Adds an ongoing annual fee to a variable annuity in exchange for guaranteeing beneficiaries receive at least a specified minimum amount.
How it works
Current account value times the annual rider fee percentage gives the annual rider cost.
What this does not include
This computes the rider’s ongoing cost only — it doesn’t compute the guaranteed minimum benefit amount itself, which depends on the specific rider’s terms (often the greater of account value or total premiums paid, or a stepped-up value at certain anniversaries).
How to use this calculator
- Enter the current annuity account value and the annual rider fee percentage.
Frequently asked questions
Why would someone pay for a death benefit rider?
To guarantee beneficiaries receive at least a specified amount even if the underlying investments in a variable annuity lose value before the annuitant’s death.
Does the rider fee change over time?
The rider fee percentage typically stays fixed under the contract terms, but the dollar cost changes as the account value itself fluctuates, since the fee is calculated as a percentage of current value.
Are death benefit riders available on fixed annuities too?
Less commonly needed — fixed annuities generally don’t lose principal value the way variable annuity investments can, reducing the need for this specific type of guarantee.
