Release version of non-US variable annuity module available
8 April 2008
Given the growing popularity of variable annuity-style products in markets around the world, we have been working on modules to allow these to be modelled using the iWORKS Prophet libraries used outside of North America. We are pleased to announce that the release version of the variable annuity module for the Unit Linked and International libraries is now available. For both of these libraries this module includes the following features:
- Multi-fund functionality – each model point can invest in as many different funds as required, each with their own assumptions regarding growth, charges and deductions and with transfers between funds.
- Guaranteed Minimum Death Benefit (GMDB) – 6 options including return of premiums, rollup and ratchet.
- Guaranteed Minimum Withdrawal Benefit (GMWB) – choice of reducing fund or lifetime option, with optional bonus credits and ratchet.
- Guaranteed Minimum Accumulation Benefit (GMAB) – guaranteed percentage of premiums paid less withdrawals at flexible dates, with balance either paid to policyholder or added to fund.
- Guaranteed Minimum Income Benefit (GMIB) - based on a guaranteed growth in the underlying fund and guaranteed annuity rates at retirement.
- Annuity conversion - option for the fund to convert to an annuity or for the benefit to be taken in the form of a lump sum.
- Reserving - unit reserves, sterling reserves (U library only), value of the annuity element and reserve for the guarantees (percentage of fund or discounted costs less charges).
- Pricing - value at point of sale of the guarantee costs and charges, either using a fixed discount rate or a market-consistent approach.
This release version also includes online documentation for all the new features.
We have also started work on a module to model variable annuities within the ALS library and plan to release this module later this year.
Please note these modules are only intended for customers outside of the US as variable annuities have always been a standard product in the US library.
If you would like to discuss the variable annuity module or you are interested in evaluating it then please contact your normal SunGard account manager.
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