Pacific Life Producer Alliance
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Pacific Life Producer Alliance
Pacific Index Choice
Overview

Pacific Index Choice is a deferred, indexed annuity. It provides safety of principal and has the potential to earn interest based on the positive movement of two offered indexes and a fixed account that provides a guaranteed interest rate. With Pacific Index Choice, the purchase payment is not invested in the market and therefore principal will never be lost due to market performance. However, the value of the contract can grow with the immediate credit enhancement, and through interest earned from the Interest-Crediting Options.

Also, even if the selected index or indexes remain flat or have negative returns and the contract value earns no interest, clients are still guaranteed growth in certain situations through the Guaranteed Minimum Surrender Value.

Along with the guarantees and principal protection that Pacific Index Choice provides, it also offers a choice of an optional living benefit or an optional death benefit. Please refer to our Optional Benefits page for more information.

Pacific Index Choice is only available in California.

Features

Choice of Interest-Crediting Options

Clients can allocate among one or a combination of seven Interest-Crediting Options, including a Fixed Account Option, and/or six Index-Linked Options.

Guaranteed Minimum Surrender Value

Upon full withdrawal of the contract value, death, or annuitization, clients are guaranteed growth with the Guaranteed Minimum Surrender Value. The Guaranteed Minimum Surrender Value is equal to purchase payments accumulated at a fixed interest rate, which is set at contract issue, minus prior withdrawals and applicable withdrawal charges. The Guaranteed Minimum Surrender Value is guaranteed for the life of the contract, but excludes the credit enhancement.

Immediate Credit Enhancement

The credit immediately applied to the contract value is a percentage of the purchase payment, and may vary based on 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.

Optional Benefits

Pacific Index Choice offers an optional guaranteed minimum withdrawal benefit that can provide guaranteed lifetime income beginning at age 59½, or an optional death benefit that can help protect and enhance the legacy your clients leave to their loved ones.

Please refer to our Optional Benefits page for more information, including additional cost.

Getting Started

Premium: Limited premium. 1035 exchange/transfer requests must be submitted with the application and the funds received within 60 days after contract issue. Additional cash purchase payments are permitted within the first 60 days after contract issue, up to a maximum of $100,000. All payments are subject to the product maximum.

Minimum Purchase Payment: $25,000 (qualified and nonqualified)

Maximum: $1 million; total purchase payments greater than $1 million require Pacific Life home-office approval in advance. (Pacific Life reserves the right to change the minimum and maximum amounts.)

Maximum Annuitant/Owner Issue Age: 85

Maximum Annuitization Age: 95

Initial Guaranteed Periods

Choice of three initial guaranteed periods:

  • 6 Years
  • 8 Years
  • 10 Years

Only one initial guaranteed period may be selected per contract. Initial interest rates and caps guaranteed for the length of the initial guaranteed period chosen.

All initial guaranteed periods may not be available at all times, in all states, or offered through all firms.

The initial guaranteed period determines:

  • The interest rates that will be earned on the Fixed Account Option and the Declared Index Interest Option, as well as the time period the rates are guaranteed.
  • Any caps applied to the Index-Linked Options and the time period the cap is guaranteed. A cap is the maximum amount of interest that can be earned for the index term.
  • When clients will have full access to the contract value without incurring a withdrawal charge. The initial guaranteed period corresponds to the withdrawal charge schedules.
Interest-Crediting Options

Fixed Account Option

  • Interest credited daily.
  • The initial rate is guaranteed for the length of the initial interest rate guaranteed period.
  • The renewal rate will never be lower than the minimum guaranteed interest rate stated in the contract.

Index-Linked Options

  • Interest may be credited at the end of an index term depending on the amount of change in an index price.
  • The initial interest rates and caps will depend on the withdrawal charge period chosen and the total of all purchase payments received. The index-linked breakpoints are:
    • Less than $100,000
    • $100,000 and more
  • Six Indexed-Linked Options are available:
    • S&P 500® Index
      • 1-Year Point-to-Point Option with cap
      • 2-Year Point-to-Point Option with cap
      • Declared Index Interest Option
    • MSCI All Country World Index (ACWI®)
      • 1-Year Point-to-Point Option with cap
      • 2-Year Point-to-Point Option with cap
      • Declared Index Interest Option

Please note: Additional purchase payments are permitted within the first 60 days of contract issue. Interest will be credited proportionally based on the index return from the time the additional purchase payment is made to the end of the 1-year index term.

Transfers

  • Effective on contract anniversary.
  • Transfer the value from the Fixed Account Option and expired index terms to any available Index-Linked Option or the Fixed Account Option.
  • Can be requested up to 30 days after the contract anniversary.
  • Transfers cannot be made into or out of an active 2-Year Point-to-Point Option.

The Product and its MSCI ACWI® Index-Linked Options referred to herein are not sponsored, endorsed, or promoted by MSCI, and MSCI bears no liability with respect to any such Products or any index on which such Products are based. The Policy Contract contains a more detailed description of the limited relationship MSCI has with Pacific Life Insurance Company and any related products.

