ACE USA Employee Retirement Savings Plans

Transcription

1 ACE USA Employee Retirement Savings Plans Annual Fee Disclosure Statement Important Information About Your Investment Options, Fees, and Other Expenses as of June 2014 ACE USA Employee Retirement 401(k) Plan ACE USA Basic Employee Retirement Savings Plan ACE Puerto Rico Employee Retirement Savings Plan ACE Basic Puerto Rico Employee Retirement Savings Plan A. Plan-Related Information This notice gives you important plan-related information under the ACE USA Employee Retirement Savings Plans (the Plans ). You can find out more about the Plans in each Plan s Summary Plan Description (SPD). If you need help understanding this notice, please contact the Aon Hewitt Retirement Plan Service Center ( Retirement Plan Service Center ) at Part I. General Plan Information How to Give Investment Instructions. You may direct the investment of your account balance and future contributions among a range of investment options available under the Plan. To provide investment instructions for your account, log in to the participant website at or call the toll-free Retirement Plan Service Center at Limitations on Investment Instructions. Investment instructions may be subject to an investment option s trading guidelines and restrictions. Please see the Fee and Expense Information under the Investment Options section of this notice for an investment option s limitations, if any. Designated Investment Alternatives. The following investment options are available under the Plan: PIMCO Total Return, Instl. T. Rowe Price Blue Chip Growth T. Rowe Price Equity Income T. Rowe Price Inflation Protected Bd T. Rowe Price International Stock T. Rowe Price Mid Cap Growth T. Rowe Price New Horizons T. Rowe Price Retirement 2005 T. Rowe Price Retirement 2010 T. Rowe Price Retirement 2015 T. Rowe Price Retirement 2020 T. Rowe Price Retirement 2025 T. Rowe Price Retirement 2030 T. Rowe Price Retirement 2035 T. Rowe Price Retirement 2040 T. Rowe Price Retirement 2045 T. Rowe Price Retirement 2050 T. Rowe Price Retirement 2055 T. Rowe Price Retirement Income T. Rowe Price Science & Technology T. Rowe Price Small Cap Stock T. Rowe Price Stable Value T. Rowe Price U.S. Treasury Money Vanguard Inst Index Fund Page 1 of 8

2 Call your Retirement Plan Service Center at or log in to the participant website at to request investment fund prospectuses, financial statements and annual reports, and other information that is furnished to the Plan on the investment options. These materials include investment objectives, risks, fees, expenses, and other information that you should read and consider before investing. Designated Investment Managers. You may elect to receive investment advice or Professional Management service through Aon Hewitt Financial Advisors. Aon Hewitt Financial Advisors can help you allocate your assets among investments and provide you with personalized recommendations for investments. Part II. Administrative Expenses This table shows fees and expenses for general plan administrative services, which may be charged to and withdrawn from your account and are not included in the total annual operating expenses of any investment options offered under the Plan. Plan Administrative Service Recordkeeping Fees and Expenses None Plan administrative fees and expenses are not being charged to or taken from your account. Fees and expenses are paid from revenue sharing payments received from some of the plan investment options which are included in the investment options Total Annual Operating Expenses. Please see Part II below for more information on investment option fees and expenses. Part III. Individual Expenses Individual Expenses. This table shows fees and expenses for services provided to you on an individual basis that may be charged to and withdrawn from your account and are not reflected in the total annual operating expenses of any investment options offered under the Plan. Shareholder-Type Fees. This table shows fees and expenses that may be charged to and withdrawn from your account and which are not reflected in the total annual operating expenses of any investment options offered under the Plan. Individual Service Participant Loan Origination Professional Management service fees If you sign up for Professional Management with AON Hewitt Financial Advisors, you ll be charged a fee that is based on the size of your account, as shown to the right. Fees are assessed quarterly for assets under management in the Plan during the prior quarter. Fees and Expenses $50 per loan - This fee is taken out of your loan proceeds. Individual Assets Fee Up to the first $100, % of assets The next $100,001 to $250, % of assets $250,001 or more 0.30% of assets Learn more about applicable plan fees at > Savings and Retirement > Plan Information and News. Page 2 of 8

