May 14, 2021
VIA E-MAIL
Darin Smith, Esq.
Vice President and Associate General Counsel
Equitable Financial Life Insurance Company
1290 Avenue of the Americas
New York, NY 10104
Re: Separate Account No. 49 of Equitable Financial
Life Insurance Company
Initial Registration Statement on Form N-4
File Nos. 333-254385; 811-07659
Equitable Financial Life Insurance Company
Initial Registration Statement on Form S-3
File No. 333-254384
Dear Mr. Smith:
On March 17, 2021 you filed the above-referenced initial
registration statements on Form
N-4 and Form S-3 on behalf of Equitable Financial Life Insurance
Company (the Company )
and its separate account. Based on the Company s
representations in the letters accompanying
the registration statements, we have given the registration
statements a selective review. Where
a comment is made with regard to the disclosure in one location,
it is applicable to all similar
disclosure appearing elsewhere in the registration statements.1
General
1. Please confirm that all missing information, including
all exhibits, will be filed in a pre-
effective amendment to each registration statement. We
may have further comments
when you supply the omitted information.
2. The Contract offers one variable investment option,
which invests in shares of the
EQ/Money Market Portfolio of the EQ Advisors Trust. To
avoid investor confusion,
please revise the disclosure throughout the prospectus
to remove references to one or
more Portfolios or to one or more variable investment
options. Please also remove
1
Capitalized terms have the same meaning as in the registration
statements unless otherwise indicated. Page
numbering refers to the Form N-4 registration statement unless
otherwise indicated.
Darin Smith, Esq.
May 14, 2021
Page 2 of 11
Portfolio disclosure that is not relevant to the Contract, such as
the disclosure relating to
the Asset Transfer Program.
3. The Company allows contract owners to pay third-party advisory fees
under a Series
ADV contract through a withdrawal of account value. Given the
potentially significant
reduction in account value that could occur as a result of ongoing
withdrawals from
Segments prior to the Segment Maturity Date, particularly with
respect to the
proportionate reduction in the Segment Investment resulting from the
Segment Interim
Value calculation, as well as the proportionate reduction in the
death benefit and the
potential tax consequences of such withdrawals, please explain
supplementally the
Company s basis for determining that such deductions are suitable
for Series ADV
contract owners.
4. Please confirm supplementally that the rates and assumptions
reflected in the examples
throughout the prospectus are reasonable in light of current and
anticipated market
conditions.
5. Please add the word Appendix to all appendix cross-references,
or utilize some other
method for clarifying such cross-references (e.g., it is not clear
that see Segment
Maturity Value means the appendix titled Segment Maturity Value
Calculation
Examples ).
6. Please provide powers of attorney that relate specifically to each
registration statement as
required by Rule 483(b) of the Securities Act of 1933.
Cover Page
7. Please state that index-linked annuity contracts are complex
insurance and investment
vehicles, and investors should speak with a financial professional
about the contract s
features, benefits, risks, and fees, and whether the contract is
appropriate for the investor
based upon his or her financial situation and objectives.
8. In the fourth paragraph, please clarify that advisory fee withdrawals
will reduce the
account value in addition to the death benefits, and prominently
state that these
deductions could reduce the account value and death benefit by more
than the amount of
the deductions, and, over time, could result in a significant loss of
principal and
previously credited interest. Please also prominently state that, if
possible, an investor
should use a source other than the account value under the contract
to pay advisory fees.
Please provide corresponding disclosure in the At a Glance Key
Features Three
Contract Series (page 9), Risk Factors (page 15), Fee Based Programs
(page 33), and
Partial Withdrawals (page 38) sections of the prospectus.
Darin Smith, Esq.
May 14, 2021
Page 3 of 11
9. In the sixth paragraph, please disclose the name of
the portfolio company. Item
1(a)(viii) of Form N-4.2
10. Please revise the seventh paragraph as follows:
a. Please state the minimum guaranteed
Performance Cap Rates and Segment
Buffers under the contract.
b. In the first sentence, please clarify
that the set period for any Segment is either
one year or six years.
c. In the fourth sentence, please clarify
that the extent of downside protection, also
referred to as the Segment Buffer,
varies by Segment.
d. Clarify here and throughout the
prospectus that the owner bears the risk of a
substantial loss of principal and
previously credited interest with respect to
investments in the Structured Investment
Option. Please explain that principal
and previously credited interest
means the initial amount invested in a Segment.
e. Please revise the bolded disclosure to
state that the performance of the Structured
Investment Option may be negative, and
to make clear that the risk of loss of
principal and previously credited
interest could be as much as 80% to 90% due to
negative index performance.
