Growth and Income |
| ||||||
|
|
Class 4 |
|
Class 4 |
|
Class 4 |
|
Class 4 |
|
Class 4 |
|
Class 4 |
| ||||||
INVESTMENT INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Dividends |
|
$ |
33,959 |
|
$ |
1,015,559 |
|
$ |
4,253,559 |
|
$ |
2,502,892 |
|
$ |
378,384 |
|
$ |
661,455 |
|
EXPENSES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Mortality and expense risk |
|
224,015 |
|
5,211,341 |
|
3,823,355 |
|
288,795 |
|
729,062 |
|
445,662 |
| ||||||
Administrative fees |
|
51,764 |
|
1,040,015 |
|
732,373 |
|
65,590 |
|
165,608 |
|
99,963 |
| ||||||
Total Expenses |
|
275,779 |
|
6,251,356 |
|
4,555,728 |
|
354,385 |
|
894,670 |
|
545,625 |
| ||||||
Net Investment Income (Loss) |
|
(241,820 |
) |
(5,235,797 |
) |
(302,169 |
) |
2,148,507 |
|
(516,286 |
) |
115,830 |
| ||||||
REALIZED GAIN (LOSS) ON INVESTMENTS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Realized gain (loss) on sale of investments |
|
(205,939 |
) |
981,005 |
|
(1,250,929 |
) |
(705,469 |
) |
(1,503,867 |
) |
(732,626 |
) | ||||||
Capital gain distributions |
|
1,640,648 |
|
11,819,482 |
|
9,768,513 |
|
— |
|
— |
|
— |
| ||||||
Realized Gain (Loss) on Investments |
|
1,434,709 |
|
12,800,487 |
|
8,517,584 |
|
(705,469 |
) |
(1,503,867 |
) |
(732,626 |
) | ||||||
CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS |
|
6,763,192 |
|
206,625,724 |
|
33,305,119 |
|
642,185 |
|
13,253,066 |
|
3,235,187 |
| ||||||
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS |
|
$ |
7,956,081 |
|
$ |
214,190,414 |
|
$ |
41,520,534 |
|
$ |
2,085,223 |
|
$ |
11,232,913 |
|
$ |
2,618,391 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
|
|
|
|
|
American Funds IS |
|
|
|
|
|
|
| ||||||
|
|
American Funds |
|
|
|
U.S. Government/ |
|
BlackRock |
|
BlackRock |
|
BlackRock |
| ||||||
|
|
IS Managed Risk |
|
American Funds IS |
|
AAA-Rated |
|
60/40 Target |
|
Capital |
|
Global |
| ||||||
|
|
Asset Allocation |
|
New World Fund |
|
Securities |
|
Allocation |
|
Appreciation |
|
Allocation |
| ||||||
|
|
Class P2 |
|
Class 4 |
|
Class 4 |
|
ETF V.I. Class I |
|
V.I. Class III |
|
V.I. Class III |
| ||||||
INVESTMENT INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Dividends |
|
$ |
2,228,450 |
|
$ |
21,033 |
|
$ |
1,896,826 |
|
$ |
1,632,813 |
|
$ |
— |
|
$ |
18,409,151 |
|
EXPENSES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Mortality and expense risk |
|
1,566,410 |
|
508,943 |
|
1,014,924 |
|
777,701 |
|
251,513 |
|
16,659,578 |
| ||||||
Administrative fees |
|
335,455 |
|
112,505 |
|
208,154 |
|
179,155 |
|
55,838 |
|
2,938,903 |
| ||||||
Total Expenses |
|
1,901,865 |
|
621,448 |
|
1,223,078 |
|
956,856 |
|
307,351 |
|
19,598,481 |
| ||||||
Net Investment Income (Loss) |
|
326,585 |
|
(600,415 |
) |
673,748 |
|
675,957 |
|
(307,351 |
) |
(1,189,330 |
) | ||||||
REALIZED GAIN (LOSS) ON INVESTMENTS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Realized gain (loss) on sale of investments |
|
(697,862 |
) |
(251,361 |
) |
(96,203 |
) |
(308,236 |
) |
180,820 |
|
12,817,758 |
| ||||||
Capital gain distributions |
|
5,803,140 |
|
588,704 |
|
2,133,687 |
|
172,447 |
|
3,685,299 |
|
90,270,483 |
| ||||||
Realized Gain (Loss) on Investments |
|
5,105,278 |
|
337,343 |
|
2,037,484 |
|
(135,789 |
) |
3,866,119 |
|
103,088,241 |
| ||||||
CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS |
|
1,911,274 |
|
12,130,861 |
|
3,170,057 |
|
12,186,970 |
|
9,378,996 |
|
157,932,039 |
| ||||||
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS |
|
$ |
7,343,137 |
|
$ |
11,867,789 |
|
$ |
5,881,289 |
|
$ |
12,727,138 |
|
$ |
12,937,764 |
|
$ |
259,830,950 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
|
|
|
|
|
Fidelity VIP |
|
|
|
First Trust |
|
First Trust |
| ||||||
|
|
Fidelity VIP |
|
Fidelity VIP |
|
Government |
|
Fidelity VIP |
|
Dorsey Wright |
|
Multi Income |
| ||||||
|
|
Contrafund |
|
FundsManager 60% |
|
Money Market |
|
Strategic Income |
|
Tactical Core |
|
Allocation |
| ||||||
|
|
Service Class 2 |
|
Service Class 2 |
|
Service Class |
|
Service Class 2 |
|
Class I |
|
Class I |
| ||||||
INVESTMENT INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Dividends |
|
$ |
199,246 |
|
$ |
2,961,300 |
|
$ |
956,872 |
|
$ |
2,567,364 |
|
$ |
159,470 |
|
$ |
357,933 |
|
EXPENSES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Mortality and expense risk |
|
2,546,248 |
|
3,343,601 |
|
4,696,114 |
|
761,689 |
|
329,898 |
|
160,679 |
| ||||||
Administrative fees |
|
542,454 |
|
696,981 |
|
880,723 |
|
175,335 |
|
73,518 |
|
37,233 |
| ||||||
Total Expenses |
|
3,088,702 |
|
4,040,582 |
|
5,576,837 |
|
937,024 |
|
403,416 |
|
197,912 |
| ||||||
Net Investment Income (Loss) |
|
(2,889,456 |
) |
(1,079,282 |
) |
(4,619,965 |
) |
1,630,340 |
|
(243,946 |
) |
160,021 |
| ||||||
REALIZED GAIN (LOSS) ON INVESTMENTS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Realized gain (loss) on sale of investments |
|
578,895 |
|
(5,599,645 |
) |
— |
|
(576,400 |
) |
(251,553 |
) |
(51,877 |
) | ||||||
Capital gain distributions |
|
1,352,223 |
|
7,591,325 |
|
— |
|
803,705 |
|
— |
|
200,149 |
| ||||||
Realized Gain (Loss) on Investments |
|
1,931,118 |
|
1,991,680 |
|
— |
|
227,305 |
|
(251,553 |
) |
148,272 |
| ||||||
CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS |
|
65,222,288 |
|
41,925,073 |
|
— |
|
2,676,315 |
|
3,457,427 |
|
4,300 |
| ||||||
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS |
|
$ |
64,263,950 |
|
$ |
42,837,471 |
|
$ |
(4,619,965 |
) |
$ |
4,533,960 |
|
$ |
2,961,928 |
|
$ |
312,593 |
|
See Notes to Financial Statements
SEPARATE ACCOUNT A
STATEMENTS OF OPERATIONS (Continued)
FOR THE YEAR ENDED DECEMBER 31, 2020
|
|
Variable Accounts |
| ||||||||||||||||
|
|
First Trust/Dow |
|
|
|
|
|
|
|
Franklin |
|
Franklin |
| ||||||
|
|
Jones Dividend & |
|
Franklin |
|
Franklin |
|
Franklin |
|
Mutual Global |
|
Rising |
| ||||||
|
|
Income Allocation |
|
Allocation |
|
Allocation |
|
Income |
|
Discovery |
|
Dividends |
| ||||||
|
|
Class I |
|
VIP Class 2 |
|
VIP Class 4 |
|
VIP Class 2 |
|
VIP Class 2 |
|
VIP Class 2 |
| ||||||
INVESTMENT INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Dividends |
|
$ |
9,127,495 |
|
$ |
352,359 |
|
$ |
3,385,187 |
|
$ |
3,091,877 |
|
$ |
4,159,279 |
|
$ |
2,366,945 |
|
EXPENSES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Mortality and expense risk |
|
6,751,650 |
|
160,193 |
|
3,095,709 |
|
523,511 |
|
1,393,846 |
|
1,845,297 |
| ||||||
Administrative fees |
|
1,326,954 |
|
35,559 |
|
513,860 |
|
106,930 |
|
300,440 |
|
389,604 |
| ||||||
Total Expenses |
|
8,078,604 |
|
195,752 |
|
3,609,569 |
|
630,441 |
|
1,694,286 |
|
2,234,901 |
| ||||||
Net Investment Income (Loss) |
|
1,048,891 |
|
156,607 |
|
(224,382 |
) |
2,461,436 |
|
2,464,993 |
|
132,044 |
| ||||||
REALIZED GAIN (LOSS) ON INVESTMENTS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Realized gain (loss) on sale of investments |
|
(3,576,386 |
) |
(730,582 |
) |
(6,404,968 |
) |
(1,403,166 |
) |
(11,861,338 |
) |
(1,857,178 |
) | ||||||
Capital gain distributions |
|
20,181,691 |
|
6,278,197 |
|
65,229,253 |
|
43,795 |
|
3,331,418 |
|
10,037,905 |
| ||||||
Realized Gain (Loss) on Investments |
|
16,605,305 |
|
5,547,615 |
|
58,824,285 |
|
(1,359,371 |
) |
(8,529,920 |
) |
8,180,727 |
| ||||||
CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS |
|
19,615,517 |
|
(3,168,345 |
) |
(34,043,298 |
) |
(1,552,418 |
) |
(3,681,017 |
) |
17,678,513 |
| ||||||
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS |
|
$ |
37,269,713 |
|
$ |
2,535,877 |
|
$ |
24,556,605 |
|
$ |
(450,353 |
) |
$ |
(9,745,944 |
) |
$ |
25,991,284 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
|
|
|
Ivy |
|
|
|
Janus |
|
Janus |
|
JPMorgan |
| ||||||
|
|
Templeton |
|
VIP Asset |
|
Ivy |
|
Henderson |
|
Henderson |
|
Insurance Trust |
| ||||||
|
|
Global Bond |
|
Strategy |
|
VIP Energy |
|
Balanced |
|
Flexible Bond |
|
Core Bond |
| ||||||
|
|
VIP Class 2 |
|
Class II |
|
Class II |
|
Service Shares |
|
Service Shares |
|
Class 1 |
| ||||||
INVESTMENT INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Dividends |
|
$ |
6,730,812 |
|
$ |
265,277 |
|
$ |
315,375 |
|
$ |
55,010,931 |
|
$ |
853,202 |
|
$ |
3,827 |
|
EXPENSES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Mortality and expense risk |
|
777,475 |
|
142,150 |
|
157,535 |
|
36,601,161 |
|
359,913 |
|
2,339 |
| ||||||
Administrative fees |
|
170,566 |
|
29,494 |
|
30,102 |
|
7,923,891 |
|
75,242 |
|
279 |
| ||||||
Total Expenses |
|
948,041 |
|
171,644 |
|
187,637 |
|
44,525,052 |
|
435,155 |
|
2,618 |
| ||||||
Net Investment Income (Loss) |
|
5,782,771 |
|
93,633 |
|
127,738 |
|
10,485,879 |
|
418,047 |
|
1,209 |
| ||||||
REALIZED GAIN (LOSS) ON INVESTMENTS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Realized gain (loss) on sale of investments |
|
(2,973,330 |
) |
(48,651 |
) |
(9,369,757 |
) |
(9,845,873 |
) |
(38,797 |
) |
1,957 |
| ||||||
Capital gain distributions |
|
— |
|
222,859 |
|
— |
|
52,824,828 |
|
— |
|
— |
| ||||||
Realized Gain (Loss) on Investments |
|
(2,973,330 |
) |
174,208 |
|
(9,369,757 |
) |
42,978,955 |
|
(38,797 |
) |
1,957 |
| ||||||
CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS |
|
(8,503,699 |
) |
1,295,480 |
|
6,115,432 |
|
410,539,534 |
|
2,370,783 |
|
8,439 |
| ||||||
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS |
|
$ |
(5,694,258 |
) |
$ |
1,563,321 |
|
$ |
(3,126,587 |
) |
$ |
464,004,368 |
|
$ |
2,750,033 |
|
$ |
11,605 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
|
JPMorgan |
|
JPMorgan |
|
JPMorgan |
|
JPMorgan |
|
ClearBridge |
|
Lord Abbett |
| ||||||
|
|
Insurance Trust |
|
Insurance Trust |
|
Insurance Trust |
|
Insurance Trust |
|
Variable |
|
Bond |
| ||||||
|
|
Global Allocation |
|
Income Builder |
|
Mid Cap Value |
|
U.S. Equity |
|
Aggressive |
|
Debenture |
| ||||||
|
|
Class 2 |
|
Class 2 |
|
Class 1 |
|
Class 1 |
|
Growth - Class II |
|
Class VC |
| ||||||
INVESTMENT INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Dividends |
|
$ |
195,654 |
|
$ |
423,038 |
|
$ |
1,222 |
|
$ |
152 |
|
$ |
71,401 |
|
$ |
4,771,338 |
|
EXPENSES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Mortality and expense risk |
|
106,587 |
|
128,847 |
|
1,088 |
|
250 |
|
107,733 |
|
1,103,979 |
| ||||||
Administrative fees |
|
23,297 |
|
27,173 |
|
126 |
|
30 |
|
23,543 |
|
237,197 |
| ||||||
Total Expenses |
|
129,884 |
|
156,020 |
|
1,214 |
|
280 |
|
131,276 |
|
1,341,176 |
| ||||||
Net Investment Income (Loss) |
|
65,770 |
|
267,018 |
|
8 |
|
(128 |
) |
(59,875 |
) |
3,430,162 |
| ||||||
REALIZED GAIN (LOSS) ON INVESTMENTS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Realized gain (loss) on sale of investments |
|
3,338 |
|
(116,092 |
) |
(164 |
) |
58 |
|
(204,586 |
) |
(1,461,520 |
) | ||||||
Capital gain distributions |
|
104,877 |
|
— |
|
5,099 |
|
1,226 |
|
1,206,189 |
|
— |
| ||||||
Realized Gain (Loss) on Investments |
|
108,215 |
|
(116,092 |
) |
4,935 |
|
1,284 |
|
1,001,603 |
|
(1,461,520 |
) | ||||||
CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS |
|
1,441,078 |
|
384,350 |
|
(6,172 |
) |
3,299 |
|
942,502 |
|
4,804,845 |
| ||||||
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS |
|
$ |
1,615,063 |
|
$ |
535,276 |
|
$ |
(1,229 |
) |
$ |
4,455 |
|
$ |
1,884,230 |
|
$ |
6,773,487 |
|
See Notes to Financial Statements
SEPARATE ACCOUNT A
STATEMENTS OF OPERATIONS (Continued)
FOR THE YEAR OR PERIOD ENDED DECEMBER 31, 2020
|
|
Variable Accounts |
| ||||||||||||||||
|
|
|
|
MFS |
|
|
|
|
|
|
|
|
| ||||||
|
|
|
|
Massachusetts |
|
MFS |
|
MFS |
|
MFS |
|
Neuberger Berman |
| ||||||
|
|
Lord Abbett |
|
Investors |
|
Total Return |
|
Utilities |
|
Value |
|
U.S. Equity Index |
| ||||||
|
|
Total Return |
|
Growth Stock - |
|
Series - |
|
Series - |
|
Series - |
|
PutWrite Strategy |
| ||||||
|
|
Class VC |
|
Service Class |
|
Service Class |
|
Service Class |
|
Service Class |
|
Class S |
| ||||||
INVESTMENT INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Dividends |
|
$ |
6,964,094 |
|
$ |
167,433 |
|
$ |
8,581,389 |
|
$ |
1,121,777 |
|
$ |
1,049,446 |
|
$ |
12,516 |
|
EXPENSES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Mortality and expense risk |
|
2,057,145 |
|
491,482 |
|
4,254,863 |
|
540,497 |
|
519,503 |
|
13,695 |
| ||||||
Administrative fees |
|
466,893 |
|
113,238 |
|
851,532 |
|
111,505 |
|
115,490 |
|
3,254 |
| ||||||
Total Expenses |
|
2,524,038 |
|
604,720 |
|
5,106,395 |
|
652,002 |
|
634,993 |
|
16,949 |
| ||||||
Net Investment Income (Loss) |
|
4,440,056 |
|
(437,287 |
) |
3,474,994 |
|
469,775 |
|
414,453 |
|
(4,433 |
) | ||||||
REALIZED GAIN (LOSS) ON INVESTMENTS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Realized gain (loss) on sale of investments |
|
(162,418 |
) |
1,687,220 |
|
(557,158 |
) |
(688,803 |
) |
(57,021 |
) |
(28,263 |
) | ||||||
Capital gain distributions |
|
5,541,896 |
|
7,360,969 |
|
11,175,047 |
|
1,327,293 |
|
3,526,809 |
|
103,238 |
| ||||||
Realized Gain (Loss) on Investments |
|
5,379,478 |
|
9,048,189 |
|
10,617,889 |
|
638,490 |
|
3,469,788 |
|
74,975 |
| ||||||
CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS |
|
7,989,291 |
|
6,696,798 |
|
18,396,657 |
|
(60,970 |
) |
(1,311,516 |
) |
25,523 |
| ||||||
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS |
|
$ |
17,808,825 |
|
$ |
15,307,700 |
|
$ |
32,489,540 |
|
$ |
1,047,295 |
|
$ |
2,572,725 |
|
$ |
96,065 |
|
|
|
|
|
PIMCO |
|
|
|
|
|
|
|
|
| ||||||
|
|
|
|
Commodity- |
|
|
|
|
|
|
|
SP Prudential |
| ||||||
|
|
|
|
RealReturn |
|
|
|
|
|
SP International |
|
U.S. Emerging |
| ||||||
|
|
PIMCO All Asset - |
|
Strategy - |
|
PIMCO Income - |
|
Jennison |
|
Growth |
|
Growth |
| ||||||
|
|
Advisor Class (1) |
|
Advisor Class |
|
Advisor Class (1) |
|
Class II |
|
Class II |
|
Class II |
| ||||||
INVESTMENT INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Dividends |
|
$ |
53,408 |
|
$ |
427,082 |
|
$ |
58,326 |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
EXPENSES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Mortality and expense risk |
|
13,463 |
|
72,219 |
|
15,508 |
|
1,256 |
|
793 |
|
439 |
| ||||||
Administrative fees |
|
2,866 |
|
15,024 |
|
3,453 |
|
143 |
|
82 |
|
43 |
| ||||||
Total Expenses |
|
16,329 |
|
87,243 |
|
18,961 |
|
1,399 |
|
875 |
|
482 |
| ||||||
Net Investment Income (Loss) |
|
37,079 |
|
339,839 |
|
39,365 |
|
(1,399 |
) |
(875 |
) |
(482 |
) | ||||||
REALIZED GAIN (LOSS) ON INVESTMENTS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Realized gain (loss) on sale of investments |
|
6,960 |
|
(373,330 |
) |
(9,354 |
) |
1,716 |
|
2,433 |
|
46,488 |
| ||||||
Capital gain distributions |
|
— |
|
— |
|
1,930 |
|
— |
|
— |
|
— |
| ||||||
Realized Gain (Loss) on Investments |
|
6,960 |
|
(373,330 |
) |
(7,424 |
) |
1,716 |
|
2,433 |
|
46,488 |
| ||||||
CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS |
|
289,435 |
|
179,015 |
|
178,846 |
|
42,256 |
|
13,657 |
|
(34,217 |
) | ||||||
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS |
|
$ |
333,474 |
|
$ |
145,524 |
|
$ |
210,787 |
|
$ |
42,573 |
|
$ |
15,215 |
|
$ |
11,789 |
|
|
|
|
|
|
|
Schwab |
|
|
|
State Street |
|
VanEck VIP |
| ||||||
|
|
Value |
|
Schwab |
|
VIT Balanced |
|
Schwab |
|
Total Return |
|
Global Hard Assets |
| ||||||
|
|
Class II |
|
VIT Balanced |
|
with Growth |
|
VIT Growth |
|
V.I.S. Class 3 |
|
Class S |
| ||||||
INVESTMENT INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Dividends |
|
$ |
— |
|
$ |
1,238,423 |
|
$ |
2,778,335 |
|
$ |
2,857,638 |
|
$ |
5,984,413 |
|
$ |
106,952 |
|
EXPENSES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Mortality and expense risk |
|
1,047 |
|
237,558 |
|
514,390 |
|
507,224 |
|
3,993,326 |
|
137,582 |
| ||||||
Administrative fees |
|
114 |
|
165,629 |
|
339,224 |
|
353,101 |
|
689,701 |
|
29,214 |
| ||||||
Total Expenses |
|
1,161 |
|
403,187 |
|
853,614 |
|
860,325 |
|
4,683,027 |
|
166,796 |
| ||||||
Net Investment Income (Loss) |
|
(1,161 |
) |
835,236 |
|
1,924,721 |
|
1,997,313 |
|
1,301,386 |
|
(59,844 |
) | ||||||
REALIZED GAIN (LOSS) ON INVESTMENTS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Realized gain (loss) on sale of investments |
|
2,239 |
|
(30,912 |
) |
592,879 |
|
1,263,766 |
|
(6,071,893 |
) |
(1,520,068 |
) | ||||||
Capital gain distributions |
|
— |
|
136,303 |
|
368,603 |
|
1,369,247 |
|
— |
|
— |
| ||||||
Realized Gain (Loss) on Investments |
|
2,239 |
|
105,391 |
|
961,482 |
|
2,633,013 |
|
(6,071,893 |
) |
(1,520,068 |
) | ||||||
CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS |
|
120 |
|
4,345,972 |
|
9,401,695 |
|
10,084,528 |
|
20,823,268 |
|
4,407,476 |
| ||||||
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS |
|
$ |
1,198 |
|
$ |
5,286,599 |
|
$ |
12,287,898 |
|
$ |
14,714,854 |
|
$ |
16,052,761 |
|
$ |
2,827,564 |
|
(1) Operations commenced or resumed during 2020 (See Financial Highlights for commencement date of operations).
See Notes to Financial Statements
SEPARATE ACCOUNT A
STATEMENTS OF CHANGES IN NET ASSETS
|
|
Variable Accounts |
| ||||||||||||||||
|
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
| ||||||
|
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
| |||||||
|
|
|
2019 |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
| |||||||
|
|
Core Income |
|
Diversified Bond |
|
Floating Rate Income |
| ||||||||||||
|
|
Class I |
|
Class I |
|
Class I |
| ||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Net investment income (loss) |
|
$ |
(339,275 |
) |
$ |
(190,809 |
) |
$ |
(2,417,776 |
) |
$ |
(2,063,742 |
) |
$ |
(1,822,128 |
) |
$ |
(2,067,236 |
) |
Realized gain (loss) on investments |
|
(355,123 |
) |
(5,277 |
) |
(632,715 |
) |
54,331 |
|
(317,105 |
) |
583,845 |
| ||||||
Change in net unrealized appreciation (depreciation) on investments |
|
3,003,212 |
|
1,555,509 |
|
19,618,028 |
|
19,372,762 |
|
4,707,540 |
|
8,701,294 |
| ||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
2,308,814 |
|
1,359,423 |
|
16,567,537 |
|
17,363,351 |
|
2,568,307 |
|
7,217,903 |
| ||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payments received from contract owners |
|
7,039,076 |
|
6,439,697 |
|
23,500,295 |
|
18,928,934 |
|
5,317,200 |
|
11,084,692 |
| ||||||
Transfers between variable and fixed accounts, net |
|
8,406,427 |
|
6,388,646 |
|
22,078,194 |
|
20,899,819 |
|
(14,518,151 |
) |
113,900,370 |
| ||||||
Contract benefits and terminations |
|
(3,208,419 |
) |
(1,969,740 |
) |
(18,612,936 |
) |
(19,770,841 |
) |
(24,588,397 |
) |
(31,661,000 |
) | ||||||
Contract charges and deductions |
|
(11,835 |
) |
(3,637 |
) |
(277,056 |
) |
(266,799 |
) |
(215,621 |
) |
(204,370 |
) | ||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
386 |
|
301 |
|
(2,594 |
) |
217 |
|
1 |
|
— |
| ||||||
Other |
|
(343 |
) |
(642 |
) |
(4,426 |
) |
6,079 |
|
2,680 |
|
(8,931 |
) | ||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
12,225,292 |
|
10,854,625 |
|
26,681,477 |
|
19,797,409 |
|
(34,002,288 |
) |
93,110,761 |
| ||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
14,534,106 |
|
12,214,048 |
|
43,249,014 |
|
37,160,760 |
|
(31,433,981 |
) |
100,328,664 |
| ||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Beginning of Year |
|
23,795,771 |
|
11,581,723 |
|
182,275,698 |
|
145,114,938 |
|
165,220,344 |
|
64,891,680 |
| ||||||
End of Year |
|
$ |
38,329,877 |
|
$ |
23,795,771 |
|
$ |
225,524,712 |
|
$ |
182,275,698 |
|
$ |
133,786,363 |
|
$ |
165,220,344 |
|
|
|
High Yield Bond |
|
Inflation Managed |
|
Managed Bond |
| ||||||||||||
|
|
Class I |
|
Class I |
|
Class I |
| ||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Net investment income (loss) |
|
$ |
(2,216,203 |
) |
$ |
(2,410,021 |
) |
$ |
(2,459,805 |
) |
$ |
(2,503,834 |
) |
$ |
(5,212,124 |
) |
$ |
(5,102,622 |
) |
Realized gain (loss) on investments |
|
8,627,075 |
|
1,471,199 |
|
988,522 |
|
1,467,230 |
|
3,190,105 |
|
3,637,018 |
| ||||||
Change in net unrealized appreciation (depreciation) on investments |
|
(968,824 |
) |
20,584,909 |
|
17,503,980 |
|
13,063,207 |
|
27,499,097 |
|
26,853,595 |
| ||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
5,442,048 |
|
19,646,087 |
|
16,032,697 |
|
12,026,603 |
|
25,477,078 |
|
25,387,991 |
| ||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payments received from contract owners |
|
6,327,168 |
|
9,341,681 |
|
4,105,872 |
|
4,859,261 |
|
23,965,013 |
|
23,770,674 |
| ||||||
Transfers between variable and fixed accounts, net |
|
(4,157,833 |
) |
19,450,611 |
|
11,588,597 |
|
1,335,857 |
|
24,734,225 |
|
25,676,259 |
| ||||||
Contract benefits and terminations |
|
(18,077,387 |
) |
(24,199,642 |
) |
(19,453,938 |
) |
(24,813,499 |
) |
(50,975,721 |
) |
(58,085,640 |
) | ||||||
Contract charges and deductions |
|
(307,194 |
) |
(371,049 |
) |
(277,485 |
) |
(292,041 |
) |
(592,659 |
) |
(596,304 |
) | ||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
(699 |
) |
800 |
|
(8,525 |
) |
(4,435 |
) |
(31,413 |
) |
2,588 |
| ||||||
Other |
|
(1,882 |
) |
8,884 |
|
(559 |
) |
5,932 |
|
(4,195 |
) |
(1,842 |
) | ||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
(16,217,827 |
) |
4,231,285 |
|
(4,046,038 |
) |
(18,908,925 |
) |
(2,904,750 |
) |
(9,234,265 |
) | ||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
(10,775,779 |
) |
23,877,372 |
|
11,986,659 |
|
(6,882,322 |
) |
22,572,328 |
|
16,153,726 |
| ||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Beginning of Year |
|
180,716,346 |
|
156,838,974 |
|
169,617,916 |
|
176,500,238 |
|
381,005,513 |
|
364,851,787 |
| ||||||
End of Year |
|
$ |
169,940,567 |
|
$ |
180,716,346 |
|
$ |
181,604,575 |
|
$ |
169,617,916 |
|
$ |
403,577,841 |
|
$ |
381,005,513 |
|
See Notes to Financial Statements
SEPARATE ACCOUNT A
STATEMENTS OF CHANGES IN NET ASSETS (Continued)
|
|
Variable Accounts |
| ||||||||||||||||
|
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
| ||||||
|
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
| |||||||
|
|
|
2019 |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
| |||||||
|
|
Short Duration Bond |
|
Emerging Markets Debt |
|
Dividend Growth |
| ||||||||||||
|
|
Class I |
|
Class I |
|
Class I |
| ||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Net investment income (loss) |
|
$ |
(3,514,086 |
) |
$ |
(3,358,491 |
) |
$ |
(212,847 |
) |
$ |
(256,316 |
) |
$ |
(4,116,618 |
) |
$ |
(3,898,609 |
) |
Realized gain (loss) on investments |
|
143,734 |
|
221,565 |
|
(98,313 |
) |
28,296 |
|
2,471,101 |
|
2,668,086 |
| ||||||
Change in net unrealized appreciation (depreciation) on investments |
|
11,658,511 |
|
13,127,141 |
|
97,481 |
|
1,746,773 |
|
42,781,256 |
|
80,970,395 |
| ||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
8,288,159 |
|
9,990,215 |
|
(213,679 |
) |
1,518,753 |
|
41,135,739 |
|
79,739,872 |
| ||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payments received from contract owners |
|
24,718,297 |
|
23,233,460 |
|
916,904 |
|
1,657,819 |
|
26,640,101 |
|
31,648,006 |
| ||||||
Transfers between variable and fixed accounts, net |
|
40,193,640 |
|
47,546,301 |
|
(452,378 |
) |
643,405 |
|
(4,717,100 |
) |
8,259,725 |
| ||||||
Contract benefits and terminations |
|
(54,168,625 |
) |
(48,603,857 |
) |
(2,331,177 |
) |
(2,488,217 |
) |
(30,325,916 |
) |
(32,601,544 |
) | ||||||
Contract charges and deductions |
|
(1,509,100 |
) |
(1,687,238 |
) |
(34,011 |
) |
(34,850 |
) |
(778,018 |
) |
(834,503 |
) | ||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
(7,419 |
) |
171 |
|
— |
|
— |
|
(8,408 |
) |
(2,359 |
) | ||||||
Other |
|
(6,870 |
) |
(60 |
) |
(238 |
) |
581 |
|
13,554 |
|
(1,345 |
) | ||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
9,219,923 |
|
20,488,777 |
|
(1,900,900 |
) |
(221,262 |
) |
(9,175,787 |
) |
6,467,980 |
| ||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
17,508,082 |
|
30,478,992 |
|
(2,114,579 |
) |
1,297,491 |
|
31,959,952 |
|
86,207,852 |
| ||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Beginning of Year |
|
341,983,698 |
|
311,504,706 |
|
20,249,407 |
|
18,951,916 |
|
360,631,080 |
|
274,423,228 |
| ||||||
End of Year |
|
$ |
359,491,780 |
|
$ |
341,983,698 |
|
$ |
18,134,828 |
|
$ |
20,249,407 |
|
$ |
392,591,032 |
|
$ |
360,631,080 |
|
|
|
Equity Index |
|
Focused Growth |
|
Growth |
| ||||||||||||
|
|
Class I |
|
Class I |
|
Class I |
| ||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Net investment income (loss) |
|
$ |
(12,638,962 |
) |
$ |
(11,462,659 |
) |
$ |
(2,504,848 |
) |
$ |
(2,220,066 |
) |
$ |
(4,487,729 |
) |
$ |
(3,846,945 |
) |
Realized gain (loss) on investments |
|
2,431,796 |
|
(240,812 |
) |
15,662,731 |
|
2,496,451 |
|
15,326,873 |
|
9,533,318 |
| ||||||
Change in net unrealized appreciation (depreciation) on investments |
|
181,269,923 |
|
243,802,103 |
|
44,850,386 |
|
44,242,603 |
|
80,246,561 |
|
79,246,201 |
| ||||||
Net Increase (Decrease) in Net Assets |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Resulting from Operations |
|
171,062,757 |
|
232,098,632 |
|
58,008,269 |
|
44,518,988 |
|
91,085,705 |
|
84,932,574 |
| ||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payments received from contract owners |
|
111,702,986 |
|
124,761,214 |
|
17,886,082 |
|
12,684,512 |
|
25,003,243 |
|
17,001,151 |
| ||||||
Transfers between variable and fixed accounts, net |
|
(27,842,638 |
) |
9,344,455 |
|
(13,032,918 |
) |
4,327,227 |
|
(9,142,768 |
) |
1,656,258 |
| ||||||
Contract benefits and terminations |
|
(91,218,533 |
) |
(91,335,715 |
) |
(19,834,456 |
) |
(17,454,296 |
) |
(33,498,940 |
) |
(28,496,179 |
) | ||||||
Contract charges and deductions |
|
(532,266 |
) |
(529,797 |
) |
(174,668 |
) |
(175,009 |
) |
(359,013 |
) |
(307,184 |
) | ||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
(10,492 |
) |
(1,303 |
) |
(2,247 |
) |
(89 |
) |
(9,733 |
) |
27 |
| ||||||
Other |
|
10,869 |
|
26,673 |
|
8,542 |
|
4,225 |
|
23,915 |
|
9,400 |
| ||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
(7,890,074 |
) |
42,265,527 |
|
(15,149,665 |
) |
(613,430 |
) |
(17,983,296 |
) |
(10,136,527 |
) | ||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
163,172,683 |
|
274,364,159 |
|
42,858,604 |
|
43,905,558 |
|
73,102,409 |
|
74,796,047 |
| ||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Beginning of Year |
|
1,044,372,214 |
|
770,008,055 |
|
176,509,190 |
|
132,603,632 |
|
313,122,387 |
|
238,326,340 |
| ||||||
End of Year |
|
$ |
1,207,544,897 |
|
$ |
1,044,372,214 |
|
$ |
219,367,794 |
|
$ |
176,509,190 |
|
$ |
386,224,796 |
|
$ |
313,122,387 |
|
See Notes to Financial Statements
SEPARATE ACCOUNT A
STATEMENTS OF CHANGES IN NET ASSETS (Continued)
|
|
Variable Accounts |
| ||||||||||||||||
|
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
| ||||||
|
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
| |||||||
|
|
|
2019 |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
| |||||||
|
|
Large-Cap Growth |
|
Large-Cap Value |
|
Main Street Core |
| ||||||||||||
|
|
Class I |
|
Class I |
|
Class I |
| ||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Net investment income (loss) |
|
$ |
(3,228,939 |
) |
$ |
(2,684,964 |
) |
$ |
(2,479,727 |
) |
$ |
(2,692,115 |
) |
$ |
(3,680,503 |
) |
$ |
(3,914,989 |
) |
Realized gain (loss) on investments |
|
3,459,189 |
|
641,102 |
|
10,222,123 |
|
12,191,025 |
|
31,711,499 |
|
23,666,566 |
| ||||||
Change in net unrealized appreciation (depreciation) on investments |
|
76,159,983 |
|
52,039,834 |
|
122,931 |
|
36,020,545 |
|
2,382,300 |
|
53,673,036 |
| ||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
76,390,233 |
|
49,995,972 |
|
7,865,327 |
|
45,519,455 |
|
30,413,296 |
|
73,424,613 |
| ||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payments received from contract owners |
|
21,673,074 |
|
19,778,014 |
|
8,202,399 |
|
8,084,377 |
|
5,414,354 |
|
5,747,979 |
| ||||||
Transfers between variable and fixed accounts, net |
|
4,671,526 |
|
1,197,025 |
|
582,237 |
|
(3,031,402 |
) |
(14,444,016 |
) |
(6,901,060 |
) | ||||||
Contract benefits and terminations |
|
(23,161,816 |
) |
(20,847,400 |
) |
(21,563,512 |
) |
(21,393,980 |
) |
(30,881,828 |
) |
(31,896,687 |
) | ||||||
Contract charges and deductions |
|
(248,723 |
) |
(209,328 |
) |
(178,117 |
) |
(203,227 |
) |
(429,142 |
) |
(465,842 |
) | ||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
(22,413 |
) |
(5,939 |
) |
(19,926 |
) |
680 |
|
(3,474 |
) |
2,529 |
| ||||||
Other |
|
1,549 |
|
(561 |
) |
12,603 |
|
5,589 |
|
5,141 |
|
3,374 |
| ||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
2,913,197 |
|
(88,189 |
) |
(12,964,316 |
) |
(16,537,963 |
) |
(40,338,965 |
) |
(33,509,707 |
) | ||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
79,303,430 |
|
49,907,783 |
|
(5,098,989 |
) |
28,981,492 |
|
(9,925,669 |
) |
39,914,906 |
| ||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Beginning of Year |
|
213,262,358 |
|
163,354,575 |
|
205,659,391 |
|
176,677,899 |
|
293,457,670 |
|
253,542,764 |
| ||||||
End of Year |
|
$ |
292,565,788 |
|
$ |
213,262,358 |
|
$ |
200,560,402 |
|
$ |
205,659,391 |
|
$ |
283,532,001 |
|
$ |
293,457,670 |
|
|
|
Mid-Cap Equity |
|
Mid-Cap Growth |
|
Mid-Cap Value |
| ||||||||||||
|
|
Class I |
|
Class I |
|
Class I |
| ||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Net investment income (loss) |
|
$ |
(2,699,330 |
) |
$ |
(2,871,655 |
) |
$ |
(3,405,139 |
) |
$ |
(3,028,196 |
) |
$ |
(972,096 |
) |
$ |
(1,148,992 |
) |
Realized gain (loss) on investments |
|
16,449,180 |
|
10,849,012 |
|
25,600,264 |
|
10,715,391 |
|
5,644,514 |
|
1,842,064 |
| ||||||
Change in net unrealized appreciation (depreciation) on investments |
|
34,815,939 |
|
27,593,568 |
|
91,255,564 |
|
64,095,735 |
|
(2,750,116 |
) |
21,086,017 |
| ||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
48,565,789 |
|
35,570,925 |
|
113,450,689 |
|
71,782,930 |
|
1,922,302 |
|
21,779,089 |
| ||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payments received from contract owners |
|
8,398,140 |
|
9,090,096 |
|
19,167,403 |
|
15,945,630 |
|
4,108,125 |
|
6,047,964 |
| ||||||
Transfers between variable and fixed accounts, net |
|
(10,640,577 |
) |
(1,246,550 |
) |
(21,884,417 |
) |
(3,456,831 |
) |
(6,839,670 |
) |
2,806,864 |
| ||||||
Contract benefits and terminations |
|
(20,355,680 |
) |
(22,454,720 |
) |
(26,566,749 |
) |
(23,881,624 |
) |
(11,024,230 |
) |
(10,103,365 |
) | ||||||
Contract charges and deductions |
|
(225,606 |
) |
(247,525 |
) |
(608,172 |
) |
(617,436 |
) |
(132,941 |
) |
(157,065 |
) | ||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
(22,891 |
) |
1,457 |
|
(997 |
) |
458 |
|
305 |
|
223 |
| ||||||
Other |
|
404 |
|
374 |
|
11,779 |
|
1,674 |
|
1,256 |
|
2,764 |
| ||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
(22,846,210 |
) |
(14,856,868 |
) |
(29,881,153 |
) |
(12,008,129 |
) |
(13,887,155 |
) |
(1,402,615 |
) | ||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
25,719,579 |
|
20,714,057 |
|
83,569,536 |
|
59,774,801 |
|
(11,964,853 |
) |
20,376,474 |
| ||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Beginning of Year |
|
209,138,478 |
|
188,424,421 |
|
258,256,271 |
|
198,481,470 |
|
97,366,796 |
|
76,990,322 |
| ||||||
End of Year |
|
$ |
234,858,057 |
|
$ |
209,138,478 |
|
$ |
341,825,807 |
|
$ |
258,256,271 |
|
$ |
85,401,943 |
|
$ |
97,366,796 |
|
See Notes to Financial Statements
SEPARATE ACCOUNT A
STATEMENTS OF CHANGES IN NET ASSETS (Continued)
|
|
Variable Accounts |
| ||||||||||||||||
|
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
| ||||||
|
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
| |||||||
|
|
|
2019 |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
| |||||||
|
|
Small-Cap Equity |
|
Small-Cap Growth |
|
Small-Cap Index |
| ||||||||||||
|
|
Class I |
|
Class I |
|
Class I |
| ||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Net investment income (loss) |
|
$ |
(577,693 |
) |
$ |
(652,081 |
) |
$ |
(1,457,813 |
) |
$ |
(1,480,096 |
) |
$ |
(2,727,910 |
) |
$ |
(2,862,466 |
) |
Realized gain (loss) on investments |
|
786,137 |
|
122,425 |
|
12,895,889 |
|
7,477,502 |
|
5,054,124 |
|
264,297 |
| ||||||
Change in net unrealized appreciation (depreciation) on investments |
|
2,239,736 |
|
10,618,712 |
|
43,331,345 |
|
23,832,961 |
|
39,293,645 |
|
46,361,481 |
| ||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
2,448,180 |
|
10,089,056 |
|
54,769,421 |
|
29,830,367 |
|
41,619,859 |
|
43,763,312 |
| ||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payments received from contract owners |
|
2,772,665 |
|
4,674,007 |
|
6,590,987 |
|
7,110,205 |
|
13,911,734 |
|
18,874,448 |
| ||||||
Transfers between variable and fixed accounts, net |
|
(68,486 |
) |
628,518 |
|
(9,571,378 |
) |
(6,644,010 |
) |
(2,811,458 |
) |
5,110,243 |
| ||||||
Contract benefits and terminations |
|
(4,724,111 |
) |
(5,625,326 |
) |
(12,450,273 |
) |
(12,380,980 |
) |
(19,875,818 |
) |
(21,856,016 |
) | ||||||
Contract charges and deductions |
|
(75,776 |
) |
(84,322 |
) |
(354,884 |
) |
(388,814 |
) |
(197,969 |
) |
(214,983 |
) | ||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
38 |
|
41 |
|
(67 |
) |
1,083 |
|
(9,130 |
) |
1,787 |
| ||||||
Other |
|
1,123 |
|
755 |
|
(3,593 |
) |
(1,471 |
) |
17,178 |
|
1,629 |
| ||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
(2,094,547 |
) |
(406,327 |
) |
(15,789,208 |
) |
(12,303,987 |
) |
(8,965,463 |
) |
1,917,108 |
| ||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
353,633 |
|
9,682,729 |
|
38,980,213 |
|
17,526,380 |
|
32,654,396 |
|
45,680,420 |
| ||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Beginning of Year |
|
54,430,618 |
|
44,747,889 |
|
116,165,093 |
|
98,638,713 |
|
233,189,346 |
|
187,508,926 |
| ||||||
End of Year |
|
$ |
54,784,251 |
|
$ |
54,430,618 |
|
$ |
155,145,306 |
|
$ |
116,165,093 |
|
$ |
265,843,742 |
|
$ |
233,189,346 |
|
|
|
Small-Cap Value |
|
Value |
|
Value Advantage |
| ||||||||||||
|
|
Class I |
|
Class I |
|
Class I |
| ||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Net investment income (loss) |
|
$ |
(1,207,879 |
) |
$ |
(1,492,370 |
) |
$ |
(1,766,520 |
) |
$ |
(2,045,002 |
) |
$ |
(419,327 |
) |
$ |
(416,125 |
) |
Realized gain (loss) on investments |
|
4,917,769 |
|
3,686,211 |
|
6,315,968 |
|
7,216,886 |
|
(1,071,360 |
) |
(63,403 |
) | ||||||
Change in net unrealized appreciation (depreciation) on investments |
|
(2,362,374 |
) |
18,413,975 |
|
(17,471,635 |
) |
34,265,874 |
|
(156,195 |
) |
8,512,730 |
| ||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
1,347,516 |
|
20,607,816 |
|
(12,922,187 |
) |
39,437,758 |
|
(1,646,882 |
) |
8,033,202 |
| ||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payments received from contract owners |
|
3,525,593 |
|
4,729,999 |
|
3,545,294 |
|
5,095,930 |
|
4,519,780 |
|
4,823,709 |
| ||||||
Transfers between variable and fixed accounts, net |
|
312,630 |
|
2,489,026 |
|
4,713,485 |
|
(941,803 |
) |
3,379,381 |
|
3,450,630 |
| ||||||
Contract benefits and terminations |
|
(11,391,611 |
) |
(12,030,499 |
) |
(15,879,434 |
) |
(17,526,465 |
) |
(2,310,263 |
) |
(3,206,234 |
) | ||||||
Contract charges and deductions |
|
(153,557 |
) |
(175,367 |
) |
(807,130 |
) |
(937,714 |
) |
(42,586 |
) |
(37,619 |
) | ||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
(2,550 |
) |
730 |
|
(5,506 |
) |
(960 |
) |
109 |
|
(3,291 |
) | ||||||
Other |
|
139 |
|
2,314 |
|
8,562 |
|
1,729 |
|
(3,311 |
) |
6,816 |
| ||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
(7,709,356 |
) |
(4,983,797 |
) |
(8,424,729 |
) |
(14,309,283 |
) |
5,543,110 |
|
5,034,011 |
| ||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
(6,361,840 |
) |
15,624,019 |
|
(21,346,916 |
) |
25,128,475 |
|
3,896,228 |
|
13,067,213 |
| ||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Beginning of Year |
|
114,480,115 |
|
98,856,096 |
|
197,827,146 |
|
172,698,671 |
|
42,826,045 |
|
29,758,832 |
| ||||||
End of Year |
|
$ |
108,118,275 |
|
$ |
114,480,115 |
|
$ |
176,480,230 |
|
$ |
197,827,146 |
|
$ |
46,722,273 |
|
$ |
42,826,045 |
|
See Notes to Financial Statements
SEPARATE ACCOUNT A
STATEMENTS OF CHANGES IN NET ASSETS (Continued)
|
|
Variable Accounts |
| ||||||||||||||||
|
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
| ||||||
|
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
| |||||||
|
|
|
2019 |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
| |||||||
|
|
Emerging Markets |
|
International Large-Cap |
|
International Small-Cap |
| ||||||||||||
|
|
Class I |
|
Class I |
|
Class I |
| ||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Net investment income (loss) |
|
$ |
(2,302,089 |
) |
$ |
(2,521,763 |
) |
$ |
(2,869,752 |
) |
$ |
(3,023,183 |
) |
$ |
(479,880 |
) |
$ |
(536,718 |
) |
Realized gain (loss) on investments |
|
17,227,354 |
|
15,896,897 |
|
11,737,640 |
|
15,809,517 |
|
2,151,523 |
|
953,807 |
| ||||||
Change in net unrealized appreciation (depreciation) on investments |
|
11,987,853 |
|
27,538,087 |
|
14,716,462 |
|
46,172,447 |
|
1,281,460 |
|
6,306,416 |
| ||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
26,913,118 |
|
40,913,221 |
|
23,584,350 |
|
58,958,781 |
|
2,953,103 |
|
6,723,505 |
| ||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payments received from contract owners |
|
7,112,411 |
|
8,998,870 |
|
8,342,126 |
|
8,531,663 |
|
1,479,563 |
|
2,577,963 |
| ||||||
Transfers between variable and fixed accounts, net |
|
(9,226,656 |
) |
(7,806,714 |
) |
(222,301 |
) |
(8,791,122 |
) |
(1,350,890 |
) |
244,213 |
| ||||||
Contract benefits and terminations |
|
(19,438,929 |
) |
(20,952,045 |
) |
(24,513,615 |
) |
(25,501,362 |
) |
(3,594,102 |
) |
(4,550,307 |
) | ||||||
Contract charges and deductions |
|
(353,381 |
) |
(396,421 |
) |
(945,903 |
) |
(1,051,363 |
) |
(110,874 |
) |
(132,731 |
) | ||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
(8,227 |
) |
223 |
|
(11,198 |
) |
(1,686 |
) |
94 |
|
(1,598 |
) | ||||||
Other |
|
18,899 |
|
12,543 |
|
7,995 |
|
11,766 |
|
(5,062 |
) |
2,377 |
| ||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
(21,895,883 |
) |
(20,143,544 |
) |
(17,342,896 |
) |
(26,802,104 |
) |
(3,581,271 |
) |
(1,860,083 |
) | ||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
5,017,235 |
|
20,769,677 |
|
6,241,454 |
|
32,156,677 |
|
(628,168 |
) |
4,863,422 |
| ||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Beginning of Year |
|
199,638,291 |
|
178,868,614 |
|
264,096,383 |
|
231,939,706 |
|
41,971,971 |
|
37,108,549 |
| ||||||
End of Year |
|
$ |
204,655,526 |
|
$ |
199,638,291 |
|
$ |
270,337,837 |
|
$ |
264,096,383 |
|
$ |
41,343,803 |
|
$ |
41,971,971 |
|
|
|
International Value |
|
Health Sciences |
|
Real Estate |
| ||||||||||||||
|
|
Class I |
|
Class I |
|
Class I |
| ||||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
Net investment income (loss) |
|
$ |
(1,241,977 |
) |
$ |
(1,473,188 |
) |
$ |
(4,034,519 |
) |
$ |
(3,939,586 |
) |
$ |
(1,690,557 |
) |
$ |
(1,951,247 |
) | ||
Realized gain (loss) on investments |
|
1,879,749 |
|
2,060,677 |
|
26,190,175 |
|
24,164,649 |
|
9,720,560 |
|
9,884,493 |
| ||||||||
Change in net unrealized appreciation (depreciation) on investments |
|
(8,783,466 |
) |
14,799,053 |
|
23,121,519 |
|
40,966,268 |
|
(15,202,283 |
) |
26,656,251 |
| ||||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
(8,145,694 |
) |
15,386,542 |
|
45,277,175 |
|
61,191,331 |
|
(7,172,280 |
) |
34,589,497 |
| ||||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
Payments received from contract owners |
|
3,192,998 |
|
4,558,056 |
|
15,708,997 |
|
15,054,047 |
|
4,705,820 |
|
5,139,000 |
| ||||||||
Transfers between variable and fixed accounts, net |
|
5,890,688 |
|
4,192,232 |
|
(8,773,048 |
) |
(10,405,501 |
) |
(1,790,737 |
) |
604,720 |
| ||||||||
Contract benefits and terminations |
|
(10,930,293 |
) |
(13,103,918 |
) |
(33,989,929 |
) |
(33,439,251 |
) |
(14,651,419 |
) |
(17,500,891 |
) | ||||||||
Contract charges and deductions |
|
(200,326 |
) |
(228,039 |
) |
(321,039 |
) |
(337,254 |
) |
(217,440 |
) |
(251,700 |
) | ||||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
(5,038 |
) |
966 |
|
(1,359 |
) |
(103 |
) |
(8,975 |
) |
1,025 |
| ||||||||
Other |
|
2,224 |
|
7,596 |
|
10,161 |
|
9,117 |
|
(2,949 |
) |
(1,011 |
) | ||||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
(2,049,747 |
) |
(4,573,107 |
) |
(27,366,217 |
) |
(29,118,945 |
) |
(11,965,700 |
) |
(12,008,857 |
) | ||||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
(10,195,441 |
) |
10,813,435 |
|
17,910,958 |
|
32,072,386 |
|
(19,137,980 |
) |
22,580,640 |
| ||||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
Beginning of Year |
|
114,596,679 |
|
103,783,244 |
|
301,373,616 |
|
269,301,230 |
|
143,979,376 |
|
121,398,736 |
| ||||||||
End of Year |
|
$ |
104,401,238 |
|
$ |
114,596,679 |
|
$ |
319,284,574 |
|
$ |
301,373,616 |
|
$ |
124,841,396 |
|
$ |
143,979,376 |
| ||
See Notes to Financial Statements
SEPARATE ACCOUNT A |
|||||||
STATEMENTS OF CHANGES IN NET ASSETS (Continued) |
|
|
|
|
|
|
|
Variable Accounts |
| ||||||||||||||||
|
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
| ||||||
|
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
| |||||||
|
|
|
2019 |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
| |||||||
|
|
Technology |
|
PSF DFA |
|
Pacific Dynamix - |
| ||||||||||||
|
|
Class I |
|
Balanced Allocation Class D |
|
Conservative Growth Class I |
| ||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Net investment income (loss) |
|
$ |
(2,330,555 |
) |
$ |
(1,793,897 |
) |
$ |
(2,942,439 |
) |
$ |
(2,307,807 |
) |
$ |
(6,323,696 |
) |
$ |
(6,020,289 |
) |
Realized gain (loss) on investments |
|
596,052 |
|
1,533,277 |
|
(971,568 |
) |
(124,000 |
) |
556,255 |
|
4,667,388 |
| ||||||
Change in net unrealized appreciation (depreciation) on investments |
|
66,474,733 |
|
37,251,259 |
|
32,472,672 |
|
32,783,837 |
|
60,767,724 |
|
64,271,206 |
| ||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
64,740,230 |
|
36,990,639 |
|
28,558,665 |
|
30,352,030 |
|
55,000,283 |
|
62,918,305 |
| ||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payments received from contract owners |
|
15,498,475 |
|
10,284,341 |
|
40,967,833 |
|
46,180,423 |
|
32,055,885 |
|
30,855,665 |
| ||||||
Transfers between variable and fixed accounts, net |
|
4,550,378 |
|
(788,861 |
) |
10,995,938 |
|
9,743,093 |
|
33,734,557 |
|
23,619,669 |
| ||||||
Contract benefits and terminations |
|
(18,090,288 |
) |
(13,073,742 |
) |
(14,709,585 |
) |
(12,205,701 |
) |
(56,645,077 |
) |
(67,445,872 |
) | ||||||
Contract charges and deductions |
|
(205,592 |
) |
(192,971 |
) |
(1,647,951 |
) |
(1,117,078 |
) |
(2,879,262 |
) |
(2,671,486 |
) | ||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
37 |
|
59 |
|
118 |
|
106 |
|
494 |
|
399 |
| ||||||
Other |
|
2,515 |
|
1,492 |
|
6,443 |
|
5,390 |
|
(21,852 |
) |
2,487 |
| ||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
1,755,525 |
|
(3,769,682 |
) |
35,612,796 |
|
42,606,233 |
|
6,244,745 |
|
(15,639,138 |
) | ||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
66,495,755 |
|
33,220,957 |
|
64,171,461 |
|
72,958,263 |
|
61,245,028 |
|
47,279,167 |
| ||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Beginning of Year |
|
142,235,523 |
|
109,014,566 |
|
223,629,160 |
|
150,670,897 |
|
504,881,921 |
|
457,602,754 |
| ||||||
End of Year |
|
$ |
208,731,278 |
|
$ |
142,235,523 |
|
$ |
287,800,621 |
|
$ |
223,629,160 |
|
$ |
566,126,949 |
|
$ |
504,881,921 |
|
|
|
Pacific Dynamix - |
|
Pacific Dynamix - |
|
Portfolio Optimization |
| ||||||||||||
|
|
Moderate Growth Class I |
|
Growth Class I |
|
Conservative Class I |
| ||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Net investment income (loss) |
|
$ |
(27,605,616 |
) |
$ |
(27,162,826 |
) |
$ |
(10,689,872 |
) |
$ |
(8,828,785 |
) |
$ |
(21,600,024 |
) |
$ |
(20,702,405 |
) |
Realized gain (loss) on investments |
|
34,523,430 |
|
17,781,181 |
|
(4,233,295 |
) |
7,345,065 |
|
18,364,494 |
|
33,691,285 |
| ||||||
Change in net unrealized appreciation (depreciation) on investments |
|
282,106,534 |
|
360,980,324 |
|
161,747,483 |
|
131,820,118 |
|
106,413,033 |
|
129,103,971 |
| ||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
289,024,348 |
|
351,598,679 |
|
146,824,316 |
|
130,336,398 |
|
103,177,503 |
|
142,092,851 |
| ||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payments received from contract owners |
|
153,298,517 |
|
169,988,212 |
|
259,936,638 |
|
56,447,243 |
|
32,231,067 |
|
21,492,662 |
| ||||||
Transfers between variable and fixed accounts, net |
|
(28,890,361 |
) |
20,762,062 |
|
6,232,444 |
|
16,206,414 |
|
229,891,117 |
|
130,768,379 |
| ||||||
Contract benefits and terminations |
|
(213,623,140 |
) |
(273,007,240 |
) |
(57,844,960 |
) |
(77,530,075 |
) |
(235,218,174 |
) |
(263,198,267 |
) | ||||||
Contract charges and deductions |
|
(16,847,546 |
) |
(15,845,322 |
) |
(4,557,797 |
) |
(3,461,728 |
) |
(11,320,645 |
) |
(10,234,028 |
) | ||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
606 |
|
467 |
|
(1,424 |
) |
135 |
|
(3,301 |
) |
(4,517 |
) | ||||||
Other |
|
44,832 |
|
48,959 |
|
(35,067 |
) |
6,808 |
|
2,046 |
|
38,945 |
| ||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
(106,017,092 |
) |
(98,052,862 |
) |
203,729,834 |
|
(8,331,203 |
) |
15,582,110 |
|
(121,136,826 |
) | ||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
183,007,256 |
|
253,545,817 |
|
350,554,150 |
|
122,005,195 |
|
118,759,613 |
|
20,956,025 |
| ||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Beginning of Year |
|
2,309,891,015 |
|
2,056,345,198 |
|
744,887,106 |
|
622,881,911 |
|
1,415,956,727 |
|
1,395,000,702 |
| ||||||
End of Year |
|
$ |
2,492,898,271 |
|
$ |
2,309,891,015 |
|
$ |
1,095,441,256 |
|
$ |
744,887,106 |
|
$ |
1,534,716,340 |
|
$ |
1,415,956,727 |
|
See Notes to Financial Statements
SEPARATE ACCOUNT A |
|||||||
STATEMENTS OF CHANGES IN NET ASSETS (Continued) |
|
|
|
|
|
|
|
Variable Accounts |
| ||||||||||||||||||
|
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
| ||||||||
|
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
| |||||||||
|
|
|
2019 |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
| |||||||||
|
|
Portfolio Optimization |
|
Portfolio Optimization |
|
Portfolio Optimization |
| ||||||||||||||
|
|
Moderate-Conservative Class I |
|
Moderate Class I |
|
Growth Class I |
| ||||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
Net investment income (loss) |
|
$ |
(29,528,009 |
) |
$ |
(31,987,927 |
) |
$ |
(123,934,497 |
) |
$ |
(133,770,746 |
) |
$ |
(108,559,051 |
) |
$ |
(118,120,973 |
) | ||
Realized gain (loss) on investments |
|
94,230,169 |
|
103,989,134 |
|
455,239,144 |
|
521,997,856 |
|
421,269,970 |
|
494,733,593 |
| ||||||||
Change in net unrealized appreciation (depreciation) on investments |
|
99,453,290 |
|
213,987,670 |
|
485,699,500 |
|
1,033,973,745 |
|
434,746,926 |
|
1,027,863,008 |
| ||||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
164,155,450 |
|
285,988,877 |
|
817,004,147 |
|
1,422,200,855 |
|
747,457,845 |
|
1,404,475,628 |
| ||||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
Payments received from contract owners |
|
27,282,223 |
|
33,801,110 |
|
105,136,897 |
|
132,086,090 |
|
96,704,393 |
|
71,883,201 |
| ||||||||
Transfers between variable and fixed accounts, net |
|
4,251,809 |
|
32,420,540 |
|
(76,170,785 |
) |
(96,482,818 |
) |
(160,181,372 |
) |
(142,656,630 |
) | ||||||||
Contract benefits and terminations |
|
(250,150,035 |
) |
(343,507,375 |
) |
(947,182,037 |
) |
(1,228,944,796 |
) |
(699,662,161 |
) |
(924,140,205 |
) | ||||||||
Contract charges and deductions |
|
(13,715,275 |
) |
(14,683,524 |
) |
(62,482,781 |
) |
(66,921,835 |
) |
(55,152,609 |
) |
(59,204,879 |
) | ||||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
(18,838 |
) |
(6,237 |
) |
(138,801 |
) |
(35,569 |
) |
(154,494 |
) |
5,607 |
| ||||||||
Other |
|
56,390 |
|
65,451 |
|
254,901 |
|
168,035 |
|
211,006 |
|
63,011 |
| ||||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
(232,293,726 |
) |
(291,910,035 |
) |
(980,582,606 |
) |
(1,260,130,893 |
) |
(818,235,237 |
) |
(1,054,049,895 |
) | ||||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
(68,138,276 |
) |
(5,921,158 |
) |
(163,578,459 |
) |
162,069,962 |
|
(70,777,392 |
) |
350,425,733 |
| ||||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
Beginning of Year |
|
2,202,281,279 |
|
2,208,202,437 |
|
9,125,390,297 |
|
8,963,320,335 |
|
7,818,850,939 |
|
7,468,425,206 |
| ||||||||
End of Year |
|
$ |
2,134,143,003 |
|
$ |
2,202,281,279 |
|
$ |
8,961,811,838 |
|
$ |
9,125,390,297 |
|
$ |
7,748,073,547 |
|
$ |
7,818,850,939 |
| ||
|
|
Portfolio Optimization |
|
Invesco Oppenheimer V.I. |
|
Invesco Oppenheimer V.I. |
| |||||||||||||
|
|
Aggressive-Growth Class I |
|
Global Series II |
|
International Growth Series II |
| |||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
Net investment income (loss) |
|
$ |
(22,751,198 |
) |
$ |
(25,145,804 |
) |
$ |
(157,944 |
) |
$ |
(117,153 |
) |
$ |
(75,591 |
) |
$ |
(61,496 |
) | |
Realized gain (loss) on investments |
|
98,913,707 |
|
120,793,208 |
|
392,302 |
|
2,282,178 |
|
100,666 |
|
326,499 |
| |||||||
Change in net unrealized appreciation (depreciation) on investments |
|
75,816,071 |
|
230,365,454 |
|
4,314,440 |
|
2,614,115 |
|
3,014,412 |
|
2,807,889 |
| |||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
151,978,580 |
|
326,012,858 |
|
4,548,798 |
|
4,779,140 |
|
3,039,487 |
|
3,072,892 |
| |||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
Payments received from contract owners |
|
17,766,875 |
|
17,028,072 |
|
1,174,324 |
|
2,549,428 |
|
1,692,819 |
|
1,100,151 |
| |||||||
Transfers between variable and fixed accounts, net |
|
(56,107,600 |
) |
(54,358,893 |
) |
(3,210,169 |
) |
659,959 |
|
274,263 |
|
(277,392 |
) | |||||||
Contract benefits and terminations |
|
(136,060,474 |
) |
(198,188,226 |
) |
(1,149,688 |
) |
(1,907,802 |
) |
(1,064,152 |
) |
(877,709 |
) | |||||||
Contract charges and deductions |
|
(10,154,861 |
) |
(10,905,620 |
) |
(7,449 |
) |
(8,381 |
) |
(4,561 |
) |
(4,658 |
) | |||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
(191,154 |
) |
284 |
|
(2,392 |
) |
— |
|
— |
|
— |
| |||||||
Other |
|
89,125 |
|
33,055 |
|
957 |
|
(576 |
) |
119 |
|
(31 |
) | |||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
(184,658,089 |
) |
(246,391,328 |
) |
(3,194,417 |
) |
1,292,628 |
|
898,488 |
|
(59,639 |
) | |||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
(32,679,509 |
) |
79,621,530 |
|
1,354,381 |
|
6,071,768 |
|
3,937,975 |
|
3,013,253 |
| |||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
Beginning of Year |
|
1,659,745,072 |
|
1,580,123,542 |
|
21,391,688 |
|
15,319,920 |
|
14,698,332 |
|
11,685,079 |
| |||||||
End of Year |
|
$ |
1,627,065,563 |
|
$ |
1,659,745,072 |
|
$ |
22,746,069 |
|
$ |
21,391,688 |
|
$ |
18,636,307 |
|
$ |
14,698,332 |
| |
See Notes to Financial Statements
SEPARATE ACCOUNT A
STATEMENTS OF CHANGES IN NET ASSETS (Continued)
|
|
Variable Accounts |
| |||||||||||||||||
|
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
| |||||||
|
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
| ||||||||
|
|
|
2019 |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
| ||||||||
|
|
Invesco V.I. Balanced-Risk |
|
Invesco V.I. Equity and |
|
Invesco V.I. Global |
| |||||||||||||
|
|
Allocation Series II |
|
Income Series II |
|
Real Estate Series II |
| |||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
Net investment income (loss) |
