August 14, 2023No. 333-263041As filedFiled with the Securities and Exchange Commission on April 25, 2022
SECURITIES AND EXCHANGE COMMISSION
REGISTRATION STATEMENT
THE SECURITIES ACT OF 1933PRE-EFFECTIVE AMENDMENT NO. 1nameName of registrantRegistrant as specified in charter)41-0823832
Minneapolis, MN 55474
(800) 862-7919
RiverSource Life Insurance Company
50605 Ameriprise Financial Center
Minneapolis, Minnesota 55474
(612) 678-5337public:public: as soon as practicable after the effective date of the Registration Statement.☐registrantRegistrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrantRegistrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.
PART I.
INFORMATION REQUIRED IN PROSPECTUS
THE INFORMATION IN THE PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
April 29, 2022
is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This Prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.
Guarantee Period Accounts
Offered Under Certain Variable
Issued by: | RiverSource Life Insurance Company (RiverSource Life) |
829 Ameriprise Financial Center
Minneapolis, MN 55474
Telephone: 1-800-333-3437
(Service Center)
This prospectus describes Guarantee Period Accounts (GPAs), which are available only under the following variable annuity contracts:
70100 Ameriprise Financial Center Minneapolis, MN 55474 Telephone: 1-800-862-7919 (Service Center) RiverSource |
If you own one of these variableThe RiverSource Structured Solutions 2 annuity contracts, you may be able to allocateis a single purchase payments and contract value to the GPAs. The GPAs may not be available in some states and may not be available if you elect certain optional benefit riders available under your variable annuity contract. Please refer to your variablepayment deferred index-linked annuity contract or certificate (collectively, contract)(the Contract) issued by RiverSource Life. This prospectus contains important information that You should know before investing. All material terms and conditions of the prospectus for the contract (contract prospectus) for details regarding whether youContract, including material state variations, are eligible to investdescribed in the GPAs.
RiverSource Guarantee Period Accounts — Prospectus 1
this prospectus. Please read this prospectus carefullyit before investing and keep it for future reference.
If you withdraw money from the GPAsSurrender Charge) before the end of the guarantee period, you may be subjectSurrender Charge period. Investment in the Contract involves investment risks, including possible loss of principal and previous earnings on prior and current Segments. In addition to a surrender charge, a market value adjustment. Interest rates for new guaranteeadjustment will apply to all surrenders during the MVA period, accounts may be higher or lower thanincluding the previous guaranteed interest rate.
Total Free Amount.
The See “Segment Value Lock” for more information.
See “Risk Factors”.
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These
Annuitant:indicated meanings:
Annuity payouts: An amount paidAnnuitization Start Date.
Code:the Business Day We receive Your request.
Contract: One
determined.
Fixed account: An investment option that ispart of our general account, which guarantees a fixed interest rate. Unlike GPAs, allocations to the fixed account are not subject to a MVA.
any separate account(s) it may maintain.
Guarantee Period:
Guarantee Period Accounts (GPAs): A nonunitized separate accountnon-Business Day, even if the Index provider publishes a value on that Day.
annuitized and is not payable as a death benefit.
Owner (you, your): The person or persons identified in the contract as owner(s) of the contract, who has or have the right to control the contract (to decide on investment allocations, transfers, payout options, etc.). Usually, but not always, the owner is also the annuitant. The owner or any joint owner may
be a non-natural person (e.g. irrevocable trust or corporation) or a revocable trust. If any owner is a non-natural person or revocable trust, the annuitant will be deemed to be the owner for contractthis Contract. Any Contract provisions that are based on the age or lifeAge of the owner. WhenOwner will be based on the contract is owned by a revocable trust or irrevocable grantor trust, the annuitant selected should be the grantorAge of the trust to assure compliance with Section 72(s) of the Code.oldest Owner. Any ownership change, including continuation of the contract by yourYour spouse
the Segment will incur the
Service Center:
The Contract | The RiverSource Structured Solutions 2 annuity is a single flexible purchase payment deferred indexed-linked annuity contract with index-linked investment options. |
Buying the Contract | Purchase Payment |
Purchase payment limits are based on Your age on the effective date of the payment. The minimum purchase payment is $10,000 and the maximum total purchase payment per owner is $3,000,000 for ages up to 75 and $1,000,000 for ages 76 to 90. The maximum total purchase payment per Owner includes payments to all deferred annuity contracts issued by Us. | |
The purchase payment will be allocated based on Your initial elections as of the Contract Date. We reserve the right to limit in Our sole discretion how the purchase payment can be allocated among the available Indexed Accounts. | |
Issue Ages | |
You can buy a Contract if You are age 90 or younger. | |
Right to Examine and Cancel | |
You have the right to examine and cancel the Contract (without incurring a Surrender Charge or market value adjustment) within a certain number of days, which can vary by state, but is never less than ten days after You receive it. | |
If this is an IRA contract, upon such cancellation We will refund the purchase payment which You have paidless any partial surrenders You have made. The purchase payment returned will not be reduced for any surrender charges, market value adjustment, or fees. | |
If this is not an IRA contract, upon such cancellation We will refund an amount equal to the sum of: | |
•the Contract Value as of the Business Day We receive the returned Contract (except in states that require a return of purchase payment); and | |
•any premium tax charges paid. | |
Note for states where we return Contract Value: Amounts allocated to an Indexed Account will have the value based on the Segment Value calculation to determine the Contract Value. During the period of time You have to examine and cancel the Contract, Segment Values may be negatively impacted under this calculation. You bear the risk that the amount refunded may be significantly less than the purchase payment You have made. See “Valuing Your Investment - Indexed Account(s) Value” for more information. |
If you cancel this Contract under this provision, We reserve the right not to accept another application for this Contract for a period of six months. | |
In certain states, if this Contract is intended to replace an existing Contract, Your right to examine this Contract is extended to 30 Days. | |
For a state-by-state description of material variations of this Contract, including the right to examine and cancel period, see Appendix A: State Variations. | |
Investment Options | You may allocate Your purchase payment and Contract Value among the Indexed Accounts, each of which includes an Index(es), Crediting Method, protection option with a protection percentage, and duration. After the MVA period ends or after a spousal continuation, You can also allocate Contract Value to the Interim Account. In general, Caps, Contingent Returns, and Annualized Income Rates will be lower and Annual Fees will be higher if You choose an Indexed Account with a higher protection amount (i.e. Buffer). |
There are currently six categories of Indexed Accounts: |
Category | Durations | Protection Options | Number of Indexed Accounts |
Standard | |||
Dual Directional | |||
Annual Lock | |||
Contingent Return | |||
Income Choice | |||
Standard with Annual Fee | |||
Indexed Accounts will use the following Indexes | |
•S&P 500® Index; | |
•Russell 2000® Index; | |
•MSCI EAFE Index; | |
•MSCI Emerging Markets Index; | |
•NASDAQ-100® Index; or | |
•iShares U.S. Real Estate ETF | |
Many Indexed Accounts use one index to determine the Segment rate of return. However, there are several Indexed Accounts that calculate the Index rate of return for two indexes (i.e. S&P 500 and Russell 2000) and use the lesser of those Index returns to determine the Segment rate of return. For available Indexed Accounts, see table in the “Investment Options – Indexed Accounts”. The Indices used are price indices and do not reflect dividends paid on the underlying stocks. Each Index is described in more details under the section titled “Indexed Accounts – Additional Information about the Indexes”. | |
Over the course of Your Contract, We may add, discontinue or substitute an Index. For details, see “Investment Options: Discontinuation and Substitution of Indexes and Indexed Accounts.” |
