Suitability Checklist for Fixed Annuities - MassMutual

Suitability Checklist for Fixed Annuities For use with Beneficiary/Inherited IRA, Custodial IRA, Traditional IRA, Non-Qualified, Rollover IRA, Roth IRA, and Qualified Longevity Annuity Contract (QLAC) market types only

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This form must be completed for new fixed annuity products. If you need additional information, contact the MassMutual Customer Service Center at 1-866-645-2362 (Monday through Friday, 7 a.m. – 7 p.m. Central Time).

A General Information�� 1. Owner full legal name: 2. Annuitant full legal name (Required if Owner is legal entity): 3. Product:

4. Producer name: 5. Firm Name or Agency number:

B Requirements Checklist �� Item

Completed/IGO

Not Applicable

Fixed Annuity Investor Account Form MassMutual Application Suitability Checklist for Fixed Annuities State replacement form(s) (as required) Producer’s CE credits and/or licensing required for this transaction

C Prohibited Transactions�� If the answer to any of the questions below is True, you must reject the transaction. All Annuity Products 1. The annuity plan type is qualified and Tax-deferred treatment of any growth is the sole reason for the purchase��

True

False

2. The anticipated withdrawals, distributions or surrenders, where permitted, will incur a surrender charge��

True

False

3. The Owner currently has a reverse mortgage ��

True

False

True

False

5. The Owner is purchasing an immediate or deferred income annuity in conjunction with Medicaid ��

True

False

6. For sales to residents of California: The Owner intends to apply for means-tested government benefits, including, but not limited to, Medi-Cal or the veterans’ aid and attendance benefit? ��

True

False

7. The Owner is purchasing an immediate or deferred income annuity and not looking for a Guaranteed credited interest rate, Funding a Life, Disability Income or Long Term Care insurance policy or Guaranteed income through annuitization��

True

False

8. The Owner is purchasing an income annuity and anticipates taking withdrawals from this contract in addition to a payment stream . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

True

False

9. For QLACs only: The Annuitant anticipates making purchase payment(s) greater than $125,000 across all QLAC contracts or 25% of the owner’s aggregated IRA balances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

True

False

MassMutual Odyssey Select & MassMutual Stable Voyage Only SM

SM

4. The Owner is purchasing a fixed deferred annuity and not looking for Tax-deferred treatment of any growth, death benefit protection on invested monies, Guaranteed credited interest rate or Guaranteed income through annuitization�� MassMutual RetireEaseSM & MassMutual RetireEase ChoiceSM Only

MassMutual RetireEase ChoiceSM Only

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Suitability Checklist for Fixed AnnuitiesFR1223-AN 0717

C Prohibited Transactions continued • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • Index HorizonsSM Only 10. The Owner is purchasing a Fixed Index Annuity and is not looking for living benefits, death benefit protection on invested monies, tax-deferred treatment of any growth, retirement income or guaranteed income through annuitization

True

False

11. The owner answered “no” to at least one statement in the Index Horizons section of the suitability profile on the Fixed Annuity Investor Account Form ��

True

False

12. For Annuity, Life and Mutual Fund replacements (except Equity Indexed Annuities): The owner is over age 75 and is paying a surrender charge of 3% or greater��

True

False

D Suitability Scoring �� Total the points from the completed Suitability section (section E, F, G or H) to determine the profile score.

Home Office Reviewer suitability review required Home Office Reviewer Owner contact may be necessary

Standard Review 0-59 Points

Heightened Review 60 or more Points

 

  

Home Office Reviewer Owner contact required



Home Office secondary suitability review required

E Suitability for Odyssey Select & Stable Voyage�� 1. The Owner’s annual income is less than $50,000, liquid net worth is less than $100,000, or the tax bracket is 15% or less: a. Annual income: b. Liquid net worth:

$50K or more (0 pts)

Less than $50K (20 pts)


c. Federal income tax bracket 15% or less:


True (15 pts)

Less than $25K (30 pts) . . . . . . . . . . . . . . Less than $50K (30 pts) . . . . . . . . . . .

False (0 pts) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2. Risk tolerance indicates Owner is aggressive and a fixed annuity product is being purchased: 3. The Owner anticipates taking withdrawals prior to age 59½:

Points

True (15 pts)

True (20 pts)

False (0 pts)

False (0 pts) . . . . . . . . . . . . . . . . . . . . . .

4. The Owner’s sole reason for purchase is death benefit protection on invested monies:

True (10 pts)

False (0 pts) . . .