|
$ |
18,670,947 |
|
$ |
(4,480,451 |
) |
$ |
555,038 |
|
$ |
610,643 |
|
$ |
275,675 |
|
$ |
192,794 |
| |
Realized gain (loss) on investments |
|
12,024,934 |
|
(5,911,698 |
) |
1,271,375 |
|
3,188,899 |
|
(252,549 |
) |
(4,611 |
) | |||||||
Change in net unrealized appreciation (depreciation) on investments |
|
(7,262,740 |
) |
51,005,588 |
|
2,298,206 |
|
4,240,682 |
|
(1,370,050 |
) |
1,229,712 |
| |||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
23,433,141 |
|
40,613,439 |
|
4,124,619 |
|
8,040,224 |
|
(1,346,924 |
) |
1,417,895 |
| |||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
Payments received from contract owners |
|
15,856,082 |
|
14,994,314 |
|
2,307,070 |
|
4,792,010 |
|
824,652 |
|
1,568,529 |
| |||||||
Transfers between variable and fixed accounts, net |
|
(8,511,707 |
) |
(9,380,915 |
) |
207,657 |
|
1,580,528 |
|
(202,901 |
) |
984,892 |
| |||||||
Contract benefits and terminations |
|
(33,569,813 |
) |
(45,114,423 |
) |
(3,305,657 |
) |
(3,682,780 |
) |
(887,694 |
) |
(663,732 |
) | |||||||
Contract charges and deductions |
|
(2,733,668 |
) |
(2,852,078 |
) |
(87,580 |
) |
(79,209 |
) |
(1,273 |
) |
(1,535 |
) | |||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
— |
|
— |
|
90 |
|
86 |
|
— |
|
— |
| |||||||
Other |
|
(8,666 |
) |
4,507 |
|
(1,310 |
) |
717 |
|
(7,577 |
) |
(1,736 |
) | |||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
(28,967,772 |
) |
(42,348,595 |
) |
(879,730 |
) |
2,611,352 |
|
(274,793 |
) |
1,886,418 |
| |||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
(5,534,631 |
) |
(1,735,156 |
) |
3,244,889 |
|
10,651,576 |
|
(1,621,717 |
) |
3,304,313 |
| |||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
Beginning of Year |
|
320,444,489 |
|
322,179,645 |
|
51,983,779 |
|
41,332,203 |
|
9,561,900 |
|
6,257,587 |
| |||||||
End of Year |
|
$ |
314,909,858 |
|
$ |
320,444,489 |
|
$ |
55,228,668 |
|
$ |
51,983,779 |
|
$ |
7,940,183 |
|
$ |
9,561,900 |
| |
|
|
American Century |
|
American Funds IS Asset |
|
American Funds IS Blue Chip |
| ||||||||||||
|
|
VP Mid Cap Value Class II |
|
Allocation Class 4 |
|
Income and Growth Class 4 |
| ||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Net investment income (loss) |
|
$ |
342,875 |
|
$ |
531,027 |
|
$ |
5,838,823 |
|
$ |
13,156,561 |
|
$ |
641,516 |
|
$ |
974,095 |
|
Realized gain (loss) on investments |
|
(1,826,307 |
) |
7,362,078 |
|
13,685,944 |
|
152,513,091 |
|
(1,376,711 |
) |
6,961,741 |
| ||||||
Change in net unrealized appreciation (depreciation) on investments |
|
826,479 |
|
11,064,586 |
|
326,844,534 |
|
373,417,930 |
|
10,456,217 |
|
10,995,656 |
| ||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
(656,953 |
) |
18,957,691 |
|
346,369,301 |
|
539,087,582 |
|
9,721,022 |
|
18,931,492 |
| ||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payments received from contract owners |
|
5,719,434 |
|
6,714,084 |
|
271,128,746 |
|
276,911,870 |
|
16,107,446 |
|
20,895,218 |
| ||||||
Transfers between variable and fixed accounts, net |
|
(2,498,178 |
) |
2,590,972 |
|
(15,686,714 |
) |
74,765,112 |
|
2,095,594 |
|
8,482,890 |
| ||||||
Contract benefits and terminations |
|
(6,983,362 |
) |
(9,045,887 |
) |
(297,994,808 |
) |
(367,758,880 |
) |
(9,222,226 |
) |
(7,525,990 |
) | ||||||
Contract charges and deductions |
|
(32,568 |
) |
(32,812 |
) |
(26,441,788 |
) |
(24,067,231 |
) |
(116,410 |
) |
(87,826 |
) | ||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
— |
|
— |
|
(41,780 |
) |
170 |
|
154 |
|
152 |
| ||||||
Other |
|
1,909 |
|
(874 |
) |
(116,539 |
) |
93,927 |
|
(32,768 |
) |
(736 |
) | ||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
(3,792,765 |
) |
225,483 |
|
(69,152,883 |
) |
(40,055,032 |
) |
8,831,790 |
|
21,763,708 |
| ||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
(4,449,718 |
) |
19,183,174 |
|
277,216,418 |
|
499,032,550 |
|
18,552,812 |
|
40,695,200 |
| ||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Beginning of Year |
|
88,473,524 |
|
69,290,350 |
|
3,309,209,188 |
|
2,810,176,638 |
|
126,418,067 |
|
85,722,867 |
| ||||||
End of Year |
|
$ |
84,023,806 |
|
$ |
88,473,524 |
|
$ |
3,586,425,606 |
|
$ |
3,309,209,188 |
|
$ |
144,970,879 |
|
$ |
126,418,067 |
|
See Notes to Financial Statements
SEPARATE ACCOUNT A |
|||||||
STATEMENTS OF CHANGES IN NET ASSETS (Continued) |
|
|
|
|
|
|
|
Variable Accounts |
| ||||||||||||||||
|
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
| ||||||
|
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
| |||||||
|
|
|
2019 |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
| |||||||
|
|
American Funds IS |
|
American Funds IS Capital |
|
American Funds IS |
| ||||||||||||
|
|
Bond Class 4 |
|
Income Builder Class 4 |
|
Capital World Bond Class 4 |
| ||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Net investment income (loss) |
|
$ |
1,110,043 |
|
$ |
1,014,772 |
|
$ |
1,599,452 |
|
$ |
1,548,517 |
|
$ |
13,963 |
|
$ |
55,807 |
|
Realized gain (loss) on investments |
|
686,042 |
|
(146,598 |
) |
(511,174 |
) |
(119,521 |
) |
248,254 |
|
(34,570 |
| ||||||
Change in net unrealized appreciation (depreciation) on investments |
|
5,145,199 |
|
3,250,086 |
|
1,688,851 |
|
13,288,392 |
|
1,183,963 |
|
846,823 |
| ||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
6,941,284 |
|
4,118,260 |
|
2,777,129 |
|
14,717,388 |
|
1,446,180 |
|
868,060 |
| ||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payments received from contract owners |
|
19,227,772 |
|
13,845,737 |
|
7,405,902 |
|
13,438,576 |
|
2,431,738 |
|
2,473,684 |
| ||||||
Transfers between variable and fixed accounts, net |
|
30,189,719 |
|
11,940,630 |
|
(642,678 |
) |
5,981,883 |
|
1,388,927 |
|
1,417,452 |
| ||||||
Contract benefits and terminations |
|
(8,959,147 |
) |
(4,478,776 |
) |
(10,469,319 |
) |
(9,348,807 |
) |
(1,122,453 |
) |
(1,515,630 |
) | ||||||
Contract charges and deductions |
|
(128,231 |
) |
(84,533 |
) |
(158,273 |
) |
(145,088 |
) |
(23,915 |
) |
(18,017 |
) | ||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
| ||||||
Other |
|
1,118 |
|
(1,093 |
) |
(4,143 |
) |
(1,658 |
) |
(208 |
) |
(2,030 |
) | ||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
40,331,231 |
|
21,221,965 |
|
(3,868,511 |
) |
9,924,906 |
|
2,674,089 |
|
2,355,459 |
| ||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
47,272,515 |
|
25,340,225 |
|
(1,091,382 |
) |
24,642,294 |
|
4,120,269 |
|
3,223,519 |
| ||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Beginning of Year |
|
71,857,165 |
|
46,516,940 |
|
110,011,255 |
|
85,368,961 |
|
16,045,481 |
|
12,821,962 |
| ||||||
End of Year |
|
$ |
119,129,680 |
|
$ |
71,857,165 |
|
$ |
108,919,873 |
|
$ |
110,011,255 |
|
$ |
20,165,750 |
|
$ |
16,045,481 |
|
|
|
American Funds IS |
|
American Funds IS Global |
|
American Funds IS |
| |||||||||||||||
|
|
Global Balanced Class 4 |
|
Growth and Income Class 4 |
|
Global Growth Class 4 |
| |||||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Net investment income (loss) |
|
$ |
(125,826 |
) |
$ |
30,201 |
|
$ |
47,370 |
|
$ |
311,733 |
|
$ |
(1,177,135 |
) |
$ |
(140,704 |
) | |||
Realized gain (loss) on investments |
|
2,370,090 |
|
1,573,125 |
|
661,445 |
|
1,439,021 |
|
2,888,784 |
|
4,786,798 |
| |||||||||
Change in net unrealized appreciation (depreciation) on investments |
|
3,279,355 |
|
7,864,830 |
|
3,498,430 |
|
7,343,445 |
|
31,045,962 |
|
22,669,694 |
| |||||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
5,523,619 |
|
9,468,156 |
|
4,207,245 |
|
9,094,199 |
|
32,757,611 |
|
27,315,788 |
| |||||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Payments received from contract owners |
|
6,352,639 |
|
6,464,291 |
|
6,344,676 |
|
7,744,716 |
|
14,805,737 |
|
13,295,277 |
| |||||||||
Transfers between variable and fixed accounts, net |
|
(2,019,163 |
) |
3,334,416 |
|
1,069,922 |
|
2,552,422 |
|
(4,001,600 |
) |
1,395,532 |
| |||||||||
Contract benefits and terminations |
|
(3,552,783 |
) |
(4,023,924 |
) |
(2,380,503 |
) |
(2,629,389 |
) |
(8,285,588 |
) |
(5,778,979 |
) | |||||||||
Contract charges and deductions |
|
(70,378 |
) |
(62,095 |
) |
(49,669 |
) |
(37,844 |
) |
(108,783 |
) |
(80,276 |
) | |||||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
— |
|
— |
|
121 |
|
(3,330 |
) |
133 |
|
83 |
| |||||||||
Other |
|
(1,527 |
) |
(2,554 |
) |
2,893 |
|
507 |
|
180 |
|
(1,631 |
) | |||||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
708,788 |
|
5,710,134 |
|
4,987,440 |
|
7,627,082 |
|
2,410,079 |
|
8,830,006 |
| |||||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
6,232,407 |
|
15,178,290 |
|
9,194,685 |
|
16,721,281 |
|
35,167,690 |
|
36,145,794 |
| |||||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Beginning of Year |
|
63,144,585 |
|
47,966,295 |
|
44,898,187 |
|
28,176,906 |
|
115,088,564 |
|
78,942,770 |
| |||||||||
End of Year |
|
$ |
69,376,992 |
|
$ |
63,144,585 |
|
$ |
54,092,872 |
|
$ |
44,898,187 |
|
$ |
150,256,254 |
|
$ |
115,088,564 |
| |||
See Notes to Financial Statements
SEPARATE ACCOUNT A |
|||||||
STATEMENTS OF CHANGES IN NET ASSETS (Continued) |
|
|
|
|
|
|
|
Variable Accounts |
| ||||||||||||||||||
|
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
| ||||||||
|
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
| |||||||||
|
|
|
2019 |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
| |||||||||
|
|
American Funds IS Global |
|
American Funds IS |
|
American Funds IS |
| ||||||||||||||
|
|
Small Capitalization Class 4 |
|
Growth Class 4 |
|
Growth-Income Class 4 |
| ||||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
Net investment income (loss) |
|
$ |
(241,820 |
) |
$ |
(218,528 |
) |
$ |
(5,235,797 |
) |
$ |
(2,830,591 |
) |
$ |
(302,169 |
) |
$ |
841,056 |
| ||
Realized gain (loss) on investments |
|
1,434,709 |
|
1,136,567 |
|
12,800,487 |
|
40,694,130 |
|
8,517,584 |
|
35,891,091 |
| ||||||||
Change in net unrealized appreciation (depreciation) on investments |
|
6,763,192 |
|
4,376,435 |
|
206,625,724 |
|
62,883,172 |
|
33,305,119 |
|
40,692,360 |
| ||||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
7,956,081 |
|
5,294,474 |
|
214,190,414 |
|
100,746,711 |
|
41,520,534 |
|
77,424,507 |
| ||||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
Payments received from contract owners |
|
3,148,468 |
|
4,040,048 |
|
48,577,651 |
|
43,587,564 |
|
25,486,948 |
|
28,562,507 |
| ||||||||
Transfers between variable and fixed accounts, net |
|
152,436 |
|
2,095,692 |
|
(14,243,132 |
) |
(3,321,583 |
) |
(10,361,367 |
) |
1,079,214 |
| ||||||||
Contract benefits and terminations |
|
(1,150,063 |
) |
(1,357,215 |
) |
(48,380,256 |
) |
(44,008,477 |
) |
(38,280,335 |
) |
(41,716,475 |
) | ||||||||
Contract charges and deductions |
|
(43,529 |
) |
(31,520 |
) |
(483,855 |
) |
(436,788 |
) |
(411,383 |
) |
(426,881 |
) | ||||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
— |
|
— |
|
239 |
|
(43 |
) |
584 |
|
(9,020 |
) | ||||||||
Other |
|
(647 |
) |
(821 |
) |
51,179 |
|
18,974 |
|
(55,654 |
) |
15,753 |
| ||||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
2,106,665 |
|
4,746,184 |
|
(14,478,174 |
) |
(4,160,353 |
) |
(23,621,207 |
) |
(12,494,902 |
) | ||||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
10,062,746 |
|
10,040,658 |
|
199,712,240 |
|
96,586,358 |
|
17,899,327 |
|
64,929,605 |
| ||||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
Beginning of Year |
|
26,084,787 |
|
16,044,129 |
|
449,220,933 |
|
352,634,575 |
|
388,579,894 |
|
323,650,289 |
| ||||||||
End of Year |
|
$ |
36,147,533 |
|
$ |
26,084,787 |
|
$ |
648,933,173 |
|
$ |
449,220,933 |
|
$ |
406,479,221 |
|
$ |
388,579,894 |
| ||
|
|
American Funds IS High- |
|
American Funds IS |
|
American Funds IS International |
| |||||||||||||
|
|
Income Bond Class 4 |
|
International Class 4 |
|
Growth and Income Class 4 |
| |||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
Net investment income (loss) |
|
$ |
2,148,507 |
|
$ |
1,385,954 |
|
$ |
(516,286 |
) |
$ |
236,765 |
|
$ |
115,830 |
|
$ |
646,659 |
| |
Realized gain (loss) on investments |
|
(705,469 |
) |
(135,695 |
) |
(1,503,867 |
) |
1,049,072 |
|
(732,626 |
) |
343,112 |
| |||||||
Change in net unrealized appreciation (depreciation) on investments |
|
642,185 |
|
1,275,590 |
|
13,253,066 |
|
13,106,527 |
|
3,235,187 |
|
8,384,402 |
| |||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
2,085,223 |
|
2,525,849 |
|
11,232,913 |
|
14,392,364 |
|
2,618,391 |
|
9,374,173 |
| |||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
Payments received from contract owners |
|
3,310,097 |
|
5,120,652 |
|
6,750,644 |
|
7,685,692 |
|
3,805,873 |
|
4,875,278 |
| |||||||
Transfers between variable and fixed accounts, net |
|
511,268 |
|
7,041,522 |
|
(1,766,773 |
) |
14,399,547 |
|
209,941 |
|
2,507,305 |
| |||||||
Contract benefits and terminations |
|
(2,528,716 |
) |
(2,825,582 |
) |
(6,501,503 |
) |
(5,102,235 |
) |
(3,518,942 |
) |
(4,192,452 |
) | |||||||
Contract charges and deductions |
|
(21,505 |
) |
(16,699 |
) |
(205,639 |
) |
(153,530 |
) |
(52,078 |
) |
(51,072 |
) | |||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
— |
|
— |
|
— |
|
— |
|
— |
|
(4,051 |
) | |||||||
Other |
|
48 |
|
296 |
|
2,084 |
|
2,227 |
|
(2,217 |
) |
(2,608 |
) | |||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
1,271,192 |
|
9,320,189 |
|
(1,721,187 |
) |
16,831,701 |
|
442,577 |
|
3,132,400 |
| |||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
3,356,415 |
|
11,846,038 |
|
9,511,726 |
|
31,224,065 |
|
3,060,968 |
|
12,506,573 |
| |||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
Beginning of Year |
|
31,991,057 |
|
20,145,019 |
|
91,758,888 |
|
60,534,823 |
|
55,508,509 |
|
43,001,936 |
| |||||||
End of Year |
|
$ |
35,347,472 |
|
$ |
31,991,057 |
|
$ |
101,270,614 |
|
$ |
91,758,888 |
|
$ |
58,569,477 |
|
$ |
55,508,509 |
| |
See Notes to Financial Statements
SEPARATE ACCOUNT A |
|||||||
STATEMENTS OF CHANGES IN NET ASSETS (Continued) |
|
|
|
|
|
|
|
Variable Accounts |
| ||||||||||||||||
|
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
| ||||||
|
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
| |||||||
|
|
|
2019 |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
| |||||||
|
|
American Funds IS Managed Risk |
|
American Funds IS |
|
American Funds IS U.S. Government/ |
| ||||||||||||
|
|
Asset Allocation Class P2 |
|
New World Fund Class 4 |
|
AAA-Rated Securities Class 4 |
| ||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Net investment income (loss) |
|
$ |
326,585 |
|
$ |
1,266,155 |
|
$ |
(600,415 |
) |
$ |
(194,828 |
) |
$ |
673,748 |
|
$ |
410,897 |
|
Realized gain (loss) on investments |
|
5,105,278 |
|
5,033,477 |
|
337,343 |
|
1,712,659 |
|
2,037,484 |
|
(225,983 |
) | ||||||
Change in net unrealized appreciation (depreciation) on investments |
|
1,911,274 |
|
13,197,011 |
|
12,130,861 |
|
10,526,925 |
|
3,170,057 |
|
1,591,271 |
| ||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
7,343,137 |
|
19,496,643 |
|
11,867,789 |
|
12,044,756 |
|
5,881,289 |
|
1,776,185 |
| ||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payments received from contract owners |
|
19,409,873 |
|
18,531,416 |
|
5,452,734 |
|
5,859,298 |
|
16,815,386 |
|
7,293,428 |
| ||||||
Transfers between variable and fixed accounts, net |
|
4,724,442 |
|
6,130,701 |
|
(3,270,632 |
) |
(504,732 |
) |
72,553,210 |
|
9,154,835 |
| ||||||
Contract benefits and terminations |
|
(12,401,603 |
) |
(13,933,101 |
) |
(3,468,890 |
) |
(2,876,852 |
) |
(30,613,081 |
) |
(9,508,313 |
) | ||||||
Contract charges and deductions |
|
(1,231,489 |
) |
(964,445 |
) |
(46,555 |
) |
(39,914 |
) |
(57,424 |
) |
(27,938 |
) | ||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
51 |
|
44 |
|
18 |
|
(177 |
) |
— |
|
— |
| ||||||
Other |
|
(609 |
) |
(3,809 |
) |
(858 |
) |
1,080 |
|
5,334 |
|
(445 |
) | ||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
10,500,665 |
|
9,760,806 |
|
(1,334,183 |
) |
2,438,703 |
|
58,703,425 |
|
6,911,567 |
| ||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
17,843,802 |
|
29,257,449 |
|
10,533,606 |
|
14,483,459 |
|
64,584,714 |
|
8,687,752 |
| ||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Beginning of Year |
|
144,266,036 |
|
115,008,587 |
|
57,614,643 |
|
43,131,184 |
|
51,395,885 |
|
42,708,133 |
| ||||||
End of Year |
|
$ |
162,109,838 |
|
$ |
144,266,036 |
|
$ |
68,148,249 |
|
$ |
57,614,643 |
|
$ |
115,980,599 |
|
$ |
51,395,885 |
|
|
|
BlackRock 60/40 Target |
|
BlackRock Capital Appreciation |
|
BlackRock Global Allocation |
| ||||||||||||||||
|
|
Allocation ETF V.I. Class I |
|
V.I. Class III |
|
V.I. Class III |
| ||||||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||
Net investment income (loss) |
|
$ |
675,957 |
|
$ |
720,777 |
|
$ |
(307,351 |
) |
$ |
(302,213 |
) |
$ |
(1,189,330 |
) |
$ |
(2,210,002 |
) | ||||
Realized gain (loss) on investments |
|
(135,789 |
) |
488,061 |
|
3,866,119 |
|
6,081,632 |
|
103,088,241 |
|
72,206,087 |
| ||||||||||
Change in net unrealized appreciation (depreciation) on investments |
|
12,186,970 |
|
4,668,982 |
|
9,378,996 |
|
3,867,661 |
|
157,932,039 |
|
165,807,784 |
| ||||||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
12,727,138 |
|
5,877,820 |
|
12,937,764 |
|
9,647,080 |
|
259,830,950 |
|
235,803,869 |
| ||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||
Payments received from contract owners |
|
28,247,918 |
|
28,362,048 |
|
1,069,022 |
|
636,119 |
|
41,164,481 |
|
37,803,535 |
| ||||||||||
Transfers between variable and fixed accounts, net |
|
13,280,135 |
|
7,363,418 |
|
(6,638,941 |
) |
(1,575,141 |
) |
(40,825,883 |
) |
(69,275,906 |
) | ||||||||||
Contract benefits and terminations |
|
(4,003,695 |
) |
(3,247,236 |
) |
(3,475,261 |
) |
(3,572,103 |
) |
(174,721,712 |
) |
(227,800,783 |
) | ||||||||||
Contract charges and deductions |
|
(19,793 |
) |
(9,951 |
) |
(332,843 |
) |
(408,778 |
) |
(13,950,498 |
) |
(14,893,150 |
) | ||||||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
— |
|
— |
|
(1,458 |
) |
— |
|
(9,752 |
) |
279 |
| ||||||||||
Other |
|
(30,356 |
) |
(2,181 |
) |
1,863 |
|
198 |
|
14,221 |
|
64,516 |
| ||||||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
37,474,209 |
|
32,466,098 |
|
(9,377,618 |
) |
(4,919,705 |
) |
(188,329,143 |
) |
(274,101,509 |
) | ||||||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
50,201,347 |
|
38,343,918 |
|
3,560,146 |
|
4,727,375 |
|
71,501,807 |
|
(38,297,640 |
) | ||||||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||
Beginning of Year |
|
60,649,968 |
|
22,306,050 |
|
37,523,740 |
|
32,796,365 |
|
1,537,219,217 |
|
1,575,516,857 |
| ||||||||||
End of Year |
|
$ |
110,851,315 |
|
$ |
60,649,968 |
|
$ |
41,083,886 |
|
$ |
37,523,740 |
|
$ |
1,608,721,024 |
|
$ |
1,537,219,217 |
| ||||
See Notes to Financial Statements
SEPARATE ACCOUNT A
STATEMENTS OF CHANGES IN NET ASSETS (Continued)
|
|
Variable Accounts |
| |||||||||||||||||
|
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
| |||||||
|
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
| ||||||||
|
|
|
2019 |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
| ||||||||
|
|
Fidelity VIP Contrafund |
|
Fidelity VIP FundsManager |
|
Fidelity VIP Government |
| |||||||||||||
|
|
Service Class 2 |
|
60% Service Class 2 |
|
Money Market Service Class |
| |||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
Net investment income (loss) |
|
($2,889,456 |
) |
($2,171,790 |
) |
($1,079,282 |
) |
$ |
336,811 |
|
($4,619,965 |
) |
$ |
|
1,756,680 |
| ||||
Realized gain (loss) on investments |
|
1,931,118 |
|
22,318,195 |
|
1,991,680 |
|
36,890,366 |
|
— |
|
— |
| |||||||
Change in net unrealized appreciation (depreciation) on investments |
|
65,222,288 |
|
34,270,187 |
|
41,925,073 |
|
10,532,834 |
|
— |
|
— |
| |||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
64,263,950 |
|
54,416,592 |
|
42,837,471 |
|
47,760,011 |
|
(4,619,965 |
) |
1,756,680 |
| |||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
Payments received from contract owners |
|
22,578,736 |
|
23,279,325 |
|
39,351,650 |
|
30,350,463 |
|
67,842,926 |
|
44,452,738 |
| |||||||
Transfers between variable and fixed accounts, net |
|
(8,412,024 |
) |
340,584 |
|
7,574,938 |
|
6,494,237 |
|
379,857,532 |
|
197,282,041 |
| |||||||
Contract benefits and terminations |
|
(24,422,683 |
) |
(20,090,358 |
) |
(31,300,338 |
) |
(31,309,392 |
) |
(271,929,174 |
) |
(229,373,559 |
) | |||||||
Contract charges and deductions |
|
(171,499 |
) |
(137,214 |
) |
(2,881,618 |
) |
(2,407,577 |
) |
(572,964 |
) |
(397,678 |
) | |||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
60 |
|
47 |
|
(5,831 |
) |
(10,739 |
) |
(741 |
) |
(1,423 |
) | |||||||
Other |
|
(6,107 |
) |
(2,387 |
) |
(3,500 |
) |
(2,033 |
) |
(9,101 |
) |
1,056 |
| |||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
(10,433,517 |
) |
3,389,997 |
|
12,735,301 |
|
3,114,959 |
|
175,188,478 |
|
11,963,175 |
| |||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
53,830,433 |
|
57,806,589 |
|
55,572,772 |
|
50,874,970 |
|
170,568,513 |
|
13,719,855 |
| |||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
Beginning of Year |
|
239,600,500 |
|
181,793,911 |
|
309,354,003 |
|
258,479,033 |
|
312,107,403 |
|
298,387,548 |
| |||||||
End of Year |
|
$ |
293,430,933 |
|
$ |
239,600,500 |
|
$ |
364,926,775 |
|
$ |
309,354,003 |
|
$ |
482,675,916 |
|
$ |
312,107,403 |
| |
|
|
Fidelity VIP Strategic Income |
|
First Trust Dorsey Wright |
|
First Trust |
| ||||||||||||
|
|
Service Class 2 |
|
Tactical Core Class I |
|
Multi Income Allocation Class I |
| ||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Net investment income (loss) |
|
$ |
1,630,340 |
|
$ |
1,574,135 |
|
($243,946 |
) |
($215,967 |
) |
$ |
160,021 |
|
$ |
184,189 |
| ||
Realized gain (loss) on investments |
|
227,305 |
|
446,653 |
|
(251,553 |
) |
305,735 |
|
148,272 |
|
893 |
| ||||||
Change in net unrealized appreciation (depreciation) on investments |
|
2,676,315 |
|
3,746,995 |
|
3,457,427 |
|
5,623,352 |
|
4,300 |
|
1,821,041 |
| ||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
4,533,960 |
|
5,767,783 |
|
2,961,928 |
|
5,713,120 |
|
312,593 |
|
2,006,123 |
| ||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payments received from contract owners |
|
9,964,028 |
|
15,538,711 |
|
3,643,520 |
|
4,414,657 |
|
2,027,652 |
|
2,547,701 |
| ||||||
Transfers between variable and fixed accounts, net |
|
2,752,238 |
|
6,645,416 |
|
(4,791,689 |
) |
4,166,361 |
|
334,211 |
|
(61,725 |
) | ||||||
Contract benefits and terminations |
|
(9,333,519 |
) |
(6,202,315 |
) |
(2,467,718 |
) |
(4,421,372 |
) |
(1,520,923 |
) |
(1,438,783 |
) | ||||||
Contract charges and deductions |
|
(31,369 |
) |
(27,446 |
) |
(5,651 |
) |
(5,615 |
) |
(1,088 |
) |
(1,144 |
) | ||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
— |
|
— |
|
— |
|
— |
|
6 |
|
7 |
| ||||||
Other |
|
(2,191 |
) |
(697 |
) |
(5,674 |
) |
(428 |
) |
(96 |
) |
240 |
| ||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
3,349,187 |
|
15,953,669 |
|
(3,627,212 |
) |
4,153,603 |
|
839,762 |
|
1,046,296 |
| ||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
7,883,147 |
|
21,721,452 |
|
(665,284 |
) |
9,866,723 |
|
1,152,355 |
|
3,052,419 |
| ||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Beginning of Year |
|
79,193,872 |
|
57,472,420 |
|
37,027,305 |
|
27,160,582 |
|
16,214,326 |
|
13,161,907 |
| ||||||
End of Year |
|
$ |
87,077,019 |
|
$ |
79,193,872 |
|
$ |
36,362,021 |
|
$ |
37,027,305 |
|
$ |
17,366,681 |
|
$ |
16,214,326 |
|
See Notes to Financial Statements
SEPARATE ACCOUNT A
STATEMENTS OF CHANGES IN NET ASSETS (Continued)
|
|
Variable Accounts |
| ||||||||||||||||
|
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
| ||||||
|
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
| |||||||
|
|
|
2019 |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
| |||||||
|
|
First Trust/Dow Jones |
|
Franklin |
|
Franklin |
| ||||||||||||
|
|
Dividend & Income Allocation Class I |
|
Allocation VIP Class 2 |
|
Allocation VIP Class 4 |
| ||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Net investment income (loss) |
|
$ |
1,048,891 |
|
$ |
1,539,310 |
|
$ |
156,607 |
|
$ |
600,714 |
|
($224,382 |
) |
$ |
4,991,944 |
| |
Realized gain (loss) on investments |
|
16,605,305 |
|
22,415,266 |
|
5,547,615 |
|
1,280,541 |
|
58,824,285 |
|
17,441,601 |
| ||||||
Change in net unrealized appreciation (depreciation) on investments |
|
19,615,517 |
|
79,283,953 |
|
(3,168,345 |
) |
1,863,763 |
|
(34,043,298 |
) |
21,000,529 |
| ||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
37,269,713 |
|
103,238,529 |
|
2,535,877 |
|
3,745,018 |
|
24,556,605 |
|
43,434,074 |
| ||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payments received from contract owners |
|
55,021,942 |
|
59,590,652 |
|
1,187,005 |
|
1,130,544 |
|
11,222,112 |
|
9,015,915 |
| ||||||
Transfers between variable and fixed accounts, net |
|
(10,962,518 |
) |
31,448,699 |
|
21,133 |
|
509,103 |
|
(3,952,186 |
) |
(2,978,574 |
) | ||||||
Contract benefits and terminations |
|
(60,069,568 |
) |
(77,645,911 |
) |
(1,502,396 |
) |
(1,282,619 |
) |
(27,321,498 |
) |
(35,325,097 |
) | ||||||
Contract charges and deductions |
|
(5,399,913 |
) |
(4,914,219 |
) |
(100,777 |
) |
(96,812 |
) |
(2,150,831 |
) |
(2,191,961 |
) | ||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
(9,886 |
) |
(1,699 |
) |
— |
|
— |
|
(6,199 |
) |
— |
| ||||||
Other |
|
4,075 |
|
(1,062 |
) |
1,748 |
|
55 |
|
(12,672 |
) |
1,576 |
| ||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
(21,415,868 |
) |
8,476,460 |
|
(393,287 |
) |
260,271 |
|
(22,221,274 |
) |
(31,478,141 |
) | ||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
15,853,845 |
|
111,714,989 |
|
2,142,590 |
|
4,005,289 |
|
2,335,331 |
|
11,955,933 |
| ||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Beginning of Year |
|
647,137,550 |
|
535,422,561 |
|
23,727,646 |
|
19,722,357 |
|
266,689,325 |
|
254,733,392 |
| ||||||
End of Year |
|
$ |
662,991,395 |
|
$ |
647,137,550 |
|
$ |
25,870,236 |
|
$ |
23,727,646 |
|
$ |
269,024,656 |
|
$ |
266,689,325 |
|
|
|
Franklin Income |
|
Franklin Mutual Global |
|
Franklin Rising |
| ||||||||||||||||||
|
|
VIP Class 2 |
|
Discovery VIP Class 2 |
|
Dividends VIP Class 2 |
| ||||||||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||
Net investment income (loss) |
|
$ |
|
2,461,436 |
|
$ |
|
1,972,044 |
|
$ |
|
2,464,993 |
|
$ |
|
1,205,460 |
|
$ |
|
132,044 |
|
$ |
|
55,269 |
|
Realized gain (loss) on investments |
|
(1,359,371 |
) |
564,066 |
|
(8,529,920 |
) |
14,862,315 |
|
8,180,727 |
|
27,123,554 |
| ||||||||||||
Change in net unrealized appreciation (depreciation) on investments |
|
(1,552,418 |
) |
3,627,802 |
|
(3,681,017 |
) |
25,453,640 |
|
17,678,513 |
|
15,855,265 |
| ||||||||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
(450,353 |
) |
6,163,912 |
|
(9,745,944 |
) |
41,521,415 |
|
25,991,284 |
|
43,034,088 |
| ||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||
Payments received from contract owners |
|
2,989,627 |
|
6,181,273 |
|
3,550,616 |
|
4,874,977 |
|
14,613,696 |
|
17,930,491 |
| ||||||||||||
Transfers between variable and fixed accounts, net |
|
1,518,236 |
|
8,765,497 |
|
7,352,377 |
|
(5,508,578 |
) |
(10,848,234 |
) |
6,918,846 |
| ||||||||||||
Contract benefits and terminations |
|
(5,979,843 |
) |
(3,745,927 |
) |
(18,407,389 |
) |
(18,952,146 |
) |
(20,640,364 |
) |
(18,777,721 |
) | ||||||||||||
Contract charges and deductions |
|
(7,588 |
) |
(10,474 |
) |
(996,509 |
) |
(1,196,446 |
) |
(167,360 |
) |
(153,943 |
) | ||||||||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
— |
|
— |
|
(1,349 |
) |
5 |
|
131 |
|
(5,903 |
) | ||||||||||||
Other |
|
(1,635 |
) |
(1,289 |
) |
3,942 |
|
3,080 |
|
612 |
|
(4,432 |
) | ||||||||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
(1,481,203 |
) |
11,189,080 |
|
(8,498,312 |
) |
(20,779,108 |
) |
(17,041,519 |
) |
5,907,338 |
| ||||||||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
(1,931,556 |
) |
17,352,992 |
|
(18,244,256 |
) |
20,742,307 |
|
8,949,765 |
|
48,941,426 |
| ||||||||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||
Beginning of Year |
|
55,900,700 |
|
38,547,708 |
|
206,820,911 |
|
186,078,604 |
|
203,835,964 |
|
154,894,538 |
| ||||||||||||
End of Year |
|
$ |
|
53,969,144 |
|
$ |
|
55,900,700 |
|
$ |
|
188,576,655 |
|
$ |
|
206,820,911 |
|
$ |
|
212,785,729 |
|
$ |
|
203,835,964 |
|
See Notes to Financial Statements
SEPARATE ACCOUNT A
STATEMENTS OF CHANGES IN NET ASSETS (Continued)
|
|
Variable Accounts |
| ||||||||||||||||
|
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
| ||||||
|
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
| |||||||
|
|
|
2019 |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
| |||||||
|
|
Templeton |
|
Ivy VIP |
|
Ivy VIP |
| ||||||||||||
|
|
Global Bond VIP Class 2 |
|
Asset Strategy Class II |
|
Energy Class II |
| ||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Net investment income (loss) |
|
$ |
5,782,771 |
|
$ |
5,566,073 |
|
$ |
93,633 |
|
$ |
120,402 |
|
$ |
127,738 |
|
($216,091 |
) | |
Realized gain (loss) on investments |
|
(2,973,330 |
) |
(929,142 |
) |
174,208 |
|
534,890 |
|
(9,369,757 |
) |
(2,541,349 |
) | ||||||
Change in net unrealized appreciation (depreciation) on investments |
|
(8,503,699 |
) |
(3,897,790 |
) |
1,295,480 |
|
2,027,681 |
|
6,115,432 |
|
3,054,832 |
| ||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
(5,694,258 |
) |
739,141 |
|
1,563,321 |
|
2,682,973 |
|
(3,126,587 |
) |
297,392 |
| ||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payments received from contract owners |
|
2,277,128 |
|
5,175,222 |
|
230,878 |
|
317,586 |
|
2,901,507 |
|
1,432,930 |
| ||||||
Transfers between variable and fixed accounts, net |
|
(514,644 |
) |
2,824,924 |
|
(624,803 |
) |
(64,867 |
) |
4,977,052 |
|
676,059 |
| ||||||
Contract benefits and terminations |
|
(10,265,146 |
) |
(12,030,371 |
) |
(1,701,983 |
) |
(1,611,107 |
) |
(1,452,121 |
) |
(1,485,575 |
) | ||||||
Contract charges and deductions |
|
(103,824 |
) |
(128,410 |
) |
(1,924 |
) |
(2,378 |
) |
(2,903 |
) |
(3,823 |
) | ||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
(1 |
) |
(1,832 |
) |
— |
|
— |
|
— |
|
— |
| ||||||
Other |
|
199 |
|
2,490 |
|
166 |
|
503 |
|
(9,677 |
) |
1,594 |
| ||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
(8,606,288 |
) |
(4,157,977 |
) |
(2,097,666 |
) |
(1,360,263 |
) |
6,413,858 |
|
621,185 |
| ||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
(14,300,546 |
) |
(3,418,836 |
) |
(534,345 |
) |
1,322,710 |
|
3,287,271 |
|
918,577 |
| ||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Beginning of Year |
|
91,721,794 |
|
95,140,630 |
|
15,018,915 |
|
13,696,205 |
|
15,845,384 |
|
14,926,807 |
| ||||||
End of Year |
|
$ |
77,421,248 |
|
$ |
91,721,794 |
|
$ |
14,484,570 |
|
$ |
15,018,915 |
|
$ |
19,132,655 |
|
$ |
15,845,384 |
|
|
|
Janus Henderson |
|
Janus Henderson |
|
JPMorgan Insurance Trust |
| ||||||||||||
|
|
Balanced Service Shares |
|
Flexible Bond Service Shares |
|
Core Bond Class 1 |
| ||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Net investment income (loss) |
|
$ |
10,485,879 |
|
$ |
10,960,976 |
|
$ |
418,047 |
|
$ |
432,331 |
|
$ |
1,209 |
|
$ |
1,999 |
|
Realized gain (loss) on investments |
|
42,978,955 |
|
64,877,318 |
|
(38,797 |
) |
(84,740 |
) |
1,957 |
|
97 |
| ||||||
Change in net unrealized appreciation (depreciation) on investments |
|
410,539,534 |
|
408,544,371 |
|
2,370,783 |
|
1,673,925 |
|
8,439 |
|
9,563 |
| ||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
464,004,368 |
|
484,382,665 |
|
2,750,033 |
|
2,021,516 |
|
11,605 |
|
11,659 |
| ||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payments received from contract owners |
|
717,808,727 |
|
518,501,077 |
|
3,552,558 |
|
2,360,935 |
|
— |
|
— |
| ||||||
Transfers between variable and fixed accounts, net |
|
205,031,418 |
|
261,022,091 |
|
8,769,867 |
|
3,497,326 |
|
— |
|
901 |
| ||||||
Contract benefits and terminations |
|
(289,486,794 |
) |
(228,919,383 |
) |
(5,659,917 |
) |
(3,413,267 |
) |
(22,311 |
) |
(1,984 |
) | ||||||
Contract charges and deductions |
|
(26,140,270 |
) |
(17,865,887 |
) |
(7,730 |
) |
(6,631 |
) |
(97 |
) |
(84 |
) | ||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
253 |
|
(3,243 |
) |
28 |
|
24 |
|
— |
|
— |
| ||||||
Other |
|
(13,192 |
) |
(61,328 |
) |
(2,809 |
) |
(105 |
) |
4 |
|
— |
| ||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
607,200,142 |
|
532,673,327 |
|
6,651,997 |
|
2,438,282 |
|
(22,404 |
) |
(1,167 |
) | ||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
1,071,204,510 |
|
1,017,055,992 |
|
9,402,030 |
|
4,459,798 |
|
(10,799 |
) |
10,492 |
| ||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Beginning of Year |
|
3,171,059,795 |
|
2,154,003,803 |
|
30,110,415 |
|
25,650,617 |
|
185,713 |
|
175,221 |
| ||||||
End of Year |
|
$ |
4,242,264,305 |
|
$ |
3,171,059,795 |
|
$ |
39,512,445 |
|
$ |
30,110,415 |
|
$ |
174,914 |
|
$ |
185,713 |
|
See Notes to Financial Statements
SEPARATE ACCOUNT A |
|||||||
STATEMENTS OF CHANGES IN NET ASSETS (Continued) |
|
|
|
|
|
|
|
Variable Accounts |
| ||||||||||||||||
|
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
| ||||||
|
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
| |||||||
|
|
|
2019 |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
| |||||||
|
|
JPMorgan Insurance Trust |
|
JPMorgan Insurance Trust |
|
JPMorgan Insurance Trust |
| ||||||||||||
|
|
Global Allocation Class 2 |
|
Income Builder Class 2 |
|
Mid Cap Value Class 1 |
| ||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Net investment income (loss) |
|
$ |
65,770 |
|
$ |
108,696 |
|
$ |
267,018 |
|
$ |
198,737 |
|
$ |
8 |
|
$ |
162 |
|
Realized gain (loss) on investments |
|
108,215 |
|
(13,115 |
) |
(116,092 |
) |
22,674 |
|
4,935 |
|
6,494 |
| ||||||
Change in net unrealized appreciation (depreciation) on investments |
|
1,441,078 |
|
1,512,370 |
|
384,350 |
|
1,034,612 |
|
(6,172 |
) |
13,966 |
| ||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
1,615,063 |
|
1,607,951 |
|
535,276 |
|
1,256,023 |
|
(1,229 |
) |
20,622 |
| ||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payments received from contract owners |
|
393,429 |
|
1,339,459 |
|
944,852 |
|
2,118,174 |
|
— |
|
— |
| ||||||
Transfers between variable and fixed accounts, net |
|
(232,080 |
) |
368,031 |
|
785,122 |
|
1,427,299 |
|
— |
|
(901 |
) | ||||||
Contract benefits and terminations |
|
(642,635 |
) |
(1,917,441 |
) |
(685,392 |
) |
(1,223,534 |
) |
(2,535 |
) |
(3,252 |
) | ||||||
Contract charges and deductions |
|
(1,957 |
) |
(2,191 |
) |
(3,169 |
) |
(2,701 |
) |
(34 |
) |
(48 |
) | ||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
| ||||||
Other |
|
(314 |
) |
(35 |
) |
(1,024 |
) |
(542 |
) |
1 |
|
2 |
| ||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
(483,557 |
) |
(212,177 |
) |
1,040,389 |
|
2,318,696 |
|
(2,568 |
) |
(4,199 |
) | ||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
1,131,506 |
|
1,395,774 |
|
1,575,665 |
|
3,574,719 |
|
(3,797 |
) |
16,423 |
| ||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Beginning of Year |
|
11,941,301 |
|
10,545,527 |
|
12,639,900 |
|
9,065,181 |
|
100,340 |
|
83,917 |
| ||||||
End of Year |
|
$ |
13,072,807 |
|
$ |
11,941,301 |
|
$ |
14,215,565 |
|
$ |
12,639,900 |
|
$ |
96,543 |
|
$ |
100,340 |
|
|
|
JPMorgan Insurance Trust |
|
ClearBridge Variable |
|
Lord Abbett |
| ||||||||||||
|
|
U.S. Equity Class 1 |
|
Aggressive Growth - Class II |
|
Bond Debenture Class VC |
| ||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Net investment income (loss) |
|
$ |
(128 |
) |
$ |
(97 |
) |
$ |
(59,875 |
) |
$ |
(27,042 |
) |
$ |
3,430,162 |
|
$ |
3,363,187 |
|
Realized gain (loss) on investments |
|
1,284 |
|
1,262 |
|
1,001,603 |
|
112,142 |
|
(1,461,520 |
) |
(417,554 |
) | ||||||
Change in net unrealized appreciation (depreciation) on investments |
|
3,299 |
|
3,458 |
|
942,502 |
|
1,723,730 |
|
4,804,845 |
|
8,494,694 |
| ||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
4,455 |
|
4,623 |
|
1,884,230 |
|
1,808,830 |
|
6,773,487 |
|
11,440,327 |
| ||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payments received from contract owners |
|
— |
|
— |
|
2,415,837 |
|
1,186,820 |
|
11,796,780 |
|
14,977,465 |
| ||||||
Transfers between variable and fixed accounts, net |
|
— |
|
— |
|
(293,028 |
) |
1,449,678 |
|
2,813,639 |
|
15,527,897 |
| ||||||
Contract benefits and terminations |
|
(728 |
) |
(82 |
) |
(691,473 |
) |
(341,394 |
) |
(10,824,171 |
) |
(12,200,231 |
) | ||||||
Contract charges and deductions |
|
(31 |
) |
(46 |
) |
(4,212 |
) |
(2,698 |
) |
(144,047 |
) |
(119,592 |
) | ||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
— |
|
— |
|
— |
|
— |
|
202 |
|
(1,549 |
) | ||||||
Other |
|
13 |
|
(16 |
) |
1,733 |
|
(421 |
) |
1,582 |
|
(1,208 |
) | ||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
(746 |
) |
(144 |
) |
1,428,857 |
|
2,291,985 |
|
3,643,985 |
|
18,182,782 |
| ||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
3,709 |
|
4,479 |
|
3,313,087 |
|
4,100,815 |
|
10,417,472 |
|
29,623,109 |
| ||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Beginning of Year |
|
19,926 |
|
15,447 |
|
11,023,937 |
|
6,923,122 |
|
121,162,936 |
|
91,539,827 |
| ||||||
End of Year |
|
$ |
23,635 |
|
$ |
19,926 |
|
$ |
14,337,024 |
|
$ |
11,023,937 |
|
$ |
131,580,408 |
|
$ |
121,162,936 |
|
See Notes to Financial Statements
SEPARATE ACCOUNT A
STATEMENTS OF CHANGES IN NET ASSETS (Continued)
|
|
Variable Accounts |
| ||||||||||||||||
|
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
| ||||||
|
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
| |||||||
|
|
|
2019 |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
| |||||||
|
|
Lord Abbett |
|
MFS Massachusetts Investors |
|
MFS Total Return Series - |
| ||||||||||||
|
|
Total Return Class VC |
|
Growth Stock - Service Class |
|
Service Class |
| ||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Net investment income (loss) |
|
$ |
4,440,056 |
|
$ |
5,214,020 |
|
($437,287 |
) |
($347,823 |
) |
$ |
3,474,994 |
|
$ |
3,549,002 |
| ||
Realized gain (loss) on investments |
|
5,379,478 |
|
(691,173 |
) |
9,048,189 |
|
7,290,488 |
|
10,617,889 |
|
10,999,468 |
| ||||||
Change in net unrealized appreciation (depreciation) on investments |
|
7,989,291 |
|
16,493,506 |
|
6,696,798 |
|
17,383,828 |
|
18,396,657 |
|
53,696,427 |
| ||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
17,808,825 |
|
21,016,353 |
|
15,307,700 |
|
24,326,493 |
|
32,489,540 |
|
68,244,897 |
| ||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payments received from contract owners |
|
7,873,410 |
|
7,783,615 |
|
1,857,259 |
|
1,884,682 |
|
27,066,915 |
|
29,258,291 |
| ||||||
Transfers between variable and fixed accounts, net |
|
9,648,148 |
|
6,248,268 |
|
(8,858,885 |
) |
(7,800,925 |
) |
(5,611,692 |
) |
8,154,042 |
| ||||||
Contract benefits and terminations |
|
(25,850,844 |
) |
(24,532,350 |
) |
(6,100,926 |
) |
(5,310,606 |
) |
(39,713,184 |
) |
(46,281,576 |
) | ||||||
Contract charges and deductions |
|
(2,154,140 |
) |
(2,423,402 |
) |
(563,542 |
) |
(603,175 |
) |
(3,468,334 |
) |
(3,317,056 |
) | ||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
(2,251 |
) |
(2,407 |
) |
137 |
|
(3,364 |
) |
(1,179 |
) |
236 |
| ||||||
Other |
|
2,391 |
|
(1,258 |
) |
5,737 |
|
1,678 |
|
(11,946 |
) |
16,999 |
| ||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
(10,483,286 |
) |
(12,927,534 |
) |
(13,660,220 |
) |
(11,831,710 |
) |
(21,739,420 |
) |
(12,169,064 |
) | ||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
7,325,539 |
|
8,088,819 |
|
1,647,480 |
|
12,494,783 |
|
10,750,120 |
|
56,075,833 |
| ||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Beginning of Year |
|
295,798,025 |
|
287,709,206 |
|
79,615,791 |
|
67,121,008 |
|
428,357,165 |
|
372,281,332 |
| ||||||
End of Year |
|
$ |
303,123,564 |
|
$ |
295,798,025 |
|
$ |
81,263,271 |
|
$ |
79,615,791 |
|
$ |
439,107,285 |
|
$ |
428,357,165 |
|
|
|
MFS Utilities Series - |
|
MFS Value Series - |
|
Neuberger Berman U.S. Equity Index |
| ||||||||||||
|
|
Service Class |
|
Service Class |
|
PutWrite Strategy Class S |
| ||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Net investment income (loss) |
|
$ |
469,775 |
|
$ |
1,375,254 |
|
$ |
414,453 |
|
$ |
856,556 |
|
($4,433 |
) |
($13,050 |
) | ||
Realized gain (loss) on investments |
|
638,490 |
|
189,021 |
|
3,469,788 |
|
3,837,114 |
|
74,975 |
|
(8,081 |
) | ||||||
Change in net unrealized appreciation (depreciation) on investments |
|
(60,970 |
) |
9,208,697 |
|
(1,311,516 |
) |
15,182,923 |
|
25,523 |
|
165,711 |
| ||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
1,047,295 |
|
10,772,972 |
|
2,572,725 |
|
19,876,593 |
|
96,065 |
|
144,580 |
| ||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payments received from contract owners |
|
4,091,425 |
|
4,907,829 |
|
1,741,297 |
|
2,366,572 |
|
333,111 |
|
214,276 |
| ||||||
Transfers between variable and fixed accounts, net |
|
(4,499,791 |
) |
5,882,426 |
|
2,118,358 |
|
(3,122,388 |
) |
(73,657 |
) |
219,062 |
| ||||||
Contract benefits and terminations |
|
(6,018,262 |
) |
(7,251,685 |
) |
(6,503,892 |
) |
(6,402,679 |
) |
(158,670 |
) |
(64,375 |
) | ||||||
Contract charges and deductions |
|
(27,235 |
) |
(25,732 |
) |
(553,678 |
) |
(632,936 |
) |
(134 |
) |
(120 |
) | ||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
— |
|
— |
|
(1,433 |
) |
— |
|
— |
|
— |
| ||||||
Other |
|
(1,393 |
) |
539 |
|
2,695 |
|
1,080 |
|
4 |
|
(15 |
) | ||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
(6,455,256 |
) |
3,513,377 |
|
(3,196,653 |
) |
(7,790,351 |
) |
100,654 |
|
368,828 |
| ||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
(5,407,961 |
) |
14,286,349 |
|
(623,928 |
) |
12,086,242 |
|
196,719 |
|
513,408 |
| ||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Beginning of Year |
|
59,832,797 |
|
45,546,448 |
|
84,221,535 |
|
72,135,293 |
|
1,452,167 |
|
938,759 |
| ||||||
End of Year |
|
$ |
54,424,836 |
|
$ |
59,832,797 |
|
$ |
83,597,607 |
|
$ |
84,221,535 |
|
$ |
1,648,886 |
|
$ |
1,452,167 |
|
See Notes to Financial Statements
SEPARATE ACCOUNT A
STATEMENTS OF CHANGES IN NET ASSETS (Continued)
|
|
Variable Accounts |
| ||||||||||||||
|
|
Year/Period Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year/Period Ended |
|
Year Ended |
| ||||
|
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
| |||||
|
|
|
2019 |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
| |||||
|
|
PIMCO All Asset - |
|
PIMCO CommodityRealReturn |
|
PIMCO Income - |
| ||||||||||
|
|
Advisor Class (1) |
|
Strategy - Advisor Class |
|
Advisor Class (1) |
| ||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Net investment income (loss) |
|
$ |
37,079 |
|
|
|
$ |
339,839 |
|
$ |
221,009 |
|
$ |
39,365 |
|
|
|
Realized gain (loss) on investments |
|
6,960 |
|
|
|
(373,330 |
) |
(295,444 |
) |
(7,424 |
) |
|
| ||||
Change in net unrealized appreciation (depreciation) on investments |
|
289,435 |
|
|
|
179,015 |
|
745,601 |
|
178,846 |
|
|
| ||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
333,474 |
|
|
|
145,524 |
|
671,166 |
|
210,787 |
|
|
| ||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Payments received from contract owners |
|
98,576 |
|
|
|
728,790 |
|
901,357 |
|
1,716,788 |
|
|
| ||||
Transfers between variable and fixed accounts, net |
|
2,324,990 |
|
|
|
587,067 |
|
28,874 |
|
3,959,949 |
|
|
| ||||
Contract benefits and terminations |
|
(282,358 |
) |
|
|
(432,672 |
) |
(770,129 |
) |
(639,902 |
) |
|
| ||||
Contract charges and deductions |
|
(136 |
) |
|
|
(1,636 |
) |
(2,756 |
) |
(9,216 |
) |
|
| ||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
— |
|
|
|
— |
|
— |
|
— |
|
|
| ||||
Other |
|
(90 |
) |
|
|
(198 |
) |
(34 |
) |
(306 |
) |
|
| ||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
2,140,982 |
|
|
|
881,351 |
|
157,312 |
|
5,027,313 |
|
|
| ||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
2,474,456 |
|
|
|
1,026,875 |
|
828,478 |
|
5,238,100 |
|
|
| ||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Beginning of Year or Period |
|
— |
|
|
|
7,605,029 |
|
6,776,551 |
|
— |
|
|
| ||||
End of Year or Period |
|
$ |
2,474,456 |
|
|
|
8,631,904 |
|
$ |
7,605,029 |
|
$ |
5,238,100 |
|
|
| |
|
|
|
|
|
|
|
|
SP Prudential |
| ||||||||||
|
|
Jennison Class II |
|
SP International Growth Class II |
|
U.S. Emerging Growth Class II |
| ||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Net investment income (loss) |
|
($1,399 |
) |
($1,057 |
) |
($875 |
) |
($802 |
) |
($482 |
) |
($1,728 |
) | ||||||
Realized gain (loss) on investments |
|
1,716 |
|
955 |
|
2,433 |
|
2,417 |
|
46,488 |
|
24,091 |
| ||||||
Change in net unrealized appreciation (depreciation) on investments |
|
42,256 |
|
19,023 |
|
13,657 |
|
11,284 |
|
(34,217 |
) |
5,283 |
| ||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
42,573 |
|
18,921 |
|
15,215 |
|
12,899 |
|
11,789 |
|
27,646 |
| ||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payments received from contract owners |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
| ||||||
Transfers between variable and fixed accounts, net |
|
— |
|
— |
|
— |
|
— |
|
(67,139 |
) |
(36,685 |
) | ||||||
Contract benefits and terminations |
|
(504 |
) |
(73 |
) |
(2,989 |
) |
(3,640 |
) |
(319 |
) |
(50 |
) | ||||||
Contract charges and deductions |
|
(65 |
) |
(44 |
) |
(114 |
) |
(90 |
) |
(21 |
) |
(237 |
) | ||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
| ||||||
Other |
|
(14 |
) |
9 |
|
(10 |
) |
(8 |
) |
(61 |
) |
(1 |
) | ||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
(583 |
) |
(108 |
) |
(3,113 |
) |
(3,738 |
) |
(67,540 |
) |
(36,973 |
) | ||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
41,990 |
|
18,813 |
|
12,102 |
|
9,161 |
|
(55,751 |
) |
(9,327 |
) | ||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Beginning of Year |
|
80,093 |
|
61,280 |
|
53,491 |
|
44,330 |
|
81,961 |
|
91,288 |
| ||||||
End of Year |
|
$ |
122,083 |
|
$ |
80,093 |
|
$ |
65,593 |
|
$ |
53,491 |
|
$ |
26,210 |
|
$ |
81,961 |
|
(1) Operations commenced or resumed during 2020 (See Financial Highlights for commencement date of operations).
See Notes to Financial Statements
SEPARATE ACCOUNT A
STATEMENTS OF CHANGES IN NET ASSETS (Continued)
|
|
Variable Accounts |
| ||||||||||||||||||||||
|
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
|
Year Ended |
| ||||||||||||
|
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
| |||||||||||||
|
|
|
2019 |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
| |||||||||||||
|
|
|
|
|
|
|
|
|
|
Schwab VIT |
| ||||||||||||||
|
|
Value Class II |
|
Schwab VIT Balanced |
|
Balanced with Growth |
| ||||||||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||
Net investment income (loss) |
|
$ |
(1,161 |
) |
$ |
(1,718 |
) |
$ |
|
835,236 |
|
$ |
|
724,178 |
|
$ |
|
1,924,721 |
|
$ |
|
1,695,977 |
| ||
Realized gain (loss) on investments |
|
2,239 |
|
26,285 |
|
105,391 |
|
236,286 |
|
961,482 |
|
865,038 |
| ||||||||||||
Change in net unrealized appreciation (depreciation) on investments |
|
120 |
|
(2,604 |
) |
4,345,972 |
|
7,040,030 |
|
9,401,695 |
|
19,147,259 |
| ||||||||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
1,198 |
|
21,963 |
|
5,286,599 |
|
8,000,494 |
|
12,287,898 |
|
21,708,274 |
| ||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||
Payments received from contract owners |
|
— |
|
— |
|
4,669,014 |
|
6,417,995 |
|
1,401,689 |
|
7,784,254 |
| ||||||||||||
Transfers between variable and fixed accounts, net |
|
— |
|
(40,443 |
) |
2,712,614 |
|
657,530 |
|
(1,764,560 |
) |
1,056,708 |
| ||||||||||||
Contract benefits and terminations |
|
(2,336 |
) |
(2,335 |
) |
(5,109,473 |
) |
(8,774,554 |
) |
(9,700,960 |
) |
(10,740,927 |
) | ||||||||||||
Contract charges and deductions |
|
(261 |
) |
(253 |
) |
(275,785 |
) |
(274,675 |
) |
(658,693 |
) |
(688,628 |
) | ||||||||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
| ||||||||||||
Other |
|
(4 |
) |
(20 |
) |
112 |
|
238 |
|
252 |
|
(5,448 |
) | ||||||||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
(2,601 |
) |
(43,051 |
) |
1,996,482 |
|
(1,973,466 |
) |
(10,722,272 |
) |
(2,594,041 |
) | ||||||||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
(1,403 |
) |
(21,088 |
) |
7,283,081 |
|
6,027,028 |
|
1,565,626 |
|
19,114,233 |
| ||||||||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||
Beginning of Year |
|
86,339 |
|
107,427 |
|
64,871,472 |
|
58,844,444 |
|
145,983,472 |
|
126,869,239 |
| ||||||||||||
End of Year |
|
$ |
|
84,936 |
|
$ |
|
86,339 |
|
$ |
|
72,154,553 |
|
$ |
|
64,871,472 |
|
$ |
|
147,549,098 |
|
$ |
|
145,983,472 |
|
|
|
|
|
State Street |
|
VanEck VIP |
| ||||||||||||
|
|
Schwab VIT Growth |
|
Total Return V.I.S. Class 3 |
|
Global Hard Assets Class S |
| ||||||||||||
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Net investment income (loss) |
|
$ |
1,997,313 |
|
$ |
1,676,540 |
|
$ |
1,301,386 |
|
$ |
3,035,940 |
|
($59,844 |
) |
($169,891 |
) | ||
Realized gain (loss) on investments |
|
2,633,013 |
|
1,125,464 |
|
(6,071,893 |
) |
(9,383,865 |
) |
(1,520,068 |
) |
(482,607 |
) | ||||||
Change in net unrealized appreciation (depreciation) on investments |
|
10,084,528 |
|
23,408,912 |
|
20,823,268 |
|
60,704,877 |
|
4,407,476 |
|
1,989,300 |
| ||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
|
14,714,854 |
|
26,210,916 |
|
16,052,761 |
|
54,356,952 |
|
2,827,564 |
|
1,336,802 |
| ||||||
INCREASE (DECREASE) IN NET ASSETS FROM CONTRACT OWNER TRANSACTIONS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Payments received from contract owners |
|
2,238,007 |
|
5,249,546 |
|
12,257,908 |
|
12,291,810 |
|
1,246,343 |
|
1,241,010 |
| ||||||
Transfers between variable and fixed accounts, net |
|
(948,054 |
) |
(1,714,238 |
) |
(6,522,414 |
) |
(2,003,078 |
) |
631,800 |
|
2,067,968 |
| ||||||
Contract benefits and terminations |
|
(10,750,363 |
) |
(9,044,519 |
) |
(40,877,040 |
) |
(58,715,822 |
) |
(1,445,977 |
) |
(1,707,789 |
) | ||||||
Contract charges and deductions |
|
(916,317 |
) |
(953,956 |
) |
(3,741,014 |
) |
(4,055,055 |
) |
(5,624 |
) |
(6,074 |
) | ||||||
Adjustments to net assets allocated to contracts in payout (annuitization) period |
|
— |
|
— |
|
(7,250 |
) |
— |
|
— |
|
(467 |
) | ||||||
Other |
|
1,641 |
|
(1,284 |
) |
(4,136 |
) |
(3,209 |
) |
(10,279 |
) |
464 |
| ||||||
Net Increase (Decrease) in Net Assets Derived from Contract Owner Transactions |
|
(10,375,086 |
) |
(6,464,451 |
) |
(38,893,946 |
) |
(52,485,354 |
) |
416,263 |
|
1,595,112 |
| ||||||
NET INCREASE (DECREASE) IN NET ASSETS |
|
4,339,768 |
|
19,746,465 |
|
(22,841,185 |
) |
1,871,598 |
|
3,243,827 |
|
2,931,914 |
| ||||||
NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Beginning of Year |
|
152,169,454 |
|
132,422,989 |
|
406,020,577 |
|
404,148,979 |
|
14,683,220 |
|
11,751,306 |
| ||||||
End of Year |
|
$ |
156,509,222 |
|
$ |
152,169,454 |
|
$ |
383,179,392 |
|
$ |
406,020,577 |
|
$ |
17,927,047 |
|
$ |
14,683,220 |
|
See Notes to Financial Statements
SEPARATE ACCOUNT A
FINANCIAL HIGHLIGHTS
A summary of accumulation unit values (“AUV”), units outstanding, net assets, investment income ratios, expense ratios, and total returns for each year or period ended December 31 are presented in the table below.