Initial Rates and Rate Lock | You will receive the initial interest rates, Caps, Contingent Returns, Upside Participation Rates, Annualized Income Rates and Annual Fees in effect on the application date if the Contract is issued within the Rate Lock Period. Your ability to lock in the rates in effect on the application date only applies to the initial rates. Otherwise, interest rates, Caps, Contingent Returns, Upside Participation Rates, Annualized Income Rates and Annual Fees will be based on the rates in effect on the Contract Date. For recent rates available for new contracts, go to www.riversource.com/annuities/performance/ |
Renewal Rates | Renewal interest rates, Caps, Contingent Returns, Upside Participation Rates, Annualized Income Rates and Annual Fees are set at Our discretion, subject to contractual minimums and maximums and are different than the initial rates available for new contracts. Written notification of these rates will be sent to You at least 14 days before each Contract Anniversary. See “Investment Options - Indexed Accounts” for the contractual minimums and maximums. |
Renewal interest rates apply to any Contract Value in the Interim Account. As applicable, renewal Caps, Contingent Returns, Upside Participation Rates, Annualized Income Rates and Annual Fees apply to any Contract Value in the Segments that start on that Contract Anniversary. All renewal rates are determined based on Contract Date (even if rate lock applied for the initial rates). | |
Crediting Methods for the Indexed Accounts | Currently, the Contract offers Indexed Accounts with the following Crediting Methods. |
•Point-to-Point with a Buffer; | |
•Annual Lock with a Buffer; | |
•Contingent Return Point-to-Point with a Buffer; | |
•Contingent Return Point-to-Point with a Trigger; | |
•Income Choice Point-to-Point with a Buffer; | |
•Dual Directional Point-to-Point with a Buffer; | |
We reserve the right to stop offering certain Crediting Methods at the time of Segment renewal. We will notify You at least 14 days before each Contract Anniversary of the available Indexed Accounts and applicable Crediting Methods if You have Contract Value that can be transferred on that Contract Anniversary. | |
Each Crediting Method uses the following elements to calculate the Segment rate of return: | |
•The Index rate of return; | |
•The Upside Participation Rate (if applicable); | |
•The Cap (if applicable); | |
•The Contingent Return (if applicable); | |
•The Annual Fee (if applicable); | |
•The Annualized Income Rate (if applicable); | |
•The Buffer or Trigger. | |
Except for the Annual Lock with a Buffer crediting method, the Segment rate of return is based on a single point in time. | |
See “Crediting Methods” for more information. |
Segment Value | The Segment value will fluctuate daily and may increase or decrease from the initial amount allocated to the Segment (i.e. your Investment Base). We determine the Segment Value using a formula that does not directly reflect the actual performance of the applicable Index, but rather determines the value of a hypothetical portfolio of instruments (including derivatives and fixed assets) that provides the Segment Value at maturity. The value of the hypothetical portfolio, referred to as the proxy value, changes daily and therefore your Segment Value changes daily. Your Investment Base and the proxy value for the hypothetical portfolio are used to determine your Segment Value. |
You generally will not receive the full protection of the Buffer or Trigger prior to Segment maturity. It is possible that you would see no protection until Segment maturity. It is also possible that you would see no protection from the Trigger at Segment Maturity if the Index rate of return is negative and the loss exceeds the Trigger (i.e the Segment will incur the full Index loss). As a Segment moves closer to maturity, the Segment Value would generally reflect a larger portion of the Buffer protection. To the extent there is any protection from the Buffer or Trigger during a Segment, it is reflected in the proxy value. | |
On the Segment Maturity Date, the Segment Value is based on the Investment Base, the Index return and the applicable Crediting Method including any applicable Cap, Contingent Return, Upside Participation Rate, Annualized Income Rate, Annual Fee, Buffer or Trigger. Caps, Contingent Returns,and Annual Fees, if applicable, may limit any positive return for a Segment. | |
See “Valuing Your Investment - Indexed Account(s) Value” for more information. | |
Segment Value Lock | For Segments that allow an elective lock, You may request an elective lock of the Segment Value at any time during the Segment by notifying Us. |
If You decide to exercise the elective lock, Your Segment Value (which otherwise fluctuates daily) is “locked in” as of close business on the Segment Lock Date and will not change for the remainder of the Segment. However, Your locked-in value will be reduced by the dollar amount of any surrender You take from the Segment, including any applicable Surrender Charges, market value adjustments, and taxes. | |
For Segments that allow an automatic lock, at any time during a Segment You may set an Automatic Lock Target to automatically lock the Segment value. The Segment Lock Date is the first Business Day that (1) is on or after the Day You set an Automatic Lock Target and (2) the Segment return to date equals or exceeds the Automatic Lock Target. Before the Segment Lock Date, You can change the Automatic Lock Target or cancel Your request and remove the Automatic Lock Target. See “Indexed Account(s) Value - Segment Value Lock” for more information. |
Transfers | You may request a transfer once each Contract Year during a 30-day period ending on the Contract Anniversary (the “Transfer Window”). You may transfer any Contract Value in the Interim Account and any Segments that will mature on the next Contract Anniversary (excluding any amounts in the Interim Account for the automated transfer program) to any available Indexed Accounts. After the MVA period or after a spousal continuation, you may also request a transfer to the Interim Account. You may not request a transfer from any Segments that will not mature on the next Contract Anniversary. Keep in mind that We will send You a notice of renewal interest rates, Caps, Contingent Returns, Upside Participation Rates, Annualized Income Rates and Annual Fees at least 14 days before Your Contract Anniversary. You may want to wait until You receive this information before requesting a transfer. |
We may offer, at Our discretion, an optional automated transfer program. While You are enrolled in this program, before We process any other transfer instructions or automatic rebalancing on the Contract Anniversary, We will transfer the amount You request to the Interim Account according to any procedures that are then currently in effect. You may cancel this program at any time. If you cancel this program, any Contract Value in the Interim Account will remain in that account until the next Contract Anniversary. See “Optional Automated Transfer Program" for additional information. | |
Transfers will be effective as of the Contract Anniversary. If the last Day of the Transfer Window is not a Business Day, We must receive Your completed transfer instructions by the prior Business Day. You may request a transfer by Written Request or other method agreed to by Us. | |
See “Transfers” for more information. | |
Surrenders | You may surrender all or part of Your Contract Value at any time before the Annuitization Start Date. You also may establish automated partial surrenders. All surrenders, including those taken on a Segment Maturity Date, may be subject to Surrender Charges (if in excess of the Total Free Amount), a market value adjustment (during the MVA period) and income taxes (including an IRS penalty that may apply if You surrender prior to You reaching age 59 ½) and may have other tax consequences. |
Unless You tell Us otherwise, partial surrenders will be deducted from the Interim Account first. Any remaining amount will be deducted pro rata from all Indexed Accounts. You may specify the partial surrender is to be deducted from a specific Indexed Account(s). If an Indexed Account has multiple open Segments, the specified surrender will be deducted pro rata from all open Segments for that Indexed Account. | |
Each partial surrender must be at least $250. Your Contract Value after the partial surrender must be at least $500. | |
For a partial surrender request, We will determine the amount of Contract Value that needs to be surrendered, which after any Surrender Charge and any market value adjustment, will equal the amount You request. | |
Except on the Segment Maturity Date, the value of any Segment will be based on the Segment Value calculation (including the Investment Base and the proxy value). | |
