PRODUCT TYPE

PREMIUM
ALLOCATION

CREDIT RISK

CREDITING RATE
STRATEGY

RISK-BASED
CAPITAL WEIGHTING

General Account

(Portfolio)

New and “old” premiums are blended together

Bank is a high-level, unsecured creditor
(policyholders usually have preference over
any debt and equity holders)

Each bank’s yield is usually based upon a
“blended” yield for that particular block of
business. Yields usually tend to be less
interest-sensitive

100%

General Account

(New Money)

New premiums are not
blended with existing
“old” premiums

Bank is a high-level, unsecured creditor
(policyholders usually have preference over
any debt and equity holders)

Each bank’s yield is usually based upon its
own particular purchase date. Yields usually
tend to be more interest-sensitive.

100%

Separate Account

(Hybrid-Portfolio)

New and “old” premiums
are usually blended
together in the chosen
separate account

“Separate Account” assets are not subject to
risk of carrier default, except for stable value
or other guarantee(s) provided by the carrier.
“Separate Account” asset default risk may be
present (eg, if carrier is in default or carrier
liability is limited).

Each bank’s yield is usually based upon a
“blended” yield realized from the chosen
separate account. Total separate account
returns are subject to market factors, but
the insurance carrier smoothes the “book
yields” over time.

Look through to
underlying assets.
RBC weighting may
be as low as 20%

Separate Account

(Hybrid-New Money)

New premiums are not
blended with existing
“old” premiums

“Separate Account” assets are not subject to
risk of carrier default, except for stable value
or other guarantee(s) provided by the carrier.
“Separate Account” asset default risk may be
present (eg, if carrier is in default or carrier
liability is limited).

Each bank’s yield is usually based upon its
own particular purchase date. Yields usually
tend to be more interest-sensitive.

Look through to
underlying assets.
RBC weighting may
be as low as 20%

Separate Account

New and “old” premiums
are usually blended
together in the chosen
separate account

“Separate Account” assets are not subject to
risk of carrier default. However, underlying
“Separate Account” asset default risk is
passed to the bank. “Third Party Risk” may
also be present with “stable value” provider.
“Stable Value” contracts may also have pro-
tection limits.

Each bank’s yield is usually based upon a
“blended” yield realized from the chosen
separate account. Total separate account
returns are subject to market factors, but a
“stable value” provider will usually be used
to smoothe the “book yields” over time.

Look through to
underlying assets.
RBC weighting may
be as low as 20%

The above information is intended only for general information purposes. Actual product features/benefits may vary among product types and across insurance carriers.
Bank Compensation Group, Inc. or its representatives do not warrant the performance of any particular insurance carrier or product or the general information presented above.
Purchaser should review actual NAIC approved product, a product prospectus (if applicable), and other materials related to their specific purchase consideration.