Retirement Income Journal
The information forum of the decumulation industry.

The innovative “dual account” deferred variable annuity, which several insurers have recently brought to market in various forms over the past year, is a bit unusual. It combines two investment sleeves in one all-purpose tax-deferred accumulation/income product. 

 The first sleeve, like any plain vanilla variable annuity, holds mutual fund-like sub-accounts and has no living benefit riders attached to it. Policyholders can also transfer money to a second sleeve whose assets are held in a more limited selection of sub-accounts with the benefit of guaranteed lifetime income.  

 The contract owners thus have two accounts side by side: a low-fee investment account for growth and an account for guaranteed lifetime income. As their need for liquidity and growth declines during retirement, owners can gradually re-allocate assets from the first account to the second, building their future income stream layer by layer and reducing the overall risk of the portfolio.   

So far, the two available versions of these products are the Personal Retirement Manager (PRM), issued by The Hartford, and Retirement Cornerstone from Axa Equitable. (Allianz Life has a dual account product, Retirement Pro, on file with the SEC.)