If You take a partial surrender from a Segment, the Segment Value is reduced by the dollar amount of the surrender, including any applicable Surrender Charges, any market value adjustment and any applicable taxes. The Investment Base for each Segment will be reduced proportionally based on the percentage of Segment Value that is withdrawn. This means that if the Segment Value is higher than the Investment Base at the time of a partial surrender, then the Investment Base is reduced by an amount that is less than the dollar amount withdrawn. Conversely, if the Segment Value is lower than the Investment Base at the time of a partial surrender, then the Investment Base is reduced by an amount that is more than the dollar amount withdrawn. Whether the Segment Value will be higher or lower than the Investment Base is generally dependent upon the performance of the Index in addition to other factors. See “Valuing Your Investment – Indexed Account(s) Value” for more information. |
This mechanism allows the new Segment Value to reflect the current proxy value at all times during a Segment before the Segment Maturity Date. As an analogy, when a shareholder of a security sells shares of the security to obtain a given dollar amount of proceeds, the number of shares still owned by the shareholder following the sale will be more or less depending on how low or high the share price was at the time of sale. | |
See “Surrenders” and “Surrender Charges” for additional information about how surrenders affect Your Investment Base and Segment Values. See Appendix D for examples of the Investment Base adjustment. | |
Also, all partial surrenders (including Income Choice monthly income) will proportionally reduce any guaranteed death benefit based on the percentage of Contract Value that is withdrawn. | |
Surrender Charges | Surrenders may be subject to charges, a market value adjustment and income taxes (including a 10% IRS penalty that may apply if You surrender prior to You reaching age 59½) and may have other tax consequences. The amount of the Surrender Charge, if any, will depend on the Contract Year during which the surrender is taken. At the time of a partial surrender, if the Contract has a loss (i.e. Contract Value is less than the purchase payment not previously surrendered), the Surrender Charge will be greater, and therefore the amount of Contract Value that needs to be surrendered is greater, than if the Contract has a gain. |
The schedules below set forth the Surrender Charges under the Contract. | |
You select either a 6-year or 3-year Surrender Charge schedule at the time of application. |
Six-year schedule | Three-year schedule | ||
Contract Year* | Surrender Charge percentage applied to the purchase payment surrendered | Contract Year* | Surrender Charge percentage applied to the purchase payment surrendered |
1 | 9 % | 1 | 9 % |
2 | 8 | 2 | 8 |
3 | 8 | 3 | 8 |
4 | 7 | 4 + | 0 |
5 | 6 | ||
6 | 5 | ||
7 + | 0 |
Valuation date: Any normal businessyear is completed one day Monday through Friday, on which the NYSE is open, upprior to the time it closes. AtContract Anniversary.
Market Value Adjustment | A Market Value Adjustment (MVA) is a positive or negative adjustment that applies to surrenders (including the total free amount and required minimum distributions) or amounts applied to an Annuity Payment Plan during the MVA Period. The MVA period is equal to the surrender charge period that You select. An MVA will not apply to surrenders from the Interim Account or Income Choice monthly income. The MVA will either increase or decrease the surrender amount or the amount applied to Annuity Payments. See “Market Value Adjustments”. |
Death Benefit | If You die before the Annuitization Start Date, We will pay the death benefit to Your beneficiary. We offer Standard death Benefit at no additional charge and optional death benefits that you may elect for an additional charge. |
Standard Death Benefit. If You are age 80 or younger on the application date or the date of the most recent covered life change, the beneficiary receives the greatest of the following: | |
•The Contract Value, after any rider charges have been deducted; or | |
•The full surrender value; or | |
•The Return of Purchase Payment (ROPP) Value (See “Death Benefits - Standard Death Benefit”) | |
If You are age 81 or older on the application date or the date of the most recent covered life change, the beneficiary receives the greater of the following: | |
•The Contract Value, after any rider charges have been deducted; or | |
•The full surrender value | |
Optional Death Benefits. We offer two optional death benefits for an additional charge: | |
ROPP Death Benefit. If You are age 81 or older on the application date and elect the optional ROPP death benefit, the beneficiary receives the greatest of the following amounts: | |
•The Contract Value, after any rider charges have been deducted; | |
•The full surrender value; or | |
•The Return of Purchase Payment (ROPP) value. See “Optional Death Benefits – Return of Purchase Payment (ROPP) Death Benefit” | |
MAV Death Benefit. If You are age 79 or younger on the application date and elect the optional MAV death benefit, the beneficiary receives the greater of the following: | |
•The Contract Value, after any rider charges have been deducted; | |
•The full surrender value: or | |
•The MAV Value. See “Optional Death Benefits – Maximum Anniversary Value (MAV) Death Benefit”. | |
Death Benefit Charges | If You elect the optional ROPP Death Benefit at the time of purchase, you will be subject to an additional fee. The current annual fee is 0.55% of the ROPP Value on each Contract Anniversary. The annual fee is subject to the maximum fee of 0.95%. |
If You elect the optional MAV Death Benefit at the time of purchase, you will be subject to an additional fee. The current annual fee is 0.25%. Prior to Your 81st birthday the charge is calculated on Your Contract Anniversary by multiplying the annual rider fee by the greater of the MAV or the Contract Value. On or after Your 81st birthday the charge is calculated on Your Contract Anniversary by multiplying the annual rider fee by the MAV. The annual fee is subject to the maximum fee of 0.40%. | |
Each contract anniversary, the rider charge is deducted proportionally from all Segments and the interim account. The Investment Base for each Segment will also be reduced proportionally. For Segments that mature on that contract anniversary, the rider charge will reduce the amount that is available to renew into a new Segment. | |
Annuitizing Your Contract | You can apply Your Contract Value to any Annuity Payment plan on the Annuitization Start Date. You may choose from a variety of plans that can help meet Your retirement or other income needs. The payment schedule must meet IRS requirements. All Annuity Payments are made on a fixed basis. See “Annuity Payment Period – Annuity Payment Plans” for additional information. |
Termination of the Contract | The Contract will be terminated under the following conditions: |
•Payment of the death benefit will terminate the Contract. | |
•Reduction of the Contract Value to zero will terminate the Contract. | |
•Your Written Request for a full surrender will terminate the Contract. |
If we receive your purchase payment or any transaction request (such as a transfer or surrender request) in good order at our Service Center before the close of business, we will process your payment or transaction using the close of business values we calculate on the valuation date we received your payment or transaction request. On the other hand, if we receive your purchase payment or transaction request in good order at our Service Center at or after the close of business, we will process your payment or transaction using the close of business values we calculate on the next valuation date. If you make a transaction request by telephone (including by fax), you must have completed your transaction by the close of business in order for us to process it using the close of business values we calculate on that valuation date. If you were not able to complete your transaction before the close of business for any reason, including telephone service interruptions or delays due to high call volume, we will process your transaction using the close of business values we calculate on the next valuation date.
Variable account: Consists of separate subaccounts to which you may allocate purchase payments; each invests in shares of one fund.
4 RiverSource Guarantee Period Accounts — Prospectus
This section discusses risks associated with the GPAs. Please refer to your contract prospectus for information about risks associated with your contract and any optional benefit riders you have elected.
Interest Rate Risk
Each GPA pays an interest rate declared by us when you make an allocation to that account and is fixed for the guarantee period you choose. We will periodically change the declared interest rate for future allocations to these accounts at our discretion based, in part, on various factors on variousdiffer depending upon many factors, including but not limited to the way in which You allocate Your purchase payment and Contract Value over the course of the Contract and any decisions You make to take surrenders or request an elective or automatic lock.