3 Name Shareholder-Type Fees T. Rowe Price International Stock Redemption fee 2% on shares held for 90 days or less Fund T. Rowe Price Stable Value Fund Dollars withdrawn may not be transferred to a competing fund for 90 days after withdrawal B. Investment Options This section includes important information to help you compare the investment options under your retirement plan. If you want additional information about your investment options, you can go to the specific Internet website address shown below or you can call the toll-free Retirement Plan Service Center at A free paper copy of the additional information available on the website can be obtained by contacting the Retirement Plan Service Center at This section has three parts. Part I consists of performance information for plan investment options. This part shows you how well the investments have performed in the past. Part II shows you the fees and expenses you will pay if you invest in an option. Part III, if applicable, contains information about the annuity options under your retirement plan. Table 1 focuses on the performance of investment options that do not have a fixed or stated rate of return. Table 1 shows how these options have performed over time and allows you to compare them with an appropriate benchmark for the same time periods. Past performance does not guarantee how the investment option will perform in the future. Your investment in these options could lose money. Information about an option s principal risks is available at Part I. Performance Information Table 1 Variable Return Investments Average Annual Total Return as of 12/31/2013 Benchmark Name/Type of Option 1 yr. 5 yr. 10 yr. Incept. 1 yr. 5 yr. 10 yr. Retirement Fund Incept. T. Rowe Price Retirement 2005 Target Date % 11.48% 6.17% 1.54% 6.57% 5.21% 5.03% Dow Jones Global Target 2005 Index 9.86% 9.68% 5.61% Combined Index Portfolio 2005 T. Rowe Price Retirement 2010 Target Date % 12.78% 6.63% 8.46% 3.00% 7.47% 5.50% 7.15% Dow Jones Global Target 2010 Index 12.00% 10.95% 6.11% 7.85% Combined Index Portfolio 2010 T. Rowe Price Retirement 2015 Target Date % 14.32% 6.85% 5.49% 8.86% 5.94% 5.70% Dow Jones Global Target 2015 Index 14.97% 12.32% 6.25% Combined Index Portfolio 2015 Page 3 of 8

4 Average Annual Total Return as of 12/31/2013 Benchmark Name/Type of Option 1 yr. 5 yr. 10 yr. Incept. 1 yr. 5 yr. 10 yr. T. Rowe Price Retirement 2020 Target Date Retirement Fund Incept % 15.61% 7.35% 9.53% 9.05% 10.56% 6.60% 8.86% Dow Jones Global Target 2020 Index 17.56% 13.48% 6.73% 8.77% Combined Index Portfolio 2020 T. Rowe Price Retirement 2025 Target Date % 16.63% 7.40% 12.84% 12.47% 7.24% 6.93% Dow Jones Global Target 2025 Index 20.01% 14.47% 6.74% Combined Index Portfolio 2025 T. Rowe Price Retirement 2030 Target Date % 17.50% 7.87% 10.24% 16.59% 14.20% 7.75% 10.43% Dow Jones Global Target 2030 Index 22.13% 15.26% 7.23% 9.56% Combined Index Portfolio 2030 T. Rowe Price Retirement 2035 Target Date % 18.06% 7.70% 19.90% 15.59% 8.12% 7.78% Dow Jones Global Target 2035 Index 23.76% 15.84% 7.06% Combined Index Portfolio 2035 T. Rowe Price Retirement 2040 Target Date % 18.28% 8.04% 10.43% 22.38% 16.51% 8.35% 11.11% Dow Jones Global Target 2040 Index 24.73% 16.06% 7.41% 9.72% Combined Index Portfolio 2040 T. Rowe Price Retirement 2045 Target Date % 18.29% 7.94% 23.71% 16.89% 8.48% 8.12% Dow Jones Global Target 2045 Index 24.73% 16.06% 7.25% Combined Global Index Portfolio 2045 T. Rowe Price Retirement 2050 Target Date % 18.26% 6.08% 23.89% 16.93% 8.50% 5.89% Dow Jones Global Target 2050 Index 24.73% 16.06% 5.48% Combined Index Portfolio 2050 T. Rowe Price Retirement 2055 Target Date % 18.27% 6.07% 24.94% 17.13% 8.59% 6.02% Dow Jones Global Target 2055 Index 24.73% 16.06% 5.48% Combined Index Portfolio 2055 T. Rowe Price Retirement Income Retirement Income 9.16% 10.37% 5.82% 7.00% 8.13% 9.45% 5.96% 7.46% DJ Moderately Cons Port Index 9.23% 8.45% 5.19% 6.17% Page 4 of 8