5. For Stable Voyage only: The product interest rate is 3% or lower and the Owner has the opportunity to select a shorter guarantee period with a higher guaranteed rate than the current selection: True (20 pts) False (0 pts) . . . . . . . . . . . Complete questions 6-9 for replacements only. 6. The Owner will pay a surrender charge and/or recapture charge: False (0 pts) Up to 1% (30 pts) Up to 2% (10 pts) Up to 3% (20 pts) Up to 4% (30 pts) Up to 5% (40 pts) Over 5% (60 pts) . . . . . . . . . . . . . . . . . . . . . . . . . 7. The contract being replaced has internal exchange options, additional riders or death benefits and/or annuitization options available that meet the Owner’s needs which are not being utilized: True (25 pts) False (0 pts) . . . . . . . . . . . . . . . . 8. Within the previous 36 months, the contract has been replaced two or more times:

True (60 pts)

False (0 pts) . . . .

9. For annuity to annuity replacements: The Owner is purchasing a fixed deferred annuity with a same or lower credited rate and the S&P rating of the transferring company is “A-” or higher: True (60 pts) False (0 pts) . . . . . . . . . . . . . . . . . . Complete question 10 if the funds are not coming from a 1035 exchange, qualified transfer and/or rollover. Complete question 11 if the source of funds is non-qualified or if the source of funds is qualified and the client is over 59 ½. 10. The Owner has the option to contribute to an employer-sponsored retirement plan and does not intend to contribute up to the company match: True (10 pts) False (0 pts) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11. This transaction plus other deferred annuity assets is more than 50% of the Owner’s liquid net worth: 50% or less (0 pts) 51%-59% (25 pts) 60%-69% (30 pts) 70% or more (35 pts) . . . . . . . . . . . . . . . . . . . .

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Total from questions 1-11:


F Suitability for RetireEase�� 1. The Owner’s annual income is less than $50,000, liquid net worth is less than $100,000, or the tax bracket is 15% or less: a. Annual income: b. Liquid net worth:






True (15 pts)

Points


False (0 pts) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2. Risk tolerance indicates Owner is aggressive and a fixed annuity product is being purchased:

True (20 pts)

False (0 pts)

3. The Owner is purchasing an income annuity and the primary reason for purchase is not Guaranteed income through annuitization: True (30 pts) False (0 pts) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4. The Owner is aware of a health condition that may shorten his/her life and selects a life option with no refund: True (40 pts) False (0 pts) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5. The Owner is purchasing an income annuity and anticipates taking withdrawals from this contract in addition to a payment stream: True (25 pts) False (0 pts) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6. The Owner is purchasing a single premium immediate annuity and is age 55 or younger:

True (15 pts)

False (0 pts)

Complete questions 7-9 for replacements only. 7. The Owner will pay a surrender charge and/or recapture charge: False (0 pts) Up to 1% (30 pts) Up to 2% (10 pts) Up to 3% (20 pts) Up to 4% (30 pts) Up to 5% (40 pts) Over 5% (60 pts) . . . . . . . . . . . . . . . . . . . . . . . . . 8. The contract being replaced has internal exchange options, additional riders or death benefits and/or annuitization options available that meet the Owner’s needs which are not being utilized: True (25 pts) False (0 pts) . . . . . . . . . . . . . . . . 9. For annuity to annuity replacements: The Owner is purchasing an immediate fixed annuity with the same or lower payout rate and the S&P rating of the transferring company is “A-” or higher: True (60 pts) False (0 pts) . . . . . . . . . . . . . . . Complete question 10 if the source of funds is non-qualified or if the source of funds is qualified and the client is over 59 ½. 10. This transaction exceeds 35% of the Owner’s liquid net worth: 35% or less (0 pts) 36%-49% (20 pts) 50%-74% (40 pts) 75% or more (60 pts) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total from questions 1-10:

G Suitability for RetireEase Choice �� 1. The Owner’s annual income is less than $50,000, liquid net worth is less than $100,000, or the tax bracket is 15% or less: a. Annual income: b. Liquid net worth:






True (15 pts)

Points


False (0 pts) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2. Risk tolerance indicates Owner is aggressive and a fixed annuity product is being purchased:

True (20 pts)

False (0 pts)

3. The Owner is purchasing an income annuity and the primary reason for purchase is not Guaranteed income through annuitization: True (30 pts) False (0 pts) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4. The Owner is aware of a health condition that may shorten his/her life and selects a life option with no refund: True (40 pts) False (0 pts) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5. If electing single life option: No death benefit annuity option or death benefit protection on invested monies is selected as reason of purchase: True (40 pts) False (0 pts) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Complete questions 6-7 for QLACs only. 6. The Annuitant wants to leave an income stream for a non-spouse or wants their beneficiary to have the ability to stretch any death benefit over their life or life expectancy: True (20 pts) False (0 pts) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7. The Annuitant anticipates beginning annuity payments prior to April 2nd of the year they turn 70 ½: True (60 pts) False (0 pts) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Complete questions 8-9 for replacements only. 8. The Owner will pay a surrender charge and/or recapture charge: False (0 pts) Up to 1% (30 pts) Up to 2% (10 pts) Up to 3% (20 pts) Up to 4% (30 pts) Up to 5% (40 pts) Over 5% (60 pts) . . . . . . . . . . . . . . . . . . . . . . . . . page 3 of 5


G Suitability for RetireEase Choice continued • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • •

Points 9. The contract being replaced has internal exchange options, additional riders or death benefits and/or annuitization options available that meet the Owner’s needs which are not being utilized: True (25 pts) False (0 pts) . . . . . . . . . . . . . . . .

