Hewitt EnnisKnupp Sample Annuity Pricing Rates February 28, 2014

Hewitt EnnisKnupp Sample Annuity Pricing Rates
February 28, 2014
Immediate Annuity Rates
Low
High
3.11%
3.41%
3.12%
3.42%
3.36%
3.66%
3.22%
3.52%
3.09%
3.39%
3.17%
3.47%
3.29%
3.59%
3.15%
3.45%
3.11%
3.41%
2.66%
2.96%
2.32%
2.62%
2.48%
2.78%
2.56%
2.75%
Rates as of:
2/28/2014
1/31/2014
12/31/2013
11/30/2013
10/31/2013
9/30/2013
8/31/2013
7/31/2013
6/30/2013
5/31/2013
4/30/2013
3/31/2013
2/28/2013
Deferred Annuity Rates
Low
High
3.79%
4.17%
3.86%
4.24%
4.11%
4.49%
4.02%
4.40%
3.82%
4.20%
3.88%
4.26%
3.97%
4.35%
3.89%
4.27%
3.78%
4.16%
3.34%
3.72%
2.95%
3.33%
3.12%
3.50%
3.23%
3.61%
Note: Pricing interest rates can vary for many reasons. For estimate purposes, the low end of the range should be the
starting point for cases that have complex plan provisions, contain data that has not been scrubbed, have cash
balance and/or employee contributions, etc. Extra conservatism for such circumstances should possibly be added to
lower the estimated rate even further. Deferred annuity rates should be applied to the full lifespan of deferred
participants. There is no need to adjust the rate post-retirement.
Historical Sample Annuity Pricing Rates
7.0%
Deferred Rate (Duration=15)
Immediate Rate (Duration=7)
6.0%
30-Year Treasury Rate
10-Year Treasury Rate
Interest Rate
5.0%
4.0%
3.0%
2.0%
Mar-14
Dec-13
Jun-13
Sep-13
Mar-13
Dec-12
Jun-12
Sep-12
Mar-12
Dec-11
Jun-11
Sep-11
Mar-11
Dec-10
Jun-10
Sep-10
Mar-10
Dec-09
Jun-09
Sep-09
Mar-09
Dec-08
Jun-08
Sep-08
Mar-08
Dec-07
Jun-07
Sep-07
Mar-07
1.0%
Note: Rates are derived from an HEK survey completed by ten insurance companies currently active in the
marketplace. (Data since 3/31/2013 excludes two companies currently on bidding hiatus.) The rates since 2011 are
derived from the highest (most aggressive) interest rates available in the marketplace on plain vanilla cases as of the
last working day of the calendar month. Since rates vary so much intraday, quotes are generally only held open for a
couple of hours on the day they are published.
Institutional Annuities and Life Insurance Solutions Team
Steve Shepherd | [email protected] | 203.523.8164
Jay Dinunzio | [email protected] | 203.523.8831
Jennifer Lawrence | [email protected] | 610.834.2271