|
|
At the End of Each Year |
|
Investment |
|
|
|
|
|
|
|
|
| |||||||||
Variable Accounts |
|
AUV (1) |
|
Units |
|
Net |
|
Income |
|
Expense Ratios (3) |
|
Total Returns (4) |
| |||||||||
For Each Year |
|
Lowest |
|
Highest |
|
Outstanding |
|
Assets |
|
Ratios (2) |
|
Lowest |
|
Highest |
|
Lowest |
|
Highest |
| |||
Core Income Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
11.46 |
|
$ |
12.51 |
|
3,189,553 |
|
$ |
38,329,877 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
7.46 |
% |
9.25 |
% |
2019 |
|
10.64 |
|
11.46 |
|
2,151,095 |
|
23,795,771 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
8.73 |
% |
10.59 |
% | |||
2018 |
|
9.78 |
|
10.38 |
|
1,148,625 |
|
11,581,723 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(3.89 |
)% |
(2.24 |
)% | |||
2017 |
|
10.18 |
|
10.62 |
|
909,570 |
|
9,460,743 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
2.93 |
% |
4.69 |
% | |||
2016 |
|
9.89 |
|
10.16 |
|
537,638 |
|
5,386,512 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
3.37 |
% |
4.82 |
% | |||
Diversified Bond Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
12.14 |
|
$ |
19.49 |
|
15,489,503 |
|
$ |
225,524,712 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
8.17 |
% |
10.02 |
% |
2019 |
|
11.16 |
|
17.73 |
|
13,472,666 |
|
182,275,698 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
10.76 |
% |
12.66 |
% | |||
2018 |
|
10.03 |
|
15.75 |
|
11,784,263 |
|
145,114,938 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(3.32 |
)% |
(1.65 |
)% | |||
2017 |
|
10.74 |
|
16.03 |
|
11,361,172 |
|
146,494,032 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
4.77 |
% |
6.45 |
% | |||
2016 |
|
10.38 |
|
15.06 |
|
10,600,495 |
|
131,681,727 |
|
0.00 |
% |
0.40 |
% |
2.00 |
% |
2.97 |
% |
4.62 |
% | |||
Floating Rate Income Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
10.97 |
|
$ |
12.78 |
|
11,256,440 |
|
$ |
133,786,363 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
2.63 |
% |
4.39 |
% |
2019 |
|
10.64 |
|
12.25 |
|
14,377,073 |
|
165,220,344 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
5.97 |
% |
7.78 |
% | |||
2018 |
|
10.02 |
|
11.38 |
|
6,020,102 |
|
64,891,680 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(2.02 |
)% |
(0.33 |
)% | |||
2017 |
|
10.16 |
|
11.43 |
|
4,156,679 |
|
45,409,928 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
1.71 |
% |
3.45 |
% | |||
2016 |
|
10.14 |
|
11.06 |
|
3,946,049 |
|
42,106,982 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
6.24 |
% |
7.95 |
% | |||
High Yield Bond Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
11.64 |
|
$ |
29.64 |
|
9,125,009 |
|
$ |
169,940,567 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
3.65 |
% |
5.43 |
% |
2019 |
|
11.15 |
|
28.14 |
|
9,943,416 |
|
180,716,346 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
11.73 |
% |
13.64 |
% | |||
2018 |
|
9.91 |
|
24.79 |
|
9,511,531 |
|
156,838,974 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(5.20 |
)% |
(3.56 |
)% | |||
2017 |
|
10.38 |
|
25.73 |
|
10,424,807 |
|
185,037,902 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
5.62 |
% |
7.32 |
% | |||
2016 |
|
10.59 |
|
24.06 |
|
11,179,748 |
|
193,712,176 |
|
0.00 |
% |
0.40 |
% |
2.00 |
% |
13.09 |
% |
14.91 |
% | |||
Inflation Managed Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
10.12 |
|
$ |
26.35 |
|
10,364,592 |
|
$ |
181,604,575 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
9.21 |
% |
11.09 |
% |
2019 |
|
9.24 |
|
23.99 |
|
10,343,826 |
|
169,617,916 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
6.49 |
% |
8.32 |
% | |||
2018 |
|
8.66 |
|
22.39 |
|
11,247,518 |
|
176,500,238 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(4.10 |
)% |
(2.45 |
)% | |||
2017 |
|
9.02 |
|
23.21 |
|
12,265,881 |
|
204,083,093 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
1.63 |
% |
3.37 |
% | |||
2016 |
|
8.85 |
|
22.70 |
|
12,952,814 |
|
216,884,736 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
3.04 |
% |
4.70 |
% | |||
Managed Bond Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
11.07 |
|
$ |
28.90 |
|
22,834,095 |
|
$ |
403,577,841 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
6.20 |
% |
8.02 |
% |
2019 |
|
10.40 |
|
27.05 |
|
22,284,620 |
|
381,005,513 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
6.34 |
% |
8.17 |
% | |||
2018 |
|
9.76 |
|
25.29 |
|
21,835,220 |
|
364,851,787 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(2.58 |
)% |
(0.90 |
)% | |||
2017 |
|
10.00 |
|
25.80 |
|
22,936,556 |
|
402,527,859 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
2.65 |
% |
4.30 |
% | |||
2016 |
|
9.72 |
|
24.98 |
|
23,644,535 |
|
416,030,223 |
|
0.00 |
% |
0.40 |
% |
2.00 |
% |
0.84 |
% |
2.46 |
% | |||
Short Duration Bond Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
9.90 |
|
$ |
13.35 |
|
33,138,939 |
|
$ |
359,491,780 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
1.68 |
% |
3.42 |
% |
2019 |
|
9.72 |
|
12.92 |
|
32,261,598 |
|
341,983,698 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
2.16 |
% |
3.91 |
% | |||
2018 |
|
9.49 |
|
12.44 |
|
30,236,850 |
|
311,504,706 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(0.88 |
)% |
0.83 |
% | |||
2017 |
|
9.56 |
|
12.35 |
|
30,998,708 |
|
319,786,586 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(0.74 |
)% |
0.95 |
% | |||
2016 |
|
9.61 |
|
12.25 |
|
29,768,754 |
|
307,361,924 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(0.32 |
)% |
1.28 |
% | |||
Emerging Markets Debt Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
10.36 |
|
$ |
12.81 |
|
1,580,511 |
|
$ |
18,134,828 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(0.26 |
)% |
1.45 |
% |
2019 |
|
10.36 |
|
12.64 |
|
1,777,321 |
|
20,249,407 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
7.35 |
% |
9.19 |
% | |||
2018 |
|
9.63 |
|
11.59 |
|
1,797,712 |
|
18,951,916 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(7.34 |
)% |
(5.74 |
)% | |||
2017 |
|
10.37 |
|
12.31 |
|
2,013,734 |
|
22,825,282 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
10.86 |
% |
12.64 |
% | |||
2016 |
|
9.34 |
|
10.93 |
|
1,407,822 |
|
14,351,136 |
|
0.00 |
% |
0.40 |
% |
2.00 |
% |
14.71 |
% |
16.55 |
% | |||
Dividend Growth Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
15.73 |
|
$ |
36.88 |
|
14,379,140 |
|
$ |
392,591,032 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
11.19 |
% |
13.10 |
% |
2019 |
|
14.07 |
|
32.64 |
|
14,570,294 |
|
360,631,080 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
28.05 |
% |
30.25 |
% | |||
2018 |
|
10.94 |
|
25.09 |
|
14,056,494 |
|
274,423,228 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(3.25 |
)% |
(1.58 |
)% | |||
2017 |
|
11.26 |
|
25.52 |
|
14,677,356 |
|
298,908,323 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
16.72 |
% |
18.60 |
% | |||
2016 |
|
13.95 |
|
21.52 |
|
15,083,139 |
|
265,325,367 |
|
0.00 |
% |
0.40 |
% |
2.00 |
% |
9.26 |
% |
11.02 |
% | |||
Equity Index Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
16.13 |
|
$ |
63.79 |
|
42,907,290 |
|
$ |
1,207,544,897 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
15.77 |
% |
17.76 |
% |
2019 |
|
13.84 |
|
54.77 |
|
42,320,089 |
|
1,044,372,214 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
28.50 |
% |
30.70 |
% | |||
2018 |
|
10.69 |
|
42.36 |
|
39,266,074 |
|
770,008,055 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(6.63 |
)% |
(5.02 |
)% | |||
2017 |
|
11.37 |
|
45.10 |
|
35,402,014 |
|
774,542,663 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
19.08 |
% |
21.12 |
% | |||
2016 |
|
10.23 |
|
37.65 |
|
29,000,838 |
|
566,929,068 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
9.41 |
% |
11.17 |
% |
See Notes to Financial Statements |
See explanation of references on pages SA-46 and SA-47 |
SEPARATE ACCOUNT A
FINANCIAL HIGHLIGHTS (Continued)
|
|
At the End of Each Year |
|
Investment |
|
|
|
|
|
|
|
|
| |||||||||
Variable Accounts |
|
AUV (1) |
|
Units |
|
Net |
|
Income |
|
Expense Ratios (3) |
|
Total Returns (4) |
| |||||||||
For Each Year |
|
Lowest |
|
Highest |
|
Outstanding |
|
Assets |
|
Ratios (2) |
|
Lowest |
|
Highest |
|
Lowest |
|
Highest |
| |||
Focused Growth Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
22.24 |
|
$ |
87.16 |
|
5,161,793 |
|
$ |
219,367,794 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
35.56 |
% |
37.88 |
% |
2019 |
|
16.29 |
|
63.28 |
|
5,518,935 |
|
176,509,190 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
32.78 |
% |
35.06 |
% | |||
2018 |
|
13.73 |
|
46.90 |
|
5,377,847 |
|
132,603,632 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
2.90 |
% |
4.67 |
% | |||
2017 |
|
13.14 |
|
44.85 |
|
5,314,062 |
|
129,578,140 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
26.94 |
% |
28.98 |
% | |||
2016 |
|
12.92 |
|
34.77 |
|
5,171,075 |
|
100,426,734 |
|
0.00 |
% |
0.40 |
% |
2.00 |
% |
0.32 |
% |
1.94 |
% | |||
Growth Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
21.12 |
|
$ |
90.01 |
|
7,677,598 |
|
$ |
386,224,796 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
28.96 |
% |
31.17 |
% |
2019 |
|
16.30 |
|
69.38 |
|
7,725,298 |
|
313,122,387 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
35.40 |
% |
37.72 |
% | |||
2018 |
|
11.98 |
|
50.93 |
|
7,589,376 |
|
238,326,340 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
0.36 |
% |
2.09 |
% | |||
2017 |
|
11.87 |
|
50.44 |
|
7,279,286 |
|
241,794,590 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
29.05 |
% |
31.12 |
% | |||
2016 |
|
14.03 |
|
38.86 |
|
6,975,730 |
|
192,689,145 |
|
0.00 |
% |
0.40 |
% |
2.00 |
% |
0.19 |
% |
1.81 |
% | |||
Large-Cap Growth Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
21.42 |
|
$ |
49.94 |
|
9,264,727 |
|
$ |
292,565,788 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
35.61 |
% |
37.93 |
% |
2019 |
|
15.72 |
|
36.37 |
|
9,225,050 |
|
213,262,358 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
29.72 |
% |
31.95 |
% | |||
2018 |
|
12.05 |
|
27.69 |
|
9,251,139 |
|
163,354,575 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(0.14 |
)% |
1.58 |
% | |||
2017 |
|
13.53 |
|
27.38 |
|
8,806,973 |
|
154,330,909 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
31.05 |
% |
33.16 |
% | |||
2016 |
|
10.90 |
|
20.63 |
|
8,541,364 |
|
112,315,118 |
|
0.00 |
% |
0.40 |
% |
2.00 |
% |
(1.48 |
)% |
0.11 |
% | |||
Large-Cap Value Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
12.91 |
|
$ |
31.65 |
|
8,251,342 |
|
$ |
200,560,402 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
3.77 |
% |
5.55 |
% |
2019 |
|
12.35 |
|
30.31 |
|
8,646,430 |
|
205,659,391 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
25.92 |
% |
28.08 |
% | |||
2018 |
|
9.74 |
|
23.93 |
|
9,256,573 |
|
176,677,899 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(11.15 |
)% |
(9.62 |
)% | |||
2017 |
|
10.89 |
|
26.77 |
|
9,827,960 |
|
214,499,954 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
11.70 |
% |
13.61 |
% | |||
2016 |
|
10.14 |
|
23.82 |
|
10,454,979 |
|
207,532,086 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
10.64 |
% |
12.42 |
% | |||
Main Street Core Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
16.30 |
|
$ |
48.17 |
|
8,154,980 |
|
$ |
283,532,001 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
11.68 |
% |
13.59 |
% |
2019 |
|
14.38 |
|
42.88 |
|
9,529,328 |
|
293,457,670 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
29.52 |
% |
31.74 |
% | |||
2018 |
|
10.93 |
|
32.91 |
|
10,633,140 |
|
253,542,764 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(9.58 |
)% |
(8.02 |
)% | |||
2017 |
|
11.94 |
|
36.17 |
|
10,697,448 |
|
288,946,584 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
14.77 |
% |
16.62 |
% | |||
2016 |
|
14.52 |
|
31.33 |
|
11,790,047 |
|
280,082,160 |
|
0.00 |
% |
0.40 |
% |
2.00 |
% |
9.62 |
% |
11.38 |
% | |||
Mid-Cap Equity Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
15.60 |
|
$ |
58.40 |
|
6,443,675 |
|
$ |
234,858,057 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
24.99 |
% |
27.13 |
% |
2019 |
|
12.42 |
|
46.45 |
|
6,996,655 |
|
209,138,478 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
18.45 |
% |
20.48 |
% | |||
2018 |
|
10.43 |
|
38.98 |
|
7,287,312 |
|
188,424,421 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(11.51 |
)% |
(9.99 |
)% | |||
2017 |
|
12.64 |
|
43.78 |
|
7,230,346 |
|
221,541,017 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
21.82 |
% |
23.78 |
% | |||
2016 |
|
14.46 |
|
35.73 |
|
7,115,623 |
|
191,476,971 |
|
0.00 |
% |
0.40 |
% |
2.00 |
% |
16.09 |
% |
17.95 |
% | |||
Mid-Cap Growth Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
23.82 |
|
$ |
46.10 |
|
9,767,687 |
|
$ |
341,825,807 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
47.17 |
% |
49.69 |
% |
2019 |
|
16.07 |
|
30.93 |
|
10,774,027 |
|
258,256,271 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
35.71 |
% |
38.04 |
% | |||
2018 |
|
11.76 |
|
22.54 |
|
11,170,460 |
|
198,481,470 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(1.83 |
)% |
(0.14 |
)% | |||
2017 |
|
11.89 |
|
22.91 |
|
11,487,278 |
|
208,391,053 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
24.98 |
% |
26.98 |
% | |||
2016 |
|
11.49 |
|
18.28 |
|
11,905,807 |
|
173,111,392 |
|
0.00 |
% |
0.40 |
% |
2.00 |
% |
4.17 |
% |
5.85 |
% | |||
Mid-Cap Value Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
13.39 |
|
$ |
36.52 |
|
3,812,231 |
|
$ |
85,401,943 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
3.43 |
% |
5.20 |
% |
2019 |
|
12.76 |
|
34.75 |
|
4,350,388 |
|
97,366,796 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
27.37 |
% |
29.55 |
% | |||
2018 |
|
9.87 |
|
26.85 |
|
4,398,530 |
|
76,990,322 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(16.49 |
)% |
(15.05 |
)% | |||
2017 |
|
11.64 |
|
31.64 |
|
4,455,306 |
|
95,753,067 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
13.18 |
% |
15.12 |
% | |||
2016 |
|
10.13 |
|
27.51 |
|
4,289,298 |
|
84,417,787 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
13.01 |
% |
14.83 |
% | |||
Small-Cap Equity Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
12.53 |
|
$ |
36.14 |
|
2,628,838 |
|
$ |
54,784,251 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
3.33 |
% |
5.10 |
% |
2019 |
|
11.94 |
|
34.42 |
|
2,666,253 |
|
54,430,618 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
21.50 |
% |
23.59 |
% | |||
2018 |
|
9.68 |
|
27.88 |
|
2,597,583 |
|
44,747,889 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(14.65 |
)% |
(13.17 |
)% | |||
2017 |
|
11.17 |
|
32.14 |
|
2,458,757 |
|
51,461,956 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
6.57 |
% |
8.29 |
% | |||
2016 |
|
14.44 |
|
29.68 |
|
2,588,225 |
|
52,954,215 |
|
0.00 |
% |
0.40 |
% |
2.00 |
% |
27.85 |
% |
29.90 |
% | |||
Small-Cap Growth Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
24.95 |
|
$ |
45.17 |
|
4,452,222 |
|
$ |
155,145,306 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
52.50 |
% |
55.11 |
% |
2019 |
|
16.25 |
|
29.15 |
|
5,053,589 |
|
116,165,093 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
29.29 |
% |
31.51 |
% | |||
2018 |
|
13.62 |
|
22.19 |
|
5,514,620 |
|
98,638,713 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
3.45 |
% |
5.23 |
% | |||
2017 |
|
12.99 |
|
21.11 |
|
5,581,503 |
|
96,784,780 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
27.65 |
% |
29.70 |
% | |||
2016 |
|
10.44 |
|
16.35 |
|
6,224,494 |
|
84,377,998 |
|
0.00 |
% |
0.40 |
% |
2.00 |
% |
(4.39 |
)% |
(2.85 |
)% |
See Notes to Financial Statements |
See explanation of references on pages SA-46 and SA-47 |
SEPARATE ACCOUNT A
FINANCIAL HIGHLIGHTS (Continued)
|
|
At the End of Each Year |
|
Investment |
|
|
|
|
|
|
|
|
| |||||||||
Variable Accounts |
|
AUV (1) |
|
Units |
|
Net |
|
Income |
|
Expense Ratios (3) |
|
Total Returns (4) |
| |||||||||
For Each Year |
|
Lowest |
|
Highest |
|
Outstanding |
|
Assets |
|
Ratios (2) |
|
Lowest |
|
Highest |
|
Lowest |
|
Highest |
| |||
Small-Cap Index Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
14.02 |
|
$ |
43.41 |
|
10,160,705 |
|
$ |
265,843,742 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
16.80 |
% |
18.80 |
% |
2019 |
|
11.94 |
|
36.58 |
|
10,182,090 |
|
233,189,346 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
22.33 |
% |
24.42 |
% | |||
2018 |
|
9.71 |
|
29.43 |
|
9,742,504 |
|
187,508,926 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(13.32 |
)% |
(11.82 |
)% | |||
2017 |
|
11.15 |
|
33.40 |
|
9,016,533 |
|
211,161,458 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
11.81 |
% |
13.72 |
% | |||
2016 |
|
10.34 |
|
29.40 |
|
8,065,207 |
|
181,325,886 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
18.28 |
% |
20.18 |
% | |||
Small-Cap Value Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
11.08 |
|
$ |
53.74 |
|
4,325,214 |
|
$ |
108,118,275 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
1.39 |
% |
3.13 |
% |
2019 |
|
10.87 |
|
52.16 |
|
4,552,357 |
|
114,480,115 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
20.16 |
% |
22.22 |
% | |||
2018 |
|
9.00 |
|
42.72 |
|
4,539,485 |
|
98,856,096 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(17.96 |
)% |
(16.54 |
)% | |||
2017 |
|
11.09 |
|
51.24 |
|
4,675,161 |
|
129,260,288 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
6.51 |
% |
8.33 |
% | |||
2016 |
|
10.26 |
|
47.35 |
|
4,792,527 |
|
131,490,936 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
27.04 |
% |
29.08 |
% | |||
Value Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
11.16 |
|
$ |
25.66 |
|
8,856,167 |
|
$ |
176,480,230 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(8.78 |
)% |
(7.22 |
)% |
2019 |
|
12.17 |
|
27.69 |
|
9,134,455 |
|
197,827,146 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
22.25 |
% |
24.35 |
% | |||
2018 |
|
9.91 |
|
22.29 |
|
9,819,439 |
|
172,698,671 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(14.12 |
)% |
(12.63 |
)% | |||
2017 |
|
11.89 |
|
25.54 |
|
10,246,575 |
|
209,743,589 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
15.44 |
% |
17.29 |
% | |||
2016 |
|
13.56 |
|
21.77 |
|
11,122,907 |
|
196,799,642 |
|
0.00 |
% |
0.40 |
% |
2.00 |
% |
15.18 |
% |
17.03 |
% | |||
Value Advantage Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
12.84 |
|
$ |
18.42 |
|
2,729,163 |
|
$ |
46,722,273 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(4.70 |
)% |
(3.07 |
)% |
2019 |
|
13.28 |
|
19.02 |
|
2,407,374 |
|
42,826,045 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
24.45 |
% |
26.58 |
% | |||
2018 |
|
10.51 |
|
15.04 |
|
2,092,943 |
|
29,758,832 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(10.88 |
)% |
(9.34 |
)% | |||
2017 |
|
11.61 |
|
16.61 |
|
1,902,695 |
|
30,256,764 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
12.06 |
% |
13.98 |
% | |||
2016 |
|
10.21 |
|
14.59 |
|
1,741,400 |
|
24,600,438 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
14.24 |
% |
16.02 |
% | |||
Emerging Markets Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
14.16 |
|
$ |
92.71 |
|
8,202,236 |
|
$ |
204,655,526 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
15.00 |
% |
16.98 |
% |
2019 |
|
12.23 |
|
79.33 |
|
8,977,104 |
|
199,638,291 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
23.12 |
% |
25.23 |
% | |||
2018 |
|
9.86 |
|
63.42 |
|
9,588,606 |
|
178,868,614 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(13.75 |
)% |
(12.26 |
)% | |||
2017 |
|
11.24 |
|
72.35 |
|
9,314,917 |
|
211,020,836 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
31.86 |
% |
34.11 |
% | |||
2016 |
|
8.38 |
|
54.00 |
|
8,497,788 |
|
157,344,732 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
4.36 |
% |
6.04 |
% | |||
International Large-Cap Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
13.97 |
|
$ |
32.23 |
|
14,339,332 |
|
$ |
270,337,837 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
8.55 |
% |
10.41 |
% |
2019 |
|
12.81 |
|
29.23 |
|
15,285,757 |
|
264,096,383 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
25.50 |
% |
27.65 |
% | |||
2018 |
|
10.16 |
|
22.92 |
|
16,898,528 |
|
231,939,706 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(13.57 |
)% |
(12.08 |
)% | |||
2017 |
|
12.46 |
|
26.09 |
|
17,360,973 |
|
274,976,261 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
24.99 |
% |
27.00 |
% | |||
2016 |
|
9.97 |
|
20.54 |
|
19,170,325 |
|
242,468,735 |
|
0.00 |
% |
0.40 |
% |
2.00 |
% |
(2.05 |
)% |
(0.47 |
)% | |||
International Small-Cap Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
11.71 |
|
$ |
21.47 |
|
2,805,711 |
|
$ |
41,343,803 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
6.27 |
% |
8.10 |
% |
2019 |
|
10.94 |
|
19.95 |
|
3,062,801 |
|
41,971,971 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
17.69 |
% |
19.71 |
% | |||
2018 |
|
9.23 |
|
16.74 |
|
3,211,173 |
|
37,108,549 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(23.71 |
)% |
(22.39 |
)% | |||
2017 |
|
13.45 |
|
21.67 |
|
3,211,943 |
|
48,215,389 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
29.31 |
% |
31.39 |
% | |||
2016 |
|
10.52 |
|
16.55 |
|
3,378,509 |
|
38,784,671 |
|
0.00 |
% |
0.40 |
% |
2.00 |
% |
1.38 |
% |
3.01 |
% | |||
International Value Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
6.88 |
|
$ |
13.55 |
|
9,146,865 |
|
$ |
104,401,238 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(9.01 |
)% |
(7.45 |
)% |
2019 |
|
7.56 |
|
14.66 |
|
9,225,209 |
|
114,596,679 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
14.29 |
% |
16.25 |
% | |||
2018 |
|
6.61 |
|
12.68 |
|
9,595,349 |
|
103,783,244 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(16.65 |
)% |
(15.21 |
)% | |||
2017 |
|
7.93 |
|
15.12 |
|
9,834,920 |
|
126,982,696 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
19.17 |
% |
21.21 |
% | |||
2016 |
|
6.65 |
|
12.61 |
|
10,851,608 |
|
116,712,247 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
0.94 |
% |
2.57 |
% | |||
Health Sciences Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
17.10 |
|
$ |
89.57 |
|
7,254,306 |
|
$ |
319,284,574 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
16.43 |
% |
18.43 |
% |
2019 |
|
14.61 |
|
75.71 |
|
7,808,345 |
|
301,373,616 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
23.28 |
% |
25.39 |
% | |||
2018 |
|
11.79 |
|
60.44 |
|
8,381,895 |
|
269,301,230 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
5.75 |
% |
7.57 |
% | |||
2017 |
|
12.38 |
|
56.24 |
|
8,438,143 |
|
265,861,240 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
21.52 |
% |
23.47 |
% | |||
2016 |
|
15.41 |
|
45.55 |
|
8,528,700 |
|
231,374,915 |
|
0.00 |
% |
0.40 |
% |
2.00 |
% |
(7.83 |
)% |
(6.35 |
)% | |||
Real Estate Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
12.54 |
|
$ |
60.20 |
|
4,888,497 |
|
$ |
124,841,396 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(5.19 |
)% |
(3.57 |
)% |
2019 |
|
13.03 |
|
63.11 |
|
5,315,569 |
|
143,979,376 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
28.69 |
% |
30.89 |
% | |||
2018 |
|
9.98 |
|
48.75 |
|
5,741,006 |
|
121,398,736 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(9.29 |
)% |
(7.73 |
)% | |||
2017 |
|
10.84 |
|
53.42 |
|
6,555,664 |
|
153,948,997 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
1.20 |
% |
2.82 |
% | |||
2016 |
|
12.03 |
|
52.48 |
|
6,779,063 |
|
164,758,555 |
|
0.00 |
% |
0.40 |
% |
2.00 |
% |
4.49 |
% |
6.17 |
% |
See Notes to Financial Statements |
See explanation of references on pages SA-46 and SA-47 |
SEPARATE ACCOUNT A
FINANCIAL HIGHLIGHTS (Continued)
|
|
At the End of Each Year or Period |
|
Investment |
|
|
|
|
|
|
|
|
| |||||||||
Variable Accounts |
|
AUV (1) |
|
Units |
|
Net |
|
Income |
|
Expense Ratios (3) |
|
Total Returns (4) |
| |||||||||
For Each Year or Period |
|
Lowest |
|
Highest |
|
Outstanding |
|
Assets |
|
Ratios (2) |
|
Lowest |
|
Highest |
|
Lowest |
|
Highest |
| |||
Technology Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
17.05 |
|
$ |
35.18 |
|
7,706,962 |
|
$ |
208,731,278 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
44.33 |
% |
46.80 |
% |
2019 |
|
11.79 |
|
24.32 |
|
7,653,316 |
|
142,235,523 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
33.62 |
% |
35.91 |
% | |||
2018 |
|
8.80 |
|
18.15 |
|
7,966,233 |
|
109,014,566 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(0.24 |
)% |
1.48 |
% | |||
2017 |
|
8.80 |
|
18.15 |
|
7,597,226 |
|
102,089,215 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
36.05 |
% |
38.23 |
% | |||
2016 |
|
6.45 |
|
13.31 |
|
6,864,188 |
|
66,534,514 |
|
0.00 |
% |
0.40 |
% |
2.00 |
% |
(8.46 |
)% |
(6.98 |
)% | |||
PSF DFA Balanced Allocation Class D |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
2020 |
|
$ |
12.90 |
|
$ |
14.72 |
|
20,364,483 |
|
$ |
287,800,621 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
9.89 |
% |
11.77 |
% |
2019 |
|
11.71 |
|
13.18 |
|
17,533,417 |
|
223,629,160 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
17.38 |
% |
19.39 |
% | |||
2018 |
|
9.95 |
|
11.05 |
|
13,984,638 |
|
150,670,897 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(8.06 |
)% |
(6.47 |
)% | |||
2017 |
|
10.84 |
|
11.83 |
|
8,143,033 |
|
94,769,463 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
10.75 |
% |
12.53 |
% | |||
05/03/2016 - 12/31/2016 |
|
10.40 |
|
10.51 |
|
3,046,252 |
|
31,822,324 |
|
0.00 |
% |
0.40 |
% |
2.00 |
% |
4.78 |
% |
4.78 |
% | |||
Pacific Dynamix - Conservative Growth Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
2020 |
|
$ |
12.68 |
|
$ |
22.62 |
|
34,235,499 |
|
$ |
566,126,949 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
9.99 |
% |
11.88 |
% |
2019 |
|
11.45 |
|
20.24 |
|
33,572,437 |
|
504,881,921 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
13.18 |
% |
15.12 |
% | |||
2018 |
|
10.05 |
|
17.60 |
|
34,320,308 |
|
457,602,754 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(5.76 |
)% |
(4.13 |
)% | |||
2017 |
|
10.59 |
|
18.38 |
|
34,531,502 |
|
491,604,838 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
7.77 |
% |
9.50 |
% | |||
2016 |
|
10.90 |
|
16.78 |
|
34,779,910 |
|
464,351,611 |
|
0.00 |
% |
0.40 |
% |
2.00 |
% |
4.73 |
% |
6.41 |
% | |||
Pacific Dynamix - Moderate Growth Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
2020 |
|
$ |
13.22 |
|
$ |
27.13 |
|
136,145,159 |
|
$ |
2,492,898,271 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
12.31 |
% |
14.24 |
% |
2019 |
|
11.74 |
|
23.78 |
|
140,905,132 |
|
2,309,891,015 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
16.59 |
% |
18.58 |
% | |||
2018 |
|
10.04 |
|
20.07 |
|
144,819,535 |
|
2,056,345,198 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(7.41 |
)% |
(5.81 |
)% | |||
2017 |
|
10.84 |
|
21.33 |
|
142,605,677 |
|
2,214,319,925 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
11.54 |
% |
13.45 |
% | |||
2016 |
|
10.17 |
|
18.82 |
|
131,642,580 |
|
1,858,370,366 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
6.31 |
% |
8.02 |
% | |||
Pacific Dynamix - Growth Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
2020 |
|
$ |
14.01 |
|
$ |
32.07 |
|
52,279,480 |
|
$ |
1,095,441,256 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
13.50 |
% |
15.44 |
% |
2019 |
|
12.28 |
|
27.81 |
|
37,812,246 |
|
744,887,106 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
20.50 |
% |
22.57 |
% | |||
2018 |
|
10.14 |
|
22.71 |
|
37,185,605 |
|
622,881,911 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(9.13 |
)% |
(7.56 |
)% | |||
2017 |
|
11.10 |
|
24.59 |
|
36,584,813 |
|
681,743,289 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
15.20 |
% |
17.05 |
% | |||
2016 |
|
10.21 |
|
21.01 |
|
34,116,830 |
|
559,105,960 |
|
0.00 |
% |
0.40 |
% |
2.00 |
% |
8.00 |
% |
9.73 |
% | |||
Portfolio Optimization Conservative Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
2020 |
|
$ |
11.66 |
|
$ |
14.92 |
|
115,277,984 |
|
$ |
1,534,716,340 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
5.75 |
% |
7.56 |
% |
2019 |
|
10.95 |
|
13.88 |
|
112,674,680 |
|
1,415,956,727 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
9.98 |
% |
11.86 |
% | |||
2018 |
|
9.89 |
|
12.42 |
|
122,666,989 |
|
1,395,000,702 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(5.30 |
)% |
(3.67 |
)% | |||
2017 |
|
10.37 |
|
12.91 |
|
140,870,741 |
|
1,684,288,523 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
5.25 |
% |
7.05 |
% | |||
2016 |
|
10.11 |
|
12.07 |
|
165,728,474 |
|
1,873,697,960 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
3.74 |
% |
5.41 |
% | |||
Portfolio Optimization Moderate-Conservative Class I |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
2020 |
|
$ |
12.29 |
|
$ |
16.60 |
|
143,065,548 |
|
$ |
2,134,143,003 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
7.79 |
% |
9.64 |
% |
2019 |
|
11.32 |
|
15.15 |
|
160,008,744 |
|
2,202,281,279 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
13.00 |
% |
14.93 |
% | |||
2018 |
|
9.95 |
|
13.22 |
|
182,298,210 |
|
2,208,202,437 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(6.88 |
)% |
(5.27 |
)% | |||
2017 |
|
10.61 |
|
14.02 |
|
211,675,881 |
|
2,738,883,461 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
8.60 |
% |
10.35 |
% | |||
2016 |
|
10.78 |
|
12.75 |
|
239,465,540 |
|
2,839,652,691 |
|
0.00 |
% |
0.40 |
% |
2.00 |
% |
4.68 |
% |
6.36 |
% | |||
Portfolio Optimization Moderate Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
2020 |
|
$ |
12.62 |
|
$ |
18.57 |
|
548,864,454 |
|
$ |
8,961,811,838 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
9.61 |
% |
11.49 |
% |
2019 |
|
11.49 |
|
16.73 |
|
615,901,678 |
|
9,125,390,297 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
16.11 |
% |
18.10 |
% | |||
2018 |
|
9.87 |
|
14.23 |
|
705,768,256 |
|
8,963,320,335 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(8.41 |
)% |
(6.83 |
)% | |||
2017 |
|
10.78 |
|
15.35 |
|
807,845,322 |
|
11,150,490,771 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
10.98 |
% |
12.88 |
% | |||
2016 |
|
10.16 |
|
13.66 |
|
911,170,206 |
|
11,277,155,614 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
5.95 |
% |
7.65 |
% | |||
Portfolio Optimization Growth Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
2020 |
|
$ |
14.62 |
|
$ |
20.63 |
|
439,483,300 |
|
$ |
7,748,073,547 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
10.49 |
% |
12.39 |
% |
2019 |
|
13.04 |
|
18.44 |
|
492,110,249 |
|
7,818,850,939 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
19.25 |
% |
21.29 |
% | |||
2018 |
|
10.77 |
|
15.27 |
|
563,059,591 |
|
7,468,425,206 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(10.02 |
)% |
(8.47 |
)% | |||
2017 |
|
11.82 |
|
16.76 |
|
645,370,093 |
|
9,470,596,190 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
14.09 |
% |
16.04 |
% | |||
2016 |
|
10.18 |
|
14.59 |
|
731,102,068 |
|
9,362,255,525 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
6.66 |
% |
8.38 |
% | |||
Portfolio Optimization Aggressive-Growth Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
2020 |
|
$ |
13.47 |
|
$ |
21.86 |
|
89,683,364 |
|
$ |
1,627,065,563 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
10.23 |
% |
12.12 |
% |
2019 |
|
12.16 |
|
19.59 |
|
101,347,267 |
|
1,659,745,072 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
21.31 |
% |
23.39 |
% | |||
2018 |
|
9.97 |
|
15.95 |
|
117,617,743 |
|
1,580,123,542 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(11.20 |
)% |
(9.67 |
)% | |||
2017 |
|
12.06 |
|
17.83 |
|
132,519,299 |
|
1,996,079,978 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
16.25 |
% |
18.12 |
% | |||
2016 |
|
12.05 |
|
15.27 |
|
150,050,357 |
|
1,935,350,732 |
|
0.00 |
% |
0.40 |
% |
2.00 |
% |
7.17 |
% |
8.89 |
% |
See Notes to Financial Statements |
See explanation of references on pages SA-46 and SA-47 |
SEPARATE ACCOUNT A
FINANCIAL HIGHLIGHTS (Continued)
|
|
At the End of Each Year |
|
Investment |
|
|
|
|
|
|
|
|
| |||||||||
Variable Accounts |
|
AUV (1) |
|
Units |
|
Net |
|
Income |
|
Expense Ratios (3) |
|
Total Returns (4) |
| |||||||||
For Each Year |
|
Lowest |
|
Highest |
|
Outstanding |
|
Assets |
|
Ratios (2) |
|
Lowest |
|
Highest |
|
Lowest |
|
Highest |
| |||
Invesco Oppenheimer V.I. Global Series II |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
2020 |
|
$ |
17.12 |
|
$ |
19.72 |
|
1,257,546 |
|
$ |
22,746,069 |
|
0.43 |
% |
0.30 |
% |
2.00 |
% |
24.82 |
% |
26.96 |
% |
2019 |
|
13.62 |
|
15.53 |
|
1,488,720 |
|
21,391,688 |
|
0.64 |
% |
0.30 |
% |
2.00 |
% |
28.85 |
% |
31.06 |
% | |||
2018 |
|
10.50 |
|
11.85 |
|
1,385,063 |
|
15,319,920 |
|
0.85 |
% |
0.30 |
% |
2.00 |
% |
(15.12 |
)% |
(13.65 |
)% | |||
2017 |
|
12.28 |
|
13.72 |
|
1,407,294 |
|
18,166,007 |
|
0.71 |
% |
0.30 |
% |
2.00 |
% |
33.63 |
% |
35.78 |
% | |||
2016 |
|
9.52 |
|
9.70 |
|
193,754 |
|
1,856,673 |
|
0.75 |
% |
0.40 |
% |
2.00 |
% |
(1.88 |
)% |
(1.30 |
)% | |||
Invesco Oppenheimer V.I. International Growth Series II |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
2020 |
|
$ |
13.64 |
|
$ |
16.01 |
|
1,294,995 |
|
$ |
18,636,307 |
|
0.66 |
% |
0.30 |
% |
2.00 |
% |
18.65 |
% |
20.68 |
% |
2019 |
|
11.50 |
|
13.26 |
|
1,226,707 |
|
14,698,332 |
|
0.72 |
% |
0.30 |
% |
2.00 |
% |
25.42 |
% |
27.57 |
% | |||
2018 |
|
9.17 |
|
10.40 |
|
1,233,981 |
|
11,685,079 |
|
0.62 |
% |
0.30 |
% |
2.00 |
% |
(21.15 |
)% |
(19.79 |
)% | |||
2017 |
|
11.63 |
|
12.96 |
|
901,922 |
|
10,707,364 |
|
1.14 |
% |
0.30 |
% |
2.00 |
% |
23.95 |
% |
25.94 |
% | |||
2016 |
|
9.38 |
|
9.56 |
|
359,358 |
|
3,397,657 |
|
0.81 |
% |
0.40 |
% |
2.00 |
% |
(4.40 |
)% |
(3.10 |
)% | |||
Invesco V.I. Balanced-Risk Allocation Series II |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
2020 |
|
$ |
12.03 |
|
$ |
24.11 |
|
18,600,508 |
|
$ |
314,909,858 |
|
7.66 |
% |
0.30 |
% |
2.00 |
% |
7.81 |
% |
9.66 |
% |
2019 |
|
11.02 |
|
22.01 |
|
20,202,936 |
|
320,444,489 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
12.61 |
% |
14.54 |
% | |||
2018 |
|
9.74 |
|
19.24 |
|
22,504,624 |
|
322,179,645 |
|
1.27 |
% |
0.30 |
% |
2.00 |
% |
(8.57 |
)% |
(6.99 |
)% | |||
2017 |
|
10.60 |
|
20.70 |
|
25,137,938 |
|
400,851,209 |
|
3.72 |
% |
0.30 |
% |
2.00 |
% |
7.66 |
% |
9.50 |
% | |||
2016 |
|
10.15 |
|
18.92 |
|
27,202,624 |
|
411,438,619 |
|
0.20 |
% |
0.30 |
% |
2.00 |
% |
9.31 |
% |
11.07 |
% | |||
Invesco V.I. Equity and Income Series II |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
2020 |
|
$ |
12.18 |
|
$ |
15.24 |
|
3,865,857 |
|
$ |
55,228,668 |
|
2.23 |
% |
0.30 |
% |
2.00 |
% |
7.48 |
% |
9.32 |
% |
2019 |
|
11.27 |
|
13.95 |
|
3,947,659 |
|
51,983,779 |
|
2.36 |
% |
0.30 |
% |
2.00 |
% |
17.63 |
% |
19.65 |
% | |||
2018 |
|
9.54 |
|
11.67 |
|
3,724,610 |
|
41,332,203 |
|
2.07 |
% |
0.30 |
% |
2.00 |
% |
(11.53 |
)% |
(10.00 |
)% | |||
2017 |
|
11.18 |
|
12.98 |
|
3,319,215 |
|
41,292,384 |
|
1.44 |
% |
0.30 |
% |
2.00 |
% |
8.59 |
% |
10.34 |
% | |||
2016 |
|
11.17 |
|
11.77 |
|
3,032,859 |
|
34,520,360 |
|
1.73 |
% |
0.40 |
% |
2.00 |
% |
12.57 |
% |
14.38 |
% | |||
Invesco V.I. Global Real Estate Series II |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
2020 |
|
$ |
9.73 |
|
$ |
11.59 |
|
776,994 |
|
$ |
7,940,183 |
|
4.78 |
% |
0.30 |
% |
2.00 |
% |
(14.30 |
)% |
(12.82 |
)% |
2019 |
|
11.35 |
|
13.30 |
|
810,384 |
|
9,561,900 |
|
3.62 |
% |
0.30 |
% |
2.00 |
% |
20.22 |
% |
22.28 |
% | |||
2018 |
|
9.44 |
|
10.87 |
|
643,423 |
|
6,257,587 |
|
3.77 |
% |
0.30 |
% |
2.00 |
% |
(8.20 |
)% |
(6.62 |
)% | |||
2017 |
|
10.28 |
|
11.64 |
|
566,539 |
|
5,943,149 |
|
3.36 |
% |
0.30 |
% |
2.00 |
% |
10.50 |
% |
12.39 |
% | |||
2016 |
|
9.30 |
|
10.36 |
|
397,040 |
|
3,734,563 |
|
1.79 |
% |
0.30 |
% |
2.00 |
% |
(0.19 |
)% |
1.41 |
% | |||
American Century VP Mid Cap Value Class II |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
2020 |
|
$ |
11.63 |
|
$ |
21.90 |
|
4,475,406 |
|
$ |
84,023,806 |
|
1.67 |
% |
0.30 |
% |
2.00 |
% |
(0.89 |
)% |
0.81 |
% |
2019 |
|
11.67 |
|
21.75 |
|
4,696,915 |
|
88,473,524 |
|
1.90 |
% |
0.30 |
% |
2.00 |
% |
26.44 |
% |
28.61 |
% | |||
2018 |
|
9.19 |
|
16.93 |
|
4,648,111 |
|
69,290,350 |
|
1.27 |
% |
0.30 |
% |
2.00 |
% |
(14.70 |
)% |
(13.22 |
)% | |||
2017 |
|
10.73 |
|
19.52 |
|
4,449,662 |
|
78,338,816 |
|
1.39 |
% |
0.30 |
% |
2.00 |
% |
9.27 |
% |
11.13 |
% | |||
2016 |
|
10.13 |
|
17.59 |
|
4,449,907 |
|
72,613,873 |
|
1.62 |
% |
0.30 |
% |
2.00 |
% |
20.29 |
% |
22.23 |
% | |||
American Funds IS Asset Allocation Fund Class 4 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
2020 |
|
$ |
13.42 |
|
$ |
16.37 |
|
237,956,490 |
|
$ |
3,586,425,606 |
|
1.47 |
% |
0.30 |
% |
2.00 |
% |
9.94 |
% |
11.82 |
% |
2019 |
|
12.14 |
|
14.71 |
|
243,250,672 |
|
3,309,209,188 |
|
1.73 |
% |
0.30 |
% |
2.00 |
% |
18.53 |
% |
20.56 |
% | |||
2018 |
|
10.19 |
|
12.25 |
|
246,768,480 |
|
2,810,176,638 |
|
1.46 |
% |
0.30 |
% |
2.00 |
% |
(6.73 |
)% |
(5.12 |
)% | |||
2017 |
|
10.87 |
|
12.97 |
|
240,961,888 |
|
2,922,206,753 |
|
1.37 |
% |
0.30 |
% |
2.00 |
% |
13.62 |
% |
15.56 |
% | |||
2016 |
|
10.11 |
|
11.28 |
|
231,803,255 |
|
2,457,433,788 |
|
1.48 |
% |
0.30 |
% |
2.00 |
% |
7.01 |
% |
8.73 |
% | |||
American Funds IS Blue Chip Income and Growth Class 4 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
2020 |
|
$ |
12.69 |
|
$ |
15.85 |
|
9,569,016 |
|
$ |
144,970,879 |
|
1.63 |
% |
0.30 |
% |
2.00 |
% |
6.32 |
% |
8.15 |
% |
2019 |
|
11.88 |
|
14.67 |
|
8,965,013 |
|
126,418,067 |
|
2.08 |
% |
0.30 |
% |
2.00 |
% |
18.64 |
% |
20.67 |
% | |||
2018 |
|
9.96 |
|
12.17 |
|
7,269,940 |
|
85,722,867 |
|
1.96 |
% |
0.30 |
% |
2.00 |
% |
(10.73 |
)% |
(9.19 |
)% | |||
2017 |
|
11.12 |
|
13.41 |
|
5,772,293 |
|
75,700,161 |
|
2.06 |
% |
0.30 |
% |
2.00 |
% |
14.40 |
% |
16.24 |
% | |||
2016 |
|
11.33 |
|
11.54 |
|
4,525,632 |
|
51,646,555 |
|
3.61 |
% |
0.40 |
% |
2.00 |
% |
16.39 |
% |
18.02 |
% | |||
American Funds IS Bond Class 4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
2020 |
|
$ |
11.23 |
|
$ |
12.20 |
|
10,104,867 |
|
$ |
119,129,680 |
|
2.23 |
% |
0.30 |
% |
2.00 |
% |
7.21 |
% |
9.05 |
% |
2019 |
|
10.48 |
|
11.20 |
|
6,600,411 |
|
71,857,165 |
|
2.80 |
% |
0.30 |
% |
2.00 |
% |
6.92 |
% |
8.75 |
% | |||
2018 |
|
9.80 |
|
10.31 |
|
4,611,732 |
|
46,516,940 |
|
2.63 |
% |
0.30 |
% |
2.00 |
% |
(2.71 |
)% |
(1.18 |
)% | |||
2017 |
|
10.12 |
|
10.44 |
|
3,034,732 |
|
31,215,177 |
|
2.50 |
% |
0.30 |
% |
2.00 |
% |
1.40 |
% |
2.98 |
% | |||
2016 |
|
9.96 |
|
10.15 |
|
1,486,630 |
|
14,962,175 |
|
2.17 |
% |
0.30 |
% |
2.00 |
% |
0.92 |
% |
2.39 |
% | |||
American Funds IS Capital Income Builder Class 4 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
2020 |
|
$ |
11.39 |
|
$ |
12.90 |
|
8,994,388 |
|
$ |
108,919,873 |
|
2.65 |
% |
0.30 |
% |
2.00 |
% |
2.05 |
% |
3.80 |
% |
2019 |
|
11.16 |
|
12.43 |
|
9,363,187 |
|
110,011,255 |
|
2.68 |
% |
0.30 |
% |
2.00 |
% |
15.29 |
% |
17.27 |
% | |||
2018 |
|
9.68 |
|
10.60 |
|
8,466,870 |
|
85,368,961 |
|
2.72 |
% |
0.30 |
% |
2.00 |
% |
(9.10 |
)% |
(7.53 |
)% | |||
2017 |
|
10.65 |
|
11.46 |
|
7,548,239 |
|
82,933,134 |
|
2.57 |
% |
0.30 |
% |
2.00 |
% |
10.42 |
% |
12.20 |
% | |||
2016 |
|
9.64 |
|
10.06 |
|
6,532,328 |
|
64,382,863 |
|
3.09 |
% |
0.40 |
% |
2.00 |
% |
1.74 |
% |
3.37 |
% |
See Notes to Financial Statements |
See explanation of references on pages SA-46 and SA-47 |
SEPARATE ACCOUNT A
FINANCIAL HIGHLIGHTS (Continued)
|
|
At the End of Each Year |
|
Investment |
|
|
|
|
|
|
|
|
| |||||||||
Variable Accounts |
|
AUV (1) |
|
Units |
|
Net |
|
Income |
|
Expense Ratios (3) |
|
Total Returns (4) |
| |||||||||
For Each Year |
|
Lowest |
|
Highest |
|
Outstanding |
|
Assets |
|
Ratios (2) |
|
Lowest |
|
Highest |
|
Lowest |
|
Highest |
| |||
American Funds IS Capital World Bond Class 4 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
2020 |
|
$ |
11.22 |
|
$ |
12.24 |
|
1,710,525 |
|
$ |
20,165,750 |
|
1.11 |
% |
0.30 |
% |
2.00 |
% |
7.45 |
% |
9.29 |
% |
2019 |
|
10.44 |
|
11.20 |
|
1,477,082 |
|
16,045,481 |
|
1.46 |
% |
0.30 |
% |
2.00 |
% |
5.41 |
% |
7.21 |
% | |||
2018 |
|
9.90 |
|
10.45 |
|
1,258,572 |
|
12,821,962 |
|
2.20 |
% |
0.30 |
% |
2.00 |
% |
(3.57 |
)% |
(1.90 |
)% | |||
2017 |
|
10.27 |
|
10.65 |
|
836,041 |
|
8,739,645 |
|
0.52 |
% |
0.30 |
% |
2.00 |
% |
4.53 |
% |
6.21 |
% | |||
2016 |
|
9.83 |
|
10.01 |
|
433,050 |
|
4,294,379 |
|
0.76 |
% |
0.40 |
% |
2.00 |
% |
0.90 |
% |
2.01 |
% | |||
American Funds IS Global Balanced Class 4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
2020 |
|
$ |
13.67 |
|
$ |
14.85 |
|
4,845,740 |
|
$ |
69,376,992 |
|
0.89 |
% |
0.30 |
% |
2.00 |
% |
7.82 |
% |
9.67 |
% |
2019 |
|
12.68 |
|
13.55 |
|
4,799,248 |
|
63,144,585 |
|
1.14 |
% |
0.30 |
% |
2.00 |
% |
17.83 |
% |
19.85 |
% | |||
2018 |
|
10.76 |
|
11.32 |
|
4,336,770 |
|
47,966,295 |
|
1.17 |
% |
0.30 |
% |
2.00 |
% |
(8.18 |
)% |
(6.59 |
)% | |||
2017 |
|
11.72 |
|
12.13 |
|
3,314,682 |
|
39,520,262 |
|
1.59 |
% |
0.30 |
% |
2.00 |
% |
17.02 |
% |
18.90 |
% | |||
2016 |
|
10.01 |
|
10.20 |
|
915,019 |
|
9,252,896 |
|
2.43 |
% |
0.40 |
% |
2.00 |
% |
2.15 |
% |
3.43 |
% | |||
American Funds IS Global Growth and Income Class 4 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
2020 |
|
$ |
14.20 |
|
$ |
16.54 |
|
3,388,396 |
|
$ |
54,092,872 |
|
1.16 |
% |
0.30 |
% |
2.00 |
% |
6.40 |
% |
8.22 |
% |
2019 |
|
13.28 |
|
15.30 |
|
3,022,917 |
|
44,898,187 |
|
1.93 |
% |
0.30 |
% |
2.00 |
% |
28.14 |
% |
30.34 |
% | |||
2018 |
|
10.31 |
|
11.75 |
|
2,456,273 |
|
28,176,906 |
|
1.68 |
% |
0.30 |
% |
2.00 |
% |
(11.68 |
)% |
(10.16 |
)% | |||
2017 |
|
11.63 |
|
13.09 |
|
1,693,500 |
|
21,786,618 |
|
3.04 |
% |
0.30 |
% |
2.00 |
% |
23.34 |
% |
25.32 |
% | |||
2016 |
|
10.25 |
|
10.44 |
|
758,235 |
|
7,847,080 |
|
3.07 |
% |
0.40 |
% |
2.00 |
% |
5.29 |
% |
6.61 |
% | |||
American Funds IS Global Growth Class 4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
2020 |
|
$ |
18.04 |
|
$ |
23.54 |
|
6,822,409 |
|
$ |
150,256,254 |
|
0.16 |
% |
0.30 |
% |
2.00 |
% |
27.59 |
% |
29.78 |
% |
2019 |
|
14.07 |
|
18.15 |
|
6,719,991 |
|
115,088,564 |
|
1.00 |
% |
0.30 |
% |
2.00 |
% |
32.20 |
% |
34.47 |
% | |||
2018 |
|
10.59 |
|
13.51 |
|
6,148,518 |
|
78,942,770 |
|
0.55 |
% |
0.30 |
% |
2.00 |
% |
(11.05 |
)% |
(9.51 |
)% | |||
2017 |
|
11.84 |
|
14.95 |
|
4,938,435 |
|
70,733,670 |
|
0.67 |
% |
0.30 |
% |
2.00 |
% |
28.53 |
% |
30.59 |
% | |||
2016 |
|
10.69 |
|
11.45 |
|
3,597,971 |
|
39,881,916 |
|
0.70 |
% |
0.40 |
% |
2.00 |
% |
(1.61 |
)% |
(0.03 |
)% | |||
American Funds IS Global Small Capitalization Class 4 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
2020 |
|
$ |
16.72 |
|
$ |
18.88 |
|
1,990,423 |
|
$ |
36,147,533 |
|
0.13 |
% |
0.30 |
% |
2.00 |
% |
26.83 |
% |
29.00 |
% |
2019 |
|
13.12 |
|
14.64 |
|
1,840,128 |
|
26,084,787 |
|
0.01 |
% |
0.30 |
% |
2.00 |
% |
28.65 |
% |
30.85 |
% | |||
2018 |
|
10.15 |
|
11.19 |
|
1,471,715 |
|
16,044,129 |
|
0.02 |
% |
0.30 |
% |
2.00 |
% |
(12.58 |
)% |
(11.07 |
)% | |||
2017 |
|
11.57 |
|
12.58 |
|
705,959 |
|
8,722,876 |
|
0.39 |
% |
0.30 |
% |
2.00 |
% |
23.14 |
% |
25.12 |
% | |||
2016 |
|
9.83 |
|
10.02 |
|
269,230 |
|
2,676,622 |
|
0.17 |
% |
0.40 |
% |
2.00 |
% |
(0.01 |
)% |
1.44 |
% | |||
American Funds IS Growth Class 4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
2020 |
|
$ |
21.83 |
|
$ |
30.31 |
|
24,975,444 |
|
$ |
648,933,173 |
|
0.20 |
% |
0.30 |
% |
2.00 |
% |
48.71 |
% |
51.26 |
% |
2019 |
|
14.61 |
|
20.13 |
|
25,959,828 |
|
449,220,933 |
|
0.57 |
% |
0.30 |
% |
2.00 |
% |
27.86 |
% |
30.05 |
% | |||
2018 |
|
11.37 |
|
15.55 |
|
26,297,274 |
|
352,634,575 |
|
0.26 |
% |
0.30 |
% |
2.00 |
% |
(2.49 |
)% |
(0.80 |
)% | |||
2017 |
|
11.62 |
|
15.75 |
|
25,511,615 |
|
348,008,852 |
|
0.45 |
% |
0.30 |
% |
2.00 |
% |
25.46 |
% |
27.60 |
% | |||
2016 |
|
10.13 |
|
12.39 |
|
24,270,285 |
|
261,801,967 |
|
0.59 |
% |
0.30 |
% |
2.00 |
% |
7.06 |
% |
8.78 |
% | |||
American Funds IS Growth-Income Class 4 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
2020 |
|
$ |
15.15 |
|
$ |
19.82 |
|
22,979,190 |
|
$ |
406,479,221 |
|
1.16 |
% |
0.30 |
% |
2.00 |
% |
11.01 |
% |
12.91 |
% |
2019 |
|
13.58 |
|
17.63 |
|
24,612,458 |
|
388,579,894 |
|
1.50 |
% |
0.30 |
% |
2.00 |
% |
23.36 |
% |
25.48 |
% | |||
2018 |
|
10.95 |
|
14.12 |
|
25,499,425 |
|
323,650,289 |
|
1.25 |
% |
0.30 |
% |
2.00 |
% |
(4.01 |
)% |
(2.35 |
)% | |||
2017 |
|
11.35 |
|
14.52 |
|
25,370,686 |
|
332,875,994 |
|
1.30 |
% |
0.30 |
% |
2.00 |
% |
19.67 |
% |
21.59 |
% | |||
2016 |
|
10.68 |
|
11.98 |
|
25,849,115 |
|
281,066,393 |
|
1.32 |
% |
0.40 |
% |
2.00 |
% |
9.06 |
% |
10.81 |
% | |||
American Funds IS High-Income Bond Class 4 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
2020 |
|
$ |
11.65 |
|
$ |
13.69 |
|
2,696,891 |
|
$ |
35,347,472 |
|
8.06 |
% |
0.30 |
% |
1.95 |
% |
5.66 |
% |
7.41 |
% |
2019 |
|
10.95 |
|
12.76 |
|
2,603,736 |
|
31,991,057 |
|
6.27 |
% |
0.30 |
% |
1.95 |
% |
10.10 |
% |
11.93 |
% | |||
2018 |
|
9.88 |
|
11.41 |
|
1,818,203 |
|
20,145,019 |
|
5.59 |
% |
0.30 |
% |
1.95 |
% |
(4.53 |
)% |
(2.93 |
)% | |||
2017 |
|
10.28 |
|
11.76 |
|
1,647,144 |
|
18,994,266 |
|
7.09 |
% |
0.30 |
% |
2.00 |
% |
4.58 |
% |
6.21 |
% | |||
2016 |
|
10.87 |
|
11.08 |
|
990,390 |
|
10,865,001 |
|
9.47 |
% |
0.40 |
% |
2.00 |
% |
15.15 |
% |
16.83 |
% | |||
American Funds IS International Class 4 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
2020 |
|
$ |
13.21 |
|
$ |
15.77 |
|
7,177,101 |
|
$ |
101,270,614 |
|
0.45 |
% |
0.30 |
% |
2.00 |
% |
11.41 |
% |
13.32 |
% |
2019 |
|
11.86 |
|
13.91 |
|
7,321,305 |
|
91,758,888 |
|
1.39 |
% |
0.30 |
% |
2.00 |
% |
20.24 |
% |
22.30 |
% | |||
2018 |
|
9.86 |
|
11.38 |
|
5,877,732 |
|
60,534,823 |
|
1.63 |
% |
0.30 |
% |
2.00 |
% |
(15.13 |
)% |
(13.67 |
)% | |||
2017 |
|
11.62 |
|
13.18 |
|
4,423,951 |
|
53,104,234 |
|
1.59 |
% |
0.30 |
% |
2.00 |
% |
29.29 |
% |
31.37 |
% | |||
2016 |
|
8.99 |
|
9.38 |
|
2,850,606 |
|
26,203,366 |
|
1.40 |
% |
0.40 |
% |
2.00 |
% |
1.18 |
% |
2.81 |
% | |||
American Funds IS International Growth and Income Class 4 |
|
|
|
|
|
|
|
|
|
|
| |||||||||||
2020 |
|
$ |
11.54 |
|
$ |
14.45 |
|
4,731,166 |
|
$ |
58,569,477 |
|
1.33 |
% |
0.30 |
% |
2.00 |
% |
3.64 |
% |
5.42 |
% |
2019 |
|
11.08 |
|
13.71 |
|
4,691,520 |
|
55,508,509 |
|
2.42 |
% |
0.30 |
% |
2.00 |
% |
20.04 |
% |
22.10 |
% | |||
2018 |
|
9.18 |
|
11.23 |
|
4,409,965 |
|
43,001,936 |
|
2.08 |
% |
0.30 |
% |
2.00 |
% |
(13.22 |
)% |
(11.73 |
)% | |||
2017 |
|
10.53 |
|
12.72 |
|
3,960,415 |
|
44,043,588 |
|
2.25 |
% |
0.30 |
% |
2.00 |
% |
22.26 |
% |
24.22 |
% | |||
2016 |
|
8.57 |
|
9.35 |
|
3,353,345 |
|
30,194,240 |
|
2.55 |
% |
0.40 |
% |
2.00 |
% |
(0.82 |
)% |
0.78 |
% |
See Notes to Financial Statements |
See explanation of references on pages SA-46 and SA-47 |
SEPARATE ACCOUNT A
FINANCIAL HIGHLIGHTS (Continued)
|
|
At the End of Each Year |
|
Investment |
|
|
|
|
|
|
|
|
| |||||||||
Variable Accounts |
|
AUV (1) |
|
Units |
|
Net |
|
Income |
|
Expense Ratios (3) |
|
Total Returns (4) |
| |||||||||
For Each Year |
|
Lowest |
|
Highest |
|
Outstanding |
|
Assets |
|
Ratios (2) |
|
Lowest |
|
Highest |
|
Lowest |
|
Highest |
| |||
American Funds IS Managed Risk Asset Allocation Class P2 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
2020 |
|
$ |
12.27 |
|
$ |
14.93 |
|
11,596,589 |
|
$ |
162,109,838 |
|
1.51 |
% |
0.30 |
% |
2.00 |
% |
3.79 |
% |
5.57 |
% |
2019 |
|
11.76 |
|
14.15 |
|
10,804,760 |
|
144,266,036 |
|
2.29 |
% |
0.30 |
% |
2.00 |
% |
15.65 |
% |
17.63 |
% | |||
2018 |
|
10.12 |
|
12.05 |
|
10,040,824 |
|
115,008,587 |
|
1.37 |
% |
0.30 |
% |
2.00 |
% |
(6.79 |
)% |
(5.18 |
)% | |||
2017 |
|
10.80 |
|
12.72 |
|
9,214,722 |
|
112,457,169 |
|
0.75 |
% |
0.30 |
% |
2.00 |
% |
12.54 |
% |
14.35 |
% | |||
2016 |
|
10.57 |
|
11.12 |
|
7,433,311 |
|
80,098,222 |
|
1.32 |
% |
0.40 |
% |
2.00 |
% |
5.16 |
% |
6.85 |
% | |||
American Funds IS New World Fund Class 4 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
2020 |
|
$ |
14.47 |
|
$ |
17.59 |
|
4,414,153 |
|
$ |
68,148,249 |
|
0.04 |
% |
0.30 |
% |
2.00 |
% |
20.85 |
% |
22.92 |
% |
2019 |
|
11.97 |
|
14.31 |
|
4,568,328 |
|
57,614,643 |
|
0.79 |
% |
0.30 |
% |
2.00 |
% |
26.27 |
% |
28.43 |
% | |||
2018 |
|
9.48 |
|
11.14 |
|
4,358,296 |
|
43,131,184 |
|
0.71 |
% |
0.30 |
% |
2.00 |
% |
(15.96 |
)% |
(14.51 |
)% | |||
2017 |
|
11.28 |
|
13.03 |
|
3,663,500 |
|
42,750,898 |
|
0.90 |
% |
0.30 |
% |
2.00 |
% |
26.51 |
% |
28.67 |
% | |||
2016 |
|
8.92 |
|
10.13 |
|
2,663,757 |
|
24,333,989 |
|
0.71 |
% |
0.30 |
% |
2.00 |
% |
2.97 |
% |
4.62 |
% | |||
American Funds IS U.S. Government/AAA-Rated Securities Class 4 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
2020 |
|
$ |
10.75 |
|
$ |
12.05 |
|
10,237,716 |
|
$ |
115,980,599 |
|
1.89 |
% |
0.30 |
% |
2.00 |
% |
7.32 |
% |
9.15 |
% |
2019 |
|
10.01 |
|
11.05 |
|
4,886,622 |
|
51,395,885 |
|
1.99 |
% |
0.30 |
% |
2.00 |
% |
3.06 |
% |
4.83 |
% | |||
2018 |
|
9.72 |
|
10.55 |
|
4,222,318 |
|
42,708,133 |
|
1.72 |
% |
0.30 |
% |
2.00 |
% |
(1.45 |
)% |
0.20 |
% | |||
2017 |
|
9.88 |
|
10.54 |
|
3,866,724 |
|
39,414,908 |
|
1.07 |
% |
0.30 |
% |
1.95 |
% |
(0.67 |
)% |
0.87 |
% | |||
2016 |
|
9.95 |
|
10.45 |
|
4,618,164 |
|
46,987,916 |
|
1.04 |
% |
0.40 |
% |
2.00 |
% |
(0.95 |
)% |
0.59 |
% | |||
BlackRock 60/40 Target Allocation ETF V.I. Class I |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
2020 |
|
$ |
13.81 |
|
$ |
15.36 |
|
7,597,641 |
|
$ |
110,851,315 |
|
1.99 |
% |
0.30 |
% |
2.00 |
% |
12.57 |
% |
14.32 |
% |
2019 |
|
12.26 |
|
13.45 |
|
4,721,834 |
|
60,649,968 |
|
3.32 |
% |
0.30 |
% |
1.85 |
% |
19.18 |
% |
21.04 |
% | |||
2018 |
|
10.25 |
|
11.12 |
|
2,089,209 |
|
22,306,050 |
|
0.99 |
% |
0.30 |
% |
1.95 |
% |
(6.70 |
)% |
(5.23 |
)% | |||
2017 |
|
10.95 |
|
11.75 |
|
1,924,941 |
|
21,856,855 |
|
2.08 |
% |
0.30 |
% |
1.95 |
% |
12.90 |
% |
14.65 |
% | |||
2016 |
|
9.83 |
|
10.25 |
|
1,626,322 |
|
16,252,668 |
|
2.28 |
% |
0.40 |
% |
1.95 |
% |
4.44 |
% |
6.07 |
% | |||
BlackRock Capital Appreciation V.I. Class III |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
2020 |
|
$ |
33.90 |
|
$ |
46.14 |
|
1,006,731 |
|
$ |
41,083,886 |
|
0.00 |
% |
0.75 |
% |
1.50 |
% |
39.41 |
% |
40.46 |
% |
2019 |
|
24.32 |
|
32.85 |
|
1,292,645 |
|
37,523,740 |
|
0.00 |
% |
0.75 |
% |
1.50 |
% |
29.59 |
% |
30.57 |
% | |||
2018 |
|
18.76 |
|
25.16 |
|
1,475,578 |
|
32,796,365 |
|
0.00 |
% |
0.75 |
% |
1.50 |
% |
0.60 |
% |
1.36 |
% | |||
2017 |
|
18.65 |
|
24.82 |
|
1,718,685 |
|
37,766,994 |
|
0.00 |
% |
0.75 |
% |
1.50 |
% |
30.97 |
% |
31.96 |
% | |||
2016 |
|
14.24 |
|
18.81 |
|
2,061,670 |
|
34,362,089 |
|
0.00 |
% |
0.75 |
% |
1.50 |
% |
(1.62 |
)% |
(0.88 |
)% | |||
BlackRock Global Allocation V.I. Class III |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
2020 |
|
$ |
13.51 |
|
$ |
19.09 |
|
98,050,229 |
|
$ |
1,608,721,024 |
|
1.26 |
% |
0.30 |
% |
2.00 |
% |
18.32 |
% |
20.35 |
% |
2019 |
|
11.36 |
|
15.88 |
|
111,381,280 |
|
1,537,219,217 |
|
1.20 |
% |
0.30 |
% |
2.00 |
% |
15.42 |
% |
17.40 |
% | |||
2018 |
|
9.79 |
|
13.54 |
|
132,460,071 |
|
1,575,516,857 |
|
0.81 |
% |
0.30 |
% |
2.00 |
% |
(9.42 |
)% |
(7.86 |
)% | |||
2017 |
|
10.75 |
|
14.76 |
|
151,755,086 |
|
1,985,390,161 |
|
1.25 |
% |
0.30 |
% |
2.00 |
% |
11.46 |
% |
13.26 |
% | |||
2016 |
|
10.59 |
|
13.08 |
|
169,103,542 |
|
1,975,008,715 |
|
1.18 |
% |
0.40 |
% |
2.00 |
% |
1.76 |
% |
3.39 |
% | |||
Fidelity VIP Contrafund Service Class 2 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
2020 |
|
$ |
17.09 |
|
$ |
28.96 |
|
11,335,278 |
|
$ |
293,430,933 |
|
0.08 |
% |
0.30 |
% |
2.00 |
% |
27.66 |
% |
29.84 |
% |
2019 |
|
13.32 |
|
22.33 |
|
11,865,835 |
|
239,600,500 |
|
0.22 |
% |
0.30 |
% |
2.00 |
% |
28.68 |
% |
30.88 |
% | |||
2018 |
|
10.30 |
|
17.08 |
|
11,658,277 |
|
181,793,911 |
|
0.44 |
% |
0.30 |
% |
2.00 |
% |
(8.50 |
)% |
(6.92 |
)% | |||
2017 |
|
11.22 |
|
18.36 |
|
10,873,948 |
|
184,452,029 |
|
0.81 |
% |
0.30 |
% |
2.00 |
% |
19.19 |
% |
21.10 |
% | |||
2016 |
|
13.64 |
|
15.16 |
|
9,087,111 |
|
129,225,919 |
|
0.67 |
% |
0.40 |
% |
2.00 |
% |
5.60 |
% |
7.30 |
% | |||
Fidelity VIP FundsManager 60% Service Class 2 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
2020 |
|
$ |
13.69 |
|
$ |
19.65 |
|
21,137,865 |
|
$ |
364,926,775 |
|
0.93 |
% |
0.30 |
% |
2.00 |
% |
12.64 |
% |
14.58 |
% |
2019 |
|
12.07 |
|
17.16 |
|
20,252,337 |
|
309,354,003 |
|
1.40 |
% |
0.30 |
% |
2.00 |
% |
17.87 |
% |
19.89 |
% | |||
2018 |
|
10.16 |
|
14.33 |
|
20,000,705 |
|
258,479,033 |
|
1.15 |
% |
0.30 |
% |
2.00 |
% |
(8.37 |
)% |
(6.79 |
)% | |||
2017 |
|
11.02 |
|
15.39 |
|
17,709,234 |
|
249,388,114 |
|
1.02 |
% |
0.30 |
% |
2.00 |
% |
14.46 |
% |
16.30 |
% | |||
2016 |
|
11.48 |
|
13.23 |
|
16,165,663 |
|
198,335,661 |
|
1.13 |
% |
0.40 |
% |
2.00 |
% |
2.58 |
% |
4.23 |
% | |||
Fidelity VIP Government Money Market Service Class |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
2020 |
|
$ |
9.15 |
|
$ |
10.31 |
|
50,158,206 |
|
$ |
482,675,916 |
|
0.22 |
% |
0.30 |
% |
2.00 |
% |
(1.71 |
)% |
(0.02 |
)% |
2019 |
|
9.30 |
|
10.32 |
|
32,145,243 |
|
312,107,403 |
|
1.88 |
% |
0.30 |
% |
2.00 |
% |
(0.10 |
)% |
1.61 |
% | |||
2018 |
|
9.31 |
|
10.15 |
|
31,093,930 |
|
298,387,548 |
|
1.55 |
% |
0.30 |
% |
2.00 |
% |
(0.47 |
)% |
1.25 |
% | |||
2017 |
|
9.36 |
|
10.03 |
|
24,835,099 |
|
237,510,491 |
|
0.56 |
% |
0.30 |
% |
2.00 |
% |
(1.41 |
)% |
0.17 |
% | |||
2016 |
|
9.49 |
|
9.91 |
|
29,223,322 |
|
281,583,163 |
|
0.10 |
% |
0.40 |
% |
2.00 |
% |
(1.87 |
)% |
(0.29 |
)% | |||
Fidelity VIP Strategic Income Service Class 2 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
