Additional index options and crediting methods available
(See your letter for index strategies available for your contract)
S&P Multi-Asset Risk Control 5% Excess Return Index (S&P MARC 5% ER)/Annual Point-to-Point with Participation Rate
The S&P MARC 5% ER Index is a multi-asset excess return index that strives to create more stable index performance through diversification, an excess return methodology, and volatility management. The index manages volatility by adjusting the allocations among multiple asset classes and by allocating to cash in certain market environments. The index is managed to a 5% volatility level.
S&P 500® Low Volatility Daily Risk Control 5% Index/ Annual Point-to-Point with Index Margin
The S&P 500® Low Volatility Daily Risk Control 5% Index strives to create stable performance through managing volatility (i.e. risk control) on the S&P 500® Low Volatility Index. The S&P 500® Low Volatility Index measures performance of the 100 least volatile stocks in the S&P 500®. The index adds an element of risk control by allocating between stocks, as represented by the S&P 500® Low Volatility Index, and cash. This index is managed to a 5% volatility level.
Crediting methods explained
This calculation method measures the change in index value using two points in time; the beginning index value and the ending index value for that year. Index linked gains are calculated based on the difference between these two values. The index growth, if any, is then subject to an index margin and/or participation rate. The annual interest credit will never be less than zero.
Once a gain has been calculated using the Annual Point-to-Point index account option, a participation rate is applied. The participation rate is a percentage that is multiplied by the gain at the end of the contract year and is used to determine the interest credit to your contract. The participation rate is guaranteed for the first contract year, and can change each year thereafter on the contract anniversary. The participation rate is declared each year at the Company’s discretion. However, at no time will this rate ever fall below the minimum guaranteed participation rate set for the Annual Point-to-Point index account.
Once a gain has been calculated using the Annual Point-to-Point index account option, an index margin is subtracted. The index margin is guaranteed for the first year, but can change each year thereafter at the company’s discretion. The index margin is set in advance each contract year, however at no time will it be greater than the maximum index margin for the Annual Point-to-Point index account.
It is important for you to know there is no such thing as an overall “best” crediting method or index. Midland National’s crediting methods and available indexes perform differently in various market scenarios. There is not one particular method or index that performs better than the other methods and indexes when observed in all market scenarios.
Change your allocation or keep it the same – It’s up to you.
If you are happy with your current allocations, there is no need to take action at your contract anniversary date.
If you choose to change your allocation, contact your financial professional or call to reallocate at 877-586-0244.
To view your current contract allocations please log in to view your contract details. Once logged in, you can find your current allocation options on your annual statement.