Our Professional Opinion on the Zenith Growth and Growth Driver Annuities
Zenith Growth is the better starting point for new accumulation money. Growth Driver deserves a look when its upfront bonus solves a specific problem, but that bonus comes with serious strings attached. Both are fixed indexed annuities from National Life Group designed to grow savings without direct stock-market losses. Neither should be selected just because an illustration shows an attractive index return.
Life Insurance Company of the Southwest is a great annuity company. Its A+ AM Best financial-strength rating is above our A- minimum. A great company does not automatically make every version of its annuities the right choice.
We would start with Zenith Growth 5 for someone seeking a straightforward accumulation annuity. It has no premium bonus to recapture and offers the shortest commitment in the family. The seven- or ten-year Zenith version can make sense if its actual contract terms justify the extra years; we would not accept a longer surrender period just to buy a bigger illustration.
Growth Driver 7 and 10 offer genuine upfront premium bonuses, but the bonus is not free money. The version illustrated here adds 7% or 10% of eligible premium to the account and applies a recapture schedule. We would consider it when the bonus helps offset a replacement charge or improves an owner’s withdrawal or death-benefit outcome after a genuine comparison. For new accumulation money, we would usually compare Zenith Growth and other non-bonus annuities first.
The Growth Driver withdrawal rules are the biggest catch. Some withdrawals that are free of surrender charges and the market value adjustment can still trigger bonus recapture. The bonus can improve the beneficiary payout when it is retained at death, but its full amount should not be treated as freely spendable cash during the recapture period.
We favor the traditional S&P 500 options and one-year crediting for most buyers. Compare the actual cap, renewal terms and availability of a cap lock. A high participation rate on a custom index or a fee for an enhanced cap does not tell you what your money will earn.
What We Like
- A+ rated issuer: Life Insurance Company of the Southwest exceeds our minimum rating standard.
- Clear choice between bonus and no bonus: Zenith Growth focuses on accumulation without a premium bonus; Growth Driver adds a real premium bonus.
- Multiple contract lengths: Zenith Growth offers five-, seven- and ten-year versions; Growth Driver offers seven and ten.
- Traditional S&P 500 choices: The available menu includes straightforward ways to measure index performance.
- One-year crediting: Buyers do not have to rely entirely on two-year crediting periods.
- Health waivers: Qualifying events may provide access under the issued rider and state rules.
- Growth Driver death benefit: Eligible beneficiaries can receive the bonus in the accumulation value when the contract waives recapture at death.
What We Don’t Like
- First-year liquidity: The ordinary free-withdrawal allowance begins after the first policy year.
- Bonus recapture: Growth Driver can recapture bonus on withdrawals even when the normal surrender charge and MVA are waived.
- Renewal uncertainty: A rate quoted today is not necessarily protected for the entire contract unless the selected strategy expressly locks it.
- Rate Booster cost: A higher cap or participation rate can come with an annual charge even when no interest is credited.
- No GLWB on these versions: These are accumulation contracts; a lifetime withdrawal benefit requires a different product.
- Longer commitments: Seven- and ten-year contracts limit flexibility and need a real advantage to justify the extra time.
Product Overview
Zenith Growth and Growth Driver are single-premium fixed indexed annuities issued by Life Insurance Company of the Southwest. Both offer interest based on a selected index strategy or a declared fixed rate, subject to the contract. The owner does not buy shares of an index or directly invest in the stock market.
Zenith Growth has no premium bonus and is available in five-, seven- and ten-year designs. Growth Driver has seven- and ten-year designs with an upfront bonus. The contracts described below can accept additional eligible deposits within the first 90 days; that does not make them ongoing flexible-premium accounts.