2020 |
|
$ |
11.52 |
|
$ |
13.17 |
|
7,026,620 |
|
$ |
87,077,019 |
|
3.25 |
% |
0.30 |
% |
2.00 |
% |
5.04 |
% |
6.84 |
% |
2019 |
|
10.89 |
|
12.34 |
|
6,770,188 |
|
79,193,872 |
|
3.51 |
% |
0.30 |
% |
2.00 |
% |
8.46 |
% |
10.32 |
% | |||
2018 |
|
9.97 |
|
11.20 |
|
5,371,527 |
|
57,472,420 |
|
3.77 |
% |
0.30 |
% |
2.00 |
% |
(4.76 |
)% |
(3.12 |
)% | |||
2017 |
|
10.81 |
|
11.57 |
|
4,681,197 |
|
52,169,536 |
|
3.40 |
% |
0.30 |
% |
2.00 |
% |
5.42 |
% |
7.12 |
% | |||
2016 |
|
10.27 |
|
10.80 |
|
3,503,843 |
|
36,818,740 |
|
3.94 |
% |
0.40 |
% |
2.00 |
% |
5.88 |
% |
7.59 |
% |
See Notes to Financial Statements |
See explanation of references on pages SA-46 and SA-47 |
SEPARATE ACCOUNT A
FINANCIAL HIGHLIGHTS (Continued)
|
|
At the End of Each Year |
|
Investment |
|
|
|
|
|
|
|
|
| |||||||||
Variable Accounts |
|
AUV (1) |
|
Units |
|
Net |
|
Income |
|
Expense Ratios (3) |
|
Total Returns (4) |
| |||||||||
For Each Year |
|
Lowest |
|
Highest |
|
Outstanding |
|
Assets |
|
Ratios (2) |
|
Lowest |
|
Highest |
|
Lowest |
|
Highest |
| |||
First Trust Dorsey Wright Tactical Core Class I |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
2020 |
|
$ |
13.09 |
|
$ |
14.61 |
|
2,656,872 |
|
$ |
36,362,021 |
|
0.48 |
% |
0.30 |
% |
2.00 |
% |
8.89 |
% |
10.76 |
% |
2019 |
|
11.99 |
|
13.19 |
|
2,969,833 |
|
37,027,305 |
|
0.63 |
% |
0.30 |
% |
2.00 |
% |
18.59 |
% |
20.63 |
% | |||
2018 |
|
10.08 |
|
10.94 |
|
2,604,023 |
|
27,160,582 |
|
0.40 |
% |
0.30 |
% |
2.00 |
% |
(9.78 |
)% |
(8.36 |
)% | |||
2017 |
|
11.33 |
|
11.93 |
|
1,308,313 |
|
15,024,297 |
|
0.61 |
% |
0.30 |
% |
1.85 |
% |
15.34 |
% |
17.02 |
% | |||
2016 |
|
9.82 |
|
9.99 |
|
789,291 |
|
7,805,815 |
|
0.91 |
% |
0.40 |
% |
1.85 |
% |
(0.89 |
)% |
(0.25 |
)% | |||
First Trust Multi Income Allocation Class I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
2020 |
|
$ |
11.05 |
|
$ |
13.02 |
|
1,416,254 |
|
$ |
17,366,681 |
|
2.22 |
% |
0.30 |
% |
1.85 |
% |
0.61 |
% |
2.18 |
% |
2019 |
|
10.97 |
|
12.75 |
|
1,339,559 |
|
16,214,326 |
|
2.48 |
% |
0.30 |
% |
1.85 |
% |
14.25 |
% |
16.03 |
% | |||
2018 |
|
9.59 |
|
11.00 |
|
1,249,607 |
|
13,161,907 |
|
2.50 |
% |
0.30 |
% |
1.85 |
% |
(6.20 |
)% |
(4.72 |
)% | |||
2017 |
|
10.81 |
|
11.56 |
|
823,556 |
|
9,199,902 |
|
2.57 |
% |
0.30 |
% |
1.85 |
% |
4.11 |
% |
5.63 |
% | |||
2016 |
|
10.53 |
|
10.94 |
|
858,691 |
|
9,168,353 |
|
2.45 |
% |
0.40 |
% |
1.85 |
% |
7.30 |
% |
8.86 |
% | |||
First Trust/Dow Jones Dividend & Income Allocation Class I |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
2020 |
|
$ |
12.81 |
|
$ |
19.65 |
|
38,413,073 |
|
$ |
662,991,395 |
|
1.49 |
% |
0.30 |
% |
2.00 |
% |
5.67 |
% |
7.48 |
% |
2019 |
|
12.09 |
|
18.30 |
|
39,723,807 |
|
647,137,550 |
|
1.59 |
% |
0.30 |
% |
2.00 |
% |
18.38 |
% |
20.41 |
% | |||
2018 |
|
10.19 |
|
15.22 |
|
38,964,983 |
|
535,422,561 |
|
1.55 |
% |
0.30 |
% |
2.00 |
% |
(6.81 |
)% |
(5.20 |
)% | |||
2017 |
|
10.92 |
|
16.07 |
|
37,643,369 |
|
554,645,989 |
|
1.31 |
% |
0.30 |
% |
2.00 |
% |
11.23 |
% |
13.14 |
% | |||
2016 |
|
10.14 |
|
14.21 |
|
34,772,950 |
|
461,050,789 |
|
1.17 |
% |
0.30 |
% |
2.00 |
% |
9.53 |
% |
11.29 |
% | |||
Franklin Allocation VIP Class 2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
17.72 |
|
$ |
20.80 |
|
1,319,963 |
|
$ |
25,870,236 |
|
1.49 |
% |
0.75 |
% |
1.50 |
% |
10.08 |
% |
10.91 |
% |
2019 |
|
16.10 |
|
18.75 |
|
1,342,099 |
|
23,727,646 |
|
3.55 |
% |
0.75 |
% |
1.50 |
% |
18.07 |
% |
18.96 |
% | |||
2018 |
|
13.63 |
|
15.76 |
|
1,325,154 |
|
19,722,357 |
|
3.06 |
% |
0.75 |
% |
1.50 |
% |
(11.00 |
)% |
(10.33 |
)% | |||
2017 |
|
15.32 |
|
17.58 |
|
1,302,134 |
|
21,631,845 |
|
2.67 |
% |
0.75 |
% |
1.50 |
% |
10.32 |
% |
11.14 |
% | |||
2016 |
|
13.89 |
|
15.82 |
|
1,254,104 |
|
18,775,367 |
|
3.88 |
% |
0.75 |
% |
1.50 |
% |
11.50 |
% |
12.34 |
% | |||
Franklin Allocation VIP Class 4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
13.59 |
|
$ |
19.06 |
|
16,724,233 |
|
$ |
269,024,656 |
|
1.34 |
% |
0.30 |
% |
2.00 |
% |
9.54 |
% |
11.42 |
% |
2019 |
|
12.22 |
|
17.33 |
|
18,217,777 |
|
266,689,325 |
|
3.32 |
% |
0.30 |
% |
2.00 |
% |
17.19 |
% |
19.20 |
% | |||
2018 |
|
10.27 |
|
14.73 |
|
20,456,672 |
|
254,733,392 |
|
2.87 |
% |
0.30 |
% |
2.00 |
% |
(11.38 |
)% |
(9.85 |
)% | |||
2017 |
|
11.42 |
|
16.55 |
|
24,332,103 |
|
340,451,293 |
|
2.54 |
% |
0.30 |
% |
2.00 |
% |
9.57 |
% |
11.33 |
% | |||
2016 |
|
11.54 |
|
15.05 |
|
26,702,663 |
|
339,747,629 |
|
3.72 |
% |
0.40 |
% |
2.00 |
% |
10.69 |
% |
12.47 |
% | |||
Franklin Income VIP Class 2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
11.29 |
|
$ |
12.45 |
|
4,573,894 |
|
$ |
53,969,144 |
|
6.00 |
% |
0.30 |
% |
2.00 |
% |
(1.30 |
)% |
0.39 |
% |
2019 |
|
11.44 |
|
12.40 |
|
4,714,785 |
|
55,900,700 |
|
5.31 |
% |
0.30 |
% |
2.00 |
% |
13.76 |
% |
15.71 |
% | |||
2018 |
|
10.05 |
|
10.72 |
|
3,727,163 |
|
38,547,708 |
|
4.81 |
% |
0.30 |
% |
2.00 |
% |
(6.21 |
)% |
(4.59 |
)% | |||
2017 |
|
10.72 |
|
11.23 |
|
3,458,251 |
|
37,822,646 |
|
4.19 |
% |
0.30 |
% |
2.00 |
% |
7.51 |
% |
9.34 |
% | |||
2016 |
|
9.97 |
|
10.27 |
|
2,092,953 |
|
21,111,682 |
|
4.67 |
% |
0.30 |
% |
2.00 |
% |
11.94 |
% |
13.57 |
% | |||
Franklin Mutual Global Discovery VIP Class 2 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
2020 |
|
$ |
11.56 |
|
$ |
19.30 |
|
11,609,935 |
|
$ |
188,576,655 |
|
2.41 |
% |
0.30 |
% |
2.00 |
% |
(6.36 |
)% |
(4.75 |
)% |
2019 |
|
12.16 |
|
20.35 |
|
12,150,356 |
|
206,820,911 |
|
1.61 |
% |
0.30 |
% |
2.00 |
% |
21.91 |
% |
24.00 |
% | |||
2018 |
|
9.83 |
|
16.49 |
|
13,449,622 |
|
186,078,604 |
|
2.35 |
% |
0.30 |
% |
2.00 |
% |
(12.99 |
)% |
(11.48 |
)% | |||
2017 |
|
11.12 |
|
18.71 |
|
14,006,116 |
|
220,413,458 |
|
1.78 |
% |
0.30 |
% |
2.00 |
% |
6.45 |
% |
8.27 |
% | |||
2016 |
|
10.30 |
|
17.36 |
|
13,999,486 |
|
206,289,451 |
|
1.70 |
% |
0.30 |
% |
2.00 |
% |
9.96 |
% |
11.73 |
% | |||
Franklin Rising Dividends VIP Class 2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
2020 |
|
$ |
15.52 |
|
$ |
25.63 |
|
9,362,137 |
|
$ |
212,785,729 |
|
1.24 |
% |
0.30 |
% |
2.00 |
% |
13.67 |
% |
15.62 |
% |
2019 |
|
13.58 |
|
22.19 |
|
10,256,753 |
|
203,835,964 |
|
1.23 |
% |
0.30 |
% |
2.00 |
% |
26.67 |
% |
28.84 |
% | |||
2018 |
|
10.67 |
|
17.24 |
|
9,931,707 |
|
154,894,538 |
|
1.26 |
% |
0.30 |
% |
2.00 |
% |
(6.97 |
)% |
(5.36 |
)% | |||
2017 |
|
12.10 |
|
18.23 |
|
10,043,010 |
|
167,633,877 |
|
1.51 |
% |
0.30 |
% |
2.00 |
% |
18.18 |
% |
20.20 |
% | |||
2016 |
|
10.09 |
|
15.19 |
|
10,003,909 |
|
140,746,663 |
|
1.39 |
% |
0.30 |
% |
2.00 |
% |
13.75 |
% |
15.58 |
% | |||
Templeton Global Bond VIP Class 2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
2020 |
|
$ |
8.63 |
|
$ |
11.92 |
|
8,259,570 |
|
$ |
77,421,248 |
|
8.30 |
% |
0.30 |
% |
2.00 |
% |
(7.16 |
)% |
(5.56 |
)% |
2019 |
|
9.28 |
|
12.67 |
|
9,186,153 |
|
91,721,794 |
|
7.09 |
% |
0.30 |
% |
2.00 |
% |
(0.01 |
)% |
1.71 |
% | |||
2018 |
|
9.26 |
|
12.52 |
|
9,627,263 |
|
95,140,630 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(0.09 |
)% |
1.63 |
% | |||
2017 |
|
9.25 |
|
12.37 |
|
9,560,513 |
|
93,539,600 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(0.09 |
)% |
1.62 |
% | |||
2016 |
|
9.24 |
|
12.23 |
|
8,882,675 |
|
86,217,009 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
0.91 |
% |
2.53 |
% | |||
Ivy VIP Asset Strategy Class II |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
11.87 |
|
$ |
15.51 |
|
1,158,794 |
|
$ |
14,484,570 |
|
1.94 |
% |
0.30 |
% |
2.00 |
% |
11.62 |
% |
13.54 |
% |
2019 |
|
10.63 |
|
13.66 |
|
1,352,169 |
|
15,018,915 |
|
2.08 |
% |
0.30 |
% |
2.00 |
% |
19.37 |
% |
21.41 |
% | |||
2018 |
|
8.91 |
|
11.25 |
|
1,483,636 |
|
13,696,205 |
|
1.83 |
% |
0.30 |
% |
2.00 |
% |
(7.32 |
)% |
(5.72 |
)% | |||
2017 |
|
9.61 |
|
11.93 |
|
1,570,854 |
|
15,529,480 |
|
1.54 |
% |
0.30 |
% |
2.00 |
% |
15.94 |
% |
17.80 |
% | |||
2016 |
|
8.29 |
|
8.65 |
|
1,823,068 |
|
15,402,009 |
|
0.57 |
% |
0.40 |
% |
2.00 |
% |
(4.49 |
)% |
(2.96 |
)% |
See Notes to Financial Statements |
See explanation of references on pages SA-46 and SA-47 |
SEPARATE ACCOUNT A
FINANCIAL HIGHLIGHTS (Continued)
|
|
At the End of Each Year |
|
Investment |
|
|
|
|
|
|
|
|
| |||||||||
Variable Accounts |
|
AUV (1) |
|
Units |
|
Net |
|
Income |
|
Expense Ratios (3) |
|
Total Returns (4) |
| |||||||||
For Each Year |
|
Lowest |
|
Highest |
|
Outstanding |
|
Assets |
|
Ratios (2) |
|
Lowest |
|
Highest |
|
Lowest |
|
Highest |
| |||
Ivy VIP Energy Class II |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
3.18 |
|
$ |
3.87 |
|
5,774,234 |
|
$ |
19,132,655 |
|
2.22 |
% |
0.30 |
% |
2.00 |
% |
(38.09 |
)% |
(37.02 |
)% |
2019 |
|
5.13 |
|
5.78 |
|
2,985,245 |
|
15,845,384 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
1.43 |
% |
3.17 |
% | |||
2018 |
|
5.06 |
|
5.61 |
|
2,874,689 |
|
14,926,807 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(35.45 |
)% |
(34.34 |
)% | |||
2017 |
|
7.84 |
|
8.54 |
|
2,560,099 |
|
20,441,453 |
|
0.74 |
% |
0.30 |
% |
2.00 |
% |
(14.37 |
)% |
(12.90 |
)% | |||
2016 |
|
9.16 |
|
9.80 |
|
2,795,729 |
|
25,853,628 |
|
0.13 |
% |
0.30 |
% |
2.00 |
% |
31.89 |
% |
34.02 |
% | |||
Janus Henderson Balanced Service Shares |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
2020 |
|
$ |
14.95 |
|
$ |
21.48 |
|
221,575,730 |
|
$ |
4,242,264,305 |
|
1.56 |
% |
0.30 |
% |
2.00 |
% |
11.77 |
% |
13.69 |
% |
2019 |
|
13.30 |
|
18.92 |
|
185,974,655 |
|
3,171,059,795 |
|
1.71 |
% |
0.30 |
% |
2.00 |
% |
19.85 |
% |
21.91 |
% | |||
2018 |
|
11.05 |
|
15.53 |
|
151,998,954 |
|
2,154,003,803 |
|
1.79 |
% |
0.30 |
% |
2.00 |
% |
(1.57 |
)% |
0.13 |
% | |||
2017 |
|
11.17 |
|
15.53 |
|
123,407,941 |
|
1,770,974,243 |
|
1.44 |
% |
0.30 |
% |
2.00 |
% |
15.80 |
% |
17.78 |
% | |||
2016 |
|
10.11 |
|
13.20 |
|
107,014,619 |
|
1,322,530,489 |
|
2.00 |
% |
0.30 |
% |
2.00 |
% |
2.26 |
% |
3.91 |
% | |||
Janus Henderson Flexible Bond Service Shares |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
2020 |
|
$ |
11.18 |
|
$ |
12.44 |
|
3,367,311 |
|
$ |
39,512,445 |
|
2.49 |
% |
0.30 |
% |
2.00 |
% |
8.07 |
% |
9.92 |
% |
2019 |
|
10.35 |
|
11.33 |
|
2,797,058 |
|
30,110,415 |
|
2.86 |
% |
0.30 |
% |
2.00 |
% |
7.11 |
% |
8.95 |
% | |||
2018 |
|
9.66 |
|
10.41 |
|
2,570,835 |
|
25,650,617 |
|
2.64 |
% |
0.30 |
% |
2.00 |
% |
(3.25 |
)% |
(1.58 |
)% | |||
2017 |
|
9.98 |
|
10.59 |
|
2,770,207 |
|
28,344,424 |
|
2.55 |
% |
0.30 |
% |
2.00 |
% |
1.31 |
% |
2.94 |
% | |||
2016 |
|
9.85 |
|
10.28 |
|
2,601,100 |
|
26,083,540 |
|
2.44 |
% |
0.40 |
% |
2.00 |
% |
0.25 |
% |
1.81 |
% | |||
JPMorgan Insurance Trust Core Bond Class 1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
2020 |
|
$ |
16.17 |
|
$ |
16.72 |
|
10,472 |
|
$ |
174,914 |
|
2.05 |
% |
1.40 |
% |
1.60 |
% |
6.13 |
% |
6.35 |
% |
2019 |
|
15.24 |
|
15.72 |
|
11,823 |
|
185,713 |
|
2.50 |
% |
1.40 |
% |
1.60 |
% |
6.46 |
% |
6.67 |
% | |||
2018 |
|
14.31 |
|
14.74 |
|
11,899 |
|
175,221 |
|
2.46 |
% |
1.40 |
% |
1.60 |
% |
(1.55 |
)% |
(1.35 |
)% | |||
2017 |
|
14.54 |
|
14.94 |
|
25,121 |
|
375,134 |
|
2.52 |
% |
1.40 |
% |
1.60 |
% |
1.93 |
% |
2.14 |
% | |||
2016 |
|
14.26 |
|
14.63 |
|
29,216 |
|
427,188 |
|
2.72 |
% |
1.40 |
% |
1.60 |
% |
0.50 |
% |
0.70 |
% | |||
JPMorgan Insurance Trust Global Allocation Class 2 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
2020 |
|
$ |
13.32 |
|
$ |
14.81 |
|
941,553 |
|
$ |
13,072,807 |
|
1.69 |
% |
0.30 |
% |
1.85 |
% |
13.28 |
% |
15.05 |
% |
2019 |
|
11.75 |
|
12.87 |
|
980,418 |
|
11,941,301 |
|
2.06 |
% |
0.30 |
% |
2.00 |
% |
14.44 |
% |
16.23 |
% | |||
2018 |
|
10.21 |
|
11.08 |
|
993,900 |
|
10,545,527 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(8.18 |
)% |
(6.59 |
)% | |||
2017 |
|
11.12 |
|
11.86 |
|
754,917 |
|
8,639,406 |
|
1.62 |
% |
0.30 |
% |
2.00 |
% |
14.54 |
% |
16.38 |
% | |||
2016 |
|
9.71 |
|
9.97 |
|
426,423 |
|
4,191,901 |
|
3.38 |
% |
0.40 |
% |
2.00 |
% |
3.75 |
% |
5.41 |
% | |||
JPMorgan Insurance Trust Income Builder Class 2 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
2020 |
|
$ |
11.63 |
|
$ |
12.86 |
|
1,169,287 |
|
$ |
14,215,565 |
|
3.29 |
% |
0.30 |
% |
2.00 |
% |
3.13 |
% |
4.90 |
% |
2019 |
|
11.27 |
|
12.26 |
|
1,080,178 |
|
12,639,900 |
|
3.07 |
% |
0.30 |
% |
2.00 |
% |
12.01 |
% |
13.93 |
% | |||
2018 |
|
10.06 |
|
10.76 |
|
874,702 |
|
9,065,181 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(6.81 |
)% |
(5.20 |
)% | |||
2017 |
|
10.80 |
|
11.35 |
|
760,276 |
|
8,380,795 |
|
3.58 |
% |
0.30 |
% |
2.00 |
% |
9.50 |
% |
11.26 |
% | |||
2016 |
|
9.86 |
|
10.13 |
|
648,065 |
|
6,463,331 |
|
4.14 |
% |
0.40 |
% |
2.00 |
% |
4.10 |
% |
5.78 |
% | |||
JPMorgan Insurance Trust Mid Cap Value Class 1 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
2020 |
|
$ |
29.95 |
|
$ |
30.96 |
|
3,139 |
|
$ |
96,543 |
|
1.45 |
% |
1.40 |
% |
1.60 |
% |
(1.22 |
)% |
(1.03 |
)% |
2019 |
|
30.32 |
|
31.28 |
|
3,229 |
|
100,340 |
|
1.61 |
% |
1.40 |
% |
1.60 |
% |
24.75 |
% |
25.00 |
% | |||
2018 |
|
24.31 |
|
25.03 |
|
3,373 |
|
83,917 |
|
0.97 |
% |
1.40 |
% |
1.60 |
% |
(13.24 |
)% |
(13.07 |
)% | |||
2017 |
|
28.02 |
|
28.79 |
|
3,381 |
|
96,807 |
|
0.79 |
% |
1.40 |
% |
1.60 |
% |
11.96 |
% |
12.19 |
% | |||
2016 |
|
25.02 |
|
25.66 |
|
3,813 |
|
97,391 |
|
0.86 |
% |
1.40 |
% |
1.60 |
% |
12.88 |
% |
13.11 |
% | |||
JPMorgan Insurance Trust U.S. Equity Class 1 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
2020 |
|
$ |
42.12 |
|
$ |
42.12 |
|
561 |
|
$ |
23,635 |
|
0.76 |
% |
1.40 |
% |
1.40 |
% |
23.52 |
% |
23.52 |
% |
2019 |
|
34.10 |
|
34.10 |
|
584 |
|
19,926 |
|
0.85 |
% |
1.40 |
% |
1.40 |
% |
29.92 |
% |
29.92 |
% | |||
2018 |
|
26.25 |
|
26.25 |
|
588 |
|
15,447 |
|
0.62 |
% |
1.40 |
% |
1.40 |
% |
(7.48 |
)% |
(7.48 |
)% | |||
2017 |
|
28.37 |
|
28.37 |
|
2,329 |
|
66,081 |
|
0.88 |
% |
1.40 |
% |
1.40 |
% |
20.63 |
% |
20.63 |
% | |||
2016 |
|
23.52 |
|
23.52 |
|
2,353 |
|
55,336 |
|
0.99 |
% |
1.40 |
% |
1.40 |
% |
9.40 |
% |
9.40 |
% | |||
ClearBridge Variable Aggressive Growth - Class II |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
2020 |
|
$ |
13.74 |
|
$ |
15.50 |
|
980,629 |
|
$ |
14,337,024 |
|
0.66 |
% |
0.30 |
% |
2.00 |
% |
15.40 |
% |
17.38 |
% |
2019 |
|
11.82 |
|
13.21 |
|
877,736 |
|
11,023,937 |
|
0.85 |
% |
0.30 |
% |
2.00 |
% |
22.34 |
% |
24.37 |
% | |||
2018 |
|
9.60 |
|
10.62 |
|
678,630 |
|
6,923,122 |
|
0.41 |
% |
0.30 |
% |
2.00 |
% |
(10.34 |
)% |
(8.84 |
)% | |||
2017 |
|
11.08 |
|
11.65 |
|
583,639 |
|
6,588,820 |
|
0.30 |
% |
0.30 |
% |
2.00 |
% |
13.70 |
% |
15.52 |
% | |||
2016 |
|
9.74 |
|
9.93 |
|
375,796 |
|
3,692,453 |
|
0.70 |
% |
0.40 |
% |
2.00 |
% |
(0.71 |
)% |
0.53 |
% | |||
Lord Abbett Bond Debenture Class VC |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
2020 |
|
$ |
11.74 |
|
$ |
15.33 |
|
9,342,834 |
|
$ |
131,580,408 |
|
3.97 |
% |
0.30 |
% |
2.00 |
% |
5.18 |
% |
6.98 |
% |
2019 |
|
11.11 |
|
14.34 |
|
9,128,556 |
|
121,162,936 |
|
4.31 |
% |
0.30 |
% |
2.00 |
% |
11.11 |
% |
13.01 |
% | |||
2018 |
|
9.94 |
|
12.70 |
|
7,732,403 |
|
91,539,827 |
|
4.49 |
% |
0.30 |
% |
2.00 |
% |
(5.93 |
)% |
(4.31 |
)% | |||
2017 |
|
11.03 |
|
13.29 |
|
7,119,649 |
|
88,873,085 |
|
4.58 |
% |
0.30 |
% |
2.00 |
% |
7.06 |
% |
8.78 |
% | |||
2016 |
|
11.12 |
|
12.22 |
|
5,866,815 |
|
68,036,796 |
|
5.03 |
% |
0.40 |
% |
2.00 |
% |
9.92 |
% |
11.69 |
% |
See Notes to Financial Statements |
See explanation of references on pages SA-46 and SA-47 |
SEPARATE ACCOUNT A
FINANCIAL HIGHLIGHTS (Continued)
|
|
At the End of Each Year or Period |
|
Investment |
|
|
|
|
|
|
|
|
| |||||||||
Variable Accounts |
|
AUV (1) |
|
Units |
|
Net |
|
Income |
|
Expense Ratios (3) |
|
Total Returns (4) |
| |||||||||
For Each Year or Period |
|
Lowest |
|
Highest |
|
Outstanding |
|
Assets |
|
Ratios (2) |
|
Lowest |
|
Highest |
|
Lowest |
|
Highest |
| |||
Lord Abbett Total Return Class VC |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
2020 |
|
$ |
11.13 |
|
$ |
14.51 |
|
23,597,269 |
|
$ |
303,123,564 |
|
2.38 |
% |
0.30 |
% |
2.00 |
% |
5.30 |
% |
7.10 |
% |
2019 |
|
10.57 |
|
13.61 |
|
24,454,607 |
|
295,798,025 |
|
2.64 |
% |
0.30 |
% |
2.00 |
% |
6.26 |
% |
8.08 |
% | |||
2018 |
|
9.91 |
|
12.65 |
|
25,481,194 |
|
287,709,206 |
|
3.16 |
% |
0.30 |
% |
2.00 |
% |
(3.00 |
)% |
(1.32 |
)% | |||
2017 |
|
10.14 |
|
12.88 |
|
25,749,327 |
|
296,912,405 |
|
2.42 |
% |
0.30 |
% |
2.00 |
% |
1.81 |
% |
3.45 |
% | |||
2016 |
|
10.07 |
|
12.49 |
|
25,285,912 |
|
283,114,112 |
|
2.62 |
% |
0.40 |
% |
2.00 |
% |
2.20 |
% |
3.85 |
% | |||
MFS Massachusetts Investors Growth Stock - Service Class |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
2020 |
|
$ |
20.99 |
|
$ |
21.91 |
|
3,719,603 |
|
$ |
81,263,271 |
|
0.22 |
% |
0.75 |
% |
1.50 |
% |
20.38 |
% |
21.29 |
% |
2019 |
|
17.43 |
|
18.07 |
|
4,417,128 |
|
79,615,791 |
|
0.34 |
% |
0.75 |
% |
1.50 |
% |
37.51 |
% |
38.54 |
% | |||
2018 |
|
12.68 |
|
13.04 |
|
5,156,328 |
|
67,121,008 |
|
0.33 |
% |
0.75 |
% |
1.50 |
% |
(0.93 |
)% |
(0.18 |
)% | |||
2017 |
|
12.80 |
|
13.06 |
|
5,881,500 |
|
76,740,305 |
|
0.41 |
% |
0.75 |
% |
1.50 |
% |
26.20 |
% |
27.15 |
% | |||
2016 |
|
10.14 |
|
10.28 |
|
6,711,748 |
|
68,909,823 |
|
0.38 |
% |
0.75 |
% |
1.50 |
% |
4.27 |
% |
5.05 |
% | |||
MFS Total Return Series - Service Class |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
2020 |
|
$ |
12.70 |
|
$ |
19.80 |
|
25,334,270 |
|
$ |
439,107,285 |
|
2.09 |
% |
0.30 |
% |
2.00 |
% |
7.35 |
% |
9.19 |
% |
2019 |
|
11.77 |
|
18.21 |
|
26,668,585 |
|
428,357,165 |
|
2.13 |
% |
0.30 |
% |
2.00 |
% |
17.74 |
% |
19.76 |
% | |||
2018 |
|
9.95 |
|
15.28 |
|
27,386,021 |
|
372,281,332 |
|
1.96 |
% |
0.30 |
% |
2.00 |
% |
(7.75 |
)% |
(6.15 |
)% | |||
2017 |
|
10.73 |
|
16.36 |
|
29,971,293 |
|
440,019,701 |
|
2.19 |
% |
0.30 |
% |
2.00 |
% |
9.81 |
% |
11.69 |
% | |||
2016 |
|
10.12 |
|
14.84 |
|
27,639,529 |
|
369,435,455 |
|
2.81 |
% |
0.30 |
% |
2.00 |
% |
6.67 |
% |
8.38 |
% | |||
MFS Utilities Series - Service Class |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
2020 |
|
$ |
14.95 |
|
$ |
18.56 |
|
3,359,918 |
|
$ |
54,424,836 |
|
2.14 |
% |
0.30 |
% |
2.00 |
% |
3.53 |
% |
5.31 |
% |
2019 |
|
14.41 |
|
17.65 |
|
3,834,815 |
|
59,832,797 |
|
3.85 |
% |
0.30 |
% |
2.00 |
% |
22.33 |
% |
24.43 |
% | |||
2018 |
|
11.75 |
|
14.20 |
|
3,586,304 |
|
45,546,448 |
|
0.85 |
% |
0.30 |
% |
2.00 |
% |
(1.20 |
)% |
0.51 |
% | |||
2017 |
|
11.87 |
|
14.14 |
|
3,260,393 |
|
41,643,404 |
|
4.17 |
% |
0.30 |
% |
2.00 |
% |
12.23 |
% |
14.04 |
% | |||
2016 |
|
10.56 |
|
12.40 |
|
3,228,395 |
|
36,521,402 |
|
4.16 |
% |
0.40 |
% |
2.00 |
% |
9.04 |
% |
10.79 |
% | |||
MFS Value Series - Service Class |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
23.29 |
|
$ |
29.35 |
|
3,263,118 |
|
$ |
83,597,607 |
|
1.36 |
% |
0.75 |
% |
1.50 |
% |
1.68 |
% |
2.45 |
% |
2019 |
|
22.90 |
|
28.65 |
|
3,365,420 |
|
84,221,535 |
|
1.89 |
% |
0.75 |
% |
1.50 |
% |
27.58 |
% |
28.54 |
% | |||
2018 |
|
17.95 |
|
22.29 |
|
3,700,200 |
|
72,135,293 |
|
1.32 |
% |
0.75 |
% |
1.50 |
% |
(11.70 |
)% |
(11.03 |
)% | |||
2017 |
|
20.33 |
|
25.05 |
|
3,800,832 |
|
83,439,888 |
|
1.73 |
% |
0.75 |
% |
1.50 |
% |
15.61 |
% |
16.47 |
% | |||
2016 |
|
17.59 |
|
21.51 |
|
3,957,067 |
|
74,782,485 |
|
1.87 |
% |
0.75 |
% |
1.50 |
% |
12.09 |
% |
12.93 |
% | |||
Neuberger Berman U.S. Equity Index PutWrite Strategy Class S |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
2020 |
|
$ |
11.01 |
|
$ |
12.28 |
|
144,364 |
|
$ |
1,648,886 |
|
0.89 |
% |
0.30 |
% |
1.80 |
% |
6.33 |
% |
7.93 |
% |
2019 |
|
10.36 |
|
11.38 |
|
137,355 |
|
1,452,167 |
|
0.17 |
% |
0.30 |
% |
1.80 |
% |
13.20 |
% |
14.91 |
% | |||
2018 |
|
9.15 |
|
9.90 |
|
100,732 |
|
938,759 |
|
0.00 |
% |
0.30 |
% |
1.80 |
% |
(8.45 |
)% |
(7.16 |
)% | |||
2017 |
|
9.99 |
|
10.30 |
|
64,702 |
|
652,725 |
|
0.00 |
% |
0.40 |
% |
1.80 |
% |
4.84 |
% |
6.26 |
% | |||
2016 |
|
9.54 |
|
9.69 |
|
43,063 |
|
412,716 |
|
0.00 |
% |
0.40 |
% |
1.75 |
% |
(2.36 |
)% |
(1.73 |
)% | |||
PIMCO All Asset - Advisor Class (5) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
05/28/2020 - 12/31/2020 |
|
$ |
12.19 |
|
$ |
12.31 |
|
202,159 |
|
$ |
2,474,456 |
|
4.23 |
% |
0.40 |
% |
1.85 |
% |
17.17 |
% |
17.31 |
% |
PIMCO CommodityRealReturn Strategy - Advisor Class |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
2020 |
|
$ |
4.97 |
|
$ |
9.82 |
|
1,545,855 |
|
$ |
8,631,904 |
|
6.09 |
% |
0.30 |
% |
2.00 |
% |
(0.78 |
)% |
0.93 |
% |
2019 |
|
5.01 |
|
9.73 |
|
1,378,881 |
|
7,605,029 |
|
4.35 |
% |
0.30 |
% |
2.00 |
% |
9.15 |
% |
11.02 |
% | |||
2018 |
|
4.59 |
|
8.77 |
|
1,366,854 |
|
6,776,551 |
|
1.99 |
% |
0.30 |
% |
2.00 |
% |
(15.91 |
)% |
(14.46 |
)% | |||
2017 |
|
5.46 |
|
10.25 |
|
1,223,238 |
|
7,120,775 |
|
10.87 |
% |
0.30 |
% |
2.00 |
% |
0.03 |
% |
1.74 |
% | |||
2016 |
|
5.46 |
|
10.07 |
|
1,335,186 |
|
7,664,516 |
|
1.04 |
% |
0.30 |
% |
2.00 |
% |
12.77 |
% |
14.41 |
% | |||
PIMCO Income - Advisor Class (5) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
05/07/2020 - 12/31/2020 |
|
$ |
11.09 |
|
$ |
11.20 |
|
470,049 |
|
$ |
5,238,100 |
|
3.43 |
% |
0.30 |
% |
1.85 |
% |
11.14 |
% |
11.14 |
% |
Jennison Class II |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
52.76 |
|
$ |
54.83 |
|
2,253 |
|
$ |
122,083 |
|
0.00 |
% |
1.40 |
% |
1.60 |
% |
53.10 |
% |
53.41 |
% |
2019 |
|
34.46 |
|
35.74 |
|
2,267 |
|
80,093 |
|
0.00 |
% |
1.40 |
% |
1.60 |
% |
30.71 |
% |
30.98 |
% | |||
2018 |
|
26.36 |
|
27.29 |
|
2,270 |
|
61,280 |
|
0.00 |
% |
1.40 |
% |
1.75 |
% |
(2.76 |
)% |
(2.56 |
)% | |||
2017 |
|
26.45 |
|
28.01 |
|
6,326 |
|
170,351 |
|
0.00 |
% |
1.40 |
% |
1.75 |
% |
33.78 |
% |
34.25 |
% | |||
2016 |
|
19.77 |
|
20.86 |
|
17,740 |
|
354,124 |
|
0.00 |
% |
1.40 |
% |
1.75 |
% |
(3.00 |
)% |
(2.66 |
)% | |||
SP International Growth Class II |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
2020 |
|
$ |
26.47 |
|
$ |
28.39 |
|
2,402 |
|
$ |
65,593 |
|
0.00 |
% |
1.40 |
% |
1.75 |
% |
29.30 |
% |
29.75 |
% |
2019 |
|
20.47 |
|
21.88 |
|
2,538 |
|
53,491 |
|
0.00 |
% |
1.40 |
% |
1.75 |
% |
29.62 |
% |
30.07 |
% | |||
2018 |
|
15.79 |
|
16.82 |
|
2,732 |
|
44,330 |
|
0.00 |
% |
1.40 |
% |
1.75 |
% |
(14.72 |
)% |
(14.42 |
)% | |||
2017 |
|
18.52 |
|
19.65 |
|
3,029 |
|
57,516 |
|
0.00 |
% |
1.40 |
% |
1.75 |
% |
33.08 |
% |
33.54 |
% | |||
2016 |
|
13.92 |
|
14.72 |
|
14,385 |
|
202,331 |
|
0.00 |
% |
1.40 |
% |
1.75 |
% |
(5.82 |
)% |
(5.49 |
)% |
See Notes to Financial Statements |
See explanation of references on pages SA-46 and SA-47 |
SEPARATE ACCOUNT A
FINANCIAL HIGHLIGHTS (Continued)
|
|
At the End of Each Year or Period |
|
Investment |
|
|
|
|
|
|
|
|
| |||||||||
Variable Accounts |
|
AUV (1) |
|
Units |
|
Net |
|
Income |
|
Expense Ratios (3) |
|
Total Returns (4) |
| |||||||||
For Each Year or Period |
|
Lowest |
|
Highest |
|
Outstanding |
|
Assets |
|
Ratios (2) |
|
Lowest |
|
Highest |
|
Lowest |
|
Highest |
| |||
SP Prudential U.S. Emerging Growth Class II |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
2020 |
|
$ |
53.87 |
|
$ |
57.64 |
|
478 |
|
$ |
26,210 |
|
0.00 |
% |
1.40 |
% |
1.75 |
% |
44.35 |
% |
44.86 |
% |
2019 |
|
37.32 |
|
39.79 |
|
2,188 |
|
81,961 |
|
0.00 |
% |
1.40 |
% |
1.75 |
% |
34.78 |
% |
35.25 |
% | |||
2018 |
|
27.69 |
|
29.42 |
|
3,261 |
|
91,288 |
|
0.00 |
% |
1.40 |
% |
1.75 |
% |
(9.78 |
)% |
(9.46 |
)% | |||
2017 |
|
30.69 |
|
32.49 |
|
3,595 |
|
111,362 |
|
0.00 |
% |
1.40 |
% |
1.75 |
% |
19.83 |
% |
20.25 |
% | |||
2016 |
|
25.61 |
|
27.02 |
|
14,581 |
|
375,455 |
|
0.00 |
% |
1.40 |
% |
1.75 |
% |
2.02 |
% |
2.37 |
% | |||
Value Class II |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
23.96 |
|
$ |
25.64 |
|
3,391 |
|
$ |
84,936 |
|
0.00 |
% |
1.40 |
% |
1.75 |
% |
1.36 |
% |
1.71 |
% |
2019 |
|
23.64 |
|
25.21 |
|
3,503 |
|
86,339 |
|
0.00 |
% |
1.40 |
% |
1.75 |
% |
23.40 |
% |
23.83 |
% | |||
2018 |
|
19.16 |
|
20.35 |
|
5,417 |
|
107,427 |
|
0.00 |
% |
1.40 |
% |
1.75 |
% |
(11.80 |
)% |
(11.49 |
)% | |||
2017 |
|
21.72 |
|
23.00 |
|
5,785 |
|
129,739 |
|
0.00 |
% |
1.40 |
% |
1.75 |
% |
14.49 |
% |
14.89 |
% | |||
2016 |
|
18.97 |
|
20.02 |
|
7,086 |
|
139,067 |
|
0.00 |
% |
1.40 |
% |
1.75 |
% |
9.04 |
% |
9.42 |
% | |||
Schwab Government Money Market |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
2020 (6) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2019 (6) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
05/07/2018 - 09/06/2018 (6) |
|
$ |
9.86 |
|
$ |
9.86 |
|
— |
|
$ |
— |
|
1.56 |
% |
0.60 |
% |
0.60 |
% |
0.32 |
% |
0.32 |
% |
2017 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2016 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
Schwab VIT Balanced |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
12.74 |
|
$ |
14.60 |
|
4,960,747 |
|
$ |
72,154,553 |
|
1.87 |
% |
0.60 |
% |
1.00 |
% |
7.15 |
% |
7.58 |
% |
2019 |
|
11.89 |
|
13.57 |
|
4,795,185 |
|
64,871,472 |
|
1.74 |
% |
0.60 |
% |
1.00 |
% |
13.11 |
% |
13.56 |
% | |||
2018 |
|
10.51 |
|
11.95 |
|
4,934,852 |
|
58,844,444 |
|
1.33 |
% |
0.60 |
% |
1.00 |
% |
(5.59 |
)% |
(5.21 |
)% | |||
2017 |
|
11.13 |
|
12.61 |
|
4,673,447 |
|
58,777,056 |
|
1.19 |
% |
0.60 |
% |
1.00 |
% |
8.91 |
% |
9.35 |
% | |||
2016 |
|
10.22 |
|
11.53 |
|
4,573,038 |
|
52,603,578 |
|
1.06 |
% |
0.60 |
% |
1.00 |
% |
3.74 |
% |
4.15 |
% | |||
Schwab VIT Balanced with Growth |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
2020 |
|
$ |
13.74 |
|
$ |
16.47 |
|
9,090,166 |
|
$ |
147,549,098 |
|
2.05 |
% |
0.60 |
% |
1.00 |
% |
8.99 |
% |
9.43 |
% |
2019 |
|
12.61 |
|
15.05 |
|
9,832,786 |
|
145,983,472 |
|
1.86 |
% |
0.60 |
% |
1.00 |
% |
16.87 |
% |
17.34 |
% | |||
2018 |
|
10.79 |
|
12.83 |
|
10,008,190 |
|
126,869,239 |
|
1.54 |
% |
0.60 |
% |
1.00 |
% |
(7.64 |
)% |
(7.26 |
)% | |||
2017 |
|
11.68 |
|
13.83 |
|
10,035,039 |
|
137,192,784 |
|
1.38 |
% |
0.60 |
% |
1.00 |
% |
12.57 |
% |
13.02 |
% | |||
2016 |
|
10.38 |
|
12.24 |
|
10,156,593 |
|
122,988,482 |
|
1.29 |
% |
0.60 |
% |
1.00 |
% |
5.32 |
% |
5.74 |
% | |||
Schwab VIT Growth |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
2020 |
|
$ |
14.61 |
|
$ |
18.44 |
|
8,553,128 |
|
$ |
156,509,222 |
|
2.02 |
% |
0.60 |
% |
1.00 |
% |
10.23 |
% |
10.67 |
% |
2019 |
|
13.26 |
|
16.66 |
|
9,197,186 |
|
152,169,454 |
|
1.76 |
% |
0.60 |
% |
1.00 |
% |
19.64 |
% |
20.12 |
% | |||
2018 |
|
11.08 |
|
13.87 |
|
9,611,058 |
|
132,422,989 |
|
1.49 |
% |
0.60 |
% |
1.00 |
% |
(9.27 |
)% |
(8.91 |
)% | |||
2017 |
|
12.21 |
|
15.22 |
|
9,505,102 |
|
143,880,388 |
|
1.34 |
% |
0.60 |
% |
1.00 |
% |
15.98 |
% |
16.44 |
% | |||
2016 |
|
10.53 |
|
13.07 |
|
9,713,795 |
|
126,342,860 |
|
1.36 |
% |
0.60 |
% |
1.00 |
% |
6.60 |
% |
7.02 |
% | |||
State Street Total Return V.I.S. Class 3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
2020 |
|
$ |
11.97 |
|
$ |
23.92 |
|
21,256,530 |
|
$ |
383,179,392 |
|
1.62 |
% |
0.30 |
% |
2.00 |
% |
4.04 |
% |
5.82 |
% |
2019 |
|
11.44 |
|
22.63 |
|
23,459,047 |
|
406,020,577 |
|
2.02 |
% |
0.30 |
% |
2.00 |
% |
13.28 |
% |
15.22 |
% | |||
2018 |
|
10.05 |
|
19.66 |
|
26,335,073 |
|
404,148,979 |
|
1.86 |
% |
0.30 |
% |
2.00 |
% |
(8.47 |
)% |
(6.89 |
)% | |||
2017 |
|
10.93 |
|
21.13 |
|
28,254,998 |
|
478,275,225 |
|
1.73 |
% |
0.30 |
% |
2.00 |
% |
12.99 |
% |
14.92 |
% | |||
2016 |
|
10.16 |
|
18.41 |
|
30,770,276 |
|
465,604,170 |
|
1.58 |
% |
0.30 |
% |
2.00 |
% |
3.99 |
% |
5.66 |
% | |||
VanEck VIP Global Hard Assets Class S |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
2020 |
|
$ |
6.55 |
|
$ |
8.93 |
|
2,482,148 |
|
$ |
17,927,047 |
|
0.79 |
% |
0.30 |
% |
2.00 |
% |
16.47 |
% |
18.47 |
% |
2019 |
|
5.63 |
|
7.54 |
|
2,395,794 |
|
14,683,220 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
9.34 |
% |
11.21 |
% | |||
2018 |
|
5.15 |
|
6.78 |
|
2,121,470 |
|
11,751,306 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(29.85 |
)% |
(28.64 |
)% | |||
2017 |
|
7.34 |
|
9.50 |
|
2,200,630 |
|
17,210,080 |
|
0.00 |
% |
0.30 |
% |
2.00 |
% |
(3.91 |
)% |
(2.36 |
)% | |||
2016 |
|
7.63 |
|
8.40 |
|
2,635,249 |
|
21,129,905 |
|
0.28 |
% |
0.40 |
% |
2.00 |
% |
40.58 |
% |
42.84 |
% |
(1) The AUV is presented as a range from lowest to highest based on the ending AUV for all product groupings as of December 31 of each year or period ended. The lowest and highest AUV may be the same for a variable account if there is only one product which had investments at the end of the year or period.
(2) The investment income ratios represent the dividends, excluding distributions of capital gains, received by the variable accounts from the underlying portfolios/funds, divided by the average daily net assets (See Note 3 in Notes to Financial Statements). These ratios exclude those expenses, such as mortality and expense risk (“M&E”) fees, administrative fees, and additional death benefit rider charges, if any, that are assessed against contract owner accounts, either through reductions in the unit values or the redemption of units. The recognition of investment income by the variable accounts is affected by the timing of the declaration of dividends by the underlying portfolios/funds in which the variable accounts invest. The investment income ratios for periods of less than one full year are annualized.
(3) The expense ratios represent annualized contract fees and expenses of the Separate Account divided by the average daily net assets for each period indicated. These ratios include only those expenses that result in a direct reduction of unit values. Excluded are expenses of the underlying portfolios/funds in which the variable accounts invest and charges made directly to contract owner accounts through the redemption of units (See Note 4 in Notes to Financial Statements). The expense ratios are presented as a range of lowest to highest based on the product groupings. The expense ratios for periods of less than one full year are annualized.
See Notes to Financial Statements
SEPARATE ACCOUNT A
FINANCIAL HIGHLIGHTS (Continued)
(4) Total returns reflect changes in unit values of the underlying portfolios/funds and deductions for M&E fees, administrative fees, and additional death benefit rider charges, if any, assessed through the daily AUV calculation. These fees and charges are assessed at annual rates ranging from 0.30% to 2.00% based on the average daily net assets of each variable account as discussed in Note 4 in Notes to Financial Statements. Total returns do not include deductions at the separate account or contract level for any premium loads, maintenance fees, premium tax charges, withdrawal and surrender charges, charges for other optional benefit riders, or other charges that may be incurred under a contract which, if incurred, would have resulted in lower returns. Total returns are presented as a range from lowest to highest values based on the product grouping representing the minimum to maximum expense ratio amounts. Total returns for those contracts which commenced operations subsequent to the beginning of the year or period indicated for each variable account may not be within the ranges presented, and these contracts are excluded when calculating the total returns from lowest to highest as presented in the table. Total returns are calculated for each period indicated and are not annualized for periods of less than one full year.
(5) Operations commenced or resumed during 2020 (See Note 1 in Notes to Financial Statements).
(6) There has been no activity in the Schwab Government Money Market Variable Account since September 6, 2018.
See Notes to Financial Statements
SEPARATE ACCOUNT A
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION
The Separate Account A (the “Separate Account”) of Pacific Life Insurance Company (“Pacific Life”) is registered as a unit investment trust under the Investment Company Act of 1940, as amended. The Separate Account consists of subaccounts (each, a “Variable Account” and collectively, the “Variable Accounts”) which invest in shares of corresponding portfolios or funds (each, a “Portfolio” and collectively, the “Portfolios”) of registered investment management companies (each, a “Fund” and collectively, the “Funds”). As of December 31, 2020, the Fund investment options are Pacific Select Fund (See Note 4), AIM Variable Insurance Funds (Invesco Variable Insurance Funds), American Century Variable Portfolios, Inc., American Funds Insurance Series®, BlackRock Variable Series Funds, Inc., Fidelity Variable Insurance Products Funds, First Trust Variable Insurance Trust, Franklin Templeton Variable Insurance Products Trust, Ivy Variable Insurance Portfolios, Janus Aspen Series, JPMorgan Insurance Trust, Legg Mason Partners Variable Equity Trust, Lord Abbett Series Fund, Inc., MFS Variable Insurance Trust, Neuberger Berman Advisers Management Trust, PIMCO Variable Insurance Trust, Prudential Series Fund, Schwab Annuity Portfolios, State Street Variable Insurance Series Funds, Inc., and Van Eck VIP Trust. The Variable Accounts which have not commenced operations as of December 31, 2020 are not presented in this annual report.
Each of the Portfolios pursues different investment objectives and policies. The financial statements of the Funds, including the schedules of investments, are provided separately and should be read in conjunction with the Separate Account’s financial statements.
The Small-Cap Growth Class I, Value Class I, and American Funds IS Capital World Bond Class 4 Variable Accounts and Portfolios were formerly named Developing Growth Class I, Comstock Class I, and American Funds IS Global Bond Class 4 Variable Accounts and Portfolios, respectively.
The PIMCO All Asset - Advisor Class and PIMCO Income - Advisor Class Variable Accounts commenced or resumed operations on May 28, 2020 and May 7, 2020, respectively.
On April 30, 2020, the Inflation Strategy Class I and Currency Strategies Class I Variable Accounts were liquidated. On October 30, 2020, the International Equity Income Variable Account was liquidated. Any units that remained in each of these three Variable Accounts after the close of business on the liquidation dates were transferred to the Fidelity VIP Government Money Market Service Class Variable Account. Such transfers were based on the applicable Variable Accounts’ accumulation unit values and the relative net asset values of the respective Portfolios as of the close of the business of the liquidation dates. Because these three Variable Accounts were liquidated prior to December 31, 2020, no other information for these Variable Accounts are included in this annual report.
On June 1, 2020, the net assets of the PIMCO All Asset All Authority Portfolio (Advisor Class), the underlying Portfolio for the PIMCO All Asset All Authority - Advisor Class Variable Account, were transferred to the PIMCO All Asset Portfolio (Advisor Class), the underlying Portfolio for the PIMCO All Asset - Advisor Class Variable Account, through a reorganization. In connection with this reorganization, any units that remained in the PIMCO All Asset All Authority - Advisor Class Variable Account after the close of business on June 1, 2020 were transferred to the PIMCO All Asset - Advisor Class Variable Account. Such transfers were based on the applicable Variable Account accumulation unit values and the relative net asset values of the respective Portfolios, as of the close of business on June 1, 2020. The PIMCO All Asset All Authority - Advisor Class Variable Account is not included in this annual report.
On March 15, 2019, the net assets of the Pacific Select Fund’s Floating Rate Loan Portfolio Class I, the underlying Portfolio for the Floating Rate Loan Class I Variable Account, were transferred to the Pacific Select Fund Floating Rate Income Portfolio Class I, the underlying Portfolio for the Floating Rate Income Class I Variable Account through a reorganization (the “2019 Reorganization”). In connection with the 2019 Reorganization, any units that remained in the Floating Rate Loan Class I Variable Account after the close of business on March 15, 2019 were transferred to the Floating Rate Income Class I Variable Account. Such transfers were based on the applicable Variable Account accumulation unit values and the relative net asset values of the respective Portfolios, as of the close of business on March 15, 2019. The Floating Rate Loan Class I Variable Account is not included in this annual report.
On April 30, 2019, the Global Absolute Return Class I Variable Account was liquidated. On October 30, 2019, the Diversified Alternatives Class I and Equity Long/Short Class I Variable Accounts were liquidated. Any units that remained in each of these three Variable Accounts after the close of business on the liquidation dates were transferred to the Fidelity VIP Government Money Market Service Class Variable Account. Such transfers were based on the applicable Variable Accounts’ accumulation unit values and the relative net asset values of the respective Portfolios as of the close of the business of the liquidation dates. Because these three Variable Accounts were liquidated prior to December 31, 2019, no other information for these Variable Accounts are included in this annual report.
On April 30, 2019, the Lord Abbett International Equity Class VC Variable Account was liquidated. Because the Variable Account was liquidated prior to December 31, 2019, no other information for the Variable Account is presented in this annual report.
SEPARATE ACCOUNT A
NOTES TO FINANCIAL STATEMENTS (Continued)
Under applicable insurance law, the assets and liabilities of the Separate Account are clearly identified and distinguished from the other assets and liabilities of Pacific Life. The assets of the Separate Account will not be charged with any liabilities arising out of any other business conducted by Pacific Life, but the obligations of the Separate Account, including benefits related to variable annuity contracts, are obligations of Pacific Life.
The Separate Account funds individual flexible premium deferred variable annuity contracts (the “Contracts”). The investments of the Separate Account are carried at fair value.
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of the significant accounting policies followed by the Separate Account in the preparation of its financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”), which may require management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates. The Separate Account qualifies as an investment company under U.S. GAAP and follows the accounting and reporting guidance applicable to Investment Companies Topic of U.S. GAAP.
A. Valuation of Investments
Investments in shares of the Portfolios are valued at the reported net asset values of the respective Portfolios. Valuation of securities held by the Funds is discussed in the notes to their financial statements.
B. Security Transactions and Income
Transactions are recorded on the trade date. Realized gains and losses on sales of investments are determined on the basis of identified cost. Dividends and capital gains distributions, if any, from mutual fund investments are recorded on the ex-dividend date.
C. Federal Income Taxes
The operations of the Separate Account are included within the total operations of Pacific Life, which files income tax returns as part of the Pacific Mutual Holding Company consolidated federal income tax return. Under the current tax law, no federal income taxes are expected to be paid with respect to the operations of the Separate Account. Pacific Life will periodically review the status of this policy in the event of changes in the tax law.
D. Contracts in Payout Period
Net assets allocated to Contracts in payout period are computed, on a current basis, according to the Annuity 2000 Mortality Table or 2012 IAR Mortality Table depending on the year of annuitization. The assumed investment return is 4.0 or 5.0 percent depending on the product. The mortality risk is fully borne by Pacific Life and may result in additional amounts being transferred into the Variable Accounts by Pacific Life to cover greater longevity of annuitants than expected. Conversely, if amounts allocated exceed the amounts required, transfers may be made to Pacific Life. These transfers, if any, are shown as adjustments to net assets allocated to contracts in payout (annuitization) period in the accompanying Statements of Changes in Net Assets.
3. DIVIDENDS AND DISTRIBUTIONS FROM MUTUAL FUND INVESTMENTS
All dividend and capital gain distributions, if any, received from the Portfolios are reinvested in additional full and fractional shares of the related Portfolios and are recorded by the Variable Accounts on the ex-dividend date.
Each of the Portfolios in the Pacific Select Fund is treated as a partnership for federal income tax purposes only (the “Partnership Portfolios”). The Partnership Portfolios are not required to distribute taxable income and capital gains for federal income tax purposes. Therefore, no dividend or capital gain distributions were received from any Portfolios in the Pacific Select Fund nor were they recorded by the applicable Variable Accounts in the Statements of Operations for the year ended December 31, 2020.
4. CHARGES AND EXPENSES AND RELATED PARTY TRANSACTIONS
Pacific Life deducts from the Separate Account daily charges for mortality and expense risks (“M&E”) and administrative fees Pacific Life assumes, and additional death benefit rider charges, if applicable. Contracts funded by the Separate Account currently being sold or administered, along with their respective annual expense rates, are summarized in the following table. The mortality risk assumed by Pacific Life is the risk that the annuitant will live longer than predicted and will receive more annuity payments than anticipated. Pacific Life also assumes mortality risk in connection with any death benefit paid under the Contracts. The expense risk assumed is that expenses incurred in administering the Contracts and the Separate Account will exceed the amounts realized from fees and charges assessed against the Contracts. These charges are assessed daily at the following annual rates based on the average daily net assets of each Variable Account and result in a direct reduction in unit values. M&E fees and administrative fees are included in the Statements of Operations.
SEPARATE ACCOUNT A
NOTES TO FINANCIAL STATEMENTS (Continued)
|
|
Death Benefit Options |
|
|
| ||||
Pacific Choice Contracts (Without Stepped-Up |
|
Standard Death Benefit |
|
Standard Death Benefit |
|
Standard Death Benefit |
|
|
|
Death Benefit II Rider Charge) |
|
With 5 Year Option |
|
With 3 Year Option |
|
With 0 Year Option |
|
|
|
M&E Charge |
|
0.95 |
% |
1.25 |
% |
1.35 |
% |
|
|
Administrative Fee |
|
0.25 |
% |
0.25 |
% |
0.25 |
% |
|
|
Total Annual Expenses |
|
1.20 |
% |
1.50 |
% |
1.60 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Pacific Choice Contracts (With Stepped-Up |
|
|
|
|
|
|
|
|
|
Death Benefit II Rider Charge) |
|
|
|
|
|
|
|
|
|
M&E Charge |
|
0.95 |
% |
1.25 |
% |
1.35 |
% |
|
|
Administrative Fee |
|
0.25 |
% |
0.25 |
% |
0.25 |
% |
|
|
Death Benefit Rider Charge |
|
0.20 |
% |
0.20 |
% |
0.20 |
% |
|
|
Total Annual Expenses |
|
1.40 |
% |
1.70 |
% |
1.80 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
With Stepped-Up Death |
|
|
|
|
|
Pacific Destinations and |
|
|
|
Benefit Rider or Stepped-Up |
|
|
|
|
|
Pacific Destination O - Series Contracts |
|
Standard Death Benefit |
|
Death Benefit II Rider |
|
|
|
|
|
M&E Charge |
|
0.60 |
% |
0.60 |
% |
|
|
|
|
Administrative Fee |
|
0.15 |
% |
0.15 |
% |
|
|
|
|
Death Benefit Rider Charge |
|
None |
|
0.20 |
% |
|
|
|
|
Total Annual Expenses |
|
0.75 |
% |
0.95 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Without Stepped-Up Death |
|
|
|
|
|
With Stepped-Up Death |
|
|
|
Benefit Rider and Four Year |
|
With Stepped-Up Death |
|
With Four Year Withdrawal |
|
Benefit Rider and Four Year |
|
Pacific Journey Select Contracts |
|
Withdrawal Charge Option |
|
Benefit Rider Only |
|
Charge Option Only |
|
Withdrawal Charge Option |
|
M&E Charge |
|
0.95 |
% |
0.95 |
% |
0.95 |
% |
0.95 |
% |
Administrative Fee |
|
0.15 |
% |
0.15 |
% |
0.15 |
% |
0.15 |
% |
Death Benefit Rider Charge |
|
None |
|
0.20 |
% |
None |
|
0.20 |
% |
Four Year Withdrawal Charge |
|
None |
|
None |
|
0.35 |
% |
0.35 |
% |
Total Annual Expenses |
|
1.10 |
% |
1.30 |
% |
1.45 |
% |
1.65 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Without Stepped-Up Death |
|
|
|
|
|
With Stepped-Up Death |
|
|
|
Benefit Rider II and Four Year |
|
With Stepped-Up Death |
|
With Four Year Withdrawal |
|
Benefit Rider II and Four Year |
|
Pacific Navigator Contracts |
|
Withdrawal Charge Option |
|
Benefit Rider II Only |
|
Charge Option Only |
|
Withdrawal Charge Option |
|
M&E Charge |
|
1.05 |
% |
1.05 |
% |
1.05 |
% |
1.05 |
% |
Administrative Fee |
|
0.25 |
% |
0.25 |
% |
0.25 |
% |
0.25 |
% |
Death Benefit Rider Charge |
|
None |
|
0.20 |
% |
None |
|
0.20 |
% |
Four Year Withdrawal Charge |
|
None |
|
None |
|
0.45 |
% |
0.45 |
% |
Total Annual Expenses |
|
1.30 |
% |
1.50 |
% |
1.75 |
% |
1.95 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
With Stepped-Up |
|
|
|
|
|
Pacific Destinations B Contracts |
|
Standard Death Benefit |
|
Death Benefit Rider |
|
|
|
|
|
M&E Charge |
|
1.15 |
% |
1.15 |
% |
|
|
|
|
Administrative Fee |
|
0.15 |
% |
0.15 |
% |
|
|
|
|
Death Benefit Rider Charge |
|
None |
|
0.20 |
% |
|
|
|
|
Total Annual Expenses |
|
1.30 |
% |
1.50 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pacific Journey Contracts |
|
|
|
|
|
|
|
|
|
M&E Charge |
|
0.90 |
% |
0.90 |
% |
|
|
|
|
Administrative Fee |
|
0.15 |
% |
0.15 |
% |
|
|
|
|
Death Benefit Rider Charge |
|
None |
|
0.20 |
% |
|
|
|
|
Total Annual Expenses |
|
1.05 |
% |
1.25 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pacific Odyssey Contracts |
|
|
|
|
|
|
|
|
|
(issued on or after 12/1/2016) |
|
|
|
|
|
|
|
|
|
M&E Charge |
|
0.15 |
% |
0.15 |
% |
|
|
|
|
Administrative Fee |
|
0.15 |
% |
0.15 |
% |
|
|
|
|
Death Benefit Rider Charge |
|
None |
|
0.20 |
% |
|
|
|
|
Total Annual Expenses |
|
0.30 |
% |
0.50 |
% |
|
|
|
|
SEPARATE ACCOUNT A
NOTES TO FINANCIAL STATEMENTS (Continued)
|
|
Death Benefit Options |
|
|
| ||||
Pacific Odyssey Contracts |
|
|
|
With Stepped-Up |
|
With Premier |
|
|
|
(issued prior to 12/1/2016) |
|
Standard Death Benefit |
|
Death Benefit Rider |
|
Death Benefit Rider |
|
|
|
M&E Charge |
|
0.15 |
% |
0.15 |
% |
0.15 |
% |
|
|
Administrative Fee |
|
0.25 |
% |
0.25 |
% |
0.25 |
% |
|
|
Death Benefit Rider Charge |
|
None |
|
0.20 |
% |
0.35 |
% |
|
|
Total Annual Expenses |
|
0.40 |
% |
0.60 |
% |
0.75 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Pacific One and Pacific |
|
|
|
|
|
|
|
|
|
Portfolios Contracts |
|
|
|
|
|
|
|
|
|
M&E Charge |
|
1.25 |
% |
1.25 |
% |
|
|
|
|
Administrative Fee |
|
0.15 |
% |
0.15 |
% |
|
|
|
|
Death Benefit Rider Charge |
|
None |
|
0.20 |
% |
|
|
|
|
Total Annual Expenses |
|
1.40 |
% |
1.60 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pacific One Select (issued on or after 8/1/2006) |
|
|
|
|
|
|
|
|
|
and Pacific Value Edge Contracts |
|
|
|
|
|
|
|
|
|
M&E Charge |
|
1.50 |
% |
1.50 |
% |
|
|
|
|
Administrative Fee |
|
0.25 |
% |
0.25 |
% |
|
|
|
|
Death Benefit Rider Charge |
|
None |
|
0.20 |
% |
|
|
|
|
Total Annual Expenses |
|
1.75 |
% |
1.95 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pacific One Select (issued prior to 8/1/2006) |
|
|
|
|
|
|
|
|
|
and Pacific Innovations Select Contracts |
|
|
|
|
|
|
|
|
|
M&E Charge |
|
1.40 |
% |
1.40 |
% |
1.40 |
% |
|
|
Administrative Fee |
|
0.25 |
% |
0.25 |
% |
0.25 |
% |
|
|
Death Benefit Rider Charge |
|
None |
|
0.20 |
% |
0.35 |
% |
|
|
Total Annual Expenses |
|
1.65 |
% |
1.85 |
% |
2.00 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Pacific Value and Pacific Innovations Contracts |
|
|
|
|
|
|
|
|
|
M&E Charge |
|
1.25 |
% |
1.25 |
% |
1.25 |
% |
|
|
Administrative Fee |
|
0.15 |
% |
0.15 |
% |
0.15 |
% |
|
|
Death Benefit Rider Charge |
|
None |
|
0.20 |
% |
0.35 |
% |
|
|
Total Annual Expenses |
|
1.40 |
% |
1.60 |
% |
1.75 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Pacific Value Select Contracts |
|
|
|
|
|
|
|
|
|
M&E Charge |
|
1.45 |
% |
1.45 |
% |
|
|
|
|
Administrative Fee |
|
0.15 |
% |
0.15 |
% |
|
|
|
|
Death Benefit Rider Charge |
|
None |
|
0.20 |
% |
|
|
|
|
Total Annual Expenses |
|
1.60 |
% |
1.80 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pacific Voyages Contracts |
|
|
|
|
|
|
|
|
|
M&E Charge |
|
1.00 |
% |
1.00 |
% |
|
|
|
|
Administrative Fee |
|
0.15 |
% |
0.15 |
% |
|
|
|
|
Death Benefit Rider Charge |
|
None |
|
0.20 |
% |
|
|
|
|
Total Annual Expenses |
|
1.15 |
% |
1.35 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Schwab Retirement |
|
|
|
With Return of Purchase |
|
With Stepped-Up |
|
|
|
Income Variable Annuity Contracts |
|
Standard Death Benefit |
|
Payments Death Benefit Rider |
|
Death Benefit Rider |
|
|
|
M&E Charge |
|
0.35 |
% |
0.35 |
% |
0.35 |
% |
|
|
Administrative Fee |
|
0.25 |
% |
0.25 |
% |
0.25 |
% |
|
|
Death Benefit Rider Charge |
|
None |
|
0.20 |
% |
0.40 |
% |
|
|
Total Annual Expenses |
|
0.60 |
% |
0.80 |
% |
1.00 |
% |
|
|
SEPARATE ACCOUNT A
NOTES TO FINANCIAL STATEMENTS (Continued)
Under the Contracts, Pacific Life makes certain deductions from the net assets of each Variable Account through a redemption of units for maintenance fees, any other optional riders, any state premium taxes, and any withdrawal and surrender charges, and are shown as a decrease in net assets from contract owner transactions in the accompanying Statements of Changes in Net Assets. For certain Contracts, a surrender charge is imposed if the Contract is partially or fully surrendered within the specified surrender charge period and charges will vary depending on the individual Contract. Most Contracts offer optional benefits that can be added to the Contract by rider. The charges for riders can range depending on the individual Contract. These fees and charges are assessed directly to each Contract owner account through redemption of units. Withdrawal and surrender charges are included in contract benefits and terminations; and maintenance fees, any other optional benefit riders and state premium taxes are included in contract charges and deductions in the accompanying Statements of Changes in Net Assets. The operating expenses of the Separate Account are paid by Pacific Life and are not reflected in the accompanying financial statements.
In addition to charges and expenses described above, the Variable Accounts also indirectly bear a portion of the operating expenses of the applicable Portfolios in which they invest.
The assets of certain Variable Accounts invest in Class I or Class D shares of the corresponding Portfolios of the Pacific Select Fund (“PSF”). Each Portfolio of PSF pays an advisory fee to Pacific Life Fund Advisors LLC (“PLFA”), a wholly-owned subsidiary of Pacific Life, pursuant to PSF’s Investment Advisory Agreement and pays a class-specific non-12b-1 service fee for class I shares and a class-specific 12b-1 distribution and service fee for class D shares to Pacific Select Distributors, LLC (“PSD”), also a wholly-owned subsidiary of Pacific Life, for providing shareholder servicing activities under PSF’s non-12b-1 Service Plan and 12b-1 Distribution and Service Plan. Each Portfolio of PSF also compensates Pacific Life and PLFA on an approximate cost basis pursuant to PSF’s Agreement for Support Services for providing services to PSF that are outside the scope of the Investment Adviser’s responsibilities under the Investment Advisory Agreement. The advisory fee and distribution and/or service fee rates are disclosed in the notes to financial statements of PSF, which are provided separately. For the year ended December 31, 2020, PLFA received net advisory fees from the Portfolios of PSF at effective annual rates ranging from 0.05% to 0.90%, and PSD received a non-12b-1 service fee of 0.20% on Class I shares only and a 12b-1 service fee of 0.20% and a distribution fee of 0.05% on Class D shares only, all of which are based on the average daily net assets of each Portfolio.
5. RELATED PARTY AGREEMENT
PSD serves as principal underwriter of the Contracts funded by interests in the Separate Account, without remuneration from the Separate Account.
6. FAIR VALUE MEASUREMENTS
The Variable Accounts characterize their holdings in the Portfolios as Level 1, Level 2, or Level 3 based upon the various inputs or methodologies used to value the holdings. The three-tier hierarchy of inputs is summarized in the three broad levels listed below:
Level 1 — |
Quoted prices (unadjusted) in active markets for identical holdings |
|
|
Level 2 — |
Significant observable market-based inputs, other than Level 1 quoted prices, or unobservable inputs that are corroborated by market data |
|
|
Level 3 — |
Significant unobservable inputs that are not corroborated by observable market data |
The inputs or methodologies used for valuing the Variable Accounts’ holdings are not necessarily an indication of risks associated with investing in those holdings. As of December 31, 2020, the Variable Accounts’ holdings as presented in the Investments section of this report were all categorized as Level 1 under the three-tier hierarchy of inputs.
