Why it earned this rating
Our assessment
LunarGuard MVA 3-Year is a straightforward short-term MYGA from a carrier with a solid A rating. The rates are competitive for the 3-year band and the product does what it says. The MVA structure is the right tradeoff for buyers who can keep the money parked for three years, but it introduces a variable that plain-vanilla MYGAs without MVA do not have. The combination of a short surrender period and a market value adjustment puts this in solid — not top-tier — territory.
The short version
This is a 3-year guaranteed-rate annuity from AuguStar Life, issued through Constellation Insurance's independent channel. The rate locks at either 4.40% or 4.60% depending on whether you put in under or over $100,000, and it holds for the full three-year term. The catch is the MVA: if you surrender early and interest rates have risen since you bought in, your surrender value gets adjusted downward beyond the standard charge. If rates have fallen, the adjustment works in your favor. For someone who genuinely intends to hold for three years, the MVA is mostly irrelevant — the locked rate is the whole point.
Key facts
The full review
Is AuguStar LunarGuard MVA 3-Year a Good Annuity?
It depends on what you need. For someone with a genuine 3-year horizon who wants a locked rate and is comfortable with the MVA mechanics, this is a reasonable short-term accumulation vehicle from a financially sound carrier. For someone who might need the money sooner, the combination of a 9% first-year surrender charge plus a potentially unfavorable MVA creates a real risk. The product is honest about its tradeoffs — the question is whether they fit your situation.
Why Someone Would Buy This Annuity
The main reason to buy LunarGuard MVA 3-Year is rate certainty. You lock in a specific yield for three years with no cap, no participation rate, and no index to track — just a guaranteed fixed rate. The tiered structure rewards larger deposits with a higher rate, which makes sense for buyers putting in $100,000 or more. A secondary appeal is the short surrender window: three years is at the short end of MYGA durations, which matters for buyers who want protection from intermediate-term commitments but still want to beat CD-equivalent returns.
Who This Annuity Is Best For
I think LunarGuard MVA 3-Year is best for a saver who has already separated their long-term retirement money from their accessible emergency cash, has a specific 3-year parking need — an upcoming large expense several years out, a near-term income bridge, or a tax-deferral strategy — and understands what a market value adjustment means. The 18–92 issue-age range is notably wide, which makes it worth considering even for buyers closer to or past traditional retirement age. It is less appealing for anyone who might need to tap the account ahead of schedule or who dislikes variability in the early-exit cost.
What You're Really Buying Here
You are buying a contract that says: "Give us your money for three years, and we will credit you a fixed rate every year, guaranteed. If you leave early, you pay a surrender charge, and the MVA may push your effective cost up or down based on where interest rates are at the time." The fixed rate is the product's entire value proposition. There are no index strategies, no riders, and no bonus credits to evaluate. The simplicity is real, but so is the MVA layer on top of the standard surrender schedule.
How the Core Feature Works
LunarGuard MVA 3-Year credits a single fixed interest rate guaranteed for the full three-year surrender period. Rates at the time of the available brochure were 4.40% for deposits under $100,000 and 4.60% for deposits of $100,000 or more. The guaranteed minimum interest rate is 0.25%, which is the contractual floor if AuguStar were to reset rates at renewal — well below the current credited rate but the hard minimum the contract guarantees. Interest accumulates on a tax-deferred basis inside the contract.
The MVA — Market Value Adjustment — is the structural feature that sets this apart from a no-MVA MYGA. If you surrender during the 3-year period above the free-withdrawal amount, the carrier applies a formula that adjusts your surrender value based on how current interest rates compare to the rate environment when you bought the contract. Rising rates since purchase = negative adjustment (you get less). Falling rates since purchase = positive adjustment (you may get more). The standard surrender charges of 9%, 8%, and 7% apply in years 1 through 3 regardless of the MVA.
Why the Secondary Feature Matters
The free-withdrawal provision is the most relevant secondary feature. In year 1, you can pull out up to 5% of premiums paid without surrender charges or MVA. In years 2 and 3, you can withdraw up to 5% of account value penalty-free. For a pure accumulation MYGA, this is a meaningful safety valve — not enough to fund a major expense, but enough to cover modest liquidity needs that come up unexpectedly. It also means RMDs from a qualifying account can often be taken without triggering the full penalty, depending on your account size and required distribution amount.
Liquidity and Surrender Schedule
LunarGuard MVA 3-Year is a short-commitment product, but the surrender mechanics still deserve close attention because of the MVA layer.
| Contract Year | Surrender Charge |
|---|---|
| 1 | 9% |
| 2 | 8% |
| 3 | 7% |
| 4 | 0% |
The 9% first-year surrender charge is on the high end for a 3-year MYGA. Add a potentially unfavorable MVA on top of that in a rising-rate environment, and an early exit in year 1 can be materially costly. The free-withdrawal provision (5% of premiums in year 1, 5% of account value in years 2+) softens this for modest liquidity needs, but it does not eliminate the risk for anyone who needs to surrender a large portion of the contract early.
After year 3, all charges drop to zero. For buyers who hold to term, the surrender schedule is irrelevant.
Fees and Tradeoffs
There are no annual contract fees, no rider fees, and no asset-based charges on LunarGuard MVA 3-Year. The product earns money through the interest-rate spread, not through explicit fees. That is standard for MYGAs.
The real tradeoffs are structural. The MVA means that the cost of early surrender is not fully predictable at the time of purchase — it depends on where rates move. For buyers who are confident they will hold for three years, this matters very little. For buyers who have any realistic chance of needing the money before maturity, it matters quite a bit.
The surrender charges themselves are also on the steeper side for a 3-year product: 9% in year 1 and 7% even in year 3. Combined with the MVA, the early-exit risk is the main thing to evaluate before buying.
Product snapshot
| Feature | Details |
|---|---|
| Product Type | Fixed Annuity |
| Surrender Period | 3 years |
| Issue Ages | 18-92 |
| Minimum Premium | $10,000 |
| Crediting Methods | Fixed Rate |
| Free Withdrawal | 5% of account value annually (years 2+); 5% of premiums paid in year 1 |
| MGSV | 87.5% at 1-3% minimum guaranteed surrender value during surrender period |
| Death Benefit | Full account value passes to named beneficiary |
| Income Rider | Not available |
| Premium Bonus | None |
Carrier snapshot
Legal Entity: AuguStar Life Insurance Company
Parent: Constellation Insurance
A.M. Best Rating: A
Final take
LunarGuard MVA 3-Year is a clean short-term MYGA with a clear value proposition: a competitive locked rate, a modest minimum premium, and a 3-year commitment that fits shorter-horizon savers. The MVA is the deciding factor. If you understand it, are confident you will hold to maturity, and want simplicity without riders or index complexity, this product does what it promises.
If there is any realistic chance you will need to access more than the 5% free-withdrawal amount before year 3 ends, or if the unpredictability of the MVA bothers you, you would be better served by a no-MVA MYGA with a similar duration. The product is not wrong for the market — it is just important to go in with clear eyes about what happens if you leave early.