What It Costs
How Much is a Variable Annuity?
Generally, there are three types of fees for a variable annuity: an insurance expense, investment option expenses and a surrender charge. Some companies may also charge other asset based fees, additional charges for additional benefits, and additional administrative fees. Keep in mind, the lower the costs in an annuity, the more is invested and working for your client.
Use our Annuity Cost Comparison Calculator on the right side to see the difference that low fees can make.
- Insurance Expenses
The mortality and expense (M&E) and administrative fee pays for expenses relating to the development and sale of the product including overhead, customer support, sales and marketing, and administration.
The weighted industry average M&E and administrative fee is 1.37% of the value of the annuity plus an annual fee of $34.* The Ameritas No-Load Variable Annuity costs about 50% less—currently .60% (guaranteed not to exceed .80%) and an annual policy fee of $40 (guaranteed not to increase) which is waived for accounts with policy values of $50,000 or more.. - Investment Options Fees
These fees are used to pay the investment option advisor or subadvisor for management advice as well as for actual trading expenses and other costs of running the investment option. - Surrender Charges
Many variable annuities carry surrender charges, which means that if your client changes their mind and want to cancel the contract early, they forfeit a percentage of the money to the insurance company. The Ameritas No-Load Variable Annuity has no surrender charges.
For more information about expenses, call the Ameritas Advisor Services professionals.
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*According to the Morningstar Annuity Research Center 2010 Industry Expense Report, copyright 2011.
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