Allianz Life Insurance Company Of North America Allianz .


Allianz Life Insurance Company of North AmericaAllianzMasterDexPlus AnnuitySMSet your goals. Then set outto achieve them.CB51233-2-TXPage 1 of 16

Allianz MasterDex PlusSM Annuity from Allianz Life Insurance Company of North AmericaA fixed index annuity from Allianz can bea valuable asset.A prudent plan shouldn’t rely solely on future Social Security to pay for an individual’sretirement years. One way to accumulate additional assets for retirement income isan annuity.The money in an annuity has the potential to create an additional source of retirementincome that can supplement Social Security. Assets placed in an annuity can evenprovide a variety of income streams. This is one reason many individuals use annuitiesto help them achieve their long-term financial goals, including retirement income.Here’s how a deferred annuity works.Annuities offer important benefits.A deferred annuity is a contract between a contractowner and a life insurance company. As contractowner, you pay premium to the insurance company.In exchange for your premium, the insurance companypromises to make regular income payments to you overa period of time, beginning at some point in the future.This is called annuitization. You may also receive thebenefits listed in the next section.Potential interest during the annuity’s accumulationphase: During this initial phase, an annuity may be anappropriate vehicle to help you accumulate money foryour retirement.You should not buy an annuity for short-term purposes.You generally have to keep your premium in a deferredannuity such as the Allianz MasterDex Plus Annuity fora specified period of time before you begin receivingincome payments to avoid the assessment ofpenalties, such as surrender charges.Income for life and other options during theretirement income phase: When you are ready to starttaking income, the annuity offers you a range of payoutoptions. Some options may offer a single payment.Others may include income payments scheduled overa specific period of time, including your entire lifetime.Page 2 of 16Guarantees for your contract values: If you surrenderyour contract, you are guaranteed to receive at least aminimum value.

Allianz MasterDex PlusSM Annuity from Allianz Life Insurance Company of North AmericaDiscover theMasterDexPlus Annuityfrom Allianz.Tax deferral that can help your money grow: Themoney in your annuity can grow tax-deferred. Thismeans you don’t have to pay taxes until you begin towithdraw money from the annuity. The power of taxdeferral, compounded over the life of your annuity’saccumulation phase, may have a positive impact onthe value your annuity generates for your retirement.Any distribution may be subject to ordinary incometaxes and, if taken prior to age 59½, to a 10% federaltax penalty.Fixed index annuities are different.Death benefit protection for your beneficiaries:As we noted earlier, annuities are insuranceproducts. So it’s only natural that they can giveyou reassurance, knowing your beneficiariesare protected if you pass away before you startreceiving income through annuitization.Many fixed index annuities also permit contractowners to allocate premium to a traditional fixedinterest option, where interest is credited at a fixedrate of interest not based on any external index.A fixed index annuity has the potential to earninterest based on changes in an external index. Thisis different from traditional annuities, which creditinterest calculated at a fixed rate set in the contract.The selected index varies from day to day and is notpredictable. When you buy a fixed index annuity youown an insurance contract – you are not buying sharesof any index fund, any stock, or bond investments.Please note that Allianz Life Insurance Company of North America (Allianz), its affiliated companies, and their representatives andemployees do not give legal or tax advice. You are encouraged to consult your tax advisor or attorney.Page 3 of 161

Allianz MasterDex PlusSM Annuity from Allianz Life Insurance Company of North AmericaAnnuities are designed to helpprovide income in retirement.2Page 4 of 16

