MultiRate 3-Year review

It depends on what you are comparing it against. If you are shopping 3-year MYGAs, this is not one — it is a 7-year surrender product with a 3-year rate guarantee. If you are shopping 7-year fixed annuities and want a fee-free structure, no MVA, and an A+ carrier, it is a reasonable choice. The 10% annual free withdrawal from day one and the chronic illness and terminal illness waivers add real flexibility. What it is not is a competitive 7-year locked rate; the 3.85% base rate reflects a 3-year guarantee, not a true 7-year yield. I think buyers in the 7-year category can generally do better on rate by shopping carriers that actually commit to 7 years of guaranteed yield.

The main reason to choose MultiRate 3-Year is the Western & Southern brand and financial strength. An A+ A.M. Best rating puts them in a small group of the most highly rated annuity issuers in the country, and for buyers who prioritize carrier security above rate optimization, that matters. The secondary reason is the no-MVA structure — you know exactly what your surrender charge will be at any point in the contract, without wondering whether rising interest rates have added an invisible layer of cost. The chronic illness waiver is also a genuine benefit that many comparable products do not include at no extra charge.

I think this product is best for a conservative buyer — likely 55 to 75 — who prioritizes carrier quality over rate maximization, has no need to access principal during the 7-year window except through the 10% annual free withdrawal, and is willing to accept a 3-year rate renewal cycle rather than a single locked yield for the full surrender period. It fits qualified money (IRA, 401(k) rollover) or non-qualified savings that you genuinely will not need. It is a poor fit for anyone who needs liquidity beyond 10% annually, anyone who assumes the 3-year name signals a 3-year commitment, or anyone shopping primarily on rate competitiveness.

You are buying a guaranteed interest contract from a financially strong insurer. The contract will credit a fixed rate to your account — no index participation, no caps, no participation rates — just a declared rate that is set at issue and locked for the guarantee period. The insurer earns the spread between what it invests your premium in and what it credits to you. There is no market value adjustment on this product, which means surrender charges are exactly what the schedule says and nothing more. The trade you are making is liquidity — specifically, 7 years of limited access — in exchange for a guaranteed return and insurer credit quality.

The guaranteed interest structure works as follows: at contract issue, you receive a first-year interest rate enhancement of 2.00% applied on top of the base declared rate. Based on the April 2026 rate sheet, that produces a credited rate of 5.85% in year one (3.85% base plus the 2.00% enhancement). After the first contract year, the enhancement expires and the credited rate drops to 3.85% for years two and three of the initial guarantee period. At the end of three years, the guarantee period renews at whatever rate Western & Southern is then declaring. You are not locked into 3.85% for the life of the contract — but you are also not guaranteed anything above 3.85% after year one.

The 5.85% first-year figure is the marketing number. The structural yield for a buyer who holds the full 7-year surrender period without any early withdrawals will be materially lower than 5.85%. That does not make the product dishonest, but it does make the headline number misleading if taken at face value.

The most meaningful secondary feature is the absence of a market value adjustment. Many fixed annuities and MYGAs include an MVA provision that adjusts your surrender value up or down based on the direction of interest rates at the time you withdraw. When rates rise after you purchase, the MVA can add a meaningful penalty on top of the stated surrender charge. Western & Southern has removed that variable from this product entirely. The surrender charge schedule is the full cost of early withdrawal — no surprises. For buyers who are uncertain about the future rate environment, that transparency has real value.

The chronic illness waiver (Additional Waiver of Surrender Charges Rider) is the other notable secondary feature. If you become confined to a long-term care facility or hospital for 30 or more days, surrender charges are waived. Terminal illness waiver (12-month life expectancy) is also available in most states. These are meaningful protections that turn a rigid 7-year commitment into something with genuine safety valves.

The free-withdrawal provision is straightforward and available from the first contract year — 10% of contract value annually, noncumulative, with a $250 minimum per withdrawal. That means you cannot roll unused percentages forward; if you take nothing in year one, you cannot take 20% in year two without a charge. Systematic withdrawal programs are also available for up to 10% annually or interest-only distributions.

Anything beyond the 10% free amount is subject to the surrender schedule. There is no MVA on this product, so the charge is exactly what the table shows.

The waivers provide real relief in specific situations. Annuitization with level payments over five or more years, initiated at least two years after contract issue, also avoids surrender charges. Required minimum distributions from qualified contracts are generally accommodated within the free-withdrawal provision or with carrier cooperation — the spec indicates this product is RMD-friendly.

What this product is not is liquid. A 7-year surrender schedule on a "3-Year" named product will catch buyers off guard if they have not read the contract carefully. Anyone with a meaningful chance of needing the principal within 7 years should look at a true short-term MYGA or a CD instead.

This is a genuinely fee-free product in the traditional sense. There is no base contract fee, no rider fee, and no asset-based annual charge of any kind. The only cost structure is the interest-rate spread Western & Southern earns as the insurer, which is built into the credited rate rather than itemized separately — the same as any other fixed annuity or CD.

The tradeoffs are structural, not fee-based. The 7-year surrender schedule is the price you pay for the guaranteed rate and carrier quality. The base rate of 3.85% for a 3-year guarantee is unlikely to lead the market against true multi-year guarantors that lock rates for 5 or 7 years at a time. And the first-year rate enhancement, while real, is a one-time boost that makes the product look more competitive in year one than it actually is over the full holding period.

Legal Entity: Western-Southern Life Assurance Company

Parent: Western & Southern Financial Group

A.M. Best Rating: A+

Western & Southern Financial Group is one of a small number of major annuity carriers that holds an A+ rating from A.M. Best. For buyers who weight insurer financial strength heavily — particularly those putting qualified money to work or funding a significant portion of retirement savings — that rating matters. The company has been in the insurance business for over a century, and the financial strength is genuine rather than aspirational.