5 Average Annual Total Return as of 12/31/2013 Benchmark Name/Type of Option 1 yr. 5 yr. 10 yr. Incept. 1 yr. 5 yr. 10 yr. Stocks Combined Index Portfolio Income Incept. T. Rowe Price Blue Chip Growth Fund / Large Growth 41.57% 23.08% 8.81% 10.43% 32.39% 17.94% 7.41% 9.24% S&P 500 Index 35.41% 19.43% 7.08% 7.61% Lipper Large-Cap Growth Funds Index T. Rowe Price Equity Income Fund Large Value 29.75% 16.92% 7.56% 11.32% 32.39% 17.94% 7.41% 10.97% S&P 500 Index 33.24% 16.36% 6.84% 10.23% Lipper Large Cap Value Funds Index T. Rowe Price International Stock Fund / Foreign Large Growth 14.27% 15.69% 6.79% 9.57% 15.29% 12.82% 7.57% MSCI All Country World Ex US Index 18.45% 13.32% 7.03% Lipper Int l Large-Cap Growth Average T. Rowe Price Mid-Cap Fund Growth Mid-Cap Growth 36.89% 23.47% 11.45% 14.08% 35.74% 23.37% 9.77% 10.26% Russell Mid Cap Growth Index 36.52% 21.31% 9.49% 9.86% Lipper Mid-Cap Growth Funds Index T. Rowe Price New Horizons Fund Small Growth 49.11% 29.05% 12.68% 11.65% 43.30% 22.58% 9.41% Russell 2000 Growth Index 40.99% 22.20% 8.27% Lipper Small-Cap Growth Funds Index T. Rowe Price Science & Technology Fund / Technology 43.70% 24.29% 7.60% 10.25% 32.39% 17.94% 7.41% 9.33% S&P 500 Index 36.79% 22.39% 7.69% 8.98% Lipper Science & Technology Funds Index T. Rowe Price Small Cap Stock Fund Small Blend 37.65% 24.39% 10.97% 12.86% 38.82% 20.08% 9.07% Russell 2000 Index 36.13% 20.75% 9.33% Lipper Small-Cap Core Funds Index Vanguard Institutional Index Fund Large Blend 32.35% 17.95% 7.41% 9.59% 32.39% 17.94% 7.41% 9.57% S&P 500 Index 31.82% 17.07% 7.61% 8.59% Lipper Large-Cap Core Funds Index Page 5 of 8

6 Average Annual Total Return as of 12/31/2013 Benchmark Name/Type of Option 1 yr. 5 yr. 10 yr. Incept. 1 yr. 5 yr. 10 yr. Bonds Incept. PIMCO Total Return Instl. Fund Intermediate Term Bond T. Rowe Price Inflation Protected Bond Fund / Inflation Protected Bond -1.92% 6.92% 6.04% 7.98% -2.02% 4.44% 4.55% 6.88% Bar U.S. Aggregate -8.77% 4.99% 4.35% 4.85% -8.61% 5.63% 4.86% 5.40% Barclays Capital U.S. TIPS -7.82% 5.51% 4.46% Lipper TIPS Average Money Market/Stable Value T. Rowe Price Stable Value Fund 2.26% 3.31% 3.89% 4.38% 0.06% 0.09% 1.59% 2.04% Citigroup 3-Month Treasury Bill Index T. Rowe Price U.S. Treasury Money Fund 0.01% 0.02% 1.32% 3.97% 0.06% 0.09% 1.59% 4.36% Citigroup 3-Month Treasury Bill Index 0.00% 0.02% 1.29% Lipper U.S. Treasury Money Market Funds Average Note: All returns for periods greater than one year are annualized. All returns for periods of one year or less are cumulative. Part II. Fee and Expense Information Table 2 shows fee and expense information for the investment options listed in Table 1. Table 2 shows the Total Annual Operating Expenses of the options in Table 1. Total Annual Operating Expenses are expenses that reduce the rate of return of the investment option. Table 2 also shows Shareholder-Type Fees. These fees are in addition to Total Annual Operating Expenses. Table 2 Fees and Expenses Name/Type of Option Total Annual Operating Expenses 1 As a % Per $1,000 Shareholder-Type Fees and Restrictions Retirement Fund T. Rowe Price Retirement 2005 Target Date T. Rowe Price Retirement 2010 Target Date % $5.90 Subject to a 30-Day Purchase Block % $6.10 Subject to a 30-Day Purchase Block 2 1 Total Annual Operating Expenses: The cost associated with operating the fund, including investment management fees and additional expenses such as custodian, legal, and audit fees, and other operational expenses incurred by the investment manager. 2 This investment restricts a participant s exchange into a fund for a period of 30 calendar days after the participant has exchanged out of the same fund (the 30-Day Purchase Block ). In addition, the investment sponsor reserves the right to cancel or reject, without further notice, any exchange that is deemed to result in excessive or short-term trading. Page 6 of 8

