How Essential Income 7® works

Allianz Life Insurance Company of North America

If you are concerned about saving enough for retirement – and you want guaranteed lifetime income that can help cover your essential expenses throughout retirement – Essential Income 7® Annuity may be a good choice. Essential Income 7 Annuity provides the typical features of fixed index annuities including principal protection from market loss, the potential for tax-deferred growth, options for lifetime retirement income, and a death benefit for your beneficiaries.

While you’re saving for retirement, Essential Income 7 offers:

  • simplified indexing with annual point-to-point crediting, and
  • powerful indexed interest potential through two index allocation options.

And when you’re ready to start receiving income, the Essential Income 7 Annuity with its built-in Essential Income Benefit (included at an additional cost):

  • gives you increasing lifetime withdrawal percentages every year until you begin withdrawals, and
  • guarantees income for life through lifetime withdrawals.

Plus, Essential Income 7 Annuity has a seven-year surrender charge period — so you can access the money in your contract without surrender charges after only seven years.

Issue age and minimum

You must be between the ages of 0-80 in order to purchase Essential Income 7.

The minimum initial premium payment is $10,000 for qualified and nonqualified money.


The participation rate is 100% guaranteed for the life of the contract. This means we use the entire percentage of index change when we calculate the indexed interest rate. Caps would still apply. The cap is the maximum percentage of index change we use for a specified time period to determine how much interest we credit to your annuity in a given contract year.

Call your Allianz financial professional for current caps and interest rates.

Allocation options

Annual point-to-point with a cap: S&P 500® Index, Bloomberg US Dynamic Balance Index II

Income or accumulation benefits

The Essential Income Benefit is included with the Essential Income 7 Annuity for an additional charge. It offers increasing income withdrawal percentages (beginning at age 45) until lifetime withdrawals begin or annuitization is started. It also offers a choice of two income payment options: predictable payments and payments with the opportunity to increase. Once lifetime income withdrawals begin, access to penalty-free withdrawals is no longer available.

The annual benefit charge for the Essential Income Benefit is a percentage of the accumulation value, deducted monthly from the accumulation value and guaranteed minimum value (in most states). The annual benefit charge percentage for the guaranteed minimum value is 1.05% for all contract years. The annual benefit charge percentage for the accumulation value is 1.05% for the first contract year. It can change each year during the next six contract years, but will not be more than 2.50%. After the seventh contract year, the annual benefit charge percentage will be 1.05% for all remaining contract years. The benefit charge will continue for the life of the contract even after lifetime income payments have begun.

Annual payout percentage increases apply to ages 45 and above. Lifetime benefit withdrawals cannot begin before age 50.

Access your money

With our penalty-free withdrawal option, after the first contract year, up to 10% of the contract’s premium paid can be withdrawn each contract year, as long as the money is withdrawn after the contract anniversary following the most recent premium payment; maximum is cash surrender value.

Essential Income 7 has a seven-year surrender charge period (8.5%, 8.0%, 7.0%, 6.0%, 5.0%, 4.0%, 3.0%, 0%). The surrender charge percentage will decrease 1/12 of 0.5% on each of the first 12 monthiversaries. On each subsequent monthiversary, the surrender charge will decrease by 1/12 of 1%. On day one of contract year 8, it will be zero.

Market Value Adjustment (MVA): If the contract is partially or fully surrendered (not including 10% free withdrawals and Required Minimum Distributions), it will be subject to an MVA during the surrender charge period. An MVA will also apply if the contract is annuitized prior to the sixth contract year or if annuity payments are taken over a period of less than 10 years.

MVA reference rate

Payout options

With the Essential Income Benefit, beginning at age 45, the contract's lifetime withdrawal percentages will automatically increase each year you keep the contract in deferral, until income payments begin. The base payment percentage is determined by your age at the time you purchase the annuity.

Payout option 1 gives you predictable, dependable income for life. Income option 1 may be a good choice if you want the reassurance of knowing exactly how much income you'll receive, and if you want a guaranteed stream of income that you can't outlive.

Payout option 2 also provides income for life – plus an opportunity for payment increases. Income option 2 offers a smaller payment up front, but it has the potential to increase each year by the interest rate credited to your allocation options in your contract. On every contract anniversary, your annual maximum withdrawal amount (maximum income payment) will be recalculated to reflect the interest rate from selected allocations.

