MassMutual Odyssey Select SM Product Disclosure

Transcription

1 Annuity Issuer MassMutual Odyssey Select SM (Policy form # MUFA10.1, MUFA10.1-Rev, ICC12-MUFA10.1) is a fixed deferred annuity contract issued by Massachusetts Mutual Life Insurance Company (MassMutual), 1295 State Street, Springfield, Massachusetts , Annuity Definition An annuity is a written agreement between an insurance company and a contract owner under which the insurer promises to make a series of periodic payments to a named person in exchange for a premium or a series of premiums. Annuity Type Fixed, deferred annuity. A long-term retirement product designed to help you accumulate assets and convert them into an income stream during your retirement. You should not use this annuity to meet short-term financial goals. You may pay surrender charges if you take out money before the end of the time period specified by your annuity contract. In addition to taxes due on any earnings, you also may pay a tax penalty if you withdraw money before age 59 ½. Annuity Accumulation Period Annuity Payout Period Free Look Period The time period between the date the annuity contract owner purchases a deferred annuity and the date that annuity payments begin. The time during which annuity benefit payments are made. Contract owner has the right to return the contract to the company for any reason, typically within ten (10) calendar days. Issue Age Maximum: 85 Minimum: Annuitant: None; Contract owner: 18 or age of majority Purchase Payment Amounts Minimum Guaranteed Interest Rate Guaranteed Minimum Surrender Value Rate Guarantee Duration (Any interest rate applied to purchase payments throughout the life of the contract will never be less than the minimum interest rate specified in your annuity contract. Contract minimums are subject to the laws of the state where the contract was issued.) Guarantees are based upon the claims-paying ability of the issuing company. Age of the oldest contract owner /annuitant on his or her last birthday is used to determine all applicable benefits and payout calculations. Initial purchase payment: $4,000 for qualified contracts; $10,000 for non-qualified contracts Subsequent purchase payments: $1,000; $50 with Automatic Investment Plan program. The minimum guaranteed interest rate will be 0.50% set at issue for the life of your contract. The Company will calculate a Guaranteed Minimum Surrender Value, determined in accordance with the provisions shown on page 4A of the Contract, at the time of full annuitization, death or full withdrawal of the contract value. In these instances, the Company will pay the greater of the applicable contract value or the Guaranteed Minimum Surrender Value. Two-year interest rate guarantee Offers an initial fixed interest rate (called the base rate) that is guaranteed for two years for each purchase payment. Each time that you make a purchase payment, the base rate that is applicable at that time will apply. Although base rates for individual purchase payments may differ, each will be guaranteed for two years. One-year enhanced interest rate We may offer an enhanced interest rate on individual purchase payments received in contract years one through four. If an enhanced rate is offered on a purchase payment, it will be based on rates in effect at the time of your deposit and would be guaranteed to remain in effect for one year from that date. Enhanced interest rates are offered at MassMutual s discretion and may be discontinued at any time. If an enhanced rate is discontinued, purchase payments received after that time would receive the base interest rate. Renewal interest rate After each purchase payment s two-year interest rate guarantee period ends, interest will be credited to the purchase payment at a renewal rate for a period of time that MassMutual will determine. Currently, renewal rates are guaranteed for one year and may be higher or lower than the base rate. Page 1 of 5

