Annuity type

Fixed Indexed Annuity (FIA)

Also called: Equity-indexed annuity

Principal-protected crediting tied to an index's performance — through caps, participation rates, and spreads that the insurer can usually reset yearly.

Principal: Yes — protected account value
Liquidity: Limited — long surrender schedules
Backed by: State guaranty association, within limits

The decoder

What the quoted number means

A cap or participation rate — not a return

An FIA quote like "10% cap" or "55% participation" describes the ceiling on how much of an index's gain you can be credited — it is not an expected return. Dividends are typically excluded from the index math, the insurer can usually reset caps annually, and long-run credited returns have historically landed between bond-like and CD-like territory. Principal protection is real; the upside arithmetic is narrower than the brochure's chart.

Your premium earns interest credits linked to an index (commonly the S&P 500 excluding dividends), subject to a cap, participation rate, or spread — with a floor of zero, so down years credit nothing but lose nothing. Surrender schedules commonly run seven to ten years.

The insurer funds this by buying bonds plus options; the caps exist because the option budget is whatever the bond yield affords. That is why cap levels move with interest rates, and why credited returns cannot behave like the stock market over time.

Who it tends to fit: loss-averse savers who accept capped upside.

The honest comparison

Fixed indexed vs. a payment stream

An FIA's return is variable and capped; a payment stream's is fixed and stated. The FIA protects principal and keeps an account value; the stream commits capital to a known schedule at a known estimated yield. One is a hedged savings product, the other is committed income — they answer different questions.

What the secondary market pays right now is on our current estimated yields page.

View Available Income Options All Annuity Types

Fixed indexed questions

Do fixed indexed annuities really capture stock market returns?

No — credited interest is limited by caps, participation rates, and spreads, usually computed on an index that excludes dividends, with terms the insurer can reset each year. FIAs are principal-protected instruments whose long-run crediting behaves closer to fixed income than to equities.

What these assets are, and what they are not

Guaranteed and life-contingent structured settlement payment rights, and lottery payment rights, represent the right to receive factored payments that Pacific Structured Assets purchases and assigns to investors through a court-approved process. They are purchased at a discount to their total scheduled payments.

These payment rights are NOT annuities, NOT insurance products, and NOT securities registered with the U.S. Securities and Exchange Commission. They are not bank deposits, are not FDIC-insured, and are not protected by any state insurance guaranty association. The industry term “secondary market annuity” refers to these payment rights and does not mean you are purchasing an insurance annuity contract.

You acquire the right to receive the payments, not the underlying annuity. The annuity itself does not change hands. Unlike the original structured settlement annuity, which may be shielded from creditors under applicable law, the assigned payment rights you purchase generally do not carry that creditor or bankruptcy protection.

Assigned annuities, offered as a separate product line, are existing insurance annuity contracts reassigned to a new owner through a change of ownership or an irrevocable change of payee.

These are long-term holdings with limited liquidity, and may not be suitable for every investor. There is no public trading market and no daily price. Resale or reassignment of a payment stream to another buyer may be possible, and Pacific Structured Assets can assist, but a resale is not guaranteed and the price it would bring is not guaranteed. Because the payments are fixed, that resale value moves with prevailing interest rates: an investor could realize a gain if rates have fallen since purchase, or a loss if rates have risen. These holdings are best suited to capital an investor can commit for the long term. Nothing on this website is tax, legal, financial, or investment advice. Consult your own advisors before investing.

Other types: SPIA · DIA · QLAC · MYGA · Fixed deferred · RILA · Variable

Pacific Structured Assets

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