Allianz MasterDex PlusSM Annuity from Allianz Life Insurance Company of North AmericaDiscover the Allianz MasterDex Plus Annuity.Allianz MasterDex Plus is a flexible premium deferred fixed index annuity. It can offer you guaranteeswhile it helps you reach your financial goals. With Allianz MasterDex Plus: Each year, you may receive indexed interest based on changes in a market index, subject to a cap or spread. Any indexed interest is locked in once a year, and can never be lost due to market index declines. After seven years you can take your annuity’s full accumulation value.ProtectionAccumulationFlexibilityAllianz MasterDex Plus protects yourprincipal from index declines.Your principal is never subject to marketindex risk. A downturn in the marketindex(es) cannot reduce your contractvalues. We guarantee it.Allianz MasterDex Plus lets you benefitwhen the market index is heading up.When the market is headed up, the valueof your Allianz MasterDex Plus can alsoincrease. Your indexed interest rate issubject, however, to a cap or spread.If you need cash, Allianz MasterDex Plusgives you access.After the contract anniversary followingyour most recent premium payment,you may annually withdraw up to 10%of your total premiums paid – without asurrender charge.Allianz MasterDex Plus locks in anyinterest automatically.Once any indexed interest is credited toyour annuity’s values, it can never be lostdue to market index changes.Allianz MasterDex Plus offersyou choices.The Allianz MasterDex Plus gives youseveral choices for calculating thepotential indexed interest for yourcontract: monthly sum, monthly average,or annual point-to-point.After seven years it’s your choice: stay,or take the money.After your seventh contract year, you canleave your money in the annuity so itcontinues to benefit from potential indexedinterest and tax deferral. You also havethe option to take your annuity’s full value(minus any outstanding loans).During the first seven contract years, we will apply a surrender charge if you partially or fully surrender your contract. The same wouldapply if you begin receiving annuitization payments prior to the sixth contract year (or for fewer than 10 years). These charges may resultin a loss of indexed interest and fixed interest, and a partial loss of principal (your premium). Any amounts you receive from your contractmay be subject to ordinary income taxes and, if taken prior to age 59½, to a 10% federal tax penalty.Guarantees are backed by the financial strength and claims-paying ability of Allianz Life Insurance Company of North America.3Page 5 of 16

Allianz MasterDex PlusSM Annuity from Allianz Life Insurance Company of North AmericaEnjoy opportunity – and protection.The indexDOES NOTHAVE TOMAKE UPPREVIOUSLOSSESfor the accumulationvalue to earnadditional interest.The following chart is intended to show you howMasterDex Plus can provide opportunity when theindex is up, and protection when the index is down.The red line shows the actual performance of theS&P 500 index (not including any fees or dividends)from December 31, 2000 to December 31, 2010, whilethe dark blue line shows the accumulation value ofa hypothetical MasterDex Plus Annuity, had it beenavailable during that time period, and had it beenissued on January 1, 2001. The minimum accumulationvalue for the annuity (light blue line) is based on amarket index scenario in which the indexed interestrate is zero in all contract years.As you can see from the chart, MasterDex Plus hasan annual reset feature – which means that the indexdoes not have to make up previous losses for theaccumulation value to earn additional interest. Eachcontract year, the index’s ending value becomes nextyear’s starting value. Keep in mind that while you havethe opportunity for increases to your accumulationvalue when the index is up, you may not always receivean increase due to the crediting method calculation.The contract values shown below are based on thefollowing assumptions: 100,000 single premium,annual point-to-point crediting, a hypothetical annualcap of 3.00%, and 100% allocated to the S&P 500index. The cap is declared annually and is guaranteedto never be less than 1.00%. Values shown assume nowithdrawals, loans, or distributions, and do not reflectthe seven-year decreasing surrender charges. 140,000MasterDex Plus Annuity hypothetical accumulation valueMasterDex Plus Annuity guaranteed accumulation valueS&P 500 120,000 100,000 80,000 60,000 40,0002001200220032004200520062007200820092010Keep in mind that this represents past hypothetical results only and will vary depending on several factors. This maynot be used to predict or project future results. Actual results will vary by crediting method and index allocationchosen, caps, and spreads, as well as market conditions. No single crediting method or index allocation consistentlydelivers the most interest under all market conditions.4Page 6 of 16

