Pacific Expedition is a financial solution that offers safety of principal, predictable growth, and an opportunity to earn more interest should rates rise.
With Pacific Expedition, the client is not invested in the market and therefore will never lose your principal because of market performance. However, the value of the contract is guaranteed to grow. The client will receive an immediate increase to their contract value with the credit enhancement and earn a guaranteed interest rate that is set at the time the annuity contract is purchased.
Along with the principal protection that Pacific Expedition’s guarantees provide, there is an opportunity to earn more if rates rise through the optional feature called RateAdvantage. This feature provides a one-time opportunity during the initial guaranteed period to increase the initial guaranteed interest rate if newly declared rates are higher.
Immediate Credit Enhancement
The credit immediately applied to the contract value is a percentage of the purchase payment, and may vary by the initial guaranteed period selected. The credit enhancement is not counted as a purchase payment, will not be returned under the free-look provision, and is treated as earnings for tax purposes when distributed.
Purchase Payment Guarantee
If the entire contract is surrendered, the client is guaranteed to get back at least the total purchase payments minus any prior partial withdrawals and applicable withdrawal charges. If withdrawal charges are paid on partial withdrawals, the purchase payment guarantee will be decreased.
RateAdvantage is an optional feature that provides a one-time opportunity during the initial guaranteed period to increase the initial guaranteed interest rate if newly declared rates are higher.
- RateAdvantage must be elected at contract issue.
- Initial guaranteed interest rates will be lower for contracts with the RateAdvantage feature elected.
- If RateAdvantage is elected, the feature can be exercised if newly declared rates (rates on new contracts for the same guaranteed period with RateAdvantage elected) are higher on a contract anniversary during the initial guaranteed period than the initial guaranteed interest rate set at contract issue.
- The feature can be exercised once during the initial guaranteed period, and it must be within 60 days of a contract anniversary. The new rate will be effective for the remainder of the initial guaranteed period.
- The amount of the rate increase will be subject to a maximum each year, known as the Maximum Anniversary Rate (MAR), which will increase each contract year. MARs are specified in the contract at issue.
- The rate will automatically increase if newly declared rates are higher and the feature has not been exercised by the last contract anniversary prior to the end of the initial guaranteed period.
Premium: Limited premium. All cash purchase payments must be submitted with the application. 1035 exchange/transfer payment requests must be submitted with the application and the funds must be received within 90 days after contract issue.
Minimum Purchase Payment: $25,000 (qualified and nonqualified)
Maximum: $1 million; total purchase payments greater than $1 million, Pacific Life home-office approval in advance. (Pacific Life reserves the right to change the minimum and maximum amount.)
Maximum Annuitant/Owner Issue Age: 88
Maximum Annuitization Age: 95
Choice of one of two initial guaranteed periods*:
- 5 Years
- 7 Years
*All initial guaranteed periods may not be available at all times or in all states.
The interest rate credited on the initial purchase payment is guaranteed for the duration of the period selected. Only one initial guaranteed period may be selected per contract. After the initial guaranteed period expires, and on all subsequent contract anniversaries, a renewal rate will be declared by Pacific Life and is guaranteed for one contract year. The renewal rate will never be lower than the minimum guaranteed interest rate stated in the contract.
The interest rate credited will depend on the total of all purchase payments received (minus withdrawals). The breakpoints are:
- $100,000 and more
Withdrawal Charge Schedule
Withdrawal charges only apply during the initial guaranteed period (based on age of contract).
|Current Contract Year||Charge per Withdrawal|
|Current Contract Year||Charge per Withdrawal|
No annual contract, mortality and expense, or administrative fees.
In the first year, 10% of the total purchase payments are available for withdrawal with no withdrawal charge. In subsequent years, 10% of the previous anniversary’s contract value is available with no withdrawal charge.
In addition, withdrawal charges may be waived for:
- Required minimum distribution (RMD) withdrawals (if calculated by Pacific Life).
- Withdrawals after the first contract year if diagnosed with a terminal illness (life expectancy of 12 months or fewer), except in CA.
- Withdrawals after the first 90 days if confined to an accredited nursing home for 30 days, as long as not confined when the contract is issued, except in CA.
- Death benefit proceeds.
- Annuity income payments (available one year after contract issue).
After the first year, the option to convert the contract to annuity income payments via one of four standard payout options is available. Once the contract is converted to an annuity income stream, the payout options cannot be changed. Amounts will differ, based on the payout period selected. Usually, the longer the payout option, the lower the periodic payment amount.
- Life Only
- Life with Period Certain (5–30 years)
- Joint and Survivor Life
- Period Certain Only (up to 30 years)
If death occurs before annuity income payments begin, death benefit equal to the contract value is paid at the death of the first owner or the last annuitant. If the death benefit is payable in the first year, the credit enhancement will be recaptured on a proportional basis (except in CT and NY).
Maximum Anniversary Rate is named "Maximum Adjusted Guaranteed Rate" in the contract rider.