Method and system for a deferred variable annuity with benefit payments as a function of an adjustment factor

• US 8,788,383 B2
• Filed: 02/11/2011
• Issued: 07/22/2014
• 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: Golembiewski, Keith E
• Primary Examiner(s): Apple, Kirsten
• Assistant Examiner(s): Trotter, Scott S
• Application Number:
  US13/025,596
• Publication Number:
  US 20110131152A1
• Time in Patent Office: 1,257 Days
• Field of Search: 705/4, 705/35
• 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 processes data associated with a deferred variable annuity contract during the accumulation phase for a relevant life. The data includes a payment base value, a contract value, a withdrawal percent and a formula for determining an available benefit payment amount without reduction of the payment base value. The formula includes as factors the payment base value, the withdrawal percent, and an adjustment factor dependent on a period of deferral from a time a benefit payment withdrawal was first available until a first benefit payment withdrawal request and a period of time since the first benefit payment withdrawal request.

Claims

1. A computer system for processing data associated with a deferred variable annuity contract during the accumulation phase, comprising:

a storage device including data relating to the deferred variable annuity contract, including;

a payment base value, a contract value, a withdrawal percent value, a withdrawal base value, and data indicative of a guarantee of available periodic benefit payments; and

a processor operatively coupled to the storage device, the processor configured to;

determine a maximum benefit payment available in a period in accordance with the guarantee, the determination of the maximum benefit payment available being based on a product of the withdrawal percent value, the withdrawal base value and a factor, the factor being at least 1 and having a value determined in accordance with a formula, the formula causing the value of the factor to increase responsive to an increase in either or both of (1) duration between a time one of the benefit payments was first available and a time of a first one of the benefit payments; and

(2) duration from a first one of the benefit payments until the period; and

provide an output signal having data indicative of the determined maximum benefit payment available in the period.

2. The computer system of claim 1, wherein withdrawals do not decrease the payment base value when the cumulative withdrawals during a period are not more than the maximum available benefit payment for the period.

3. The computer system of claim 1, further comprising a communication module in communication with the processor and configured to receive via a network data indicative of a requested withdrawal.

4. The computer system of claim 3, further comprising a payment module in communication with the processor, the payment module being configured to effect payments of requested withdrawals to a relevant life.

5. The computer system of claim 4, further comprising a contract generating module configured to generate insurance contracts including the deferred variable annuity contract.

6. The computer system of claim 1, wherein the processor is further configured to increase the value of the factor incrementally with milestones of the duration between a time one of the benefit payments was first available and a first one of the benefit payments.

7. The computer system of claim 1, wherein the benefit payments are available annually for a lifetime of a relevant life.

8. A computer-implemented method for processing data related to a deferred variable annuity contract during the accumulation phase, comprising:

storing in a storage device data relating to the deferred variable annuity contract, including;

a payment base value, a contract value, a withdrawal percent value, a withdrawal base value, and data indicative of a guarantee of available periodic benefit payments;

determining by a processor in communication with the storage device a maximum benefit payment available in a current period in accordance with the guarantee, the determination of the maximum benefit payment available being based on a product of the withdrawal percent value, the withdrawal base value and a factor, the factor being at least 1 and determined in accordance with a formula, the formula causing the value of the factor to increase responsive to an increase in either or both of (1) duration between a time one of the benefit payments was first available and a time of a first one of the benefit payments; and

(2) duration from the time of the first one of the benefit payments until the current period; and

providing an output signal by the processor having data indicative of the determined maximum available benefit payment.

9. The computer-implemented method of claim 8, further comprising a communications port in communication with the processor and configured to communicate via a network to a relevant life the data indicative of the determined maximum available benefit payment.

10. The computer-implemented method of claim 8, wherein the withdrawal base value is not less than the payment base value, and withdrawals do not decrease the payment base value when the cumulative withdrawals during a period are not more than the maximum available benefit payment for the period.

11. The computer-implemented method of claim 10, wherein the payment base value is initially equal to a sum of premiums paid.

12. The computer-implemented method of claim 8, wherein the factor is determined based on a number of completed periods from a time one of the benefit payments was first available until a first one of the benefit payments and a predetermined factor to obtain an intermediate value, adding 1 to the intermediate value to obtain a sum, and raising the sum to a power based on the number of completed and partial periods from the first one of the benefit payments to the current period.

13. The computer-implemented method of claim 12, wherein the predetermined factor is in the range of 0.0005 to 0.02.

14. The computer-implemented method of claim 12, wherein the periods are one year in duration.

15. A non-transitory computer-readable medium having processor-executable instructions stored thereon, which instructions, when executed by a processor, cause the processor to:

access from a storage device in communication with the processor data relating to a deferred variable annuity contract, including;

a payment base value, a contract value, a withdrawal percent value, a withdrawal base value, and data indicative of a guarantee of available periodic benefit payments; and

determine a maximum benefit payment available in a current period in accordance with the guarantee, the determination of the maximum benefit payment available being based on a product of the withdrawal percent value, the withdrawal base value and a factor, the factor being at least 1 and having a value determined in accordance with a formula, the formula causing the value of the factor to increase responsive to an increase in either or both of (1) duration between a time one of the benefit payments was first available and a first one of the benefit payments; and

(2) duration from the first one of the benefit payments to the current period.

16. The non-transitory computer-readable medium of claim 15, wherein the instructions further cause the processor to:

access data indicative of a maximum value of a product of the withdrawal percent and the factor.

17. The non-transitory computer-readable medium of claim 15, wherein the instructions further cause the processor to:

compare the maximum benefit payment available in the current period to a sum of withdrawals during the current period and, responsive to determining that the sum of withdrawals during the period exceeds the maximum benefit payment available, determine a reduction in the payment base value, and provide an output signal indicative of the reduced payment base value.

18. The non-transitory computer-readable medium of claim 17, wherein the instructions further cause the processor to determine the contract value based on adding a sum of purchase payments, subtracting fees and surrenders, and adjusting for performance of investment options selected by an owner of the contract.

19. The non-transitory computer-readable medium of claim 18, wherein the factor is determined based on an intermediate value, the intermediate value being based on a number of completed periods from a time one of the benefit payments was first available until a first one of the benefit payments and a predetermined factor, and raising the intermediate value to a power based on a number of partial and completed periods subsequent to the first one of the benefit payments.

20. The non-transitory computer-readable medium of claim 19, wherein the periods are each one year in duration.