2 Surrender Charge Periods Partial Withdrawals (Money is withdrawn from the oldest deposit first, starting with any earned interest, then principal.) (Subject to state specifications) Full Withdrawals Free Withdrawal Provision Unused free withdrawal amounts cannot be accumulated from year to year. 5 years 8%, 7%, 6%, 5%, 4% 7 years 8%, 8%, 7%, 6%, 5%, 4%, 3% 9 years 8%, 8%, 7%, 6%, 5%, 4%, 3%, 2%, 1% Surrender charges are based on the date the contract is issued, not on each purchase payment. Charges apply to amounts withdrawn in excess of the free withdrawal amount. Minimum: $250 Currently, up to 13 withdrawals are permitted in each contract year, subject to required minimum contract value requirements. If the contract owner makes a total withdrawal of the contract withdrawal value, the contract will terminate. The contract withdrawal value at the time of a total withdrawal will not be less than the Guaranteed Minimum Surrender Value. During the accumulation phase of your annuity, you may make surrender-charge free withdrawals, up to a certain amount. The free withdrawal amount is calculated as follows: Annuity contract year one: The greater of the required minimum distribution as calculated for the contract or 10% of the contract value as determined at the time the first withdrawal is taken. Annuity contract years two and later: Equal to the greater of the required minimum distribution as calculated for the contract or 10% of the contract value as determined on the last business day of the previous contract year. Annuity Payment Start Dates Earliest: Five (5) years after the date your contract is issued. (13 months in Florida and New York) Latest: The later of the 90 th birthday of the oldest owner, joint owner, annuitant or joint annuitant, or 10 years after the date your annuity contract is issued. Annuity Payment Frequency Monthly Quarterly Semi-annually Annually Annuity Options The amount to be applied to an annuity option will be equal to the greater of the applicable contract value or the Guaranteed Minimum Surrender Value. Life Income. Income is guaranteed for the life of one annuitant. Payments cease when the annuitant dies and there is no death benefit. Life Income with Period Certain. Income is guaranteed for the specific period of time or for the life of the annuitant, which ever is longer. The period certain may be five, ten or twenty years. If the annuitant dies before the end of the period elected, annuity payments will continue to be paid to a designated beneficiary or the beneficiary may elect to have the present value of the remaining guaranteed annuity payments commuted into a lump sum. Joint and Last Survivor. Income is guaranteed for the life of the annuitant and joint annuitant. If either annuitant dies, annuity payments will continue to be paid in the same amount for the life of the surviving annuitant. Annuity payments cease when both annuitants have died. Joint and Last Survivor with Period Certain. Annuity payments will be made for the guaranteed period elected (period certain) or for the life of the annuitant and joint annuitant, whichever is longer. The period certain may be five, ten or twenty years. If either annuitant dies before the end of the period certain elected, annuity payments will continue to be paid to the surviving annuitant at the same frequency then in effect until at least the end of the period certain or the beneficiary may elect to have the present value of the remaining guaranteed annuity payments commuted and paid in a lump sum. If both annuitants die before the end of the period certain elected, annuity payments will continue to be paid at the same frequency then in effect until the end of the period certain, or the beneficiary may elect to have the present value of the remaining guaranteed annuity payments commuted and paid in a lump sum. Page 2 of 5

3 Annuity Options (Continued) Joint and Two-Thirds Survivor. Income is guaranteed for the life of the annuitant and joint annuitant. At the death of either annuitant, annuity payments continue to be paid at a reduced rate of two-thirds of the original annuity payment for the life of the surviving annuitant. Payments end when both annuitants have died. Joint and Two-Thirds Survivor with Period Certain. Annuity payments will be made for the guaranteed period elected (period certain) or for the life of the annuitant and joint annuitant, whichever is longer. The period certain may be five, ten or twenty years. If either annuitant dies before the end of the period certain elected, annuity payments will continue to be paid to the surviving annuitant at the same frequency and amount then in effect until the end of the period certain and then will continue to be paid at a reduced rate of two-thirds of the original annuity payment for the life of the surviving annuitant. If either annuitant dies after the end of the period certain elected, annuity payments will continue to be paid at a reduced rate of two-thirds of the original annuity payment for the life of the surviving annuitant. If both annuitants die before the end of the period certain elected, annuity payments will continue to be paid at the same frequency and amount then in effect until the end of the period certain or the beneficiary may elect to have the present value of the remaining period certain annuity payments commuted and paid in a lump sum. Period Certain. Income is paid for a guaranteed period of time (at least five years, but no more than thirty years) and ends when that period ends. If the annuitant dies before the end of the period certain, annuity payments will continue to be paid at the same frequency and amount then in effect until the end of the period certain, or the beneficiary may elect to have the present value of the remaining period certain annuity payments commuted and paid in a lump sum. Nursing Home & Hospital Waiver Terminal Illness Waiver Death Benefit Statement Frequency Contract Maintenance Fee Agent Compensation Premium Tax You may withdraw all or a portion of your contract value without a surrender charge provided that: You are not confined in a licensed nursing care facility or accredited hospital on the contract issue date; You make your withdrawal request at least one year after the contract issue date (the eligibility date); You request your withdrawal while you are confined to a licensed nursing care facility or accredited hospital and have been confined for at least 90 consecutive days;* Your stay in the licensed nursing facility or hospital has been prescribed by a physician. The prescribing physician may not be yourself or a parent, a sibling, a spouse or your child; Each withdrawal request is accompanied by satisfactory proof that you still reside in a facility. You may withdraw all or a portion of your contract value without a surrender charge provided that you: Were not diagnosed with a terminal illness as of the contract issue date; Make each withdrawal request at least one year after the contract issue date (the eligibility date); Provide MassMutual with proof that you are not expected to live more than 12 months. During the accumulation phase, the death benefit will be the greater of the contract value or the Guaranteed Minimum Surrender Value as of the date we receive proof of death and an election of the payment method. Any benefit payable during the income payout phase will depend upon the payout option that you select. Semi-annually None currently; we reserve the right to charge $50 annually. We pay the agent a commission for selling the annuity to you and on each purchase payment you make. A tax imposed by certain states and other jurisdictions when a purchase payment is made, when annuity payments begin or when this contract is surrendered. Page 3 of 5

