Des Moines, IA – March 23, 2021
Midland National Life Insurance Company (Midland National) introduced the first index aligned with the growing environmental, social, and governance – or ESG – marketplace. The new BlackRock ESG US 5% Index ER (ticker: BESGUVCX) will be available across three Midland National products and represents the first time an index of this type will be available with fixed index annuity (FIA) products in the independent insurance agent channel.
“Agents and their clients are looking for socially responsible investment options, and the BlackRock ESG US 5% Index ER is not only an industry first, but Midland National is applying it across two popular, and one new, fixed index annuities,” said Rob TeKolste, president, Sammons Independent Annuity Group. “We are making the index available across a range of FIAs to allow clients broad access, no matter how they choose to manage their annuity.”
This new index will help consumers take advantage of growing interest in financial products that employ socially responsible crediting strategies. Midland National made the ESG index available on its MNL IncomeVantage® Pro and MNL RetireVantage® (March 9) fixed index annuities, and the new MNL AccelerateSM 5 fixed index annuity (March 30). Exclusively available through Midland National, MNL Accelerate 5 is a short-term FIA offering five-year guaranteed participation rates. It was created based on agent feedback.
“Annuity design mandates that we meet both client expectations and take advantage of innovation in product development. We see new opportunities emerging in the ESG marketplace,” said Jill Esser, vice president, annuity product development. “With this new ESG index, we expect our three product options will be attractive to clients that want to align with companies facing global societal issues. I expect agents and clients will seek out this option for both its performance and social focus.”
BlackRock Index Services developed the index as part of its commitment to increase access to sustainable investing by expanding and improving the universe of sustainable indexes that can be used in FIA products. The index targets companies that have risk management tools in place and are focused on reducing environmental risks. Examples of securities supporting this goal include companies seeking to support a diverse workforce, lower carbon emissions, and strengthen data privacy.
The MNL Accelerate 5 FIA offers a selection of crediting strategies using an easy-to-apply participation rate that is guaranteed for its five-year term. Regardless of index performance, the guaranteed participation rate offers stability as it will not go down over the five-year surrender charge period. For the independent agent, this FIA offers the choice of three increasingly popular options in the “low volatility” index category. The three indexes include BlackRock ESG US 5% Index ER, Fidelity Multifactor Yield IndexSM 5% ER, and the S&P 500® Low Volatility Daily Risk Control 5% Index ER.
In a low interest rate environment, agents and their clients want the security fixed index annuities can offer. Industry research also finds that younger consumers – seeking to manage their money while growing assets for retirement – are drawn to products that can benefit society.
“This new ESG index was created to help connect clients to financial planning and retirement tools that acknowledge the growing concern of climate change and social issues,” Esser said.
“We think the trend toward greater company disclosure and clearer understanding of how ESG risks affect investment returns will spur increased adoption of sustainable products," said Anne Ackerley, Managing Director and Head of BlackRock’s Retirement Group. “The BlackRock ESG US 5% Index ER exemplifies our commitment to increase access to sustainability solutions through index innovation.”
Midland National understands this trend and seeks to help a new generation of clients find sustainability-focused product options. The BlackRock ESG US 5% Index ER has a focus on sustainable investing, however the premiums paid are not directly invested in the available indexes and their underlying elements. Midland National invests the premium it receives into its general account to support crediting strategies, which may not fully align to ESG principles.
About Midland National Life Insurance Company
For more than 115 years, Midland National® Life Insurance Company (Midland National) has been an industry leader, crediting the company’s strength to its commitment to stability, innovation, and dedicated customer service. Midland National is accredited by the Better Business Bureau, and has earned an A+ (Superior) rating from A.M. Best, a large third-party independent reporting and rating company that rates an insurance company on the basis of the company's financial strength, operating performance, and ability to meet its ongoing obligations to policyowners. This rating is the second highest out of 15 categories and was affirmed by A.M. Best for Midland National as part Sammons® Financial Group, Inc. on Aug. 19, 2020.
Founded as Dakota Mutual Life Insurance Company in 1906, Midland National has protected families and preserved legacies for generations. Midland National is one of the leading insurance companies in the United States. Midland National is a member of Sammons Financial Group, a subsidiary of Sammons Enterprises, Inc. With its annuity division in West Des Moines, Iowa, and its life insurance operations in Sioux Falls, South Dakota, Midland National operates in 49 states and the District of Columbia through its 12,000 licensed sales professionals. For more information, click here.
Fixed index annuities are not a direct investment in the stock market. They are long term insurance products with guarantees backed by the issuing company. They provide the potential for interest to be credited based in part on the performance of specific indices, without the risk of loss of premium due to market downturns or fluctuation. Although fixed index annuities guarantee no loss of premium due to market downturns, deductions from your accumulation value for additional optional benefit riders or strategy fees associated with allocations to enhanced crediting methods could exceed interest credited to the accumulation value, which would result in loss of premium. They may not be appropriate for all clients. Interest credits to a fixed index annuity will not mirror the actual performance of the relevant index.
Withdrawals taken prior to age 59½ may be subject to IRS penalties.
The BlackRock ESG US 5% Index ER is a product of BlackRock Index Services, LLC and has been licensed for use by Midland National® Life Insurance Company. BlackRock®, BlackRock ESG US 5% Index ER, and the corresponding logos are registered and unregistered trademarks of BlackRock. The annuity product is not sponsored, endorsed, sold or promoted by BlackRock Index Services, LLC, BlackRock, Inc., or any of its affiliates, or any of their respective third-party licensors (including the Index calculation agent, as applicable) (collectively, “BlackRock”). BlackRock has no obligation or liability in connection with the administration or marketing of the annuity product. BlackRock makes no representation or warranty, express or implied, to the owners of the annuity product or any member of the public regarding the advisability of investing the annuity product or the ability of the BlackRock ESG US 5% Index ER to track general market performance. BlackRock does not guarantee the adequacy, accuracy, timeliness, and/or completeness of the Index or any data or communication related thereto nor does it have any liability for any errors, omissions or interruptions of the BlackRock ESG US 5% Index ER.
The BlackRock ESG US 5% Index ER (the “Index”) objective is to offer exposure to the iShares ESG Aware MSCI USA ETF subject to a 5% Target Volatility. The index manages to the Target Volatility by incorporating Fixed Income US Treasury iShares® ETFs and a Cash Constituent.
The Index tracks the return of the weighted ETFs and any Cash Constituent, above the sum of the Return on the Interest Rate and the Index Fee. It is important to note your premium is not invested in the Index but in the insurance company’s general account, which may include investments that do not follow the environmental, social, and governance (ESG) practices of the BlackRock ESG US 5% Index ER.
MNL IncomeVantage® Pro is a fixed index annuity issued on base contract form AS201A/ICC19-AS201A or appropriate state variation including all applicable endorsements and riders.
MNL RetireVantage® is a fixed index annuity issued on base contract form AS124A/AS145A/ICC16-AS145A.MVA or appropriate state variation including all applicable endorsements and riders.
MNL AccelerateSM 5 is issued on form AS201A/AS202A/ICC19-AS201A (contract), AR383A/ICC20-AR383A, AR362A/ICC19-AR362A, AR360A/ICC19-AR360A, AR151A04 (riders/endorsements) or appropriate state variation by Midland National® Life Insurance Company, West Des Moines, IA. This product, its features and riders may not be available in all states.