Method and system for providing a deferred variable annuity with lifetime benefit payments related to a withdrawal percent and a deferral bonus percent

• US 20090132430A1
• Filed: 11/15/2007
• Published: 05/21/2009
• Est. Priority Date: 11/15/2007
• 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.
• Granted Patent: US 7,949,584 B2
• Time in Patent Office: Days
• US Class Current: 705/36.R
• CPC Class Codes: G06Q 20/40 Authorisation, e.g. identification of payer or payee, verification of customer or shop credentials; Review and approval of payers, e.g. check credit lines or negative lists
• CPC Class Codes: G06Q 40/00 Finance; Insurance; Tax strategies; Processing of corporate or income taxes
• CPC Class Codes: G06Q 40/02 Banking, e.g. interest calculation or account maintenance credit or loans G06Q40/03
• CPC Class Codes: G06Q 40/04 Trading; Exchange, e.g. stocks, commodities, derivatives or currency exchange
• 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;

a processor coupled to the storage device, the storage device storing modules utilized by the processor for calculating a withdrawal base, for determining a withdrawal percent, and for calculating a lifetime benefit payment;

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

((Withdrawal Percent+deferral bonus percent)×

(Withdrawal Base)); and

wherein the deferral bonus percent is a function of the number of years deferred by the relevant life until taking a first lifetime benefit payment.

2. A system for administering a deferred variable annuity contract during the accumulation phase, the annuity contract having a payment base value, a contract value, and lifetime benefit payments, comprising:

a storage device;

a processor coupled to the storage device, 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 a deferred variable annuity contract;

ii. a second module for determining a payment base value for the annuity contract;

iii. a third module for determining a contract value for the annuity contract;

iv. a fourth module for receiving lifetime benefit payment withdrawal requests from the relevant life; and

iv. a fifth module for calculating a lifetime benefit payment for the relevant life which decreases both the contract value.

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

((Withdrawal Percent+deferral bonus percent)×

(Withdrawal Base)).

4. The data processing system of claim 2, wherein the deferral bonus percent is a function of the number of years deferred by the relevant life until taking a first lifetime benefit payment.

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

a. calculating a withdrawal base

b. determining a withdrawal percent;

c. if requested by the relevant life, 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+deferral bonus percent)×

(Withdrawal Base)); and

wherein the deferral bonus percent is a function of the number of years deferred by the relevant life until taking a first lifetime benefit payment.

6. The computer implemented data processing method of by claim 5, wherein said withdrawal base equals the amount of the original premium.

7. The computer implemented data processing method of claim 5, wherein said withdrawal base equals the payment base.

8. The computer implemented data processing method of claim 5 wherein said withdrawal base equals the contract value.

9. The computer implemented data processing method of claim 5, wherein said withdrawal base equals the greater of the payment base and the contract value.

10. The computer implemented data processing method of claim 5, wherein the deferral bonus percent is between 0.00% and 1.00% for every 5 years of deferral before the relevant life takes a first lifetime benefit payment.

11. The computer implemented data processing method of claim 5, wherein the deferral bonus percent is 0.50% for every 5 years of deferral before the relevant life takes a first lifetime benefit payment.

12. The computer implemented data processing method of claim 5, wherein the deferral bonus percent is 0.75% for every 5 years of deferral before the relevant life takes a first lifetime benefit payment.

13. The computer implemented data processing method of claim 5, wherein the deferral bonus percent is 1.00% for every 5 years of deferral before the relevant life takes a first lifetime benefit payment.

14. The computer implemented data processing method of claim 5, wherein the withdrawal percent is a function of the relevant life'"'"'s attained age.

15. The computer implemented data processing method of claim 14, wherein the withdrawal percent is calculated using a given relationship between the withdrawal percent and attained age of the relevant life that provides a particular withdrawal percent for each respective attained age of the relevant life'"'"'s life.

16. The computer implemented data processing method of claim 15, wherein the withdrawal percent chart has a withdrawal percent between 1% and 10% for any given attained age.

17. The computer implemented data processing method of claim 15, wherein the withdrawal percent chart has a maximum withdrawal percent between 0% and 10% for any given attained age.

18. The computer implemented data processing method of claim 15, wherein each of the attained ages equal to or greater than 80 years old of the withdrawal percent chart has a withdrawal percent between 0% and 10%.

19. The computer implemented data processing method of claim 15, wherein the withdrawal percent relationship increases the withdrawal percent 0.5% for every 5 year increase in the relevant life.

20. The computer implemented data processing method of claim 5, wherein the lifetime benefit payment is calculated periodically.

21. The computer implemented data processing method of claim 5, wherein the lifetime benefit payment is calculated yearly.

22. The computer implemented data processing method of claim 5, wherein the lifetime benefit payment withdrawal that is requested by the relevant life is less than the maximum available amount for that period.

23. The computer implemented data processing method of claim 5, wherein once the first lifetime benefit payment withdrawal is taken, the withdrawal percent is fixed for the remainder of the contract.

24. The computer implemented data processing method of claim 5, 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) predetermined guaranteed death benefit amount; and

(b) present contract value.

25. The computer implemented data processing method of claim 5, wherein the guaranteed death benefit is paid to the beneficiary only if the relevant life dies during the accumulation phase.