11. In the eighth paragraph, please specify each type of
distribution occurring prior to a
Segment Maturity Date that triggers a Segment Interim
Value calculation (e.g.,
withdrawal (including a withdrawal to pay advisory
fees under a Series ADV contract
and a free withdrawal under a Series B contract),
surrender, contract cancellation,
transfer). Please also disclose if payment of the
death benefit is considered to be an early
distribution, and if not, please explain, where
appropriate in the prospectus, how the
Segment Rate of Return is calculated if death occurs
prior to the Segment Maturity Date.
Please prominently state that the Segment Interim
Value calculation could result in a loss
of principal and previously credited interest of up
to 80% to 90%. Please state that due to
withdrawal charges, a loss of principal and
previously credited interest under a Series B
contract could be more than 80% to 90%.
12. In the third to last paragraph prior to the rule
30e-3 disclosure, please disclose that the
maximum withdrawal charge for Series B contracts is
7%. Please also more clearly
explain all of the material differences among the
three contract types, as it is not clear
why an investor would purchase a Series B contract
with a withdrawal charge when all
other fees, expenses, and benefits under each series
appear to be the same. Please
2
References herein to Form N-4 requirements refer to those in
place prior to the recently adopted Form amendments. See
Updated Disclosure Requirements and Summary Prospectus for
Variable Annuity and Variable Life Insurance Contracts,
Sec. Act Rel. No. 10765 (March 11, 2020).
Darin Smith, Esq.
May 14, 2021
Page 4 of 11
provide corresponding disclosure in the At a Glance - Three Contract
Series discussion
on page 9.
So that all contract versions are discussed at the outset of the
document, please also move
this paragraph up to follow the first paragraph on the cover page,
and similarly move up
the fourth paragraph regarding the Series ADV contracts.
Definitions of Key Terms (pages 6-8)
13. The Contract does not offer any Segments that provide a return
based on the performance
of an exchange-traded fund. Accordingly, please remove all such
references to
exchange-traded funds here (in the definition of Index) and
elsewhere throughout the
prospectus.
At a Glance Key Features (pages 9-12)
14. Please fix the formatting in the Three Contract Series to make the
discussion more
legible, i.e., provide spaces between paragraphs.
15. In the fourth paragraph under Three Contract Series, please clarify
the statement that each
series has different expenses and withdrawal charge periods, as the
series have the same
expenses (other than the withdrawal charge) and only the Series B
contract has a
withdrawal charge period. Please also clarify the statement that
certain Segments have
Segment Durations that extend beyond the withdrawal charge period,
as both the longest
Segment Duration and the withdrawal charge period are for a
duration of six years.
Please explain why the expiration of the withdrawal charge period
prior to the Segment
Maturity Date is a relevant factor for an investor to consider.
Please also explain why an
investor might be better off purchasing a Series B or Series
ADV contract if he or she
intends to hold the contract for an extended period of time.
16. When stating that there currently is one variable investment
option, please state what it is
(i.e., the EQ/Money Market investment option).
17. As noted later in the prospectus, please state in the Structured
Investment Option
discussion that the Company will announce Performance Cap Rates at
least one week
before the Segment Start Date, and disclose where such rates may be
found.
18. Please clearly state that the Segment Interim Value calculation
will reduce the amount
paid upon surrender or contract cancellation prior to the Segment
Maturity Date, and will
reduce the amount in a Segment following a transfer or withdrawal
(including a
withdrawal to pay advisory fees under a Series ADV contract) prior
to the Segment
Maturity Date, perhaps by more than the amount of the transfer or
withdrawal.
Darin Smith, Esq.
May 14, 2021
Page 5 of 11
19. In the chart comparing the Segment Types, please include the
available Indices for each
type.
20. Please briefly describe the amount to be refunded upon cancellation
of the contract.
Fee Table (pages 13-14)
21. In the narrative preceding the fee table, please clarify that
advisory fees under the Series
ADV would increase the overall cost of a Series ADV contract. Please
make
corresponding changes to the narrative preceding the Examples on
page 14.