Key Features
| Feature | Zenith Growth | Growth Driver |
|---|---|---|
| Primary goal | Accumulation without an upfront premium bonus | Accumulation with an upfront premium bonus |
| Available terms | 5, 7 or 10 years | 7 or 10 years |
| Issue ages in described versions | 0–85 | 0–75 |
| Minimum deposit | $25,000 within the funding period | $25,000 within the funding period |
| Premium bonus | None | 7% on the 7-year; 10% on the 10-year, subject to the contract |
| Bonus recapture | Not applicable | Applies during the applicable recapture period |
| Index options | One- and two-year strategies; S&P 500 available | One- and two-year strategies; S&P 500 available |
| Free withdrawals | Generally up to 10% after the first policy year | Generally up to 10% after the first policy year; bonus recapture may still apply |
| Lifetime income rider | Not available on these accumulation designs | Not available on these accumulation designs |
| Base administrative fee | None stated | None stated |
Zenith Growth: The Cleaner Accumulation Choice
Zenith Growth 5 is our preferred starting point for new savings. It offers a five-year commitment, a traditional S&P 500 strategy and no premium-bonus recapture. That makes it easier to compare the actual account value and withdrawal rights with other accumulation annuities.
The seven- and ten-year versions should earn their longer commitment with meaningfully stronger terms. A longer lock may be useful when the quoted index terms are contractually protected, but an initial cap that can be reduced later is not the same thing as a multiyear cap lock. If two contracts have similar terms, we prefer keeping the extra flexibility.
Compare Zenith with Oceanview CapLock, Sagicor Sage Accumulator and other competitive accumulation options. The comparison should include the same premium, index, annual crediting, surrender term, liquidity and protection against future reductions in the cap.
Growth Driver: How the Premium Bonus Works
Growth Driver credits a premium bonus to the actual accumulation value. In the versions described, Driver 7 adds 7% and Driver 10 adds 10% to eligible premium, including qualifying deposits within the first 90 days. On a $100,000 eligible deposit, a 7% bonus adds $7,000 to the account. The bonus can participate in future contract growth, but it can also be recaptured under the contract rules.
That initial $107,000 account value is not necessarily a $107,000 surrender value. An early exit can result in bonus recapture, a surrender charge and an MVA. A no-bonus contract can have better caps or participation rates and may ultimately leave more money. Request year-by-year values for both contracts rather than treating the bonus itself as the answer.
We primarily like a bonus when it solves a measurable problem: for example, helping offset the cost of leaving an existing contract, potentially improving money available after a planned series of withdrawals, or improving what beneficiaries receive if death occurs early and the bonus is included. In every case, the actual available values and restrictions matter.
The Bonus Recapture Schedule
For the illustrated Growth Driver 7 version, the bonus-recapture percentages are 90%, 80%, 70%, 60%, 50%, 40% and 30% in policy years one through seven. These are not surrender charges on the entire account: the contract determines how the recapture percentage applies to the affected bonus. The 10-year version uses a longer schedule. Verify the issued policy and exact calculation before assuming what you can withdraw.
Here is the problem: after year one, an ordinary withdrawal of up to the 10% allowance may avoid the normal withdrawal charge and MVA, but the Growth Driver 7 contract can still recapture part of the bonus. A “penalty-free withdrawal” does not automatically mean the bonus stays untouched. We do not like that rule for someone buying the product mainly to take regular distributions.
If you are replacing another annuity, compare the old contract’s surrender value with Growth Driver’s new account and surrender values after the same withdrawals. The bonus only helps if the actual result outweighs the old contract’s loss and the new contract’s restrictions.
S&P 500, Index Options and Renewal Terms
The S&P 500 cap sets a maximum credit for the selected period. For a one-year point-to-point account, the insurer measures the index change from the beginning to the end of the term and credits interest under the cap. An owner does not receive S&P 500 dividends. A negative index result generally produces a 0% index credit, not a deduction for the market decline.
The available menu has also included an S&P 500 performance trigger: when the index is flat or positive over the stated term, the contract credits a declared rate; a negative result can produce no credit. That differs from matching the index gain up to a cap. The declared trigger matters more than an example that assumes it will never change.
Some versions also include other index strategies and participation rates. Custom indexes can use allocation or other rules that make them behave differently from the plain S&P 500. A participation rate above 100% is not a return and does not prove the index will produce more interest. Review the actual index methodology and any embedded costs.
The one-year crediting strategy is our preferred starting point. A two-year term can offer different caps or participation rates, but it normally waits until the end of the full period to calculate the credit. Compare what happens to a pending credit if you withdraw or die before that period ends.
Ask whether the actual cap is locked. Some quoted strategies renew at newly declared terms after the crediting period. National Life has also announced S&P 500 cap-lock and trigger-lock strategies; eligibility varies by product and version. Confirm that the specific Zenith or Growth Driver illustration includes a lock and exactly how long it lasts. Do not assume a current cap is protected for the full surrender period.
