An annuity is essentially an insurance contract promising a steady income stream during retirement — often extending for life — in return for a lump sum or a series of contributions. Crafted for those seeking dependable, long-range financial stability, annuities shine brightest in one’s golden years.
With a surge in demand for these products, Allianz is intensifying its focus on annuities, presenting an array that highlights fixed index and registered index-linked varieties. This insurance titan leverages its solid reputation for reliability, tailoring solutions for investors keen on cushioning themselves against market swings while still chasing some upside growth.
Here, we unravel Allianz’s premier annuity selections, dissect their standout features, fees, and all essential insights you should grasp before ink hits paper.
What’s on Allianz’s Annuity Menu?
Allianz zeroes in on two predominant annuity types: fixed index annuities (FIAs) and registered index-linked annuities (RILAs). There’s no place here for plain vanilla fixed annuities or income-only contracts — it’s either dipping into market exposure or skipping Allianz entirely.
On the surface, index-linked annuities seem straightforward; however, peeling back the layers exposes a labyrinth of crediting mechanisms, hidden fees cloaked in fine print, and rider options that can bewilder even seasoned buyers. Allianz often brands their annuities as “innovative,” yet in practice, this can feel like navigating a maze designed to baffle.
Indeed, index-linked annuities are notoriously intricate, but Allianz seems to raise the complexity bar even higher. Benefits don’t always outshine competitors, and without wading through dense disclosures, figuring out actual costs or how returns get computed is near impossible.
Fixed Index Annuities (FIAs)
For those wanting their money to grow without risking principal losses in market downturns, fixed index annuities offer a balanced path. Tethered to a stock market index such as the S&P 500, FIAs serve as a middle ground between security and growth potential.
Allianz Accumulation Advantage Annuity
- Minimum initial premium: $20,000
- No annual contract or rider charges
- Guaranteed principal preservation
- Choice among four crediting methods
- Flexible allocations including various indexes plus a fixed rate
- “Index Lock” feature to secure index gains mid-crediting period
- Starting guaranteed minimum interest rate at 9.30% in year one, tapering to 1% by year ten
- Allows 10% penalty-free annual withdrawals
- No free withdrawals allowed for terminal illness or nursing home stays
Allianz 360 Annuity
- Principal shielded from market setbacks
- Three crediting options: monthly sum, annual point-to-point, monthly average
- Mandatory 360 Benefit rider for first five years (0.95% annual fee initially; can rise up to 3%) grants an interest bonus
- Caps and participation rates affect interest credits
- Deferred income leads to gradually increasing lifetime withdrawal percentages after age 40
- Complimentary standard death benefit included
- 10-year surrender window with fees starting at 10% (year one) diminishing to 1.25% by year ten
- Annual free withdrawal of 10%
Allianz Benefit Control Annuity
- $20,000 entry minimum
- No explicit contract fees, though “allocation fees” can reach up to 2.5% depending on crediting method
- Principal safeguarded
- Generous 25% bonus on additional premiums within first 18 months
- Complex bonus framework
- Early payout access starting at age 50—ideal for early retirees
- 10-year surrender charges reducing from 9.30% in year one down to 1.05% by year ten
- Penalty-free withdrawals up to 20% for qualifying health issues after five years
Registered Index-Linked Annuities (RILAs)
These annuities push the envelope by embracing more market risk for the chance at beefier returns. While downside protection exists, the principal isn’t fully shielded—you risk losses depending on market dips and your chosen buffer or floor. RILAs suit investors chasing stock market-like gains but who still want some protective guardrails.
Allianz’s RILAs are highly customizable: protection levels, index strategies, and investment duration are all yours to tweak. Offering more pliability than traditional fixed annuities, they come with added complexity. You’ll need to wrap your head around caps, buffers, and participation rates before committing.
Allianz Index Advantage+ Variable Annuity
- Minimum investment: $10,000
- Product fee: 1.25% annually
- $50 annual service fee for accounts below $100,000
- Investment fund fees at 0.65%
- Investment risk persists—principal is not fully protected
- Several index options and crediting approaches
- Loss mitigation via buffers (10%-30%) or a -10% floor
- Complimentary standard death benefit; optional rider for 0.20% fee (benefits accessible only pre-annuitization)
- Surrender charges begin at 8%, tapering off to zero by year six
- Annual 10% free withdrawal allowed
Allianz Index Advantage+ Income Variable Annuity
- $5,000 minimum premium
- 1.25% annual product fee plus 0.70% Income Benefit rider (included by default)
- $50/year fee for accounts below $100,000
- Investment fund fees of 0.65%
- Income percentage rises the longer income deferral extends (from age 45)
- Two payout options: level or increasing income
- Varied crediting methods and index strategies
- Retention of investment risk and strategic complexity
- Loss-limiting features via 10%-30% buffers or a -10% floor
- Basic death benefit included; optional rider available for 0.20%
- Six-year surrender span, fees starting at 8% down to zero by year six
- Free 10% annual withdrawal provision
Fast Facts: Allianz Life Insurance Company of North America, founded in 1896 and part of the German global juggernaut Allianz SE, sits in Minneapolis and manages assets exceeding $160 billion. In 2024, Allianz clinched the second spot nationally for registered index-linked annuity sales, topping $9 billion according to LIMRA. It holds solid ratings such as A+ from AM Best and AA from Standard & Poor’s.
About Allianz: A Legacy of Stability
Allianz Life Insurance Company of North America has carved out a niche focusing on life insurance and retirement products—primarily annuities. A giant in the field, it enjoys a sturdy reputation and consistent financial strength.
Pros and Cons of Choosing Allianz Annuities
Pros
- Diverse fixed index annuity lineup: Whether you lean toward caution or can stomach some risk, Allianz offers fixed index products tailored to assorted appetites.
- Tax-advantaged growth: Earnings accumulate tax-deferred until withdrawals begin, a standard perk across annuities.
- Customizable lifetime income: Riders can be tacked on to secure income for life, albeit for an added fee.
Cons
- Complexity overload: The products are layered with jargon and intricate terms—caps, buffers, spreads—requiring a solid grasp to avoid surprises in returns.
- Additional rider costs: Want extra guarantees? They come at a price, which can chip away at your earnings.
- Lack of straightforward immediate annuities: If you crave simple, no-nonsense products disbursing payments swiftly, Allianz might not hit the mark.
- Long surrender periods: Contracts typically carry surrender charges for up to a decade, longer than the industry average of roughly seven years.
Is Allianz Right for You?
If simplicity and quick cash access top your list, Allianz annuities probably aren’t your cup of tea. But for those targeting long-haul retirement income with a blend of security and growth, and willing to delve into detailed disclosures and commit for the long term, Allianz could be a compelling contender.
Ultimately, choosing the right annuity boils down to your personal risk appetite, age, and financial objectives. There’s no one-size-fits-all solution here, nor are these products bargain basement — thorough understanding is key.
Editorial Disclaimer: Investors are encouraged to perform their own due diligence on investment methods before making decisions. Historical performance does not guarantee future results.