The S&P 500® index is a product of S&P Dow Jones Indices LLC ("SPDJI"), and has been licensed for use by Pacific Life Insurance Company. S&P® and S&P 500® are registered trademarks of Standard & Poor’s Financial Services LLC ("S&P"); Dow Jones® is a registered trademark of Dow Jones Trademark Holdings LLC ("Dow Jones"); and these trademarks have been licensed for use by SPDJI and sublicensed for certain purposes by Pacific Life. Pacific Life’s products are not sponsored, endorsed, sold, or promoted by SPDJI, Dow Jones, S&P, their respective affiliates, and none of such parties make any representation regarding the advisability of investing in such product(s), nor do they have any liability for any errors, omissions, or interruptions of the S&P 500 index.

The indexes are not available for direct investment, and index performance does not include the reinvestment of dividends.

Withdrawal Charges and Fees

Clients may select one of three initial guaranteed periods that correspond to the withdrawal charge schedule. Withdrawal charges apply only during the initial guaranteed period when the amounts taken are more than those discussed in the "Withdrawals without Charge" section below.

No annual contract, mortality and expense, or administrative fees.

Optional Benefit Fees

Market Value Adjustments (MVAs)

Withdrawal and contract values annuitized before the end of the initial guaranteed period, in excess of 10% of the prior anniversary’s contract value (10% of purchase payments in the first year), will be subject to an MVA (in addition to any applicable withdrawal charges), so clients should carefully consider their income needs before purchasing a contract.

The MVA is based on a formula designed to respond to interest-rate movements. As a general rule, if interest rates have stayed the same or risen since contract issue, the MVA can reduce the amount withdrawn. If interest rates have fallen, the MVA can increase the amount withdrawn, up to a specified maximum. In no event will the MVA cause the withdrawal amount to be less than the Guaranteed Minimum Surrender Value.

There is no MVA assessed on withdrawals made after the withdrawal charge period has expired. Withdrawals are permitted 30 days after contract issue.

Please note, the MVA does not apply in AK, CA, IA, MN, MO, NH, OK, and WA.

Withdrawals without Charge

In the first contract year, 10% of the total purchase payments minus withdrawals. For each subsequent contract year, 10% of the contract value as of the prior contract anniversary.

In addition, withdrawal charges and the MVA will be waived for:

  • Required minimum distribution (RMD) withdrawals (only 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 90 days of contract issue if confined to an accredited nursing home for 30 days or more, as long as the confinement to a nursing home began after the contract was issued (except in CA and MA).
  • Death benefit proceeds.
  • Annuity income payments. (Available after the first contract year; an MVA may apply.)
  • Withdrawals up to the Lifetime Annual Withdrawal Amount under the optional Enhanced Lifetime Income Benefit.

Note: For Index-Linked Options, no interest is earned or credited on amounts withdrawn prior to the end of an index term.

Guaranteed Minimum Surrender Value

If the selected index or indexes remain flat or have negative returns and the contract value earns no interest, clients are still guaranteed growth with the Guaranteed Minimum Surrender Value.

The Guaranteed Minimum Surrender Value is equal to purchase payments accumulated at a fixed interest rate, which is set at contract issue, minus prior withdrawals and applicable withdrawal charges. The Guaranteed Minimum Surrender Value is guaranteed for the life of the contract, but excludes the credit enhancement.

The Guaranteed Minimum Surrender Value applies at:

  • Full withdrawal (withdrawal charges apply).
  • Death.
  • Annuitization.
Annuitization
  • Receive payments based on the greater of the contract value or the Guaranteed Minimum Surrender Value.
  • Pro rata index-linked interest is credited to the contract value upon annuitization or death.

Options (available one year after contract issue. An MVA may apply.)

Payout Options Available:

  • Life Only
  • Life with Period Certain (5-30 years1)
  • Joint and Survivor Life
  • Period Certain Only (up to 30 years1)

Type
Fixed
Partial annuitization is not available

Frequency
Monthly, quarterly, semiannually, annually

Minimum Annuity Income Payment Amount
$250

1For qualified contracts, the maximum length of time for the Period Certain options may be less than 30 years if necessary, to comply with required minimum distribution (RMD) regulations for annuities.

Standard Death Benefit

For no additional cost, if death occurs before annuity income payments begin, a death benefit equal to the greater of the contract value or the Guaranteed Minimum Surrender Value is paid upon 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). Pro rata index-linked interest is credited to the contract value on the notice date.

 


Pacific Index Choice is not available in New York.

Fixed annuities are long-term contracts designed for retirement. Annuity withdrawals and other distributions of taxable amounts, including death benefit payouts, will be subject to ordinary income tax. For nonqualified contracts, an additional 3.8% federal tax may apply on net investment income. If withdrawals and other distributions are taken prior to age 59½, an additional 10% federal tax may apply. A withdrawal charge and a market value adjustment (MVA) also may apply. Withdrawals will reduce the contract value, the value of the death benefit, and the Guaranteed Minimum Surrender Value and also may reduce the value of any optional benefits.

Pacific Life guarantees, including interest rates and subsequent income payments, are backed by the claims-paying ability of Pacific Life. No guaranteed rate will be less than the minimum guaranteed rate stated in the contract. Pacific Life determines, at its discretion, annual interest rates in excess of the stated minimum guarantee in the contract. All initial guaranteed periods/terms may not be available at all times, in all states, or offered by all firms.

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