North American Introduces Fidelity Index

West Des Moines, Iowa, May 5, 2020

To meet growing client concerns about market volatility, North American Company for Life and Health Insurance® (North American) is launching access to a new index designed by Fidelity for use in its crediting strategies. The index combines key factors in such a way to help enhance returns and manage risk given the current volatility of today’s markets.

The Fidelity Multifactor Yield Index 5% ERSM leverages Fidelity’s established legacy of asset management capabilities. This new index will be added as an available option to North American’s VersaChoice fixed index annuity.

“Any index seeks to capitalize on market growth, however, it can be challenging as we witness the fluctuating markets today’s investors face,” said Bryce Biklen, chief distribution officer for North American’s annuity division.  “This new index is targeting a combination of factors, which aim to enhance returns with a focus on dividend yield. Our goal is to optimize growth potential.”

A factor refers to a characteristic of a security that helps explain its risk and return behaviors. By combining key factors with a focus on stable, lower risk, the Fidelity Multifactor Yield Index 5% ERSM seeks to deliver more consistent returns over time. This new index blends six specific equity factors which include:

  • Dividend Yield—securities that pay higher dividends
  • Low Volatility—securities of historically lower-risk
  • Momentum—positive-trending securities
  • Quality—financially healthy companies
  • Size—smaller, potentially more agile companies
  • Value—securities that are relatively less expensive

A feature of this index is a 5% volatility control target that aims to maintain consistency through changing market conditions. A fixed-income overlay, which can include 10-year treasuries and cash, is applied to help control volatility. This overlay can adjust daily to help meet a 5% volatility target.

“We’re committed to helping our clients solve challenges and continuously look for opportunities to leverage our asset management capabilities to provide them with solutions,” said Matt Aurelia, senior vice president, Fidelity Institutional.  

The new Fidelity Multifactor Yield Index 5% ERSM is now available through North American, a member company of Sammons Financial Group.

“Our agents—and more importantly their clients—expect innovation backed by expertise in meeting today’s financial planning challenges,” said Biklen.  “This new index is a sound tool to meet changing client needs.”

About North American Company for Life and Health Insurance

North American Company for Life and Health Insurance® is a member company of Sammons® Financial Group, Inc. Since 1886, North American has established a tradition of providing quality insurance products to consumers throughout the U.S. We offer a comprehensive portfolio of term, universal life, and indexed universal life insurance products. North American also offers a wide variety of traditional fixed and fixed index annuities and consistently ranks among the top fixed index annuity carriers in the U.S. (Source: Wink Sales & Market Report, 2018).

About Sammons® Financial Group, Inc.

The companies of Sammons® Financial Group, Inc. help families and businesses protect their future to enjoy life’s moments today. A subsidiary of Sammons Enterprises, Inc., Sammons Financial Group is privately owned with member companies that are among the most enduring and stable in the financial services industry. Our companies include Midland National® Life Insurance Company (including Sammons® Corporate Markets); North American Company for Life and Health Insurance®; and Sammons Institutional GroupSM (including Midland Retirement DistributorsSM and Sammons Retirement Solutions®). Together, we offer today’s most sought-after life insurance, annuity, and retirement planning products.

The Fidelity Multifactor Yield Index 5% ER (Index) is the property of Fidelity Product Service LLC (FPS) a Fidelity Investments company. Neither the Index nor any information related to the Index presented in this document is investment advice nor a recommendation to buy or sell any security, strategy or investment product. FPS is not an investment adviser, broker-dealer, or issuer of securities and it does not have any fiduciary responsibility in respect of the Index, licensee(s) of the Index, or any product that may utilize the Index.

The Index has been licensed for use by Sammons Financial Group on behalf of its insurance subsidiaries, Midland National or North American. Fidelity, nor any of its affiliates, or any of their respective third-party licensors (including the Index calculation agent, as applicable) endorses, sells, or promotes any product sold by Midland National and North American. Fidelity has no obligation or liability in connection with the administration or marketing of any Midland National and North American product. Fidelity makes no representation or warranty, express or implied, to the owners of any Midland National and North American product or any member of the public regarding the advisability of investing in any Midland National or North American product or the ability of the Index to track general market performance.

FPS disclaims all warranties, express or implied, including all warranties of merchantability or fitness for a particular purpose or use. FPS does not guarantee the adequacy, accuracy, completeness, timeliness, and/or performance of any Index or any data related thereto and shall have no liability in connection with any Index or Index calculation, errors, omissions or interruptions of any Fidelity Index or any data included therein. The Indices are unmanaged and are not available for direct investment. FPS uses an independent calculation agent to calculate each Index.

The Fidelity Multifactor Yield Index 5% ER is a service mark of FMR LLC.