| | | While we announce minimum guaranteed rates 30 days in advance of every calendar quarter, the low interest rate environment has caused us to reevaluate minimum guarantees for our annuity products for the 4th quarter. The changes to Eleos and Apollo guarantees may appear significant, but please consider our published renewal rate histories and competitive current rates. Also understand that in the current economic environment, higher guarantees would require further reductions to current rates. The Minimum Guaranteed Interest Rate for all new Apollo and Eleos contracts for the 4th quarter of 2010 are shown on the table below. The Minimum Guaranteed Interest Rate at the time of issue will remain in effect for the life of the contract. We will continue to adjust the Minimum Guaranteed Interest Rate on a quarterly basis for products filed under the indexed standard non-forfeiture regulations (Apollo, Eleos). Increases or decreases in the minimum guaranteed rates will be dependent upon market conditions and will be no lower than a six month average of the five year CMT (Constant Maturity Treasury) yield minus a spread of 1.25% and will be no lower than 1.0% and no higher than 3.0%. | Product | New Rate | Old Rate | Change | | Eleos-MVA | 1.0% | 2.0% | -1.0% | | Eleos-SP | 1.0% | 2.0% | -1.0% | | Apollo-MVA | 1.0% | 2.0% | -1.0% | | Apollo-SP | 1.0% | 2.0% | -1.0% | The Guaranteed Minimum Annuity Value (100% of premium @ 1.5% for the Keystone-5 and 100% of premium @ 2.0% for the Keystone-7 and Keystone-10) will not change, and the Minimum Contract Value for Keystone contracts will be 87½% of premium minus withdrawals accumulated at the non-Forfeiture rate of 1.0%. In addition, the Minimum Guaranteed Caps and Participation rates will decline in accordance with the schedule below. | Product | New Rates | Old Rates | Change | | Keystone – 5 | | | | | Minimum Guarantee | Greater of 100% of premium, minus withdrawals accumulated at 1.5% minus surrender charges, or 87.5% or premium, minus withdrawals accumulated at 1.00% | Greater of 100% of premium, minus withdrawals accumulated at 1.5% minus surrender charges, or 87.5% or premium, minus withdrawals accumulated at 1.15% | Non Forfeiture Rate -.15% | | Annual Point to Point – Cap | 3.0% | 4.0% | -1.00% | | Annual Point to Point – Participation Rate | 10% | 25% | -15% | | Annual Monthly Average – Cap | 3.0% | 5.0% | -2.0% | | Annual Monthly Average – Participation Rate | 10% | 35% | -25% | | Keystone 7 | | | | | Minimum Guarantee | Greater of 100% of premium, minus withdrawals accumulated at 2.0% minus surrender charges, or 87.5% or premium, minus withdrawals accumulated at 1.00% | Greater of 100% of premium, minus withdrawals accumulated at 2.0% minus surrender charges, or 87.5% or premium, minus withdrawals accumulated at 1.15% | Non Forfeiture Rate -.15% | | Annual Point to Point - Cap | 3.0% | 4.0% | -1.00% | | Annual Point to Point – Participation Rate | 10% | 25% | -15% | | Annual Monthly Average - Cap | 3.0% | 5.0% | -2.0% | | Annual Monthly Average – Participation Rate | 10% | 35% | -25% | | Keystone 10 | | | | | Minimum Guarantee | Greater of 100% of premium, minus withdrawals accumulated at 2.0% minus surrender charges, or 87.5% or premium, minus withdrawals accumulated at 1.00% | Greater of 100% of premium, minus withdrawals accumulated at 2.0% minus surrender charges, or 87.5% or premium, minus withdrawals accumulated at 1.15% | Non Forfeiture Rate -.15% | | Annual Point to Point - Cap | 3.0% | 4.0% | -1.00% | | Annual Point to Point – Participation Rate | 10% | 25% | -15% | | Annual Monthly Average - Cap | 3.0% | 5.0% | -2.0% | | Annual Monthly Average – Participation Rate | 10% | 35% | -25% |
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