Protection Option | Maximum Loss * |
-10% Buffer | 90 % |
-15% Buffer | 85 % |
-20% Buffer | 80 % |
-25% Buffer | 75 % |
-100% Buffer | 0 % |
-30% Trigger | 100 % |
Liquidity Risk
We guaranteeSegments by the contract value allocated todollar amount withdrawn.
Marketpercentage of Contract Value Adjustment Risk
We will apply an MVA to “early surrenders” from a GPA as described above. The MVAthat is withdrawn. This proportionate reduction may be negative, positivelarger than the dollar amount of the partial surrender.
Investment Risk
We guarantee the contract value allocated toyear;
Financial Strength
All guarantees under the GPAs are subject to the creditworthiness and continued claims-paying ability of RiverSource Life. We hold amounts you allocate to the GPAs in a “nonunitized” separate account. This separate account provides an additional measure of assurance that we will make full payment of amounts due under the GPAs. We own the assets of this separate account as well as any favorable investment performance of those assets. You do not participate in the performance of the assets held in this separate account. We guarantee all benefits relating to your value in the GPAs. The assets held in our general account support the guarantees under your contract including your investment in the GPAs. You should be aware that our general account is exposed to manynew Segment of the same risks normally associated withIndexed Account; and
Cybersecurity and Systems Integrity
contract year.
You should consider carefully the effect of partial surrenders prior to a Segment Maturity Date. For examples of how the Investment Base is impacted by a partial surrender, see Appendix D.
21
Six-year schedule | Three-year schedule | ||
Contract Year* | Surrender Charge percentage applied to purchase payment surrendered | Contract Year* | Surrender Charge percentage applied to purchase payment surrendered |
1 | 9 % | 1 | 9 % |
2 | 8 | 2 | 8 |
3 | 8 | 3 | 8 |
4 | 7 | 4 + | 0 |
5 | 6 | ||
6 | 5 | ||
7 + | 0 |
Number of Completed Years Since Annuitization | Surrender Charge percentage |
0 | Not applicable* |
1 | 5% |
2 | 4 |
3 | 3 |
4 | 2 |
5 | 1 |
6 and thereafter | 0 |
a × b | where: |
c |
a | = | the amount of the rider charge deducted from the Segment |
b | = | the Investment Base for the Segment on the date of the rider charge |
c | = | the value in the Segment on the date of (but prior to) the rider charge |
with an Annual Fee, there is a fee deducted from the Index rate of return after any Cap or Buffer is applied. The GPAsAnnual Fee is multiplied by the number of years in the Segment to determine the fee that is deducted on the Segment Maturity Date. For the current Annual Fees on Indexed Accounts available for new contracts, go to www.riversource.com/annuities/performance and for the maximum Annual Fee see "Investment Options - Indexed Accounts".
In general, you may allocate purchase payments and purchase payment credits, if applicable and transfer contract value to one or morevalidity of the GPAs with guarantee periods declaredchange.
through age 75 | $3,000,000 |
for ages 76 to 90 | $1,000,000 |
Category | Durations | Protection Options | Number of Indexed Accounts |
Standard | |||
Dual Directional | |||
Annual Lock | |||
Contingent Return | |||
Income Choice | |||
Standard with Annual Fee | |||
Min. Cap | Min. Upside Participation Rate | Min Contingent Return | Max. Annual Fee | |
Standard Indexed Accounts | ||||
[to be filed by pre-effective amendment] | ||||
Dual Directional Indexed Accounts | ||||
[to be filed by pre-effective amendment] | ||||
Annual Lock Indexed Accounts | ||||
[to be filed by pre-effective amendment] | ||||
Contingent Return Indexed Accounts | ||||
[to be filed by pre-effective amendment] | ||||
Income Choice Indexed Accounts | ||||
[to be filed by pre-effective amendment] | ||||
Standard with Annual Fee Indexed Accounts | ||||
[to be filed by pre-effective amendment] |
Each GPA pays an interest ratealternative index if We determine there is a reasonable substitute that is declared when you makecommercially viable. We will attempt to choose an allocationIndex that has a similar investment objective and risk profile as compared to that account. Interest is credited daily. That interestthe original Index. If We substitute an Index before the Segment Maturity Date, We will calculate the Index rate is then fixedof return for the guarantee period that you chose.full Segment using the replaced Index up until the replacement date and the new Index thereafter through the Segment Maturity Date. This will be accomplished by multiplying 1 plus the Index rate of return prior to the substitution by 1 plus the Index rate of return after the substitution, and then subtracting one. For example, if substitution of an Index for a three year Segment takes place at the end of the first year and the Index rate of return at the end of the first year is 10 percent, and the Index rate of return for the two years after the substitution is 20 percent, we would multiply 1.1 by 1.2 which results in 1.32. After subtracting one, this results in an Index rate of return of 32 percent. We will periodically change the declared interest rate for any future allocations to these accounts, but we will not change the Crediting Method, Buffer, or Trigger applicable to a Segment if We substitute the Index.
Scenario | Index Value on Segment Maturity Date | Index Rate of Return | Segment Rate of Return | Segment Value on Segment Maturity Date |
1 | 1100 | (1100/1000) - 1 = 10.00% | 6.00% | $106,000.00 |
2 | 1050 | (1050/1000) - 1 = 5.00% | 4.50% | $104,500.00 |
3 | 950 | (950/1000) - 1 = -5.00% | -1.00% | $99,000.00 |
4 | 850 | (850/1000) - 1 = -15.00% | -6.00% | $94,000.00 |
Year | Index Value on Prior Anniversary | Index Value on Current Anniversary | Index Rate of Return | Annual Lock Return | Annual Lock Value |
1 | 1000.00 | 1100.00 | (1100.00/1000.00) - 1 = 10.00% | 7.00% | $107,000.00 |
2 | 1100.00 | 1045.00 | (1045.00/1100.00) -1 = -5.00% | 0.00% | $107,000.00 |
3 | 1045.00 | 919.60 | (919.60/1045.00) - 1 = -12.00% | -2.00% | $104,860.00 |
Scenario | Index Value on Segment Maturity Date | Index Rate of Return | Segment Rate of Return | Segment Value on Segment Maturity Date |
1 | 1100 | (1100/1000) - 1 = 10.00% | 6.00% | $106,000 |
2 | 1030 | (1030/1000) - 1 = 3.00% | 6.00% | $106,000 |
3 | 950 | (950/1000) - 1 = -5.00% | 6.00% | $106,000 |
4 | 850 | (850/1000) - 1 = -15.00% | -5.00% | $95,000 |
Scenario | Index #1 Value on Segment Maturity Date | Index #1 Rate of Return | Index #2 Value on Segment Maturity Date | Index #2 Rate of Return | Segment Rate of Return | Segment Value on Segment Maturity Date |
1 | 1200 | (1200/1000) - 1 = 20.00% | 2200 | (2200/2000) - 1 = 10.00% | 6.00% | $106,000 |
2 | 1030 | (1030/1000) - 1 = 3.00% | 2030 | (2030/2000) - 1 = 1.50% | 6.00% | $106,000 |
Scenario | Index #1 Value on Segment Maturity Date | Index #1 Rate of Return | Index #2 Value on Segment Maturity Date | Index #2 Rate of Return | Segment Rate of Return | Segment Value on Segment Maturity Date |
3 | 950 | (950/1000) - 1 = -5.00% | 1950 | (1950/2000) - 1 = -2.50% | 6.00% | $106,000 |
4 | 850 | (850/1000) - 1 = -15.00% | 2100 | (2100/2000) - 1 = 5.00% | -5.00% | $95,000 |
Scenario | Index Value on Segment Maturity Date | Index Rate of Return | Segment Rate of Return | Segment Value on Segment Maturity Date |
1 | 1100 | (1100/1000) - 1 = 10.00% | 5.00% | $105,000 |
2 | 1030 | (1030/1000) - 1 = 3.00% | 5.00% | $105,000 |
3 | 850 | (850/1000) - 1 = -15.00% | 5.00% | $105,000 |
4 | 650 | (650/1000) - 1 = -35.00% | -35.00% | $65,000 |
spousal continuation or ownership change or if You choose to stop receiving Your Income Choice monthly
income, the payments will be redirected to the interim account for the remainder of the contract year. For any new Income Choice segments that start on the next contract anniversary, the Monthly Income will automatically be payable directly to You again.(a × b)/c | where: |
a | = | the Investment Base for the Segment on the date Monthly Income is payable |
b | = | the Annualized Income Rate |
c | = | 12 |
Scenario | Index Value on Segment Maturity Date | Index Rate of Return | Segment Rate of Return | Segment Value on Segment Maturity Date |
1 | 1100 | (1100/1000) - 1 = 10.00% | 0.00% | $100,000 |
2 | 950 | (950/1000) - 1 = -5.00% | 0.00% | $100,000 |
3 | 850 | (850/1000) - 1 = -15.00% | -5.00% | $95,000 |
Scenario | Index Value on Segment Maturity Date | Index Rate of Return | Segment Rate of Return | Segment Value on Segment Maturity Date |
1 | 1100 | (1100/1000) - 1 = 10.00% | 7.00% | $107,000.00 |
2 | 1050 | (1050/1000) - 1 = 5.00% | 5.50% | $105,500.00 |
3 | 950 | (950/1000) - 1 = -5.00% | 5.00% | $105,000.00 |
4 | 850 | (850/1000) - 1 = -15.00% | -5.00% | $95,000.00 |
We guarantee the contract value allocated to the GPAs, including interest credited, if you do not make any transfers or surrenders from the GPAs prior to 30least 14 days before each Contract Anniversary.