Allianz MasterDex PlusSM Annuity from Allianz Life Insurance Company of North AmericaAllianz MasterDex Plus tracks marketindex changes, then puts it all together.Here’s how.With Allianz MasterDex Plus, your potential interest is based on the fluctuationsof several of America’s most recognized market indexes.Allianz MasterDex Plus Annuity basicsIndexed interest crediting optionsAllianz MasterDex Plus is a fixed index annuity thatoffers a choice of indexed interest options. Indexedinterest is based on changes in these indexes: S&P 500 Nasdaq-100 FTSE 100 A blended index that credits interest based onthe performance of the Dow Jones IndustrialAverage (35%), Barclays Capital U.S. AggregateBond Index (35%), FTSE 100 Index (20%), andRussell 2000 Index (10%).Potential indexed interest is calculated based on yourchoice of the four indexes mentioned previously andthree crediting method(s): Monthly average crediting Annual point-to-point crediting Monthly sum creditingYou can add money at any time during the first threecontract years. Additional premium payments madeduring a contract year are credited to your contract’sinterim interest allocation and earn fixed interest untilthe following contract anniversary. At that time yourpremium will be reallocated, based on your currentpremium allocations.Monthly average crediting: There is no cap on theamount of indexed interest growth possible withthis crediting method. However, there is an annualspread, which is a deduction determined by thecompany that will reduce the percentage of annualinterest you receive.We begin by capturing the current value of the marketindex on the last business day before your contract isissued, as well as on the last business day before eachcontract “monthiversary.” So if your contract is datedthe seventh of the month, your monthiversary will bethe seventh day of every succeeding month throughoutthe life of the contract.Although external indexes may affect your contract values, the contract does not directly participate in any stockor investments. You are not buying bonds, shares of stock, or shares of an index fund. It is not possible to directlybuy shares of an index. The market index value does not include the dividends paid on the stocks underlying themarket index or interest paid on bonds underlying a bond index. These stock dividends and bond interest are alsonot reflected in the interest credited to your contract.5Page 7 of 16

Allianz MasterDex PlusSM Annuity from Allianz Life Insurance Company of North AmericaExperience thecombinationof variety andflexibility.Indexed interest crediting options(continued)At the end of each contract year, we add up theindividual monthly index values and determine anaverage by dividing the total by 12. We then subtractthe starting index value from the average to determinethe amount of positive or negative change in theindex. This amount is divided by the starting valueto determine the percentage of annual change.To calculate your indexed interest rate for the year,we deduct the annual spread from the percentageof annual change.We then credit the indexed interest rate to yourcontract’s accumulation value. If the result is negative,the indexed interest rate for that year will be zero. Wecan raise or lower the spread annually, but it will neverbe greater than 12%.Annual point-to-point crediting: For this creditingmethod, we capture the value of the market index onthe last business day before your contract is issued, aswell as on the last business day before each contractanniversary. The change from that year’s starting indexvalue can be positive or negative. Any positive changeis divided by that contract year’s starting index value toget the percentage of annual change. If the change inthe market index is negative, the indexed interest ratefor that year will be zero.Next, we apply your contract’s annual cap, or maximum.This may limit the amount of indexed interest youreceive. In any contract year, the index’s percentage ofannual change may exceed the contract’s stated annualcap. In that case, the capped return is the indexedinterest rate. We can raise or lower the cap annuallybut it will never be less than 1.00%.6Page 8 of 16

Allianz MasterDex PlusSM Annuity from Allianz Life Insurance Company of North AmericaMonthly sum crediting: For this crediting method, wecapture the current value of the market index on thelast business day before your contract is issued,as well as on the last business day before eachcontract monthiversary.Monthly changes are calculated by taking the changefrom the previous month’s index value to the currentmonth’s index value and then dividing by the previousmonth’s index value.You can changeALLOCATIONSEACHYEAR.Next, we apply your contract’s monthly cap, ormaximum. This may limit the amount of indexedinterest you receive. In any given contract month, apositive monthly change may exceed your annuity’sstated monthly cap. In that case, the capped monthlychanges will be used in the indexed interest calculation.We can raise or lower the monthly cap annually but itwill never be less than 0.50%.Although there is a monthly cap on positive monthlychanges, there is no established limit on negativemonthly changes. Because of this, a decrease in onemonth could negate several monthly increases. As aresult, even if the market index experienced an overallgain for the year, your contract’s indexed interest ratemay be lower (or zero) if the market index experienceddeclines from one monthiversary to the next.At the end of each contract year, the 12 individualcapped monthly changes are added together tocalculate your indexed interest rate for that year. If theresult is positive, we will credit indexed interest to youraccumulation value at this rate. If this sum is negative,the indexed interest rate for that year will be zero.Choose from a variety of allocationoptions for flexibility.When you purchase your Allianz MasterDex Plus, youcan base your annuity’s potential indexed intereston one or more available index/crediting options.Ask your financial professional for current allocationoption availability.You can allocate premium in increments of 1%or more. Now THAT’S flexibility!Change your mind? No problem!Shortly after your contract anniversary each year,we’ll notify you that you can change your allocations.Changes to your allocations must be submitted inwriting. If we receive your changes within 21 days afteryour contract anniversary, they will be effective duringthat contract year. Allocation changes received morethan 21 days after your contract anniversary won’t takeeffect until your next contract anniversary.On every contract anniversary, any additionalpremium submitted during the previous contractyear will be transferred from the interim interestallocation and allocated based upon your mostcurrent allocation choices.There are no up front sales charges.100% of your premium is credited to youraccumulation value on the day it is received. However,surrender charges apply during the first sevencontract years. Surrender charges may result in theloss of all or part of any indexed interest or fixedinterest you have earned, and a partial loss of principal.7Page 9 of 16

