METHOD AND SYSTEM FOR ADMINISTERING INDEX-LINKED ANNUITY

• US 20080306878A1
• Filed: 06/05/2007
• Published: 12/11/2008
• Est. Priority Date: 06/05/2007
• Status: Abandoned Application

• Current Assignee: Lincoln National Life Insurance Company (Lincoln National Corporation)
• Original Assignee: Lincoln National Life Insurance Company (Lincoln National Corporation)
• Inventors: Chen, Shuang, Elam, Charles Phillip II
• Application Number:
  US11/758,486
• Publication Number:
  US 20080306878A1
• Time in Patent Office: Days
• US Class Current: 705/36R
• CPC Class Codes: G06Q 40/02 Banking, e.g. interest calculation or account maintenance credit or loans G06Q40/03
• CPC Class Codes: G06Q 40/06 Asset management; Financial planning or analysis

Abstract

A method for administering an annuity product comprises the steps of establishing an annuity account, storing data relating to the account, determining an amount of an income payment and paying the income payment to the account owner. The amount of the income payment is subtracted from an account value. The amount of the account value is adjusted by a first process which includes adjusting the account value by a first index. The amount of the income payment is periodically redetermined by a second process which includes adjusting the amount of the income payment by a second index. The first and second processes are separate processes designed to cause the account value and a present value of the income payments to diverge, such that the value of the income payments becomes increasingly greater relative to the account value during a payout phase of the annuity account. One embodiment comprises a computer system for administering the annuity product in accordance with the subject method.

Claims

1. A method for administering an annuity product, comprising the steps of:

a. establishing an annuity account;

b. storing data relating to the annuity account, including data relating to an account owner, an account value, and at least one index;

c. determining an amount of an income payment;

d. paying the income payment to the account owner and subtracting the amount of the income payment from the account value;

e. adjusting the account value by a first process which includes adjusting the account value by a first index;

f. re-determining the amount of the income payment by a second process which includes adjusting the amount of the income payment by a second index;

g. periodically repeating steps d, e and f;

h. wherein said first and second processes are separate processes designed to cause the account value and a present value of the periodic income payments to diverge, such that the value of the periodic income payments becomes increasingly greater relative to the account value during a payout phase of the annuity account.

2. The method of claim 1, further comprising the steps of:

allowing the account owner to receive an unscheduled payment from the account value; and

adjusting the amount of the income payment in response to the unscheduled payment.

3. The method of claim 1, further comprising the step of:

determining an amount of a minimum guaranteed income payment; and

wherein, the step of periodically paying the income payment to the account owner comprises periodically paying the greater of the income payment and the minimum guaranteed income payment to the account owner.

4. The method of claim 3, further comprising the step of re-determining the amount of the minimum guaranteed income payment.

5. The method of claim 1, further comprising the step of providing a death benefit to the account owner.

6. The method of claim 5, wherein the death benefit is equal to the account value.

7. The method of claim 5, further comprising the steps of:

determining a mortality risk charge; and

periodically subtracting the mortality risk charge from the account value.

8. The method of claim 1, further comprising the steps of:

providing a cash surrender value to the account owner; and

periodically determining an amount of the cash surrender value.

9. The method of claim 1, wherein the first index is selected from a group which consists of the Standard &

Poor'"'"'s 500, the Goldman Sachs Commodity Index, the Consumer Price Index, a fixed interest rate, a Corporate Bond Yield Index, and a U.S. Treasury Index.

10. The method of claim 1, wherein the second index is selected from a group which consists of the Standard &

Poor'"'"'s 500, the Goldman Sachs Commodity Index, the Consumer Price Index, a fixed interest rate, a Corporate Bond Yield Index, and a U.S. Treasury Index.

11. The method of claim 1, wherein the first index and the second index are the same.

12. The method of claim 1, wherein the first index is the greater of a plurality of designated indices.

13. The method of claim 1, wherein the second index is the greater of a plurality of designated indices.

14. The method of claim 1, wherein at least one of said first and second indices is adjusted as part of at least one of said first and second processes.

15. The method of claim 1, further comprising the step of establishing at least one of a minimum value and a maximum value of the first index.

16. The method of claim 1, further comprising the step of establishing at least one of a minimum value and a maximum value of the second index.

17. The method of claim 1, further comprising the steps of:

establishing a charge associated with the annuity product; and

periodically deducting the charge from the account value.

18. The method of claim 1, further comprising the step of periodically reporting the account value to the account owner.

19. A data processing system for administering an annuity product, comprising:

a. a memory for storing data relating to an annuity account, including data relating to an account owner, an account value, and at least one index;

b. means for determining an amount of an income payment;

c. means for paying the income payment to the account owner and subtracting the amount of the income payment from the account value;

d. means for adjusting the account value by a first process which includes adjusting the account value by a first index; and

f. means for re-determining the amount of the income payment by a second process which includes adjusting the amount of the income payment by the second index;

wherein said first and second processes are separate processes designed to cause the account value and a present value of the periodic income payments to diverge, such that the value of the periodic income payments becomes increasingly greater relative to the account value during a payout phase of the annuity account.

20. The system of claim 19, further comprising means for providing an unscheduled payment to the account owner, and for adjusting the amount of the income payment in response to the unscheduled payment.