Americo Financial Life and Annuity Review

The Future Provider Series from Americo is a fixed indexed annuity that features two accounts in one contract: a fixed account and an indexed account. While the former grows based on a fixed interest rate, the latter earns returns based on the performance of a market index. You’re free to allocate as much of your money to each account as you want.

Americo offers five indexes that you can choose from: four from the S&P 500 and one from the NASDAQ-100. In addition to this, the company offers a 5% bonus on your first premium payment, a benefit that vests immediately.

In its standard form, the Future Provider Series annuity comes with a death benefit that pays your beneficiaries an amount equal to your contract’s value at the time of your death. However, you can change your death benefit with Americo’s Death Benefit Payout rider. There are two options for this rider:

• Death Benefit Payout Option 1: This will spread your beneficiary’s payments out over 25 years based on the designated rate at the time of your death. As of the time of this writing, this rate stands at 150% of your contract’s value.
• Death Benefit Payout Option 2: If you’d prefer a shorter payment schedule, this option allows your to divide payments over 15 years. The payout rate for this is a bit lower, though, at 130%.

In order to open this contract, you must have at least $10,000 ready to invest with Americo. The maximum age that this contract is issued at is 85 years old.

Fees

There are no annual fees associated with the Future Provider Series annuity. There are withdrawal charges, though, if you withdraw more than 10% of your account value in any year after your first year of ownership. Should you surpass this allotted amount, you’ll be subject to the following fees:

In the event that you withdraw from your contract before age 59.5, the IRS will charge you a 10% income surtax. That’s in addition to any standard income taxes on your withdrawal income.

Realistic Return Expectations

Between the five indexes that Americo makes available for investment with the Future Provider Series annuity, participation rates vary wildly. These rates indicate what percentage of the associated index’s performance you’ll be credited with. For example, if you have a 60% participation rate and that index grows by 10%, your account will earn 6%. The interest rate associated with the fixed portion of this contract will be assigned to you at issue.

The Ultimate One Index Series of fixed indexed annuities comes in two iterations: Ultimate One Index 9 and Ultimate One Index 9 Bonus. Americo requires a $10,000 minimum initial premium for each of these contracts. As for the maximum issue age, it depends on which version you’re looking to open. For the standard version, the issue age is capped at 85 years old, while the bonus version requires you to be 80 years old or younger.

The main difference between these contracts is that the Ultimate One Index 9 Bonus annuity comes with a 5% premium bonus that vests immediately. Otherwise, each of these contracts works like any other fixed indexed annuity. That means annuitants get both a fixed account and an indexed account that they can split their funds between. For the indexed account, you can choose one of four S&P 500 indexes that your money will follow the performance of. 

Like the Future Provider Series annuity, the base death benefit for this annuity pays your beneficiaries the value of your contract at the time of your death. However, there are no death benefit riders to alter this feature.

Fees

This annuity has no annual fees. That doesn’t mean that there aren’t any charges to be mindful of, though. Should you withdraw more than 10% of your annuity’s value in any ownership year after your first, you’ll incur a withdrawal fee. For the Ultimate One Index 9 annuity, they range from 5% to 11%:

The Ultimate One Index 9 Bonus annuity abides by this slightly different schedule:

Because annuities are considered to be retirement accounts, anyone who withdraws from their annuity before age 59.5 will encounter a 10% income tax penalty in addition to normal income taxes.

Realistic Return Expectations

There are four S&P indexes available for investment with this annuity. Like the Future Provider Series annuity, the participation rates and rate caps for each are different. A participation rate indicates what percentage of an index's performance you'll be credited with at the end of the year. On the other hand, a rate cap places a limit on the earnings that you could receive from an index. Here's an example of how each of these work:

• Rate Cap
  • If your rate cap is 5%, and the S&P index earns 8%, you only receive 5%.
  • If your rate cap is 5%, and the S&P index earns 3%, you receive 3%.
• Participation Rate
  • If your participation rate is 50%, and the S&P index earns 10%, you receive 5%.
  • If your participation rate is 35%, and the S&P index earns 7%, you receive 2.45%.

Lastly, you'll receive your fixed interest rate from Americo at contract issue.

Platinum Assure 5 is a multi-year guaranteed annuity, or MYGA, that locks you in at a fixed interest rate for five years. Once that five-year period ends, you can either sign up for another term or you can take your money and move it somewhere else. There are no fees associated with the latter choice, as Americo offers a “true walk-away” policy on this contract.

Of the four Americo annuities in this review, the Platinum Assure 5 contract carries the highest maximum issue age at 90 years old. As for the minimum initial premium, that stands at $10,000.

Fees

While you won’t be on the hook for any annual fees with Platinum Assure 5 contract, it does have withdrawal charges. However, these only apply if you withdraw more than 10% of your contract value in any year after your first.

A 10% income tax penalty applies to most annuity withdrawals if you complete one prior to turning 59.5 years old. Regular income tax rates apply, too.

Realistic Return Expectations

As an MYGA, the Platinum Assure 5 annuity comes with a 2.70% fixed interest rate, according to Blueprint Income (Feb. 2021). This rate is guaranteed for a five-year period.

As a deferred income contract, the Platinum Provider annuity allows you and any joint annuitants to receive income payments for life. There are two requirements you must satisfy to qualify for this guarantee:

• Income payments must begin before age 85
• Must wait at least two years to start payments

There are two payout options for this contract. The first and most basic is “Life Income Only,” which means you and your joint annuitants will keep receiving income payments until you die.

The second choice is “Life Income with Death Benefit,” which introduces a death payout for your beneficiaries. If you go this route, the aforementioned payout will be equal to your single premium payment, minus all the income payments you received. In other words, if you outlive your premium, your beneficiaries won’t get anything following your death.

The maximum issue age for this annuity is 80 years old. However, the minimum initial premium requirement works a little different than most other annuities. Rather than provide a single flat amount you must reach, Americo allows you to invest the greater of either $10,000 or a premium that facilitates at least the minimum income payment of $50.

Fees

There are no annual or contract fees for the Platinum Provider annuity.

As with all annuities, if you make a withdrawal before turning 59.5 years old, a 10% penalty will apply in addition to your normal income tax rate.

Realistic Return Expectations

The Platinum Provider deferred income annuity is not built to help you earn returns. Instead, it guarantees income for the rest of the annuitant's (or joint annuitants’) lives.