7 Name/Type of Option Total Annual Operating Expenses 1 As a % Per $1,000 Shareholder-Type Fees and Restrictions Retirement Fund (cont d) T. Rowe Price Retirement 2015 Target Date T. Rowe Price Retirement 2020 Target Date T. Rowe Price Retirement 2025 Target Date T. Rowe Price Retirement 2030 Target Date T. Rowe Price Retirement 2035 Target Date T. Rowe Price Retirement 2040 Target Date T. Rowe Price Retirement 2045 Target Date T. Rowe Price Retirement 2050 Target Date T. Rowe Price Retirement 2055 Target Date T. Rowe Price Retirement Income Retirement Income Stocks T. Rowe Price Blue Chip Growth Fund Large Growth T. Rowe Price Equity Income Fund Large Value T. Rowe Price International Stock Fund Foreign Large Growth T. Rowe Price Mid-Cap Growth Fund Mid-Cap Growth T. Rowe Price New Horizons Fund Small Growth T. Rowe Price Science & Technology Fund / Technology T. Rowe Price Small Cap Stock Fund Small Blend Vanguard Institutional Index Fund Large Blend 0.66% $6.60 Subject to a 30-Day Purchase Block % $7.00 Subject to a 30-Day Purchase Block % $7.30 Subject to a 30-Day Purchase Block % $7.50 Subject to a 30-Day Purchase Block % $7.70 Subject to a 30-Day Purchase Block % $7.80 Subject to a 30-Day Purchase Block % $7.80 Subject to a 30-Day Purchase Block % $7.80 Subject to a 30-Day Purchase Block % $7.80 Subject to a 30-Day Purchase Block % $5.70 Subject to a 30-Day Purchase Block % $7.60 Subject to a 30-Day Purchase Block % $6.80 Subject to a 30-Day Purchase Block % $8.50 Redemption fee 2% on shares held for 90 days or less; subject to a 30-Day Purchase Block % $8.00 Subject to a 30-Day Purchase Block % $8.00 Subject to a 30-Day Purchase Block % $8.80 Subject to a 30-Day Purchase Block % $9.20 Subject to a 30-Day Purchase Block % $0.40 Subject to a 30-Day Purchase Block 2 1 Total Annual Operating Expenses: The cost associated with operating the fund, including investment management fees and additional expenses such as custodian, legal, and audit fees, and other operational expenses incurred by the investment manager. 2 This investment restricts a participant s exchange into a fund for a period of 30 calendar days after the participant has exchanged out of the same fund (the 30-Day Purchase Block ). In addition, the investment sponsor reserves the right to cancel or reject, without further notice, any exchange that is deemed to result in excessive or short-term trading. Page 7 of 8

8 Name/Type of Option Total Annual Operating Expenses 1 As a % Per $1,000 Shareholder-Type Fees and Restrictions Bonds PIMCO Total Return Instl. Fund Intermediate Term Bond T. Rowe Price Inflation Protected Bond Fund / Inflation Protected Bond Money Market/Stable Value T. Rowe Price Stable Value Common Trust T. Rowe Price U.S. Treasury Money Fund 0.46% $ % $5.60 Subject to a 30-Day Purchase Block % $3.40 Dollars withdrawn may not be transferred to a competing fund for 90 days after withdrawal 0.44% $4.40 The cumulative effect of fees and expenses can substantially reduce growth of your retirement savings. Visit the Department of Labor s website at for an example showing the long-term effect of fees and expenses. Fees and expenses are only one of many factors to consider when you decide to invest in an option. You may also want to think about whether an investment in a particular option, along with your other investments, will help you achieve your financial goals. Please visit > Savings and Retirement >Plan Information and News for a glossary of investment terms relevant to the investment options under these Plans. This glossary is intended to help you better understand your options. 1 Total Annual Operating Expenses: The cost associated with operating the fund, including investment management fees and additional expenses such as custodian, legal, and audit fees, and other operational expenses incurred by the investment manager. 2 This investment restricts a participant s exchange into a fund for a period of 30 calendar days after the participant has exchanged out of the same fund (the 30-Day Purchase Block ). In addition, the investment sponsor reserves the right to cancel or reject, without further notice, any exchange that is deemed to result in excessive or short-term trading. Page 8 of 8