Rate Booster: Higher Caps With a Real Cost
Rate Booster is an optional enhanced crediting choice that can provide a higher cap or participation rate. The version described charges 1% annually on money allocated to the boosted strategy. That charge continues even when the selected index credits no interest.
We are cautious about paying for Rate Booster. The higher cap must add enough actual interest to recover the charge; a more attractive illustration is not proof that it will. Compare the same strategy with and without the fee across weak, flat and strong results. A 0% index floor does not prevent the booster charge from reducing account value in a zero-credit year.
Liquidity and Surrender Charges
Both contracts generally provide up to 10% of accumulation value annually without a normal withdrawal charge or MVA after the first policy year. There is no ordinary 10% free allowance in year one. As noted above, Growth Driver’s bonus recapture is a separate issue and may apply even to a withdrawal within the allowance.
The illustrated schedules below apply to the product versions described. The surrender charge applies under the policy’s withdrawal rules; an MVA and, for Growth Driver, bonus recapture can further affect an early withdrawal. On a 10-year contract, an MVA may still apply to excess withdrawals in year 10 even though the listed surrender charge is 0%. State and contract variations matter.
| Policy year | 5-year charge | 7-year charge | 10-year charge |
|---|---|---|---|
| 1 | 8.25% | 8.25% | 8.25% |
| 2 | 8% | 8% | 8% |
| 3 | 7% | 7% | 7% |
| 4 | 6% | 6% | 6% |
| 5 | 5% | 5% | 5% |
| 6 | 0% | 4% | 4% |
| 7 | 0% | 3% | 3% |
| 8 | 0% | 0% | 2% |
| 9 | 0% | 0% | 1% |
| 10 | 0% | 0% | 0% |
A market value adjustment can increase or decrease the value of an affected early withdrawal as interest rates change. A 0% surrender charge in the final displayed year does not automatically mean the MVA or every other restriction has ended. Check the contract’s actual MVA period and the value payable on your requested date.
Death Benefit and Spousal Continuation
The accumulation value generally determines the amount paid when an eligible death triggers the contract’s death benefit. For the Growth Driver 7 version described, the insurer says the beneficiary receives the accumulation value without withdrawal charges or bonus recapture when the annuitant dies before annuitization. That can make the bonus valuable to a family even though it is subject to recapture on ordinary withdrawals.
A surviving spouse may have spousal continuation rights if permitted by the issued contract and applicable rules. Confirm whether the spouse can continue the contract, how the bonus and index credit are treated, and what a non-spouse beneficiary actually receives. Do not assume a special death benefit from an income product applies to these accumulation contracts.
Health Waivers
Nursing-care and terminal-illness waivers can provide access to part of the contract value without normal withdrawal charges when the owner meets the rider’s conditions. State availability, timing and proof requirements matter. Certain employer-plan versions may also include an emergency-access waiver with specific plan requirements.
A health waiver helps you access your existing money; it is not an additional long-term care benefit. If care costs are the concern, compare long-term care insurance separately.
Who Should Consider These Annuities?
- Zenith Growth 5: Someone who wants an accumulation FIA from a highly rated insurer and prefers a shorter commitment without a bonus-recapture schedule.
- Zenith Growth 7 or 10: Someone who can hold the contract longer and receives a meaningful advantage in the actual guaranteed terms.
- Growth Driver 7 or 10: Someone who understands the recapture and can document why the upfront bonus improves a replacement, withdrawal or beneficiary outcome.
- Buyers who should pass: Anyone who needs ordinary first-year access, wants guaranteed lifetime withdrawals from these contracts, or cannot tolerate the surrender period and potential MVA.
Final Verdict
Zenith Growth is the better first quote for straightforward accumulation; Growth Driver is a specialized bonus option, not our default for new money. Start with Zenith Growth 5, then compare seven or ten years only when the longer commitment provides a real advantage. With Growth Driver, examine what happens to the bonus on withdrawals, surrender and death before deciding that the larger first-day account is better.
Compare the actual S&P 500 terms, whether a cap is locked, the cost of any Rate Booster, and the cash and beneficiary values with other competitive insurers. A strong company rating is a reason to consider the contracts; the product terms decide whether to buy.
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