22. Please provide the maximum transfer fee and third party transfer or
exchange fee in the
table. Instruction 5 to Item 3 of Form N-4.
23. To avoid investor confusion, please remove the second line item
regarding the Return of
Premium Death Benefit charge in the Annual Contract Expenses table,
and merge the two
footnotes explaining the charge into one footnote. Please clarify in
the footnote that the
charge percentage reduces the Segment Rate of Return.
24. The Segment Interim Value is applied at the time there is a
distribution from a Segment,
rather than on an ongoing basis. Accordingly, please move the
Segment Interim Value to
the Transaction Expenses table. Please make clear that the Segment
Interim Value
applies to withdrawals (including withdrawals to pay advisory fees
under a Series ADV
contract), surrenders, contract cancellation, and transfers).
25. In the narrative preceding the Annual Portfolio Expenses table,
please remove the
references to the Appendix Portfolio Companies available under
the contract, as there
is no such appendix.
26. In the narrative preceding the Examples, please remove the reference
to the maximum
charge with respect to the Return of Premium death benefit, as
there is no maximum
charge.
27. In the Examples, please include expenses for the Series ADV
contract, which should be
the same as the expenses under the Select contract. Please also
explain supplementally
why the expenses for the Series B and Select contracts differ in
year 10 if an owner
surrenders, and why they differ at all if an owner does not
surrender, as the fees and
expenses for these two contracts are the same other than with
respect to the 6-year
withdrawal charge.
28. Please clarify in the disclosure that condensed financial
information has not been
provided because no variable investment option offered by the
prospectus has yet been
sold. See Instruction 1 to Item 4(a) of Form N-4.
Darin Smith, Esq.
May 14, 2021
Page 6 of 11
Risk Factors (pages 15-18)
29. In the first bullet, please state that the risk of loss of
principal and previously credited
interest can become greater in the case of a withdrawal (including
a withdrawal to pay
advisory fees under a Series ADV contract), surrender, contract
cancellation, or transfer
prior to a Segment Maturity Date due to charges and adjustments
imposed on those
distributions, and that this may occur even if index performance
has been positive.
30. Please indent the third and fourth paragraph on page 15 to make
clear that they are part of
the discussion regarding risk of substantial loss of principal. In
the last sentence of the
third paragraph, please remove the reference to a new Standard
Segment, as the
disclosure applies to all types of Segments.
31. When discussing the Performance Cap Rate, please disclose that it
is a rate of return from
the Segment Start Date to the Segment Maturity Date or from the
Segment Start Date to
the first Annual Lock Anniversary (and thereafter from each Annual
Lock Anniversary to
the next), and not an annual rate of return, even if the Segment
Duration is longer than
one year.
32. When discussing the Cap Rate Hold, please provide a cross-reference
to the Cap Rate
Hold discussion on page 28 of the prospectus.
33. In the third primary bullet on page 16, please specify how index
performance will be
measured if the index is changed before the Segment Maturity Date
(e.g., performance
will be recalculated as if the new index had been in place from the
beginning of the
Segment). Please provide corresponding disclosure on page 32 of the
prospectus.
34. Please rewrite the fourth primary bullet on page 16 in accordance
with plain English
principles. In doing so, please clarify what is meant by the
statement that a Segment
cannot be matured until after the scheduled Segment Start Date,
when no Segments
mature prior to the Segment Start Date. Please also explain why an
Index may not
publish its value on a Segment Maturity Date. Please clarify what
happens on the
Segment Maturity Date if there has been a delay due to the index
(e.g., will the Company
create new Segments of Segment Types that utilize unaffected
Indices, or will the
Company transfer the value to a Segment Type Holding Account?), and
explain why
amounts may be transferred to a Segment Type Holding Account, but
will not be
transferred in accordance with the owner s allocation
instructions.
35. With respect to any Index with significant exposure to non-U.S.
companies in emerging
and frontier markets, please provide disclosure with respect to the
following risks:
a) The potential for errors in Index data, Index computation,
and/or Index construction
if information on non-U.S. companies is unreliable or outdated,
or if less
information about the non-U.S. companies is publicly available
due to differences
in regulatory, accounting, auditing, and financial
recordkeeping standards;
Darin Smith, Esq.
