North American Charter Plus Fixed Indexed Annuity

This annuity is a flexible premium fixed indexed annuity with a 14-year surrender charge period. It provides premium protection from market downturns while allowing interest to be credited based in part on the performance of selected external indices. Unlike direct market investments, your accumulation value will not decrease due to negative index performance. Interest credited is locked in at the end of each crediting term through a reset feature, creating a new protected base for future growth. For individuals comparing conservative accumulation options such as MYGA annuity strategies for affluent individuals, Charter Plus 14 introduces the added dimension of indexed growth potential layered on top of principal protection.

One of the defining features of the Charter Plus 14 is its immediate premium bonus structure. Depending on premium size, the base premium bonus can reach up to 13% on premiums received during the first three contract years. In addition, a limited-time premium bonus increase special may apply, further enhancing the immediate value. For clients who want even more upfront leverage, the optional Enhanced Bonus Rider (EBR) adds an additional 12% premium bonus on eligible premiums during the first three contract years, subject to a rider charge of 0.95% of the accumulation value annually during the surrender charge period. While bonus annuities may feature adjusted caps or participation rates compared to non-bonus products, the structure can provide a powerful head start for long-term retirement accumulation when properly aligned with your objectives.

Interest crediting flexibility is central to the design of Charter Plus 14. You may allocate premiums between a fixed account and multiple index account options. Crediting methods include Monthly Point-to-Point with a cap rate, Annual Point-to-Point with either cap or participation rate structures, and Two-Year Point-to-Point strategies. Enhanced participation strategies are also available for those willing to accept a strategy charge in exchange for higher upside participation. Available indices include well-known benchmarks and volatility-controlled strategies from financial institutions such as S&P, Fidelity, Morgan Stanley, Goldman Sachs, and Barclays. This variety allows diversification within the annuity itself, offering multiple ways to pursue growth while maintaining protection from negative index performance.

North American Charter Plus 14: Key Product Features at a Glance

For investors who value structured risk management, the volatility control indices aim to stabilize performance by targeting defined volatility levels. These indices adjust allocations among asset classes to help manage swings in market conditions. While index performance does not guarantee future results and does not include dividends, the structure allows participation in positive movements without direct exposure to equity market losses. Clients who are also evaluating retirement accounts such as those discussed in Is Empower Retirement a Good Company? may find that adding a fixed indexed annuity can provide complementary stability alongside traditional market-based holdings.

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Understanding the Premium Bonus Structure

The premium bonus is one of the most compelling features of the Charter Plus 14 and the element most responsible for its positioning as a long-duration accumulation vehicle. When you fund the contract — whether at issue or during the first three contract years with additional premiums — North American immediately credits a bonus directly to your accumulation value. For premiums below $75,000, the base bonus is 9%. For premiums of $75,000 or more, the base bonus rises to 13%. This means a $100,000 premium deposit immediately creates $113,000 of accumulation value on which all future index-linked interest is calculated and compounded. For clients evaluating how this compares to other bonus structures in the market, our bonus annuity comparison provides a side-by-side framework.

The Enhanced Bonus Rider adds another 12% bonus on top of the base bonus for clients who elect it at issue. A $100,000 premium on a high-band contract with the EBR would create an accumulation value of $125,000 at contract issue — before a single day of index crediting. That head start compounds throughout the 14-year term, and the mathematical compounding effect of beginning from a substantially higher starting base is the core economic argument for the Charter Plus 14’s long-surrender-period design. The EBR carries a 0.95% annual rider charge during the surrender period — an important cost to factor into the net benefit comparison. The rider charge is treated as a penalty-free withdrawal, so it does not reduce the 10% annual free withdrawal allowance. Crucially, the EBR cannot be terminated once elected, which means the decision to add it at purchase is permanent for the life of the contract.

Understanding the bonus recapture provision is equally important. If you take withdrawals in excess of the penalty-free amount during the 14-year surrender period, premium bonus recapture applies — the carrier recovers a portion of the bonus credited to your account. The recapture percentage declines each year, reaching zero at the end of the surrender period. This is the mechanism by which a 14-year commitment is structurally required to fully capture the bonus benefit: clients who exit early lose a portion of what made the product compelling. That is why working with an independent annuity broker who can honestly evaluate whether the Charter Plus 14’s 14-year horizon aligns with your actual retirement timeline is the most important pre-purchase step. Our resource on bonus annuity pros and cons covers the full tradeoff analysis in detail.

