Our Professional Opinion on the Security Benefit Blueprint Annuity
We like Blueprint’s design for accumulation: a traditional S&P 500 strategy with an annual cap you can lock for the entire three- or five-year surrender period. You get a chance to lock in an interest credit each year without worrying that Security Benefit will lower that particular cap while you are still subject to surrender charges.
That does not make Blueprint an automatic recommendation. There is no ordinary free withdrawal in the first year, and the regular 10% allowance does not apply to a full surrender during the charge period. The health waivers also have longer waits than many buyers might expect. If you need access soon, we would choose an annuity with better first-year liquidity instead.
Security Benefit Life Insurance Company is a good insurer in our opinion. Its A− (Excellent) AM Best financial strength rating meets our minimum, but it is not among the highest-rated companies. We would compare the actual locked cap and withdrawal terms with annuities from other insurers before choosing Blueprint.
We would start with the three-year version if it is available and the terms are competitive. We would consider five years when the cap or fixed rate is attractive enough to justify the additional commitment. Compare both with a fixed-rate MYGA: Blueprint can earn more, but its indexed account can also earn zero interest in a year.
What We Like
- A full-term S&P 500 cap lock: The guaranteed-cap strategy protects its initial cap for three or five years.
- Annual index crediting: A gain can be credited each year; you do not have to wait until the surrender period ends.
- A traditional index: The S&P 500 choices are easier to compare than many engineered index formulas.
- Relatively short terms: Three and five years are more manageable than surrender periods lasting a decade or longer.
- A guaranteed fixed-rate choice: A fixed account can lock its rate for the selected guarantee period.
What We Don’t Like
- No ordinary first-year free withdrawal: Keep money you may need soon outside this annuity.
- The 10% allowance does not apply to a full surrender: An early exit can face charges on more of your money than a partial withdrawal would.
- You must choose the locked strategies at purchase: Money allocated to a guarantee-period strategy must remain in that allocation for its term, subject to withdrawal rules.
- Health-waiver limitations: The standard waiting period is three years; availability and rules vary by state.
- The insurer only meets our minimum: An A− rating is acceptable, but we would compare stronger insurers when the offers are similar.
Security Benefit Blueprint Annuity Overview
Blueprint is a single-payment fixed indexed annuity issued by Security Benefit Life Insurance Company. It offers a three- or five-year surrender period and annual crediting based on the S&P 500, along with fixed-interest options. Some distribution firms offer only the five-year version. It is not available for sale in New York.
Key Features
- Minimum deposit: $10,000; deposits above $2 million require insurer approval.
- Issue ages: Generally ages 0–90, subject to the contract’s rules.
- Guarantee choices: A term-guaranteed S&P 500 cap and fixed rate, or one-year strategies with annually declared terms.
- Withdrawals: Generally 10% of beginning-of-year account value annually after the first anniversary, subject to the partial-withdrawal rules.
- Surrender periods: Three or five years, with a market value adjustment except where state rules differ.
- Death benefit: Generally the greater of the account value or guaranteed minimum cash surrender value, subject to contract terms.
How the S&P 500 Cap Lock Works
The annual point-to-point index account with a guarantee-period cap uses the S&P 500 and measures it over one-year periods. The cap selected at issue applies each year for the full three- or five-year guarantee period. An eligible gain is credited at the end of each contract year.
That is the feature we would look at first. An annuity with a higher introductory cap can look better on day one, but if the insurance company can cut it after the first year, your remaining growth opportunity may be much weaker. A competitive cap locked for the full surrender period removes that particular uncertainty.
The cap is a limit, not a promised return. If the S&P 500 ends an annual period flat or down, the indexed interest credit is zero. Your money is not invested directly in the index, and the index used for crediting does not include dividends.
Blueprint also has an annual S&P 500 cap account and a trigger-rate account whose terms can be declared for later years. They do not automatically receive the full-term cap lock. Compare the actual guaranteed-cap quote with the renewal-risk tradeoff before deciding.
The Fixed Account and Allocation Rules
Blueprint also offers a fixed account with a rate guaranteed for the three- or five-year period, as well as a one-year fixed account. The multiyear fixed rate is a stated interest rate on that allocation; the locked S&P 500 cap is only the ceiling in an index-interest formula.
