Axa has today released the adaptation of its North platform offering people a product that addresses longevity risk.
The Protected Retirement guarantee was flagged back in October last year and is now being rolled out to advisers through a series of roadshow presentations around the nation.
The offering provides investors with a guaranteed income stream for the rest of their life, determined by the amount of the original capital investment.
The amount of income to be paid will be determined at what age the individual decides to enter the product, with 60 year-olds to receive a 4 per cent income stream and people 65 and over to receive an income of 5 per cent of the investment balance.
The minimum age of entry for the product is 50 years.
The underlying investment remains in the market for its duration. Four investment strategies will be available with varying degrees of exposure to growth assets, those being allocations of 35 per cent, 50 per cent, 70 per cent and 85 per cent.
“The Protected Retirement guarantee has got the flexibility of allocated pensions but with the security of a guaranteed income,” Axa general manager sales and marketing Adrian Emery said.
The guaranteed income base is revised on an annual basis with any capital growth locked in at the higher level. The income stream will continue to be paid even if the underlying capital base is eroded to zero.
The rollout of the Protected Retirement guarantee is part of a greater initiative Axa is undertaking in order to give advisers a wider range of tools to deal with longevity risk.
To this end, Axa has included on the North website a calculator to help people determine how long their super will last.
By putting in information regarding retirement age, estimated super balance at retirement, the retirement income required, and the asset allocation to growth assets, individuals and advisers can get an indication of when those particular retirement savings might run out.