Death benefit

Your beneficiaries can receive the greatest of the full accumulation value, cumulative withdrawal amount, net premium, or the guaranteed minimum value as a lump sum or as annuity income payments over at least five years.

Current MVA reference rate: 5.38 % as of 12/8/2023

Uses the yield of the Bloomberg US Intermediate Corporate Bond Index

Historical MVA reference rates


Ready to take the next step?

Because annuities are complex products, Allianz Essential Income 7 is available exclusively through financial professionals. Ask your financial professional if it may be a good fit as part of your overall portfolio.

Questions to consider

Talk to your financial professional to see if Essential Income 7 is appropriate for you. Here are some questions they can help answer:

  • How are the annuity’s principal and any credited interest protected?
  • How can this product provide income for life and assist with the rising cost of living?
  • What backs up any guarantees available with this product?
  • What else should I consider that might impact my retirement?

Purchasing an annuity within a retirement plan that provides tax deferral under sections of the Internal Revenue Code results in no additional tax benefit. An annuity should be used to fund a qualified plan based upon the annuity’s features other than tax deferral. All annuity features, risks, limitations, and costs should be considered prior to purchasing an annuity within a tax-qualified retirement plan.

Any distributions are subject to ordinary income tax and, if taken prior to age 59½, a 10% federal additional tax.

Guarantees are backed by the financial strength and claims-paying ability of Allianz Life Insurance Company of North America.

This content does not apply in the state of New York.

Standard & Poor’s 500® index (S&P 500®) is comprised of 500 stocks representing major U.S. industrial sectors.

S&P® is a registered trademark of Standard & Poor’s Financial Services LLC (“S&P”). This trademark has been licensed for use by S&P Dow Jones Indices LLC and its affiliates. S&P® and S&P 500® are trademarks of S&P. These trademarks have been sublicensed for certain purposes by Allianz Life Insurance Company of North America (“Allianz”). The S&P 500 is a product of S&P Dow Jones Indices LLC and/or its affiliates and has been licensed for use by Allianz. Allianz products are not sponsored, endorsed, sold, or promoted by S&P Dow Jones Indices LLC, Dow Jones, S&P, or their respective affiliates and neither S&P Dow Jones Indices LLC, Dow Jones, S&P, or their respective affiliates make any representation regarding the advisability of investing in such product.

The Bloomberg US Dynamic Balance Index II is comprised of the Bloomberg US Aggregate RBI Series 1 Index, the S&P 500® Index, and cash, and shifts weighting daily between them based on realized market volatility. The Bloomberg US Aggregate RBI Series 1 Index is comprised of a portfolio of derivative instruments plus cash that are designed to track the Bloomberg US Aggregate Bond Index. The Bloomberg US Aggregate Bond Index is comprised of Bloomberg US investment-grade, fixed-rate bond market securities, including government agency, corporate, and mortgage-backed securities.

The Bloomberg US Dynamic Balance Index II (a "Bloomberg Index") is the property of Bloomberg Index Services Limited and is derived and calculated based on the S&P 500 Index under license from S&P Opco, LLC (a subsidiary of S&P Dow Jones Indices LLC) ("S&P Dow Jones Indices"). S&P® is a registered trademark of Standard & Poor's Financial Services LLC and Dow Jones® is a registered trademark of Dow Jones Trademark Holdings LLC. S&P 500® is a registered trademark of Standard & Poor's Financial Services LLC and has been licensed for use to Bloomberg Index Services Limited. Neither S&P Dow Jones Indices, its affiliates nor their third party licensors sponsor or promote the Index and no such party shall have any liable in connection with the Bloomberg Index.

• Not FDIC insured • May lose value • No bank or credit union guarantee • Not a deposit • Not insured by any federal government agency or NCUA/NCUSIF

Products are issued by Allianz Life Insurance Company of North America, PO Box 59060, Minneapolis, MN 55459-0060. (C61892-02-MVA)

In the state of New York, only Allianz Life Insurance Company of New York is authorized to offer annuities and life insurance.

Product and feature availability may vary by state and broker/dealer.