Index Crediting Strategies and Volatility-Controlled Options

The Charter Plus 14 offers one of the more sophisticated index menus available in the FIA market, with crediting methods ranging from straightforward annual point-to-point strategies to two-year strategies and enhanced participation designs that carry a strategy charge in exchange for higher upside potential. This range allows clients to construct an allocation inside the annuity that reflects their own view on how best to capture market-linked growth over the contract term — concentrated in one index or diversified across several, simpler cap structures or more complex participation designs.

The Annual Point-to-Point strategies are the most commonly used starting point. These measure index performance from one contract anniversary to the next, and credit interest based on the gain measured during that period — subject to a cap (maximum credit) or a participation rate (percentage of the gain credited). When the index gains less than the cap, you receive the full gain. When the index gains more, your credit is limited to the cap. A participation rate structure credits a defined percentage of whatever the index earned, which in strong bull-market years can substantially exceed what a capped strategy on the same index would have credited. Our guide on index annuity crediting methods explains how cap and participation rate strategies behave differently across market environments, which is essential context for allocation decisions within the Charter Plus 14.

The Two-Year Point-to-Point strategy measures index performance over a two-year crediting term rather than annually. This longer measurement window can smooth out the effect of short-term market volatility — years where the index is flat or down in year one but recovers in year two may still produce a positive credit at the end of the two-year term that an annual strategy would have missed in year one. The tradeoff is that two-year strategies may also produce a zero credit in situations where an annual strategy would have captured a positive gain in one of the two years but ended the two-year term below where it started.

The Enhanced Participation strategies provide access to higher participation rates on select indices in exchange for a strategy charge that is deducted from the accumulation value allocated to that strategy at the end of each crediting term — or at the time of an excess withdrawal. This charge is applied regardless of whether interest was credited, which means in flat or negative index years the enhanced strategy produces a net reduction in accumulation value allocated to it. The accumulation value true-up feature at the end of the 14-year surrender period provides a structural backstop: if total strategy charges have exceeded total interest credited across the full term, a one-time offset benefit may apply, provided no excess withdrawals were taken. This protection makes the enhanced strategies more predictable for clients who commit to the full term.

The volatility-controlled indices available through S&P, Fidelity, Morgan Stanley, Goldman Sachs, and Barclays represent a growing category in the FIA market designed to address a specific challenge: standard equity indices can experience sharp volatility spikes that result in zero credits for an entire annual or two-year crediting term even when the long-run trend is positive. Volatility-controlled indices target a defined volatility level by algorithmically adjusting the allocation between equity and fixed income components — reducing equity exposure when volatility rises and increasing it when conditions are calmer. The result is a smoother return profile with potentially lower peak credits but more consistent non-zero annual credits across different market environments. These indices do not include dividend returns from the underlying securities, and their historic performance is not a guarantee of future results.

Liquidity, the Free Withdrawal Provision, and the Nursing Home Waiver

Liquidity provisions are structured to balance long-term accumulation with reasonable access. Beginning after the first contract anniversary, you may withdraw up to 10% of the accumulation value annually without surrender charges, market value adjustments, or premium bonus recapture. Required Minimum Distributions based solely on this contract may also qualify for penalty-free treatment under current company practice. This 10% annual free withdrawal provision — available from year two forward — provides a meaningful liquidity cushion for clients who anticipate needing supplemental income during the 14-year accumulation period without triggering the full surrender charge structure. For a deeper understanding of how this provision works in practice, our resource on annuity free withdrawal rules covers the mechanics and what clients should confirm before establishing systematic withdrawals from any FIA.

Withdrawals in excess of the penalty-free amount during the surrender charge period may trigger surrender charges beginning at 12%, a market value adjustment, and premium bonus recapture. The market value adjustment is calibrated to movements in an external MVA index since contract issue — if rates have risen since purchase, the MVA may reduce the net surrender value beyond the surrender charge; if rates have fallen, the MVA may increase it. In California, the MVA is limited to the surrender charge or 0.50% of the accumulation value, providing a contractual cap on the downside. As with all annuities, withdrawals may be subject to ordinary income tax and potential IRS penalties if taken prior to age 59½.

