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A Protective® Market Defender Annuity is a registered index-linked annuity designed to help protect investments from a major loss while participating in market-linked growth based on the performance of a selected market index.
Protective Market Defender is a registered index-linked annuity that allows for more generous participation in market gains than with traditional FIA's but allows for limited loss. This type of product references the performance of a particular market index to calculate gains or losses, but the investor is not directly placing money into that index.
Protective Market Defender can help defend your investments from major market downturns while allowing investors to participate in market-linked growth, and they can be tailored to the investor’s risk tolerance and investment preferences.
Market losses triggered by an industry collapse or tragic event can happen at any time. Limit losses caused by major market downturns.
Money is not invested directly in an index or stock market, but gains or losses are based on the performance of the index the investor chooses.
There are no annual fees charged for Protective Market Defender, helping you keep more of what you earn.
Withdraw a portion of contract value each year without incurring a withdrawal charge or market value adjustment
Options are available to annuitize the contract and allow for guaranteed income payments for the length of time you choose.
Protective Market Defender includes a death benefit at no additional cost.
1. An interim value calculation will apply. The interim value calculation may reduce the remaining contract value by more that the dollar amount of the withdrawal taken.
2. Withdrawals in excess of the penalty-free amount may be subject to a surrender charge during the withdrawal charge period.
3. Gains will be taxed as ordinary income upon withdrawal.
For investors nearing retirement, it can be a priority to protect investments from a major loss. After all, when you’re nearing retirement, you may not have time for your investments to recover. You may also be surprised at how much it takes to recover and gain back the earnings you would have made without the downturn. The chart below shows the gains generally needed to bring your investments back to break-even.
It’s important to have a plan to limit losses. The chart below shows the gains generally needed to recover from various levels of loss and bring investments back on plan.
-10%
11%
-20%
25%
-30%
43%
-40%
67%
-50%
100%
This chart is for illustrative purposes only and does not represent the performance of any security.
Protective Market Defender offers ways to position your investment for growth while addressing the potential for loss during down markets - without charging annual fees.
Protective Life offers a wide variety of annuities to meet your needs. To learn more, call 1-800-833-8991.
Protective Market Defender can help you protect your money and diversify an investment by creating segments that allow for various levels of growth and protection. For each segment you’ll select the:
Allocation amount or how much of your overall investment will be applied to particular segments.
Allocation strategy, whereby you determine which segments will leverage a guaranteed interest strategy to earn a fixed rate of interest or utilize an indexed strategy that earns interest or deducts losses based, in part, on the performance of the segment’s index over its term (see Guaranteed versus Indexed Strategy).
Protection level or the maximum loss an indexed segment can experience due to negative index performance during a term (-5%, -10%, or -20%). The protection level is available for Indexed Strategies only.
With Protective Market Defender you can choose up to 100 different segments with different start dates and strategies. First you allocate funds by segment and define the strategy for each. A segment will mature after a term of one year, at which point you can choose to renew the current allocation, create a new one, or allow the matured segment value to transfer to an interest-bearing Declared Rate Account to await allocation instructions.
Here’s an example of how an initial purchase payment could be allocated.
You can choose a strategy based on your needs and level of risk tolerance.
Guaranteed Interest: Segments using a guaranteed interest strategy earn a fixed rate of interest that is credited daily, beginning on the segment’s start date. The interest rate is determined in advance and is guaranteed for the segment term.
Indexed: Segments using an indexed strategy earn interest or deduct losses based, in part, on the performance of the segment’s index over its term. For segment values held to maturity, credits or deductions are applied at the end of the segment term. Indexed strategies include participation rates, caps and floors. (see "Common Questions" below).
Protective Market Defender offers a variety of protection and growth options to help investors create a strategy that fits their retirement needs.
With the help of a financial professional, investors can create a sound plan to help limit the impact of major market downturns and capture upside returns.
Protective Life offers a wide variety of annuities to meet your needs. To learn more about available annuity options, call 1-800-833-8991.
The segment start date is the date the segment is established. Segments are generally established on the first and third Wednesday of each month.
The maturity date is the date a segment is scheduled to end.
The term is defined in the contract as the period of time from a segment’s start date through its maturity date, currently one year. A term will not necessarily correspond with calendar dates.
The participation rate is multiplied by index performance and is used to determine how much interest is credited to a segment value.
A cap is the maximum percentage of positive index performance that can be applied to a segment at the end of its term. The cap is declared in advance, prior to the segment’s start date.
A floor is the maximum percentage loss a segment can experience due to negative index performance, even if negative index performance exceeds that percentage. This protection level limits the impact of market downturns on indexed strategies because investors can select a floor (-5%, -10%, or -20%) that establishes the maximum percentage loss a segment can experience, even if negative index performance exceeds the selected floor. This is the level of protection for the segment.
With Protective Market Defender, you can have up to 100 existing segments in your contract.
The declared rate account is an interest bearing account that receives and holds purchase payments. It also receives and holds matured segment values that haven’t been reallocated. Amounts applied to this account will remain there until allocation instructions are executed.