Complete question 10 if the source of funds is non-qualified or if the source of funds is qualified and the client is over 59 ½. 10. This transaction exceeds 35% of the Owner’s liquid net worth: 35% or less (0 pts) 36%-49% (20 pts) 50%-74% (40 pts) 75% or more (60 pts) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total from questions 1-10:

H Suitability for Index Horizons �� 1. The Owner’s annual income is less than $50,000, liquid net worth is less than $100,000, or the tax bracket is 15% or less: a. Annual income: b. Liquid net worth:






True (15 pts)

2. The Owner anticipates taking withdrawals prior to age 59½:

Points


False (0 pts) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . True (15 pts)

False (0 pts) . . . . . . . . . . . . . . . . . . . . . .

3. The Owner’s sole reason for purchase is death benefit protection on invested monies:

True (10 pts)

False (0 pts) . . .

4. The Owner’s financial objective is anything other than preservation of capital, income or capital appreciation: True (60 pts) False (0 pts) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5. Owner’s age is: less than or equal to 52 years old (60 points) 53-64 years old (0 points) 65-70 years old (10 points) 71-80 years old (15 points) 81-85 years old (60 points) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6. Risk tolerance indicates Owner is moderate aggressive or aggressive and a fixed index annuity product is being purchased. True (20 points) False (0 points). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Complete questions 7-10 for replacements only. 7. The Owner will pay a surrender charge and/or recapture charge: False (0 pts) Up to 1% (30 pts) Up to 2% (10 pts) Up to 3% (20 pts) Up to 4% (30 pts) Up to 5% (40 pts) Over 5% (60 pts) . . . . . . . . . . . . . . . . . . . . . . . . . 8. The contract being replaced has internal exchange options, additional riders or death benefits and/or annuitization options available that meet the Owner’s needs which are not being utilized: True (25 pts) False (0 pts) . . . . . . . . . . . . . . . . 9. Within the previous 36 months, the contract has been replaced two or more times:

True (60 pts)

False (0 pts) . . . .

10. For fixed deferred annuity replacements only: The fixed deferred annuity being replaced has a crediting rate equal to or greater than the Index Horizons cap rate and the S&P rating of the transferring company is “A-“ or higher: True (60 pts) False (0 pts) . . . Complete question 11 if the funds are not coming from a 1035 exchange, qualified transfer and/or rollover. Complete question 12 if the source of funds is non-qualified or if the source of funds is qualified and the client is over 59 ½. 11. The Owner has the option to contribute to an employer-sponsored retirement plan and does not intend to contribute up to the company match: True (10 pts) False (0 pts) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12. This transaction plus other deferred annuity assets is more than 50% of the Owner’s liquid net worth: 50% or less (0 pts) 51%-59% (25 pts) 60%-69% (30 pts) 70% or more (35 pts) . . . . . . . . . . . . . . . . . . . .

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Total from questions 1-12:


I Owner Contact Notes ��

J Agreements & Signatures�� Home Office Reviewer Attestation and Suitability Determination: By signing this form, I believe that this transaction is: 1.

Suitable. I have reviewed and completed all of the information on this checklist. I believe the purchase of this Annuity is suitable and that the Owner would benefit from its features. Unsuitable. I do not have a reasonable basis to believe this transaction is suitable for the Owner at this time.

2. This Application is approved:



Yes

No

Signature of Home Office Reviewer: Printed name:

Date:

These standards do not apply to recommendations to Plan sponsors when they are deciding Plan funding vehicles. They do apply to recommendations to Plan participants when they have a choice regarding asset allocation and/or which funding vehicle to use for their contributions. A Home Office Reviewer may determine that independent (not including Producer or Owner notes, statements, attestations or standard account documents) documentation (e.g. court orders, settlements, bankruptcy proceedings, etc.) establishes the suitability of the transaction and negates the need for Owner contact. These situations will be rare and the reasons for lack of Owner contact must be specifically documented.

Massachusetts Mutual Life Insurance Company (MassMutual), 1295 State Street, Springfield, MA 01111-0001 and its subsidiaries: C.M. Life Insurance Company and MML Bay State Life Insurance Company, 100 Bright Meadow Boulevard, Enfield, Connecticut 06082-1981.

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Suitability Checklist for Fixed Annuities - MassMutual

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