The 30-day rule does not apply and no MVA will apply to:
amounts surrendered under contract provisions that waive surrender charges for Hospital or Nursing Home Confinement and Terminal Illness Diagnosis; and
amounts deducted for contract fees and charges.
See “Charges” in your contract prospectus for information on the fees and charges that apply under your contract and the circumstances under which any applicable surrender charges will be waived.
Amounts we pay as death claimsInterim Account will not be reduced byless than the Guaranteed Minimum Interest Rate. Caps, Contingent Returns, Upside Participation Rates, and Annualized Income Rates will not be less than the Guaranteed Minimum Caps, Guaranteed Minimum Contingent Returns, Guaranteed Minimum Upside Participation Rates, and Guaranteed Minimum Annualized Income Rates, respectively, and Annual Fees will not exceed the Guaranteed Maximum Annual Fees.
AtContract Value in the EndInterim Account and any Segments that mature on the next Contract Anniversary (excluding any amounts in the Interim Account for the automated transfer program) to any available Indexed Accounts. After the MVA Period or after spousal continuation, You may also transfer to the Interim Account. You may not request a transfer from any Segments that will not mature on the next Contract Anniversary.
We will not apply an MVA to contract value you transfer or surrender out of the GPAs during the 30-day period ending onnext Contract Anniversary. If the last day of the guarantee period. During this 30 day window you may choose to startTransfer Window is not a new guarantee period ofBusiness Day, the same length, transfer the contract value from the current GPA to a GPA of another length, transfer the contract value from the current GPA to any of the investment options available under the contract, apply the contract value to an annuity payout plan, or surrender the value from the current GPA (all subject to applicable surrender, transfer, and annuitization provisions – See “Transferring Among Accounts”, “Surrenders” and “The Annuity Payout Period” in your contract prospectus for more information). If we do not receive any instructions by the end of your guarantee period, we will automatically transfer the contract value from the current GPA into the shortest GPA term available.
Calculating the MVA
When you request an early surrender, we adjust the early surrender amount by an MVA formula. The early surrender amount reflects the relationship between the guaranteed interest rate you are earning in your current GPA and the interest rate we are crediting on new GPAs that end at the same time as your current GPA.
The MVA is sensitive to changes in current interest rates. The magnitude of any applicable MVA will depend on our current schedule of guaranteed interest rates at the time of the surrender, the time remaining in your guarantee period and your guaranteed
6 RiverSource Guarantee Period Accounts — Prospectus
interest rate. The MVA is negative, zero or positive depending on how the guaranteed interest rate on your GPA compares to the interest rate of a new GPA for the same number of years as the guarantee period remaining on your GPA. This is summarized in the following table:
| ||||
| ||||
| ||||
If the MVA is negative, the early surrender amount willmust be decreased. If the MVA is positive, the early surrender amount will be increased. For the MVA formula and examples, see Appendix A.
Valuing Your Investment in the GPAs
We value the amounts you allocate to the GPAs directly in dollars. The value of the GPAs equals:
the sum of your purchase payments and transfer amounts allocated to the GPAs;
plus any purchase payment credits allocated to the GPAs, if applicable under your contract;
plus interest credited;
minus the sum of amounts surrendered (including any applicable surrender charges) and amounts transferred out;
minus applicable charges under your contract and the optional benefit riders you have elected.
See “Charges” in your contract prospectus for information on fees and charges that apply under your contract.
The “Nonunitized” Separate Account
We hold amounts you allocate to the GPAs in a “nonunitized” separate account. This separate account provides an additional measure of assurance that we will make full payment of amounts due under the GPAs. We own the assets of this separate account as well as any favorable investment performance of those assets. You do not participate in the performance of the assets held in this separate account. We guarantee all benefits relating to your value in the GPAs. This guarantee is based on the continued claims-paying ability of the company’s general account. You should be aware that our general account is exposed to the risks normally associated with a portfolio of fixed-income securities, including interest rate, option, liquidity and credit risk.
We intend to construct and manage the investment portfolio relating to the separate account in such a way as to minimize the impact of fluctuations in interest rates. We achieve thiscompleted by constructing a portfolio of assets with a price sensitivity to interest rate changes (i.e., price duration) that is similar to the price duration of the corresponding portfolio of liabilities.
We must invest this portfolio of assets in accordance with requirements established by applicable state laws regarding the nature and quality of investments that life insurance companies may make and the percentage of their assets that they may commit to any particular type of investment. Our investment strategy will incorporate the use of a variety of debt instruments having price durations tending to match the applicable guarantee periods. These instruments include, but are not necessarily limited to, the following:
Securities issued by the U.S. government or its agencies or instrumentalities, which issues may or may not be guaranteed by the U.S. government;
Debt securities that have an investment grade, at the time of purchase, within the four highest grades assigned by any of three nationally recognized rating agencies — Standard & Poor’s, Moody’s Investors Service or Fitch — or are rated in the two highest grades by the National Association of Insurance Commissioners;
Debt instruments that are unrated, but which are deemed by RiverSource Life to have an investment quality within the four highest grades;
Other debt instruments which are unrated or rated below investment grade, limited to 15% of assets at the time of purchase; and
Real estate mortgages, limited to 30% of portfolio assets at the time of acquisition.
In addition, options and futures contracts on fixed income securities will be used from time to time to achieve and maintain appropriate investment and liquidity characteristics on the overall asset portfolio.
While this information generally describes our investment strategy, we are not obligated to follow any particular strategy except as may be required by federal law and Minnesota and other state insurance laws.