7. CHANGES IN UNITS OUTSTANDING
The changes in units outstanding for the year or period ended December 31, 2020 and 2019 were as follows:
|
|
2020 |
|
2019 |
| ||||||||
|
|
Units |
|
Units |
|
Net Increase |
|
Units |
|
Units |
|
Net Increase |
|
Variable Accounts |
|
Issued |
|
Redeemed |
|
(Decrease) |
|
Issued |
|
Redeemed |
|
(Decrease) |
|
Core Income Class I |
|
3,460,747 |
|
(2,422,289 |
) |
1,038,458 |
|
1,394,088 |
|
(391,618 |
) |
1,002,470 |
|
Diversified Bond Class I |
|
5,530,045 |
|
(3,513,208 |
) |
2,016,837 |
|
4,262,078 |
|
(2,573,675 |
) |
1,688,403 |
|
Floating Rate Income Class I |
|
2,320,607 |
|
(5,441,240 |
) |
(3,120,633 |
) |
15,242,779 |
|
(6,885,808 |
) |
8,356,971 |
|
High Yield Bond Class I |
|
3,806,524 |
|
(4,624,931 |
) |
(818,407 |
) |
3,447,548 |
|
(3,015,663 |
) |
431,885 |
|
Inflation Managed Class I |
|
2,455,954 |
|
(2,435,188 |
) |
20,766 |
|
1,313,833 |
|
(2,217,525 |
) |
(903,692 |
) |
Managed Bond Class I |
|
7,066,548 |
|
(6,517,073 |
) |
549,475 |
|
5,437,441 |
|
(4,988,041 |
) |
449,400 |
|
Short Duration Bond Class I |
|
14,166,465 |
|
(13,289,124 |
) |
877,341 |
|
10,030,659 |
|
(8,005,911 |
) |
2,024,748 |
|
Emerging Markets Debt Class I |
|
503,742 |
|
(700,552 |
) |
(196,810 |
) |
577,109 |
|
(597,500 |
) |
(20,391 |
) |
Dividend Growth Class I |
|
2,985,011 |
|
(3,176,165 |
) |
(191,154 |
) |
3,198,284 |
|
(2,684,484 |
) |
513,800 |
|
Equity Index Class I |
|
9,023,906 |
|
(8,436,705 |
) |
587,201 |
|
9,797,905 |
|
(6,743,890 |
) |
3,054,015 |
|
Focused Growth Class I |
|
1,671,072 |
|
(2,028,214 |
) |
(357,142 |
) |
1,475,231 |
|
(1,334,143 |
) |
141,088 |
|
Growth Class I |
|
2,559,644 |
|
(2,607,344 |
) |
(47,700 |
) |
1,738,860 |
|
(1,602,938 |
) |
135,922 |
|
Large-Cap Growth Class I |
|
3,287,632 |
|
(3,247,955 |
) |
39,677 |
|
2,161,802 |
|
(2,187,891 |
) |
(26,089 |
) |
SEPARATE ACCOUNT A
NOTES TO FINANCIAL STATEMENTS (Continued)
|
|
2020 |
|
2019 |
| ||||||||
|
|
Units |
|
Units |
|
Net Increase |
|
Units |
|
Units |
|
Net Increase |
|
Variable Accounts |
|
Issued |
|
Redeemed |
|
(Decrease) |
|
Issued |
|
Redeemed |
|
(Decrease) |
|
Large-Cap Value Class I |
|
1,488,041 |
|
(1,883,129 |
) |
(395,088 |
) |
1,111,314 |
|
(1,721,457 |
) |
(610,143 |
) |
Main Street Core Class I |
|
653,509 |
|
(2,027,857 |
) |
(1,374,348 |
) |
685,508 |
|
(1,789,320 |
) |
(1,103,812 |
) |
Mid-Cap Equity Class I |
|
947,313 |
|
(1,500,293 |
) |
(552,980 |
) |
989,064 |
|
(1,279,721 |
) |
(290,657 |
) |
Mid-Cap Growth Class I |
|
2,327,910 |
|
(3,334,250 |
) |
(1,006,340 |
) |
2,193,907 |
|
(2,590,340 |
) |
(396,433 |
) |
Mid-Cap Value Class I |
|
913,280 |
|
(1,451,437 |
) |
(538,157 |
) |
962,127 |
|
(1,010,269 |
) |
(48,142 |
) |
Small-Cap Equity Class I |
|
634,697 |
|
(672,112 |
) |
(37,415 |
) |
618,825 |
|
(550,155 |
) |
68,670 |
|
Small-Cap Growth Class I |
|
1,199,474 |
|
(1,800,841 |
) |
(601,367 |
) |
1,270,795 |
|
(1,731,826 |
) |
(461,031 |
) |
Small-Cap Index Class I |
|
2,678,647 |
|
(2,700,032 |
) |
(21,385 |
) |
2,512,005 |
|
(2,072,419 |
) |
439,586 |
|
Small-Cap Value Class I |
|
1,180,117 |
|
(1,407,260 |
) |
(227,143 |
) |
937,060 |
|
(924,188 |
) |
12,872 |
|
Value Class I |
|
1,752,427 |
|
(2,030,715 |
) |
(278,288 |
) |
951,278 |
|
(1,636,262 |
) |
(684,984 |
) |
Value Advantage Class I |
|
954,664 |
|
(632,875 |
) |
321,789 |
|
727,984 |
|
(413,553 |
) |
314,431 |
|
Emerging Markets Class I |
|
1,318,252 |
|
(2,093,120 |
) |
(774,868 |
) |
1,532,507 |
|
(2,144,009 |
) |
(611,502 |
) |
International Large-Cap Class I |
|
1,974,213 |
|
(2,920,638 |
) |
(946,425 |
) |
1,473,603 |
|
(3,086,374 |
) |
(1,612,771 |
) |
International Small-Cap Class I |
|
526,656 |
|
(783,746 |
) |
(257,090 |
) |
541,071 |
|
(689,443 |
) |
(148,372 |
) |
International Value Class I |
|
1,948,100 |
|
(2,026,444 |
) |
(78,344 |
) |
1,406,620 |
|
(1,776,760 |
) |
(370,140 |
) |
Health Sciences Class I |
|
1,855,741 |
|
(2,409,780 |
) |
(554,039 |
) |
1,375,996 |
|
(1,949,546 |
) |
(573,550 |
) |
Real Estate Class I |
|
1,038,527 |
|
(1,465,599 |
) |
(427,072 |
) |
1,174,371 |
|
(1,599,808 |
) |
(425,437 |
) |
Technology Class I |
|
3,736,825 |
|
(3,683,179 |
) |
53,646 |
|
1,909,495 |
|
(2,222,412 |
) |
(312,917 |
) |
PSF DFA Balanced Allocation Class D |
|
5,117,765 |
|
(2,286,699 |
) |
2,831,066 |
|
5,361,959 |
|
(1,813,180 |
) |
3,548,779 |
|
Pacific Dynamix - Conservative Growth Class I |
|
7,460,876 |
|
(6,797,814 |
) |
663,062 |
|
5,458,737 |
|
(6,206,608 |
) |
(747,871 |
) |
Pacific Dynamix - Moderate Growth Class I |
|
15,844,876 |
|
(20,604,849 |
) |
(4,759,973 |
) |
18,357,964 |
|
(22,272,367 |
) |
(3,914,403 |
) |
Pacific Dynamix - Growth Class I |
|
22,672,191 |
|
(8,204,957 |
) |
14,467,234 |
|
6,681,934 |
|
(6,055,293 |
) |
626,641 |
|
Portfolio Optimization Conservative Class I |
|
43,603,510 |
|
(41,000,206 |
) |
2,603,304 |
|
21,225,140 |
|
(31,217,449 |
) |
(9,992,309 |
) |
Portfolio Optimization Moderate-Conservative Class I |
|
9,067,901 |
|
(26,011,097 |
) |
(16,943,196 |
) |
9,708,928 |
|
(31,998,394 |
) |
(22,289,466 |
) |
Portfolio Optimization Moderate Class I |
|
20,519,492 |
|
(87,556,716 |
) |
(67,037,224 |
) |
20,774,871 |
|
(110,641,449 |
) |
(89,866,578 |
) |
Portfolio Optimization Growth Class I |
|
13,100,550 |
|
(65,727,499 |
) |
(52,626,949 |
) |
9,434,112 |
|
(80,383,454 |
) |
(70,949,342 |
) |
Portfolio Optimization Aggressive-Growth Class I |
|
3,111,184 |
|
(14,775,087 |
) |
(11,663,903 |
) |
2,277,005 |
|
(18,547,481 |
) |
(16,270,476 |
) |
Invesco Oppenheimer V.I. Global Series II |
|
158,702 |
|
(389,876 |
) |
(231,174 |
) |
496,370 |
|
(392,713 |
) |
103,657 |
|
Invesco Oppenheimer V.I. International Growth Series II |
|
275,748 |
|
(207,460 |
) |
68,288 |
|
229,468 |
|
(236,742 |
) |
(7,274 |
) |
Invesco V.I. Balanced-Risk Allocation Series II |
|
2,296,164 |
|
(3,898,592 |
) |
(1,602,428 |
) |
2,055,173 |
|
(4,356,861 |
) |
(2,301,688 |
) |
Invesco V.I. Equity and Income Series II |
|
554,016 |
|
(635,818 |
) |
(81,802 |
) |
799,090 |
|
(576,041 |
) |
223,049 |
|
Invesco V.I. Global Real Estate Series II |
|
283,037 |
|
(316,427 |
) |
(33,390 |
) |
335,230 |
|
(168,269 |
) |
166,961 |
|
American Century VP Mid Cap Value Class II |
|
971,322 |
|
(1,192,831 |
) |
(221,509 |
) |
941,281 |
|
(892,477 |
) |
48,804 |
|
American Funds IS Asset Allocation Class 4 |
|
31,941,578 |
|
(37,235,760 |
) |
(5,294,182 |
) |
35,948,450 |
|
(39,466,258 |
) |
(3,517,808 |
) |
American Funds IS Blue Chip Income and Growth Class 4 |
|
2,513,851 |
|
(1,909,848 |
) |
604,003 |
|
2,895,381 |
|
(1,200,308 |
) |
1,695,073 |
|
American Funds IS Bond Class 4 |
|
5,917,142 |
|
(2,412,686 |
) |
3,504,456 |
|
3,034,977 |
|
(1,046,298 |
) |
1,988,679 |
|
American Funds IS Capital Income Builder Class 4 |
|
1,404,557 |
|
(1,773,356 |
) |
(368,799 |
) |
2,212,567 |
|
(1,316,250 |
) |
896,317 |
|
American Funds IS Capital World Bond Class 4 |
|
515,733 |
|
(282,290 |
) |
233,443 |
|
489,425 |
|
(270,915 |
) |
218,510 |
|
American Funds IS Global Balanced Class 4 |
|
749,272 |
|
(702,780 |
) |
46,492 |
|
981,779 |
|
(519,301 |
) |
462,478 |
|
American Funds IS Global Growth and Income Class 4 |
|
789,668 |
|
(424,189 |
) |
365,479 |
|
1,019,150 |
|
(452,506 |
) |
566,644 |
|
American Funds IS Global Growth Class 4 |
|
1,663,945 |
|
(1,561,527 |
) |
102,418 |
|
1,804,423 |
|
(1,232,950 |
) |
571,473 |
|
American Funds IS Global Small Capitalization Class 4 |
|
470,487 |
|
(320,192 |
) |
150,295 |
|
602,987 |
|
(234,574 |
) |
368,413 |
|
American Funds IS Growth Class 4 |
|
5,976,075 |
|
(6,960,459 |
) |
(984,384 |
) |
4,697,014 |
|
(5,034,460 |
) |
(337,446 |
) |
American Funds IS Growth-Income Class 4 |
|
3,257,912 |
|
(4,891,180 |
) |
(1,633,268 |
) |
3,656,021 |
|
(4,542,988 |
) |
(886,967 |
) |
American Funds IS High-Income Bond Class 4 |
|
1,168,126 |
|
(1,074,971 |
) |
93,155 |
|
1,564,614 |
|
(779,081 |
) |
785,533 |
|
American Funds IS International Class 4 |
|
1,386,499 |
|
(1,530,703 |
) |
(144,204 |
) |
2,564,586 |
|
(1,121,013 |
) |
1,443,573 |
|
American Funds IS International Growth and Income Class 4 |
|
853,738 |
|
(814,092 |
) |
39,646 |
|
997,280 |
|
(715,725 |
) |
281,555 |
|
American Funds IS Managed Risk Asset Allocation Class P2 |
|
2,843,611 |
|
(2,051,782 |
) |
791,829 |
|
2,472,224 |
|
(1,708,288 |
) |
763,936 |
|
American Funds IS New World Fund Class 4 |
|
881,296 |
|
(1,035,471 |
) |
(154,175 |
) |
1,152,997 |
|
(942,965 |
) |
210,032 |
|
American Funds IS U.S. Government/AAA-Rated |
|
|
|
|
|
|
|
|
|
|
|
|
|
Securities Class 4 |
|
15,022,460 |
|
(9,671,366 |
) |
5,351,094 |
|
3,272,461 |
|
(2,608,157 |
) |
664,304 |
|
BlackRock 60/40 Target Allocation ETF V.I. Class I |
|
3,548,029 |
|
(672,222 |
) |
2,875,807 |
|
3,230,776 |
|
(598,151 |
) |
2,632,625 |
|
BlackRock Capital Appreciation V.I. Class III |
|
69,747 |
|
(355,661 |
) |
(285,914 |
) |
86,827 |
|
(269,760 |
) |
(182,933 |
) |
BlackRock Global Allocation V.I. Class III |
|
5,673,830 |
|
(19,004,881 |
) |
(13,331,051 |
) |
5,088,945 |
|
(26,167,736 |
) |
(21,078,791 |
) |
Fidelity VIP Contrafund Service Class 2 |
|
2,776,000 |
|
(3,306,557 |
) |
(530,557 |
) |
2,420,894 |
|
(2,213,336 |
) |
207,558 |
|
Fidelity VIP FundsManager 60% Service Class 2 |
|
4,443,297 |
|
(3,557,769 |
) |
885,528 |
|
3,746,225 |
|
(3,494,593 |
) |
251,632 |
|
SEPARATE ACCOUNT A
NOTES TO FINANCIAL STATEMENTS (Continued)
|
|
2020 |
|
2019 |
| ||||||||
|
|
Units |
|
Units |
|
Net Increase |
|
Units |
|
Units |
|
Net Increase |
|
Variable Accounts |
|
Issued |
|
Redeemed |
|
(Decrease) |
|
Issued |
|
Redeemed |
|
(Decrease) |
|
Fidelity VIP Government Money Market Service Class |
|
81,100,322 |
|
(63,087,359 |
) |
18,012,963 |
|
46,351,944 |
|
(45,300,631 |
) |
1,051,313 |
|
Fidelity VIP Strategic Income Service Class 2 |
|
2,195,632 |
|
(1,939,200 |
) |
256,432 |
|
2,466,611 |
|
(1,067,950 |
) |
1,398,661 |
|
First Trust Dorsey Wright Tactical Core Class I |
|
520,773 |
|
(833,734 |
) |
(312,961 |
) |
1,008,119 |
|
(642,309 |
) |
365,810 |
|
First Trust Multi Income Allocation Class I |
|
278,826 |
|
(202,131 |
) |
76,695 |
|
279,179 |
|
(189,227 |
) |
89,952 |
|
First Trust/Dow Jones Dividend & Income Allocation Class I |
|
6,420,535 |
|
(7,731,269 |
) |
(1,310,734 |
) |
8,638,575 |
|
(7,879,751 |
) |
758,824 |
|
Franklin Allocation VIP Class 2 |
|
116,917 |
|
(139,053 |
) |
(22,136 |
) |
108,765 |
|
(91,820 |
) |
16,945 |
|
Franklin Allocation VIP Class 4 |
|
1,425,625 |
|
(2,919,169 |
) |
(1,493,544 |
) |
1,159,416 |
|
(3,398,311 |
) |
(2,238,895 |
) |
Franklin Income VIP Class 2 |
|
956,158 |
|
(1,097,049 |
) |
(140,891 |
) |
1,568,675 |
|
(581,053 |
) |
987,622 |
|
Franklin Mutual Global Discovery VIP Class 2 |
|
2,298,628 |
|
(2,839,049 |
) |
(540,421 |
) |
921,128 |
|
(2,220,394 |
) |
(1,299,266 |
) |
Franklin Rising Dividends VIP Class 2 |
|
1,536,808 |
|
(2,431,424 |
) |
(894,616 |
) |
2,091,118 |
|
(1,766,072 |
) |
325,046 |
|
Templeton Global Bond VIP Class 2 |
|
1,756,650 |
|
(2,683,233 |
) |
(926,583 |
) |
1,761,950 |
|
(2,203,060 |
) |
(441,110 |
) |
Ivy VIP Asset Strategy Class II |
|
80,081 |
|
(273,456 |
) |
(193,375 |
) |
140,593 |
|
(272,060 |
) |
(131,467 |
) |
Ivy VIP Energy Class II |
|
8,631,012 |
|
(5,842,023 |
) |
2,788,989 |
|
1,751,115 |
|
(1,640,559 |
) |
110,556 |
|
Janus Aspen Series Balanced Service Shares |
|
64,451,088 |
|
(28,850,013 |
) |
35,601,075 |
|
54,366,196 |
|
(20,390,495 |
) |
33,975,701 |
|
Janus Aspen Series Flexible Bond Service Shares |
|
1,604,689 |
|
(1,034,436 |
) |
570,253 |
|
731,128 |
|
(504,905 |
) |
226,223 |
|
JPMorgan Insurance Trust Core Bond Class 1 |
|
— |
|
(1,351 |
) |
(1,351 |
) |
61 |
|
(137 |
) |
(76 |
) |
JPMorgan Insurance Trust Global Allocation Class 2 |
|
87,265 |
|
(126,130 |
) |
(38,865 |
) |
177,660 |
|
(191,142 |
) |
(13,482 |
) |
JPMorgan Insurance Trust Income Builder Class 2 |
|
245,596 |
|
(156,487 |
) |
89,109 |
|
389,880 |
|
(184,404 |
) |
205,476 |
|
JPMorgan Insurance Trust Mid Cap Value Class 1 |
|
— |
|
(90 |
) |
(90 |
) |
— |
|
(144 |
) |
(144 |
) |
JPMorgan Insurance Trust U.S. Equity Class 1 |
|
— |
|
(23 |
) |
(23 |
) |
— |
|
(4 |
) |
(4 |
) |
ClearBridge Variable Aggressive Growth - Class II |
|
349,422 |
|
(246,529 |
) |
102,893 |
|
288,126 |
|
(89,020 |
) |
199,106 |
|
Lord Abbett Bond Debenture Class VC |
|
2,554,039 |
|
(2,339,761 |
) |
214,278 |
|
2,934,528 |
|
(1,538,375 |
) |
1,396,153 |
|
Lord Abbett Total Return Class VC |
|
4,443,896 |
|
(5,301,234 |
) |
(857,338 |
) |
3,335,640 |
|
(4,362,227 |
) |
(1,026,587 |
) |
MFS Massachusetts Investors Growth Stock - Service Class |
|
285,269 |
|
(982,794 |
) |
(697,525 |
) |
232,164 |
|
(971,364 |
) |
(739,200 |
) |
MFS Total Return Series - Service Class |
|
3,550,035 |
|
(4,884,350 |
) |
(1,334,315 |
) |
3,646,466 |
|
(4,363,902 |
) |
(717,436 |
) |
MFS Utilities Series - Service Class |
|
995,237 |
|
(1,470,134 |
) |
(474,897 |
) |
1,315,522 |
|
(1,067,011 |
) |
248,511 |
|
MFS Value Series - Service Class |
|
433,809 |
|
(536,111 |
) |
(102,302 |
) |
230,848 |
|
(565,628 |
) |
(334,780 |
) |
Neuberger Berman U.S. Equity Index PutWrite Strategy Class S |
|
44,279 |
|
(37,270 |
) |
7,009 |
|
52,245 |
|
(15,622 |
) |
36,623 |
|
PIMCO All Asset - Advisor Class |
|
228,936 |
|
(26,777 |
) |
202,159 |
|
|
|
|
|
|
|
PIMCO CommodityRealReturn Strategy - Advisor Class |
|
439,066 |
|
(272,092 |
) |
166,974 |
|
396,173 |
|
(384,146 |
) |
12,027 |
|
PIMCO Income - Advisor Class |
|
643,971 |
|
(173,922 |
) |
470,049 |
|
|
|
|
|
|
|
Jennison Class II |
|
— |
|
(14 |
) |
(14 |
) |
— |
|
(3 |
) |
(3 |
) |
SP International Growth Class II |
|
— |
|
(136 |
) |
(136 |
) |
— |
|
(194 |
) |
(194 |
) |
SP Prudential U.S. Emerging Growth Class II |
|
306 |
|
(2,016 |
) |
(1,710 |
) |
— |
|
(1,073 |
) |
(1,073 |
) |
Value Class II |
|
— |
|
(112 |
) |
(112 |
) |
— |
|
(1,914 |
) |
(1,914 |
) |
Schwab VIT Balanced |
|
857,774 |
|
(692,212 |
) |
165,562 |
|
924,272 |
|
(1,063,939 |
) |
(139,667 |
) |
Schwab VIT Balanced with Growth |
|
145,802 |
|
(888,422 |
) |
(742,620 |
) |
774,404 |
|
(949,808 |
) |
(175,404 |
) |
Schwab VIT Growth |
|
382,152 |
|
(1,026,210 |
) |
(644,058 |
) |
511,975 |
|
(925,847 |
) |
(413,872 |
) |
State Street Total Return V.I.S. Class 3 |
|
1,986,882 |
|
(4,189,399 |
) |
(2,202,517 |
) |
1,608,823 |
|
(4,484,849 |
) |
(2,876,026 |
) |
VanEck VIP Global Hard Assets Class S |
|
2,055,275 |
|
(1,968,921 |
) |
86,354 |
|
1,059,862 |
|
(785,538 |
) |
274,324 |
|
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors of
Pacific Life Insurance Company:
Opinion on the Financial Statements
We have audited the accompanying statements of assets and liabilities of Separate Account A of Pacific Life Insurance Company (the “Separate Account”) comprising the variable accounts listed in Appendix A, including the schedules of investments as of December 31, 2020, the related statements of operations, statements of changes in net assets, and financial highlights for the periods indicated in Appendix A, and the related notes. In our opinion, the financial statements present fairly, in all material respects, the financial position of each of the Variable Accounts constituting the Separate Account A of Pacific Life Insurance Company as of December 31, 2020, the results of their operations, changes in their net assets, and financial highlights for each of the periods indicated in Appendix A, in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These financial statements and financial highlights are the responsibility of the Separate Account’s management. Our responsibility is to express an opinion on the Separate Account’s financial statements and financial highlights based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Separate Account in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement, whether due to error or fraud. The Separate Account is not required to have, nor were we engaged to perform, an audit of their internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Separate Account’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. Our procedures included confirmation of investments owned as of December 31, 2020, by correspondence with the transfer agents. We believe that our audits provide a reasonable basis for our opinion.
Costa Mesa, California
We have served as the auditor of Separate Account A of Pacific Life Insurance Company since 1996.
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM (Continued)
APPENDIX A
Variable Account comprising |
|
Statement of Operations |
|
Statement of Changes in Net Assets |
|
Financial Highlights |
Core Income Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Diversified Bond Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Floating Rate Income Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
High Yield Bond Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Inflation Managed Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Managed Bond Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Short Duration Bond Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Emerging Markets Debt Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Dividend Growth Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Equity Index Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Focused Growth Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Growth Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Large-Cap Growth Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Large-Cap Value Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Main Street® Core Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Mid-Cap Equity Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Mid-Cap Growth Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Mid-Cap Value Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Small-Cap Equity Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Small-Cap Growth Class I (formerly Developing Growth Class I) |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Small-Cap Index Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Small-Cap Value Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Value Class I (formerly Comstock Class I) |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Value Advantage Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Emerging Markets Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
International Large-Cap Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM (Continued)
APPENDIX A (Continued)
Variable Account comprising |
|
Statement of Operations |
|
Statement of Changes in Net Assets |
|
Financial Highlights |
International Small-Cap Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
International Value Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Health Sciences Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Real Estate Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Technology Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
PSF DFA Balanced Allocation Class D |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For the years ended December 31, 2020, 2019, 2018, 2017 and the period from May 3, 2016 (commencement of operations) through December 31, 2016 |
Pacific Dynamix - Conservative Growth Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Pacific Dynamix - Moderate Growth Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Pacific Dynamix - Growth Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Portfolio Optimization Conservative Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Portfolio Optimization Moderate-Conservative Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Portfolio Optimization Moderate |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Portfolio Optimization Growth Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Portfolio Optimization Aggressive-Growth Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Invesco Oppenheimer V.I. Global Series II |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Invesco Oppenheimer V.I. International Growth Series II |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Invesco V.I. Balanced-Risk Allocation Series II |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Invesco V.I. Equity and Income |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Invesco V.I. Global Real Estate |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
American Century VP Mid Cap Value Class II |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
American Funds IS Asset Allocation Class 4 |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
American Funds IS Blue Chip Income and Growth Class 4 |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
American Funds IS Bond Class 4 |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
American Funds IS Capital Income Builder® Class 4 |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
American Funds IS Capital World Bond Class 4 (formerly American Funds IS Global Bond Class 4) |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM (Continued)
APPENDIX A (Continued)
Variable Account comprising |
|
Statement of Operations |
|
Statement of Changes in Net Assets |
|
Financial Highlights |
American Funds IS Global Balanced Class 4 |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
American Funds IS Global Growth and Income Class 4 |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
American Funds IS Global Growth Class 4 |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
American Funds IS Global Small Capitalization Class 4 |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
American Funds IS Growth Class 4 |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
American Funds IS Growth-Income Class 4 |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
American Funds IS High-Income Bond Class 4 |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
American Funds IS International |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
American Funds IS International Growth and Income Class 4 |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
American Funds IS Managed Risk Asset Allocation Class P2 |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
American Funds IS New World Fund® Class 4 |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
American Funds IS U.S. Government/AAA-Rated Securities Class 4 |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
BlackRock® 60/40 Target Allocation ETF V.I. Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
BlackRock® Capital Appreciation V.I. Class III |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
BlackRock® Global Allocation V.I. Class III |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Fidelity® VIP Contrafund® Service Class 2 |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Fidelity® VIP FundsManager® 60% Service Class 2 |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Fidelity® VIP Government Money Market Service Class |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Fidelity® VIP Strategic Income Service Class 2 |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
First Trust Dorsey Wright Tactical Core Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
First Trust Multi Income Allocation Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
First Trust/Dow Jones Dividend & Income Allocation Class I |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Franklin Allocation VIP Class 2 |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Franklin Allocation VIP Class 4 |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Franklin Income VIP Class 2 |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Franklin Mutual Global Discovery VIP Class 2 |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM (Continued)
APPENDIX A (Continued)
Variable Account comprising |
|
Statement of Operations |
|
Statement of Changes in Net Assets |
|
Financial Highlights |
Franklin Rising Dividends VIP Class 2 |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Templeton Global Bond VIP Class 2 |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Ivy VIP Asset Strategy Class II |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Ivy VIP Energy Class II |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Janus Henderson Balanced Service Shares |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Janus Henderson Flexible Bond Service Shares |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
JPMorgan Insurance Trust Core Bond Class 1 |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
JPMorgan Insurance Trust Global Allocation Class 2 |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
JPMorgan Insurance Trust Income Builder Class 2 |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
JPMorgan Insurance Trust Mid Cap Value Class 1 |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
JPMorgan Insurance Trust U.S. Equity Class 1 |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
ClearBridge Variable Aggressive Growth - Class II |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Lord Abbett Bond Debenture Class VC |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Lord Abbett Total Return Class VC |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
MFS® Massachusetts Investors Growth Stock - Service Class |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
MFS® Total Return Series - Service Class |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
MFS® Utilities Series - Service Class |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
MFS® Value Series - Service Class |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Neuberger Berman U.S. Equity Index PutWrite Strategy Class S |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
PIMCO All Asset - Advisor Class |
|
For the period May 28, 2020 (commencement of operations) through December 31, 2020 | ||||
PIMCO CommodityRealReturn® Strategy - Advisor Class |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
PIMCO Income - Advisor Class |
|
For the period May 7, 2020 (commencement of operations) through December 31, 2020 | ||||
Jennison Class II |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
SP International Growth Class II |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
SP Prudential U.S. Emerging Growth Class II |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Value Class II |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Schwab Government Money Market |
|
Not Applicable |
|
Not Applicable |
|
For the period from May 7, 2018 through September 6, 2018 |
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM (Continued)
APPENDIX A (Continued)
Variable Account comprising |
|
Statement of Operations |
|
Statement of Changes in Net Assets |
|
Financial Highlights |
Schwab VIT Balanced |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Schwab VIT Balanced with Growth |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
Schwab VIT Growth |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
State Street Total Return V.I.S. |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
VanEck VIP Global Hard Assets |
|
For the year ended December 31, 2020 |
|
For each of the two years in the period ended December 31, 2020 |
|
For each of the five years in the period ended December 31, 2020 |
PACIFIC LIFE INSURANCE COMPANY
AND SUBSIDIARIES
Consolidated Financial Statements
as of December 31, 2020 and 2019 and
for the years ended December 31, 2020, 2019 and 2018
and Independent Auditors’ Report
INDEPENDENT AUDITORS’ REPORT
Pacific Life Insurance Company and Subsidiaries:
We have audited the accompanying consolidated financial statements of Pacific Life Insurance Company and Subsidiaries (the “Company”), which comprise the consolidated statements of financial condition as of December 31, 2020 and 2019, and the related consolidated statements of operations, comprehensive income (loss), equity, and cash flows for each of the three years in the period ended December 31, 2020 and the related notes to consolidated financial statements.
Management’s Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.
Auditors’ Responsibility
Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company’s preparation and fair presentation of the consolidated financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.
We believe that the audit evidence that we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinion
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Pacific Life Insurance Company and Subsidiaries as of December 31, 2020 and 2019, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2020 in accordance with accounting principles generally accepted in the United States of America.
Emphasis of Matter
As discussed in Note 6 to the consolidated financial statements, the accompanying consolidated financial statements have been reclassified to give effect to the discontinued operations of the aircraft leasing business.
Pacific Life Insurance Company and Subsidiaries
C O N S O L I D A T E D S T A T E M E N T S O F F I N A N C I A L C O N D I T I O N
|
|
December 31, |
| ||||
(In Millions, except share data) |
|
2020 |
|
2019 |
| ||
ASSETS |
|
|
|
|
| ||
Investments: |
|
|
|
|
| ||
Fixed maturity securities available for sale, at fair value |
|
$ |
72,862 |
|
$ |
61,806 |
|
Fair value option securities (includes VIE assets of $963 and $977) |
|
1,664 |
|
1,584 |
| ||
Mortgage loans (includes VIE assets of $2,050 and $1,800) |
|
17,842 |
|
16,388 |
| ||
Policy loans |
|
7,700 |
|
7,950 |
| ||
Other investments (includes VIE assets of $1,176 and $776) |
|
6,618 |
|
5,707 |
| ||
TOTAL INVESTMENTS |
|
106,686 |
|
93,435 |
| ||
Cash, cash equivalents, and restricted cash (includes VIE assets of $46 and $57) |
|
5,506 |
|
6,111 |
| ||
Deferred policy acquisition costs |
|
4,843 |
|
4,804 |
| ||
Other assets (includes VIE assets of $46 and $7) |
|
3,403 |
|
2,574 |
| ||
Separate account assets |
|
64,900 |
|
60,192 |
| ||
TOTAL ASSETS |
|
$ |
185,338 |
|
$ |
167,116 |
|
LIABILITIES AND EQUITY |
|
|
|
|
| ||
Liabilities: |
|
|
|
|
| ||
Policyholder account balances |
|
$ |
66,136 |
|
$ |
60,634 |
|
Future policy benefits |
|
26,586 |
|
21,684 |
| ||
Debt (includes VIE debt of $1,872 and $1,634) |
|
4,762 |
|
4,542 |
| ||
Fair value option debt (represents VIE debt) |
|
913 |
|
910 |
| ||
Other liabilities (includes VIE liabilities of $22 and $34) |
|
5,513 |
|
4,755 |
| ||
Separate account liabilities |
|
64,900 |
|
60,192 |
| ||
TOTAL LIABILITIES |
|
168,810 |
|
152,717 |
| ||
Commitments and contingencies (Note 16) |
|
|
|
|
| ||
Stockholder’s Equity: |
|
|
|
|
| ||
Common stock - $50 par value; 600,000 shares authorized, issued and outstanding |
|
30 |
|
30 |
| ||
Additional paid-in capital |
|
1,669 |
|
1,019 |
| ||
Retained earnings |
|
10,047 |
|
10,571 |
| ||
Accumulated other comprehensive income |
|
4,523 |
|
2,603 |
| ||
Total Stockholder’s Equity |
|
16,269 |
|
14,223 |
| ||
Noncontrolling interests |
|
259 |
|
176 |
| ||
TOTAL EQUITY |
|
16,528 |
|
14,399 |
| ||
TOTAL LIABILITIES AND EQUITY |
|
$ |
185,338 |
|
$ |
167,116 |
|
The abbreviation VIE above means variable interest entity.
See Notes to Consolidated Financial Statements
Pacific Life Insurance Company and Subsidiaries
C O N S O L I D A T E D S T A T E M E N T S O F O P E R A T I O N S
|
|
Years Ended December 31, |
| |||||||
(In Millions) |
|
2020 |
|
2019 |
|
2018 |
| |||
REVENUES |
|
|
|
|
|
|
| |||
Policy fees and insurance premiums |
|
$ |
5,767 |
|
$ |
5,878 |
|
$ |
4,750 |
|
Net investment income |
|
3,678 |
|
3,514 |
|
3,243 |
| |||
Net realized investment gain (loss) |
|
(1,228 |
) |
(391 |
) |
60 |
| |||
Other than temporary impairments |
|
(81 |
) |
(19 |
) |
(15 |
) | |||
Investment advisory fees |
|
243 |
|
265 |
|
295 |
| |||
Other income |
|
265 |
|
298 |
|
264 |
| |||
TOTAL REVENUES |
|
8,644 |
|
9,545 |
|
8,597 |
| |||
|
|
|
|
|
|
|
| |||
BENEFITS AND EXPENSES |
|
|
|
|
|
|
| |||
Policy benefits paid or provided |
|
5,386 |
|
4,915 |
|
3,644 |
| |||
Interest credited to policyholder account balances |
|
1,796 |
|
1,633 |
|
1,490 |
| |||
Commission expenses |
|
672 |
|
877 |
|
1,264 |
| |||
Operating and other expenses |
|
1,575 |
|
1,503 |
|
1,427 |
| |||
TOTAL BENEFITS AND EXPENSES |
|
9,429 |
|
8,928 |
|
7,825 |
| |||
|
|
|
|
|
|
|
| |||
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE PROVISION (BENEFIT) FOR INCOME TAXES FROM CONTINUING OPERATIONS |
|
(785 |
) |
617 |
|
772 |
| |||
Provision (benefit) for income taxes from continuing operations |
|
(273 |
) |
65 |
|
74 |
| |||
|
|
|
|
|
|
|
| |||
INCOME (LOSS) FROM CONTINUING OPERATIONS |
|
(512 |
) |
552 |
|
698 |
| |||
Discontinued operations, net of taxes (Note 6) |
|
|
|
359 |
|
229 |
| |||
|
|
|
|
|
|
|
| |||
Net income (loss) |
|
(512 |
) |
911 |
|
927 |
| |||
Less: net income from continuing operations attributable to noncontrolling interests |
|
(12 |
) |
(24 |
) |
(3 |
) | |||
Less: income from discontinued operations attributable to noncontrolling interest |
|
|
|
(100 |
) |
(53 |
) | |||
|
|
|
|
|
|
|
| |||
NET INCOME (LOSS) ATTRIBUTABLE TO THE COMPANY |
|
$ |
(524 |
) |
$ |
787 |
|
$ |
871 |
|
See Notes to Consolidated Financial Statements
Pacific Life Insurance Company and Subsidiaries
C O N S O L I D A T E D S T A T E M E N T S O F C O M P R E H E N S I V E I N C O M E ( L O S S )
|
|
Years Ended December 31, |
| |||||||
(In Millions) |
|
2020 |
|
2019 |
|
2018 |
| |||
NET INCOME (LOSS) |
|
$ |
(512 |
) |
$ |
911 |
|
$ |
927 |
|
|
|
|
|
|
|
|
| |||
Other comprehensive income (loss), net of tax: |
|
|
|
|
|
|
| |||
Gain (loss) on derivatives and unrealized gain (loss) on securities available for sale, net |
|
1,914 |
|
2,523 |
|
(1,529 |
) | |||
Other, net |
|
6 |
|
7 |
|
(8 |
) | |||
|
|
|
|
|
|
|
| |||
Other comprehensive income (loss) |
|
1,920 |
|
2,530 |
|
(1,537 |
) | |||
|
|
|
|
|
|
|
| |||
Comprehensive income (loss) |
|
1,408 |
|
3,441 |
|
(610 |
) | |||
Less: comprehensive income attributable to noncontrolling interests |
|
(12 |
) |
(124 |
) |
(56 |
) | |||
|
|
|
|
|
|
|
| |||
COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO THE COMPANY |
|
$ |
1,396 |
|
$ |
3,317 |
|
$ |
(666 |
) |
See Notes to Consolidated Financial Statements
Pacific Life Insurance Company and Subsidiaries
C O N S O L I D A T E D S T A T E M E N T S O F E Q U I T Y
|
|
Common |
|
Additional |
|
Retained |
|
Accumulated Other |
|
Total |
|
Noncontrolling |
|
Total |
| |||||||
(In Millions) |
|
Stock |
|
Capital |
|
Earnings |
|
Income |
|
Equity |
|
Interests |
|
Equity |
| |||||||
BALANCES, DECEMBER 31, 2017 |
|
$ |
30 |
|
$ |
1,023 |
|
$ |
9,534 |
|
$ |
1,613 |
|
$ |
12,200 |
|
$ |
695 |
|
$ |
12,895 |
|
Cumulative effect of adoption of accounting change (Note 1) |
|
|
|
|
|
29 |
|
(3 |
) |
26 |
|
|
|
26 |
| |||||||
BALANCES, JANUARY 1, 2018 |
|
30 |
|
1,023 |
|
9,563 |
|
1,610 |
|
12,226 |
|
695 |
|
12,921 |
| |||||||
Comprehensive income (loss): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
Net income |
|
|
|
|
|
871 |
|
|
|
871 |
|
56 |
|
927 |
| |||||||
OCI |
|
|
|
|
|
|
|
(1,537 |
) |
(1,537 |
) |
|
|
(1,537 |
) | |||||||
Total comprehensive income (loss) |
|
|
|
|
|
|
|
|
|
(666 |
) |
56 |
|
(610 |
) | |||||||
Change in equity of noncontrolling interests |
|
|
|
|
|
|
|
|
|
|
|
32 |
|
32 |
| |||||||
BALANCES, DECEMBER 31, 2018 |
|
30 |
|
1,023 |
|
10,434 |
|
73 |
|
11,560 |
|
783 |
|
12,343 |
| |||||||
Comprehensive income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
Net income |
|
|
|
|
|
787 |
|
|
|
787 |
|
124 |
|
911 |
| |||||||
OCI |
|
|
|
|
|
|
|
2,530 |
|
2,530 |
|
|
|
2,530 |
| |||||||
Total comprehensive income |
|
|
|
|
|
|
|
|
|
3,317 |
|
124 |
|
3,441 |
| |||||||
Dividend to parent |
|
|
|
|
|
(650 |
) |
|
|
(650 |
) |
|
|
(650 |
) | |||||||
Equity capital contribution, net of tax, for additional interest in discontinued operation |
|
|
|
5 |
|
|
|
|
|
5 |
|
194 |
|
199 |
| |||||||
Distributions of noncontrolling interest for sale of discontinued operation (Note 6) |
|
|
|
(9 |
) |
|
|
|
|
(9 |
) |
(940 |
) |
(949 |
) | |||||||
Change in equity of noncontrolling interests |
|
|
|
|
|
|
|
|
|
|
|
15 |
|
15 |
| |||||||
BALANCES, DECEMBER 31, 2019 |
|
30 |
|
1,019 |
|
10,571 |
|
2,603 |
|
14,223 |
|
176 |
|
14,399 |
| |||||||
Comprehensive income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
Net income (loss) |
|
|
|
|
|
(524 |
) |
|
|
(524 |
) |
12 |
|
(512 |
) | |||||||
OCI |
|
|
|
|
|
|
|
1,920 |
|
1,920 |
|
|
|
1,920 |
| |||||||
Total comprehensive income |
|
|
|
|
|
|
|
|
|
1,396 |
|
12 |
|
1,408 |
| |||||||
Capital contribution from parent |
|
|
|
650 |
|
|
|
|
|
650 |
|
|
|
650 |
| |||||||
Change in equity of noncontrolling interests |
|
|
|
|
|
|
|
|
|
|
|
71 |
|
71 |
| |||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
BALANCES, DECEMBER 31, 2020 |
|
$ |
30 |
|
$ |
1,669 |
|
$ |
10,047 |
|
$ |
4,523 |
|
$ |
16,269 |
|
$ |
259 |
|
$ |
16,528 |
|
The abbreviation OCI above means other comprehensive income (loss).
See Notes to Consolidated Financial Statements
Pacific Life Insurance Company and Subsidiaries
C O N S O L I D A T E D S T A T E M E N T S O F C A S H F L O W S
|
|
Years Ended December 31, |
| |||||||
(In Millions) |
|
2020 |
|
2019 |
|
2018 |
| |||
CASH FLOWS FROM OPERATING ACTIVITIES |
|
|
|
|
|
|
| |||
Net income (loss) from continuing operations |
|
$ |
(512 |
) |
$ |
552 |
|
$ |
698 |
|
Adjustments to reconcile net income (loss) from continuing operations to net cash provided by operating activities: |
|
|
|
|
|
|
| |||
Net accretion on fixed maturity securities |
|
(35 |
) |
(42 |
) |
(45 |
) | |||
Depreciation and amortization |
|
101 |
|
90 |
|
76 |
| |||
Deferred income taxes |
|
(111 |
) |
(77 |
) |
207 |
| |||
Net realized investment (gain) loss |
|
1,228 |
|
391 |
|
(60 |
) | |||
Other than temporary impairments |
|
81 |
|
19 |
|
15 |
| |||
Net change in deferred policy acquisition costs |
|
(469 |
) |
(372 |
) |
13 |
| |||
Interest credited to policyholder account balances |
|
1,796 |
|
1,633 |
|
1,490 |
| |||
Net change in future policy benefits |
|
3,087 |
|
2,649 |
|
1,806 |
| |||
Net change in tax receivables and payables |
|
(666 |
) |
126 |
|
(30 |
) | |||
Purchases of trading securities |
|
(538 |
) |
(890 |
) |
(299 |
) | |||
Proceeds from disposals of trading securities |
|
536 |
|
439 |
|
265 |
| |||
Other operating activities, net |
|
(114 |
) |
5 |
|
(111 |
) | |||
Net cash provided by operating activities - discontinued operation |
|
|
|
548 |
|
629 |
| |||
NET CASH PROVIDED BY OPERATING ACTIVITIES |
|
4,384 |
|
5,071 |
|
4,654 |
| |||
|
|
|
|
|
|
|
| |||
CASH FLOWS FROM INVESTING ACTIVITIES |
|
|
|
|
|
|
| |||
Available for sale securities: |
|
|
|
|
|
|
| |||
Purchases |
|
(12,635 |
) |
(10,755 |
) |
(10,513 |
) | |||
Sales |
|
1,267 |
|
1,668 |
|
1,632 |
| |||
Maturities and repayments |
|
4,638 |
|
3,409 |
|
2,216 |
| |||
Purchases of fair value option securities |
|
(254 |
) |
(857 |
) |
(882 |
) | |||
Proceeds from disposals of fair value option securities |
|
245 |
|
851 |
|
440 |
| |||
Proceeds from sale of equity securities |
|
3 |
|
101 |
|
641 |
| |||
Fundings of mortgage loans |
|
(2,040 |
) |
(2,805 |
) |
(2,093 |
) | |||
Repayments of mortgage loans |
|
592 |
|
1,348 |
|
740 |
| |||
Purchases of real estate |
|
(246 |
) |
(878 |
) |
(343 |
) | |||
Net change in policy loans |
|
250 |
|
25 |
|
(294 |
) | |||
Terminations of derivative instruments, net |
|
856 |
|
447 |
|
445 |
| |||
Proceeds from nonhedging derivative settlements |
|
783 |
|
278 |
|
311 |
| |||
Payments for nonhedging derivative settlements |
|
(2,146 |
) |
(845 |
) |
(517 |
) | |||
Purchases of working capital finance investments |
|
(1,656 |
) |
(1,000 |
) |
(943 |
) | |||
Repayments of working capital finance investments |
|
1,565 |
|
951 |
|
983 |
| |||
Net change in cash collateral |
|
342 |
|
579 |
|
(289 |
) | |||
Other investing activities, net |
|
(666 |
) |
(140 |
) |
(522 |
) | |||
Net cash provided by (used in) investing activities - discontinued operation |
|
|
|
1,272 |
|
(1,600 |
) | |||
NET CASH USED IN INVESTING ACTIVITIES |
|
(9,102 |
) |
(6,351 |
) |
(10,588 |
) | |||
(Continued)
See Notes to Consolidated Financial Statements
(Continued)
Pacific Life Insurance Company and Subsidiaries
C O N S O L I D A T E D S T A T E M E N T S O F C A S H F L O W S
|
|
Years Ended December 31, |
| |||||||
(In Millions) |
|
2020 |
|
2019 |
|
2018 |
| |||
CASH FLOWS FROM FINANCING ACTIVITIES |
|
|
|
|
|
|
| |||
Policyholder account balances: |
|
|
|
|
|
|
| |||
Deposits |
|
$ |
10,176 |
|
$ |
9,867 |
|
$ |
9,575 |
|
Withdrawals |
|
(7,558 |
) |
(6,089 |
) |
(5,910 |
) | |||
Issuance of long-term debt |
|
243 |
|
359 |
|
148 |
| |||
Payments of long-term debt |
|
(87 |
) |
(290 |
) |
(2 |
) | |||
Issuance of fair value option debt |
|
|
|
|
|
460 |
| |||
Net change in cash collateral for loaned securities |
|
550 |
|
835 |
|
472 |
| |||
Dividend to parent |
|
|
|
(650 |
) |
|
| |||
Capital contribution from parent |
|
650 |
|
|
|
|
| |||
Other financing activities, net |
|
139 |
|
(27 |
) |
16 |
| |||
Net cash provided by financing activities - discontinued operation |
|
|
|
452 |
|
1,258 |
| |||
NET CASH PROVIDED BY FINANCING ACTIVITIES |
|
4,113 |
|
4,457 |
|
6,017 |
| |||
|
|
|
|
|
|
|
| |||
Net change in cash, cash equivalents, and restricted cash |
|
(605 |
) |
3,177 |
|
83 |
| |||
Cash, cash equivalents, and restricted cash, beginning of year |
|
6,111 |
|
2,274 |
|
2,478 |
| |||
Change in cash, cash equivalents, and restricted cash of disposed subsidiary |
|
|
|
660 |
|
(287 |
) | |||
|
|
|
|
|
|
|
| |||
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, END OF YEAR |
|
$ |
5,506 |
|
$ |
6,111 |
|
$ |
2,274 |
|
|
|
|
|
|
|
|
| |||
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION |
|
|
|
|
|
|
| |||
Income taxes paid (received), net |
|
$ |
534 |
|
$ |
18 |
|
$ |
(54 |
) |
Interest paid from continuing operations |
|
229 |
|
255 |
|
234 |
| |||
Interest paid from discontinued operation |
|
|
|
266 |
|
216 |
| |||
NON-CASH TRANSACTIONS |
|
|
|
|
|
|
| |||
Assets received in connection with pension risk transfer transactions |
|
507 |
|
221 |
|
|
| |||
Noncash decrease in taxes payable |
|
341 |
|
135 |
|
|
|
See Notes to Consolidated Financial Statements
Pacific Life Insurance Company and Subsidiaries
N O T E S T O C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION AND DESCRIPTION OF BUSINESS
Pacific Life Insurance Company (Pacific Life) was established in 1868 and is domiciled in the State of Nebraska as a stock life insurance company. Pacific Life is an indirect subsidiary of Pacific Mutual Holding Company (PMHC), a Nebraska mutual holding company, and a wholly owned subsidiary of Pacific LifeCorp, an intermediate Delaware stock holding company. Pacific Life and its subsidiaries (the Company) and affiliates have primary business operations consisting of life insurance, annuities, and reinsurance.
BASIS OF PRESENTATION AND PRINCIPLES OF CONSOLIDATION
The accompanying consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP) and include the accounts of Pacific Life and its majority owned and controlled subsidiaries and the variable interest entities (VIEs) in which the Company is the primary beneficiary. All significant intercompany transactions and balances have been eliminated in consolidation.
Pacific Life prepares its regulatory financial statements in accordance with statutory accounting practices prescribed or permitted by the Nebraska Department of Insurance (NE DOI), which is a comprehensive basis of accounting other than U.S. GAAP (Note 2). These consolidated financial statements materially differ from those filed with regulatory authorities.
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates especially when considering the risks and uncertainties associated with COVID-19 and the impact it may have on our business, results of operations and financial condition.
In developing these estimates, management makes subjective and complex judgments that are inherently uncertain and subject to material change as facts and circumstances develop. Management has identified the following estimates as critical, as they involve a higher degree of judgment and are subject to a significant degree of variability:
· The fair value of investments in the absence of quoted market values
· Other than temporary impairment (OTTI) losses of investments
· Application of the consolidation rules to certain investments
· The fair value of and accounting for derivatives, including embedded derivatives
· The capitalization and amortization of deferred policy acquisition costs (DAC)
· The liability for future policy benefits, including guarantees
· Income taxes
· Reinsurance transactions
· Litigation and other contingencies
In June 2020, Pacific Life launched a $15 billion funding agreement-backed notes (FABN) program through a special-purpose, unaffiliated statutory trust. The trust issues senior secured medium-term notes and uses the net proceeds from each sale to purchase one or more funding agreements from Pacific Life. As of December 31, 2020, Pacific Life had $1.3 billion of FABN funding agreements outstanding, which are recorded within policyholder account balances. In June 2020, Pacific Life also launched a $5 billion funding agreement-backed commercial paper (FABCP) program through a special-purpose, unaffiliated limited liability company. The limited liability company issues commercial paper and uses the net proceeds from each sale to make a deposit under the associated funding agreement from Pacific Life. As of December 31, 2020, the Company’s FABCP funding agreement had net deposits of $568 million, which are also recorded within policyholder account balances. See Note 8.
Certain reclassifications have been made to the 2019 and 2018 consolidated financial statements to conform to the 2020 consolidated financial statement presentation.
The Company has evaluated events subsequent to December 31, 2020 through the date the consolidated financial statements were available to be issued.
Economic and capital market uncertainties have arisen as a result of the spread of COVID-19. The impact of COVID-19 on the Company is constantly evolving and its future effects are uncertain. It is not possible to estimate the ultimate impacts the COVID-19 pandemic may have on the global economy, markets or our business. Interest rates, credit spreads, and equity market levels have had the most significant effect on the Company’s financial statements. COVID-19 related claims have not been material through December 31, 2020. The Company continues to actively monitor direct and indirect impacts of the pandemic on its consolidated financial statements, especially in relation to claims activity and the investments portfolio.
INVESTMENTS
Fixed maturity securities available for sale are reported at fair value, with unrealized gains and losses, net of adjustments related to DAC, future policy benefits and deferred income taxes, recognized as a component of other comprehensive income (loss) (OCI).
Amortization of premium and accretion of discount on fixed maturity securities is recorded using the effective interest method. For mortgage-backed and asset-backed securities, the determination of effective yield is based on anticipated prepayments and the estimated economic life of the securities. When estimates of prepayments change, the effective yield is recalculated to reflect actual payments to date and anticipated future payments.
Investment income consists primarily of interest and dividends, net investment income from partnership interests, prepayment fees on fixed maturity securities and mortgage loans, and income from certain derivatives. Interest is recognized on an accrual basis and dividends are recorded on the ex-dividend date.
The Company’s available for sale securities are assessed for OTTI, if impaired. If a decline in the fair value of an available for sale security is deemed to be other than temporary, the OTTI is recognized equal to the difference between the fair value and net carrying amount of the security. If the OTTI for a fixed maturity security is attributable to both credit and other factors, then the OTTI is bifurcated and the non credit-related portion is recognized in OCI while the credit portion is recognized in earnings, specifically OTTI. If the OTTI is related to credit factors only or management has determined that it is more likely than not going to be required to sell the security prior to recovery, the OTTI is recognized in earnings, specifically OTTI.
The evaluation of OTTI is a quantitative and qualitative process subject to significant estimates and management judgment. The Company has controls and procedures in place to monitor securities and identify those that are subject to greater analysis for OTTI. The Company has an investment impairment committee that reviews and evaluates securities for potential OTTI at minimum on a quarterly basis.
In evaluating whether a decline in value is other than temporary, the Company considers many factors including, but not limited to, the following: the extent and duration of the decline in value; the reasons for the decline (credit event, currency, interest rate related, or spread widening); the ability and intent to hold the investment for a period of time to allow for a recovery of value; and the financial condition of and near-term prospects of the issuer.
For fixed maturity securities in unrealized loss positions, the Company evaluates whether it intends to sell, or will be required to sell the security before anticipated recovery of amortized cost. If a security meets either criteria, it is considered an other than temporary impairment. If a security does not meet either criteria, an analysis is performed on whether projected future cash flows are sufficient to recover the amortized cost.
For mortgage-backed and asset-backed securities, the Company evaluates the performance of the underlying collateral and projected future discounted cash flows. In projecting future discounted cash flows, the Company incorporates inputs from third-party sources and applies reasonable judgment in developing assumptions used to estimate the probability and timing of collecting all contractual cash flows.
Realized gains and losses on investment transactions are determined on a specific identification basis at trade date and are included in net realized investment gain (loss).
The Company has elected the fair value option (FVO) method of accounting for a portfolio of U.S. Government securities and syndicated bank loans. The Company elected the FVO in order to report the investments at fair value with changes in the fair value of these securities recognized in net realized investment gain (loss). This accounting treatment for the U.S. Government securities will provide a partial offset on income volatility due to the impact of interest rate movements. The Company has elected the FVO for debt issued from a collateralized loan obligation (CLO) that is classified as a VIE. The debt and syndicated bank loans were designated as FVO to reduce the impact of market value changes from the CLO on the consolidated financial statements. See Notes 3 and 10.
Mortgage loans on real estate are carried at their unpaid principal balance, net of deferred origination fees and write-downs. Interest is recognized and discounts and deferred origination fees are amortized in interest income using the effective interest method based on the contractual life of the mortgage loan. Mortgage loans are considered to be impaired when management estimates that based upon current information and events, it is probable that the Company will not be able to collect all amounts due according to the contractual terms of the mortgage loan agreement. For mortgage loans deemed to be impaired, an impairment loss is recorded when the carrying amount is greater than the Company’s fair value of the underlying collateral of the mortgage loan.
Policy loans are stated at unpaid principal balances. Interest income is recorded as earned using the contractual interest rate. Generally, accrued interest is capitalized on the policy’s anniversary date. Valuation allowances are not established for policy loans, as they are fully collateralized by the cash surrender value of the underlying insurance policies. Any unpaid principal and accrued interest is deducted from the cash surrender value or the death benefit prior to settlement of the insurance policy.
Other investments primarily consist of investments in private equity partnerships and joint ventures, hedge funds, real estate investments, derivative instruments, equity securities, trading securities, securities of consolidated investment funds that operate under the Investment Company Act of 1940 (40 Act Funds), and working capital finance investments (WCFI). Investments in private equity partnerships, joint venture interests and hedge funds are recorded under either the equity method of accounting or at fair value using the net asset value (NAV) per share practical expedient. The income and changes in fair value for these investments are recorded in net investment income. Trading securities, equity securities and the securities of the 40 Act Funds are reported at fair value with changes in fair value recognized in net realized investment gain (loss). WCFIs are held at accreted book value, which approximates fair value due to the short-term nature of the investment.
Real estate investments are carried at depreciated cost, net of write-downs. For real estate acquired in satisfaction of debt, cost represents fair value at the date of acquisition. Depreciation of investment real estate is computed using the straight-line method over estimated useful lives, which range from five to 30 years, and is included in net investment income. Real estate investments are evaluated for impairment based on the future estimated undiscounted cash flows expected to be received during the estimated holding period. When the future estimated undiscounted cash flows are less than the current carrying amount of the property (gross cost less accumulated depreciation), the property is considered not recoverable and an impairment loss is recognized as the amount by which the real estate carrying value exceeds its fair value.
All derivatives, whether designated in a hedging relationship or not, are required to be recorded at fair value. Prior to the adoption of Accounting Standards Update (ASU) 2017-12, if the derivative was designated as a cash flow hedge, the effective portion of changes in the fair value of the derivative was recorded in OCI and reclassified to earnings when the hedged item affected earnings, and the ineffective portion of changes in the fair value of the derivative was recognized in net realized investment gain (loss). Effective January 1, 2019, the Company adopted ASU 2017-12 which no longer requires the Company to bifurcate the ineffective portion for cash flow hedges. If the derivative is designated as a fair value hedge, changes in the fair value of the hedging derivative, including amounts measured as ineffectiveness, and changes in the fair value of the hedged item related to the designated risk being hedged, are reported in net realized investment gain (loss). The change in value of the hedged item associated with the risk being hedged is reflected as an adjustment to the carrying amount of the hedged item. For derivative instruments not designated as a hedge, the entire change in fair value of the derivative is recorded in net realized investment gain (loss).
The periodic cash flows for all derivatives designated as a hedge are recorded consistent with the hedged item on an accrual basis. For derivatives that are hedging investments, these amounts are included in net investment income. For derivatives that are hedging liabilities, these amounts are included in interest credited to policyholder account balances or interest expense, which is included in operating and other expenses. For derivatives not designated as a hedge, the periodic cash flows are reflected in net realized investment gain (loss) on an accrual basis. Upon termination of a cash flow hedging relationship, the accumulated amount in OCI is reclassified into earnings into either net investment income, net realized investment gain (loss), or interest credited to policyholder account balances when the forecasted transactions affect earnings. Upon termination of a fair value hedging relationship, the accumulated adjustment to the carrying amount of the hedged item is amortized into either net investment income, interest credited to policyholder account balances, or operating and other expenses over its remaining life.
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH
Cash and cash equivalents include all short-term, highly liquid investments with a maturity of three months or less from purchase date. Cash equivalents consist primarily of U.S. Treasury bills and money market securities. Restricted cash primarily consists of liquidity reserves related to security deposits, commitment fees, cash collateral, cash held in trusts, and property tax impounds. Restricted cash was $16 million and $14 million as of December 31, 2020 and 2019, respectively.
DEFERRED POLICY ACQUISITION COSTS
The direct and incremental costs associated with the successful acquisition of new or renewal insurance business; principally commissions, medical examinations, underwriting, policy issue and other expenses; are deferred and recorded as an asset referred to as DAC. DAC related to internally replaced contracts is immediately written off to expense and any new deferrable expenses associated with the replacement are deferred if the contract modification substantially changes the contract. However, if the contract modification does not substantially change the contract, the existing DAC asset remains in place and any acquisition costs associated with the modification are immediately expensed. The Company defers sales inducements and amortizes them over the life of the policy using the same methodology and assumptions used to amortize DAC. The nature of sales inducements include bonus credits equal to a certain percentage of each deposit.
For universal life (UL), variable annuities, and other investment-type contracts, acquisition costs are generally amortized through earnings in proportion to the present value of estimated gross profits (EGPs) from projected investment, mortality and expense margins, and surrender charges over the estimated lives of the contracts. Actual gross margins or profits may vary from management’s estimates, which can increase or decrease the rate of DAC amortization. DAC related to traditional policies is amortized through earnings over the premium-paying period of the related policies in proportion to premium revenues recognized, using assumptions and estimates consistent with those used in computing policy reserves. DAC related to certain unrealized components in OCI, primarily unrealized gains and losses on securities available for sale, is adjusted with corresponding charges or benefits, respectively, directly to equity through OCI.
During reporting periods of negative actual gross profits, DAC amortization may be negative, which would result in an increase to the DAC balance. Negative amortization is only recorded when the increased DAC balance is determined to be recoverable and is also limited to amounts originally deferred plus interest.
Significant assumptions in the development of EGPs include investment returns, surrender and lapse rates, rider utilization, expenses, interest spreads, and mortality margins. The Company’s long-term assumption for the underlying separate account investment return ranges from 6.75% to 7.25% depending on the product. A change in the assumptions utilized to develop EGPs results in a change to amounts expensed in the reporting period in which the change was made by adjusting the DAC balance to the level DAC would have been had the EGPs been calculated using the new assumptions over the entire amortization period. In general, favorable experience variances result in increased expected future profitability and may lower the rate of DAC amortization, whereas unfavorable experience variances result in decreased expected future profitability and may increase the rate of DAC amortization. All critical assumptions utilized to develop EGPs are evaluated at least annually and necessary revisions are made to certain assumptions to the extent that actual or anticipated experience necessitates such a prospective change. The Company may also identify and implement actuarial modeling refinements to projection models that may result in increases or decreases to the DAC asset.
The DAC asset is reviewed at least annually to ensure that the unamortized balance does not exceed expected recoverable EGPs.
CLOSED BLOCK
In connection with the Company’s conversion to a mutual holding company structure, an arrangement known as a closed block (the Closed Block) was created for the exclusive benefit of certain individual life insurance policies that had an experience based dividend scale in 1997. The Closed Block was designed to give reasonable assurance to holders of the Closed Block policies that policy dividends would not change.
Assets that support the Closed Block, which are primarily included in fixed maturity securities and policy loans, amounted to $231 million and $238 million as of December 31, 2020 and 2019, respectively. Liabilities allocated to the Closed Block, which are primarily included in future policy benefits, amounted to $235 million and $241 million as of December 31, 2020 and 2019, respectively. The net contribution to income from the Closed Block was ($1) million, $1 million, and zero for the years ended December 31, 2020, 2019, and 2018, respectively. As of December 31, 2020 and 2019, participating experience rated policies paying dividends represent less than 1% of direct life insurance in force.
GOODWILL
Goodwill represents the excess of acquisition costs over the fair value of net assets acquired. Goodwill is not amortized but is reviewed for impairment at least annually or more frequently if events occur or circumstances indicate that the goodwill might be impaired. Goodwill is included in other assets and was $15 million and $35 million as of December 31, 2020 and 2019, respectively. During the year ended December 31, 2020, a goodwill impairment of $20 million was recorded in operating and other expenses. There were no goodwill impairments recognized during the years ended December 31, 2019 and 2018.
POLICYHOLDER ACCOUNT BALANCES
Policyholder account balances relate to UL and investment-type contracts. UL and interest-sensitive whole life (ISWL) contracts are valued using the retrospective deposit method and are equal to accumulated account values, which consist of deposits received, plus interest credited, less withdrawals and assessments. Annuity and deposit liabilities include fixed annuities, structured settlements and other payout annuities without life contingencies which are valued using a prospective method that estimates the present value of future contract cash flows at the assumed credited or contract rate. Funding agreement account balances are calculated using the deposits received, plus interest credited, less withdrawals. Interest credited to these account balances vary by product and ranged from 0.0% to 8.6%. The fixed indexed annuity and life indexed account products contain embedded derivatives (Note 7), which are carried at fair value and are presented separate from the related host and other fixed components in Note 8.
FUTURE POLICY BENEFITS
Annuity reserves, which primarily consist of group retirement, structured settlement and certain immediate annuities with life contingencies, are equal to the present value of estimated future payments using pricing assumptions, as applicable, for interest rates, mortality, morbidity, retirement age, and expenses. Interest rates used in establishing such liabilities ranged from 0.4% to 11.0%. Assumptions such as mortality and interest rates are “locked in” upon the issuance of new business. Although certain assumptions are “locked-in”, significant changes in experience or assumptions may require us to provide for expected future losses on a product by establishing premium deficiency reserves. Premium deficiency reserves are determined based on best estimate assumptions that exist at the time the premium deficiency reserve is established and do not include a provision for adverse deviation. Any adjustments to future policy benefit reserves related to net unrealized gains on securities classified as available for sale are included in accumulated other comprehensive income (AOCI).
The liability for future policy benefits includes a liability for unpaid claims, established based on the Company’s estimated cost of settling all claims. Unpaid claims include estimates of claims that the Company believes have been incurred but have not yet been reported as of the balance sheet date. The estimates used to determine the liability for unpaid claims are derived principally from the Company’s historical experience.
The Company offers annuity contracts with guaranteed minimum benefits, including guaranteed minimum death benefits (GMDBs) and riders with guaranteed living benefits (GLBs) that guarantee net principal over a ten-year holding period or a minimum withdrawal benefit over specified periods, subject to certain restrictions. If the guarantee includes a benefit that is only attainable upon annuitization or is wholly life contingent (e.g., GMDBs or guaranteed minimum withdrawal benefits for life), it is accounted for as an insurance liability (Note 9). All other GLB guarantees are accounted for as embedded derivatives (Note 7).
Policy charges assessed against policyholders that represent compensation to the Company for services to be provided in future periods, or for consideration for origination of the contract, are deferred as unearned revenue reserves (URR), and recognized in revenue over the expected life of the contract using the same methods and assumptions used to amortize DAC. Unearned revenue related to certain unrealized components in OCI, primarily unrealized gains and losses on securities available for sale, is recorded to equity through OCI.
Life insurance reserves are composed of benefit reserves and additional liabilities. Benefit reserves are valued using the net level premium method on the basis of actuarial assumptions appropriate at policy issue. Mortality and persistency assumptions are generally based on the Company’s experience, which, together with interest and expense assumptions, include a margin for possible unfavorable deviations. Interest rate assumptions ranged from 1.0% to 9.3%. Future dividends for participating business are provided for in the liability for future policy benefits. Additional liabilities are held for certain insurance benefit features that have amounts assessed in a manner that is expected to result in profits in earlier years and subsequent losses. The additional liability is valued using a range of scenarios, rather than a single set of best estimate assumptions, which are consistent with assumptions used in estimated gross profits for purposes of amortizing capitalized DAC.
Estimates of future policy benefit reserves and liabilities are continually reviewed and, as experience develops, are adjusted as necessary. The Company may also identify and implement actuarial modeling refinements to projection models that may result in increases and decreases to the liability for future policy benefits. Such changes in estimates are included in earnings for the period in which such changes occur.
REINSURANCE
The Company has ceded reinsurance agreements with other insurance companies to limit potential losses, reduce exposure arising from larger risks, and provide additional capacity for future growth. As part of a strategic alliance, the Company also reinsures risks associated with policies written by an independent producer group through modified coinsurance and yearly renewable term (YRT) arrangements with this producer group’s reinsurance company. The ceding of risk does not discharge the Company from its primary obligations to contract owners. To the extent that the assuming companies become unable to meet their obligations under reinsurance contracts, the Company remains liable. The Company evaluates the financial strength and stability of each reinsurer prior to entering into each reinsurance contract and throughout the period that the reinsurance contract is in place.
All assets associated with business reinsured on a modified coinsurance basis remain with, and under the control of, the Company. As part of its risk management process, the Company routinely evaluates its reinsurance programs and may change retention limits, reinsurers or other features at any time.
The Company has assumed reinsurance agreements with other insurance companies, which primarily include traditional life reinsurance and non-traditional longevity reinsurance. Reinsurance agreements related to non-traditional longevity reinsurance are assumed from Pacific Life Re Limited (PLRL), an affiliate of the Company and a wholly owned subsidiary of Pacific LifeCorp. PLRL is incorporated in the United Kingdom (UK) and provides reinsurance to insurance and annuity providers in the UK, Ireland, Australia and to insurers in select markets in Asia. Non-traditional longevity reinsurance provides protection to retirement plans and insurers of such plans against changes in mortality improvement. With a non-traditional longevity reinsurance transaction, the Company agrees with another party to exchange a predefined benefit and the realized benefit for a premium.
