Premier Plus Variable Annuity II review

It depends on what you want from it. As a tax-deferred market-accumulation vehicle from a top-rated carrier, with a meaningful upfront bonus and optional death-benefit protection, it is a reasonable choice for the right buyer. But it is not a good annuity for anyone who thinks "annuity" means "safe" — the subaccounts carry full market risk, and the fees are high enough that you need real long-term market growth to come out ahead of a lower-cost alternative.

The main reason to buy Premier Plus Variable Annuity II is tax-deferred growth on a diversified market portfolio you do not have to manage for taxes year to year, packaged with a premium bonus that boosts your starting balance. The secondary reason is the optional guarantees: an enhanced death benefit that can lock in your highest anniversary value for heirs, or an income rider that converts the account into a protected lifetime stream later. In practice, this is the product someone buys when they have already maxed out other tax-advantaged accounts, want more market participation than an indexed annuity allows, and value New York Life's balance-sheet strength behind the guarantees.

I think this annuity is best for a buyer in the accumulation years who is comfortable with market risk, wants tax deferral beyond what an IRA or 401(k) provides, and is funding at a level that reaches the higher bonus tiers — 3.00% kicks in at $100,000 and 4.00% at $500,000. It fits someone who plans to leave the money in for the full surrender period or longer, and who wants the death-benefit or income guarantees enough to pay for them. It is a poor fit for anyone who wants principal protection, anyone fee-sensitive who would be better served by a low-cost brokerage account or an indexed annuity, or anyone who might need the money before the 8-year surrender schedule burns off.

You are not buying a guaranteed rate, and you are not buying principal protection. You are buying a basket of mutual-fund-like investment subaccounts — 88 of them here, plus one fixed-account option — inside an insurance contract that defers taxes on the growth. The "variable" in variable annuity means exactly what it says: your account value goes up and down with the markets you choose, and it can lose money. What the insurance company sells you on top of that is optional protection — a death benefit for your heirs, or a living benefit that guarantees income — and the contract charges you annual fees for the wrapper and for each guarantee you elect. Strip away the brochure language and you are buying tax-deferred market investing with optional insurance riders attached.

The core of this contract is the subaccount menu. You allocate your premium across the available investment options, and your account value tracks the performance of whatever you pick, net of fees. New York Life reports a net subaccount fee range of roughly 0.28% to 1.34%, which is the underlying fund expense layered on top of the contract's own charges. There is also a fixed-account option and dollar-cost-averaging accounts (a six-month DCA Plus with elevated rates) if you want to ease money into the market over time rather than all at once.

Layered on top is the premium bonus, which is what separates this from the plain Premier Variable Annuity II. New York Life adds a tiered bonus to your initial premium: 2.75% on $5,000 to $99,999, 3.00% on $100,000 to $499,999, and 4.00% on $500,000 and up. That bonus increases your starting account value, but as with most bonus annuities, you should assume it is funded by the higher ongoing charges and the longer surrender schedule — the bonus is not free money, it is a structure tradeoff.

The most meaningful secondary features are the optional riders, because they change what the product is. The death-benefit option here is the Annual Death Benefit Reset II, which can lock in the highest contract anniversary value as a floor for your heirs and step it up over time — useful if legacy protection is part of why you are buying. Separately, an Investment Preservation Rider 5.0 and related living-benefit options can guarantee a future income base that rolls up to 130% of premiums paid (150% on the 20-year version) over a defined waiting period.

The key point is that neither of these is built in. They are optional and they cost extra — the death benefit runs 0.25% to 1.00% a year and the income rider 0.50% to 0.70% depending on the waiting period. So the contract can be a fairly lean accumulation wrapper or a guarantee-heavy income-and-legacy plan, depending on what you elect, and the fee you pay scales accordingly.

This is an 8-year commitment. The surrender charge starts at 8% in years one and two, then steps down — 7%, 6%, 5%, 4%, 3%, 2% — before reaching 0% in year nine. A market value adjustment also applies, which means the surrender cost on amounts above the free allowance can move up or down with interest rates, adding another variable to early exits. Pulling money out beyond the free amount during this window can cost real principal.

The free-withdrawal terms are reasonable for the category. For owners ages 0 to 75, you can take the greater of 10% of premiums paid, your earnings, or 10% of account value each year (a slightly different basis in year one versus later years). For older owners ages 76 to 80, the free allowance jumps to 50%, which is generous. The contract is RMD-friendly, so required minimum distributions are accommodated, and penalty-free withdrawal waivers are available for nursing home confinement, terminal illness, disability, and unemployment. Even so, treat this as long-term money — the surrender schedule and MVA make it a poor place to park cash you might need soon.

The fee stack is the central tradeoff, and there are several layers. The base mortality and expense (M&E) charge is 1.50%, assessed daily against the subaccounts (the materials note it is charged at 1.60% quarterly against adjusted premiums paid in the bonus structure). On top of that sit the underlying subaccount fees of roughly 0.28% to 1.34%, a $30 annual contract fee, and — if you elect them — rider fees of 0.50% to 1.00% for the income and death-benefit options. Add it up and an investor electing guarantees can easily be paying well north of 2% a year all-in before any investment return.

Name the trade plainly: you are paying for tax deferral, a top-rated insurer's guarantees, and an upfront bonus, but you are paying it out of market returns that are not guaranteed. In a strong, long bull market the tax deferral and bonus can outweigh the drag; in a flat or down market, the fees compound against you. Whether the riders are worth it depends entirely on whether you actually use them — the income rider only pays off if you turn income on, and the death benefit only pays off if the guarantee exceeds your account value when you die.

Legal Entity: New York Life Insurance and Annuity Corporation

Parent: New York Life Insurance Company

A.M. Best Rating: A++

Premier Plus Variable Annuity II is issued by New York Life Insurance and Annuity Corporation, a subsidiary of New York Life Insurance Company. New York Life carries an A++ rating from A.M. Best, the highest financial-strength grade available, which matters more for a variable annuity than people often assume — the carrier's strength stands behind every optional living-benefit and death-benefit guarantee, even though it does not back the subaccount investments themselves.