BYOA Google+ Page: BYOA Google+ PageBYOA Facebook Page: BYOA Facebook PageBYOA Twitter Page: BYOA Twitter Page

hybrid fixed indexed annuity

Hybrid Fixed Indexed Annuity



A fixed indexed annuity policy whereby you deposit a lump sum amount with an insurance company for a term of five to twelve years, in return for a selection of hybrid growth allocations. Allocations usually include Triggers (a declared rate is credited if a trigger point is met), or Hybrid Blends (the mixture of a stock or bond index return with a declared fixed rate). These allocations replace the normal 'buffet style' allocations for most fixed indexed annuities.

Surrender Term

A surrender term is the maximum period you must keep a policy in force before the values may be fully withdrawn without penalty. The surrender term for a typical hybrid fixed indexed annuity ranges from 5 to 12 years, with 8 to 12 year terms being the most common.


Although liquidity varies by policy, these are the most common liquidity options that allows the owner to access the policy value without incurring a surrender penalty: required minimum distributions, ten percent annual free-out distributions, nursing home and/or terminal illness distributions, income rider payments, annuitization.


As few hybrid fixed indexed annuity products may offer an up-front accumulation value bonus for an extra fee, while most do not offer a bonus.

Growth Allocation Options

A hybrid fixed indexed annuity offers various growth allocation options by design. These may include: Blends, Spreads or Margins, Participation Rate, Mulitpliers, or Triggers

Income Options

Lifetime payment options include annuitization, or an income rider. An income rider is an optional add-on to an indexed income annuity that (in return for an annual fee) offers enhanced income rider value growth during deferral, and guaranteed lifetime income payments while in payout. Payout options include inflation or cost-of-living-adjustments ("COLA"), over a single life or joint lives.

Death Benefit

A hybrid fixed indexed annuity typically pays out the remaining account value (if any) to the policy's listed beneficiary(ies) at the death of the annuitant (or possibly owner). Some hybrid fixed indexed annuities offer an enhanced death benefit payout for an additional annual cost.