The Company utilizes reinsurance accounting for ceded and assumed transactions when risk transfer provisions have been met. To meet risk transfer requirements, a reinsurance contract must include insurance risk, consisting of both underwriting and timing risk, and a reasonable possibility of a significant loss to the reinsurer.
Reinsurance premiums ceded and reinsurance recoveries on benefits and claims incurred are deducted from their respective revenue, benefit and expense accounts. Prepaid reinsurance premiums, included in other assets, are premiums that are paid in advance for future coverage. Amounts receivable and payable to reinsurers are offset for account settlement purposes for contracts where the right of offset exists, with net reinsurance receivables included in other assets and net reinsurance payables included in other liabilities. Reinsurance receivables and payables may include balances due from reinsurance companies for paid and unpaid losses. Reinsurance terminations and recapture gains are recorded in other income.
REVENUES, BENEFITS AND EXPENSES
Premiums from annuity contracts with life contingencies and traditional life and term insurance contracts are recognized as revenue when due. Benefits and expenses are provided against such revenues to recognize profits over the estimated lives of the contracts by providing for liabilities for future policy benefits, expenses for contract administration, and DAC amortization.
Receipts for UL and investment-type contracts are reported as deposits to either policyholder account balances or separate account liabilities and are not included in revenue. Policy fees consist of mortality charges, surrender charges and expense charges that have been earned and assessed against related account values during the period and also include the amortization of URR. The timing of policy fee revenue recognition is determined based on the nature of the fees. Benefits and expenses include policy benefits and claims incurred in the period that are in excess of related policyholder account balances, interest credited to policyholder account balances, expenses of contract administration, and the amortization of DAC.
The Company generates the majority of its revenues and net income from customers located in the U.S. As of December 31, 2020 and 2019, the Company had foreign investments of $17.9 billion and $15.4 billion, respectively. Revenues derived from any customer did not exceed 10% of consolidated total revenues for the years ended December 31, 2020, 2019, and 2018.
Investment advisory fees are primarily fees earned by Pacific Life Fund Advisors LLC (PLFA), a wholly owned subsidiary of Pacific Life, which serves as the investment advisor for the Pacific Select Fund (PSF), an investment vehicle provided to the Company’s variable universal life (VUL) and variable annuity contract holders, the Pacific Funds Series Trust, the investment vehicle for the Company’s mutual fund products and other funds, and the Pacific Life Investment Grade Trade Receivable Fund. These fees are based upon the NAV of the underlying portfolios and are recorded as earned. Related subadvisory expense is included in operating and other expenses.
INCOME TAXES
The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the consolidated financial statements. Under this method, the Company determines deferred tax assets and liabilities on the basis of the differences between the consolidated financial statement and tax bases of assets and liabilities by using enacted tax rates in effect for the year in which the differences are expected to reverse.
The Company recognizes deferred tax assets to the extent that these assets are more likely than not to be realized.
The Company records uncertain tax positions in accordance with the Accounting Standards Codification’s (Codification) Income Taxes Topic on the basis of a two-step process in which (1) the Company determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, the Company recognizes the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority.
The Company recognizes interest and penalties related to unrecognized tax benefits in the provision (benefit) for income taxes in the consolidated statements of operations. Accrued interest and penalties are included in other liabilities in the consolidated statements of financial condition. Immaterial amounts of interest and penalties were recognized in the years ended December 31, 2020, 2019, and 2018.
The Company accounts for investment tax credits using the deferral method of accounting.
The Company is accounting for the taxes due on future U.S. inclusions in taxable income related to global intangible low-taxed income as a current period expense when incurred (i.e., using the period cost method).
Pacific Life and its includable subsidiaries are included in the consolidated Federal income tax return and the combined California franchise tax return of PMHC and are allocated tax expense or benefit based principally on the effect of including their operations in these returns under a tax sharing agreement. Certain of the Company’s non-insurance subsidiaries also file separate state tax returns, if necessary.
The Coronavirus Aid, Relief, and Economic Security (CARES) Act, enacted on March 27, 2020, contains certain income tax related provisions. One of the key provisions allows companies with net operating losses (NOL) originating in 2018, 2019, or 2020 to carry back losses to the five preceding tax years and recover cash taxes paid in those years. The Company recorded a benefit for the expected carryback of 2020 NOL to the five preceding tax years from 2015 to 2019, some of which were at a higher statutory tax rate than the current year. See Note 14.
CONTINGENCIES
The Company evaluates all identified contingent matters on an individual basis. A loss is recorded if the contingent matter is probable of occurring and reasonably estimable. The Company establishes reserves for these contingencies at the best estimate, or, if no one amount within the range of possible losses is more probable than any other, the Company records an estimated reserve at the low end of the range of losses.
SEPARATE ACCOUNTS
Separate accounts primarily include variable annuity and variable life contracts, as well as other guaranteed and non-guaranteed accounts. Separate account assets are recorded at fair value and represent legally segregated contract holder funds. A separate account liability is recorded equal to the amount of separate account assets. Deposits to separate accounts, investment income, and realized and unrealized gains and losses on the separate account assets accrue directly to contract holders and, accordingly, are not reflected in the consolidated statements of operations or cash flows. Amounts charged to the separate account for mortality, surrender, and expense charges are included in revenues as policy fees.
FAIR VALUE OF FINANCIAL INSTRUMENTS
The fair value of financial instruments has been determined using available market information and appropriate valuation methodologies. However, considerable judgment is often required to interpret market data used to develop the estimates of fair value. Accordingly, the estimates presented may not be indicative of the amounts the Company could realize in a current market exchange. The use of different market assumptions and/or estimation methodologies could have a material effect on the fair value of the financial instruments. See Note 11.
RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS
In 2016, the Financial Accounting Standards Board (FASB) issued ASU 2016-01 that amends certain aspects of recognition, measurement, presentation and disclosure of financial instruments. The new guidance changes the current accounting guidance related to (i) the classification and measurement of certain equity investments, (ii) the presentation of changes in the fair value of financial liabilities measured under the fair value option that are due to instrument-specific credit risk, and (iii) certain disclosures associated with the fair value of financial instruments. The new guidance most significantly impacts equity interests in limited partnership interests and joint ventures currently accounted for under the cost method which are now measured at fair value utilizing the NAV practical expedient in the Codification’s Financial Services - Investment Companies Topic. Additionally, due to the elimination of historical classification guidance for equity securities (i.e., trading, available for sale), equity securities historically classified as trading and equity securities historically classified as available for sale all are now presented together as equity securities included in other investments and measured at fair value through net income. The Company adopted this ASU on January 1, 2018 applying the modified retrospective approach. The impact of this adoption on January 1, 2018 was an increase of $29 million to beginning retained earnings and a reduction of $3 million to AOCI. See the consolidated statements of equity and Note 12.
FUTURE ADOPTION OF ACCOUNTING PRONOUNCEMENTS
In March 2020, the FASB issued ASU 2020-04, which together with all subsequent amendments, provides guidance on facilitation of the effects of reference rate reform on financial reporting. The new guidance provides optional expedients and exceptions for applying U.S. GAAP to contracts, hedging relationships and other transactions affected by reference rate reform. If certain criteria are met, an entity will not be required to remeasure or reassess certain contract modifications that result from the discontinuation of the London Inter-Bank Offered Rate (LIBOR) or another reference rate. Changes to the critical terms of a hedging relationship affected by reference rate reform will not require entities to de-designate the relationship if certain criteria are met. Optional expedients also allow derivative instruments impacted by changes in the interest rate used for margining, discounting, or contract price alignment to qualify for certain optional relief. This standard may be elected and applied to contract modifications made between March 12, 2020 through December 31, 2022. The Company is currently evaluating the impact of this guidance on its consolidated financial statements.
In 2018, the FASB issued targeted improvements to the accounting for long-duration insurance contracts, ASU 2018-12. The objective of this guidance is to make improvements to the existing recognition, measurement, presentation, and disclosure requirements for long-duration contracts issued by an insurance entity. The new guidance improves the timeliness of recognizing changes in the liability for future policy benefits for traditional long-duration contracts by requiring that underlying cash flow assumptions be reviewed and updated at least annually. The rate used to discount future cash flows must be based on an upper-medium grade fixed income investment yield. The change in the reserve estimate as a result of updating cash flow assumptions will be recognized in net income. The change in the reserve estimate as a result of updating the discount rate assumption will be recognized in OCI. The new guidance also creates a new category of market risk benefits (i.e., features that protect the contract holder from more than nominal capital market risk) for certain guarantees associated with contracts which are required to be measured at fair value with changes recognized in net income. In addition, the new guidance simplifies the amortization of deferred policy acquisition costs and other similar capitalized balances (i.e., URR) by requiring such costs to be amortized on a constant-level basis that approximates the straight-line method. Lastly, the new guidance increases and enhances the disclosures related to long-duration insurance contracts. The new guidance is effective for fiscal years beginning after December 15, 2024 and interim periods within fiscal years beginning after December 15, 2025. Early adoption is permitted. The Company is currently evaluating the impact of this guidance on its consolidated financial statements.
In 2016, the FASB issued ASU 2016-13 that provides guidance on the measurement of credit losses for certain financial assets. This ASU replaces the incurred loss impairment methodology with one that reflects expected credit losses. The measurement of expected credit losses should be based on historical loss information, current conditions, and reasonable and supportable forecasts. The guidance also requires enhanced disclosures. This ASU is effective for fiscal years beginning after December 15, 2022 and interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the impact of this guidance on its consolidated financial statements.
In 2016, the FASB issued ASU 2016-02 that provides guidance on leasing transactions. The new guidance requires a lessee to recognize assets and liabilities for leases with lease terms of more than 12 months. Consistent with current guidance, leases would be classified as finance or operating leases. However, unlike current guidance, the new guidance will require both types of leases to be recognized on the consolidated statements of financial condition by the lessee. Lessor accounting will remain largely unchanged from current guidance except for certain targeted changes. This ASU is effective for fiscal years beginning after December 15, 2020 and interim periods within fiscal years beginning after December 15, 2021, and permits a modified retrospective transition approach which includes a number of optional practical expedients. Adoption of this standard on January 1, 2021 will not have a material impact on the Company’s consolidated financial statements.
2. STATUTORY FINANCIAL INFORMATION AND DIVIDEND RESTRICTIONS
STATUTORY ACCOUNTING PRACTICES
Pacific Life prepares its regulatory financial statements in accordance with statutory accounting practices prescribed or permitted by the NE DOI, which is a comprehensive basis of accounting other than U.S. GAAP. Statutory accounting practices primarily differ from U.S. GAAP by charging policy acquisition costs to expense as incurred, recognizing certain policy fees as revenue when billed, establishing future policy benefit liabilities using different actuarial assumptions, reporting surplus notes as surplus instead of debt, as well as the valuation of investments and certain assets, and accounting for deferred income taxes on a different basis.
STATUTORY NET INCOME (LOSS) AND SURPLUS
Statutory net income (loss) of Pacific Life was ($99) million, $1,716 million, and $869 million for the years ended December 31, 2020, 2019, and 2018, respectively. Statutory capital and surplus of Pacific Life was $11,364 million and $10,510 million as of December 31, 2020 and 2019, respectively.
AFFILIATED REINSURANCE
Pacific Life cedes certain statutory reserves to affiliated special purpose financial insurance companies and affiliated captive reinsurance companies that are supported by a combination of cash, invested and other assets, and third party excess of loss reinsurance agreement or note facilities. As of December 31, 2020, Pacific Life’s total statutory reserve credit was $2,828 million, of which $1,480 million was supported by third party excess of loss reinsurance agreement and note facilities. As of December 31, 2019, Pacific Life’s total statutory reserve credit was $2,590 million, of which $1,644 million was supported by third party letters of credit and note facilities, as described below.
Pacific Life utilizes affiliated reinsurers to mitigate the statutory capital impact of National Association of Insurance Commissioners (NAIC) Model Regulation “Valuation of Life Insurance Policies” (Regulation XXX) and NAIC Actuarial Guideline 38 on the Company’s UL products with flexible duration no lapse guarantee rider (FDNLGR) benefits. Pacific Alliance Reinsurance Company of Vermont (PAR Vermont) and Pacific Baleine Reinsurance Company (PBRC) are Vermont based special purpose financial insurance companies subject to regulatory supervision by the Vermont Department of Financial Regulation (Vermont Department). PAR Vermont and PBRC are wholly owned subsidiaries of Pacific Life and accredited authorized reinsurers in Nebraska. Pacific Life cedes certain level term life insurance to PBRC and FDNLGR benefits to PAR Vermont and PBRC. Economic reserves, as defined in the PAR Vermont and PBRC reinsurance agreements, are supported by cash and invested and other assets, including funds withheld at Pacific Life.
Effective December 1, 2019, PAR Vermont entered into a 25 year excess of loss reinsurance agreement (XOL Agreement) with an unrelated third party for a maximum amount of $1.5 billion with an expiration date of December 1, 2044. The XOL Agreement is non-recourse to Pacific LifeCorp or any of its affiliates, other than PAR Vermont. The XOL Agreement has been approved as an admissible asset in the amount of the XOL asset value as calculated in accordance with the XOL Agreement by the Vermont Department for PAR Vermont statutory accounting. As of December 31, 2020 and 2019, the XOL asset value was $627 million and $814 million, respectively. PAR Vermont admitted $627 million and $814 million as assets in its statutory financial statements as of December 31, 2020 and 2019, respectively.
Reserves in excess of the economic reserves held at PBRC are supported by a note facility with a maximum commitment amount of $1.6 billion. This facility is non-recourse to Pacific Life or any of its affiliates, other than PBRC. Through this facility, PBRC issued a surplus note with a maturity date of December 2046 and received a promissory note in return with a maturity date of December 2041. The promissory note is credit enhanced by a highly rated third-party reinsurer for 22 years with a three year extension. The promissory note has been approved as an admissible asset by the Vermont Department for PBRC statutory accounting. As of December 31, 2020 and 2019, the promissory note amounted to $525 million and $479 million, respectively, and was held in a trust with Pacific Life as beneficiary. PBRC admitted $525 million and $479 million as an asset in its statutory financial statements as of December 31, 2020 and 2019, respectively.
Pacific Life Re Global Limited (RGBM) (formerly referred to as PLRG) became an indirect, wholly owned subsidiary of Pacific LifeCorp, on March 31, 2020, when Pacific Life Reinsurance (Barbados) Limited, a direct, wholly owned subsidiary of Pacific LifeCorp, was redomiciled to Bermuda. RGBM assumes U.S. life retrocession business through Pacific Life, as well as other non-U.S. life retrocession business. Pacific Life has reinsurance agreements with RGBM. The underlying reinsurance is comprised of coinsurance and YRT treaties. Pacific Life retrocedes the majority of the underlying YRT U.S. treaties on a 100% coinsurance with funds withheld basis to RGBM (RGBM Agreement). The RGBM Agreement is accounted for under deposit accounting for U.S. GAAP and as reinsurance under statutory accounting principles. The statutory accounting reserve credit is supported by a $345 million letter of credit issued to RGBM by a highly rated bank for the benefit of Pacific Life, which expires August 2021. In connection with the letter of credit, Pacific LifeCorp has provided a guarantee to the bank for certain obligations under the letter of credit agreement. In addition, Pacific LifeCorp entered into a capital maintenance agreement with RGBM.
Pacific Annuity Reinsurance Company (PARC) was a captive reinsurance company subject to regulatory supervision by the Arizona Department of Insurance and Financial Institutions (AZ DIFI) and wholly owned by Pacific LifeCorp. PARC was formed to reinsure benefits provided by variable annuity contracts and contract rider guarantees issued by Pacific Life. Base annuity contracts were reinsured on a modified coinsurance basis and the contract guarantees were reinsured on a coinsurance with funds withheld basis. In October 2020, Pacific Life recaptured the variable annuity business reinsured by PARC and PARC was dissolved as of December 31, 2020. The recapture did not have a material impact on the Company’s consolidated financial statements.
RISK-BASED CAPITAL
Risk-based capital is a method developed by the NAIC to measure the minimum amount of capital appropriate for an insurance company to support its overall business operations in consideration of its size and risk profile. The formulas for determining the amount of risk-based capital specify various weighting factors that are applied to financial balances or various levels of activity based on the perceived degree of risk. Additionally, certain risks are required to be measured using actuarial cash flow modeling techniques, subject to formulaic minimums. The adequacy of a company’s actual capital is measured by a comparison to the risk-based capital results. Companies below minimum risk-based capital requirements are classified within certain levels, each of which requires specified corrective action. As of December 31, 2020 and 2019, Pacific Life, Pacific Life & Annuity Company (PL&A), an Arizona domiciled life insurance company wholly owned by Pacific Life, PAR Vermont, and PBRC all exceeded the minimum risk-based capital requirements.
DIVIDEND RESTRICTIONS AND CAPITAL CONTRIBUTIONS
The payment of dividends by Pacific Life to Pacific LifeCorp is subject to restrictions set forth in the State of Nebraska insurance laws. These laws require (i) notification to the NE DOI for the declaration and payment of any dividend and (ii) approval by the NE DOI for accumulated dividends within the preceding twelve months that exceed the greater of 10% of statutory policyholder surplus as of the preceding December 31 or statutory net gain from operations for the preceding twelve months ended December 31. Generally, these restrictions pose no short-term liquidity concerns for Pacific LifeCorp. Based on these restrictions and 2020 statutory results, Pacific Life could pay $769 million in dividends in 2021 to Pacific LifeCorp without prior approval from the NE DOI, subject to the notification requirement. During the years ended December 31, 2020, 2019, and 2018, Pacific Life paid dividends to Pacific LifeCorp of zero, $650 million, and zero, respectively.
The payment of dividends by PL&A to Pacific Life is subject to restrictions set forth in the State of Arizona insurance laws. These laws require (i) notification to the AZ DIFI for the declaration and payment of any dividend and (ii) approval by the AZ DIFI for accumulated dividends within the preceding twelve months that exceed the lesser of 10% of statutory surplus as regards to policyholders as of the preceding December 31 or statutory net gain from operations for the preceding twelve months ended December 31. Based on these restrictions and 2020 statutory results, PL&A could pay $42 million in dividends to Pacific Life in 2021 without prior regulatory approval, subject to the notification requirement. During the years ended December 31, 2020, 2019, and 2018, PL&A paid dividends to Pacific Life of $40 million, $41 million, and $40 million, respectively.
During the year ended December 31, 2020, Pacific LifeCorp made a capital contribution to Pacific Life of $650 million that is reported in additional paid-in capital.
3. VARIABLE INTEREST ENTITIES
The Company evaluates its interests in VIEs on an ongoing basis and consolidates those VIEs in which it has a controlling financial interest and is thus deemed to be the primary beneficiary. A controlling financial interest has both of the following characteristics: (i) the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance, and (ii) the obligation to absorb losses of the VIE that could potentially be significant to the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. Creditors or beneficial interest holders of VIEs, where the Company is the primary beneficiary, have no recourse against the Company in the event of default by these VIEs.
CONSOLIDATED VIEs
The following table presents, as of December 31, 2020 and 2019, the assets and liabilities, which the Company has consolidated because it is the primary beneficiary:
|
|
Assets |
|
Liabilities |
| ||
|
|
(In Millions) |
| ||||
|
|
|
|
| |||
Commercial mortgage-backed security trusts |
|
$ |
2,056 |
|
$ |
1,690 |
|
CLO |
|
1,001 |
|
930 |
| ||
Sponsored investment funds |
|
1,186 |
|
187 |
| ||
Other |
|
38 |
|
|
| ||
Total |
|
$ |
4,281 |
|
$ |
2,807 |
|
|
|
|
|
|
| ||
|
|
|
|
| |||
Commercial mortgage-backed security trusts |
|
$ |
1,805 |
|
$ |
1,525 |
|
CLO |
|
1,023 |
|
940 |
| ||
Sponsored investment funds |
|
767 |
|
113 |
| ||
Other |
|
22 |
|
|
| ||
Total |
|
$ |
3,617 |
|
$ |
2,578 |
|
COMMERCIAL MORTGAGE-BACKED SECURITY TRUSTS
The Company has purchased significant interests in multiple commercial mortgage-backed security trusts secured by commercial real estate properties (CMBS VIEs). The trusts are classified as VIEs as they have no equity investment at risk and while no future equity infusions should be required to permit the entities to continue their activities, accounting guidance requires trusts with no equity at risk to be classified as VIEs. The Company has determined that it is the primary beneficiary of the VIEs due to the significant control over the collateral the Company has in the event of a default. The assets of the CMBS VIEs can only be used to settle their respective liabilities, and the Company is not responsible for any principal or interest shortfalls. The Company’s exposure is limited to its investment of $365 million and $279 million as of December 31, 2020 and 2019, respectively. Non-recourse debt consolidated by the Company was $1,685 million and $1,521 million as of December 31, 2020 and 2019, respectively (included in CMBS VIE debt in Note 10).
CLO
The Company provides initial seed capital into sponsored CLO, which are classified as VIEs as they have insufficient equity investment at risk. The Company has determined that it is the primary beneficiary of these VIEs due to its significant control as the collateral manager. The Company has elected the FVO method of accounting for $963 million and $977 million of investments in the CLO as of December 31, 2020 and 2019, respectively. The Company has also elected the FVO method of accounting for $913 million and $910 million of debt issued from the CLO as of December 31, 2020 and 2019, respectively (included in FVO debt - VIE in Note 10).
SPONSORED INVESTMENT FUNDS
The Company has leveraged internal expertise to bring investment strategies/products to sophisticated institutional investors and qualified institutional buyers. Structured as limited partnerships, the Company has provided the initial investments to provide seed capital for these products for the purpose of refining the investment strategies and developing a performance history. Based on the design and operation of these entities, the Company concluded that they are subject to consolidation under the VIE rules and that the Company is the primary beneficiary. Short-term non-recourse debt consolidated by the Company was $187 million and $113 million as of December 31, 2020 and 2019, respectively (included in other VIE debt in Note 10). The lines of credit associated with this debt have a $245 million borrowing capacity. The Company’s unfunded commitment to the underlying investments of the limited partnerships was $1,042 million and $867 million as of December 31, 2020 and 2019, respectively.
NON-CONSOLIDATED VIEs
The following table presents the carrying amount and classification of the investments in VIEs in which the Company holds a variable interest but does not consolidate because it is not the primary beneficiary. The Company has determined that it is not the primary beneficiary of these VIEs because it does not have the power to direct their most significant activities. Also presented is the maximum exposure to loss which includes the carrying amount plus any unfunded commitments assuming the commitments are fully funded.
|
|
Carrying Amount |
|
Maximum |
| ||
|
|
(In Millions) |
| ||||
|
|
|
|
| |||
Private equity |
|
$ |
760 |
|
$ |
1,864 |
|
Other |
|
44 |
|
130 |
| ||
Total |
|
$ |
804 |
|
$ |
1,994 |
|
|
|
|
|
|
| ||
|
|
|
|
| |||
Private equity |
|
$ |
681 |
|
$ |
1,362 |
|
Other |
|
95 |
|
135 |
| ||
Total |
|
$ |
776 |
|
$ |
1,497 |
|
PRIVATE EQUITY
Private equity are limited partnership investment funds that are reported in other investments.
OTHER NON-CONSOLIDATED VIEs NOT INCLUDED IN THE TABLE ABOVE
As part of normal investment activities, the Company will make passive investments in structured securities for which it is not the sponsor. The structured security investments include residential mortgage-backed securities (RMBS), commercial mortgage-backed securities (CMBS), and other asset-backed securities which are reported in fixed maturity securities available for sale, at fair value. The Company has determined that it is not the primary beneficiary of these structured securities due to the fact that it does not control these entities. The Company’s maximum exposure to loss for these investments is limited to its carrying amount. See Note 5 for the net carrying amount and fair value of the structured security investments.
4. DEFERRED POLICY ACQUISITION COSTS
Components of DAC are as follows:
|
|
Years Ended December 31, |
| |||||||
|
|
|
2019 |
|
2018 |
| ||||
|
|
(In Millions) |
| |||||||
Balance, January 1 |
|
$ |
4,804 |
|
$ |
5,023 |
|
$ |
4,693 |
|
Additions: |
|
|
|
|
|
|
| |||
Capitalized during the year |
|
787 |
|
864 |
|
871 |
| |||
Amortization: |
|
|
|
|
|
|
| |||
Impact of assumption unlockings |
|
47 |
|
(51 |
) |
(38 |
) | |||
All other |
|
(365 |
) |
(441 |
) |
(846 |
) | |||
Total amortization |
|
(318 |
) |
(492 |
) |
(884 |
) | |||
Allocated to OCI |
|
(430 |
) |
(591 |
) |
343 |
| |||
Balance, December 31 |
|
$ |
4,843 |
|
$ |
4,804 |
|
$ |
5,023 |
|
Components of the capitalized sales inducement balance included in the DAC asset are as follows:
|
|
Years Ended December 31, |
| |||||||
|
|
|
2019 |
|
2018 |
| ||||
|
|
(In Millions) |
| |||||||
Balance, January 1 |
|
$ |
434 |
|
$ |
437 |
|
$ |
513 |
|
Deferred costs capitalized during the year |
|
8 |
|
6 |
|
9 |
| |||
Amortization of deferred costs |
|
17 |
|
(9 |
) |
(85 |
) | |||
Balance, December 31 |
|
$ |
459 |
|
$ |
434 |
|
$ |
437 |
|
5. INVESTMENTS
The net carrying amount, gross unrealized gains and losses, and fair value of fixed maturity securities available for sale are shown below. The net carrying amount represents amortized cost adjusted for OTTI losses recognized in earnings and fair value hedges (Note 7). See Note 11 for information on the Company’s fair value measurements and disclosure.
|
|
Net |
|
|
|
|
|
|
| ||||
|
|
Carrying |
|
Gross Unrealized |
|
|
| ||||||
|
|
Amount |
|
Gains |
|
Losses |
|
Fair Value |
| ||||
|
|
(In Millions) |
| ||||||||||
|
|
|
|
|
|
|
|
| |||||
U.S. Government |
|
$ |
55 |
|
$ |
11 |
|
|
|
$ |
66 |
| |
Obligations of states and political subdivisions |
|
2,019 |
|
343 |
|
$ |
2 |
|
2,360 |
| |||
Foreign governments |
|
627 |
|
92 |
|
|
|
719 |
| ||||
Corporate securities (1) |
|
53,698 |
|
8,071 |
|
91 |
|
61,678 |
| ||||
RMBS (2) |
|
3,053 |
|
99 |
|
8 |
|
3,144 |
| ||||
CMBS |
|
1,965 |
|
114 |
|
35 |
|
2,044 |
| ||||
Other asset-backed securities |
|
2,747 |
|
117 |
|
13 |
|
2,851 |
| ||||
Total fixed maturity securities |
|
$ |
64,164 |
|
$ |
8,847 |
|
$ |
149 |
|
$ |
72,862 |
|
|
|
Net |
|
|
|
|
|
|
| ||||
|
|
Carrying |
|
Gross Unrealized |
|
|
| ||||||
|
|
Amount |
|
Gains |
|
Losses |
|
Fair Value |
| ||||
|
|
(In Millions) |
| ||||||||||
|
|
|
|
|
|
|
|
| |||||
U.S. Government |
|
$ |
325 |
|
$ |
7 |
|
$ |
1 |
|
$ |
331 |
|
Obligations of states and political subdivisions |
|
1,432 |
|
233 |
|
1 |
|
1,664 |
| ||||
Foreign governments |
|
543 |
|
58 |
|
1 |
|
600 |
| ||||
Corporate securities (1) |
|
48,235 |
|
4,373 |
|
103 |
|
52,505 |
| ||||
RMBS (2) |
|
3,098 |
|
97 |
|
6 |
|
3,189 |
| ||||
CMBS |
|
1,689 |
|
66 |
|
4 |
|
1,751 |
| ||||
Other asset-backed securities |
|
1,702 |
|
70 |
|
6 |
|
1,766 |
| ||||
Total fixed maturity securities |
|
$ |
57,024 |
|
$ |
4,904 |
|
$ |
122 |
|
$ |
61,806 |
|
(1) Gross unrealized losses on investments for which OTTI has been recognized in earnings in current or prior periods, were $15 million and $1 million as of December 31, 2020 and 2019, respectively.
(2) Gross unrealized losses on investments for which OTTI has been recognized in earnings in current or prior periods, were $3 million and $2 million as of December 31, 2020 and 2019, respectively.
The net carrying amount and fair value of fixed maturity securities available for sale as of December 31, 2020, by contractual repayment date of principal, are shown below. Expected maturities may differ from contractual maturities as borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.
|
|
Net |
|
|
|
|
|
|
| ||||
|
|
Carrying |
|
Gross Unrealized |
|
|
| ||||||
|
|
Amount |
|
Gains |
|
Losses |
|
Fair Value |
| ||||
|
|
(In Millions) |
| ||||||||||
Due in one year or less |
|
$ |
1,483 |
|
$ |
39 |
|
$ |
4 |
|
$ |
1,518 |
|
Due after one year through five years |
|
13,807 |
|
1,185 |
|
30 |
|
14,962 |
| ||||
Due after five years through ten years |
|
21,541 |
|
2,768 |
|
26 |
|
24,283 |
| ||||
Due after ten years |
|
19,568 |
|
4,525 |
|
33 |
|
24,060 |
| ||||
|
|
56,399 |
|
8,517 |
|
93 |
|
64,823 |
| ||||
Mortgage-backed and asset-backed securities |
|
7,765 |
|
330 |
|
56 |
|
8,039 |
| ||||
Total fixed maturity securities |
|
$ |
64,164 |
|
$ |
8,847 |
|
$ |
149 |
|
$ |
72,862 |
|
The following tables present the fair value and gross unrealized losses on investments where the fair value has declined and remained continuously below the net carrying amount for less than twelve months and for twelve months or greater.
|
|
Less than 12 Months |
|
12 Months or Greater |
|
Total |
| ||||||||||||
|
|
Fair Value |
|
Gross |
|
Fair Value |
|
Gross |
|
Fair Value |
|
Gross |
| ||||||
|
|
(In Millions) |
| ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
Obligations of states and political subdivisions |
|
|
|
|
|
$ |
20 |
|
$ |
2 |
|
$ |
20 |
|
$ |
2 |
| ||
Corporate securities |
|
$ |
1,392 |
|
$ |
46 |
|
496 |
|
45 |
|
1,888 |
|
91 |
| ||||
RMBS |
|
563 |
|
4 |
|
69 |
|
4 |
|
632 |
|
8 |
| ||||||
CMBS |
|
564 |
|
30 |
|
67 |
|
5 |
|
631 |
|
35 |
| ||||||
Other asset-backed securities |
|
333 |
|
5 |
|
10 |
|
8 |
|
343 |
|
13 |
| ||||||
Total fixed maturity securities |
|
$ |
2,852 |
|
$ |
85 |
|
$ |
662 |
|
$ |
64 |
|
$ |
3,514 |
|
$ |
149 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
U.S. Government |
|
$ |
269 |
|
$ |
1 |
|
|
|
|
|
$ |
269 |
|
$ |
1 |
| ||
Obligations of states and political subdivisions |
|
|
|
|
|
$ |
22 |
|
$ |
1 |
|
22 |
|
1 |
| ||||
Foreign governments |
|
1 |
|
1 |
|
|
|
|
|
1 |
|
1 |
| ||||||
Corporate securities |
|
1,166 |
|
15 |
|
1,243 |
|
88 |
|
2,409 |
|
103 |
| ||||||
RMBS |
|
732 |
|
2 |
|
200 |
|
4 |
|
932 |
|
6 |
| ||||||
CMBS |
|
165 |
|
3 |
|
42 |
|
1 |
|
207 |
|
4 |
| ||||||
Other asset-backed securities |
|
254 |
|
2 |
|
39 |
|
4 |
|
293 |
|
6 |
| ||||||
Total fixed maturity securities |
|
$ |
2,587 |
|
$ |
24 |
|
$ |
1,546 |
|
$ |
98 |
|
$ |
4,133 |
|
$ |
122 |
|
The number of securities in an unrealized loss position for less than 12 months as of December 31, 2020 and 2019 were 310 and 319, respectively. The number of securities in an unrealized loss position for 12 months or greater as of December 31, 2020 and 2019 were 107 and 171, respectively.
The Company has evaluated fixed maturity securities available for sale with gross unrealized losses and has determined that the unrealized losses are temporary. The Company does not intend to sell the investments and it is more likely than not that the Company will not be required to sell the investments before recovery of their net carrying amounts.
The Company participates in a securities lending program administered by an authorized financial institution whereby certain investment securities are loaned to third parties. With respect to securities loaned, the Company requires initial cash collateral equal to a minimum of 102% of the fair value of domestic securities loaned. The Company monitors the fair value of securities loaned with additional collateral obtained as necessary. The borrower of the loaned securities is permitted to sell or repledge those securities. The Company may occasionally borrow amounts from the cash collateral for short-term liquidity. The utilization of the cash collateral is based on conservative forecasts of cash flows and is supported by the cash balance in the general account. As of December 31, 2020, borrowings from the securities lending cash collateral was zero. The gross carrying amounts are disclosed in the table below.
Upon default of the borrower, the Company has the right to purchase replacement securities using the cash collateral held. Similarly, upon default of the Company, the borrower has the right to sell the loaned securities and apply the proceeds from such sale to the Company’s obligation to return the cash collateral held. The Company has made an accounting policy election not to offset the loaned securities and cash collateral liabilities in its consolidated statements of financial condition.
The Company invests cash collateral received from its securities lending arrangements into repurchase agreements (reinvestment portfolio). The Company requires that all repurchase agreements must have a maximum maturity of 95 days and the interest rate must reset no more than monthly. All repurchase agreements must be collateralized by U.S. Treasury Securities, U.S. Agency Securities, U.S. Corporate bonds and/or U.S. Equities with a minimum margin of 102%. Equity repurchase agreements are only overnight and must be collateralized at 105%. Additionally, all repurchase agreements are indemnified by the Company’s securities lending agent against counterparty default. When counterparty default and price movements of the collateral received present the primary risks for repurchase agreements, the Company mitigates such risks by mandating short maturities, applying proper haircuts, monitoring fair values daily, and securing indemnification from financial institutions with strong financial credit ratings.
The following table presents the Company’s security loans outstanding, reinvestment portfolio and the corresponding collateral held:
|
|
| |||||
|
|
|
2019 |
| |||
|
|
(In Millions) |
| ||||
Security loans outstanding, fair value (1) |
|
$ |
2,601 |
|
$ |
2,058 |
|
Reinvestment portfolio, fair value (2) |
|
2,681 |
|
2,131 |
| ||
Cash collateral liability (3) |
|
2,681 |
|
2,131 |
| ||
(1) Included in fixed maturity securities available for sale, at fair value and comprised of corporate securities.
(2) Included in cash, cash equivalents, and restricted cash. The reinvestment portfolio remaining contractual maturities as of December 31, 2020 are $2,231 million, $200 million and $250 million maturing in 30 days or less, 31 to 60 days and 61 to 90 days, respectively.
(3) Included in other liabilities.
Major categories of investment income and related investment expense are summarized as follows:
|
|
Years Ended December 31, |
| |||||||
|
|
|
2019 |
|
2018 |
| ||||
|
|
(In Millions) |
| |||||||
Fixed maturity securities |
|
$ |
2,506 |
|
$ |
2,341 |
|
$ |
2,080 |
|
FVO securities |
|
52 |
|
74 |
|
52 |
| |||
Mortgage loans |
|
824 |
|
756 |
|
694 |
| |||
Real estate |
|
243 |
|
225 |
|
187 |
| |||
Policy loans |
|
218 |
|
218 |
|
216 |
| |||
Partnerships and joint ventures |
|
90 |
|
126 |
|
211 |
| |||
Other |
|
64 |
|
75 |
|
51 |
| |||
Gross investment income |
|
3,997 |
|
3,815 |
|
3,491 |
| |||
Investment expense |
|
319 |
|
301 |
|
248 |
| |||
Net investment income |
|
$ |
3,678 |
|
$ |
3,514 |
|
$ |
3,243 |
|
The components of net realized investment gain (loss) are as follows:
|
|
Years Ended December 31, |
| |||||||||
|
|
|
2019 |
|
2018 |
| ||||||
|
|
(In Millions) |
| |||||||||
Fixed maturity securities: |
|
|
|
|
|
|
| |||||
Gross gains on sales |
|
$ |
47 |
|
$ |
35 |
|
$ |
33 |
| ||
Gross losses on sales |
|
(16 |
) |
(30 |
) |
(36 |
) | |||||
Total fixed maturity securities |
|
31 |
|
5 |
|
(3 |
) | |||||
FVO and trading securities |
|
144 |
|
89 |
|
(38 |
) | |||||
Equity securities |
|
(8 |
) |
27 |
|
(21 |
) | |||||
Real estate |
|
18 |
|
79 |
|
|
| |||||
Equity total return swaps |
|
165 |
|
(275 |
) |
54 |
| |||||
Equity futures |
|
(1,156 |
) |
(33 |
) |
(3 |
) | |||||
Equity put options |
|
23 |
|
(54 |
) |
9 |
| |||||
Equity call options |
|
586 |
|
732 |
|
(256 |
) | |||||
Foreign currency and interest rate swaps |
|
129 |
|
57 |
|
16 |
| |||||
Synthetic guaranteed interest contract policy fees |
|
53 |
|
49 |
|
44 |
| |||||
Embedded derivatives: |
|
|
|
|
|
|
| |||||
Variable annuity GLB |
|
(353 |
) |
27 |
|
|
| |||||
Fixed indexed annuities |
|
(474 |
) |
(565 |
) |
44 |
| |||||
Life indexed accounts |
|
(341 |
) |
(520 |
) |
228 |
| |||||
Other |
|
(43 |
) |
(16 |
) |
(8 |
) | |||||
Other |
|
(2 |
) |
7 |
|
(6 |
) | |||||
Net realized investment gain (loss) |
|
$ |
(1,228 |
) |
$ |
(391 |
) |
$ |
60 |
| ||
The tables below summarize OTTI by investment type:
|
|
Recognized in |
|
Recognized in |
|
Total |
| ||
|
|
(In Millions) |
| ||||||
Year Ended December 31, 2020: |
|
|
|
|
|
|
| ||
Corporate securities |
|
$ |
61 |
|
|
|
$ |
61 |
|
OTTI - fixed maturity securities |
|
61 |
|
— |
|
61 |
| ||
Mortgage loans |
|
14 |
|
|
|
14 |
| ||
Real estate |
|
6 |
|
|
|
6 |
| ||
Total OTTI |
|
$ |
81 |
|
— |
|
$ |
81 |
|
|
|
|
|
|
|
|
| ||
Year Ended December 31, 2019: |
|
|
|
|
|
|
| ||
Corporate securities |
|
$ |
13 |
|
|
|
$ |
13 |
|
RMBS |
|
6 |
|
|
|
6 |
| ||
Total OTTI |
|
$ |
19 |
|
— |
|
$ |
19 |
|
|
|
|
|
|
|
|
| ||
Year Ended December 31, 2018: |
|
|
|
|
|
|
| ||
Corporate securities |
|
$ |
8 |
|
|
|
$ |
8 |
|
RMBS |
|
1 |
|
|
|
1 |
| ||
OTTI - fixed maturity securities |
|
9 |
|
— |
|
9 |
| ||
Real estate |
|
6 |
|
|
|
6 |
| ||
Total OTTI |
|
$ |
15 |
|
— |
|
$ |
15 |
|
The table below details the amount of OTTI attributable to credit losses recognized in earnings for which a portion was recognized in OCI:
|
|
Years Ended December 31, |
| ||||
|
|
|
2019 |
| |||
|
|
(In Millions) |
| ||||
Cumulative credit loss, January 1 |
|
$ |
91 |
|
$ |
164 |
|
Additions for credit impairments recognized on: |
|
|
|
|
| ||
Securities previously other than temporarily impaired |
|
|
|
6 |
| ||
Total additions |
|
— |
|
6 |
| ||
|
|
|
|
|
| ||
Reductions for credit impairments previously recognized on: |
|
|
|
|
| ||
Securities due to an increase in expected cash flows and time value of cash flows |
|
(1 |
) |
(1 |
) | ||
Securities sold |
|
|
|
(78 |
) | ||
Total subtractions |
|
(1 |
) |
(79 |
) | ||
Cumulative credit loss, December 31 |
|
$ |
90 |
|
$ |
91 |
|
Net unrealized gain (loss) recognized in the consolidated statements of operations during the periods presented on securities still held at each period end is as follows:
|
|
Years Ended December 31, |
| |||||||
|
|
|
2019 |
|
2018 |
| ||||
|
|
(In Millions) |
| |||||||
FVO securities |
|
$ |
105 |
|
$ |
77 |
|
$ |
(29 |
) |
Trading securities |
|
42 |
|
13 |
|
(10 |
) | |||
Equity securities |
|
1 |
|
9 |
|
(8 |
) | |||
Other investments measured at NAV |
|
46 |
|
29 |
|
35 |
| |||
The change in net unrealized gain (loss) in available for sale securities is as follows:
|
|
Years Ended December 31, |
| |||||||
|
|
|
2019 |
|
2018 |
| ||||
|
|
(In Millions) |
| |||||||
Fixed maturity securities |
|
$ |
3,793 |
|
$ |
4,698 |
|
$ |
(2,807 |
) |
Trading securities, included in other investments, totaled $818 million and $702 million as of December 31, 2020 and 2019, respectively. The cumulative net unrealized gain on trading securities as of December 31, 2020 and 2019 was $48 million and $10 million, respectively.
Mortgage loans are primarily collateralized by commercial properties mainly located throughout the U.S. The geographic distribution of mortgage loans for the top five states or federal districts is as follows:
|
|
| |||||
|
|
|
2019 |
| |||
|
|
(In Millions) |
| ||||
California |
|
$ |
3,273 |
|
$ |
2,942 |
|
Texas |
|
2,722 |
|
2,501 |
| ||
New York |
|
1,945 |
|
1,702 |
| ||
Washington |
|
1,232 |
|
1,298 |
| ||
Illinois |
|
1,159 |
|
1,127 |
| ||
Other |
|
7,511 |
|
6,818 |
| ||
Total mortgage loans |
|
$ |
17,842 |
|
$ |
16,388 |
|
Included in the December 31, 2020 and 2019 amounts for Texas are $1,050 million for both years and New York are $1,000 million and $750 million, respectively, consolidated from the CMBS VIEs (Note 3). Included in the December 31, 2020 amounts for Other in the table above are $283 million and $173 million located in Canada and the UK, respectively. Included in the December 31, 2019 amounts for Other in the table above are $288 million and $169 million located in Canada and the UK, respectively. The Company did not have any mortgage loans with accrued interest more than 180 days past due as of December 31, 2020 or 2019. As of December 31, 2020, there was no single mortgage loan investment that exceeded 10% of stockholder’s equity.
The Company reviews the performance and credit quality of the mortgage loan portfolio on an on-going basis, including loan payment and collateral performance. Collateral performance includes a review of the most recent collateral inspection reports and financial statements. Analysts track each loan’s debt service coverage ratio (DCR) and loan-to-value ratio (LTV). The DCR compares the collateral’s net operating income to its debt service payments. DCRs of less than 1.0 times indicate that the collateral operations do not generate enough income to cover the loan’s current debt payments. A larger DCR indicates a greater excess of net operating income over the debt service. The LTV compares the amount of the loan to the fair value of the collateral and is commonly expressed as a percentage. LTVs greater than 100% indicate that the loan amount exceeds the collateral value. A smaller LTV percentage indicates a greater excess of collateral value over the loan amount.
The loan review process will result in each loan being placed into a No Credit Concern category or one of three levels: Level 1 Minimal Credit Concern, Level 2 Moderate Credit Concern or Level 3 Significant Credit Concern. Loans in No Credit Concern category are performing and no issues are noted. The collateral exhibits a strong DCR and LTV and there are no near term maturity concerns. The loan credit profile and borrower sponsorship have not experienced any significant changes and remain strong. For construction loans, projects are progressing as planned with no significant cost overruns or delays.
Level 1 loans are experiencing negative market pressure and outlook due to economic factors. Financial covenants may have been triggered due to declines in performance. Credit profile and/or borrower sponsorship remain stable but require monitoring. Near term (6 months or less) maturity requires monitoring due to negative trends. No impairment loss concerns exist under current conditions, however some possibility of loss may exist under stressed scenarios or changes in sponsorship financial strength. Includes troubled debt restructures performing as agreed for more than one year.
Level 2 loans are experiencing significant or prolonged negative market pressure and uncertain outlook due to economic factors; financial covenants may have been triggered due to declines in performance and/or borrower may have requested covenant relief. Loan credit profile, borrower sponsorship and/or collateral value may have declined or give cause for concern. Near term maturity (12 months or less) coupled with negative market conditions, property performance and value and/or borrower stability result in increased refinance risk. Likelihood for troubled debt restructure, impairment and loss is increased. Includes all loans performing as agreed during the first year of a troubled debt restructure unless assigned to Level 3.
Level 3 loans are experiencing prolonged and/or severe negative market trends, declines in collateral performance and value, and/or borrower financial difficulties exist. Borrower may have asked for modification of loan terms. Without additional capital infusion and/or acceptable modification to existing loan terms, default is likely and foreclosure the probable alternative. Impairment loss is possible depending on current fair market value of the collateral. This category includes loans in default and previously impaired restructured loans that underperform despite modified terms and/or for which future loss is probable.
Loans classified as Level 2 or Level 3 are placed on a watch list and monitored monthly. Loans that have been identified as Level 3 are evaluated to determine if the loan is impaired. A loan is impaired if it is probable that amounts due according to the contractual terms of the loan agreement will not be collected.
As of December 31, 2020, there were two loans with a book value of $135 million that were considered impaired. For the year ended December 31, 2020, an impairment loss of $14 million was recognized on the first loan, as the fair value of the underlying collateral was lower than its carrying value. The book value after write down of the loan was $115 million. No impairment loss was recorded on the second loan since the fair value of the underlying collateral was higher than its carrying amount. As of December 31, 2019 and December 31, 2018, there were 3 and 11 loans with a book value of $45 million and $93 million, respectively, that were considered impaired. Since the fair value of the underlying collateral on these loans was greater than their carrying amount, no impairment loss was recorded.
The Company is working with borrowers who are experiencing financial difficulty as a direct result of the COVID-19 pandemic. When necessary, the Company is providing loan modifications to assist borrowers with their present circumstances. These loans are accruing interest and are classified as current when performing under the terms of the modified loan agreement. On April 7, 2020, a group of banking agencies issued an Interagency Statement that offers practical expedients for evaluating whether loan modifications that occur in response to COVID-19 are troubled debt restructures (TDR) consistent with the CARES Act. The Consolidated Appropriations Act, signed into law on December 27, 2020, extended the relief offered in the CARES Act and clarified that insurance companies are covered under the CARES Act. The Company’s loan modifications fall within the guidance of either the April 7, 2020 Interagency Statement (an approach that was concurred by the FASB) or the CARES Act and do not qualify as TDRs.
As of December 31, 2020, mortgage loans with a total book value of $421 million are in a forbearance period where the Company has provided modifications with principal and/or interest payment relief and these loans do not qualify as TDRs.
The following tables set forth mortgage loan credit levels as of December 31, 2020 and 2019 ($ In Millions):
|
|
| ||||||||||||||||||||||||
|
|
|
|
Level 1 |
|
Level 2 |
|
Level 3 |
|
|
| |||||||||||||||
|
|
No Credit Concern |
|
Minimal Credit Concern |
|
Moderate Credit Concern |
|
Significant Credit Concern |
|
Total |
| |||||||||||||||
|
|
|
|
Weighted |
|
|
|
Weighted |
|
|
|
Weighted |
|
|
|
Weighted |
|
|
|
Weighted |
| |||||
|
|
Carrying |
|
Average |
|
Carrying |
|
Average |
|
Carrying |
|
Average |
|
Carrying |
|
Average |
|
Carrying |
|
Average |
| |||||
Type |
|
Amount |
|
DCR |
|
Amount |
|
DCR |
|
Amount |
|
DCR |
|
Amount |
|
DCR |
|
Amount |
|
DCR |
| |||||
Agricultural |
|
$ |
754 |
|
2.25 |
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
754 |
|
2.25 |
| |||
Apartment |
|
1,441 |
|
1.55 |
|
$ |
262 |
|
1.18 |
|
|
|
|
|
|
|
|
|
1,703 |
|
1.49 |
| ||||
Golf course |
|
7 |
|
1.40 |
|
25 |
|
0.57 |
|
$ |
32 |
|
0.85 |
|
$ |
20 |
|
0.69 |
|
84 |
|
0.77 |
| |||
Industrial |
|
520 |
|
2.66 |
|
|
|
|
|
|
|
|
|
|
|
|
|
520 |
|
2.66 |
| |||||
Lodging |
|
266 |
|
1.49 |
|
672 |
|
0.27 |
|
372 |
|
(0.24 |
) |
337 |
|
(1.25 |
) |
1,647 |
|
0.04 |
| |||||
Mobile home park |
|
182 |
|
3.38 |
|
|
|
|
|
|
|
|
|
|
|
|
|
182 |
|
3.38 |
| |||||
Office |
|
3,963 |
|
1.95 |
|
626 |
|
2.17 |
|
|
|
|
|
20 |
|
0.62 |
|
4,609 |
|
1.98 |
| |||||
Office - VIE |
|
750 |
|
4.36 |
|
|
|
|
|
|
|
|
|
|
|
|
|
750 |
|
4.36 |
| |||||
Residential |
|
84 |
|
2.37 |
|
|
|
|
|
|
|
|
|
|
|
|
|
84 |
|
2.37 |
| |||||
Retail |
|
904 |
|
1.99 |
|
1,952 |
|
1.75 |
|
|
|
|
|
185 |
|
1.91 |
|
3,041 |
|
1.83 |
| |||||
Retail - VIE |
|
1,300 |
|
2.63 |
|
|
|
|
|
|
|
|
|
|
|
|
|
1,300 |
|
2.63 |
| |||||
Construction |
|
1,967 |
|
|
|
956 |
|
|
|
245 |
|
|
|
|
|
|
|
3,168 |
|
|
| |||||
Total |
|
$ |
12,138 |
|
2.24 |
|
$ |
4,493 |
|
1.49 |
|
$ |
649 |
|
(0.15 |
) |
$ |
562 |
|
(0.08 |
) |
$ |
17,842 |
|
1.90 |
|
|
|
| ||||||||||||||||||||||||
|
|
|
|
Level 1 |
|
Level 2 |
|
Level 3 |
|
|
| |||||||||||||||
|
|
No Credit Concern |
|
Minimal Credit Concern |
|
Moderate Credit Concern |
|
Significant Credit Concern |
|
Total |
| |||||||||||||||
|
|
|
|
Weighted |
|
|
|
Weighted |
|
|
|
Weighted |
|
|
|
Weighted |
|
|
|
Weighted |
| |||||
|
|
Carrying |
|
Average |
|
Carrying |
|
Average |
|
Carrying |
|
Average |
|
Carrying |
|
Average |
|
Carrying |
|
Average |
| |||||
Type |
|
Amount |
|
DCR |
|
Amount |
|
DCR |
|
Amount |
|
DCR |
|
Amount |
|
DCR |
|
Amount |
|
DCR |
| |||||
Agricultural |
|
$ |
534 |
|
2.28 |
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
534 |
|
2.28 |
| |||
Apartment |
|
1,681 |
|
1.57 |
|
$ |
124 |
|
0.97 |
|
|
|
|
|
|
|
|
|
1,805 |
|
1.53 |
| ||||
Golf course |
|
24 |
|
1.75 |
|
13 |
|
0.49 |
|
$ |
39 |
|
0.83 |
|
$ |
22 |
|
0.74 |
|
98 |
|
1.00 |
| |||
Industrial |
|
148 |
|
1.55 |
|
|
|
|
|
|
|
|
|
|
|
|
|
148 |
|
1.55 |
| |||||
Lodging |
|
1,493 |
|
2.40 |
|
166 |
|
1.47 |
|
|
|
|
|
|
|
|
|
1,659 |
|
2.30 |
| |||||
Mobile home park |
|
183 |
|
3.15 |
|
|
|
|
|
|
|
|
|
|
|
|
|
183 |
|
3.15 |
| |||||
Office |
|
4,223 |
|
1.91 |
|
78 |
|
2.07 |
|
|
|
|
|
21 |
|
0.47 |
|
4,322 |
|
1.91 |
| |||||
Office - VIE |
|
750 |
|
3.44 |
|
|
|
|
|
|
|
|
|
|
|
|
|
750 |
|
3.44 |
| |||||
Residential |
|
24 |
|
1.52 |
|
|
|
|
|
|
|
|
|
|
|
|
|
24 |
|
1.52 |
| |||||
Retail |
|
3,036 |
|
2.07 |
|
|
|
|
|
|
|
|
|
|
|
|
|
3,036 |
|
2.07 |
| |||||
Retail - VIE |
|
1,050 |
|
2.75 |
|
|
|
|
|
|
|
|
|
|
|
|
|
1,050 |
|
2.75 |
| |||||
Construction |
|
2,245 |
|
|
|
534 |
|
|
|
|
|
|
|
|
|
|
|
2,779 |
|
|
| |||||
Total |
|
$ |
15,391 |
|
2.14 |
|
$ |
915 |
|
1.40 |
|
$ |
39 |
|
0.83 |
|
$ |
43 |
|
0.61 |
|
$ |
16,388 |
|
2.11 |
|
Pacific Life is a member of the Federal Home Loan Bank (FHLB) of Topeka. As of December 31, 2020 and 2019, the Company has $102 million of funding agreements issued by the FHLB of Topeka. The funding agreement liabilities are included in policyholder account balances (Note 8). As of December 31, 2020 and 2019, mortgage loans with a fair value of $705 million and $277 million, respectively, are in a custodial account pledged as approved collateral for the funding agreements. The Company is required to purchase stock in FHLB of Topeka each time it receives an advance.
Real estate investments totaled $2,407 million and $2,285 million as of December 31, 2020 and 2019, respectively.
6. SALE OF AIRCRAFT LEASING BUSINESS
On December 5, 2019, the Company completed the sale of its ownership in Aviation Capital Group LLC (ACG) to TC Skyward Aviation U.S., Inc. As the sale of ACG represented a strategic shift that has a major effect on the Company’s operations and financial results, the Company’s aircraft leasing business has been classified as a discontinued operation within the consolidated financial statements for all periods presented.
Upon the closing of the transaction, the Company received cash proceeds of $3.0 billion, recorded a $25 million gain on sale of discontinued operations, net of taxes, and disposed of the Company’s aircraft leasing business.
As of December 31, 2020 and 2019, there were no assets or liabilities related to the discontinued operations.
The following table summarizes the components of discontinued operations, net of taxes, for the years ended December 31, 2019 and 2018:
|
|
Years Ended December 31, |
| ||||
|
|
|
2018 |
| |||
|
|
(In Millions) |
| ||||
REVENUES |
|
|
|
|
| ||
Aircraft leasing revenue |
|
$ |
966 |
|
$ |
954 |
|
Net investment income |
|
|
|
4 |
| ||
Net realized investment loss |
|
(7 |
) |
(6 |
) | ||
Other income |
|
141 |
|
95 |
| ||
Total revenues |
|
1,100 |
|
1,047 |
| ||
|
|
|
|
|
| ||
BENEFITS AND EXPENSES |
|
|
|
|
| ||
Operating expenses |
|
146 |
|
182 |
| ||
Depreciation of aircraft |
|
284 |
|
352 |
| ||
Interest expense |
|
263 |
|
244 |
| ||
Total benefits and expenses |
|
693 |
|
778 |
| ||
|
|
|
|
|
| ||
Income from discontinued operations |
|
407 |
|
269 |
| ||
Provision for income taxes from discontinued operations |
|
73 |
|
40 |
| ||
Income from discontinued operations, net of taxes |
|
334 |
|
229 |
| ||
|
|
|
|
|
| ||
Gain on sale of discontinued operations |
|
23 |
|
|
| ||
Benefit from income taxes from discontinued operations |
|
(2 |
) |
|
| ||
Gain on sale of discontinued operations, net of taxes |
|
25 |
|
|
| ||
|
|
|
|
|
| ||
Discontinued operations, net of taxes |
|
$ |
359 |
|
$ |
229 |
|
7. DERIVATIVES AND HEDGING ACTIVITIES
The Company primarily utilizes derivative instruments to manage its exposure to interest rate risk, foreign currency risk, and equity risk. Derivative instruments are also used to manage the duration mismatch of assets and liabilities. The Company utilizes a variety of derivative instruments including swaps, futures, and options. In addition, certain insurance products offered by the Company contain features that are separately accounted for as derivatives.
Accounting for derivatives requires the Company to recognize all derivative instruments as either assets or liabilities at fair value. The accounting for changes in the fair value (i.e., gains or losses) of derivatives depends on whether it has been designated and qualifies as part of a hedging relationship and further, on the type of hedging relationship.
DERIVATIVES NOT DESIGNATED AS HEDGING
Equity Derivatives
The Company utilizes equity derivatives to manage equity risk associated with variable annuity GLBs within certain insurance and reinsurance contracts, including those deemed embedded derivatives. See below for further information on the Company’s embedded derivatives.
Equity total return swaps are swaps whereby the Company agrees to exchange the difference between the economic risk and reward of an equity index and a floating rate of interest, calculated by reference to an agreed upon notional amount. Cash is paid and received over the life of the contract based on the terms of the swap.
Equity futures are exchange-traded transactions whereby the Company agrees to purchase or sell a specified number of contracts, the values of which are determined by the underlying equity indices, and to post variation margin on a daily basis in an amount equal to the change in the daily fair value of those contracts. The Company is also required to pledge initial margin for all futures contracts. The amount of required margin is determined by the exchange on which it is traded.
Equity put options involve the exchange of an upfront payment for the return, at the end of the option agreement, of the equity index below a specified strike price.
Equity call options are contracts to buy the index at a predetermined time at a contracted price. These contracts involve the exchange of a premium payment (either paid up front or at the time of exercise) for the return, at the end of the option agreement, of the differentials in the index at the time of exercise and the strike price subject to a cap, net of option premiums.
Foreign Currency Interest Rate Swaps
The Company utilizes foreign currency interest rate swaps primarily to manage the currency risk associated with investments and liabilities that are denominated in foreign currencies. Foreign currency interest rate swap agreements are used to convert fixed or floating rate foreign-denominated assets or liabilities to U.S. dollar fixed or floating rate assets or liabilities. A foreign currency interest rate swap involves the exchange of an initial principal amount in two currencies and the agreement to re-exchange the currencies at a future date at an agreed-upon exchange rate. There are also periodic exchanges of interest payments in the two currencies at specified intervals, calculated using agreed-upon interest rates, exchange rates, and the exchanged principal amounts. The main currencies that the Company economically hedges are the euro, British pound, and Canadian dollar.
Interest Rate Swaps
The Company utilizes interest rate swaps to reduce market risk from changes in interest rates and other interest rate exposure arising from duration mismatches between assets and liabilities and to manage interest rate risk in variable annuity GLBs. An interest rate swap agreement involves the exchange, at specified intervals, of interest payments resulting from the difference between fixed rate and floating rate interest amounts calculated by reference to an underlying notional amount. Generally, no cash is exchanged at the outset of the contract and no principal payments are made by either party.
Synthetic Guaranteed Interest Contracts
The Company issues synthetic guaranteed interest contracts (GICs) to Employee Retirement Income Security Act of 1974 (ERISA) qualified defined contribution employee benefit plans (ERISA Plan) that are considered derivatives. The ERISA Plan uses the contracts in its stable value fixed income option. The Company receives a fee, recognized in net realized investment gain (loss), for providing book value accounting for the ERISA Plan stable value fixed income option. In the event that plan participant elections exceed the fair value of the assets or if the contract is terminated and at the end of the termination period the book value under the contract exceeds the fair value of the assets, then the Company is required to pay the ERISA Plan the difference between book value and fair value. The Company mitigates the investment risk through pre-approval and monitoring of the investment guidelines, requiring high quality investments and adjustments to the plan crediting rates to compensate for unrealized losses in the portfolios.
Embedded Derivatives
The Company has certain insurance and reinsurance contracts that contain embedded derivatives. When it is determined that the embedded derivative possesses economic and risk characteristics that are not clearly and closely related to those of the related insurance or reinsurance contract, and that a separate instrument with the same terms would qualify as a derivative instrument, it is separated from the host contract and accounted for as a stand-alone derivative.
The Company offers a rider on certain variable annuity contracts that guarantees net principal over specific holding periods, as well as riders on certain variable annuity contracts that guarantee a minimum withdrawal benefit over specified periods, subject to certain restrictions. These variable annuity GLBs are considered embedded derivatives. At inception, the Company attributes to the embedded derivative a portion of the projected future guarantee fees to be collected from the policyholder equal to the present value of projected future guaranteed benefits.
GLBs on variable annuity contracts issued between January 1, 2007 and March 31, 2009 are partially reinsured by third party reinsurers. These reinsurance arrangements are used to offset a portion of the Company’s exposure to the variable annuity GLBs for the lives of the host variable annuity contracts issued. The ceded portion of these variable annuity GLBs is considered an embedded derivative. Until October 2020, the Company also reinsured certain variable annuity contracts with guaranteed minimum benefits to an affiliated reinsurer.
The Company employs economic hedging strategies to mitigate equity and interest rate risk associated with the variable annuity GLBs not covered by reinsurance. The Company utilizes equity total return swaps, equity futures and equity put options based upon domestic and international equity market indices to economically hedge the equity risk of the guarantees in its variable annuity products. The Company also utilizes interest rate swaps to manage interest rate risk in variable annuity GLBs.
The Company offers fixed indexed annuity products where interest is credited to the policyholder’s account balance based on domestic and/or international equity index changes, subject to various caps or participation rates. The indexed products contain embedded derivatives. The Company utilizes equity total return swaps, equity futures and equity call options based upon broad market indices to economically hedge the interest credited to the policyholder based upon the underlying equity index.
The Company offers life insurance products with indexed account options. The interest credited on the indexed accounts is a function of the underlying domestic or international equity index, subject to various caps, thresholds and participation rates. The life insurance products with indexed accounts contain embedded derivatives. The Company utilizes equity call options to economically hedge the interest credited to the policyholder based upon the underlying index for its life insurance products with indexed account options.
The following table summarizes amounts recognized in net realized investment gain (loss) for derivatives not designated as hedging instruments. Gains and losses include the changes in fair value of the derivatives and amounts realized on terminations. The amounts presented do not include losses from the periodic net payments and amortization of $1,611 million, $705 million, and $320 million for the years ended December 31, 2020, 2019, and 2018, respectively, which are recorded in net realized investment gain (loss).
|
|
Years Ended December 31, |
| |||||||
|
|
|
2019 |
|
2018 |
| ||||
|
|
(In Millions) |
| |||||||
Equity total return swaps |
|
$ |
23 |
|
$ |
(71 |
) |
$ |
44 |
|
Equity put options |
|
38 |
|
(23 |
) |
36 |
| |||
Equity call options |
|
1,199 |
|
1,163 |
|
41 |
| |||
Foreign currency and interest rate swaps |
|
(25 |
) |
12 |
|
52 |
| |||
Other |
|
(2 |
) |
(1 |
) |
(1 |
) | |||
Embedded derivatives: |
|
|
|
|
|
|
| |||
Variable annuity GLBs |
|
(495 |
) |
(105 |
) |
(145 |
) | |||
Fixed indexed annuities |
|
(474 |
) |
(565 |
) |
44 |
| |||
Life indexed accounts |
|
(341 |
) |
(520 |
) |
228 |
| |||
Other |
|
(43 |
) |
(15 |
) |
(7 |
) | |||
Total |
|
$ |
(120 |
) |
$ |
(125 |
) |
$ |
292 |
|
DERIVATIVES DESIGNATED AS CASH FLOW HEDGES
The Company primarily utilizes interest rate swaps to manage its exposure to variability in cash flows due to changes in benchmark interest rates. These cash flows include those associated with existing assets and liabilities. The maximum length of time over which the Company is hedging its exposure to variability in future cash flows for forecasted transactions does not exceed 11 years.
The effective portion of gains from changes in the fair value of interest rate swaps designated as cash flow hedges recognized in OCI was $31 million for the year ended December 31, 2018. The ineffective portion of losses recognized in net realized investment gain (loss) was zero for the year ended December 31, 2018. Effective January 1, 2019, with the adoption of ASU 2017-12, the Company is no longer required to bifurcate ineffectiveness. Gains (losses) from changes in the fair value of foreign currency and interest rate swaps designated as cash flow hedges recognized in OCI was $4 million for the years ended December 31, 2020 and 2019.
No amounts were reclassified from AOCI to earnings due to forecasted cash flows that were no longer probable of occurring for the years ended December 31, 2020, 2019, and 2018.
All of the hedged forecasted transactions for cash flow hedges were determined to be probable of occurring for the years ended December 31, 2020, 2019, and 2018.
Over the next twelve months, the Company anticipates that $6 million of deferred gains on derivative instruments in AOCI will be reclassified to earnings consistent with when the hedged forecasted transaction affects earnings.
DERIVATIVES DESIGNATED AS FAIR VALUE HEDGES
The Company primarily utilizes foreign currency and interest rate swaps to manage its exposure to variability in fair value due to changes in foreign currencies and benchmark interest rates of its assets and liabilities.
Gains and losses include the changes in fair value of the derivatives as well as the offsetting gain or loss on the hedged item attributable to the hedged risk. The Company includes the gain or loss on the derivative in the same line as the offsetting gain or loss on the hedged item. These amounts do not include the periodic net settlements of the derivatives or the income (expense) related to the hedged item.
The following tables disclose items designated and qualifying as hedged items in fair value hedges:
|
|
|
|
Gains (Losses) on |
|
|
|
Gains (Losses) on |
|
|
| ||||
|
|
|
|
Derivative Instrument |
|
Gains (Losses) |
|
Derivative Instrument |
|
Gains (Losses) |
| ||||
Derivative |
|
Hedged |
|
Recognized in Income |
|
on Hedged Item |
|
Recognized in Income |
|
on Hedged Item |
| ||||
Instrument |
|
Item |
|
|
| ||||||||||
(In Millions) |
| ||||||||||||||
Foreign currency swaps |
|
Fixed maturity securities available for sale |
|
$ |
(81 |
) |
$ |
81 |
|
$ |
14 |
|
$ |
(14 |
) |
Interest rate swaps |
|
Fixed maturity securities available for sale |
|
(41 |
) |
41 |
|
(22 |
) |
22 |
| ||||
|
|
|
|
Carrying Amount of |
|
Cumulative Amount of |
| ||||||||
Derivative |
|
Hedged |
|
Hedged Assets and Liabilities |
|
Fair Value Hedging |
| ||||||||
Instrument |
|
Item |
|
|
|
|
| ||||||||
(In Millions) |
| ||||||||||||||
Foreign currency swaps |
|
Fixed maturity securities available for sale |
|
$ |
1,589 |
|
$ |
1,034 |
|
$ |
(75 |
) |
$ |
6 |
|
Interest rate swaps |
|
Fixed maturity securities available for sale |
|
522 |
|
492 |
|
(63 |
) |
(22 |
) | ||||
Interest rate swaps |
|
Fixed maturity securities available for sale |
(1) |
24 |
|
24 |
|
4 |
|
4 |
| ||||
Interest rate swaps |
|
Debt |
(1) |
(651 |
) |
(659 |
) |
(132 |
) |
(140 |
) | ||||
(1) Hedge accounting has been discontinued. The cumulative amount of fair value hedging adjustments in the table above represent the amount remaining.
