Aviva's Response To The Dateline Investigation. Fixed Equity Indexed Annuity

April 14, 2008

As you may have seen, NBC's Dateline program on Sunday aired a special investigative report on how annuities are marketed and sold by certain insurance agents. Although Aviva USA was not mentioned in the story, this is a subject we take very seriously.

One of Aviva USA's guiding principles is doing things the right way. We constantly strive to provide the best products and service to our customers and are committed to making our customers' best interests the top priority. The Dateline story presents a good opportunity to reinforce our commitment to our customers:

• Aviva USA has taken a leadership role by instituting one of the strongest suitability requirements in the industry. We require completed suitability forms from all our agents, in all states, for all policyholders regardless of age. In many cases, our requirements exceed those required by the state in which the policy is issued.

• Indexed annuities are a valuable and effective financial product for many consumers. Depending upon the consumer's financial situation, indexed annuities can be a perfectly sound, sensible and prudent component of a retirement planning portfolio. Aviva USA expects its agents to carefully consider each client's needs and curcumstances when making a product recommendation.



• Aviva USA's goal is for every customer to be fully informed, comfortable and secure purchasing our products. We implemented measures company-wide to ensure as best as possible that agents who sell our products are doing so ethically and with full disclosure of the product's features and terms.

We have confidence in our products and our agents. Aviva USA has already addressed many of the inappropriate practices shown in the Dateline program, releasing agent bulletins on Ghostwritten Articles (Number 0300), Advertising Guidelines (Number 0722), Use of Professional Designations (Number 0298) and Seminar Selling (Number 0304). These bulletins have also been attached to this announcement.

We will continue to make customer service and customer satisfaction our top priority. You can also be certain we remain committed to maintaining the highest compliance and suitability standards to ensure that our customers can trust that Aviva USA is a company that does business the right way.

If you have any comments or inquires please contact Sales Support at 800-255-2405 ext 330.

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Dateline NBC "Tricks of The Trade" Featured Annuity Agents Should Have Used The NAIC Buyer's Guide.

Prepared by The National Association of Insurance Commissioners

Surrender or Withdrawal Charges

"If you need access to your money, you may be able to take all or part of the value out of your annuity at any time during the accumulation period. If you take out part of the value, you may pay a withdrawal charge. If you take out all of the value and surrender, or terminate, the annuity, you may pay a surrender charge. In either case, the company may figure the charge as a percentage of the value of the contract, of the premiums you've paid or of the amount you're withdrawing. The company may reduce or even eliminate the surrender charge after you've had the contract for a stated number of years. A company may waive the surrender charge when it pays a death benefit.
Some annuities have stated terms. When the term is up, the contract may automatically expire or renew. You've usually given a short period of time, called a window, to decide if you want to renew or surrender the annuity. If you surrender during the window, you won't have to pay surrender charges. If you renew, the surrender or withdrawal charges may start over.
In some annuities, there is no charge if you surrender your contract when the company's current interest rate falls below a certain level. This may be called a bail-out option.
In a multiple-premium annuity, the surrender charge may apply to each premium paid for a certain period of time. This may be called a rolling surrender or withdrawal charge.
Some annuity contracts have a market value adjustment feature. If interest rates are different when you surrender your annuity than when you bought it, a market value adjustment may make the cash surrender value higher or lower. Since you and the insurance company share this risk, an annuity with an MVA feature may credit a higher rate than an annuity without that feature.
Be sure to read the Tax Treatment section and ask your tax advisor for information about possible tax penalties on withdrawals."

Some states now require agents to present The NAIC Buyer's Guide.

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Why Fixed Indexed Annuities Are Different From Variable Annuities.

Your equity-indexed annuity, like other fixed annuities, also promises to pay a minimum interest rate. The rate that will be applied will not be less than this minimum guaranteed rate even if the index-linked interest rate is lower. The value of your annuity also will not drop below a guaranteed minimum. For example, many single premium contracts guarantee the minimum value will never be less than 90 percent of the premium paid, plus at least 3% in annual interest (less any partial withdrawals). The guaranteed value is the minimum amount available during a term of withdrawals, as well as for some annuitizations (see "Annuity Income Payments") and death benefits. The insurance company will adjust the value of the annuity at the end of each term to reflect any index increases.


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