May 14, 2021
Page 7 of 11
b) The potential significance of such errors on the Index s
performance;
c) Limitations on the Company s ability to oversee the Index
provider s due diligence
process over Index data prior to its use in Index computation,
construction, and/or
rebalancing;
d) The rights and remedies associated with investments that track
an Index comprised
of foreign securities may be different from investments that
track an Index of
domestic securities; and
e) Risks associated with investments in China.
See ADI 2020-11 Registered Funds Risk Disclosure Regarding
Investments in Emerging
Markets at
https://www.sec.gov/investment/accounting-and-disclosure-information/principal-
risks/registered-funds-risk-disclosure.
Contract Features and Benefits Structured Investment Option (pages
25-32)
36. The prospectus states that the Company is not obligated to offer
any Segment Types.
Please explain supplementally how reserving the right to not offer
any Segments as
investment options is reasonable and consistent with investor
expectations when they
purchased the Contact or how this reservation is suitable for a
Contract offered as a long
term retirement investment vehicle. The only remaining investment
option would be the
EQ/Money Market variable investment option. An investor s only
recourse if he/she
does not wish to invest in this variable investment option would be
to surrender the
Contract and be subject to potential withdrawal charges, taxes, and
tax penalties.
37. Please clarify that the 125% referenced in the Enhanced Upside
Segment example on
page 26 is the Enhanced Upside Rate. If this Segment Type may offer
other Enhanced
Upsides Rates, then please make this clear.
38. On page 28, please clarify in the disclosure that the Performance
Cap Rates announced at
least one week before the Segment Start Date (and published on the
Company s website)
include rates for initial Segments chosen by an investor at the
time of Contract
application.
39. Please revise the Cap Rate Hold discussion on page 28 in accordance
with plain English
principles. In particular, please avoid using unnecessary defined
terms such as secured
Performance Cap Rates and Rate Hold Expiration Date.
40. In the Segment Maturity Value discussion beginning on page 29,
please add subheadings
to precede the Segment Rate of Return description for each Segment
Type.
Darin Smith, Esq.
May 14, 2021
Page 8 of 11
41. The Contract is a complex insurance and investment vehicle, with
multiple index
crediting methodologies. Please include detailed examples to help an
investor understand
how performance is determined under each methodology using various
hypothetical
assumptions (see, e.g., pages 35-41 of the prospectus for the
Company s Structured
Capital Strategies Plus contract, File No. 333-216084). This
information may be
included in the appendix titled Segment Maturity Value Calculation
Examples.
Determining Your Contract s Value Your Contract s Value in the
Variable Investment
Options, Segment Type Holding Accounts and the Dollar Cap Averaging Account
(page 34)
42. Please more clearly state that the charge for the Return of Premium
death benefit is not
reflected in the unit values of the Segment Type Holding Accounts or
the dollar cap
averaging account, and therefore there are two sets of unit values
calculated for the
EQ/Money Market variable investment option.
Determining Your Contract s Value Your Contract s Value in the
Structured Investment
Option (pages 34-35)
43. Please revise the second paragraph to clarify that the Segment
Interim Value calculation
may reduce the Segment Investment, and therefore the amount paid
upon surrender or
contract cancellation. Please also make clear that the amount
remaining in a Segment
following a transfer or withdrawal (including a withdrawal to pay
advisory fees under a
Series ADV contract) will be reduced based on the Segment Interim
Value calculation,
and that this reduction could be more than the amount of the
transfer or withdrawal.
Transferring Your Money Among Investment Options (pages 36-37)
44. Please disclose that transfers out of a Segment prior to the Segment
Maturity Date will
reduce the Segment Investment and, therefore, the Segment Maturity
Value for that
Segment. Please also state that for Annual Lock Segments, a transfer
will also reduce
each Annual Lock Anniversary Starting and Ending Amount. If true,
please state that
these values will be reduced on a pro rata basis by the same
proportion that the Segment
Interim Value is reduced on the date of the transfer. Please state
that this amount could
be greater than the dollar amount of the transfer. Please provide a
cross-reference to the
Segment Interim Value discussion in the prospectus.
45. The prospectus states in various places that a pro rata portion of
the Return of Premium
Death Benefit charge is imposed when calculating the Segment Interim
Value for a
Segment due to early distributions from the Segment, including when
amounts are
transferred from a Segment prior to the Segment Maturity Date.
