Method and system for a deferred variable annuity with lifetime benefit payments as a function of a predetermined time-based withdrawal percent table

• US 20090030824A1
• Filed: 11/21/2007
• Published: 01/29/2009
• Est. Priority Date: 07/24/2007
• Status: Active Grant

• Current Assignee: Hartford Fire Insurance Company (The Hartford Financial Services Group, Inc.)
• Original Assignee: Hartford Fire Insurance Company (The Hartford Financial Services Group, Inc.)
• Inventors: Weiss, Joseph M., Michalowski, Philip W.
• Granted Patent: US 7,877,306 B2
• Time in Patent Office: Days
• US Class Current: 705/35
• CPC Class Codes: G06Q 40/00 Finance; Insurance; Tax strategies; Processing of corporate or income taxes
• CPC Class Codes: G06Q 40/06 Asset management; Financial planning or analysis
• CPC Class Codes: G06Q 40/08 Insurance

Abstract

A computer implemented data processing system and method administers a deferred variable annuity contract during the accumulation phase for a relevant life. The annuity contract has a payment base value, a contract value, and a step-up provision. Administration of the product determines whether a step-up of the payment base value is applicable. If applicable, the product determines a step-up, wherein the step-up is guaranteed at a predetermined percentage. The investments of the deferred variable annuity contract are not limited to a specific asset allocation in order to qualify for the step-up provision.

Claims

1. A data processing system for administering a deferred variable annuity contract, the annuity contract having a payment base value, a contract value, and lifetime benefit payments, said system comprising:

a storage device having data relating to the annuity contract, the payment base value, the contract value, and the lifetime benefit payments; and

a processor operatively coupled to the storage device to read said data relating to the payment base value, the contract value, and the lifetime benefit payments, the storage device storing modules utilized by the processor for calculating a payment base, for calculating a contract value, for calculating a withdrawal percent relationship that provides a particular withdrawal percent for each respective completed year since the purchase date of the contract, wherein at least a portion of the respective completed years provide a withdrawal percent that is equal to the number of completed years since the purchase date of the contract, and for calculating a lifetime benefit payment.

2. The data processing system of claim 1, wherein the lifetime benefit payment withdrawal is calculated using the following formula:

((withdrawal percent)×

(withdrawal base)).

3. The data processing system of claim 2, wherein the withdrawal percent is predetermined according to the withdrawal percent relationship.

4. The data processing system of claim 3, wherein the lifetime benefit payment is paid periodically.

5. The data processing system of claim 4, wherein the maximum available amount for that period is greater than the lifetime benefit payment withdrawal that is requested by the relevant life.

6. A data processing system for administering a deferred variable annuity contract during the accumulation phase for a relevant life, the annuity contract having a payment base value, a contract value, and lifetime benefit payments, said system comprising:

a storage device having data relating to the annuity contract, the payment base value, the contract value, and the lifetime benefit payments;

a processor operatively coupled to the storage device to read said data relating to the annuity contract, the payment base value, the contract value, and the lifetime benefit payments, the storage device storing modules utilized by the processor, the modules comprising;

i. a first module for receiving information from a relevant life in order to establish the deferred variable annuity contract;

ii. a second module for receiving lifetime benefit payment withdrawal requests from the relevant life;

iii. a third module for calculating a withdrawal percent relationship that provides a particular withdrawal percent for each respective completed year since the purchase date of the contract and wherein at least a portion of the respective completed years provide a withdrawal percent that is equal to the number of completed years since the purchase date of the contract; and

iv. a forth module for calculating a lifetime benefit payment.

7. The data processing system of claim 6, wherein the lifetime benefit payment withdrawal is calculated using the following formula:

((withdrawal percent)×

(withdrawal base)).

8. The data processing system of claim 7, wherein the withdrawal percent is predetermined according to the withdrawal percent relationship.

9. The data processing system of claim 6, wherein the maximum available amount for that period is greater than the lifetime benefit payment withdrawal that is requested by the relevant life.

10. The data processing system of claim 6, wherein the lifetime benefit payment is paid periodically.

11. The data processing system of claim 6, wherein said withdrawal base equals the contract value.

12. The data processing system of claim 6, wherein said withdrawal base equals the greater of the payment base or the contract value.

13. A computer implemented data processing method for administering a deferred variable annuity contract during the accumulation phase for a relevant life, the annuity contract having a payment base, a contract value, and lifetime benefit payments, said method comprising the steps of:

a. calculating a payment base for said annuity contract;

b. calculating a contract value for said annuity contract;

c. calculating a withdrawal percent relationship that provides a particular withdrawal percent for each respective completed year since the purchase date of the contract and wherein at least a portion of the respective completed years provide a withdrawal percent that is equal to the number of completed years since the purchase date of the contract;

d. if requested by the relevant life, periodically calculating a lifetime benefit payment withdrawal for the relevant life which decreases the contract value;

wherein the lifetime benefit payment withdrawal is calculated using the following formula;

((withdrawal percent)×

(withdrawal base)); and

wherein the withdrawal percent is calculated using said withdrawal percent relationship.

14. The computer implemented data processing method of by claim 13, wherein said withdrawal base equals the amount of the original premium.

15. The computer implemented data processing method of claim 13, wherein said withdrawal base equals the payment base.

16. The computer implemented data processing method of claim 13, wherein said withdrawal base equals the contract value.

17. The computer implemented data processing method of claim 13, wherein said withdrawal base equals the greater of the payment base or the contract value.

18. The computer implemented data processing method of claim 13, wherein the withdrawal percent relationship has a maximum withdrawal percent within the range of 0% to 15% for any given completed year.

19. The computer implemented data processing method of claim 13, wherein the available withdrawal percent relationship increases the available withdrawal percent by 1% for the first 5 completed years and for every completed year thereafter.

20. The computer implemented data processing method of claim 13, wherein the maximum available amount for that period is greater than the lifetime benefit payment withdrawal that is requested by the relevant life.

21. The computer implemented data processing method of claim 13, further comprising the step of collecting a rider fee.

22. The computer implemented data processing method of claim 13, further comprising the step of collecting an account maintenance fee.

23. The computer implemented data processing method of claim 13, further comprising the step of calculating a benefit amount for said annuity contract that is equal to the premium payments minus any lifetime benefit payments or withdrawals.

24. The computer implemented data processing method of claim 13, further comprising the step of calculating a death benefit for a beneficiary upon the death of the relevant life, wherein the death benefit is the greater of (a) a predetermined guaranteed death benefit amount;

or (b) the present contract value.

25. The computer implemented data processing method of claim 24, wherein the guaranteed death benefit is paid to the beneficiary only if the relevant life dies during the accumulation phase.