You must select the guarantee-period strategies at issue, and money allocated to them generally stays in that strategy for the entire guarantee period, subject to the contract’s withdrawal rules. Once that period ends, the company automatically moves the value to the one-year fixed account unless you choose another available one-year renewal strategy. The original guarantee-period strategy does not automatically start a new three- or five-year guarantee.
We like knowing the original crediting terms, but we do not like discovering after purchase that an allocation cannot be switched midterm. Decide how much you want in each choice before buying.
Three Years or Five Years?
| Feature | Blueprint 3 | Blueprint 5 |
|---|---|---|
| Surrender period | 3 years | 5 years |
| Locked-cap period | 3 years | 5 years |
| Standard surrender charges | 9%, 8%, 7% | 9%, 8%, 7%, 6%, 5% |
| First ordinary free withdrawal | After year one | After year one |
The three-year choice is our starting point when it is available: you can reassess sooner. A longer lock can still make sense if its actual terms are compelling and you can leave the money alone. State and distribution-firm availability can differ, and California uses a different charge schedule.
Withdrawals, Surrender Charges, and the MVA
There is no ordinary penalty-free withdrawal in the first contract year. After the first anniversary, you can generally withdraw up to 10% of the account value at the beginning of that contract year without a surrender charge or market value adjustment.
The catch is that this ordinary allowance does not apply to a full surrender or annuitization during the surrender period. If you want to leave entirely, ask for an actual surrender quote. Do not assume the first 10% of a full surrender is charge-free.
An excess withdrawal or early surrender can incur a surrender charge and a market value adjustment. The MVA can increase or decrease the proceeds and may also apply if you annuitize during the surrender period. California does not apply an MVA; other state rules can differ.
A required minimum distribution from a qualified contract can be processed without surrender charges or an MVA on request. Confirm the amount and process before depending on it for a larger withdrawal.
Nursing Home and Terminal Illness Waivers
The five-year version can waive surrender charges and, where permitted, the MVA for qualifying nursing home confinement or terminal illness. The standard waiting period is three contract years. That wait stinks if you need help during the first few years.
The three-year version generally does not provide these waivers during its surrender period. Rules differ by state: Connecticut has no waiting period, while Pennsylvania and Texas generally have a one-year wait for the five-year waivers; in those states the MVA is not waived. California does not offer these waivers, Massachusetts does not offer the nursing-home waiver, and New Jersey does not offer the terminal-illness waiver.
A waiver gives you access to your own money when you qualify. It is not a substitute for long-term care insurance or an emergency reserve.
Death Benefit and Spousal Continuation
The death benefit is generally the greater of the account value or guaranteed minimum cash surrender value when an owner dies, or when the annuitant dies if the owner is a non-natural person. Withdrawals reduce the money left to beneficiaries. Certain joint-ownership death circumstances can involve an MVA, so confirm the calculation for your ownership and state.
If your spouse is the beneficiary, ask whether the contract permits spousal continuation and how that election would affect the death benefit and remaining guarantee period. Do not assume continuation is automatic.
What We Would Compare Instead
For guaranteed growth, compare Blueprint’s fixed account and indexed option with a MYGA of the same term and comparable access. A MYGA guarantees the actual interest rate for the term. Blueprint’s locked cap offers a known ceiling, but not a guaranteed indexed return. If the MYGA already meets your savings goal, we would not give up that certainty simply because the indexed cap looks attractive.
Also compare other indexed annuities with a traditional annual S&P 500 strategy and a locked cap. Include insurer strength, first-year access, MVA treatment, and what happens after the guarantee ends. A slightly higher cap is not the whole decision.
If your main goal is income for life, Blueprint is not our starting point. Compare an annuity with a guaranteed lifetime withdrawal benefit, using the same deposit, ages, start date, and covered lives. Blueprint’s account growth does not by itself guarantee a lifetime withdrawal amount.
Our Final Verdict on Blueprint
Blueprint deserves a serious look when its locked S&P 500 cap is competitive. Its short terms and annual crediting fit the way we prefer to evaluate an accumulation annuity. Start with the three-year version if available, then compare the five-year offer and the guaranteed result of a MYGA.
The first-year restriction, full-surrender rule, and limited health waivers are the catches. If you need early access or a stronger-rated insurer offers comparable terms, we would choose the alternative.
Contact The Annuity Expert for free annuity quotes. We can compare Blueprint with other fixed and indexed annuities for your deposit, timeline, and liquidity needs.
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