Allianz MasterDex PlusSM Annuity from Allianz Life Insurance Company of North AmericaChoose from a variety of options toreceive steady, predictable income.Several annuity payment options areavailable to you.If you keep your contract in deferral for at least fiveyears, you can choose to receive annuity payments,based on your accumulation value in any of thefollowing ways: Interest only – You have the option to receiveinterest-only annuity payments for five years.Interest will be paid as earned based on the amountof your accumulation value. After five years ofinterest-only payments, you can take your fullaccumulation value as a lump-sum payment, orchoose another payout option. Installments for a guaranteed period – You canchoose to receive annuity payments in equalinstallments for a period from 10 to 30 years. Installments for life – You have the option to receiveannuity payments in equal installments for the restof your life. Payments end upon your death. Installments for life with a guaranteed period – Youcan choose to receive annuity payments in equalinstallments for the rest of your life. Upon your death,annuity payments will be paid to your beneficiary forthe balance of the guaranteed period, the same wayas you previously selected. Installments for a selected amount – You mayreceive annuity payments in equal installments ofan amount that you choose, as long as the paymentslast for at least 10 years. Payments continue until youraccumulation value is gone. Joint and survivor – You can have equal installmentspaid until your death, then continue to be paid to yoursurvivor. In this case, you can select 100%, ² ³, or ½of your payment amount to be paid to your survivoruntil his/her death.8Page 10 of 16The payout rate used to determine the annuity incomestream depends on the age of your contract, the ageof the annuitant, and the payout option selected. Theinterest rate in payout is guaranteed to be at least 1%.Our Flexible Annuity Option Rider lets youreceive annuity payments sooner.The Flexible Annuity Option Rider allows you as theowner to receive annuity payments based on youraccumulation value sooner. You may exercise thisoption anytime after the first contract year but beforethe sixth contract year by electing to receive annuitypayments over a period of 10 to 30 years. Dependingon your age, you may be able to receive this value overfewer than 10 years. There is no additional charge forthis rider.Access your money sooner to help payfor nursing home care.If you, as the contract owner, should enter a nursinghome, long term care facility, or hospital for at least 30days out of a 35-consecutive-day period after the firstcontract year, you may take an accelerated distributionof your contract’s accumulation value as annuitypayments over a period as short as five years.

Allianz MasterDex PlusSM Annuity from Allianz Life Insurance Company of North AmericaAllianz MasterDex Plus offersyou a death benefit.The Allianz MasterDex Plus Annuity provides a deathbenefit payable to your named beneficiary. Regardlessof whether your beneficiary(ies) select to receive thedeath benefit as a lump-sum payment, or as annuityincome payments, they will receive the greater ofthe contract’s accumulation value or guaranteedminimum value (or annuity payments based on thatvalue). This applies only to contracts that have not yetbeen annuitized. The death benefit, paid to a properlydesignated beneficiary (other than the estate), will passwithout the costs and delays of probate.A death benefitcan help yourbeneficiarywithout probate.9Page 11 of 16

Allianz MasterDex PlusSM Annuity from Allianz Life Insurance Company of North AmericaAllianz MasterDex Plus gives you

With Allianz MasterDex Plus, your potential interest is based on the fluctuations of several of America’s most recognized market indexes. Allianz MasterDex Plus Annuity basics Allianz MasterDex Plus is a fixed index annuity that offers a choice of indexed interest options. Indexed interest is based on changes in these indexes: S&P 500