RiverSource Guarantee Period Accounts — Prospectus 7
Transferring Contract Value To and From the GPAs
Before your contract value is applied to an annuity payout plan, you may transfer contract values from a GPA any time after 60 days of transfer or payment allocation to the account. Transfers made more than 30 days before the end of the guarantee period will receive an MVA, which may result in a gain or loss of contract value, unless an exception applies. You may not set up automated transfers to or from the GPAs.
The minimum transfer amount is $250 or the entire account balance, if less than $250. There is no charge for transfers. Before making a transfer, you should consider the risks involved in changing investments. We may suspend or modify transfer privileges at any time, subject to state regulatory requirements.
After your contract value is applied to an annuity payout plan, you may not make transfers to or from the GPAs. When your contract value is applied to an annuity payout plan, you must transfer all contract value out of the GPAs.
See “Transferring Among Accounts” in your contract prospectus for additional transfer provisions that apply to the investment options under your contract.
You may surrender all or part of your contract value in a GPA at any time before the date your contract value is applied to an annuity payout plan by sending us a written request or calling us. Surrenders from the GPAs will be subject to an MVA if done more than 30 days before the end of the guarantee period, unless an exception applies.
Surrender charges and other charges applicable to your contract and the optional benefit riders you have elected may apply. We do not apply MVAs to the amounts we deduct for fees and charges. See “Charges” in your contract prospectus for more information regarding charges that may apply under your contract. Federal income taxes and penalties and state and local income taxes may also apply. See “Taxes” in your contract prospectus for information about the tax consequences of surrendering contract value.
If you have a balance in more than one account and you request a partial surrender:
|
Under certain contracts, we will not surrender money from any GPAs you may have unless insufficient amounts are available from your other investment options or you specifically request the surrender is taken from the GPAs.
See “Surrenders” in your contract prospectus for more information regarding surrenders from your contract.
You may submit transfer or surrender requests in writing or by telephone.
To submit a transaction request by letter, send your name, contract number, Social Security Number or Taxpayer Identification Number and signed request to:
RiverSource Life Insurance Company
70100 Ameriprise Financial Center
Minneapolis, MN 55474
To submit a transaction request by telephone, call:
1-800-862-7919
If we receive your transfer or surrender request at our Service Center in good order before the close of the NYSE (4:00 pm Eastern time unless the NYSE closes earlier) on the prior Business Day. You may request a transfer by Written Request or other method agreed to by Us.
a × b | where: |
c |
a | = | the amount of the partial surrender deducted from the Segment |
b | = | the Investment Base for the Segment on the date of the surrender |
c | = | the value in the Segment on the date of (but prior to) the surrender |
Minimum amount | |
Surrenders: | $250* |
Maximum amount | |
Surrenders: | Contract Value |
Minimum amount: $50 | (we may waive the minimum amount for options 2 and 3 above) |
Maximum amount: None |
Minimum amount | |
Surrenders: | $250 |
Maximum amount | |
Surrenders: | $100,000 |
Please refer to your contract prospectus for more information regarding surrenders from your contract.
There are no charges that apply specificallyContract Date
8 RiverSource Guarantee Period Accounts — Prospectus
Your contract provides a standard death benefit, and additional optional death benefits may also be availableeach Segment.
Amounts we pay as death claims will not be subject to a negative MVA. However, a positive MVA may apply.
Under certain contracts and death benefits, theproxy value of the hypothetical fixed assets for that Segment.
Adjusted partial surrenders | = | a × b |
c |
a | = | the amount your contract value is reduced by the partial surrender. |
b | = | the applicable ROPP value or MAV value on the date of the partial surrender. |
c | = | the contract value on the date of (but prior to) the partial surrender. |
Under certain contracts, if the value of your death benefit is less than the dollar amount you would be entitledwithdrawn. Conversely, if the contract value is lower than the ROPP or MAV value at the time of a partial surrender, then the ROPP or MAV, value is reduced by an amount that is more than the dollar amount withdrawn.
market value adjustment.
Annuitizing Amounts in the GPAs
MVAs may apply when your contract value is applied to an annuity payout plan. This is because GPAs are not offered after your contract value is applied to an annuity payout plan, and you must transfer all contract value out of the GPAs on that date.
When your contract value is applied to an annuity payout plan, your contract value, including any contract value allocated to the GPAs, will be annuitized (converted to a stream of monthly payments). If your contract is annuitized,spouse who continues the contract goes into payout and onlyis age 80 or younger, we set the annuity payout provisions continue. You will no longer have accessROPP value to your contract value.
The annuity payout plans available to you are outlined in your contract prospectus. The amount available to purchase payouts under the plan you select is the contract value on the date your contract value is applied toof the plancontinuation after any applicablerider charges have been deducted plusand after any increase to the contract value due to the death benefit that would otherwise have been paid.
#1 Down Market Example: | |||||
Contract Value (before the partial surrender): | $85,000.00 | ||||
Purchase payment minus adjusted partial surrenders: | |||||
Total purchase payment: | $100,000.00 | ||||
minus adjusted partial surrenders, calculated as: | |||||
$5,000 × $100,000 | = | –5,882.35 | |||
$85,000 | |||||
for a ROPP death benefit of: | $94,117.65 | ||||
The full surrender value (after the partial surrender): | $80,000.00 | ||||
The Death Benefit is greatest of Contract Value (after the partial surrender), full surrender value and ROPP: | $94,117.65 | ||||
#2 Up Market Example: | |||||
Contract Value (before the partial surrender): | $110,000.00 | ||||
Purchase payment minus adjusted partial surrenders: | |||||
Total purchase payment: | $100,000.00 |
minus adjusted partial surrenders, calculated as: | |||||
$5,000 × $100,000 | = | –4,545.45 | |||
$110,000 | |||||
for a ROPP death benefit of: | $95,454.54 | ||||
The full surrender value (after the partial surrender): | $100,000.00 | ||||
The Death Benefit is greatest of Contract Value (after the partial surrender), full surrender value, and ROPP: | $105,000.00 |
allocated proportionately between the original and new contracts. However, per IRS Revenue Procedure 2011-38, if surrenders are taken from either contract within the 180-day period following a partial 1035 exchange, the IRS will apply general tax principles to determine the appropriate tax treatment of the exchange and subsequent surrender. As a result, there may be unexpected tax consequences. You should consult Your tax advisor before taking any surrender from either contract during the 180-day period following a partial exchange.
The
About The Interim Account that We make available under the Service Providers
For additional distribution information, please see your contract prospectus. ThereContract is no additional plansupported by the General Account.
separate account. All investment income, gains, and losses (whether or not the gains and losses are realized) from assets allocated to the separate account are borne by Us. The obligations under the contract are independent of the investment performance of the separate account and are the obligations of Us.
Additional information aboutand other businesses We conduct.
RiverSource Guarantee Period Accounts — Prospectus 9
information applies regardless of whether you choose to invest in the GPAs, and there is no additional plan of distribution or sales compensation with respect to the GPAs.
We issueselling firm.
We conduct a conventional life insurance business. We are licensed to do business in 49 states,compensation that each will receive if You buy the District of Columbia and American Samoa. Our primary products currently include fixed and variable annuity contracts (including indexed linked annuity contracts) and life insurance policies.
Insurance companies have been the subject of increasing regulatory, legislative and judicial scrutiny. Numerous state and federal regulatory agencies have commenced examinations and other inquiries of insurance companies regarding sales and marketing practices (including sales to older consumers and disclosure practices), claims handling, and unclaimed property and escheatment practices and procedures.