The nursing home confinement waiver adds a meaningful safety valve for clients who experience a serious health event during the 14-year surrender period. After the first contract anniversary, if the annuitant becomes confined to a qualified nursing care facility for the required period under the rider terms, up to 100% of the accumulation value may be available each year while confinement continues — without the standard surrender charge and bonus recapture that would otherwise apply to amounts above the 10% free withdrawal. This provision does not replace a dedicated long-term care insurance strategy for clients with significant care cost exposure, but it provides a contractual access mechanism that significantly reduces the financial consequence of a worst-case health scenario during the accumulation period. Availability is subject to rider terms and state-specific restrictions.

About North American Company for Life and Health Insurance

North American Company for Life and Health Insurance is one of the most highly rated annuity carriers operating in the U.S. market. The company holds an A+ (Superior) rating from AM Best — the second highest of 15 possible categories, affirmed in August 2024 — alongside an A+ (Strong) rating from S&P Global Ratings (affirmed May 2025) and an A+ (Stable) rating from Fitch Ratings (affirmed June 2025). Triple A+ ratings across all three major rating agencies is an exceptionally strong financial strength profile that places North American in the top tier of annuity carriers by every relevant measure. With over $25 billion in assets and 135+ years of continuous operation dating to 1886, the carrier brings institutional depth and longevity to the guarantees backing the Charter Plus 14. North American is a member of Sammons Financial Group, one of the largest privately held financial services companies in the country — a structure that insulates management decisions from the short-term pressure of public market shareholders.

For an FIA with a 14-year surrender period, carrier financial strength is particularly relevant because the policyholders are relying on the issuer’s claims-paying ability across a longer horizon than most competing FIA products. North American’s A+ ratings provide a high level of confidence in that regard, and they distinguish the Charter Plus 14 from bonus FIA products issued by carriers with lower financial strength ratings where the bonus may be attractive but the issuer strength is a meaningful consideration. For a more complete evaluation of North American as a carrier, our resource on whether North American is a good company covers the carrier evaluation framework in detail.

How Charter Plus 14 Fits Into a Retirement Plan

The Charter Plus 14 is not designed for short-term funds or assets the client may need to access within the next several years. The 14-year surrender period is a genuine long-term commitment, and the product’s most powerful features — the compounding of a bonus-enhanced starting value across 14 years of index-linked growth, the true-up protection for enhanced strategy users, and the full elimination of all surrender costs at year 14 — require the full commitment period to be captured. For clients who genuinely have a 14-year or longer horizon for a defined pool of retirement assets, the Charter Plus 14 can provide an accumulation structure that combines immediate account value enhancement with principal protection and a range of indexed growth pathways that is difficult to replicate with shorter-duration alternatives.

For clients exploring ways to diversify retirement assets beyond traditional brokerage accounts, pensions, or settlement liquidity strategies such as pre-settlement funding companies, Charter Plus 14 can play a strategic accumulation role. It is particularly well-suited as a vehicle for repositioning a portion of retirement savings that the client does not expect to need for the full 14-year term — a 401(k) rollover from a former employer, a portion of an IRA being repositioned from market risk, or an existing fixed annuity approaching surrender that the client wants to transition into a product with higher growth potential and a powerful immediate bonus. In exchange decisions where the new product’s bonus exceeds the surrender cost of the existing product, the Charter Plus 14’s high-band 13% bonus plus optional EBR can make the transition economics highly favorable even when there are existing surrender charges to absorb.

For clients who are also evaluating how guaranteed income options eventually connect to an FIA accumulation strategy, the Charter Plus 14’s income payout options at the annuity’s maturity — including life income, joint and survivor income, and life income with period certain — provide a natural bridge from accumulation to distribution without requiring a product exchange. For clients integrating annuity income with estate planning tools such as How to Get a Will Online or broader trust planning guidance like How to Get a Will and Trust Online, the named beneficiary structure and probate-avoidance benefit of the annuity death provision can simplify the overall estate planning picture. When integrated alongside protection strategies such as Ethos Life Instant Decision Term or specialized coverage solutions like life insurance for pulmonary diseases, annuities can serve as a stable foundation within a broader financial plan.

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Every retirement plan is unique. Some individuals prioritize maximum upfront bonuses, while others focus on long-term participation rates. Some want to diversify among multiple volatility-controlled indices, while others prefer simpler fixed allocations. The Charter Plus 14 was designed to provide flexibility across those preferences while maintaining principal protection from negative index performance. When structured correctly, it can serve as a durable retirement foundation that supports both accumulation and eventual income.