4 Federal Tax Treatment A deferred fixed annuity owner generally will not be taxed on increases in the value of the annuity until a distribution occurs. When a distribution is taken, taxation depends on whether the distribution is a withdrawal or an annuity payment, as follows: 1. In general, withdrawals are taxed to the extent of any gain present in the contract at the time of the withdrawal. 2. In general, annuity payments are treated as part return of your purchase payment (which is not taxable) and part gain (which is subject to tax). If you purchase an annuity through a tax-free exchange from another annuity, some of your purchase payment may be attributable to gain. Any distribution taken from the contract before the owner reaches 59 ½ is subject to a 10% premature distribution penalty unless one of the limited exceptions applies. Buying an annuity within an IRA, 401(k), or other tax deferred retirement plan doesn t give you any extra tax benefits. Choose your annuity based on its other features and benefits as well as its risks and costs, not its tax benefits. The information provided is not written or intended as specific tax or legal advice and may not be relied on for purposes of avoiding any Federal tax penalties. MassMutual, its employees and representatives are not authorized to give tax or legal advice. Individuals are encouraged to seek advice from their own tax or legal counsel. The product and/or certain features may not be available in all states Massachusetts Mutual Life Insurance Company, Springfield, MA. All rights reserved. Page 4 of 5

5 Transactions in the State of Arkansas or Idaho Certification of MassMutual Odyssey Select SM Product Disclosure Distribution For all contracts issued in the state of Arkansas or Idaho, agents are required to complete the information requested below, certifying that they have provided their clients with the MassMutual Odyssey Select SM Product Disclosure. In addition, the following signature requirements apply: Arkansas Signature and date required from the producer only. Idaho Signature and date required from both the owner(s) and the producer. Agents should complete the Client and Agent information sections and have it signed and dated in accordance with the above listed state requirements. This page, along with the attached disclosure pages, must be submitted as part of the annuity application new business paperwork. Agents should provide a copy of this signed document to their client and retain a copy for their own files. My signature certifies that I have provided my client (listed below) with a copy of the MassMutual Odyssey Select SM Product Disclosure. SECTION I. CLIENT INFORMATION Client Name (Owner and Joint Owner, if applicable) Street Address City ST ZIP Social Security Number (Owner and Joint Owner) Owner Signature (only required in Idaho) Joint Owner Signature if applicable (only required in Idaho) SECTION II. AGENT INFORMATION Agent Name Agent Firm Street Address City ST ZIP Agent Signature (required in both Arkansas and Idaho) Page 5 of 5