RiverSource Life(the Company) is involved in the normal course of business in a number of other legal proceedings which include regulatory inquiries, arbitration and arbitration proceedingslitigation, including class actions, concerning matters arising in connection with the conduct of its activities. These include proceedings specific to the Company as well as proceedings generally applicable to business activities. RiverSource Life believes thatpractices in the industries in which it is not a partyoperates. The Company can also be subject to nor are anylegal proceedings arising out of its properties the subject of, any pending legal, arbitration or regulatory investigation, examination or proceeding that is likely to have a material adverse effect ongeneral business activities, such as its consolidated financial condition, results of operations or liquidity. Notwithstanding the foregoing, it is possible that the outcome of any current or future legal, arbitration or regulatory proceeding could have a material impact on results of operations in any particular reporting period as the proceedings are resolved.
investments, contracts, and employment relationships. Uncertain economic conditions, heightened and sustained volatility in the financial markets and significant financial reform legislation may increase the likelihood that clients and other persons or regulators may present or threaten legal claims or that regulators increase the scope or frequency of examinations of RiverSource Lifethe Company or the insurance industry generally.
10 RiverSource Guarantee Period Accounts — Prospectus
Insofar
RiverSource Guarantee Period Accounts — Prospectus 11
Appendix A: Example — Market Value Adjustment (MVA)
AsDerivatives will be adjusted for the examples below demonstrate,potential transaction costs of exiting derivative positions before the application of an MVASegment Maturity Date. This adjustment may result in either a gainlower Segment Value and helps protect us from the trading risks that may arise when exiting derivative positions.
1 | *Rate Adjustment |
(1 + Initial Value)M |
Initial Value | = | A value calculated so Your Segment Value on the Segment start date, prior to any adjustment for transaction costs made to the Hypothetical Value of Derivatives, will be equal to Your Investment Base. The Initial Value will not change during the Segment. |
M | = | The number of full and partial years remaining in Your Segment |
Rate Adjustment | = | An estimate of the change in fixed asset values that has occurred since the later of the start of Your Segment and the first anniversary on or after the MVA ends. |
( | 1 +Reference Rate as of the Rate Adjustment Start Date | ) | Rate Adjustment Tenor |
1 +Reference Rate as of the valuation date |
(Annual Fee) x (Segment duration) | Where: |
(1 + r)M |
Segment Duration | = | The initial length of the Segment in years |
r | = | A risk-free interest rate based on the Segment Maturity Date |
M | = | The number of full and partial years remaining in Your Segment |
Assumptions:
You purchase a contract and allocate part of your purchase payment to a ten-year GPA; and
we guarantee an interest rate of 3.0% annually for your ten-year Guarantee Period; and
after three years, you decide to make a surrender from your GPA. In other words, there are seven years left in your guarantee period.
Remember that the MVA depends partly on the interest rate of a new GPA for the same number of years as the Guarantee Period remaining on your GPA. In this case, that is seven years.
Example 1: Remember that your GPA is earning 3.0%. Assume at the time of your surrender new GPAs that we offer withthe partial surrenders and another where the Segment has a seven-year Guarantee Period are earning 3.5%. We add 0.10% to the 3.5% rate to get 3.6%. Your GPA’s 3.0% rate is less than the 3.6% rate so the MVA will be negative.
Example 2: Remember again that your GPA is earning 3.0%, and assume that new GPAs that we offer with a seven-year Guarantee Period are earning 2.5%. We add 0.10% to the 2.5% rate to get 2.6%. In this example, since your GPA’s 3.0% rate is greater than the 2.6% rate, the MVA will be positive. To determine that adjustment precisely, you will have to use the formula described below.
Sample MVA Calculations
The precise MVA formula we apply is as follows:
Early surrender amount × [{( 1 + i )/(1 + j + .001)}(n/12) –1] = MVA
Where i = rate earned in the GPA from which amounts are being transferred or surrendered.
j = current rate for a new Guaranteed Period equal to the remaining term in the current Guarantee Period (rounded up to the next year).
n = number of months remaining in the current Guarantee Period (rounded up to the next month).
Examples — MVA
Using assumptions similar to those we used in the examples above:
You purchase a contract and allocate part of your purchase payment to a ten-year GPA; and
we guarantee an interest rate of 3.0% annually for your ten-year Guarantee Period; and
after three years, you decide to make a $1,000 surrender from your GPA. In other words, there are seven years left in your guarantee period.
Example 1: You request an early surrender of $1,000 from your ten-year GPA earning a guaranteed interest rate of 3.0%. Assumegain at the time of your surrender new GPAs that we offer with a seven-year Guarantee Period are earning 3.5%. Using the formula above, we determinepartial surrenders.
$1,000 × [{( 1.030 )/(1 + .035 + .001)}(84/12) –1] = -$39.84
In this example,Segment Value is reduced by the MVA is a negative $39.84.
Example 2: You request an early surrender of $1,000 from your ten-year GPA earning a guaranteed interest rate of 3.0%. Assume at the time of your surrender new GPAs that we offer with a seven-year Guarantee Period are earning 2.5%. Using the formula above, we determine the MVA as follows:
$1,000 × [{( 1.030 )/(1 + .025 + .001)}(84/12) –1] = $27.61
In this example, the MVA is a positive $27.61
12 RiverSource Guarantee Period Accounts — Prospectus
Please note that, depending on the surrender charge schedule applicable to any purchase payments you allocate to a GPA, a surrender charge may also apply. We do not apply MVAs to the amounts we deduct for surrender charges, so we would deduct any applicable surrender charge from your early surrender after we applied the MVA. Also note that when you request an early surrender, we surrender andollar amount from your GPA that will give you the net amount you requested after we apply the MVA and any applicable surrender charge, unless you request otherwise.
The current interest rate we offer on the GPA will change periodically at our discretion. It is the rate we are then paying on purchase payments, renewals and transfers paid under your class of contract for guarantee period durations equaling the remaining guarantee period of the GPA to which the formula is being applied.
RiverSource Guarantee Period Accounts — Prospectus 13
Appendix B: Example — Death Benefit Calculations
The purpose of this appendix is to illustrate the impact of the MVA on the Return of Purchase Payment death benefit.
In order to demonstrate these death benefit calculations, an example may show hypothetical contract values. These contract values do not represent past or future performance. Actual contract values may be more or less than those shown and will depend on a number of factors, including but not limited to the investment experience of the variable account, the fixed account, the GPAs,partial surrender and the fees and charges that apply to your contract.
Example #1 –For contracts that include the full surrender value in the death benefit calculation:
Assumptions:
Contract Value = $99,000
Surrender Charge = $2,000
Market Value Adjustment = $5,000
No rider charges
Return of Purchase Payment Death Benefit = $100,000
Full surrender Value = Contract Value – Surrender Charge + Market Value Adjustment = $99,000 – $2,000 + $5,000 = $102,000
Death Benefit = Greater of Contract Value, Return of Purchase Payment Death Benefit, and full surrender value = $102,000
Example #2 - For contracts where partial surrenders have a proportional adjustment to the death benefit:
Assumptions (before the partial surrender):
Contract Value = $50,000
Return of Purchase Payment Death Benefit = $55,000
Net Partial Surrender requested = $5,000
MVA Amount = -$500
Surrender Charge = $0
Amount withdrawn from Contract Value = $5,500
Remaining Contract Value = $44,500
Adjusted Partial Surrenders = $55,000* $5,500 / $50,000 = $6,050
Adjusted Return of Purchase Payment Death Benefit = $55,000 - $6,050 = $48,950
Death Benefit = Greater of Contract Value and Return of Purchase Payment Death Benefit = $48,950
* Under certain death benefits, the value of the death benefit isInvestment Base will be reduced proportionally when you take a partial surrender. If you request a partial surrender from the GPAs that will give you the net amount you requested after we apply any applicable MVA and surrender charge, the MVA could increase or decrease the percentage of contract value that is withdrawn. In these circumstances, a negative MVA would increase the impact of an adjusted partial withdrawal (which is based on the percentage of contractSegment Value that is withdrawn. If at the time of the partial surrender the Segment Value is less than the Investment Base, the Investment Base will be reduced by an amount greater than the dollar amount of the partial surrender. If at the time of surrender the Segment Value is greater than the Investment Base, the Investment Base will be reduced by an amount less than the dollar amount of the partial surrender. The reduced Investment Base will impact all future daily Segment Values including the Segment Value on the Segment Maturity Date.
