NAC Guarantee Plus 5-Year review

Yes, for the right buyer. This is a good MYGA for someone who wants a guaranteed rate over five years, doesn't need the money, and wants the simplicity of a fixed annuity without rider costs. It's less attractive for someone who might need liquidity before the end of the term, is focused on generating guaranteed lifetime income, or wants upside potential beyond the locked rate.

The main reason to buy NAC Guarantee Plus 5-Year is the certainty of a known rate for a defined period, backed by a carrier with an A+ A.M. Best rating. For buyers moving money out of a maturing CD, a bond ladder, or another short-term fixed account, a MYGA at these rates offers meaningful tax deferral on top of a competitive yield. The two-tier rate structure also gives buyers with $100,000 or more a clear incentive — the 25-basis-point step-up at the high band is worth paying attention to.

I think this product is best for someone in their mid-50s to mid-70s who has a defined five-year time horizon for a portion of their fixed-income allocation and wants to lock in a rate rather than roll short-term instruments repeatedly. It fits both qualified money (IRAs, rollovers) and non-qualified taxable savings. The broad 0-90 issue age range makes it accessible to older buyers who often face restrictions with other carriers. It is least suited to someone who hasn't covered near-term expenses with liquid assets, since pulling money out early carries both surrender charges and potential MVA exposure.

When you buy NAC Guarantee Plus 5-Year, you are buying a promise: North American will credit a specified interest rate to your contract value for five years, guaranteed not to change. There is no index, no floor, no cap — just a fixed rate. Your principal is protected from market loss, and all growth is tax-deferred until withdrawn. At the end of five years, the contract reaches the end of its surrender period and you can access the full value without penalty, renew, or begin systematic withdrawals. What you're giving up in exchange is access to that money — surrenders during the five-year window trigger both a declining charge and a Market Value Adjustment that can move in either direction based on prevailing interest rates at the time of surrender.

NAC Guarantee Plus 5-Year credits a fixed interest rate to the contract value at a rate that is set at issue and guaranteed for the entire five-year surrender period. As of the brochure materials, the declared rate is 4.90% for contracts below $100,000 and 5.15% for contracts of $100,000 or more — but these are current rates, not permanent contractual guarantees on future contracts, so the actual rate on a new contract will depend on the rate in effect at the time of purchase.

The rate is credited annually to the accumulation value. Interest compounds inside the contract, and the entire accumulation — principal plus credited interest — grows on a tax-deferred basis until distributions begin. There are no strategy choices, allocation decisions, or crediting method elections. The simplicity is the point.

The nursing home confinement waiver is the most practically meaningful secondary feature on this contract. After the first contract year, if the annuitant is confined to a qualified nursing care facility, up to 100% of the accumulation value can be withdrawn without surrender charge or MVA. That provision is available at no additional charge and applies in most states (not South Dakota). For the target buyer — typically someone in or approaching retirement — the ability to access contract funds if a long-term care event occurs provides real liquidity relief that the base surrender terms don't offer. It doesn't replace a long-term care policy, but it does meaningfully soften the liquidity constraint for one of the most common scenarios that forces early annuity liquidation.

You're trading five years of unrestricted access for a locked rate. The contract allows free withdrawal of interest earned in the prior contract year starting in year two. By current company practice, interest earned in year one may also be accessed penalty-free, though this is a practice rather than a contractual guarantee. Amounts beyond the free-withdrawal provision during the surrender period are subject to the schedule below and to the MVA — a Market Value Adjustment that fluctuates with interest rates. In a rising rate environment, the MVA can add to your surrender cost. In a falling rate environment, it can reduce it. Either way, it is an additional variable that buyers need to understand before committing funds they may need before year five.

The surrender schedule starts at 9% in year one — steeper than some 5-year MYGA competitors. If you're comparing, look at the full table before assuming "5-year surrender" means the same cost structure across products. The nursing home waiver provides a meaningful exception, and the free-withdrawal provision gives some annual access, but this is not a liquid instrument.

There are no base contract fees, no rider fees, and no spread charges — the declared rate is what you get credited. That's a straightforward cost structure. The tradeoffs are structural rather than fee-based. First, the MVA introduces uncertainty into the early-exit cost that a simple surrender charge alone wouldn't. Second, the rate is fixed — if rates rise significantly during your five-year window, you cannot participate in higher yields. Third, there is no income rider available on this product, so if lifetime income becomes a priority, this product doesn't solve for that need.

Legal Entity: North American Company for Life and Health Insurance

Parent: Sammons Financial Group

A.M. Best Rating: A+