Harbinger Group Inc.
    Print Page | Close Window

SEC Filings

10-K
HRG GROUP, INC. filed this Form 10-K on 11/23/2016
Entire Document
 << Previous Page | Next Page >>

of the FIA contract riders that FGL offers include an additional death benefit or an increase in benefit amounts under chronic health conditions. Rider fees range from 0.4% to 0.5%.
As of September 30, 2016, the distribution of the FIA account values by cap rate and by strategy was as follows (dollars in millions):
Cap rate
 
 0% to 3%
 
 3% to 5%
 
> 5%
 
Total
1 year gain trigger
 
$
294.0

 
$
262.2

 
$
32.8

 
$
589.0

1-2 year monthly average
 
412.9

 
807.9

 
193.9

 
1,414.7

1-3 year monthly point-to-point
 
3,911.1

 
159.5

 
—

 
4,070.6

1-3 year annual point-to-point
 
1,089.9

 
1,818.4

 
352.5

 
3,260.8

3 year step forward
 
—

 
24.6

 
126.6

 
151.2

Total
 
$
5,707.9

 
$
3,072.6

 
$
705.8

 
$
9,486.3

Fixed Rate Annuities
Fixed rate annuities include annual reset and multi-year rate guaranteed policies. Fixed rate annual reset annuities issued by FGL have an annual interest rate (the “crediting rate”) that is guaranteed for the first policy year. After the first policy year, FGL has the discretionary ability to change the crediting rate once annually to any rate at or above a guaranteed minimum rate. Fixed rate multi-year guaranteed annuities (“MYGAs”) are similar to fixed rate annual reset annuities except that the initial crediting rate is guaranteed for a specified number of years before it may be changed at its discretion. For Fiscal 2016, FGL sold $93.9 million in fixed rate annual reset annuities and $536.0 million of fixed rate MYGAs. As of September 30, 2016, crediting rates on outstanding (i) single-year guaranteed annuities generally ranged from 1.5% to 6.0% and (ii) MYGAs ranged from 1.0% to 5.7%. The average crediting rate on all outstanding fixed rate annuities at September 30, 2016, was 3.3%.
As of September 30, 2016, the distribution of the fixed rate annuity account values by crediting rate was as follows (dollars in millions):
Crediting rate
 
1% to 2%
 
2% to 3%
 
3% to 4%
 
4% to 5%
 
5% to 6%
Account value
 
$
43.5

 
$
196.3

 
$
2,764.4

 
$
435.1

 
$
48.4

As of September 30, 2016, the MYGAs expiring guaranty account values, net of reinsurance by year were as follows:
 
 
Multi-Year Rate Guaranteed Annuities
Duration by Year:
 
Account Value
2017
 
$
644.2

2018
 
269.6

2019
 
769.2

2020
 
201.7

2021
 
569.7

Thereafter
 
81.2

Total
 
$
2,535.6

Withdrawal Options for Deferred Annuities
After the first year following the issuance of a deferred annuity policy, holders of deferred annuities are typically permitted penalty-free withdrawals up to 10% of the prior year’s value, subject to certain limitations. Withdrawals in excess of allowable penalty-free amounts are assessed a surrender charge if such withdrawals are made during the penalty period of the deferred annuity policy. The penalty period typically ranges from seven to fourteen years for FIAs and three to ten years for fixed rate annuities. This surrender charge initially ranges from 0.0% to 14.8% of the contract value for FIAs and 0.0% to 13.0% of the contract value for fixed rate annuities and generally decreases by approximately one to two percentage points per year during the penalty period. The average surrender charge is 8.2% for FGL’s FIAs and 5.6% for FGL’s fixed rate annuities as of September 30, 2016.

18
 << Previous Page | Next Page >>