Equitable expands portfolio in VUL market

NEW YORK — February 2, 2022 – Equitable has announced the launch of an enhanced version of its Market Stabilizer Option. The new offering, Market Stabilizer Option II (MSO II), is available on all single life variable universal life (VUL) products issued by Equitable Financial Life Insurance Company (Equitable Financial) and Equitable Financial Life Insurance Company of America (Equitable America) that are currently sold in the marketplace. MSO II helps clients navigate today’s volatile markets and enables them to thrive, create wealth and protect legacies.

With the launch of MSO II, Equitable Financial and Equitable America are building on more than a decade of experience offering buffered indexed options in the life insurance and annuity markets. The new MSO II options, which include Standard, Step Up and Dual Direction segments that track the S&P 500 Price Return Index, are similar to the most popular buffered options available in Equitable Financial and Equitable America’s annuity products. A market leader in the annuity market, Equitable Financial is ranked the #1 Registered Index Linked Annuity (RILA) provider by LIMRA, based on 2021 sales data.

“In an economic climate marked by equity market volatility, inflation and a possible recession, our clients are more conscious of the need to protect their wealth and are looking for ways to maximize the cash value in their VUL policies to the fullest,” said Hector Martinez, Head of Life Insurance at Equitable. “From pioneering the first variable life insurance product in 1976 to being the first insurer to offer VUL with a buffered indexed option in 2010, we have a track record of innovation in the VUL market. MSO II underscores our commitment to this space.”

The new MSO II offering takes a unique and innovative approach to managing market volatility. Unlike other VUL offerings that have limited or no buffered indexed options, MSO II offers a choice of five options based on clients’ investment goals, risk tolerance and life stage, and three buffers with various levels of downside protection. These options are consistent with some of the most popular options available on Equitable’s annuity products, such as Structured Capital Strategies Income and Structured Capital Strategies PLUS. The five buffered indexed options include:

• Standard with -10% protection buffer: Provides upside potential with some downside protection and typically has the highest growth cap rate of the five MSO II options. The growth cap rate changes monthly on all options and is 17.50% as of January 20, 2023.
• Standard with -15% protection buffer: Provides a balance of upside potential and downside protection with a growth cap rate of 14.50% as of January 20, 2023.
• Standard with -20% protection buffer: Provides upside potential with the largest downside protection of the five options with a growth cap rate of 12.75% as of January 20, 2023.
• Step Up with -10% protection buffer: Offers potential for a higher return than the index with a return that “steps up” to a cap when the market is either flat or up. The growth cap rate is 13.00% as of January 20, 2023.
• Dual Direction with -10% protection buffer: Provides upside potential, including the possibility of a positive return when the index is down with a growth cap rate of 15.00% as of January 20, 2023.

In addition to the five buffered options, policy owners have more than 80 investment options to select from based on their investment style, including index portfolios, asset allocation portfolios and equity, and fixed income portfolios. Clients can allocate some, none or all of their policy cash value to the buffered options or the other investment funds.

“While many financial professionals and their clients find the value traditional VUL products provide attractive, they often are reluctant to make them a part of a financial plan during periods of market turbulence,” said Garry Tilton, Head of Life Insurance Products at Equitable. “Recognizing this reality, we’ve leveraged our expertise in the buffered indexed option space to design a more well-rounded offering that can provide them with more choice, flexibility, upside potential and downside protection in uncertain times.”