CONSOLIDATED FINANCIAL STATEMENT IMPACT
Derivative instruments are recorded at fair value and are presented as assets or liabilities based upon the net position for each derivative counterparty by legal entity, taking into account income accruals and net cash collateral. The following table summarizes the notional amount and gross asset or liability derivative fair value and excludes the impact of offsetting asset and liability positions held with the same counterparty, cash collateral payables and receivables, and income accruals. See Note 11 for information on the Company’s fair value measurements and disclosure.
Notional amount represents a standard of measurement of the volume of over the counter (OTC) and exchange-traded derivatives. Notional amount is not a quantification of market risk or credit risk and is not recorded in the consolidated statements of financial condition. Notional amounts generally represent those amounts used to calculate contractual cash flows to be exchanged and are not paid or received, except for certain contracts such as currency swaps.
|
|
|
| ||||||||||||||||
|
|
Notional |
|
Fair Value |
|
Notional |
|
Fair Value |
| ||||||||||
|
|
Amount |
|
Assets |
|
Liabilities |
|
Amount |
|
Assets |
|
Liabilities |
| ||||||
|
|
(In Millions) |
|
(In Millions) |
| ||||||||||||||
Derivatives designated as hedging instruments: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Foreign currency and interest rate swaps - fair value |
|
$ |
1,865 |
|
$ |
(34 |
) |
$ |
136 |
(1) |
$ |
1,507 |
|
$ |
41 |
|
$ |
36 |
(1) |
Interest rate swaps - cash flow |
|
50 |
|
9 |
|
|
(1) |
50 |
|
5 |
|
|
(1) | ||||||
Total derivatives designated as hedging instruments |
|
1,915 |
|
(25 |
) |
136 |
|
1,557 |
|
46 |
|
36 |
| ||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Derivatives not designated as hedging instruments: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Equity total return swaps |
|
161 |
|
|
|
1 |
(1) |
1,695 |
|
1 |
|
34 |
(1) | ||||||
Equity futures |
|
2,867 |
|
|
|
|
|
1,830 |
|
|
|
|
| ||||||
Equity put options |
|
|
|
|
|
|
|
482 |
|
9 |
|
|
(1) | ||||||
Equity call options |
|
17,260 |
|
1,267 |
|
1 |
(1) |
13,916 |
|
852 |
|
4 |
(1) | ||||||
Foreign currency and interest rate swaps |
|
2,715 |
|
212 |
|
31 |
(1) |
2,146 |
|
113 |
|
20 |
(1) | ||||||
Synthetic GICs |
|
34,144 |
|
|
|
|
|
28,568 |
|
|
|
|
| ||||||
Embedded derivatives: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Variable annuity GLBs |
|
|
|
|
|
1,892 |
(3) |
|
|
|
|
1,208 |
(3) | ||||||
Variable annuity GLB - reinsurance contracts |
|
|
|
365 |
|
|
(2) |
|
|
269 |
|
|
(2) | ||||||
Fixed indexed annuities |
|
|
|
|
|
2,185 |
(4) |
|
|
|
|
1,652 |
(4) | ||||||
Life indexed accounts |
|
|
|
|
|
1,081 |
(4) |
|
|
|
|
752 |
(4) | ||||||
Other |
|
|
|
38 |
|
154 |
(5) |
|
|
26 |
|
90 |
(5) | ||||||
Total derivatives not designated as hedging instruments |
|
57,147 |
|
1,882 |
|
5,345 |
|
48,637 |
|
1,270 |
|
3,760 |
| ||||||
Total derivatives |
|
$ |
59,062 |
|
$ |
1,857 |
|
$ |
5,481 |
|
$ |
50,194 |
|
$ |
1,316 |
|
$ |
3,796 |
|
Location on the consolidated statements of financial condition:
(1) Other investments and other liabilities
(2) Other assets
(3) Future policy benefits
(4) Policyholder account balances
(5) Other assets, policyholder account balances and other liabilities
OFFSETTING ASSETS AND LIABILITIES
The following table reconciles the net amount of derivative assets and liabilities (excluding embedded derivatives) subject to master netting arrangements after the offsetting of collateral. Gross amounts include income or expense accruals. Gross amounts offset include cash collateral received or pledged limited to the gross fair value of recognized derivative assets or liabilities, net of accruals. Excess cash collateral received or pledged is not included in the tables due to the foregoing limitation. Gross amounts not offset include asset collateral received or pledged limited to the gross fair value of recognized derivative assets and liabilities.
|
|
Gross Amounts of |
|
|
|
|
|
Gross Amounts |
|
|
| |||||
|
|
Recognized |
|
Gross Amounts |
|
|
|
Not Offset - |
|
|
| |||||
|
|
Assets/Liabilities (1) |
|
Offset (2) |
|
Net Amounts |
|
Asset Collateral (3) |
|
Net Amounts |
| |||||
|
|
(In Millions) |
| |||||||||||||
|
|
|
|
|
|
|
|
|
|
| ||||||
Derivative assets |
|
$ |
1,053 |
|
$ |
(1,005 |
) |
$ |
48 |
|
$ |
(11 |
) |
$ |
37 |
|
Derivative liabilities |
|
97 |
|
(94 |
) |
3 |
|
0 |
|
3 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
|
|
|
|
|
|
|
|
|
| ||||||
Derivative assets |
|
$ |
753 |
|
$ |
(587 |
) |
$ |
166 |
|
$ |
(157 |
) |
$ |
9 |
|
Derivative liabilities |
|
64 |
|
(64 |
) |
— |
|
0 |
|
— |
|
(1) As of December 31, 2020 and 2019, derivative assets include expense accruals of $287 million and $213 million, respectively, and derivative liabilities include expense accruals of zero and $1 million, respectively.
(2) As of December 31, 2020 and 2019, the Company received excess cash collateral of $7 million and $13 million, respectively, and provided excess cash collateral of zero and $1 million, respectively, which are not included in the table.
(3) As of December 31, 2020 and 2019, the Company accepted excess asset collateral of $1 million, which are not included in the table.
COLLATERAL
For OTC derivatives, OTC—cleared derivatives and exchange—traded derivatives, the Company pledges and receives cash and asset collateral. Cash collateral received from counterparties was $957 million and $541 million as of December 31, 2020 and 2019, respectively. This unrestricted cash collateral is included in cash, cash equivalents, and restricted cash and the obligation to return it is netted against the fair value of derivatives in other investments or other liabilities. Cash collateral pledged to counterparties was $161 million and $87 million as of December 31, 2020 and 2019, respectively. A receivable representing the right to call this collateral back from the counterparty is netted against the fair value of derivatives in other investments or other liabilities. Net exposure to the counterparty is calculated as the fair value of all derivative positions with the counterparty, net of income or expense accruals and cash collateral paid or received. If the net exposure to the counterparty is positive, the amount is reflected in other investments, whereas, if the net exposure to the counterparty is negative, the fair value is included in other liabilities.
As of December 31, 2020 and 2019, the Company had also accepted collateral, consisting of various securities, with a fair value of $12 million and $158 million, respectively, which are held in separate custodial accounts and are not recorded in the consolidated statements of financial condition. The Company is permitted by contract to sell or repledge this collateral and as of December 31, 2020 and 2019, none of the collateral had been sold or repledged. As of December 31, 2020 and 2019, the Company provided collateral in the form of various securities with a fair value of $78 million and zero, respectively, which are included in fixed maturity securities.
CREDIT EXPOSURE AND CREDIT RISK RELATED CONTINGENT FEATURES
The Company is exposed to credit-related losses in the event of nonperformance by counterparties to OTC derivatives, which are bilateral contracts between two counterparties. The Company manages credit risk by dealing with creditworthy counterparties, establishing risk control limits, executing legally enforceable master netting agreements, and obtaining collateral where appropriate. In addition, the Company evaluates the financial stability of each counterparty before entering into each agreement and throughout the period that the financial instrument is owned.
The Company’s OTC-cleared derivatives are effected through central clearing counterparties and its exchange-traded derivatives are effected through regulated exchanges. Such positions are marked to market and margined on a daily basis (both initial margin and variation margin), and the Company has minimal exposure to credit-related losses in the event of nonperformance by counterparties to such derivatives. The Company currently pledges cash and securities, which are restricted to sale, to satisfy this collateral requirement.
For OTC derivative transactions, the Company enters into legally enforceable master netting agreements which provide for the netting of payments and receipts with a single counterparty. The net position with each counterparty is calculated as the aggregate fair value of all derivative instruments with each counterparty, net of income or expense accruals and collateral paid or received.
These master netting agreements include collateral arrangements with derivative counterparties, which requires positions be marked to market and margined on a daily basis by the daily settlement of variation margin. The Company has minimal counterparty exposure to credit-related losses in the event of non performance by these counterparties.
The Company’s credit exposure is measured on a counterparty basis as the net positive fair value of all derivative positions with the counterparty, net of income or expense accruals and cash collateral received. The Company’s credit exposure for OTC derivatives as of December 31, 2020 was $37 million. The maximum exposure to any single counterparty was $13 million as of December 31, 2020. All of the Company’s credit exposure from derivative contracts is with investment grade counterparties.
There are no credit-contingent provisions in the Company’s collateral arrangements for its OTC derivatives that provide for a reduction of collateral thresholds in the event of downgrades in the financial strength ratings, assigned by certain independent rating agencies, of the Company and/or the counterparty.
Certain of the OTC master agreements include a termination event clause associated with financial strength ratings assigned by certain independent rating agencies. If these financial strength ratings were to fall below a specified level, as defined within each counterparty master agreement or if one of the rating agencies were to cease to provide a financial strength rating, the counterparty could terminate the master agreement with payment due based on the fair value of the underlying derivatives. As of December 31, 2020, the Company’s financial strength ratings were above the specified level.
8. POLICYHOLDER LIABILITIES
POLICYHOLDER ACCOUNT BALANCES
Components of the liability for policyholder account balances is as follows:
|
|
| |||||
|
|
|
2019 |
| |||
|
|
(In Millions) |
| ||||
UL and ISWL |
|
$ |
32,388 |
|
$ |
31,101 |
|
Annuity and deposit liabilities |
|
28,483 |
|
26,962 |
| ||
Fixed indexed annuity embedded derivatives |
|
2,185 |
|
1,652 |
| ||
Life indexed account embedded derivatives |
|
1,081 |
|
752 |
| ||
Funding agreements |
|
1,999 |
|
167 |
| ||
Total |
|
$ |
66,136 |
|
$ |
60,634 |
|
FUTURE POLICY BENEFITS
Components of the liability for future policy benefits is as follows:
|
|
| |||||
|
|
|
2019 |
| |||
|
|
(In Millions) |
| ||||
Annuity reserves |
|
$ |
16,233 |
|
$ |
13,409 |
|
Policy benefits (1) |
|
3,644 |
|
3,213 |
| ||
URR (2) |
|
2,314 |
|
1,882 |
| ||
Life insurance |
|
2,176 |
|
1,627 |
| ||
Variable annuity GLB embedded derivatives |
|
1,892 |
|
1,208 |
| ||
Closed Block liabilities |
|
235 |
|
241 |
| ||
Other |
|
92 |
|
104 |
| ||
Total |
|
$ |
26,586 |
|
$ |
21,684 |
|
(1) As of December 31, 2020 and 2019, policy benefits consist primarily of $1,253 million and $1,118 million of liabilities for unpaid claims and $1,898 million and $1,828 million primarily representing single premium immediate annuity reserves, respectively.
(2) The Company annually revises certain assumptions to develop EGPs for its products subject to URR amortization. The revised EGPs resulted in decreased URR amortization of $134 million, increased URR amortization of $48 million, and decreased URR amortization of $120 million for the years ended December 31, 2020, 2019, and 2018, respectively.
9. SEPARATE ACCOUNTS AND GUARANTEED BENEFIT FEATURES
The Company issues variable annuity contracts through separate accounts for which investment income and investment gains and losses accrue directly to, and investment risk is borne by, the contract holder (traditional variable annuities). These contracts also include various types of GMDB and GLB features. For a discussion of certain GLBs accounted for as embedded derivatives, see Note 7.
The GMDBs provide a specified minimum return upon death. Many of these death benefits are spousal, whereby a death benefit will be paid upon death of the first spouse. The survivor has the option to terminate the contract or continue it and have the death benefit paid into the contract and a second death benefit paid upon the survivor’s death. The GMDB features include those where the Company contractually guarantees to the contract holder either (a) return of no less than total deposits made to the contract less any partial withdrawals (return of net deposits), (b) the highest contract value on any contract anniversary date through age 80 minus any payments or partial withdrawals following the contract anniversary (anniversary contract value), or (c) the highest of contract value on certain specified dates or total deposits made to the contract less any partial withdrawals plus a minimum return (minimum return).
The guaranteed minimum income benefit (GMIB) is a GLB that provides the contract holder with a guaranteed annuitization value after 10 years. Annuitization value is generally based on deposits adjusted for withdrawals plus a minimum return. In general, the GMIB requires contract holders to invest in an approved asset allocation strategy.
The Company offers variable and fixed annuity contracts with guaranteed minimum withdrawal benefits for life (GMWBL) features. The GMWBL is a GLB that provides, subject to certain restrictions, a percentage of a contract holder’s guaranteed payment base will be available for withdrawal for life starting no earlier than age 59.5, regardless of market performance. The rider terminates upon death of the contract holder or their spouse if a spousal form of the rider is purchased.
Information in the event of death on the various GMDB features outstanding was as follows (the Company’s variable annuity contracts with guarantees may offer more than one type of guarantee in each contract; therefore, the amounts listed are not mutually exclusive):
|
|
| |||||
|
|
|
2019 |
| |||
|
|
($In Millions) |
| ||||
Return of net deposits: |
|
|
|
|
| ||
Separate account value |
|
$ |
54,154 |
|
$ |
50,672 |
|
Net amount at risk (1) |
|
208 |
|
208 |
| ||
Average attained age of contract holders |
|
69 years |
|
69 years |
| ||
|
|
|
|
|
| ||
Anniversary contract value: |
|
|
|
|
| ||
Separate account value |
|
$ |
13,128 |
|
$ |
12,755 |
|
Net amount at risk (1) |
|
170 |
|
181 |
| ||
Average attained age of contract holders |
|
71 years |
|
70 years |
| ||
|
|
|
|
|
| ||
Minimum return: |
|
|
|
|
| ||
Separate account value |
|
$ |
762 |
|
$ |
755 |
|
Net amount at risk (1) |
|
84 |
|
114 |
| ||
Average attained age of contract holders |
|
75 years |
|
74 years |
|
(1) Represents the amount of death benefit in excess of the current contract holder account balance as of December 31.
Information regarding GMIB and GMWBL features outstanding is as follows:
|
|
| |||||||||||||||||
|
|
|
2019 |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
| |||||||
|
|
GMIB |
|
GMWBL(2) |
|
GMWBL(3) |
| ||||||||||||
|
|
($ In Millions) |
|
($ In Millions) |
|
($ In Millions) |
| ||||||||||||
Separate account value |
|
$ |
1,421 |
|
$ |
1,410 |
|
$ |
8,685 |
|
$ |
7,883 |
|
|
|
|
| ||
Net amount at risk (1) |
|
113 |
|
153 |
|
185 |
|
274 |
|
$ |
191 |
|
$ |
116 |
| ||||
Average attained age of contract holders |
|
66 years |
|
65 years |
|
70 years |
|
69 years |
|
69 years |
|
68 years |
| ||||||
(1) GMIB net amount at risk represents the amount of estimated annuitization benefits in excess of the current contract holder account balance at December 31. Variable annuity GMWBL net amount at risk represents the protected balance, as defined, in excess of account value at December 31. Fixed annuity GMWBL net amount at risk represents the present value of estimated future excess benefit payments at December 31.
(2) GMWBL related to variable annuities.
(3) GMWBL related to fixed annuities.
The determination of GMDB, GMIB, and GMWBL liabilities is based on models that involve a range of scenarios and assumptions, including those regarding expected market rates of return and volatility, contract surrender rates, rider utilization, and mortality experience. The following table summarizes the GMDB, GMIB, and GMWBL liabilities, which are recorded in future policy benefits, and changes in these liabilities, which are reflected in policy benefits paid or provided:
|
|
| |||||||||||||||||||||||
|
|
|
2019 |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
| |||||||||
|
|
GMDB |
|
GMIB |
|
GMWBL (1) |
|
GMWBL (2) |
| ||||||||||||||||
|
|
(In Millions) |
|
(In Millions) |
|
(In Millions) |
|
(In Millions) |
| ||||||||||||||||
Balance, beginning of year |
|
$ |
19 |
|
$ |
18 |
|
$ |
39 |
|
$ |
41 |
|
$ |
112 |
|
$ |
88 |
|
$ |
40 |
|
$ |
30 |
|
Changes in reserves |
|
31 |
|
9 |
|
20 |
|
4 |
|
52 |
|
24 |
|
38 |
|
10 |
| ||||||||
Benefits paid |
|
(9 |
) |
(8 |
) |
(7 |
) |
(6 |
) |
|
|
|
|
|
|
|
| ||||||||
Balance, end of year |
|
$ |
41 |
|
$ |
19 |
|
$ |
52 |
|
$ |
39 |
|
$ |
164 |
|
$ |
112 |
|
$ |
78 |
|
$ |
40 |
|
(1) GMWBL related to variable annuities.
(2) GMWBL related to fixed annuities.
Variable annuity contracts with guarantees were invested in separate account investment options as follows:
|
|
| |||||
|
|
|
2019 |
| |||
|
|
(In Millions) |
| ||||
Asset type: |
|
|
|
|
| ||
Equity |
|
$ |
38,749 |
|
$ |
35,435 |
|
Bonds |
|
15,112 |
|
14,318 |
| ||
Other |
|
524 |
|
1,145 |
| ||
Total separate account value |
|
$ |
54,385 |
|
$ |
50,898 |
|
In addition, the Company issues certain life insurance contracts whereby the Company contractually guarantees to the contract holder a death benefit even when there is insufficient value to cover monthly mortality and expense charges, whereas otherwise the contract would typically lapse.
FDNLGR liabilities are determined by estimating the expected value of FDNLGR costs incurred when the policyholder account balance is projected to be zero and recognizing those costs over the accumulation period based on total expected assessments. The assumptions used in estimating the FDNLGR liability are consistent with those used for amortizing DAC. The FDNLGR costs used in calculating the FDNLGR liability are based on the average FDNLGR costs incurred over a range of scenarios.
The following table summarizes the FDNLGR liability, which are recorded in future policy benefits, and changes in these liabilities, which are reflected in policy benefits paid or provided:
|
|
Direct |
|
Ceded |
|
Net |
| |||
|
|
(In Millions) |
| |||||||
Balance, January 1, 2019 |
|
$ |
950 |
|
$ |
296 |
|
$ |
654 |
|
Incurred guaranteed benefits |
|
210 |
|
50 |
|
160 |
| |||
Paid guaranteed benefits |
|
(6 |
) |
(4 |
) |
(2 |
) | |||
Balance, December 31, 2019 |
|
1,154 |
|
342 |
|
812 |
| |||
Incurred guaranteed benefits |
|
501 |
|
105 |
|
396 |
| |||
Paid guaranteed benefits |
|
(7 |
) |
(5 |
) |
(2 |
) | |||
Balance, December 31, 2020 |
|
$ |
1,648 |
|
$ |
442 |
|
$ |
1,206 |
|
Information regarding life insurance contracts included in the FDNLGR liability is as follows:
|
|
| |||||
|
|
|
2019 |
| |||
|
|
($In Millions) |
| ||||
Net amount at risk (1) |
|
$ |
15,297 |
|
$ |
15,342 |
|
Average attained age of policyholders |
|
64 years |
|
63 years |
| ||
(1) Represents the amount of death benefit in excess of the current policyholder account balance as of December 31.
10. DEBT AND FVO DEBT
SHORT-TERM DEBT
|
|
| |||||
|
|
|
2019 |
| |||
|
|
(In Millions) |
| ||||
Short-term debt: (1) |
|
|
|
|
| ||
Other VIE debt (Note 3) |
|
$ |
187 |
|
$ |
113 |
|
Total short-term debt |
|
$ |
187 |
|
$ |
113 |
|
(1) Does not include current maturities of long-term debt.
Pacific Life and PL&A
Pacific Life maintains a $700 million commercial paper program. There was no commercial paper debt outstanding as of December 31, 2020 and 2019. In addition, Pacific Life has a bank revolving credit facility of $400 million maturing in June 2023 that will serve as a back-up line of credit to the commercial paper program. Interest is at variable rates. This facility had no debt outstanding as of December 31, 2020 and 2019.
Pacific Life and PL&A maintains uncommitted reverse repurchase lines of credit with various financial institutions. These borrowings are at variable rates of interest based on collateral and market conditions. There was no debt outstanding in connection with these reverse repurchase lines of credit as of December 31, 2020 and 2019.
Pacific Life is eligible to receive advances from the FHLB of Topeka based on a percentage of Pacific Life’s statutory general account assets provided it has sufficient available eligible collateral and is in compliance with the FHLB of Topeka requirements, debt covenant restrictions and insurance law and regulations. The Company had estimated available eligible collateral of $1.7 billion as of December 31, 2020. Interest is at variable or fixed rates. The Company had no debt outstanding with the FHLB of Topeka as of December 31, 2020 and 2019.
PL&A is a member of the FHLB of San Francisco. PL&A is eligible to receive advances from the FHLB of San Francisco based on a percentage of PL&A’s statutory net admitted assets provided it has sufficient available eligible collateral and is in compliance with the FHLB of San Francisco requirements and insurance law and regulations. PL&A had estimated available eligible collateral of $16 million as of December 31, 2020. Interest is at variable or fixed rates. PL&A had no debt outstanding with the FHLB of San Francisco as of December 31, 2020 and 2019.
LONG-TERM DEBT
|
|
|
|
|
|
December 31, |
|
|
|
|
|
| |||
|
|
|
|
|
|
|
|
|
|
|
2019 |
| |||
($ In Millions) |
|
Carrying |
|
Maturity Date |
|
Interest |
|
Interest Payment |
|
Type |
|
Carrying |
| ||
Long-term debt: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||
Surplus notes: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||
2017 surplus notes (1) |
|
$ |
749 |
|
2067 |
|
4.3% (2) |
|
Semiannually(2) |
|
Fixed(2) |
|
$ |
749 |
|
2013 internal surplus note (3) |
|
406 |
|
2043 |
|
5.125% |
|
Semiannually |
|
Fixed |
|
406 |
| ||
2010 internal surplus note (3) |
|
|
|
2020 |
|
6.0% |
|
Semiannually |
|
Fixed |
|
56 |
| ||
2009 surplus notes (1) |
|
385 |
|
2039 |
|
9.25% |
|
Semiannually |
|
Fixed |
|
385 |
| ||
1993 surplus notes (1) |
|
134 |
|
2023 |
|
7.9% |
|
Semiannually |
|
Fixed |
|
134 |
| ||
Fair value hedge adjustments - terminated interest rate swap agreements (4) |
|
132 |
|
140 |
|
|
|
|
|
|
|
|
| ||
Non-recourse long-term debt: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||
Non-recourse debt (5) |
|
1,105 |
|
2022 to 2030 |
|
1.8% to 5.4% |
|
Monthly |
|
Variable/Fixed |
|
1,058 |
| ||
CMBS VIE debt (Note 3) (6) |
|
1,685 |
|
2025 to 2044 |
|
3.3% to 3.6% |
|
Monthly |
|
Fixed |
|
1,521 |
| ||
Total long-term debt |
|
4,596 |
|
|
|
|
|
|
|
|
|
4,449 |
| ||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
Total short-term debt |
|
187 |
|
|
|
|
|
|
|
|
|
113 |
| ||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
Debt issuance cost |
|
(21 |
) |
|
|
|
|
|
|
|
|
(20 |
) | ||
Total debt |
|
$ |
4,762 |
|
|
|
|
|
|
|
|
|
$ |
4,542 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
FVO debt - VIE (Note 3) |
|
$ |
913 |
|
|
|
|
|
|
|
|
|
$ |
910 |
|
(1) The surplus notes are unsecured and subordinated to all present and future senior indebtedness and policy claims of Pacific Life. All future payments of interest and principal on these surplus notes can be made only with the prior approval of the NE DOI. The 1993 surplus notes may not be redeemed at the option of Pacific Life or any holder of the surplus notes. Pacific Life may redeem all or a portion of the 2009 surplus notes at its option at the redemption price described under the terms of the notes and may redeem all or a portion of the 2017 surplus notes at its option at any time on or after October 24, 2047 at the redemption price described under the terms of the notes, subject to the prior approval of the NE DOI noted above.
(2) Represent rate, frequency, and type through October 23, 2047. Thereafter until maturity, interest is payable quarterly at a floating rate equal to three-month LIBOR for deposits in U.S. dollars plus 2.796%.
(3) The NE DOI approved the issuance of an internal surplus note by Pacific Life to Pacific LifeCorp for $450 million (the 2010 internal surplus note) and $500 million (the 2013 internal surplus note). The 2010 surplus note is unsecured and subordinated to all present and future senior indebtedness and policy claims of the Company. The 2013 surplus note is an unsecured debt obligation of the Company and ranks equally with the Company’s existing and future surplus notes or similar obligations. The 2013 surplus note is subordinated in right of payment to all other existing and future senior indebtedness of the Company and to present and future claims under insurance policies and annuity contracts issued by the Company. All future payments of interest and principal on these internal surplus notes can be made only with the prior approval of the NE DOI.
(4) Pacific Life previously terminated interest rate swaps converting the 1993 surplus notes and 2009 surplus notes to variable rate notes. As a result, fair value hedge adjustments were recorded to the net carrying amount of each note and are being amortized as a reduction to interest expense over the remaining life of the surplus notes using the effective interest method. The total unamortized fair value hedge adjustments as of December 31, 2020 for the 1993 surplus notes and 2009 surplus notes were $15 million and $117 million, respectively. The total unamortized fair value hedge adjustments as of December 31, 2019 for the 1993 surplus notes and 2009 surplus notes were $19 million and $121 million, respectively.
(5) As of December 31, 2020 and 2019, $1,056 million and $1,008 million, respectively, was outstanding on various real estate property related loans entered into by certain subsidiaries of Pacific Asset Holding LLC, a wholly owned subsidiary of Pacific Life. These loans are secured by real estate properties. Also included in other non-recourse debt is $49 million and $50 million as of
December 31, 2020 and 2019, respectively, on a secured borrowing due to an unrelated third party. The collateral for the amount borrowed is a participation interest in two of the Company’s commercial mortgage loans that are secured by real estate property.
(6) This debt is secured by commercial real estate property and the Company is not responsible for any principal or interest shortfalls from the underlying collateral. See Note 3.
Interest expense is included in operating and other expenses and was $242 million, $266 million, and $238 million for the years ended December 31, 2020, 2019, and 2018, respectively.
Certain of the Company’s debt instruments and credit facilities contain various administrative, reporting, legal, and financial covenants. The Company believes it was in compliance with all such covenants as of December 31, 2020.
The following summarizes aggregate scheduled principal payments during the next five years and thereafter:
|
|
Surplus |
|
Non-recourse |
|
|
| |||
|
|
Notes |
|
Debt |
|
Total |
| |||
|
|
(In Millions) |
| |||||||
Years Ending December 31: |
|
|
|
|
|
|
| |||
2021 |
|
|
|
$ |
4 |
|
$ |
4 |
| |
2022 |
|
|
|
207 |
|
207 |
| |||
2023 |
|
$ |
134 |
|
77 |
|
211 |
| ||
2024 |
|
|
|
224 |
|
224 |
| |||
2025 |
|
|
|
88 |
|
88 |
| |||
Thereafter |
|
1,545 |
|
505 |
|
2,050 |
| |||
Total |
|
$ |
1,679 |
|
$ |
1,105 |
|
$ |
2,784 |
|
The table above excludes short-term debt, VIE debt, fair value hedge adjustments, and original issue discount fees of $5 million.
FVO DEBT
As of December 31, 2020 and 2019, the Company had FVO debt from CLOs classified as VIEs (Note 3) of $913 million and $910 million, respectively, with floating interest rates that range from three month LIBOR plus 1.09% to 6.68%, with maturities ranging from 2029 to 2031. This debt is secured by syndicated bank loans, is non-recourse to the Company and the Company is not responsible for any principal or interest shortfalls from the underlying collateral.
11. FAIR VALUE OF FINANCIAL INSTRUMENTS
The Codification’s Fair Value Measurements and Disclosures Topic establishes a hierarchy that prioritizes the inputs of valuation methods used to measure fair value for financial assets and financial liabilities that are carried at fair value. The determination of fair value requires the use of observable market data when available. The hierarchy consists of the following three levels that are prioritized based on observable and unobservable inputs.
Level 1 Unadjusted quoted prices for identical instruments in active markets. Level 1 financial instruments include securities that are traded in an active exchange market.
Level 2 Observable inputs other than Level 1 prices, such as quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in inactive markets; and model-derived valuations for which all significant inputs are observable market data.
Level 3 Valuations derived from valuation techniques in which one or more significant inputs are not market observable.
The following tables present, by fair value hierarchy level, the Company’s financial assets and liabilities that are carried at fair value as of December 31, 2020 and 2019.
|
|
Level 1 |
|
Level 2 |
|
Level 3 |
|
Gross |
|
Netting |
|
Total |
| ||||||
|
|
(In Millions) |
| ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
U.S. Government |
|
|
|
$ |
66 |
|
|
|
|
|
|
|
$ |
66 |
| ||||
Obligations of states and political subdivisions |
|
|
|
2,317 |
|
$ |
43 |
|
|
|
|
|
2,360 |
| |||||
Foreign governments |
|
|
|
719 |
|
|
|
|
|
|
|
719 |
| ||||||
Corporate securities |
|
|
|
58,802 |
|
2,876 |
|
|
|
|
|
61,678 |
| ||||||
RMBS |
|
|
|
3,137 |
|
7 |
|
|
|
|
|
3,144 |
| ||||||
CMBS |
|
|
|
1,994 |
|
50 |
|
|
|
|
|
2,044 |
| ||||||
Other asset-backed securities |
|
|
|
2,339 |
|
512 |
|
|
|
|
|
2,851 |
| ||||||
Total fixed maturity securities |
|
— |
|
69,374 |
|
3,488 |
|
— |
|
— |
|
72,862 |
| ||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
FVO securities |
|
|
|
1,664 |
|
|
|
|
|
|
|
1,664 |
| ||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Other investments: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Trading securities |
|
|
|
818 |
|
|
|
|
|
|
|
818 |
| ||||||
Equity securities |
|
$ |
19 |
|
13 |
|
|
|
|
|
|
|
32 |
| |||||
Other investments (2) |
|
5 |
|
362 |
|
11 |
|
|
|
|
|
378 |
| ||||||
Other investments measured at NAV (3) |
|
|
|
|
|
|
|
|
|
|
|
1,498 |
| ||||||
Total other investments |
|
24 |
|
1,193 |
|
11 |
|
— |
|
— |
|
2,726 |
| ||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Derivatives: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Foreign currency and interest rate swaps |
|
|
|
187 |
|
|
|
$ |
187 |
|
$ |
(132 |
) |
55 |
| ||||
Equity derivatives |
|
|
|
|
|
1,267 |
|
1,267 |
|
(61 |
) |
1,206 |
| ||||||
Embedded derivatives |
|
|
|
|
|
403 |
|
403 |
|
|
|
403 |
| ||||||
Total derivatives |
|
— |
|
187 |
|
1,670 |
|
1,857 |
|
(193 |
) |
1,664 |
| ||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Separate account assets: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Separate account assets |
|
64,393 |
|
|
|
|
|
|
|
|
|
64,393 |
| ||||||
Separate account assets measured at NAV (3) |
|
|
|
|
|
|
|
|
|
|
|
507 |
| ||||||
Total separate account assets (4) |
|
64,393 |
|
— |
|
— |
|
— |
|
— |
|
64,900 |
| ||||||
Total |
|
$ |
64,417 |
|
$ |
72,418 |
|
$ |
5,169 |
|
$ |
1,857 |
|
$ |
(193 |
) |
$ |
143,816 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
FVO debt |
|
|
|
$ |
913 |
|
|
|
|
|
|
|
$ |
913 |
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Derivatives: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Foreign currency and interest rate swaps |
|
|
|
167 |
|
|
|
$ |
167 |
|
$ |
(132 |
) |
35 |
| ||||
Equity derivatives |
|
|
|
|
|
$ |
2 |
|
2 |
|
(61 |
) |
(59 |
) | |||||
Embedded derivatives |
|
|
|
|
|
5,312 |
|
5,312 |
|
|
|
5,312 |
| ||||||
Total derivatives |
|
— |
|
167 |
|
5,314 |
|
5,481 |
|
(193 |
) |
5,288 |
| ||||||
Total |
|
— |
|
$ |
1,080 |
|
$ |
5,314 |
|
$ |
5,481 |
|
$ |
(193 |
) |
$ |
6,201 |
|
|
|
Level 1 |
|
Level 2 |
|
Level 3 |
|
Gross |
|
Netting |
|
Total |
| ||||||
|
|
(In Millions) |
| ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
U.S. Government |
|
|
|
$ |
331 |
|
|
|
|
|
|
|
$ |
331 |
| ||||
Obligations of states and political subdivisions |
|
|
|
1,642 |
|
$ |
22 |
|
|
|
|
|
1,664 |
| |||||
Foreign governments |
|
|
|
600 |
|
|
|
|
|
|
|
600 |
| ||||||
Corporate securities |
|
|
|
49,912 |
|
2,593 |
|
|
|
|
|
52,505 |
| ||||||
RMBS |
|
|
|
3,149 |
|
40 |
|
|
|
|
|
3,189 |
| ||||||
CMBS |
|
|
|
1,663 |
|
88 |
|
|
|
|
|
1,751 |
| ||||||
Other asset-backed securities |
|
|
|
1,478 |
|
288 |
|
|
|
|
|
1,766 |
| ||||||
Total fixed maturity securities |
|
— |
|
58,775 |
|
3,031 |
|
— |
|
— |
|
61,806 |
| ||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
FVO securities |
|
|
|
1,584 |
|
|
|
|
|
|
|
1,584 |
| ||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Other investments: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Trading securities |
|
|
|
702 |
|
|
|
|
|
|
|
702 |
| ||||||
Equity securities |
|
$ |
90 |
|
16 |
|
|
|
|
|
|
|
106 |
| |||||
Other investments (2) |
|
15 |
|
199 |
|
9 |
|
|
|
|
|
223 |
| ||||||
Other investments measured at NAV (3) |
|
|
|
|
|
|
|
|
|
|
|
1,079 |
| ||||||
Total other investments |
|
105 |
|
917 |
|
9 |
|
— |
|
— |
|
2,110 |
| ||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Derivatives: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Foreign currency and interest rate swaps |
|
|
|
159 |
|
|
|
$ |
159 |
|
$ |
(79 |
) |
80 |
| ||||
Equity derivatives |
|
|
|
|
|
862 |
|
862 |
|
(248 |
) |
614 |
| ||||||
Embedded derivatives |
|
|
|
|
|
295 |
|
295 |
|
|
|
295 |
| ||||||
Total derivatives |
|
— |
|
159 |
|
1,157 |
|
1,316 |
|
(327 |
) |
989 |
| ||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Separate account assets: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Separate account assets |
|
59,772 |
|
|
|
|
|
|
|
|
|
59,772 |
| ||||||
Separate account assets measured at NAV (3) |
|
|
|
|
|
|
|
|
|
|
|
420 |
| ||||||
Total separate account assets (4) |
|
59,772 |
|
— |
|
— |
|
— |
|
— |
|
60,192 |
| ||||||
Total |
|
$ |
59,877 |
|
$ |
61,435 |
|
$ |
4,197 |
|
$ |
1,316 |
|
$ |
(327 |
) |
$ |
126,681 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
FVO debt |
|
|
|
$ |
910 |
|
|
|
|
|
|
|
$ |
910 |
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Derivatives: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Foreign currency and interest rate swaps |
|
|
|
56 |
|
|
|
$ |
56 |
|
$ |
(79 |
) |
(23 |
) | ||||
Equity derivatives |
|
|
|
|
|
$ |
38 |
|
38 |
|
(248 |
) |
(210 |
) | |||||
Embedded derivatives |
|
|
|
|
|
3,702 |
|
3,702 |
|
|
|
3,702 |
| ||||||
Total derivatives |
|
— |
|
56 |
|
3,740 |
|
3,796 |
|
(327 |
) |
3,469 |
| ||||||
Total |
|
— |
|
$ |
966 |
|
$ |
3,740 |
|
$ |
3,796 |
|
$ |
(327 |
) |
$ |
4,379 |
|
(1) Netting adjustments represent the impact of offsetting asset and liability positions held with the same counterparty.
(2) Excludes investments accounted for under the equity method of accounting.
(3) Certain investments that do not have a readily determinable fair value are measured using the NAV per share (or its equivalent) practical expedient and have not been classified in the fair value hierarchy.
(4) Separate account assets are measured at fair value. Investment performance related to separate account assets is offset by corresponding amounts credited to contract holders whose liability is recorded in the separate account liabilities. Separate account liabilities are measured to equal the fair value of separate account assets. Excluded are the separate account assets measured at NAV discussed below.
As a practical expedient to value certain investments that do not have a readily determinable fair value, the Company uses the NAV to determine the fair value. The following table lists information regarding these investments as of December 31, 2020.
Asset Class and Investment |
|
Fair Value |
|
Redemption |
|
Remaining |
|
Redemption |
|
Outstanding |
| ||
|
|
($In Millions) |
| ||||||||||
Private equity funds |
|
$ |
1,498 |
|
None (2) |
|
N/A |
|
N/A |
|
$ |
1,370 |
|
|
|
|
|
|
|
|
|
|
|
|
| ||
Separate account hedge funds |
|
507 |
|
Monthly |
|
None to 3 years |
|
5 - 185 days |
|
— |
| ||
|
|
|
|
Quarterly |
|
|
|
|
|
|
| ||
|
|
|
|
Semi-Annually |
|
|
|
|
|
|
| ||
|
|
|
|
Annually |
|
|
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
|
|
| ||
Total measured at NAV |
|
$ |
2,005 |
|
|
|
|
|
|
|
$ |
1,370 |
|
(1) There are multiple Investment strategies within the separate account hedge funds investing in U.S. and international equity, fixed income, real estate, derivatives, and privately held companies.
(2) Distributions by these investments are generated from liquidation of the underlying assets of the funds, which are determined by the general partner. The Company is not aware of any announcements of planned liquidations.
FAIR VALUE MEASUREMENT
The Codification’s Fair Value Measurements and Disclosures Topic defines fair value as the price that would be received to sell the asset or paid to transfer the liability at the measurement date. This “exit price” notion is a market-based measurement that requires a focus on the value that market participants would assign for an asset or liability.
The following section describes the valuation methodologies used by the Company to measure various types of financial instruments at fair value and the controls that surround the valuation process. The Company reviews its valuation methodologies and controls on an ongoing basis and assesses whether these methodologies are appropriate based on the current economic environment.
FIXED MATURITY, FVO, TRADING, AND EQUITY SECURITIES
The fair values of fixed maturity securities available for sale, FVO, trading, and equity securities are determined by management after considering external pricing sources and internal valuation techniques. For securities with sufficient trading volume, prices are obtained from third party pricing services. For securities that are traded infrequently, fair values are determined after evaluating prices obtained from third party pricing services and independent brokers or are valued internally using various valuation techniques.
The Company’s management analyzes and evaluates prices received from independent third parties and determines whether they are reasonable estimates of fair value. Management’s analysis may include, but is not limited to, review of third-party pricing methodologies and inputs, analysis of recent trades, comparison to prices received from other third parties, and development of internal models utilizing observable market data of comparable securities. The Company assesses the reasonableness of valuations received from independent brokers by considering current market dynamics and current pricing for similar securities.
For prices received from independent pricing services, the Company applies a formal process to challenge any prices received that are not considered representative of fair value. If prices received from independent pricing services are not considered reflective of market activity or representative of fair value, independent non-binding broker quotations are obtained, or an internally-developed valuation is prepared. Upon evaluation, the Company determines which source represents the best estimate of fair value. Overrides of third-party prices to internally-developed valuations of fair value did not produce material differences in the fair values for the majority of the portfolio. In the absence of such market observable activity, management’s best estimate is used.
Fair values determined by internally derived valuation tools use market-observable data if available. Generally, this includes using an actively-traded comparable security as a benchmark for pricing. These internal valuation methods primarily represent discounted cash flow models that incorporate significant assumptive inputs such as spreads, discount rates, default rates, severity, and prepayment speeds. These inputs are analyzed by the Company’s portfolio managers and analysts, investment accountants, and risk managers. Internally-developed estimates may also use unobservable data, which reflect the Company’s own assumptions about the inputs market participants would use.
Most securities priced by a major independent third party pricing service have been classified as Level 2, as management has verified that the significant inputs used in determining their fair values are market observable and appropriate. Externally priced securities for which fair value measurement inputs are not sufficiently transparent, such as securities valued based on independent broker quotations, have been classified as Level 3. Internally valued securities, including adjusted prices received from independent third parties, where significant management assumptions have been utilized in determining fair value, have been classified as Level 3. Securities categorized as Level 1 consist primarily of investments in mutual funds.
The Company applies controls over the valuation process. Prices are reviewed and approved by the Company’s credit analysts that have industry expertise and considerable knowledge of the issuers. Management performs validation checks to determine the completeness and reasonableness of the pricing information, which include, but are not limited to, changes from identified pricing sources, significant or unusual price fluctuations above predetermined tolerance levels from the prior period, and back-testing of fair values against prices of actual trades. A group comprised of the Company’s investment accountants, portfolio managers and analysts, and risk managers meet to discuss any unusual items above the tolerance levels that may have been identified in the pricing review process. These unusual items are investigated, further analysis is performed and resolutions are appropriately documented.
OTHER INVESTMENTS
Other investments include non-marketable equity securities that do not have readily determinable fair value. Certain significant inputs used in determining the fair value of these equities are based on management assumptions or contractual terms with another party that cannot be readily observable in the market. These non-marketable equity securities are classified as Level 3 assets. Also included in other investments are the securities of the 40 Act Funds, which are valued using the same methodology as described above for fixed maturity, FVO, trading, and equity securities.
DERIVATIVE INSTRUMENTS
Derivative instruments are reported at fair value using pricing valuation models, which utilize market data inputs or independent broker quotations or exchange prices for exchange-traded futures. The Company calculates the fair value of derivatives using market standard valuation methodologies for foreign currency and interest rate swaps and equity options. Internal models are used to value the equity total return swaps. The derivatives are valued using mid-market inputs that are predominantly observable in the market. Inputs include, but are not limited to, interest swap rates, foreign currency forward and spot rates, credit spreads and correlations, interest volatility, equity volatility, and equity index levels. On a monthly basis, the Company performs an analysis of derivative valuations, which includes both quantitative and qualitative analyses. Examples of procedures performed include, but are not limited to, review of pricing statistics and trends, analysis of the impacts of changes in the market environment, and review of changes in the market value for each derivative by both risk managers and investment accountants. Internally calculated fair values are reviewed and compared to external broker fair values for reasonableness.
All of the OTC derivatives were priced by valuation models as of December 31, 2020 and 2019. A credit valuation analysis was performed for all derivative positions that are uncollateralized to measure the nonperformance risk that the counterparties to the transaction will be unable to perform under the contractual terms and was determined to be immaterial as of December 31, 2020. Nonperformance risk is the Company’s market-perceived risk of its own or the counterparty’s nonperformance.
Derivative instruments classified as Level 2 primarily include foreign currency and interest rate swaps. The derivative valuations are determined using pricing models with inputs that are observable in the market or can be derived principally from or corroborated by observable market data, primarily interest swap rates, interest rate volatility, and foreign currency forward and spot rates.
Derivative instruments classified as Level 3 include complex derivatives, such as equity options and total return swaps. Also classified in Level 3 are embedded derivatives in certain insurance and reinsurance contracts. These derivatives are valued using pricing models, which utilize both observable and unobservable inputs, primarily interest rate volatility, equity volatility, equity index levels, nonperformance risk, and, to a lesser extent, market fees, and broker quotations. A derivative instrument containing Level 2 inputs will be classified as a Level 3 financial instrument in its entirety if it has at least one significant Level 3 input.
VARIABLE ANNUITY GLB EMBEDDED DERIVATIVES
Fair values for variable annuity GLB and related reinsurance embedded derivatives are calculated based upon significant unobservable inputs using internally developed models because active, observable markets do not exist for those items. As a result, variable annuity GLB and related reinsurance embedded derivatives are categorized as Level 3. Below is a description of the Company’s fair value methodologies for these embedded derivatives.
Fair value is calculated as an aggregation of fair value and additional risk margins including behavior risk margin, mortality risk margin, and credit standing adjustment. The resulting aggregation is reconciled or calibrated, if necessary, to market information that is, or may be, available to the Company, but may not be observable by other market participants. Each of the components described below are unobservable in the market place and requires subjectivity by the Company in determining their value.
· Behavior risk margin: This component adds a margin that market participants would require for the risk that the Company’s assumptions about policyholder behavior used in the fair value model could differ from actual experience. This component includes assumptions about withdrawal utilization and lapse rates.
· Mortality risk margin: This component adds a margin in mortality assumptions, both for decrements for policyholders with GLBs, and for expected payout lifetimes in guaranteed minimum withdrawal benefits.
· Credit standing adjustment: This component makes an adjustment that market participants would make to reflect the chance that GLB obligations or the GLB reinsurance recoverables will not be fulfilled (nonperformance risk).
SEPARATE ACCOUNT ASSETS
Separate account assets are reported at fair value as a summarized total on the consolidated statements of financial condition. The fair value of separate account assets is based on the fair value of the underlying assets. Separate account assets are primarily invested in mutual funds, but also have investments in fixed maturity securities and hedge funds.
Level 1 assets include mutual funds that are valued based on reported NAVs provided by fund managers daily and can be redeemed without restriction. Management performs validation checks to determine the reasonableness of the pricing information, which include, but are not limited to, price fluctuations above predetermined thresholds from the prior day and validation against similar funds or indices. Variances are investigated, further analysis is performed and resolutions are appropriately documented.
Level 2 assets include fixed maturity securities. The pricing methodology and valuation controls are the same as those previously described in fixed maturity securities available for sale.
LEVEL 3 RECONCILIATION
The tables below present reconciliations of the beginning and ending balances of the Level 3 financial assets and liabilities, net, that have been measured at fair value on a recurring basis using significant unobservable inputs.
|
|
|
|
Total Gains or Losses |
|
Transfers |
|
Transfers |
|
|
|
|
|
|
|
|
| |||||||||||
|
|
January 1, |
|
Included in |
|
Included in |
|
Into |
|
Out of |
|
|
|
|
|
|
|
| ||||||||||
|
|
|
Earnings |
|
OCI |
|
Level 3 |
|
Level 3 |
|
Purchases |
|
Sales |
|
Settlements |
|
2020 |
| ||||||||||
|
|
(In Millions) |
| |||||||||||||||||||||||||
Obligations of states and political subdivisions |
|
$ |
22 |
|
|
|
|
|
|
|
|
|
$ |
22 |
|
|
|
$ |
(1 |
) |
$ |
43 |
| |||||
Corporate securities |
|
2,593 |
|
$ |
(31 |
) |
$ |
20 |
|
$ |
746 |
|
$ |
(1,570 |
) |
1,488 |
|
$ |
(109 |
) |
(261 |
) |
2,876 |
| ||||
RMBS |
|
40 |
|
(1 |
) |
|
|
14 |
|
(133 |
) |
110 |
|
|
|
(23 |
) |
7 |
| |||||||||
CMBS |
|
88 |
|
|
|
(10 |
) |
8 |
|
(41 |
) |
5 |
|
|
|
|
|
50 |
| |||||||||
Other asset-backed securities |
|
288 |
|
|
|
42 |
|
35 |
|
(284 |
) |
547 |
|
|
|
(116 |
) |
512 |
| |||||||||
Total fixed maturity securities |
|
3,031 |
|
(32 |
) |
52 |
|
803 |
|
(2,028 |
) |
2,172 |
|
(109 |
) |
(401 |
) |
3,488 |
| |||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Trading securities |
|
|
|
|
|
|
|
2 |
|
(4 |
) |
4 |
|
(2 |
) |
|
|
— |
| |||||||||
Other investments |
|
9 |
|
1 |
|
|
|
|
|
|
|
62 |
|
(61 |
) |
|
|
11 |
| |||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Derivatives, net: (1) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Equity derivatives |
|
824 |
|
1,053 |
|
|
|
|
|
|
|
211 |
|
|
|
(823 |
) |
1,265 |
| |||||||||
Embedded derivatives |
|
(3,407 |
) |
(1,353 |
) |
|
|
|
|
|
|
(663 |
) |
|
|
514 |
|
(4,909 |
) | |||||||||
Total derivatives |
|
(2,583 |
) |
(300 |
) |
— |
|
— |
|
— |
|
(452 |
) |
— |
|
(309 |
) |
(3,644 |
) | |||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Total |
|
$ |
457 |
|
$ |
(331 |
) |
$ |
52 |
|
$ |
805 |
|
$ |
(2,032 |
) |
$ |
1,786 |
|
$ |
(172 |
) |
$ |
(710 |
) |
$ |
(145 |
) |
|
|
|
|
Total Gains or Losses |
|
Transfers |
|
Transfers |
|
|
|
|
|
|
|
|
| |||||||||||
|
|
January 1, |
|
Included in |
|
Included in |
|
Into |
|
Out of |
|
|
|
|
|
|
|
| ||||||||||
|
|
|
Earnings |
|
OCI |
|
Level 3 |
|
Level 3 |
|
Purchases |
|
Sales |
|
Settlements |
|
2019 |
| ||||||||||
|
|
(In Millions) |
| |||||||||||||||||||||||||
Obligations of states and political subdivisions |
|
$ |
23 |
|
|
|
$ |
(1 |
) |
|
|
|
|
|
|
|
|
|
|
$ |
22 |
| ||||||
Corporate securities |
|
1,707 |
|
$ |
(15 |
) |
134 |
|
$ |
156 |
|
$ |
(218 |
) |
$ |
1,080 |
|
$ |
(61 |
) |
$ |
(190 |
) |
2,593 |
| |||
RMBS |
|
10 |
|
|
|
1 |
|
|
|
(315 |
) |
383 |
|
|
|
(39 |
) |
40 |
| |||||||||
CMBS |
|
21 |
|
|
|
4 |
|
2 |
|
(61 |
) |
122 |
|
|
|
|
|
88 |
| |||||||||
Other asset-backed securities |
|
358 |
|
1 |
|
10 |
|
1 |
|
(171 |
) |
157 |
|
(17 |
) |
(51 |
) |
288 |
| |||||||||
Total fixed maturity securities |
|
2,119 |
|
(14 |
) |
148 |
|
159 |
|
(765 |
) |
1,742 |
|
(78 |
) |
(280 |
) |
3,031 |
| |||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Other investments |
|
8 |
|
|
|
|
|
|
|
|
|
1 |
|
|
|
|
|
9 |
| |||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Derivatives, net: (1) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Equity derivatives |
|
84 |
|
923 |
|
|
|
|
|
|
|
222 |
|
|
|
(405 |
) |
824 |
| |||||||||
Embedded derivatives |
|
(1,775 |
) |
(1,206 |
) |
|
|
|
|
|
|
(773 |
) |
|
|
347 |
|
(3,407 |
) | |||||||||
Total derivatives |
|
(1,691 |
) |
(283 |
) |
— |
|
— |
|
— |
|
(551 |
) |
— |
|
(58 |
) |
(2,583 |
) | |||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Total |
|
$ |
436 |
|
$ |
(297 |
) |
$ |
148 |
|
$ |
159 |
|
$ |
(765 |
) |
$ |
1,192 |
|
$ |
(78 |
) |
$ |
(338 |
) |
$ |
457 |
|
(1) Excludes derivative net settlements of ($484) million and ($666) million for the years ended December 31, 2020 and 2019, respectively, that are recorded in net realized investment gain (loss). Excludes synthetic GIC policy fees of $53 million and $49 million for the years ended December 31, 2020 and 2019, respectively, that are recorded in net realized investment gain (loss). Excludes embedded derivative policy fees of $142 million and $132 million for the years ended December 31, 2020 and 2019, respectively, that are recorded in net realized investment gain (loss).
The transfers out of Level 3 fixed maturity securities of $2.0 billion for the year ended December 31, 2020 were driven by the discontinuation of matrix model pricing and use of market observable inputs in valuation methodologies, including the utilization of major independent pricing service information, as well as decreases in interest rates, offset by widening credit spreads.
Amounts included in earnings of Level 3 financial assets and liabilities are as follows:
|
|
Net |
|
Net Realized |
|
OTTI |
|
Total |
| ||||
|
|
(In Millions) |
| ||||||||||
Year Ended December 31, 2020: |
|
|
|
|
|
|
|
|
| ||||
Corporate securities |
|
$ |
7 |
|
$ |
(6 |
) |
$ |
(32 |
) |
$ |
(31 |
) |
RMBS |
|
(1 |
) |
|
|
|
|
(1 |
) | ||||
Total fixed maturity securities |
|
6 |
|
(6 |
) |
(32 |
) |
(32 |
) | ||||
|
|
|
|
|
|
|
|
|
| ||||
Other investments |
|
1 |
|
|
|
|
|
1 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Equity derivatives |
|
|
|
1,053 |
|
|
|
1,053 |
| ||||
Embedded derivatives |
|
|
|
(1,353 |
) |
|
|
(1,353 |
) | ||||
Total derivatives |
|
— |
|
(300 |
) |
— |
|
(300 |
) | ||||
Total |
|
$ |
7 |
|
$ |
(306 |
) |
$ |
(32 |
) |
$ |
(331 |
) |
|
|
Net |
|
Net Realized |
|
|
|
|
| ||||
|
|
Investment |
|
Investment |
|
|
|
|
| ||||
|
|
Income |
|
Gain (Loss) |
|
OTTI |
|
Total |
| ||||
|
|
(In Millions) |
| ||||||||||
Year Ended December 31, 2019: |
|
|
|
|
|
|
|
|
| ||||
Corporate securities |
|
$ |
7 |
|
$ |
(10 |
) |
$ |
(12 |
) |
$ |
(15 |
) |
Other asset-backed securities |
|
|
|
1 |
|
|
|
1 |
| ||||
Total fixed maturity securities |
|
7 |
|
(9 |
) |
(12 |
) |
(14 |
) | ||||
Equity derivatives |
|
|
|
923 |
|
|
|
923 |
| ||||
Embedded derivatives |
|
|
|
(1,206 |
) |
|
|
(1,206 |
) | ||||
Total derivatives |
|
— |
|
(283 |
) |
— |
|
(283 |
) | ||||
Total |
|
$ |
7 |
|
$ |
(292 |
) |
$ |
(12 |
) |
$ |
(297 |
) |
The table below represents the net amount of total gains or losses for the period, attributable to the change in unrealized gain (loss) relating to assets and liabilities classified as Level 3 that were still held at the end of the reporting period.
|
|
Years Ended December 31, |
| ||||
|
|
|
2019 |
| |||
|
|
(In Millions) |
| ||||
Fixed maturity securities (1) |
|
$ |
55 |
|
$ |
119 |
|
|
|
|
|
|
| ||
Derivatives, net: (2) |
|
|
|
|
| ||
Equity derivatives |
|
1,040 |
|
697 |
| ||
Embedded derivatives |
|
(1,413 |
) |
(1,080 |
) | ||
Total |
|
$ |
(318 |
) |
$ |
(264 |
) |
(1) Amounts are recognized in OCI.
(2) Amounts are recognized in net realized investment gain (loss).
The following table presents certain quantitative information of significant unobservable inputs used in the fair value measurement and the sensitivity of the fair value to changes in those inputs for Level 3 assets and liabilities as of December 31, 2020 ($ In Millions).
|
|
Fair Value |
|
Predominant |
|
Significant |
|
Range |
|
Impact of Increase in |
| |
|
|
Asset (Liability) |
|
Valuation Method |
|
Unobservable Inputs |
|
(Weighted Average) |
|
Input on Fair Value (5) |
| |
Obligations of states and political subdivisions |
|
$ |
43 |
|
Discounted cash flow |
|
Spread (1) |
|
816-828 (825) |
|
Decrease |
|
|
|
|
|
Market pricing |
|
Quoted prices (2) |
|
102-125 (106) |
|
Increase |
| |
|
|
|
|
|
|
|
|
|
|
|
| |
Corporate securities |
|
2,876 |
|
Discounted cash flow |
|
Spread (1) |
|
95-1162 (297) |
|
Decrease |
| |
|
|
|
|
Market pricing |
|
Quoted prices (2) |
|
82-135 (102) |
|
Increase |
| |
|
|
|
|
|
|
|
|
|
|
|
| |
RMBS |
|
7 |
|
Market pricing |
|
Quoted prices (2) |
|
102-159 (122) |
|
Increase |
| |
|
|
|
|
|
|
|
|
|
|
|
| |
CMBS |
|
50 |
|
Discounted cash flow |
|
Spread (1) |
|
75-581 (535) |
|
Decrease |
| |
|
|
|
|
|
|
Prepayment rate |
|
0% |
|
N/A |
| |
|
|
|
|
|
|
Default rate |
|
0% |
|
Decrease (6) |
| |
|
|
|
|
|
|
Severity |
|
0% |
|
Decrease (6) |
| |
|
|
|
|
|
|
|
|
|
|
|
| |
Other asset-backed securities |
|
512 |
|
Discounted cash flow |
|
Spread (1) |
|
30-492 (170) |
|
Decrease |
| |
|
|
|
|
Market pricing |
|
Quoted prices (2) |
|
80-131 (109) |
|
Increase |
| |
|
|
|
|
Cap at call price |
|
Call price |
|
100 |
|
N/A |
| |
|
|
|
|
|
|
|
|
|
|
|
| |
Other investments |
|
11 |
|
Redemption value |
|
Redemption value (3) |
|
100 |
|
N/A |
| |
|
|
|
|
|
|
|
|
|
|
|
| |
Equity derivatives (4) |
|
1,265 |
|
Option pricing model |
|
Equity volatility |
|
7% - 78% |
|
Increase (7) |
| |
|
|
|
|
|
|
|
|
|
|
|
| |
Embedded derivatives (4) |
|
(4,909 |
) |
Option pricing techniques |
|
Equity volatility |
|
7% - 78% |
|
Increase (8) |
| |
|
|
|
|
|
|
Mortality: |
|
|
|
|
| |
|
|
|
|
|
|
Ages 0-40 |
|
0.01% - 0.17% |
|
Decrease (9) |
| |
|
|
|
|
|
|
Ages 41-60 |
|
0.05% - 0.55% |
|
Decrease (9) |
| |
|
|
|
|
|
|
Ages 61-120 |
|
0.31% - 100.00% |
|
Decrease (9) |
| |
|
|
|
|
|
|
Mortality improvement |
|
0.00% - 4.59% |
|
Increase (10) |
| |
|
|
|
|
|
|
Withdrawal utilization |
|
0.00% - 99.0% |
|
Varies by product (11) |
| |
|
|
|
|
|
|
Lapse rates |
|
0.00% - 100% |
|
Decrease (12) |
| |
|
|
|
|
|
|
Credit standing adjustment |
|
0.2% - 1.23% |
|
Decrease (13) |
| |
Total |
|
$ |
(145 |
) |
|
|
|
|
|
|
|
|
(1) Range and weighted average are presented in basis points over the benchmark interest rate curve and include adjustments attributable to illiquidity premiums, expected duration, structure, and credit quality.
(2) Independent third-party quotations were used in the determination of fair value.
(3) Represents FHLB common stock that is valued at the contractual amount that will be received upon redemption.
(4) Since the valuation methodology for equity derivatives and embedded derivatives uses a range of inputs that vary at the contract level, presenting a range, rather than weighted average, is more representative of the unobservable input used in the valuation.
(5) The impact of a decrease in input would have the opposite impact on fair value as that presented in the table. For any given annuity contract, each assumption varies throughout the period over which cash flows are projected for purposes of valuing the embedded derivative.
(6) Changes in the assumptions used for the probability of default are accompanied by a directionally similar change in the assumption used for the loss severity and a directionally opposite change in the assumptions used for prepayment rates.
(7) Changes in fair values are based on long U.S. dollar positions and will be inversely impacted for short U.S. dollar positions.
(8) Long-term equity volatilities represent equity volatility beyond the period for which observable equity volatilities are available, and vary by equity index. The assumption is based on historical realized equity volatility.
(9) Mortality rates vary by age, gender, policy year, and mortality segments. Mortality rate assumptions are based on Company experience. There are two mortality segments: the plus segment consists of policies without a lifetime guaranteed minimum withdrawal benefits (GMWB) rider; the minus segment consists of policies with a lifetime GMWB rider. An increase in the mortality assumption results in an increase (decrease) in the fair value for policies in the plus (minus) segment. As of December 31, 2020, the majority of policies in scope are in the minus segment.
(10) Mortality improvement varies by age, gender, calendar year, and mortality segment. Mortality improvement assumptions are based on Company experience. Mortality segments are defined in (9) above. An increase in the mortality improvement assumption results in a decrease (increase) in the fair value for policies in the plus (minus) segment.
(11) The withdrawal utilization assumption estimates the percentage of contractholders with a GMWB benefit who will elect to utilize the benefit. The assumption varies by the type of GMWB, tax qualification status, policy size, and age at rider issue. Withdrawal utilization assumptions are based on Company experience. An increase in the withdrawal utilization assumption results in an increase (decrease) in the fair value for variable (fixed indexed) annuities.
(12) Variable annuity lapse rates vary by policy size, commission option, single/joint life status, surrender charge duration, age, policy month, amount of time until the end of the rider utilization waiting period (if any), and the amount by which the guaranteed amount is greater than the account value. Fixed indexed annuity lapse rates consist of a base lapse rate that varies by product and policy year, and a dynamic adjustment based on how the credited rate on the contract compares to competitor rates. Lapse rate assumptions are based on Company experience.
(13) The credit standing adjustment represents the Company’s nonperformance risk spread, and varies by duration. The assumption is based on Barclays financial credit spreads.
NONRECURRING FAIR VALUE MEASUREMENTS
Certain assets are measured at fair value on a nonrecurring basis. The fair value measurement is nonrecurring as these assets are measured at fair value only when there is a triggering event (e.g., an evidence of impairment). The following table presents assets measured at fair value (at the relevant remeasurement date) that are still held as of December 31, 2020 and 2019 (In Millions):
|
|
December 31, |
| |||
|
|
|
| |||
Mortgage loans |
|
$ |
115 |
|
— |
|
Mortgage Loans
The fair value after measurement for impaired mortgage loans was based on the valuation of the underlying real estate collateral net of estimated costs to sell. These loans are classified as Level 3 assets.
The Company did not have any other significant nonfinancial assets or liabilities measured at fair value on a nonrecurring basis resulting from impairments as of December 31, 2020 and 2019.
The carrying amount and fair value of the Company’s financial instruments that are not carried at fair value under the Codification’s Financial Instruments Topic are as follows:
|
|
Fair Value |
|
|
| ||||||||||
|
|
Hierarchy |
|
Carrying |
|
|
|
Carrying |
|
|
| ||||
|
|
Level |
|
Amount |
|
Fair Value |
|
Amount |
|
Fair Value |
| ||||
|
|
(In Millions) |
| ||||||||||||
Assets: |
|
|
|
|
|
|
|
|
|
|
| ||||
Mortgage loans |
|
Level 3 |
|
$ |
17,842 |
|
$ |
18,205 |
|
$ |
16,388 |
|
$ |
17,391 |
|
Policy loans |
|
Level 3 |
|
7,700 |
|
7,700 |
|
7,950 |
|
7,950 |
| ||||
Cash and cash equivalents |
|
Level 1 |
|
5,490 |
|
5,490 |
|
6,097 |
|
6,097 |
| ||||
Restricted cash |
|
Level 1 |
|
16 |
|
16 |
|
14 |
|
14 |
| ||||
Liabilities: |
|
|
|
|
|
|
|
|
|
|
| ||||
Funding agreements |
|
Level 2 |
|
1,999 |
|
2,021 |
|
167 |
|
168 |
| ||||
Annuity and deposit liabilities |
|
Level 3 |
|
28,483 |
|
29,481 |
|
26,962 |
|
26,962 |
| ||||
Short-term debt |
|
Level 2 |
|
187 |
|
187 |
|
113 |
|
113 |
| ||||
Long-term debt |
|
Level 2 |
|
4,596 |
|
5,128 |
|
4,449 |
|
4,785 |
| ||||
This table excludes the following financial instruments: accrued investment income receivables and payables, cash collateral liability for securities lending, and collateral receivables and payables for derivatives. The fair value of these financial instruments, which are primarily classified as Level 2, approximates carrying value as they are short-term in nature such that there is minimal risk of material changes in fair value due to changes in interest rates. The following methods and assumptions were used to estimate the fair value of these financial instruments as of December 31, 2020 and 2019:
MORTGAGE LOANS
The fair value of the mortgage loan portfolio is determined by discounting the estimated future cash flows, using current rates that are applicable to similar credit quality, property type and average maturity of the composite portfolio.
POLICY LOANS
Policy loans are not separable from their associated insurance contract and bear no credit risk since they do not exceed the contract’s cash surrender value, making these assets fully secured by the cash surrender value of the contracts. Therefore, the carrying amount of the policy loans is a reasonable approximation of their fair value.
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH
The carrying amounts approximate fair values due to the short-term maturities of these instruments.
FUNDING AGREEMENTS
The primary methods used to estimate the fair value of funding agreements are based on the rates currently offered for deposits of similar remaining maturities, or discounted cash flow methodologies using current market risk-free interest rates and adding a spread to reflect nonperformance risk.
ANNUITY AND DEPOSIT LIABILITIES
Annuity and deposit liabilities primarily include fixed indexed and fixed rate deferred annuities without mortality or morbidity risks and structured settlement and other payout annuities without life contingencies. Fixed indexed and fixed rate deferred annuities, which can be withdrawn upon demand, are carried at the accumulated account values, which approximate fair value. Fixed indexed annuity embedded derivatives are presented separately from annuity and deposit liabilities. The fair value of structured settlement and other payout annuities without life contingencies is estimated based on discounted cash flow methodologies using observable and unobservable inputs.
DEBT
The carrying amount of short-term debt is a reasonable estimate of its fair value because the interest rates are variable and based on current market rates. The fair value of long-term debt is based on market quotes or discounting estimated future cash flows using market rates, except for certain VIE debt and non-recourse debt, for which an analysis is performed to ensure the carrying amounts are reasonable estimates of their fair values.