Because transferred
amounts remain in the Contract, and thus will be assessed this
charge depending on the
investment option to which such amounts are transferred (either as a
percentage of daily
net assets in the variable investment option or as a reduction in
the Segment Rate of
Return in a new Segment), please explain supplementally the basis
for, in effect,
imposing the charge twice on such transferred amounts.
Darin Smith, Esq.
May 14, 2021
Page 9 of 11
Accessing Your Money Partial Withdrawals (page 38)
46. When discussing advisory fee deductions in the last paragraph,
please provide an
example demonstrating the impact of such deductions over time on
account value,
including as a result of the Segment Interim Value calculation.
Accessing Your Money How withdrawals are taken from your account value
(pages 39-40)
47. The penultimate paragraph states that the Company will only accept a
request to
withdraw Segment Maturity Value on the Segment Maturity Date if such
request is
submitted within 12 months of the Segment Maturity Date. Please
explain this restriction
in more detail, including how this works with a one-year Segment
Duration (i.e., does an
investor request this future withdrawal on the Segment Start Date?).
Please also make
this clear each time the prospectus states that an investor can make
withdrawals from
Segments.
Accessing Your Money When to Expect Payments (page 40)
48. Please clarify that the Company will make payments from the variable
investment option
within seven calendar days after receipt of the transaction request.
See Section 22(e)
under the Investment Company Act of 1940.
Accessing Your Money Your Annuity Payout Options (page 41)
49. Please disclose the risk that if the Life Annuity payout option is
selected, there is the
possibility of receiving no income payments if the annuitant dies
before the date the first
payment is scheduled to be made.
Accessing Your Money - The Amount Applied to Purchase an Annuity Payout
Option
(pages 41-42)
50. In the second paragraph, please clarify that a withdrawal charge may
apply under the
Series B contract if a non-life contingent payout option is chosen.
Charges and Expenses Charges that the Company Deducts (page 43)
51. Please revise the disclosure in the first paragraph to state that
the Return of Premium
Death Benefit charge is not deducted from the net assets of the
Segment Type Holding
Accounts or the dollar cap averaging account.
Payment of Death Benefit (pages 47-52)
52. With respect to the example on page 48 that illustrates how
withdrawals to pay advisory
fees reduce the death benefit, please confirm supplementally that
the example reflects the
Segment Interim Value calculation, and make this clear in the
disclosure.
Darin Smith, Esq.
May 14, 2021
Page 10 of 11
Tax Information (pages 53-66)
53. Please confirm that, to the extent relevant, the tax discussion here
and throughout the
prospectus reflects any currently effective provisions of the
Coronavirus Aid, Relief, and
Economic Security (CARES) Act, the COVID-Related Tax Relief Act of
2020, the
Setting Every Community Up for Retirement Enhancement (SECURE) Act,
and the
American Rescue Plan Act of 2021.
STATEMENT OF ADDITIONAL INFORMATION
54. When discussing the net investment factor formula on page 2, please
clarify in prong (c)
that the Return of Premium Death Benefit charge is not deducted for
the Segment Type
Holding Accounts or the dollar cap averaging account. Please also
remove the reference
to daily charges of 1.35%.
********
Responses to this letter should be made in a letter to me filed on
Edgar and in the form of
pre-effective amendments filed pursuant to Rule 472 under the Securities
Act. Where no change
will be made in a filing in response to a comment, please indicate this
fact in the letter to us and
briefly state the basis for your position.
You should review and comply with all applicable requirements of
the federal securities
laws in connection with the preparation and distribution of preliminary
prospectuses.
Although we have completed our initial review of the registration
statements, the filings
will be reviewed further after we receive your response. Therefore, we
reserve the right to
comment further on the registration statements and any amendments. After we
have resolved all
issues, the Company and its underwriter must request acceleration of the
effective date of the
registration statements.
In closing, we remind you that the Company is responsible for the
accuracy and
adequacy of its disclosure in the registration statements, notwithstanding
any review, comments,
action, or absence of action by the staff.
Darin Smith, Esq.
May 14, 2021
Page 11 of 11
Should you have any questions prior to filing pre-effective
amendments, please feel free
to contact me at 202-551-8045 or bentzingere@sec.gov.
Sincerely,
/s/
Elisabeth Bentzinger
Elisabeth Bentzinger
Senior
Counsel
cc: Andrea Ottomanelli Magovern
Sally Samuel