1.Investment Base prior to the Surrender | $100,000.00 |
2.Proxy Value | 80.00% |
3.Segment Value prior to the Surrender ($100,000 × 80%) | $80,000.00 |
4.Amount of Partial Surrender | $20,000.00 |
5.The Investment Base is reduced by 25%, the same proportion as the Segment Value that is withdrawn ($20,000/$80,000 × $100,000) | $25,000.00 |
6.Investment Base after the Surrender ($100,000 – $25,000) | $75,000.00 |
7.The Segment Value after the Surrender equals the new Investment Base multiplied by the Proxy Value ($75,000 × 80%). Note that this resulting value equals the Segment Value prior to the Surrender less the Amount of the Partial Surrender ($80,000 – $20,000). | $60,000.00 |
8. Investment Base prior to the Surrender | $75,000.00 |
9. Proxy Value | 70.00% |
10.Segment Value prior to the Surrender ($75,000 × 70%) | $52,500.00 |
11.Amount of Partial Surrender | $5,250.00 |
12.The Investment Base is reduced by 10%, the same proportion as the Segment Value that is withdrawn ($5,250/$52,500 × $75,000) | $7,500.00 |
13.Investment Base after the Surrender ($75,000 – $7,500) | $67,500.00 |
14.The Segment Value after the Surrender equals the new Investment Base multiplied by the Proxy Value ($67,500 × 70%). Note that this resulting value equals the Segment Value prior to the Surrender less the Amount of the Partial Surrender ($52,500 – $5,250). | $47,250.00 |
15.Segment Rate of Return at Maturity | 0.00% |
16.The Segment Value at Maturity equals the new Investment Base multiplied by (1 + Segment Rate of Return) ($67,500 × (1 + 0%)) | $67,500.00 |
1.Investment Base prior to the Surrender | $100,000.00 |
2.the Proxy Value | 105.00% |
3.Segment Value prior to the Surrender ($100,000 × 105%) | $105,000.00 |
4.Amount of Partial Surrender | $10,500.00 |
5.The Investment Base is reduced by 10%, the same proportion as the Segment Value that is withdrawn ($10,500/$105,000 × $100,000) | $10,000.00 |
6.Investment Base after the Surrender ($100,000 – $10,000) | $90,000.00 |
7.The Segment Value after the Surrender equals the new Investment Base multiplied by the Proxy Value ($90,000 × 105%). Note that this resulting value equals the Segment Value prior to the Surrender less the Amount of the Partial Surrender ($105,000 – $10,500). | $94,500.00 |
8. Investment Base prior to the Surrender | $90,000.00 |
9. the Proxy Value | 110.00% |
10.Segment Value prior to the Surrender ($90,000 × 110%) | $99,000.00 |
11.Amount of Partial Surrender | $19,800.00 |
12.The Investment Base is reduced by 20%, the same proportion as the Segment Value that is withdrawn ($19,800/$99,000 × $90,000) | $18,000.00 |
13.Investment Base after the Surrender ($90,000 – $18,000) | $72,000.00 |
14.The Segment Value after the Surrender equals the new Investment Base multiplied by the lesser of the Proxy Value ($72,000 × 110%). Note that this resulting value equals the Segment Value prior to the Surrender less the Amount of the Partial Surrender ($99,000 – $19,800). | $79,200.00 |
15.Segment Rate of Return at Maturity | 0.00% |
16.The Segment Value at Maturity equals the new Investment Base multiplied by (1 + Segment Rate of Return) ($72,000 × (1 + 0%)) | $72,000.00 |
PleaseLSE Group companies.
14of Bloomberg and Barclays and not for the benefit of the owners of the annuity products, investors or other third parties. In addition, the licensing agreement between RiverSource Guarantee Period Accounts Life and Bloomberg is solely for the benefit of RiverSource Life and Bloomberg and not for the benefit of the owners of the annuity products, investors or other third parties.
©2008-2021 RiverSource Life Insurance Company. All rights reserved.
PRO9115_12_A01_(4/22)
Registration Fee: | $ | 0 | ||
Printing and Filing Expenses: | $ | 4,900 | * | |
Legal Fees and Expenses: | N/A | |||
Audit Fees: | $ | 4000 | * | |
Accounting Fees and Expenses: | N/A |
Registration Fee: |
$661,200 |
Printing and Filing Expenses: | $ ____* |
Legal Fees and Expenses: | N/A |
Audit Fees: | $____* |
Accounting Fees and Expenses: | N/A |
of Directors and Officers
See the Exhibit Index immediately preceding the signature page to this registration statement for a list of exhibits filed as part of this registration statement, which Exhibit Index is incorporated herein by reference.
Exhibit No. | Description |
1. | |
2.1 | |
2.2 | |
3.1 |
3.2 | |
3.3 | |
3.4 | |
3.5 | |
4.1 | |
4.2 | |
4.3 | |
4.4 | |
4.5 | |
4.6 | |
4.7 | |
4.8 | |
4.9 | |
4.10 | |
4.11 | |
4.12 | |
5. | |
23. | Consent of Independent Registered Public Accounting Firm will be filed by amendment. |
24. | |
Ex-107 |
Item 17. Undertakings
c)
EXHIBIT INDEX
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant, RiverSource Life Insurance Company, certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of Minneapolis, and State of Minnesota on the 25th14th day of April, 2022.
RiverSource Life Insurance Company | |||
(Registrant) | |||
By | |||
/s/ Gumer C. | |||
Gumer C. Alvero | |||
Chairman of the Board |
Pursuant to the requirements of
Signature | Title | |
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/s/ Gumer C. | Chairman of the Board and President (Chief Executive Officer) | |
Gumer C. Alvero | ||
/s/ Michael J. | Senior Vice President – Corporate Tax | |
Michael J. Pelzel | ||
/s/ Stephen P. | Director, Senior Vice President and Chief Actuary | |
Stephen P. Blaske | ||
/s/ Shweta | Senior Vice President and Treasurer | |
Shweta Jhanji | ||
/s/ Brian E. | Chief Financial Officer (Chief Financial Officer) | |
Brian E. Hartert | ||
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/s/ Gene R. | Director | |
Gene R. Tannuzzo | ||
/s/ Gregg L. Ewing | Vice President and Controller (Principal Accounting Officer) | |
Gregg L. Ewing | ||
/s/ Stephen R. Wolfrath | Director, Vice President – Insurance and Annuities Product Development and Management | |
Stephen R. Wolfrath | ||
/s/ John R. Hutt | Director | |
John R. Hutt |
Signed pursuant to Power of Attorney to sign Amendment to this Registration Statement, dated Aug. 1, 2023, filed electronically herewith, by:
Exhibit Index
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