12. OTHER COMPREHENSIVE INCOME (LOSS)
The Company displays comprehensive income (loss) and its components on the consolidated statements of comprehensive income (loss) and consolidated statements of equity. The balance of and changes in each component of AOCI attributable to the Company are as follows:
|
|
Unrealized |
|
|
|
|
|
|
| ||||
|
|
Gain (Loss) on |
|
Gain (Loss) |
|
|
|
|
| ||||
|
|
Securities Available |
|
on |
|
Other, |
|
Total |
| ||||
|
|
for Sale, Net (1) |
|
Derivatives |
|
Net |
|
AOCI |
| ||||
|
|
(In Millions) |
| ||||||||||
Balance, December 31, 2017 |
|
$ |
1,537 |
|
$ |
93 |
|
$ |
(17 |
) |
$ |
1,613 |
|
Cumulative effect of adoption of accounting change (Note 1) |
|
(3 |
) |
|
|
|
|
(3 |
) | ||||
Revised balance, January 1, 2018 |
|
1,534 |
|
93 |
|
(17 |
) |
1,610 |
| ||||
Change in OCI before reclassifications |
|
(1,978 |
)(2) |
30 |
|
(8 |
) |
(1,956 |
) | ||||
Income tax (expense) benefit |
|
416 |
|
(6 |
) |
|
|
410 |
| ||||
Loss reclassified from AOCI |
|
12 |
|
12 |
|
|
|
|
| ||||
Income tax benefit |
|
(3 |
) |
|
|
|
|
(3 |
) | ||||
Balance, December 31, 2018 |
|
(19 |
) |
117 |
|
(25 |
) |
73 |
| ||||
Change in OCI before reclassifications |
|
3,177 |
(2) |
6 |
|
9 |
|
3,192 |
| ||||
Income tax expense |
|
(667 |
) |
|
|
(2 |
) |
(669 |
) | ||||
(Gain) loss reclassified from AOCI |
|
14 |
|
(5 |
) |
|
|
9 |
| ||||
Income tax expense (benefit) |
|
(3 |
) |
1 |
|
|
|
(2 |
) | ||||
Balance, December 31, 2019 |
|
2,502 |
|
119 |
|
(18 |
) |
2,603 |
| ||||
Change in OCI before reclassifications |
|
2,440 |
(2) |
(50 |
) |
11 |
|
2,401 |
| ||||
Income tax (expense) benefit |
|
(510 |
) |
11 |
|
(5 |
) |
(504 |
) | ||||
(Gain) loss reclassified from AOCI |
|
30 |
|
(1 |
) |
|
|
29 |
| ||||
Income tax benefit |
|
(6 |
) |
|
|
|
|
(6 |
) | ||||
Balance, December 31, 2020 |
|
$ |
4,456 |
|
$ |
79 |
|
$ |
(12 |
) |
$ |
4,523 |
|
(1) See Note 4 and Note 8 for information related to DAC and future policy benefits.
(2) Includes allocation of the combined net holding increase (reduction) from DAC, URR, and future policy benefits of ($1,323) million, ($1,507) million, and $848 million for the years ended December 31, 2020, 2019, and 2018, respectively.
RECLASSIFICATIONS FROM AOCI
The table below presents amounts reclassified from each component of AOCI and their locations on the consolidated statements of operations. Amounts are shown gross of tax.
|
|
Years Ended December 31, |
| |||||||
Reclassification adjustments: |
|
2020 |
|
2019 |
|
2018 |
| |||
|
|
(In Millions) |
| |||||||
Unrealized (gain) loss on securities available for sale, net: |
|
|
|
|
|
|
| |||
Sale of securities available for sale (1) |
|
$ |
(31 |
) |
$ |
(5 |
) |
$ |
3 |
|
OTTI recognized on securities available for sale (2) |
|
61 |
|
19 |
|
9 |
| |||
Total unrealized (gain) loss on securities available for sale, net |
|
30 |
|
14 |
|
12 |
| |||
|
|
|
|
|
|
|
| |||
Derivatives reclassification, net |
|
(1 |
) |
(5 |
) |
|
| |||
|
|
|
|
|
|
|
| |||
Total amounts reclassified from AOCI |
|
$ |
29 |
|
$ |
9 |
|
$ |
12 |
|
Location on the consolidated statements of operations:
(1) Net realized investment gain (loss)
(2) OTTI
13. REINSURANCE
The accounting for reinsurance requires extensive use of assumptions and estimates, particularly related to the future performance of the underlying business and the potential impact of counterparty credit risk. The Company periodically reviews, and modifies as appropriate, the estimates and assumptions used to establish assets and liabilities relating to assumed and ceded reinsurance. Reinsurance receivables, included in other assets, were $1,398 million and $1,157 million as of December 31, 2020 and 2019, respectively. Reinsurance payables, included in other liabilities, were $228 million and $290 million as of December 31, 2020 and 2019, respectively.
The components of insurance premiums are as follows:
|
|
Years Ended December 31, |
| |||||||
|
|
|
2019 |
|
2018 |
| ||||
|
|
(In Millions) |
| |||||||
Direct premiums |
|
$ |
2,963 |
|
$ |
2,761 |
|
$ |
1,719 |
|
Reinsurance assumed (1) |
|
903 |
|
938 |
|
996 |
| |||
Reinsurance ceded |
|
(471 |
) |
(434 |
) |
(437 |
) | |||
Insurance premiums |
|
$ |
3,395 |
|
$ |
3,265 |
|
$ |
2,278 |
|
(1) Included are $69 million, $56 million and $56 million of assumed premiums from PLRL for each of the years ended December 31, 2020, 2019, and 2018, respectively.
14. INCOME TAXES
The provision (benefit) for income taxes from continuing operations is as follows:
|
|
Years Ended December 31, |
| |||||||
|
|
|
2019 |
|
2018 |
| ||||
|
|
(In Millions) |
| |||||||
Current |
|
$ |
(162 |
) |
$ |
142 |
|
$ |
(133 |
) |
Deferred |
|
(111 |
) |
(77 |
) |
207 |
| |||
Total |
|
$ |
(273 |
) |
$ |
65 |
|
$ |
74 |
|
A reconciliation of the provision (benefit) for income taxes from continuing operations based on the Federal corporate statutory tax rate of 21% for income taxes from continuing operations is as follows:
|
|
Years Ended December 31, |
| |||||||
|
|
|
2019 |
|
2018 |
| ||||
|
|
(In Millions) |
| |||||||
Provision (benefit) for income taxes at the statutory rate |
|
$ |
(165 |
) |
$ |
129 |
|
$ |
162 |
|
Benefit of NOL carryback under CARES Act |
|
(84 |
) |
|
|
|
| |||
Dividends received deduction |
|
(31 |
) |
(31 |
) |
(31 |
) | |||
Tax credits |
|
(17 |
) |
(24 |
) |
(33 |
) | |||
Remeasurement of operating deferred taxes |
|
(49 |
) |
|
|
|
| |||
Tax on foreign investments |
|
10 |
|
|
|
|
| |||
Foreign tax credit adjustments |
|
8 |
|
5 |
|
41 |
| |||
Other |
|
6 |
|
(14 |
) |
(16 |
) | |||
Provision (benefit) for income taxes from continuing operations |
|
$ |
(273 |
) |
$ |
65 |
|
$ |
74 |
|
The net deferred tax liability, included in other liabilities, is comprised of the following tax effected temporary differences:
|
|
| |||||
|
|
|
2019 |
| |||
|
|
(In Millions) |
| ||||
Deferred tax assets: |
|
|
|
|
| ||
Investments including derivatives |
|
$ |
872 |
|
$ |
638 |
|
Policyholder reserves |
|
719 |
|
610 |
| ||
Deferred compensation |
|
62 |
|
65 |
| ||
Other |
|
165 |
|
148 |
| ||
Total deferred tax assets |
|
1,818 |
|
1,461 |
| ||
|
|
|
|
|
| ||
Deferred tax liabilities: |
|
|
|
|
| ||
DAC |
|
(770 |
) |
(715 |
) | ||
Derivatives |
|
(622 |
) |
(540 |
) | ||
Partnership investments |
|
(78 |
) |
(67 |
) | ||
Depreciation |
|
(106 |
) |
(8 |
) | ||
Other |
|
(10 |
) |
(10 |
) | ||
Total deferred tax liabilities |
|
(1,586 |
) |
(1,340 |
) | ||
|
|
|
|
|
| ||
Net deferred tax asset |
|
232 |
|
121 |
| ||
Unrealized gain on derivatives and securities available for sale |
|
(1,206 |
) |
(701 |
) | ||
Other adjustments |
|
4 |
|
9 |
| ||
Net deferred tax liability |
|
$ |
(970 |
) |
$ |
(571 |
) |
The Company does not have any NOL or tax credit carryovers as of December 31, 2020.
Management has assessed that it is more likely than not that the Company’s deferred tax assets as of December 31, 2020 will be realized through projected future taxable income and the reversal of existing deferred tax liabilities listed above.
The following is a tabular reconciliation of the total amounts of unrecognized tax benefits (In Millions):
Balance as of January 1, 2018 |
|
$ |
— |
|
Increase - prior year positions |
|
41 |
| |
Balance as of December 31, 2018 |
|
41 |
| |
Increase - prior year positions |
|
5 |
| |
Increase - current year positions |
|
41 |
| |
Balance as of December 31, 2019 |
|
87 |
| |
Increase - prior year positions |
|
18 |
| |
Balance as of December 31, 2020 |
|
$ |
105 |
|
As of December 31, 2020, the Company had $105 million of unrecognized tax benefit which relate primarily to foreign tax credits previously claimed and state tax on intercompany transactions.
The Company does not expect material changes to its unrecognized tax benefits for the twelve month period following the reporting date.
PMHC files income tax returns in U.S. Federal and various state jurisdictions. PMHC is under continuous audit by the Internal Revenue Service (IRS) and is audited periodically by some state taxing authorities. The IRS is currently examining PMHC’s tax returns for the years ended December 31, 2013 through 2016, and will begin the examination of tax years 2017 and 2018 in the first quarter of 2021. The exam of the Federal tax returns through tax years ended December 31, 2012 has been completed and certain issues are under appeals. The State of California is auditing the tax year ended December 31, 2009 and certain issues are under appeals. The Company does not expect the current Federal and California audits to result in any material assessments.
On December 22, 2017, tax reform legislation formally known as the Tax Cuts and Jobs Act (the Act) was enacted, which significantly revised the U.S. corporate income tax system. Following the guidance in Staff Accounting Bulletin No. 118, the Company recorded certain effects of the Act as provisional estimates for the year ended December 31, 2017 and completed the accounting for the tax impact of the Act based on legislative updates during the year ended December 31, 2018.
Specifically, an adjustment was recorded during the year ended December 31, 2018 for additional income tax benefit of $49 million for the remeasurement of the Company’s U.S. net deferred tax liabilities as a result of certain tax positions taken on the 2017 tax return filing.
15. TRANSACTIONS WITH RELATED PARTIES
PLFA serves as the investment adviser for the PSF, the Pacific Funds Series Trust (PFST), and the Pacific Life Investment Grade Trade Receivable Fund. Investment advisory and other fees are based primarily upon the NAV of the underlying portfolios. These fees, included in investment advisory fees, amounted to $251 million, $300 million, and $334 million for the years ended December 31, 2020, 2019, and 2018, respectively. Pacific Life provides general administrative or investment management services to PMHC, PLC and other affiliates. These fees amounted to $17 million, $11 million, and $13 million for the years ended December 31, 2020, 2019, and 2018, respectively.
Additionally, the PSF and PFST have service and other plans whereby the funds pay Pacific Select Distributors, LLC (PSD), a wholly owned broker-dealer subsidiary of Pacific Life, as distributor of the funds, a service fee in connection with services rendered to or procured for shareholders of the fund or their variable life insurance policyholders and variable annuity contract owners. These services may include, but are not limited to, payment of compensation to broker-dealers, including PSD itself, and other financial institutions and organizations, which assist in providing any of the services. For the years ended December 31, 2020, 2019, and 2018, PSD received $93 million, $100 million, and $111 million, respectively, in service and other fees from the PSF and PFST, which are recorded in other income.
Pacific Life and PL&A’s structured settlement transactions are typically designed such that an affiliated assignment company assumes settlement obligations from external parties in exchange for consideration. The affiliated assignment company then funds the assumed settlement obligations by purchasing annuity contracts from Pacific Life and PL&A. Consequently, substantially all of the Pacific Life and PL&A’s structured settlement annuities are sold to an affiliated assignment company. Included in the liability for future policy benefits are insurance contracts with the affiliated assignment company with contract values of $4.6 billion and $4.4 billion as of December 31, 2020 and 2019, respectively. Related to the insurance contracts, Pacific Life and PL&A received $368 million, $567 million and $469 million of insurance premiums and paid $292 million, $270 million, and $235 million of policy benefits for the years ended December 31, 2020, 2019, and 2018, respectively. In addition, included in the liability for policyholder account balances are investment contracts with the affiliated assignment company of $4.0 billion and $3.7 billion as of December 31, 2020 and 2019, respectively.
16. COMMITMENTS AND CONTINGENCIES
COMMITMENTS
The Company has outstanding commitments that may be funded to make investments primarily in mortgage loans, limited partnerships, fixed maturity securities, and other investments, as follows (In Millions):
|
|
|
|
|
|
Fixed Maturity |
|
|
| ||||
|
|
|
|
Limited |
|
Securities and |
|
|
| ||||
Years Ending December 31: |
|
Mortgage Loans |
|
Partnerships |
|
Other Investments |
|
Total |
| ||||
2021 |
|
$ |
438 |
|
$ |
588 |
|
$ |
1,278 |
|
$ |
2,304 |
|
2022 |
|
309 |
|
372 |
|
|
|
681 |
| ||||
2023 |
|
210 |
|
350 |
|
|
|
560 |
| ||||
2024 |
|
22 |
|
325 |
|
|
|
347 |
| ||||
2025 |
|
|
|
296 |
|
|
|
296 |
| ||||
Thereafter |
|
|
|
331 |
|
2 |
|
333 |
| ||||
Total |
|
$ |
979 |
|
$ |
2,262 |
|
$ |
1,280 |
|
$ |
4,521 |
|
The Company leases office facilities under various operating leases, which in most, but not all cases, are noncancelable. Rent expense, which is included in operating and other expenses, in connection with these leases was $12 million, $10 million, and $10 million for the years ended December 31, 2020, 2019, and 2018, respectively. Aggregate minimum future office lease commitments are as follows (In Millions):
Years Ending December 31: |
|
|
| |
2021 |
|
$ |
11 |
|
2022 through 2025 |
|
40 |
| |
2026 and thereafter |
|
18 |
| |
Total |
|
$ |
69 |
|
Pacific Life entered into agreements with PLRL, Pacific Life Re (Australia) Pty Limited (PLRA) and, effective in 2020, of Pacific Life Re International Limited (RIBM), all such entities being wholly owned indirect subsidiaries of Pacific LifeCorp, to guarantee the performance of reinsurance obligations of PLRL, PLRA, and RIBM, respectively. These guarantees are secondary to the guarantee provided by Pacific LifeCorp and would only be triggered in the event of nonperformance by PLRL, PLRA, or RIBM (in respect in their guarantees) and Pacific LifeCorp. Management believes that additional obligations, if any, related to the guarantee agreements are not likely to have a material adverse effect on the Company’s consolidated financial statements.
Pacific Life had an agreement with Pacific Life Reinsurance Company II Limited (PLRC), an exempt life insurance company domiciled in Barbados and wholly owned by Pacific Life, to guarantee the performance of reinsurance obligations of PLRC. Effective in 2020, all business in PLRC has been novated out of the entity and into RGBM and the Canada branch of PLRL. PLRC was subsequently dissolved in December of 2020.
Pacific Life guarantees the performance of reinsurance obligations of PLRL, including the reinsurance obligations assumed by its Canada Branch, which includes the business novated from PLRC. Effective in 2020, Pacific Life entered into an agreement with RGBM to guarantee the reinsurance obligations of the business novated from PLRC. Management believes that additional obligations related to the guarantee agreements are not likely to have a material adverse effect on the Company’s consolidated financial statements.
Pacific Life has a commitment to provide funds, on Pacific LifeCorp’s behalf, of up to 165 million pound sterling to PLRL. This commitment is secondary to Pacific LifeCorp and is contingent on the nonperformance by Pacific LifeCorp. Management believes that additional obligations, if any, related to this commitment are not likely to have a material adverse effect on the Company’s consolidated financial statements.
CONTINGENCIES - LITIGATION
The Company is a respondent in a number of legal proceedings, some of which involve allegations for extra-contractual damages. Although the Company is confident of its position in these matters, success is not a certainty and a judge or jury could rule against the Company. In the opinion of management, the outcome of such proceedings is not likely to have a material adverse effect on the Company’s consolidated financial statements. The Company believes adequate provision has been made in its consolidated financial statements for all probable and reasonably estimable losses for litigation claims against the Company.
CONTINGENCIES - IRS REVENUE RULING
In 2007, the IRS issued Rev. Rul. 2007-54, interpreting then-current tax law regarding the computation of the Dividends Received Deduction (DRD). Later in 2007, the IRS issued Revenue Ruling 2007-61, suspending Rev. Rul. 2007-54 and indicating that the IRS would re-address this issue in a future regulation project. In 2014, the IRS issued Rev. Rul. 2014-7, stating that it would not address this issue through regulation, but instead would defer to legislative action. Rev. Rul. 2014-7 also expressly superseded Rev. Rul. 2007-54, and declared Rev. Rul. 2007-61 obsolete. With the enactment of the Tax Cuts and Jobs Act in December 2017, DRD computations have been modified effective January 1, 2018. Therefore, the Company does not expect that any of the rulings described above will affect DRD computations in the future. However, in open tax years before 2018, the Company could still lose a substantial portion of its DRD claims, which could in turn have a material adverse effect on the Company’s consolidated financial statements.
CONTINGENCIES - OTHER
In the course of its business, the Company provides certain indemnifications related to dispositions, acquisitions, investments, lease agreements or other transactions that are triggered by, among other things, breaches of representations, warranties or covenants provided by the Company. These obligations are typically subject to time limitations that vary in duration, including contractual limitations and those that arise by operation of law, such as applicable statutes of limitation. The Company is also subject to state and federal regulatory inquiries and examinations from time to time, which could result in fines or penalties. Because the amounts of these types of indemnifications and regulatory actions are often not explicitly stated, the overall maximum amount of the obligation under such indemnifications and regulatory actions cannot be reasonably estimated. The Company has not historically made material payments for these matters. While the estimated maximum potential amount of future payments under these obligations is not determinable due to the lack of a stated maximum liability for certain matters, the Company may record a contingent reserve for such matters. Management believes that judgments, if any, against the Company related to such matters are not likely to have a material adverse effect on the Company’s consolidated financial statements.
Most of the jurisdictions in which the Company is admitted to transact business require life insurance companies to participate in guaranty associations, which are organized to pay contractual benefits owed pursuant to insurance policies issued by insolvent life insurance companies. These associations levy assessments, up to prescribed limits, on all member companies in a particular state based on the proportionate share of premiums written by member companies in the lines of business in which the insolvent insurer operated. The Company has not received notification of any insolvency that is expected to result in a material guaranty fund assessment.
The Company has ceded and assumed reinsurance contracts in place with a reinsurer whose financial stability has deteriorated. In March 2019, the reinsurer’s domiciliary state regulator issued a rehabilitation and injunction order, in which the regulator shall conduct and continue business of the reinsurer. As of December 31, 2020, the Company did record an immaterial impairment, though the Company does not expect the financial deterioration of the reinsurer to have a material adverse effect on the Company’s consolidated financial statements.
In connection with the operations of certain subsidiaries, the Company has made commitments to provide for additional capital funding as may be required.
See Note 2 for discussion of contingencies related to reinsurance of statutory reserves to affiliates.
See Note 7 for discussion of contingencies related to derivative instruments.
See Note 14 for discussion of other contingencies related to income taxes.
Part II
PART C: OTHER INFORMATION (Pacific Choice Income)
Item 24. Financial Statements and Exhibits
(a) Financial Statements
Part A: None | ||||
Part B: | ||||
(1) Registrant’s Financial Statements | ||||
Audited Financial Statements dated as of December 31, 2020 and for each of the periods presented, included in Part B, include the following for Separate Account A: | ||||
Statements of Assets and Liabilities Statements of Operations Statements of Changes in Net Assets Notes to Financial Statements Report of Independent Registered Public Accounting Firm | ||||
(2) Depositor’s Financial Statements | ||||
Audited Consolidated Financial Statements dated as of December 31, 2020 and 2019, and for each of the three years in the period ended December 31, 2020, included in Part B, include the following for Pacific Life: | ||||
Independent Auditors’ Report Consolidated Statements of Financial Condition Consolidated Statements of Operations Consolidated Statements of Stockholder’s Equity Consolidated Statements of Cash Flows Notes to Consolidated Financial Statements | ||||
(b) Exhibits
1. | (a) | Resolution of the Board of Directors of the Depositor authorizing establishment of Separate Account A and Memorandum establishing Separate Account A; included in Registrant’s Form N-4, File No. 033-88460, Accession No. 0000898430-96-001377 filed on April 19, 1996, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/0001017062-98-000945.txt | |
(b) | Resolution of the Board of Directors of Pacific Life Insurance Company authorizing conformity to the terms of the current Bylaws; included in Registrant’s Form N-4, File No. 033-88460, Accession No. 0001017062-98-000945 filed on April 29, 1998, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/0001017062-98-000945.txt | ||
2. | Not applicable | ||
3. | (a) | Distribution Agreement between Pacific Life Insurance Company, Pacific Life & Annuity Company and |
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Pacific Select Distributors, Inc. (PSD) (Amended and Restated); included in Registrant’s Form N-4, File No. 333-60833, Accession No. 0000950123-11-061492 filed on June 24, 2011, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000095012311061492/a59509aexv99w3xay.htm | |||
(b) | Form of Selling Agreement between Pacific Life, PSD and Various Broker Dealers; included in Registrant’s Form N-4, File No. 033-88460, Accession No. 0000892569-06-000528 filed on April 18, 2006, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000089256906000528/a12992exv99w3xby.htm | ||
(c) | Distribution Agreement between Pacific Life Insurance Company, Pacific Life & Annuity Company and Pacific Select Distributors, LLC (PSD) (Amended and Restated); Included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001104659-17-024827 filed on April 20, 2017, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000110465917024827/a16-17092_1ex99d3dc.htm | ||
4. | (a) | Individual Flexible Premium Deferred Variable Annuity Contract (Form No. ICC20:10-1020); included in Registration Statement on Form N-4, File No. 333-236927, Accession No. 0001104659-20-029802, filed on March 6, 2020, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000110465920029802/a20-11372_1ex99d4a.htm | |
(1) | Contract Specifications (Form No. ICC20:10-1020-CS7); included in Registration Statement on Form N-4, File No. 333-236927, Accession No. 0001104659-20-029802, filed on March 6, 2020, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000110465920029802/a20-11372_1ex99d4a1.htm | ||
(b) | Section 457(b) Plan Rider (Form No. ICC12:20-1271); included in Registration Statement on Form N-4, File No. 333-184973, Accession No. 0000950123-13-000795 filed on February 5, 2013, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000095012313000795/a60352a1exv99wx4yxcy.htm | ||
(c) | Individual Retirement Annuity Rider (Form No. ICC12:20-1266); included in Registration Statement on Form N-4, File No. 333-184973, Accession No. 0000950123-13-000795 filed on February 5, 2013, and incorporated by reference herein. This exhibit can be found a thttp://www.sec.gov/Archives/edgar/data/935823/000095012313000795/a60352a1exv99wx4yxdy.htm | ||
(d) | Roth Individual Retirement Annuity Rider (Form No. ICC12:20-1267); included in Registration Statement on Form N-4, File No. 333-184973, Accession No. 0000950123-13-000795 filed on February 5, 2013, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000095012313000795/a60352a1exv99wx4yxey.htm | ||
(e) | SIMPLE Individual Retirement Annuity Rider (Form No. ICC12:20-1268); included in Registration Statement on Form N-4, File No. 333-184973, Accession No. 0000950123-13-000795 filed on February 5, 2013, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000095012313000795/a60352a1exv99wx4yxfy.htm | ||
(f) | Qualified Retirement Plan Rider (Form No. ICC12:20-1269); included in Registration Statement on Form N-4, File No. 333-184973, Accession No. 0000950123-13-000795 filed on February 5, 2013, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000095012313000795/a60352a1exv99wx4yxgy.htm | ||
(g) | DCA Plus Fixed Option Rider (Form No. ICC 11:20-1219); included in Registrant’s Form N-4, File No. 333-175279, Accession No. 0000950123-11-063391 filed on July 1, 2011, and incorporated by reference herein. This exhibit can be found at |
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http://www.sec.gov/Archives/edgar/data/935823/000095012311063391/a59352n4exv99w4xmy.htm | ||
(h) | Guaranteed Withdrawal Benefit XXIII Rider-Single Life (Enhanced Income Select 2) (Form No. ICC20:20-1021); included in Registration Statement on Form N-4, File No. 333-236927, Accession No. 0001104659-20-029802, filed on March 6, 2020, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000110465920029802/a20-11372_1ex99d4h.htm | |
(i) | Guaranteed Withdrawal Benefit XXIII Rider-Joint Life (Enhanced Income Select 2) (Form No. ICC12:20-1022); included in Registration Statement on Form N-4, File No. 333-236927, Accession No. 0001104659-20-029802, filed on March 6, 2020, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000110465920029802/a20-11372_1ex99d4i.htm | |
(j) | Guaranteed Withdrawal Benefit XXII Rider-Single Life (Future Income Generator) (Form No. ICC19:20-1427); included in Registration Statement on Form N-4, File No. 333-236927, Accession No. 0001104659-20-029802, filed on March 6, 2020, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000110465920029802/a20-11372_1ex99d4j.htm | |
(k) | Guaranteed Withdrawal Benefit XXII Rider-Joint Life (Future Income Generator) (Form No. ICC19:20-1428); included in Registration Statement on Form N-4, File No. 333-236927, Accession No. 0001104659-20-029802, filed on March 6, 2020, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000110465920029802/a20-11372_1ex99d4k.htm | |
(l) | Return of Purchase Payments Death Benefit Rider (Form No. ICC20:20-1020); included in Registration Statement on Form N-4, File No. 333-236927, Accession No. 0001104659-20-029802, filed on March 6, 2020, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000110465920029802/a20-11372_1ex99d4l.htm | |
5. | (a) | Variable Annuity Application (Form No. ICC20: 25-1020); included in Registration Statement on Form N-4, File No. 333-236927, Accession No. 0001104659-20-095320, filed on August 14, 2020, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000110465920095320/a20-26310_1ex99d5.htm |
6. | (a) | Pacific Life’s Articles of Incorporation; included in Registrant’s Form N-4, File No. 033-88460, Accession No. 0001017062-98-000945 filed on April 29, 1998, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/0001017062-98-000939.txt |
(b) | By-laws of Pacific Life; included in Registrant’s Form N-4, File No. 033-88460, Accession No. 0001017062-98-000945 filed on April 29, 1998, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/0001017062-98-000945.txt | |
(c) | Pacific Life’s Restated Articles of Incorporation; included in Registrant’s Form N-4, File No. 033-88460, Accession No. 0000892569-06-000528 filed on April 18, 2006, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000089256906000528/a12992exv99w6xcy.htm | |
(d) | By-laws of Pacific Life As Amended September 1, 2005; included in Registrant’s Form N-4, File No. 033-88460, Accession No. 0000892569-06-000528 filed on April 18, 2006, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000089256906000528/a12992exv99w6xdy.htm | |
7. | Reinsurance Agreement with Union Hamilton; Included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001193125-15-346556 filed on October 19, 2015 and incorporated by reference herein. This exhibit can be found at |
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http://www.sec.gov/Archives/edgar/data/935823/000119312515346556/d96269dex997.htm | |||
8. | (a) | Pacific Select Fund Participation Agreement; included in Registrant’s Form N-4, File No. 033-88460, Accession No. 0001017062-01-500083 filed on April 25, 2001, and incorporated by reference herein. This exhibit can be found at https://www.sec.gov/Archives/edgar/data/935823/000101706201500083/dex998a.txt | |
(b) | Fund Participation Agreement Between Pacific Life Insurance Company, Pacific Select Distributions, Inc., American Funds Insurance Series, American Funds Distributors, and Capital Research and Management Company; included in Registrant’s Form N-4, File No. 333-93059, Accession No. 0000892569-05-000253 filed on April 19, 2005, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000089256905000253/a03608a3exv99w8xey.htm | ||
(c) | Form of BlackRock Variable Series Fund, Inc. (formerly called Merrill Lynch Variable Series Fund, Inc.) Participation Agreement; included in Registrant’s Form N-4, File No. 333-136597, Accession No. 0000892569-08-000961 filed on July 2, 2008, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000089256908000961/a41434aexv99w8xey.htm | ||
(1) | First Amendment to Participation Agreement; included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001193125-13-399380 filed on October 15, 2013, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000119312513399380/d609046dex998d1.htm | ||
(2) | Second Amendment to Participation Agreement; included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001193125-13-399380 filed on October 15, 2013, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000119312513399380/d609046dex998d2.htm | ||
(3) | Third Amendment to Participation Agreement; included in Registrant’s Form N-4, File No. 333-136597, Accession No. 0000950123-10-036152 filed on April 20, 2010, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000095012310036152/a52638exv99w8xeyx1y.htm | ||
(4) | Fourth Amendment to Participation Agreement; included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001193125-13-399380 filed on October 15, 2013, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000119312513399380/d609046dex998d4.htm | ||
(5) | Fifth Amendment to Participation Agreement; included in Registrant’s Form N-4, File No. 333-160772, Accession No. 0001193125-14-310473 filed on August 15, 2014, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000119312514310473/d767546dex998e5.htm | ||
(6) | Sixth Amendment to Participation Agreement; included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001104659‐19‐022568 filed on April 19, 2019, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000110465919022568/a19-5919_1ex99d8dd6.htm | ||
(d) | Franklin Templeton Variable Insurance Products Trust Participation Agreement; included in Registrant’s Form N-4, File No. 333-136597, Accession No. 0000892569-08-000961 filed on July 2, 2008, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000089256908000961/a41434aexv99w8xfy.htm | ||
(1) | First Amendment to Participation Agreement; included in Registrant’s Form N-4, File No. 333-136597, Accession No. 0000950123-10-036152 filed on April 20, 2010, and incorporated by reference herein. |
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This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000095012310036152/a52638exv99w8xfyx1y.htm | |||
(2) | Addendum to Participation Agreement; included in Registrant’s Form N-4, File No. 333-168026, Accession No. 0000950123-11-036762 filed on April 19, 2011, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000095012311036762/a57716bexv99w8xfyx2y.htm | ||
(3) | Second Amendment to Participation Agreement; included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001193125-14-148872 filed on April 18, 2014, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000119312514148872/d655721dex998e3.htm | ||
(4) | Third Amendment to Participation Agreement; included in Registrant’s Form N-4, File No. 333-160772, Accession No. 0001193125-14-310473 filed on August 15, 2014, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000119312514310473/d767546dex998f4.htm | ||
(5) | Fourth Amendment to Participation Agreement; included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001193125-15-134846 filed on April 17, 2015, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000119312515134846/d831839dex998e5.htm | ||
(e) | Form of BlackRock Distributors, Inc. (formerly called FAM Distributors, Inc.) Administrative Services Agreement; included in Registrant’s Form N-4, File No. 333-136597, Accession No. 0000892569-08-000961 filed on July 2, 2008, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000089256908000961/a41434aexv99w8xhy.htm | ||
(1) | First Amendment to Administrative Services Agreement; included in Registration Statement on Form N-4, File No. 333-236927, Accession No. 0001104659-20-029802, filed on March 6, 2020, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000110465920029802/a20-11372_1ex99d8e1.htm | ||
(2) | Second Amendment to Administrative Services Agreement; included in Registrant’s Form N-4, File No. 333-160772, Accession No. 0001193125-14-310473 filed on August 15, 2014, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000119312514310473/d767546dex998h2.htm | ||
(3) | Third Amendment to Administrative Services Agreement; included in Registrant’s Form N-4, File No. 333-160772, Accession No. 0001193125-14-310473 filed on August 15, 2014, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000119312514310473/d767546dex998h3.htm | ||
(4) | Fourth Amendment to Administrative Services Agreement; included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001193125-15-134846 filed on April 17, 2015, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000119312515134846/d831839dex998g4.htm | ||
(f) | Form of Franklin Templeton Services, LLC Administrative Services Agreement; included in Registrant’s Form N-4, File No. 333-136597, Accession No. 0000892569-08-000961 filed on July 2, 2008, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000089256908000961/a41434aexv99w8xiy.htm | ||
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(1) | First Amendment to Administrative Services Agreement; included in Registrant’s Form N-4, File No. 333-136597, Accession No. 0000950123-10-036152 filed on April 20, 2010, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000095012310036152/a52638exv99w8xiyx1y.htm | ||
(2) | Second Amendment to Administrative Service Agreement; included in Registrant’s Form N-4, File No. 333-136597, Accession No. 0001193125-12-502964 filed on December 14, 2012, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000119312512502964/d438041dex998h2.htm | ||
(3) | Third Amendment to Administrative Services Agreement; included in Registrant’s Form N-4, File No. 333-136597, Accession No. 0001193125-12-502964 filed on December 14, 2012, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000119312512502964/d438041dex998h3.htm | ||
(4) | Fourth Amendment to Administrative Services Agreement; included in Registrant’s Form N-4, File No. 333-160772, Accession No. 0001193125-14-310473 filed on August 15, 2014, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000119312514310473/d767546dex998i4.htm | ||
(5) | Fifth Amendment to Administrative Services Agreement; included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001193125-15-134846 filed on April 17, 2015, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000119312515134846/d831839dex998h5.htm | ||
(g) | Form of AIM Variable Insurance Funds Participation Agreement; included in Registrant’s Form N-4, File No. 333-136597, Accession No. 0000892569-08-001559 filed on December 4, 2008, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000089256908001557/a50116exv99w8xny.htm | ||
(1) | First Amendment to Participation Agreement; included in Registrant’s Form N-4, File No. 333-168026, Accession No. 0000950123-12-006432 filed on April 24, 2012, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000095012312006432/a59729bexv99w8xiyx1y.htm | ||
(h) | Form of Invesco Aim Distributors, Inc. Distribution Services Agreement; included in Registrant’s Form N-4, File No. 333-136597, Accession No. 0000892569-08-001559 filed on December 4, 2008, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000089256908001559/a50106exv99w8xky.htm | ||
(1) | First Amendment to Distribution Services Agreement; Included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001104659-17-024827 filed on April 20, 2017, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000110465917024827/a16-17092_1ex99d8dj1.htm | ||
(i) | Form of Invesco Aim Advisors, Inc. Administrative Services Agreement; included in Registrant’s Form N-4, File No. 333-136597, Accession No. 0000892569-08-001559 filed on December 4, 2008, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000089256908001559/a50106exv99w8xly.htm | ||
(j) | Form of PIMCO Variable Insurance Trust Participation Agreement; included in Registrant’s Form N-4, File No. 333-136597, Accession No. 0000950123-10-036152 filed on April 20, 2010, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000095012310036152/a52638exv99w8xsy.htm |
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(1) | First Amendment to Participation Agreement (Novation and Amendment); included in Registrant’s Form N-4, File No. 333-168026, Accession No. 0000950123-11-036762 filed on April 19, 2011, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000095012311036762/a57716bexv99w8xsyx1y.htm | ||
(2) | Second Amendment to Participation Agreement; included in Registrant’s Form N-4, File No. 333-168026, Accession No. 0000950123-11-036762 filed on April 19, 2011, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000095012311036762/a57716bexv99w8xsyx2y.htm | ||
(k) | Form of Allianz Global Investors Distributors LLC Selling Agreement; included in Registrant’s Form N-4, File No. 333-136597, Accession No. 0000950123-10-036152 filed on April 20, 2010, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000095012310036152/a52638exv99w8xty.htm | ||
(1) | First Amendment to Selling Agreement; Included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001104659-17-024827 filed on April 20, 2017, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000110465917024827/a16-17092_1ex99d8ds1.htm | ||
(l) | Form of PIMCO LLC Services Agreement; included in Registrant’s Form N-4, File No. 333-136597, Accession No. 0000950123-10-036152 filed on April 20, 2010, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000095012310036152/a52638exv99w8xuy.htm | ||
(1) | First Amendment to Services Agreement; included in Registrant’s Form N-4, File No. 333-136597, Accession No. 0001193125-12-502964 filed on December 14, 2012, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000119312512502964/d438041dex998t1.htm | ||
(2) | Second Amendment to Services Agreement; included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001193125-14-148872 filed on April 18, 2014, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000119312514148872/d655721dex998t2.htm | ||
(3) | Third Amendment to Services Agreement; included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001104659-18-025540 filed on April 20, 2018, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000110465918025540/a18-7962_1ex99d8dt3.htm | ||
(m) | Form of MFS Variable Insurance Trust Participation Agreement; included in Registrant’s Form N-4, File No. 333-160772, Accession No. 0000950123-10-036181 filed on April 20, 2010, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000095012310036181/a54718exv99w8xvy.htm | ||
(1) | First Amendment to Participation Agreement; included in Registrant’s Form N-4, File No. 333-160772, Accession No. 0000950123-10-036181 filed on April 20, 2010, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000095012310036181/a54718exv99w8xvyx1y.htm | ||
(2) | Second Amendment to Participation Agreement; included in Registrant’s Form N-4, File No. 333-168026, Accession No. 0000950123-11-036762 filed on April 19, 2011, and incorporated by reference herein. This exhibit can be found at |
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http://www.sec.gov/Archives/edgar/data/935823/000095012311036762/a57716bexv99w8xvyx2y.htm | |||
(3) | Third Amendment to Participation Agreement; included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001193125-15-134846 filed on April 17, 2015, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000119312515134846/d831839dex998u3.htm | ||
(n) | (1) | Form of MFS Variable Insurance Trust Administrative Services Agreement; included in Registrant’s Form N-4, File No. 333-160772, Accession No. 0000950123-10-036181 filed on April 20, 2010, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000095012310036181/a54718exv99w8xwy.htm | |
(2) | Form of MFS Variable Insurance Trust Administrative Services Agreement; included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001193125-15-134846 filed on April 17, 2015, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000119312515134846/d831839dex998v2.htm | ||
(3) | MFS Variable Insurance Trust Administrative Services Agreement; Included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001104659-17-024827 filed on April 20, 2017, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000110465917024827/a16-17092_1ex99d8dv3.htm | ||
(o) | Participation Agreement with Fidelity Variable Insurance Products (Variable Insurance Products Funds, Variable Insurance Products Fund II, Variable Insurance Products Fund III and Variable Insurance Products Funds V).; included in Registrant’s Form N-4, File No. 333-168026, Accession No. 0000950123-12-006432 filed on April 24, 2012, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000095012312006432/a59729bexv99w8xwy.htm | ||
(1) | First Amendment to Participation Agreement; included in Registrant’s Form N-4, File No. 333-168026, Accession No. 0000950123-12-006432 filed on April 24, 2012, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000095012312006432/a59729bexv99w8xwyx1y.htm | ||
(2) | Second Amendment to Participation Agreement; included in Registrant’s Form N-4, File No. 333-168026, Accession No. 0000950123-12-006432 filed on April 24, 2012, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000095012312006432/a59729bexv99w8xwyx2y.htm | ||
(p) | Service Contract with Fidelity Distributors Corporation; included in Registrant’s Form N-4, File No. 333-168026, Accession No. 0000950123-12-006432 filed on April 24, 2012, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000095012312006432/a59729bexv99w8xxy.htm | ||
(1) | Amendment to Service Contract; included in Registrant’s Form N-4, File No. 333-168026, Accession No. 0000950123-12-006432 filed on April 24, 2012, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000095012312006432/a59729bexv99w8xxyx1y.htm | ||
(q) | Participation Agreement with First Trust Variable Insurance Trust; included in Registrant’s Form N-4, File No. 333-168026, Accession No. 0000950123-12-006432 filed on April 24, 2012, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000095012312006432/a59729bexv99w8xyy.htm | ||
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(1) | First Amendment to Participation Agreement; included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001193125-14-148872 filed on April 18, 2014, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000119312514148872/d655721dex998y1.htm | ||
(2) | Second Amendment to Participation Agreement; Included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001193125-15-346556 filed on October 19, 2015 and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000119312515346556/d96269dex998y2.htm | ||
(r) | Administrative Services Agreement with First Trust Variable Insurance Trust; included in Registrant’s Form N-4, File No. 333-168026, Accession No. 0000950123-12-006432 filed on April 24, 2012, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000095012312006432/a59729bexv99w8xzy.htm | ||
(1) | First Amendment to Administrative Services Agreement; included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001193125-14-148872 filed on April 18, 2014, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000119312514148872/d655721dex998z1.htm | ||
(2) | Second Amendment to Administrative Services Agreement; included in Registrant’s Form N-4, File No. 333-160772, Accession No. 0001193125-14-310473 filed on August 15, 2014, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000119312514310473/d767546dex998dd2.htm | ||
(3) | Third Amendment to Administrative Services Agreement; Included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001193125-15-346556 filed on October 19, 2015 and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000119312515346556/d96269dex998z3.htm | ||
(s) | Support Agreement with First Trust Advisors L.P.; included in Registrant’s Form N-4, File No. 333-168026, Accession No. 0000950123-12-006432 filed on April 24, 2012, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000095012312006432/a59729bexv99w8xaay.htm | ||
(1) | First Amendment to Support Agreement; included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001193125-14-148872 filed on April 18, 2014, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000119312514148872/d655721dex998aa1.htm | ||
(2) | Second Amendment to Support Agreement; Included in Registrant’s Form N-4, File No. 333184973, Accession No. 0001193125-15-346556 filed on October 19, 2015 and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000119312515346556/d96269dex998aa2.htm | ||
(t) | Participation Agreement with Janus Aspen Series; Included in Registrant’s Form N-6, File No. 333-118913, Accession Number 000892569-07-000444 filed on April 16, 2007, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/832908/000089256907000444/a23397a1exv99wx8yxky.htm | ||
(1) | First Amendment to Participation Agreement; Included in Registrant’s Form N-4, File No. 333-136597, Accession No. 0001193125-12-502964 filed on December 14, 2012, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000119312512502964/d438041dex998dd1.htm |
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(2) | Second Amendment to Participation Agreement; included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001193125-15-134846 filed on April 17, 2015, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000119312515134846/d831839dex998dd2.htm | ||
(u) | Distribution and Shareholder Service Agreement with Janus Distributors LLC; Included in Registrant’s Form N-6, File No. 333-118913, Accession Number 000892569-07-000444 filed on April 16, 2007, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/832908/000089256907000444/a23397a1exv99wx8yxly.htm | ||
(1) | First Amendment to Distribution and Shareholder Service Agreement; Included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001104659-17-024827 filed on April 20, 2017, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000110465917024827/a16-17092_1ex99d8dee1.htm | ||
(v) | Administrative Services Agreement with Janus Capital Management LLC; Included in Registrant’s Form N-6, File No. 333-118913, Accession Number 000892569-07-000444 filed on April 16, 2007, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/832908/000089256907000444/a23397a1exv99wx8yxmy.htm | ||
(x) | Fund Participation and Service Agreement with American Funds; included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001193125-13-399380 filed on October 15, 2013, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000119312513399380/d609046dex998mm.htm | ||
(1) | First Amendment to Fund Participation and Service Agreement; included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001193125-14-148872 filed on April 18, 2014, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000119312514148872/d655721dex998mm1.htm | ||
(2) | Second Amendment to Fund Participation and Service Agreement; included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001193125-15-134846 filed on April 17, 2015, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000119312515134846/d831839dex998mm2.htm | ||
(3) | Third Amendment to Fund Participation and Service Agreement; Included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001193125-15-346556 filed on October 19, 2015 and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000119312515346556/d96269dex998mm3.htm | ||
(y) | Business Agreement with American Funds; included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001193125-13-399380 filed on October 15, 2013, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000119312513399380/d609046dex998nn.htm | ||
(z) | Distribution and Marketing Support Agreement (Amended and Restated) with BlackRock Variable Series Fund, Inc.; included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001193125-15-134846 filed on April 17, 2015, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000119312515134846/d831839dex998ss.htm | ||
(aa) | Exhibit B to the Pacific Select Fund Participation Agreement; Included in Registrant’s Form N-4, File No. 333-160772, Accession No. 0001193125-14-310473 filed August 15, 2014, and incorporated by reference herein. This exhibit can be found at |
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http://www.sec.gov/Archives/edgar/data/935823/000119312514310473/d767546dex998qq.htm | ||
(bb) | Distribution Sub-Agreement with BlackRock Variable Series Fund, Inc.; Included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001104659-17-024827 filed on April 20, 2017, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000110465917024827/a16-17092_1ex99d8dccc.htm | |
(cc) | Administrative Services Agreement with Invesco Advisors, Inc.; Included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001104659-17-024827 filed on April 20, 2017, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000110465917024827/a16-17092_1ex99d8dddd.htm | |
(dd) | Financial Support Agreement with Invesco Distributors, Inc.; Included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001104659-17-024827 filed on April 20, 2017, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000110465917024827/a16-17092_1ex99d8deee.htm | |
(ee) | Selling Agreement with PIMCO Variable Insurance Trust; Included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001104659-18-18-075032 filed on December 28, 2018, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000110465918075032/a18-41610_1ex99dggg.htm | |
(ff) | Service Agreement with PIMCO Variable Insurance Trust; Included in Registrant’s Form N-4, File No. 333-184973, Accession No. 0001104659-18-18-075032 filed on December 28, 2018, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000110465918075032/a18-41610_1ex99dhhh.htm |
9. | Opinion and Consent of legal officer of Pacific Life Insurance Company as to the legality of Contracts being registered; included in Registration Statement on Form N-4, File No. 333-236927, Accession No. 0001104659-20-029802, filed on March 6, 2020, and incorporated by reference herein. This exhibit can be found at http://www.sec.gov/Archives/edgar/data/935823/000110465920029802/a20-11372_1ex99d9.htm |
10. | Consent of Independent Registered Public Accounting Firm and Consent of Independent Auditors |
11. | Not applicable |
12. | Not applicable |
13. |
Item 25. Directors and Officers of Pacific Life
Name and Address | Positions and Offices with Pacific Life |
Director, Chairman, President and Chief Executive Officer | |
Adrian S. Griggs | Director, Executive Vice President and Chief Operating Officer |
Darryl D. Button | Director, Executive Vice President and Chief Financial Officer |
Jason Orlandi | Director, Executive Vice President and General Counsel |
Joseph E. Celentano | Executive Vice President |
Joshua D Scott | Senior Vice President and Chief Accounting Officer |
Jane M. Guon | Vice President and Secretary |
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Craig W. Leslie | Vice President and Treasurer |
The address for each of the persons listed above is as follows:
700 Newport Center Drive Newport Beach, California 92660
Item 26. Persons Controlled by or Under Common Control with Pacific Life or Separate Account A.
The following is an explanation of the organization chart of Pacific Life’s subsidiaries:
Pacific Life is a Nebraska Stock Life Insurance Company wholly-owned by Pacific LifeCorp (a Delaware Stock Holding Company), which is, in turn, 100% owned by Pacific Mutual Holding Company (a Nebraska Mutual Insurance Holding Company).
PACIFIC LIFE, SUBSIDIARIES & AFFILIATED ENTERPRISES
LEGAL STRUCTURE
Jurisdiction of Incorporation or Organization | Percentage of Ownership by its Immediate Parent | |||||||
Pacific Mutual Holding Company | Nebraska | |||||||
Pacific LifeCorp | Delaware | 100 | ||||||
Nebraska | 100 | |||||||
Pacific Life & Annuity Company | Arizona | 100 | ||||||
Pacific Life Purchasing LLC | Delaware | 100 | ||||||
Pacific Select Distributors, LLC | Delaware | 100 | ||||||
Pacific Asset Holding LLC | Delaware | 100 | ||||||
Pacific TriGuard Partners LLC | Delaware | 100 | ||||||
Grayhawk Golf Holdings, LLC | Delaware | 95 | ||||||
Grayhawk Golf L.L.C. | Arizona | 100 | ||||||
Las Vegas Golf I, LLC | Delaware | 100 | ||||||
Angel Park Golf, LLC | Nevada | 100 | ||||||
PL/KBS Fund Member, LLC | Delaware | 100 | ||||||
Wildflower Member, LLC | Delaware | 100 | ||||||
Epoch-Wildflower, LLC | Florida | 100 | ||||||
PL Regatta Member, LLC | Delaware | 100 | ||||||
Regatta Apartments Investors, LLC | Delaware | 90 | ||||||
PL Vintage Park Member, LLC | Delaware | 100 | ||||||
Vintage Park Apartments GP, LLC | Delaware | 90 | ||||||
PL Broadstone Avena Member, LLC | Delaware | 100 | ||||||
Broadstone Avena Investors, LLC | Delaware | 90 | ||||||
GW Member LLC | Delaware | 100 | ||||||
GW Apartments LLC | Delaware | 90 | ||||||
PL Sierra Member, LLC | Delaware | 100 | ||||||
Sierra at Fall Creek Apartments Investors, LLC | Delaware | 90 | ||||||
PL TOR Member LLC | Delaware | 100 | ||||||
2803 Riverside Apartment Investors, LLC | Delaware | 90 | ||||||
PL Denver Member, LLC | Delaware | 100 | ||||||
1776 Curtis, LLC | Delaware | 70 | ||||||
PL Timberlake Member, LLC | Delaware | 100 | ||||||
80 South Gibson Road Apartment Investors, LLC | Delaware | 90 | ||||||
PL Van Buren Member, LLC | Delaware | 100 | ||||||
1035 Van Buren Holdings, L.L.C. | Delaware | 43 | ||||||
PL Lakemont Member, LLC | Delaware | 100 |
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Overlook at Lakemont Venture LLC | Delaware | 88 | |||||
PL Teravista Member, LLC | Delaware | 100 | |||||
401 Teravista Apartment Investors, LLC | Delaware | 90 | |||||
700 Main Street LLC | Delaware | 100 | |||||
PL Brier Creek Member, LLC | Delaware | 100 | |||||
Brier Creek Investors JV LLC | Delaware | 90 | |||||
PL One Jefferson Member, LLC | Delaware | 100 | |||||
One Jefferson Venture LLC | Delaware | 90 | |||||
PL Savannah Member, LLC | Delaware | 100 | |||||
Savannah at Park Place Apartments LLC | Delaware | 90 | |||||
PL Redland Member, LLC | Delaware | 100 | |||||
Redland Road Apartment Investors, LLC | Delaware | 90 | |||||
PL Spectrum Member, LLC | Delaware | 100 | |||||
9242 West Russell Road Apartment Investors, LLC | Delaware | 90 | |||||
PL Mortgage Fund, LLC | Delaware | 100 | |||||
PL Andate Member, LLC | Delaware | 100 | |||||
Andante Venture LLC | Delaware | 90 | |||||
PL Beardslee Member, LLC | Delaware | 100 | |||||
Village at Beardslee Investor, LLC | Delaware | 90 | |||||
PL Monterone Member, LLC | Delaware | 100 | |||||
Monterone Apartment Investor, LLC | Delaware | 90 | |||||
PL Reno Member, LLC | Delaware | 100 | |||||
NPLC BV Manager LLC | Delaware | 81 | |||||
PL Wabash Member, LLC | Delaware | 100 | |||||
THC 1333 S. Wabash LLC | Delaware | 90 | |||||
PL Alara Member, LLC | Delaware | 100 | |||||
Greenwood Village Apartment Investors, LLC | Delaware | 90 | |||||
PL Kierland Member, LLC | Delaware | 100 | |||||
T&L Apartment Investor, LLC | Delaware | 90 | |||||
PL Wardman Member, LLC | Delaware | 100 | |||||
Wardman Hotel Owner, L.L.C. | Delaware | 100 | |||||
PL Peoria Member, LLC | Delaware | 100 | |||||
205 Peoria Street Owner, LLC | Delaware | 90 | |||||
PL Elk Meadows Member, LLC | Delaware | 100 | |||||
Elk Meadows JV LLC | Delaware | 60 | |||||
PL Stonebriar Member, LLC | Delaware | 100 | |||||
Stonebriar Apartment Investor, LLC | Delaware | 90 | |||||
PL Deer Run Member, LLC | Delaware | 100 | |||||
Deer Run JV LLC | Delaware | 60 | |||||
PL Tessera Member, LLC | Delaware | 100 | |||||
Tessera Venture LLC | Delaware | 90 | |||||
PL Vantage Member, LLC | Delaware | 100 | |||||
Vantage Post Oak Apartments, LLC | Delaware | 90 | |||||
PL Fairfax Gateway Member, LLC | Delaware | 100 | |||||
Fairfield Fairfax Gateway LLC | Delaware | 90 | |||||
PL 922 Washington Owner, LLC | Delaware | 100 | |||||
PL Hana Place Member, LLC | Delaware | 100 | |||||
Hana Place JV LLC | Delaware | 60 | |||||
PL LasCo Owner, LLC | Delaware | 100 | |||||
PL Wilshire Member, LLC | Delaware | 100 | |||||
Wilshire Apartment Investors, LLC | Delaware | 90 | |||||
PL Cedarwest Member, LLC | Delaware | 100 | |||||
Cedarwest JV LLC | Delaware | 60 |
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PL Tupelo Member, LLC | Delaware | 100 | |||||||
Tupelo Alley Apartment Investors, LLC | Delaware | 90 | |||||||
PL Aster Member, LLC | Delaware | 100 | |||||||
Alston Manor Investors JV LLC | Delaware | 90 | |||||||
PL Anthology Member, LLC | Delaware | 100 | |||||||
Anthology Venture LLC | Delaware | 100 | |||||||
Anthology Owner LLC | Delaware | 100 | |||||||
Anthology CEA Owner LLC | Delaware | 100 | |||||||
PL Trelago Member, LLC | Delaware | 100 | |||||||
Trelago Way Investors JV LLC | Delaware | 100 | |||||||
PL 803 Division Street Member, LLC | Delaware | 100 | |||||||
Nashville Gulch Venture LLC | Delaware | 100 | |||||||
Nashville Gulch Owner LLC | Delaware | 100 | |||||||
PL Little Italy Member, LLC | Delaware | 100 | |||||||
Little Italy Apartments LLC | Delaware | 69.1848 | |||||||
PL Gramax Member, LLC | Delaware | 100 | |||||||
ASI Gramax LLC | Delaware | 90 | |||||||
PL Walnut Creek Member, LLC | Delaware | 100 | |||||||
Del Hombre Walnut Creek Holdings LLC | Delaware | 75 | |||||||
PL Dairies Owner, LLC | Delaware | 100 | |||||||
PL SFR HD Member, LLC | Delaware | 100 | |||||||
Confederation Life Insurance and Annuity Company | Georgia | 100 | |||||||
Pacific Global Asset Management LLC (Formerly known as Pacific Asset Advisors LLC) | Delaware | 100 | |||||||
Cadence Capital Management LLC | Delaware | 100 | |||||||
Cadence Global Equity GP LLC# | Delaware | 100 | |||||||
Pacific Asset Management LLC | Delaware | 100 | |||||||
PAM Bank Loan GP LLC# | Delaware | 100 | |||||||
PAM CLO Opportunities GP LLC# | Delaware | 100 | |||||||
Pacific Global Advisors LLC | Delaware | 100 | |||||||
Pacific Private Fund Advisors LLC | Delaware | 100 | |||||||
Pacific Co-Invest Credit I GP LLC # | Delaware | 100 | |||||||
Pacific Co-Invest Credit II GP LLC # | Delaware | 100 | |||||||
Pacific Co-Invest Opportunities I GP LLC # | Delaware | 100 | |||||||
Pacific Co-Invest Opportunities II GP LLC # | Delaware | 100 | |||||||
Pacific Private Credit II GP LLC # | Delaware | 100 | |||||||
Pacific Private Credit III GP LLC # | Delaware | 100 | |||||||
Pacific Private Credit IV GP LLC # | Delaware | 100 | |||||||
Pacific Private Credit V GP LLC # | Delaware | 100 | |||||||
Pacific Private Equity I GP LLC # | Delaware | 100 | |||||||
Pacific Private Equity Opportunities II GP LLC # | Delaware | 100 | |||||||
Pacific Private Equity Opportunities III GP LLC # | Delaware | 100 | |||||||
Pacific Private Equity Opportunities V GP LLC # | Delaware | 100 | |||||||
Pacific Private Feeder III GP, LLC # | Delaware | 100 | |||||||
Pacific Private Feeder IV GP, LLC # | Delaware | 100 | |||||||
Pacific Private Equity Opportunities IV GP LLC # | Delaware | 100 | |||||||
PPFA Credit Opportunities I GP LLC # | Delaware | 100 | |||||||
Pacific Life Fund Advisors LLC | Delaware | 100 | |||||||
Pacific Life Trade Receivable GP LLC # (Formerly known as PAM Trade Receivable GP LLC) | Delaware | 100 | |||||||
Pacific Alliance Reinsurance Company of Vermont | Vermont | 100 | |||||||
Pacific Baleine Reinsurance Company | Vermont | 100 | |||||||
Pacific Private Equity Incentive Allocation LLC | Delaware | 100 |
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Pacific Life Aviation Holdings LLC | Delaware | 100 | ||||||||
Aviation Capital Group Holdings, Inc. | Delaware | 100 | ||||||||
Pacific Life & Annuity Services, Inc. | Colorado | 100 | ||||||||
Bella Sera Holdings, LLC | Delaware | 100 | ||||||||
Pacific Life Re Holdings LLC | Delaware | 100 | ||||||||
Pacific Life Re Global Limited (Formerly known as Pacific Life Reinsurance (Barbados) Ltd.) | Bermuda | 100 | ||||||||
Pacific Life Re International Limited | Bermuda | 100 | ||||||||
Pacific Life Re (Australia) Pty Limited | Australia | 100 | ||||||||
Pacific Life Holdings Bermuda Limited | Bermuda | 100 | ||||||||
Pacific Life Services Bermuda Limited | Bermuda | 100 | ||||||||
Pacific Life Re Services Singapore Pte. Limited | Singapore | 100 | ||||||||
Pacific Life Re Holdings Limited | England | 100 | ||||||||
Pacific Life Re Limited | England | 100 | ||||||||
Pacific Life Re Services Limited | England | 100 | ||||||||
UnderwriteMe Limited | England | 100 | ||||||||
UnderwriteMe Technology Solutions Limited | England | 100 | ||||||||
UnderwriteMe Australia Pty Limited | Australia | 100 | ||||||||
Pacific Life Services Canada Limited | Canada | 100 |
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# = Abbreviated structure
Item 27. Number of Contractholders
Pacific Choice Income —Approximately | 222 | Qualified | |
76 | Non-Qualified |
Item 28. Indemnification
(a) The Distribution Agreement between Pacific Life Insurance Company, Pacific Life & Annuity Company (collectively referred to as “Pacific Life”) and Pacific Select Distributors, LLC (PSD) provides substantially as follows:
Pacific Life shall indemnify and hold harmless PSD and PSD’s officers, directors, agents, controlling persons, employees, subsidiaries and affiliates for all attorneys’ fees, litigation expenses, costs, losses, claims, judgments, settlements, fines, penalties, damages, and liabilities incurred as the direct or indirect result of: (i) negligent, dishonest, fraudulent, unlawful, or criminal acts, statements, or omissions by Pacific Life or its employees, agents, officers, or directors; (ii) Pacific Life’s breach of this Agreement; (iii) Pacific Life’s failure to comply with any statute, rule, or regulation; (iv) a claim or dispute between Pacific Life and a Broker/Dealer (including its Representatives) and/or a Contract owner. Pacific Life shall not be required to indemnify or hold harmless PSD for expenses, losses, claims, damages, or liabilities that result from PSD’s misfeasance, bad faith, negligence, willful misconduct or wrongful act.
PSD shall indemnify and hold harmless Pacific Life and Pacific Life’s officers, directors, agents, controlling persons, employees, subsidiaries and affiliates for all attorneys’ fees, litigation expenses, costs, losses, claims, judgments, settlements, fines, penalties, damages and liabilities incurred as the direct or indirect result of: (i) PSD’s breach of this Agreement; and/or (ii) PSD’s failure to comply with any statute, rule, or regulation. PSD shall not be required to indemnify or hold harmless Pacific Life for expenses, losses, claims, damages, or liabilities that have resulted from Pacific Life’s willful misfeasance, bad
faith, negligence, willful misconduct or wrongful act.
(b) The Form of Selling Agreement between Pacific Life, Pacific Select Distributors, LLC (PSD) and Various Broker-Dealers and
Agency (Selling Entities) provides substantially as follows:
Pacific Life and PSD agree to indemnify and hold harmless Selling Entities, their officers, directors, agents and employees, against any and all losses, claims, damages, or liabilities to which they may become subject under the Securities Act, the Exchange Act, the Investment Company Act of 1940, or other federal or state statutory law or regulation, at common law or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of a material fact or any omission or alleged omission to state a material fact required to be stated or necessary to make the statements made not misleading in the registration statement for the Contracts or
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for the shares of Pacific Select Fund (the “Fund”) filed pursuant to the Securities Act, or any prospectus included as a part thereof, as from time to time amended and supplemented, or in any advertisement or sales literature provided by Pacific Life and PSD.
Selling Entities agree to, jointly and severally, hold harmless and indemnify Pacific Life and PSD and any of their respective affiliates, employees, officers, agents and directors (collectively, “Indemnified Persons”) against any and all claims, liabilities and expenses (including, without limitation, losses occasioned by any rescission of any Contract pursuant to a “free look” provision or by any return of initial purchase payment in connection with an incomplete application), including, without limitation, reasonable attorneys’ fees and expenses and any loss attributable to the investment experience under a Contract, that any Indemnified Person may incur from liabilities resulting or arising out of or based upon (a) any untrue or alleged untrue statement other than statements contained in the registration statement or prospectus relating to any Contract, (b) (i) any inaccurate or misleading, or allegedly inaccurate or misleading sales material used in connection with any marketing or solicitation relating to any Contract, other than sales material provided preprinted by Pacific Life or PSD, and (ii) any use of any sales material that either has not been specifically approved in writing by Pacific Life or PSD or that, although previously approved in writing by Pacific Life or PSD, has been disapproved, in writing by either of them, for further use, or (c) any act or omission of a Subagent, director, officer or employee of Selling Entities, including, without limitation, any failure of Selling Entities or any Subagent to be registered as required as a broker/dealer under the 1934 Act, or licensed in accordance with the rules of any applicable SRO or insurance regulator.
(c) Insofar as indemnification for liabilities arising under the Securities Act of 1933 (“Act”) may be permitted to directors, officers or persons controlling Pacific Life pursuant to the foregoing provisions, Pacific Life has been informed that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.
Item 29. Principal Underwriters
(a) | PSD also acts as principal underwriter for Pacific Life Insurance Company, on its own behalf and on behalf of its Separate Account I, Separate Account A, Separate Account B, Pacific Select Variable Annuity Separate Account, Pacific Corinthian Variable Separate Account, Pacific Select Exec Separate Account, Pacific COLI Separate Account, Pacific COLI Separate Account II, Pacific COLI Separate Account III, Pacific COLI Separate Account IV, Pacific COLI Separate Account V, Pacific COLI Separate Account VI, Pacific COLI Separate Account X, Pacific COLI Separate Account XI, Pacific Select Separate Account, and Pacific Life & Annuity Company, on its own behalf and on behalf of its Separate Account A, Pacific Select Exec Separate Account, and Separate Account I. |
(b) | For information regarding PSD, reference is made to Form B-D, SEC File No. 8-15264, which is herein incorporated by reference. |
(c) | PSD retains no compensation or net discounts or commissions from the Registrant. |
Item 30. Location of Accounts and Records
The accounts, books and other documents required to be maintained by Registrant pursuant to Section 31(a) of the Investment Company Act of 1940 and the rules under that section will be maintained by Pacific Life at 700 Newport Center Drive, Newport Beach, California 92660.
Item 31. Management Services
Not applicable
Item 32. Undertakings
The registrant hereby undertakes:
(a) to file a post-effective amendment to this registration statement as frequently as is necessary to ensure that the audited financial statements in this registration statement are never more than 16 months old for so long as payments under the variable annuity contracts may be accepted, unless otherwise permitted.
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(b) to include either (1) as a part of any application to purchase a contract offered by the prospectus, a space that an applicant can check to request a Statement of Additional Information, or (2) a post card or similar written communication affixed to or included in the prospectus that the applicant can remove to send for a Statement of Additional Information, or (3) to deliver a Statement of Additional Information with the Prospectus.
(c) to deliver any Statement of Additional Information and any financial statements required to be made available under this Form promptly upon written or oral request.
Additional Representations
(a) The Registrant and its Depositor are relying upon American Council of Life Insurance, SEC No-Action Letter, SEC Ref. No. 1P-6-88 (November 28, 1988) with respect to annuity contracts offered as funding vehicles for retirement plans meeting the requirements of Section 403(b) of the Internal Revenue Code, and the provisions of paragraphs (1)-(4) of this letter have been complied with.
(b) The Registrant and its Depositor are relying upon Rule 6c-7 of the Investment Company Act of 1940 with respect to annuity contracts offered as funding vehicles to participants in the Texas Optional Retirement Program, and the provisions of Paragraphs (a)- (d) of the Rule have been complied with.
(c) REPRESENTATION PURSUANT TO SECTION 26(f) OF THE INVESTMENT COMPANY ACT OF 1940: Pacific Life Insurance Company and Registrant represent that the fees and charges to be deducted under the Variable Annuity Contract (“Contract”) described in the prospectus contained in this registration statement are, in the aggregate, reasonable in relation to the services rendered, the expenses expected to be incurred, and the risks assumed in connection with the Contract.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the Investment Company Act of 1940, the Registrant certifies that it meets the requirements of Securities Act Rule 485(b) for effectiveness of this Registration Statement and has caused this Post-Effective Amendment No. 1 to the Registration Statement on Form N-4 to be signed on its behalf by the undersigned thereunto duly authorized in the City of Newport Beach, and the State of California on this 23rd day of April, 2021.
SEPARATE ACCOUNT A | ||
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By: | PACIFIC LIFE INSURANCE COMPANY | |
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Director, Chairman, Chief Executive Officer and President | ||
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By: | ||
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By: | ||
Director, Chairman, Chief Executive Officer and President |
Pursuant to the requirements of the Securities Act of 1933, this Post-Effective Amendment No. 1 to the Registration Statement has been signed below by the following persons in the capacities and on the dates indicated:
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Director, Chairman, Chief Executive Officer and President | |||||
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Director, Executive Vice President and Chief Operating Officer | |||||
Adrian S. Griggs* | |||||
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Director, Executive Vice President and Chief Financial Officer | |||||
Darryl D. Button* | |||||
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Director, Executive Vice President and General Counsel | |||||
Jason Orlandi* | |||||
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Vice President and Secretary | |||||
Jane M. Guon* | |||||
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Senior Vice President and Chief Accounting Officer | |||||
Joshua D Scott* | |||||
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Executive Vice President | |||||
Joseph E. Celentano* | |||||
| Vice President and Treasurer | ||||
Craig W. Leslie* | |||||
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*By: | /s/ BRANDON J. CAGE | ||||
as attorney-in-fact |
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(Powers of Attorney are contained in this Registration Statement as Exhibit 13). |