Income Pay Pro review

Yes, for the right buyer. It is a good annuity for someone who genuinely wants protected lifetime income, has a realistic deferral window of at least 5 years, and is comfortable with a 10-year commitment. It is not a good annuity for someone shopping primarily on accumulation, someone who may need the money before year 10, or someone who is not certain they will actually activate the income rider — paying 1.15% a year for a benefit you never use is one of the most common ways to make an FIA disappointing.

The main reason to buy Income Pay Pro is to create a future income floor that grows by 8% compounded annually for up to ten years, regardless of what the underlying indices do. That roll-up applies to the GLWB value, which becomes the base for lifetime payouts. The secondary reason is the multiplier features. If the contract earns positive index credits, those credits can lift the lifetime payout percentage. If the owner becomes confined to a nursing home (in most states), the lifetime payment can be doubled for a defined window. These are real, structural features — not marketing.

I think this product is best suited for someone in the 55-70 range who is rolling over a long-term qualified bucket (an IRA or 401(k) rollover) or repositioning non-qualified money they have already mentally committed to retirement. The buyer should expect to defer income for at least 5 years to get value out of the roll-up, and should have other liquid assets so the 10% free-withdrawal cap is not a problem. It is less appropriate for buyers under 50 (the roll-up will mostly time out before they need income), for buyers over 75 (the 10-year surrender is structurally hard to justify), or for buyers who treat the GLWB as optional — this rider is built-in and its fee is automatic, so a buyer who never plans to turn income on is paying for something they will never use.

You are not really buying an indexed growth product. You are buying a future lifetime income contract wrapped in an FIA chassis. The headline mechanic is the GLWB Rider VII. From day one, the contract maintains two separate values — the accumulation value, which moves with the chosen index strategies, and the GLWB value, which grows at a guaranteed 8% compounded rate each contract year for up to ten years (or until the first lifetime payment, whichever comes first). When the owner is ready to take income, the lifetime payment is calculated as a percentage of the GLWB value, with that percentage determined by the owner's age at activation. The accumulation value still belongs to the owner and still funds early payments, but the GLWB value is what backs the lifetime guarantee.

The GLWB roll-up is the engine. For up to ten contract years, the GLWB value grows by 8% compounded annually, regardless of index performance. After ten years, or after the first Lifetime Payment Amount is taken, the roll-up stops. At activation, the owner's age-banded payout percentage is applied to the GLWB value to set the Lifetime Payment Amount, which then continues for life even if the accumulation value is eventually depleted.

There are two notable enhancements layered on top of that base mechanic. The first is the index-credit multiplier — in contract years where the accumulation value earns positive index interest, the lifetime payout percentage can be increased. The second is the nursing home multiplier, which can double the lifetime payment for a defined period if the owner becomes confined to a qualifying facility (this feature is not approved in California and varies by state). The LPA reserve lets the owner defer unused annual income amounts forward, which gives the rider some flexibility for years when income is not needed.

In plain English, the rider is doing three jobs at once. It locks in a guaranteed growth rate on the income base. It gives the owner upside if the indices credit well. And it gives the contract a care-event lever that most income-FIAs do not have.

The crediting menu is the supporting story. Income Pay Pro offers seven index strategies — the S&P 500, a multi-asset risk-control variant of the S&P, two Barclays volatility-controlled indices, the Fidelity Multifactor Yield Index, the Goldman Sachs Equity TimeX Index, and the Morgan Stanley Dynamic Global Index — across five crediting methods including annual point-to-point with cap, annual point-to-point with participation, two-year point-to-point with participation, monthly point-to-point with cap, and a fixed account. That is a wider menu than most income-focused FIAs offer.

The reason this matters in an income-product context is the multiplier. Because positive index credits can boost the lifetime payout percentage, the crediting menu is not just decoration — it has a direct line to the rider math. The published rates as of July 2024 included cap rates between 5% and 10% and participation rates between 25% and 145% depending on strategy, with a fixed account at 2.50%. Those numbers are snapshots, not guarantees — any new buyer should ask for the live rate sheet before allocating.

This is a long-term contract. The owner gets 10% of beginning-of-year accumulation value as a penalty-free withdrawal starting in year one, which is more generous than many FIAs that delay free-withdrawal until year two. Beyond that 10%, withdrawals during the surrender period are hit by a charge that opens at 10% and steps down to 2% by year ten, plus an MVA — Market Value Adjustment, which means the penalty can move higher or lower depending on prevailing interest rates at the time of withdrawal.

Two liquidity provisions soften the schedule. First, once the rider is activated, the Lifetime Payment Amounts themselves are exempt from surrender charges and MVA, even after the accumulation value reaches zero. Second, the LPA reserve allows unused annual income to roll forward, so an owner who skips income one year does not forfeit it. RMDs from qualified contracts are generally accommodated within the free-withdrawal framework. Even with those provisions, this is not a contract to buy with money you might need before year ten.

The headline fee is the 1.15% annual rider charge on the GLWB value (maximum 2.00% under the contract). It deducts from the accumulation value, not the GLWB value, which means the income base keeps compounding at the 8% rate while the accumulation side pays the fee. That is the trade — the GLWB value is the asset getting the guaranteed growth, but the cash you actually have access to bears the cost.

That 1.15% is the right number to focus on, because it is paid every year regardless of whether the index strategies credit anything. In a flat or weak crediting year, the rider fee can be the larger force on the accumulation value than the index credits. The cap rates and participation rates printed in the latest rate sheet (effective July 9, 2024 per the brochure) sit in a mid-range zone — not the most aggressive in the category, not the worst. The base contract has no separate annual fee. There is no premium bonus on this product, so the GLWB roll-up has to do all the heavy lifting on selling the income story.