Smart Saver 5-Year (NY) review

Yes, for a narrow audience. If you are a New York resident who wants a guaranteed fixed rate for five years with no market exposure and no rider overhead, this is a good product from a well-rated carrier. If you are outside New York, it is not available to you. If you want income guarantees or index-linked upside, this is not the right product — it does none of those things by design.

The straightforward reason: you want to know exactly what rate you will earn for five years, you do not need the money until the surrender period ends, and you want the tax-deferred status of an annuity rather than a bank CD. Protective's A+ A.M. Best rating adds carrier confidence. The Return of Premium feature — included at no charge — means you can surrender the contract and receive at least your original premium back even if surrender charges would otherwise apply, which adds a meaningful safety layer for risk-averse buyers.

Smart Saver NY is best for a conservative New York-based saver, likely within 5-10 years of retirement, who has $25,000 or more to allocate to a fixed-rate instrument and does not anticipate needing that money during the five-year window. It works in qualified and non-qualified accounts, and it fits buyers rolling over an IRA or 401(k) balance who want a simple, predictable alternative to money market funds or short-duration bond funds. The Nursing Home and Unemployment surrender charge waivers add some practical flexibility for buyers who are uncertain about future health or employment situations.

You are buying a fixed-rate insurance contract that guarantees a specific annual interest rate for five years. The insurance company holds your premium, credits interest at the agreed rate, and returns your accumulation value at maturity or on surrenders. Unlike a CD, the gains grow tax-deferred until withdrawal. Unlike a fixed indexed annuity, there is no index-linked upside — the rate is set at issue and does not change with market conditions. The simplicity is the point. There are no moving parts, no allocation decisions to make, and no annual recalculations based on index performance.

The product uses rate banding: the guaranteed annual rate you earn for all five years depends on your initial premium. Below $50,000 you earn 4.05%. At $50,000 you earn 4.30%. At $100,000 or more you earn 4.55%. These rates are current as of March 31, 2026 — they are contractually locked once your contract is issued, but the initial rate offered to new buyers changes over time. The five-year guarantee means there is no annual reset risk: whatever rate you lock in at issue is what you earn through maturity. That predictability is the product's main structural advantage over indexed or variable alternatives.

The Return of Premium feature deserves more attention than it usually gets on basic MYGAs. It is included automatically at issue at no charge. What it means in practice is that if you ever need to surrender the contract during the five-year period, Protective guarantees you will receive at least the sum of your original premiums back — even if the surrender charge would otherwise reduce your value below that amount. This is a meaningful backstop for someone who commits a large sum but has some lingering uncertainty about accessing principal in an emergency. It does not make this a liquid product, but it does reduce the risk that you could lose principal outright on an early exit.

Smart Saver NY allows you to take up to 10% of account value as a free withdrawal immediately — meaning from day one of the contract, not after the first anniversary. That is a more generous starting point than many MYGAs, which typically require waiting until year two. Amounts above 10% are subject to the surrender charge schedule: 9% in year one, declining by 1% per year to 5% in year five.

There is no Market Value Adjustment on this product, which is a clean simplification. Surrender charges are the only cost of early exit. Additionally, nursing home confinement and unemployment qualify for surrender charge waivers, providing real-life relief provisions. Required minimum distributions are accommodated as well — an important consideration for IRA holders who need to satisfy annual RMD obligations without triggering penalties.

There are no base contract fees and no rider fees. The annuity earns its return entirely from the spread Protective keeps between what it earns on its invested assets and what it credits to your account. You see only the net rate. The tradeoff is straightforward: you give up liquidity for five years in exchange for a locked rate. The surrender charges are the mechanism that enforces that commitment — they are not arbitrary; they reflect the cost Protective bears if it has to unwind the underlying investments early.

The main rate tradeoff is the banding structure. At $25,000 the rate is 4.05%, which is meaningfully lower than the 4.55% available at $100,000 or more. If you are comparing this product at the entry minimum against other NY-eligible MYGAs, make sure you are comparing at the same premium band.

Legal Entity: Protective Life and Annuity Insurance Company

Parent: Protective Life Insurance Corporation

A.M. Best Rating: A+